EXHIBIT 10.2
AUTHORIZED DISTRIBUTOR AGREEMENT
BETWEEN AMERITECH
AND
Telecomm Industries, Inc.
TABLE OF CONTENTS
Business Purpose.............................................................1
Recitals.....................................................................1
ARTICLE 1....................................................................1
APPOINTMENT OF DISTRIBUTORSHIP and AD REPRESENTATION......................1
ARTICLE 2....................................................................3
TERRITORY.................................................................3
ARTICLE 3....................................................................4
EXCLUSIVITY...............................................................4
ARTICLE 4....................................................................4
TERM and TERMINATION......................................................4
ARTICLE 5....................................................................6
AUTHORIZEDDISTRIBUTOR DUTIES..............................................6
ARTICLE 6....................................................................8
AMERITECH'S DUTIES........................................................8
ARTICLE 7....................................................................9
SALES AND COMMISSION......................................................9
ARTICLE 8...................................................................11
THE PARTIES'RELATIONSHIP.................................................11
ARTICLE 9...................................................................11
FACILITIES AND MATERIALS.................................................11
ARTICLE 10..................................................................12
TRADEMARKS AND TRADE NAMES...............................................12
ARTICLE 11..................................................................13
OWNERSHIP OF INFORMATION AND CONFIDENTIALITY.............................13
ARTICLE 12..................................................................15
RIGHT TO SET-OFF.........................................................15
ARTICLE 13..................................................................15
RIGHT TO AUDIT AND INSPECT DISTRIBUTOR'S RECORDS.........................15
ARTICLE 14..................................................................15
AGREEMENT NOT TO COMPETE.................................................15
ARTICLE 15..................................................................16
NOTICE...................................................................16
ARTICLE 16..................................................................17
ASSIGNMENT...............................................................17
ARTICLE 17..................................................................17
GENERAL TERMS............................................................17
Exhibit A TERRITORY....................................................19
Exhibit B PRODUCTS.....................................................20
ATTACHMENT 1: VOICE NETWORK PRODUCTS AND SERVICES.......................21
ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES.......................22
ATTACHMENT 3: USAGE PRODUCTS AND SERVICES...............................23
ATTACHMENT 4: OBJECTIVE RETIREMENT PRODUCT LIST (BY PRODUCT FAMILY).....24
ANNEX 1: VOICE NETWORK PRODUCTS AND SERVICES.........................25
ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES.........................26
ANNEX 3: USAGE PRODUCTS AND SERVICES.................................27
Exhibit C COMMISSION...................................................28
1.0 General............................................................28
2.0 Commission Set Off.................................................31
3.0 Upon Termination...................................................31
4.0 Commission Calculation Methodology.................................32
5.0 Sales Outside of Territory and Sales Outside
of "Objective Territory".......................................33
6.0 Partnering.........................................................33
7.0 Centrex Product Family.............................................33
8.0 Ameritech FeatureLink..............................................37
9.0 Other Voice Products...............................................37
10.0 Ameritech SmartFax Connections..................................38
11.0 Ameritech 9-1-1 Locator ID......................................39
12.0 Eligible Standard Data Products.................................39
13.0 ValueLink Products..............................................42
14.0 1-800-CONFERENCE................................................54
15.0 Ameritech Prepaid Products......................................55
Exhibit D CO-OP AND 5-STAR PROGRAM.....................................56
Exhibit E CODE OF BUSINESS CONDUCT........................................57
Exhibit F HOUSE ACCOUNTS..................................................58
AUTHORIZED DISTRIBUTOR AGREEMENT
BETWEEN AMERITECH
AND
Telecomm Industries, Inc.
This Authorized Distributor Agreement ("Agreement") effective January
1, 1999 by and between Ameritech Information Systems, Inc. a Delaware
corporation with offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter
"Ameritech") and Telecomm Industries, Inc., with offices at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter "Authorized Distributor" or "AD").
Business Purpose
Ameritech and AD have entered into this Distribution Agreement for the
purpose of facilitating the marketing and sale of Ameritech retail products, the
servicing of Ameritech retail business customers in the Territory, and to
provide market coverage and market penetration of Ameritech retail products to
retail, business customers in the Territory. The sales made by AD hereunder
shall always be at the prices and rates Ameritech sets as retail prices for its
business customers. It is the intent of the parties hereto that both parties
will benefit from this Agreement and the relationship established herein.
Recitals
WHEREAS, Ameritech is engaged in providing telecommunications products and
services and desires to appoint distributors to market and sell its Products (as
hereafter defined);
WHEREAS, AD represents and warrants that it is qualified to market and sell
Ameritech's Products and has sufficient knowledge of Ameritech's products to do
so;
NOW, THEREFORE, in consideration of the covenants set forth herein, the
parties agree as follows:
ARTICLE 1
APPOINTMENT OF DISTRIBUTORSHIP and AD REPRESENTATION
Section 1.1.......Grant. Subject to the terms and conditions of this
Agreement, AD is hereby appointed as an authorized distributor of Ameritech
Products (as hereinafter defined) in the geographic Territory (as hereinafter
defined). For purposes of this Agreement, the activities of marketing, promoting
and selling Products, and the servicing of customer accounts pursuant to the
terms of this Agreement shall collectively be referred to herein as "Distribute"
or "Distribution". AD's right to Distribute is limited to the Distribution of
Products which are expressly defined as "Products" under Exhibit B, and in the
"Territory" under Exhibit A, both Exhibits hereby incorporated by reference
herein as modified from time-to-time. "Territory " for purposes of this
Agreement means collectively the geographic area, area codes and Ameritech
business units which are specified on Exhibit A.
Section 1.2.......Non-exclusive. Nothing contained herein shall be
construed to prohibit Ameritech from selling or servicing any of Ameritech's
Products or other products and services in the Territory. In addition, Ameritech
reserves the right to appoint others to Distribute its products and services in
the Territory, and to send its own or third party technical or sales personnel
to any place inside or outside the Territory to assist its distributors or
independent sales representatives in contacting customers (potential or
otherwise), servicing accounts, soliciting business, or promoting the sale of
its products and services.
Section 1.3.......Parties' Relationship. The parties' relationship is
set forth under Article 8 of this Agreement. AD shall not use any sales person
to perform on its behalf hereunder unless said sales person has been registered
by Ameritech as qualified to Distribute its Product. Ameritech reserves the
right to set minimum qualification levels for sales personnel at its sole
discretion and Ameritech will notify AD in writing of all such qualifications.
Section 1.4.......No Authority to Bind. AD shall have no authority to
bind Ameritech by contract or otherwise, or make representations as to policies
or procedures of Ameritech other than as specifically and expressly authorized
by this Agreement.
Section 1.5.......Third Parties and Sub-Distributors. The AD hereby
acknowledges and agrees that Ameritech has the sole and exclusive right to
appoint and authorize others to function and represent themselves as Ameritech
Authorized Distributors or Authorized Sales Representatives. The AD shall not
delegate its appointment or in any way authorize anyone to distribute or
represent themselves as an agent of Ameritech or as an Ameritech Authorized
Distributor or as an Ameritech Authorized Sales Representative. In the event AD
utilizes independent sales representatives to perform on AD's behalf hereunder,
such sales representatives must at all times represent themselves as sales
representatives of AD and not as Authorized Distributors of Ameritech. Ameritech
shall not be liable to pay any fees or compensation to any independent sales
representative acting on behalf of AD, or to pay any other party, including, but
not limited to the AD, for sales generated by any unauthorized representative.
In addition, processing orders for unauthorized or unregistered
individuals shall be deemed a material breach of this Agreement, and in such a
case Ameritech may terminate this Agreement immediately for cause, and pursue
all other rights or remedies it may have in law or equity.
Section 1.6.......AD Responsibility. AD shall be held responsible for
the actions or omissions of each sales representative acting on its behalf,
whether the sales representative is an employee, agent or independent sales
representative of AD. The AD shall require that its employees, agents,
contractors and representatives comply with the requirements of this Agreement
to the same extent as the AD has agreed to comply, including without limitation,
the obligations hereunder regarding Ameritech's logo and other marks (See
Article 10), and the ownership and confidentiality of information (See Article
11).
Section 1.7.......House Accounts. Ameritech reserves the right to
identify certain accounts as "House Accounts", and AD is not authorized to, and
shall not Distribute Products to such accounts. A list of House Accounts is set
forth under Exhibit F of this Agreement, incorporated by reference herein, and
Ameritech, at its sole discretion, may modify Exhibit F from time-to-time via
the "▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" web site and bulletin board, and each modification
will be deemed incorporated herein as if originally set forth herein, and the
modification shall be effective on the date the modification is posted on the
web site and bulletin board.
a) In the event Ameritech newly designates an account as a House
Account, AD will have ninety (90) days from the date of such designation to
close all pending sales activity, and AD will be paid commission for sales made
to that account within said ninety (90) day period. To be eligible for this
exception to the House Account rule, AD must notify Ameritech in writing within
three (3) business days of the new designation by Ameritech that AD has pending
2
sales activity on that account. The writing must include the account name,
telephone number, the Product(s) being marketed, and the current stage of the
sale. AD will not be awarded commission under this subsection on any sale made
to a House Account after ninety (90) days from the date the account is so
designated.
Section 1.8.......Retail Business Customers; Retail Business Prices.
The parties hereto acknowledge and agree that this Agreement is for the purpose
of Distribution of Products to Ameritech's retail business customers at prices
and rates Ameritech deems as its retail prices or rate for sales to business
customers. For purposes of this Agreement "retail customer" shall be determined
by Ameritech in its sole discretion. Unless an exception applies, if an account
is "marked' by Ameritech according to its practices and procedures as assigned
to Ameritech's general business services or custom business services divisions,
the account is deemed to be a retail business customer by Ameritech.
Section 1.9.......End User of Product. In no event is AD granted the
right or authority under this Agreement to distribute Products to anyone whom
the AD knows, or should have known, at the time of sale or within two (2) years
thereafter, is: a) not the end user of the Product; b) subscribing to the
Product for the purpose of reselling it to retail customers; or, c) is not
designated by Ameritech GBS as a "retail" customer of Ameritech.
Section 1.10......Reseller of Ameritech Products. AD is prohibited from
acting as a reseller of Ameritech products and services as that term is defined
under applicable law or as it is used in the telecommunications industry, or
acting on behalf of a reseller of Ameritech products and services.
Section 1.11......Sole Agreement. Ameritech utilizes various channels
to Distribute Product to its retail business customers, and Ameritech's strategy
prohibits cross-over appointments between its channels. Therefore, AD is
prohibited from acting as an Ameritech Enhanced Service Provider, an Authorized
Video Sales Representative or to enter into any other Distribution agreement
with Ameritech under which an appointment to market or sell landline Products to
Ameritech's retail customers is granted.
Section 1.12......Accepts Appointment. AD hereby accepts the
appointment granted above and agrees to comply with the terms and conditions of
the appointment as set forth in this Agreement.
ARTICLE 2
TERRITORY
Section 2.1.......Geographic Territory. The AD's non-exclusive
geographic Territory is set forth in Exhibit A, which is incorporated by
reference herein. During the term of this Agreement, Territory may be expanded
or contracted provided the change is in writing and signed and dated by both
parties. In some cases, expansion of Territory will be deemed by Ameritech to
constitute an addition of a Branch Location, and the conditions set forth in
Section 2.3 below will apply.
Section 2.2.......Out-of-Territory Sale. Ameritech and AD may, in
certain cases, agree that AD will have the right to Distribute Product to an
individual customer outside the Territory. Such arrangement must be in writing,
and signed and dated by Ameritech prior to any sale, and the writing must
include, at a minimum, where and to whom the sale will be made, and the
commission payment, if any, which will apply to any sale made pursuant to that
agreement. No commission will be paid without such a writing.
3
Section 2.3.......Branch Locations. At all times during this Agreement,
AD must maintain in the Territory a physical presence and a formal place of
business from which it carries out its Distribution activities. If AD desires to
Distribute Products outside the Territory or if AD desires to add an additional
business location within the Territory, AD must receive prior written approval
from Ameritech, and said location(s) may be considered "Branch Locations" for
purposes of this Agreement.
Ameritech's approval of any Branch Location may be conditioned, at its
sole discretion, on one or more of the following:
(a) AD enters into a separate Distribution Agreement with Ameritech
whereby Ameritech makes a separate grant of appointment in the new Territory;
(b) AD's annual sales objective level under this Agreement is modified
by Ameritech to recognize the opportunities in the new Territory(ies);
(c) AD establishing a physical presence in the new geographic area;
(d) AD submits to Ameritech satisfactory written documentation
regarding the AD's proposed activities and objectives for the marketing and
sales of the Products as a result of the Branch Location. Said documentation
will be deemed satisfactory at Ameritech's sole discretion. This factor is to
ensure that expansion by the AD will not adversely affect the market coverage
Ameritech expects in the Territory then assigned to AD; and,
(e) Ameritech reserves the right to base its approval on other relevant
business factors which are particular to the AD's request for a branch location.
Section 2.4.......Material Breach. Any violation by AD of the
provisions and conditions of this Article 2 will constitute a material breach,
and Ameritech may terminate this Agreement immediately for cause.
ARTICLE 3
EXCLUSIVITY
Ameritech values its customer relationships, and, as provided elsewhere
in this Agreement, intends to share with AD Ameritech Confidential Information
regarding its customers and customer relationships, including, but not limited
to, business and product plans, customer relationship information and other
sensitive customer data. In the event Ameritech knows or has a reasonable belief
that the AD is marketing, selling or in some way promoting the sale and customer
use of intraLATA telecommunications services, or Prepaid Phone Card, or audio
conferencing and bridging services, or any product or service which is
competitive with a Product, and unless such activity is expressly provided for
elsewhere in this Agreement, Ameritech may terminate this Agreement for cause
immediately. Ameritech's right to terminate under this Article is in addition to
any other right or remedy it may have at law or equity.
4
ARTICLE 4
TERM and TERMINATION
Section 4.1.......Term. This agreement commences on January 1, 1999 or
upon full execution by both parties, whichever is later. This Agreement will
expire on January 1, 2002 ("Initial Term") unless terminated earlier pursuant to
terms of this Agreement. This Agreement will automatically renew for a
subsequent one (1) year term ("Renewal Term") unless one of the parties elects
not to renew, and provides written notice to the other party no later than
ninety (90) days prior to the expiration of the Initial Term.
If a party exercises this right not to renew, the Agreement will expire
naturally at the end of the Initial Term, and all rights and obligations of the
parties cease on the expiration date.
Section 4.2.......Termination.
a) This Agreement may be terminated by Ameritech in whole or in part
without cause and for convenience upon thirty (30) days written Notice to the
AD;
b) This Agreement may be terminated by AD for any reason upon thirty
(30) days written Notice to Ameritech;
c) This Agreement may be terminated immediately where expressly
provided for elsewhere in this Agreement. In such cases, Ameritech will notify
the AD in writing, and the termination shall be for cause, and the effective
date of the termination shall be the date of notice;
d) This Agreement may be terminated by Ameritech for cause in the event
of unsatisfactory performance including, but not limited to, unsatisfactory
sales performance or violation of Section 5.4 of this agreement on the part of
the AD. Ameritech will provide written notice to AD of unsatisfactory
performance, and such notice will provide the period of time available to the AD
to cure the unsatisfactory performance. If AD does not cure in the specified
time, the AD will be given written notice of its termination for cause; and,
e) Notwithstanding the foregoing Sections in this Article, it is agreed
that Ameritech may terminate this Agreement immediately without Notice in the
event of:
(i) an assignment by the AD for the benefit of creditors;
(ii) the institution of voluntary or involuntary proceedings
against the Authorized Distributor in bankruptcy, or under any other
insolvency or similar law which is not dismissed within sixty (60)
days;
(iii) the dissolution of the Authorized Distributor;
(iv) an attempted assignment of this Agreement by the
Authorized Distributor without Ameritech's prior written consent as
required under Article 16 of this Agreement;
(v) Ameritech becomes aware of a sale, transfer or
relinquishment of a substantial interest in the ownership of AD, or a
substantial change in management of the AD;
(vi) a Seriously Delinquent status on any AD landline or
PrePaid Product account with Ameritech which is not cured by AD upon
notice of the Seriously Delinquent, and which cannot be cured through
set-off provided for under this Agreement. "Seriously Delinquent" is
determined solely by Ameritech at its discretion but in no event will a
delinquency of less than ninety (90) days be considered a "Seriously
Delinquent";
(vii) submission to Ameritech by the AD, its employee,
representative, agent or contractor of any false or fraudulent reports
or statements including, but not limited to, any false or fraudulent
claims for credits or reimbursements under the "Co-op", "5 Star" or
other similar Ameritech incentive programs; or,
5
(viii) submission by AD, its representative, contractor or
agent of a sales agreement or sales order or any other document which
is subsequently found to contain forged customer signatures or the
customer denies any knowledge of placing an order with AD.
(ix) AD violates in any way the terms or limitations of its
appointments as set forth under Article 1, or violates in any way AD's
obligations and duties under Article 5.
Section 4.3.......Upon Termination.
(a) Upon expiration or termination of this Agreement, AD shall no
longer be an Authorized Distributor of Ameritech's Products and AD must not
represent itself as such to others;
(b) Upon expiration or termination of this Agreement, AD agrees to
provide to Ameritech a detailed report of all work in progress under this
Agreement within three (3) business days from the termination or expiration of
this Agreement, including, without limitation, pending sales and installations;
(c) Upon expiration or termination of this Agreement, AD shall remove
and return to Ameritech any material, including, without limitation, manuals,
catalogues, brochures, advertising copy, and training materials, or destroy such
materials at Ameritech's sole option;
(d) Upon expiration or termination of this Agreement, the AD shall
remove and discontinue the use of any sign or any other designation containing
any of Ameritech's logos, trademarks or trade names, including, without
limitation, the designation of "Ameritech Authorized Distributor" or "Ameritech
Authorized 5-Star Distributor". Should such trademarks or trade names be printed
on any of the AD's business cards, letterhead or other written documents, the
written documents shall promptly be destroyed, and AD must reprint the materials
so as to remove any such trademarks or trade names of Ameritech;
(e) Upon expiration or termination of this Agreement, AD hereby has the
duty to notify all publishers and others who may identify, list or publish AD's
identity or name as a marketer, promoter or supporter of Ameritech Products that
such identification or publication is prohibited as of the date this Agreement
is terminated. For purposes of this Agreement, Publishers means, but is not
limited to, the publisher of telephone directories, yellow pages, association
directories, or membership rolls; and,
(f) Certain Exhibits and Attachments set forth terms which apply upon
termination of this Agreement, and AD and Ameritech hereby acknowledge their
agreement to those terms.
Section 4.4.......Account Transfer. Upon termination of this Agreement,
Ameritech, at its sole discretion, will designate itself or another AD to act as
successor to AD in providing Ameritech Products to customers "in progress" at
the time of termination, and to service those customers who subscribed to
Products through AD when this Agreement was in effect.
Section 4.5.......Commissions Upon Termination. Upon termination of
this Agreement, Exhibit C governs the treatment of commissions, including,
without limitation, residuals which may apply to AD sales made during the term
of this Agreement.
ARTICLE 5
AUTHORIZED DISTRIBUTOR DUTIES
Section 5.1.......Standard of Conduct. The AD agrees to promote,
encourage and increase the sales to, and acceptance by customers of the Products
within the Territory. AD will fulfill this duty in a professional and diligent
manner. AD agrees that Ameritech's business reputation is one of its most
6
valuable assets. In performing its duties under this Agreement, AD shall observe
the highest standard of integrity and fair dealing with members of the public.
AD shall do nothing which would tend to discredit, dishonor, reflect adversely
upon or in any manner injure the reputation of Ameritech.
Section 5.2.......Application. AD must complete and sign an application
form and return it to Ameritech for acceptance. Ameritech hereby acknowledges
that an application may have already been submitted by AD, and the parties agree
that any prior applications are hereby superceded and replaced by the one which
is submitted pursuant to this Section. Ameritech will review and accept the
application according to its standard practice, and Ameritech will not
countersign this Agreement unless and until an application is accepted by
Ameritech.
Section 5.3.......Sales Achievement. The AD shall satisfy minimum
monthly, quarterly and annual sales performance requirements as set forth on the
document titled "AD Annual Objective Sheet and Tier Multiplier" effective
January 1, 1999, which has been signed by each party and which is incorporated
by reference herein and which may be modified or amended during the term of this
Agreement upon thirty (30) days written notice by Ameritech to AD, and each such
modification or amendment shall be deemed to have been included as if originally
set forth under Attachment 1.
Section 5.4.......Compliance. The Distributor shall comply with all
Ameritech policies, procedures and practices. This includes, but is not limited
to: practices and procedures regarding order and subscriber agreement
processing; accuracy of submitted orders and agreements; Product methods and
procedures; advertising placement and quality rules; commission submission,
payment and inquiry guidelines; Ameritech Identity Guidelines; and, Ameritech
Authorized Distributor Policies and Practices. Notwithstanding the foregoing,
AD, its employees, agents and representatives must comply with all rules,
limitations, procedures and policies related to Ameritech's sales incentive
programs such as 5-Star and Co-Op.
Section 5.5.......Code of Business Conduct. AD understands and agrees
that any violation of the Ameritech Code of Business Conduct by AD's employees,
representatives, contractors or agents will be considered by Ameritech a
violation of this duty by the AD.
Section 5.6.......Inquiries, Quotations and Customer Relations. AD
shall promptly transmit any customer inquiries regarding any matter related to
Ameritech or its Products to Ameritech in a manner prescribed by Ameritech.
Section 5.7.......Customer Information. AD agrees to make available to
Ameritech the names and addresses of all purchasers of Ameritech Products
through AD, and AD agrees that such information is Confidential Information of
Ameritech. The use and disclosure of Ameritech Confidential Information is
governed by the restrictions set forth under Article 11 of this Agreement.
Section 5.8.......Financial Statements. AD shall furnish to Ameritech
such financial statements as may be reasonably requested by Ameritech's credit
manager for Ameritech's confidential use in evaluating the AD's ongoing
participation in the AD Program.
Section 5.9.......Indemnity. AD agrees to indemnify and hold Ameritech
harmless from any claims or losses, including attorneys' fees and expenses,
which arise out of any act or omission of the AD, its employees, agents,
representatives, or contractors, in connection with or related to the AD's
7
marketing, promotion, or demonstration of Ameritech's products or services. In
addition, and not in derogation of the foregoing, AD agrees to indemnify and
hold Ameritech harmless from any claim or loss (including attorneys' fees and
expenses) which arise or is in connection with any statements (whether oral or
written) made with respect to the Ameritech's products or services, and from any
claim or loss which arises from or in connection with any representation or
warranty given, or allegedly given, by AD regarding Ameritech's products or
services, or regarding AD's right to market and sell Ameritech's products and
services, whether such representation or warranty is oral or written, express or
implied.
In addition to, and not in derogation of the above, AD agrees to
indemnify, defend and hold Ameritech free and harmless from any loss, damage,
liability, cost or expense, including legal fees and expenses, for which
Ameritech becomes liable by reason of acts or omissions of AD, its employees,
agents, representatives and contractors during the course of their performance
hereunder, except to the extent that such act or omission was the result of
Ameritech's gross negligence.
Section 5.10......C.P.N.I. AD must comply at all times with Ameritech's
policies on the use of information deemed by Ameritech to be Customer
Proprietary Network Information ("CPNI") under the Telecommunications Act of
1996.
Section 5.11......Duty. AD assumes full responsibility and liability
for the acts of its employees, agents, contractors and representatives, and for
their supervision, daily direction and control. AD shall require compliance with
the duties and obligations of this Agreement to the extent those duties or
obligations apply to the acts of the employee, agent, contractor or
representative.
Section 5.12......Insurance. AD will at all time during the term of
this Agreement, at AD's sole expense, maintain insurance which is appropriate in
type and amount for its performance hereunder, including, but not limited to,
automobile insurance and comprehensive liability insurance against claims for
bodily and personal injury, death, property damage and all other harm caused by
or occurring in connection with AD's, its employees', representatives' and
agents' actions, omissions or misrepresentations. Upon request of Ameritech, AD
will furnish proof which is satisfactory to Ameritech that insurance coverage
required under this Agreement is in effect. Ameritech reserves the right to deem
in its sole discretion whether or not the insurance is "appropriate in type and
amount".
ARTICLE 6
AMERITECH'S DUTIES
Section 6.1.......Sales Materials. Ameritech shall from time-to-time
furnish catalogues, brochures, pamphlets, promotional and other materials
pertaining Products to assist AD in promoting and developing the sale and
acceptance of the products and services in the Territory. AD may request
additional sales materials, Ameritech will furnish them, and a charge may
sometimes apply.
Section 6.2.......Duty to Promote. Ameritech agrees to use reasonable
efforts to promote, encourage and increase the marketing efforts of its Products
through advertising and other marketing initiatives.
Section 6.3.......Payment of Commissions. Ameritech shall pay
commissions to AD pursuant to the terms, conditions and schedule set forth under
Exhibit C.
8
Section 6.4.......AD Incentive Programs.
(a) Ameritech will provide Co-Operative advertising funds under its
"Ameritech Authorized Distributor Co-Op Program" ("Co-Op"). The terms,
conditions, limitations and obligations of the parties under the Co-Op program
are set forth in the document titled, "The Co-Op and 5-Star Program" dated
January, 1999 set forth under Exhibit D hereto, which is incorporated by
reference herein. Notice of any modification to the Co-Op program will be made
via the "▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" web site and bulletin board, and each modification
will be deemed incorporated herein under Exhibit D as if originally set forth
therein in its entirety. The modification will be effective the date it is
posted by Ameritech on the web site bulletin board. Modification means any
change to the Co-Op program, up to and including discontinuing all or part of
the program.
(b) Partners in Excellence. Ameritech will make available to AD an
incentive program which will allow the AD, at its election and discretion, to
qualify as an "Ameritech 5-Star Distributor", and become eligible for the
benefits associated with that status. On an annual basis Ameritech will provide
AD with the criteria for the "Partner's in Excellence" program ("PIE"), which is
the criteria which will be used to determine if the AD qualifies as an
"Ameritech 5-Star Authorized Distributor" ("5-Star"). If qualified under PIE, AD
may indicate to others its status as a "5-Star" AD, and will receive benefits
associated with the 5-Star status.
ARTICLE 7
SALES AND COMMISSION
Section 7.1.......Exhibit C - Commissions. Ameritech agrees to pay AD
commission pursuant to Exhibit C hereto, incorporated by reference herein, as
may be amended from time-to-time. Commissions are earned by AD at the time of
payment by Ameritech. Ameritech's commission payment procedures and practices
are governed by Ameritech AD commission practices and procedures which are
established by Ameritech in its sole discretion, and may be modified by
Ameritech at any time for any reason, including, but not limited to, more
efficient handling of payment inquiries and tracking.
Section 7.2.......Sales Within Territory. Ameritech shall pay
commission to AD on sales within the Territory for all Products and will pay
commission for sales out of Territory only if AD has received prior written
consent from Ameritech for such treatment. Sales outside of the Objective
Territory (hereinafter defined) are treated differently from those within the
Objective Territory for purposes of commission, as further described under
Exhibit C.
Section 7.3.......End Users. As provided elsewhere in this Agreement,
AD is prohibited from selling Product to a purchaser the AD knows or should know
is not, or will not be in the future, the end user of the Product, therefore,
Ameritech will not pay commission on such a sale. Nonpayment of commission is in
addition to any right or remedy Ameritech may have available in law or in equity
for violation of this Section.
Section 7.4.......Retail Business Customers. As provided elsewhere in
this Agreement, the purpose of this Agreement is to benefit each party from the
sale of Product to the retail business customers of Ameritech at retail business
prices. Therefore, Ameritech will not pay commission on any product sold to a
9
customer who is not designated as a retail business customer by Ameritech, or
which is sold at a rate or price which is not deemed by Ameritech to be a retail
price. Nonpayment of commission under this subsection is in addition to any
right or remedy Ameritech may have available in law or in equity for a violation
of this Section.
Section 7.5.......Special Arrangements. Ameritech acknowledges that the
dynamics of the telecommunications industry and the retail business customer
market may result in specialized sales. AD may request unique commission
handling for a specialized sale, and Ameritech reserves the right in its sole
discretion to accept or reject the AD's request, to set the commission payment
the AD will receive if the sale is finalized, and establish the payment schedule
which will apply to such a payment. The decision by Ameritech on a specialized
arrangement is final and not appealable. To be eligible for unique commission
handling, Ameritech must consent in writing to the special arrangement prior to
the close of the sale. No exceptions will apply to this condition.
Section 7.6.......Commission Values. Ameritech is solely responsible
for the determination and calculation of the commission to be paid on an
individual sale, and Ameritech's commission award to AD, absent arithmetic
errors, is final and not appealable. Ameritech reserves the right to pay a
commission amount different from that which is set forth under Exhibit C,
provided that modification is reasonable, and Ameritech reserves the right to
establish a payment schedule for such a commission award.
Section 7.7.......Partnering. Ameritech does not discourage its ADs
from working together or with other Ameritech direct sales representatives on a
specific sale if it is in the best interest of Ameritech, provided Ameritech is
notified and approves of such partnering prior to any customer sales proposal.
In the event of such approved partnering arrangements, Ameritech reserves the
right to establish a commission payment value and payment schedule for such a
sale without invalidating any part of this Agreement, and such arrangement shall
not be considered as establishing a precedent. Ameritech in its sole discretion
shall establish the value and commission payment percentages due to each of the
sale partners.
Section 7.8.......No Authority to Bind. AD has no authority to bind
Ameritech, and all orders, subscriber agreements and customer contracts are
subject to acceptance by Ameritech in the manner prescribed by Ameritech.
Therefore, AD shall not be paid commission on any sale or order until the
subscriber agreement or order is accepted by Ameritech under the then-in-effect
acceptance procedures. Ameritech's acceptance will not be unreasonably withheld
or delayed. Ameritech as the Product supplier has the right to refuse any
customer order for any reason Ameritech deems sufficient, and AD shall not be
entitled to any commission on any order so refused.
Section 7.9.......Discrepancy of Commission Due and Audit. In the event
of a discrepancy between the sales reflected on the Ameritech generated AD
commission report and the sales which AD claims were approved and processed by
Ameritech, AD may request an audit of Ameritech's commission records. The AD may
employ such assistance as it deems desirable to conduct the audit, but may not
use the assistance of: (i) a person or an entity that competes or whose employer
competes with Ameritech; (ii) that is the principal outside auditor of a
competitor of Ameritech (unless such auditor is also the AD's principal outside
auditor); or, (iii) is someone to whom Ameritech reasonably objects to
performing any such audit. AD shall cause any person or firm retained for this
purpose to execute a non-disclosure agreement in favor of Ameritech.
10
If the audit reveals that Ameritech made an error in its favor which
totals twenty-five percent (25%) or more of the AD's year to date commissions,
as determined by the most current Ameritech commission report, Ameritech will
bear the expense of the audit, provided that AD submits evidence of actual
expense.
ARTICLE 8
THE PARTIES' RELATIONSHIP
Section 8.1.......Independent Representative. The parties agree that
the relationship arising from this Agreement is that of Product supplier and
independent sales representative, and the relationship arising from this
Agreement does not constitute or create an agency, joint venture, partnership,
an employee relationship or franchise between them. AD has no authority to bind
Ameritech in contract or otherwise, or to make representations as to the
policies or procedures of Ameritech other than as expressly authorized by
Ameritech. AD acknowledges and agrees that it is an independent business with
respect to its performance under this Agreement.
Section 8.2.......Identification. The AD is and must at all times hold
itself out to be an independent business authorized to act as an authorized
distributor with respect to the Products. Unless expressly and specifically
authorized by Ameritech in writing, AD shall not make any promise, warranty or
representation on Ameritech's behalf with respect to the Products, or any other
matter.
Section 8.3.......No Fee. AD acknowledges that it has awarded no fee to
Ameritech in connection with the appointment made by Ameritech under this
Agreement.
Section 8.4.......Employees. AD, its employees, agents, representatives
and contractors are not and will not be, and shall not be deemed to be,
employees or joint employees of Ameritech, its parent or its affiliates, and
shall at no time be eligible for or apply for eligibility for any insurance or
other benefit available to an employee of Ameritech Corporation, its
subsidiaries or affiliates. Ameritech is not and will not be responsible for
worker's compensation, disability benefits, unemployment insurance, withholding
taxes, social security or any other taxes or benefits for AD, its employees,
agents, representatives and contractors. AD is and shall be responsible for all
federal, state, and local taxes applicable to it, and hereby agrees to indemnify
and hold Ameritech harmless from any claim or liability therefrom.
ARTICLE 9
FACILITIES AND MATERIALS
AD hereby represents and warrants that it has adequate facilities,
equipment, means of transportation, sales force, distribution capabilities, and
business office and clerical staff necessary to perform the services and
activities required by this Agreement. Ameritech reserves the right to obtain
access to AD's facilities for the purpose of examining the adequacy of the
facilities and materials. Such access will be granted by AD provided it is
during AD's regular business hours. AD also represents that none of the above
items have been specifically acquired or obtained for the performance of this
Agreement.
11
ARTICLE 10
TRADEMARKS AND TRADE NAMES
Section 10.1......Limited, Non-exclusive License. Ameritech hereby
grants to AD a limited, non-exclusive, non-transferable, non-sublicenseable,
royalty-free right to use the AMERITECH trade names, trademarks, and service
marks, (hereinafter, "the Marks") in the Territory in accordance with AD's
performance hereunder. This license is conditioned on AD's complete compliance
with Ameritech's policies, practices and procedures for use of the Marks, and
Ameritech's Identity Guidelines, both which are provided to AD by Ameritech. In
addition, the AD must comply with all applicable governmental regulations with
respect to the Marks. Ameritech reserves the right to inspect, observe, review
and in any way audit the AD's use of the Marks at any time during the term of
this Agreement, and, if requested by Ameritech, such review or audit shall take
place on AD's premises, and AD grants Ameritech access to conduct such review
during AD's normal business hours.
AD shall not use, and is prohibited from adopting any of the Marks, or
any part of any of the Marks as an Internet domain name, and shall not register,
or seek to register any name or ▇▇▇▇ anywhere in the world which is identical or
confusingly similar to any ▇▇▇▇, or so similar thereto as to constitute a
colorable imitation thereof or to suggest some association, sponsorship, or
endorsement by Ameritech.
Section 10.2......Ameritech's Rights in Marks. AD will not alter,
modify, dilute or misuse the Marks, bring them into disrepute or challenge
Ameritech's rights in them. AD shall cooperate with Ameritech as may be
reasonably necessary for Ameritech to protect, prosecute or defend its rights
with respect to the Marks.
Section 10.3......Layout Limitations. AD's right to use the designation
of "Ameritech Authorized Distributor" or "Ameritech Authorized 5-Star
Distributor" is limited to the layout and design guidelines which are set forth
in Ameritech's Identity Guidelines. Any use of that designation which is not in
complete compliance with the use requirements and guidelines under Exhibit D
will be considered a material breach of this Agreement, and Ameritech may
terminate this Agreement upon Notice if AD does not cure the breach immediately
and to the satisfaction of Ameritech. Such termination is in addition to any
other right or remedy Ameritech may have available to it at law or equity.
Section 10.4......Ameritech Consent Required. AD will not combine the
Marks with any other marks, names, or symbols without Ameritech's prior written
consent. The AD shall refrain from using any name, trademark, trade name, logo,
slogan, label, title or insignia, or one confusingly similar thereto, now or
hereafter owned adopted or used by Ameritech (whether registered or
unregistered) in any manner, or any medium, or for any other reason than that
approved by Ameritech, and shall refrain from any use in any geographic area
outside of the Territory.
Section 10.5......Substantial Value. AD hereby acknowledges the
substantial value of the Marks and the goodwill associated therewith, and
acknowledges that such goodwill is a property right belonging to Ameritech. AD
recognizes that Ameritech is the owner of the Marks, and that nothing contained
in this Agreement is intended as an assignment or grant to the AD of any right,
title, or interest in or to the Marks. AD shall not do anything which is
inconsistent with Ameritech's ownership of the Marks, and all use of the Marks
by AD shall inure to the benefit of and be on behalf of Ameritech. AD hereby
12
acknowledges and agrees that its use of the Marks is limited to purposes which
are necessary for its performance hereunder.
Section 10.6......Reproduction. AD agrees that accurate reproduction of
the Marks is uppermost. Prior to use, AD must provide Ameritech with approval
samples of all advertising, business cards, letterhead and any other materials
which bear Marks. Ameritech will attempt to answer promptly; if Ameritech does
not respond within sixty (60) days of receipt of such materials (except
advertising), they will be deemed not approved. With respect to advertising, if
Ameritech does not respond within thirty (30) days, the advertising will be
considered approved. AD is prohibited from modifying or changing any such
approved material without first obtaining written approval.
Section 10.7......Discontinue Use. Upon expiration or termination of
this Agreement, AD shall immediately discontinue use of any trademark, trade
name, logo, slogan, label, title or insignia now or hereafter owned, adopted or
used by Ameritech (whether registered or unregistered), and destroy all printed
materials (including but not limited to business cards, letterhead, promotional
and advertising materials, store signage, vehicle signage, and customer premises
stickers and signage) bearing any of the Marks.
Section 10.8......Indemnification. Ameritech shall indemnify and hold
AD harmless from any and all damage or expense resulting from valid trademark
infringement claims with respect to any of the Marks used by the AD pursuant to
this Agreement, provided, however, that: (a) Ameritech is given notice within
ten (10) days after the AD received notice of such claim or suit for
infringement, together with full information with respect thereto, and complete
control of the defense and any settlement thereof; and, (b) AD's use of the
▇▇▇▇(s) which gives rise to the claim is a permitted use in accordance with this
Agreement.
Section 10.9......No Other Rights. No other rights are granted to AD to
use any trademarks, trade names, service marks or service names of Ameritech or
its affiliates. Further, no licenses, warranties, or indemnifications, express
or implied, under any patents, copyrights, or any trade secrets are granted to
AD.
Section 10.10.....Survival. This Article 10 and all its Sections shall
survive any termination or expiration of this Agreement.
ARTICLE 11
OWNERSHIP OF INFORMATION AND CONFIDENTIALITY
Section 11.1......Ameritech Confidential Information. Any business and
management information of Ameritech, its parent or its affiliates, including,
but not limited to, reports, product specifications, pricing, product design,
business plans, strategies and practices, marketing or technical information and
data, and information regarding or related to customers, including, without
limitation, customer segmentation strategies and placement, existing customer
account information and history and potential targeted customers, and any
material marked "confidential" or "proprietary" which is furnished or disclosed
by Ameritech or its representative is collectively deemed "Ameritech
Confidential Information". Ameritech Confidential Information of Ameritech is
acknowledged herein by the parties to be a significant asset of Ameritech, and
Ameritech will disclose its Confidential Information for AD to assist AD in its
13
performance hereunder. Any Ameritech Confidential Information which is disclosed
to AD or otherwise learned by AD during the term of this Agreement is deemed the
exclusive property of Ameritech.
In addition, sales information including, but not limited to, the terms
and conditions of standard contracts, sales and operational methods, business
acquisition plans; new personnel acquisition plans; and, other business affairs
of Ameritech and any of its affiliates, are Ameritech "Confidential Information"
and trade secrets.
Section 11.2......Ten Years. During the term of this Agreement and for
a period of ten (10) years thereafter Ameritech Confidential Information shall
not be disclosed by AD to any person except officers and employees of the AD
requiring the information to perform under this Agreement. In no event shall
Ameritech Confidential Information or trade secrets be used for the benefit of
the AD except in connection with performing under this Agreement.
Section 11.3......Bound to the Same Extent as AD. The AD shall require
all officers, employees, agents and representatives to whom that information is
available or disclosed to by AD to agree to protect against disclosure to others
of Ameritech Confidential Information to the same extent as the AD has agreed.
Section 11.4......Liability. The AD shall be liable to Ameritech for
damages caused by any breach of this provision or by any unauthorized disclosure
of that Confidential Information and those materials by its officers, employees,
representatives and agents.
Section 11.5......AD Confidential Information. Ameritech agrees that it
will protect the disclosure of AD Confidential Information to the same extent it
protects its own Confidential Information. In no event is Ameritech authorized
to disclose AD Confidential Information outside of Ameritech without prior
written approval of AD.
Section 11.6......Limitations. The obligations of this Article 11 shall
not apply to Ameritech Confidential Information which is: (i) available to the
public through no breach of this Agreement; (ii) is required by law or
regulation to be disclosed, but only to the extent and for the purposes of such
required disclosure; or, (iii) is disclosed in response to a valid order of a
court or other governmental body of the United States with proper jurisdiction,
but only to the extent of and for the purposes of such order and only if the AD
first notifies Ameritech of the order and permits Ameritech to seek an
appropriate protective order.
Section 11.7......Ownership of Subscriber Information. To the extent
allowed under law, all subscriber and customer information, which includes, but
is not limited to: subscriber and customer lists; customer's use of products and
services; subscriber billing and related information; and, subscriber and
customer satisfaction information, all of which is collectively referred to
herein as "Subscriber Information" is the exclusive property of Ameritech and is
to be used by the AD only for purposes of this Agreement, and promptly returned
to Ameritech upon termination or expiration of this Agreement. Subscriber
Information is always Ameritech Confidential Information.
Section 11.8......Terms of this Agreement. The terms and conditions of
this Agreement are Confidential Information of Ameritech and AD.
14
Section 11.9......Survival. This Article 11 and all its Sections shall
survive the termination or expiration of this Agreement.
ARTICLE 12
RIGHT TO SET-OFF
Ameritech reserves the right to set-off commissions due to AD if any AD
account with Ameritech is deemed by Ameritech to be "Seriously Delinquent"
(defined hereinafter). Ameritech's set-off right is governed by Exhibit C,
Section 2.0. In the event set-off is not adequate for an AD's Seriously
Delinquent accounts, Ameritech's right to terminate is governed by Section 4.2
(c).
ARTICLE 13
RIGHT TO AUDIT AND INSPECT DISTRIBUTOR'S RECORDS
During the term of this Agreement and for one (1) year after
termination or expiration of this Agreement, Ameritech reserves the right to
obtain access to and examine fully the books, records and accounts of all
transactions and activities covered by this Agreement upon reasonable notice to
AD and during AD's regular business hours.
ARTICLE 14
AGREEMENT NOT TO COMPETE
Section 14.1......Protection of Ameritech's Customer Relationship. The
parties agree with the Business Purpose of this Agreement which is stated above,
and agree that the commitments of this Article 14 are necessary to maintain this
mutual benefit. The parties agree that this Article 14 serves to protect
Ameritech's legitimate business interest in protecting Ameritech's customer
relationships and Ameritech's customer/subscriber information which is disclosed
to AD solely for successful performance hereunder.
Section 14.2......Term of Non-Compete. During the term of this
Agreement and for a period of one (1) year thereafter, AD and individuals
associated with AD will be privileged to a significant amount of Ameritech
Confidential Information, therefore, AD and its principal(s) director(s),
officer(s) and shareholder(s) (except those holding stock in the AD corporation
whose stock is publicly traded and which is subject to the reporting
requirements of the Securities Exchange Act of 1934 and then only to the extent
of owning not more than ten percent (10%) of the issued and outstanding shares
of such corporation), collectively and individually are bound by the terms of
this Section.
AD and any individual subject to this Section shall not assist or
facilitate the sale or use by a customer of a product or service which is
"competitive" to the Products. For purposes of this Section, "competitive to"
shall mean that the product or service is of a similar type or serves the same
purpose as the Product(s), or performs the same function as the Products, or
provides the customer the same benefit as the Products covered by this
Agreement. This shall mean that an individual subject to this Section shall not
15
be employed by, serve as an agent for, or act as a representative or contractor
for a company which sells, promotes or distributes the competitive products or
services in the Territory.
Section 14.3......Equitable Relief. The AD, its shareholders and
officers, jointly and severally acknowledge and agree that the remedy at law for
any breach, or threatened breach, of any of the provisions of Article 14 will be
inadequate, and the AD and its shareholders jointly and severally agree that
Ameritech shall be entitled to such equitable relief as may be available from
any court of competent jurisdiction, and this right shall be in addition to any
other rights or remedies it may have for any violation of these provisions.
Section 14.4......Severability. In the event any of the provisions of
this Article 14 is determined by a court of competent jurisdiction to be in
violation of applicable law for any reason whatsoever, then any such provision
or part of a provision shall be deemed to be automatically amended so as to
comply with applicable law, and not deemed void.
Section 14.5......Survival. This Article 14 and all its Sections shall
survive the termination or expiration of this Agreement.
ARTICLE 15
NOTICE
Section 15.1......Notice. Unless Notice via "▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" is
expressly identified as proper communication elsewhere in this Agreement, Notice
or other communication given by one party to the other under this Agreement
shall be deemed sufficient and proper if the Notice is in writing and is
delivered personally, or is sent postage prepaid, first class U.S. Mail, or by
overnight courier, and such Notice shall be deemed received by the other party:
a) three (3) days after the Notice is deposited with the U.S. Postal Service;
or, b) the following business day if sent by overnight courier. Notice will also
be deemed sufficient and proper if sent by facsimile provided the original
notice is sent via postage prepaid, first class U.S. Mail the same day as the
facsimile; if sent by facsimile Notice will be deemed received by the other
party on the date and time shown on the original transmission confirmation sheet
which is electronically generated by the facsimile machine at the time the
transmission is completed. Notice must be directed as set forth below; each
party reserves the right to change the direction of the Notice, and will do so
through proper Notice to the other party.
If to Ameritech If to AD
Ameritech ▇▇▇▇▇ ▇▇▇▇▇▇
225 ▇. ▇▇▇▇▇▇▇▇, Floor Telecomm Industries
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇: Alternate Channels ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile Number: ▇▇▇-▇▇▇-▇▇▇▇ Facsimile Number:_________________
16
ARTICLE 16
ASSIGNMENT
Section 16.1......AD Assignment. This Agreement may not be assigned by
AD without the prior written consent of Ameritech, and such consent will not be
unreasonably denied or withheld. Any attempted assignment in violation of this
Section shall be deemed void. In the event the proposed assignee is an existing
Ameritech AD, Ameritech reserves the right to consent with conditions, including
but not limited to, conditioning consent on acceptance by AD of Territory
modifications or sales objective restructure.
Section 16.2......Complying Assignment. In the event of a complying
assignment, this Agreement shall be binding upon and shall inure to the benefit
of the party's respective assigns and successors.
ARTICLE 17
GENERAL TERMS
Section 17.1......Governing Law. This Agreement shall be governed and
construed by the laws of the State of Illinois, as those laws apply to contracts
which are executed and fully performed within that State.
Section 17.2......Counterparts. This Agreement shall be executed in
counterparts and shall not be binding upon Ameritech until each counterpart is
executed by Ameritech and AD. Each party will retain a document with original
signature, and each fully executed counterpart will be considered an original
Agreement.
Section 17.3......Non-Waiver. All rights, remedies and relief available
to Ameritech shall be exercised at Ameritech's sole option. The failure of
Ameritech to enforce at any time any provision of this Agreement, or to exercise
any option which is provided for herein, or the failure of Ameritech to require
performance by the AD of any provision herein, shall in no way affect the
validity of, or act as a waiver of this Agreement, or any part thereof or any
right of Ameritech thereafter to enforce it.
Section 17.4......Incorporation. All Recitals, Exhibits and Attachments
and Annexes are fully incorporated herein, and each modification or amendment
thereto shall be deemed incorporated as if set forth originally therein.
Ameritech reserves the right to modify, add to and amend this Agreement,
including the Exhibits and Attachments hereto upon thirty (30) days written
notice to AD, and the modification, addition or amendment will be effective on
the thirtieth (30th) calendar day after the date the Notice is received by the
AD without the requirement of acknowledgement or any other act by AD.
Section 17.5......Entire Agreement. This Agreement contains the entire
agreement of the parties related to Ameritech's grant of rights as an Ameritech
Authorized Distributor and AD's acceptance thereof, and cancels all prior
agreements, understandings and representations, whether written or oral, express
or implied, and all such prior agreements are hereby deemed terminated by mutual
consent of the parties and all obligations under any such prior agreement are
agreed by each party to be inoperable and unenforceable.
17
Section 17.6......Section Headings. All article and section headings
and captions used in this Agreement are for convenience or reference only and
are not intended to define or limit the scope of any provisions in this
Agreement.
IN WITNESS WHEREOF, and intending to be legally bound, the undersigned
authorized parties have duly executed this Agreement effective on the date.
Ameritech Information Systems, Inc. Telecomm Industries, Inc.
By:_______________________________ By:______________________________
Signature: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Signature: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name Typed or Printed: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Name Typed or Printed: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director Title: CEO
Date: January 22, 1999 Date: December 30, 1998
[The Balance of this Page Intentionally Left Blank]
18
Exhibit A
Territory
Exhibit A TERRITORY
This is Exhibit A to the Authorized Distributor Agreement Between
Ameritech and Telecomm Industries, Inc. ("AD") dated January 1, 1999.
AD is hereby granted the right to distribute in the Territory specified
under this Exhibit. AD's right under the Agreement and this Exhibit is
conditioned on full execution of the Agreement and the signature of both parties
at the end of each Exhibit.
Ameritech and AD agree that sales outside of the Territory are not
encouraged and AD's authority to market, promote or sell Ameritech products to
customers outside of the Territory requires prior written approval by Ameritech.
STATE:
AREA CODES*:
If a business unit is not specifically listed below, sales by AD to
customers classified by Ameritech as served by that business unit are considered
"out of Territory" sales for purpose of this Agreement.**
*Any area code split will result in automatic inclusion of the new area codes
unless AD is otherwise notified in writing by Ameritech.
**Key - CBS means customers of the Custom Business Services
business unit
GBS means customers of the General
Business Services business unit
[The Balance of this Page Intentionally Left Blank]
19
Exhibit B
Products
Exhibit B PRODUCTS
This is Exhibit B to the Authorized Distributor Agreement between
Ameritech and Telecomm Industries, Inc. ("AD") dated January 1, 1999.
AD is authorized to Distribute the Products specified under the
Attachments only if the following conditions are satisfied: i) the
above-referenced Agreement is fully executed by the parties; and, ii) all three
product family Attachment pages of this Exhibit are fully executed by each
party.
Attachment 4 to this Exhibit specifies which Products retire AD's sales
objective in a Product family. Sales of Products which do not retire the AD's
objective are treated differently for purpose of commission, and such treatment
is specified in Exhibit C.
For convenience purposes only, each product family category is set
forth under its own Attachment to this Exhibit, and each product or service in
that product family category is itemized. AD and Ameritech will appropriately
indicate which Products AD is authorized to Distribute, and will sign and date
each product family Attachment.
The products and services which are identified under the fully executed
Exhibits herein together and collectively constitute the "Product" for purposes
of the above referenced Agreement between Ameritech and AD.
The Attachments are:
Attachment 1 Voice Network Products and Services
Attachment 2 Standard Data Products and Services
Attachment 3 Usage Products and Services
Attachment 4 Objective Retirement Product List (by Product Family)
[The Balance of this Page Intentionally Left Blank]
20
Exhibit B, Attachment 1
Voice Network Products
ATTACHMENT 1: VOICE NETWORK PRODUCTS AND SERVICES
This is incorporated as Attachment 1 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
Ameritech 1-800-CONFERENCE
Ameritech 9-1-1 Locator ID
Ameritech Caller ID
Ameritech Centrex Service (Includes ISDN Centrex)
Ameritech Custom CallingServices
Ameritech Digital Transport Service-Enhanced (ADTS-E)
Ameritech DSO(except Total Access Service)
Ameritech DS1 (except Total Access Service)
Ameritech FeatureLink
Ameritech ISDN Direct Service
Ameritech ISDN Prime Service
Ameritech Linebacker
Ameritech Local Access Lines
Ameritech PBX Trunks
Ameritech Remote Call Forwarding
Ameritech SmartFax Connections
Ameritech VoiceMail
------------------------------ ---------------------------------------
Ameritech Signature AD Signature
------------------------------ ---------------------------------------
Date Date
[The Balance of this Page Intentionally Left Blank]
21
Exhibit B, Attachment 2
Standard Data Products
ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES
This is incorporated as Attachment 2 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
Ameritech Analog Video Service
Ameritech Asynchronous Transfer Mode Service (ATM)
Ameritech Broadcast Video Service
Ameritech Connectionless Broadband Data Service (CBDS)
Ameritech Digital Transport Service - Enhanced (ADTS-E)
Ameritech DSO (except Total Access Service)
Ameritech DS1 (except Total Access Service)
Ameritech DS3 (except Total Access Service)
Ameritech Fiber Distributed Data Interface Service (FDDI)
Ameritech Fractional DS1 (384) (except Total Access Service)
Ameritech Frame Relay Service (FRS)
Ameritech Host Interconnection Service (AHIS)
Ameritech Internet Access (Dedicated Access over Frame Relay or CBDS)
Ameritech ISDN Direct Service
Ameritech ISDN Prime Service
Ameritech LAN Interconnect Service (ALIS)
Ameritech Packet Switched Data Service
Ameritech Reconfiguration Service (ARS)
Ameritech Remote Office Access Manager (ROAM)
Ameritech Synchronized Optical Network Service (SONET)
------------------------------ -----------------------------------
Ameritech Signature AD Signature
------------------------------ -----------------------------------
Date Date
[The Balance of this Page Intentionally Left Blank]
22
Exhibit B, Attachment 3
Usage Products
ATTACHMENT 3: USAGE PRODUCTS AND SERVICES
This is incorporated as Attachment 3 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
Ameritech 1-800-CONFERENCE
Ameritech 9-1-1 Locator ID
Ameritech Caller ID
Ameritech Custom Calling Services
Ameritech Digital Transport Service - Enhanced (ADTS-E)
Ameritech Linebacker
Ameritech Local Access Lines
Ameritech PrePaid Products
Ameritech PBX Trunks
Ameritech Remote Call Forwarding
Ameritech SmartFax Connections
Ameritech ValueLink Product Family
Ameritech Voice Mail
------------------------------ -----------------------------------
Ameritech Signature AD Signature
------------------------------ -----------------------------------
Date Date
[The Balance of this Page Intentionally Left Blank]
23
Exhibit B, Attachment 4
Objective Retirement Product List (by Product Family)
ATTACHMENT 4: OBJECTIVE RETIREMENT PRODUCT LIST (BY PRODUCT FAMILY)
This is incorporated as Attachment 4 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
The products and services identified in each Annex to this Attachment
will or will not retire an AD's objective for the product family specified on
the Annex as indicated in the column titled "Objective Retirement".
[The Balance of this Page Intentionally Left Blank]
24
ANNEX 1: VOICE NETWORK PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 1 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and Telecomm Industries, Inc.
("AD") dated January 1, 1999.
------------------------------------------------------ -----------------------
Eligible Products and Services Objective Retirement
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech 1-800-CONFERENCE Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech 9-1-1 Locator ID Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Caller ID Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Centrex Service (Includes ISDN Centrex Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Custom Calling Services Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Digital Transport Service-Enhanced (ADTS-E) Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech DSO (except Total Access Service) No
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech DS1 (except Total Access Service) No
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech FeatureLink Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech ISDN Direct Service Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech ISDN Prime Service Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Linebacker Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Local Access Lines Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech PBX Trunks Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Remote Call Forwarding Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech SmartFax Connections Yes
------------------------------------------------------ -----------------------
------------------------------------------------------ -----------------------
Ameritech Voice Mail Yes
------------------------------------------------------ -----------------------
[The Balance of this Page Intentionally Left Blank]
25
Exhibit B, Attachment 4
Annex 2
Standard Data Products
ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 2 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and Telecomm Industries, Inc.
("AD") dated January 1, 1999.
---------------------------------------------------------------- ------------
Objective
Eligible Products and Services Retirement
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Analog Video Service Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Asynchronous Transfer Mode Service (ATM) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Broadcast Video Service Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Connectionless Broadband Data Service (CBDS) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Digital Transport Service - Enhanced (ADTS-E) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech DSO (except Total Access Service) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech DS1 (except Total Access Service) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech DS3 (except Total Access Service) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Fiber Distributed Data Interface Service (FDDI) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Fractional DS1 (384) (except Total Access Service) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Frame Relay Service (FRS) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Host Interconnection Service (AHIS) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Internet Access
(Dedicated Access over Frame Relay or CBDS) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech ISDN Direct Service Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech ISDN Prime Service Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech LAN Interconnect Service (ALIS) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Packet Switched Data Service Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Reconfiguration Service (ARS) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Remote Office Access Manager (ROAM) Yes
---------------------------------------------------------------- ------------
---------------------------------------------------------------- ------------
Ameritech Synchronized Optical Network Service (SONET) Yes
---------------------------------------------------------------- ------------
[The Balance of this Page Intentionally Left Blank]
26
Exhibit B, Attachment 4
Annex 3
Usage Products
ANNEX 3: USAGE PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 3 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and Telecomm Industries, Inc.
("AD") dated January 1, 1999.
---------------------------------------------------------- --------------------
Eligible Products and Services Objective Retirement
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech 1-800-CONFERENCE Yes
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech 9-1-1 Locator ID No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Caller ID No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Custom Calling Services No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Digital Transport Service - Enhanced (ADTS-E) No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Linebacker No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Local Access Lines No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech PrePaid Products Yes
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech PBX Trunks No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Remote Call Forwarding No
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech SmartFax Connections Yes
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech ValueLink Product Family Yes
---------------------------------------------------------- --------------------
---------------------------------------------------------- --------------------
Ameritech Voice Mail No
---------------------------------------------------------- --------------------
[The Balance of this Page Intentionally Left Blank]
27
Exhibit C
Commission
Exhibit C COMMISSION
This is incorporated as Exhibit C to the Authorized Distributor
Agreement Between Ameritech and Telecomm Industries, Inc. ("AD") dated January
1, 1999 (hereinafter the "Agreement").
1.0 General
1.1 Definitions
As used in this Agreement, the following definitions apply:
"AD of Record" shall mean the Authorized Distributor firm
credited with the sale of a new or renewed Centrex System or
PrePaid Products.
"Base Commission" shall mean the amount paid upfront to an AD
for sales of Ameritech Products. The base commission may
increase as an AD's objective increases relative to other ADs.
"Billable Revenue" shall mean those Recurring and
Non-Recurring charges which result from the customer service
order(s) which result from the sale submitted by the AD.
"Completed Orders" shall mean a "completed" status in an
Ameritech service ordering or billing systems.
"Contract Value" or "CV" shall mean the value of the Recurring
and Non-Recurring revenue charges for each product which is
used by Ameritech for purposes of establishing the value of a
sale for commission purposes.
"Eligible Product" or "Product Eligibility" shall mean those
Products the AD is authorized to promote, market and sell
under this Agreement and which are identified fully under
Exhibit B of the Agreement. AD is authorized to sell all the
Products, but only sales of those Products for which AD has an
annual sales objective will retire the AD's sales objective
for that product family.
"Migration" occurs when a customer with an existing Ameritech
Usage contract signs a new contract for a different Ameritech
Usage product, and that product is deemed solely by Ameritech
to be within the same product family as the replaced product.
"Netting" is applied to the sale of certain ValueLink products
when existing products such as, but not limited to, centrex
are already existing at that location of the customer.
28
"New" shall mean the sale of a Product to a customer who does
not currently have that specific Product and Ameritech in its
sole discretion will determine if customer currently has the
Product. To retire an AD's objective in the applicable product
family, the sale must be made in the AD's Objective Territory
and must be an Eligible Product. In no event will a sale which
is classified by Ameritech in its sole discretion as a Recast,
a Renewal, a Renegotiation, a Migration or an Upgrade be
considered a "New" sale for purposes of the Agreement.
"Non-Recurring Revenue" shall mean those one-time billed
charges which are a result of a sale by AD.
"Objective Bonus" shall mean the amount paid as the Upfront
Payment once an AD exceeds the sales volume thresholds, as
those sales volumes are stated in dollars, and which are
related to the AD's annual product family sales objective in
each state. The amount of the Objective Bonus payment may
increase over the term of this Agreement based upon the AD's
objective relative to other ADs' objectives. The Objective
Bonus payment shall apply only to New sales of Products which
retire the objective for its product family in the Objective
Territory.
"Objective Retirement" shall mean the process whereby New
sales of Ameritech Products retire the objectives for the
product family. In the event a Product retires AD's Objective
as specified under Exhibit B, Attachment 4 in more than one
product family, New sales of those products will retire the
AD's objective in one, and only one, product family in the
following order: (i) Data; (ii) Voice; and (iii) Usage. Sales
of Products which do not retire objective (see Attachments to
Exhibit B) are considered "Sales Without Objective Retirement"
for purposes of this Agreement.
"Objective Revenue" shall mean that dollar amount which is
considered the unit of measure to retire an AD's sales
objective in a product family. Objective Retirement shall
equal one month of the Recurring Revenue associated with the
New sale of a Product.
"Objective Territory" shall mean a sales area or region which
is a sub-set of AD's authorized Territory. Objective
Retirement is satisfied only by sales in AD's Objective
Territory, and Ameritech in its sole discretion will establish
and assign AD an "Objective Territory".
"Objective Tier ("Tier")" means that the AD has been assigned
to Tier I, Tier II or Tier III for purposes of commission
value calculation and Objective Retirement. Determining the
Tier the AD is assigned is at the sole discretion of
Ameritech.
"Partnering" means that the AD is not the sole sales entity in
the sales effort with a particular customer, and AD markets
Product(s) to a particular customer with another AD or
Ameritech sales representative. AD must receive prior written
approval by Ameritech for each Partnering effort, and
commission will not be paid on sales which result from such
efforts without the prior written consent of Ameritech.
Ameritech reserves the right to set commission values for each
partnering arrangement.
29
"Recast/Renewal/Renegotiation" collectively shall mean a sale
of Data or Voice, or a sales which includes data and voice,
and such sale is not classified as a New sale for purposes of
Objective Retirement or Commission Payment purposes. For
purposes of the Agreement, a sale will be deemed a Recast or a
Renewal (whichever is appropriate) when a customer signs a new
contract for a Product, and the customer already subscribes to
the same Ameritech product or to an Ameritech product which is
deemed solely by Ameritech to be similar to the Product
covered under the new contract, and the new contract extends
the customer's term commitment for the Product.
A sale will be deemed a Renegotiation when a customer enters
into a new contract with Ameritech for a Product they already
subscribe to, and the terms of the contract are substantially
changed from the contract then-in-effect for that Product, and
Ameritech determines, in its sole discretion that the sale is
eligible for commission payment to the AD at the Renegotiation
rate.
"Recurring Revenue" shall mean those monthly charges billed to
the customer for Products as a result of a sale by AD.
"Residual Payment" shall mean the commission payment which is
paid by Ameritech over time, and the time period for payment
is established by Ameritech based on contract term or other
factors relevant to the sale. Ameritech determines the amount
and payment schedule in its sole discretion.
"Takeback" shall mean commission amounts which are forfeited
or returned by the AD as a result of a customer discontinuing
its subscription to the Product(s). In the event the Takeback
is accomplished by the AD returning commissions already paid,
Ameritech will debit the AD's future commission payments by
the amount to be returned. If such a debit does not satisfy
the Takeback amount, Ameritech may demand full payment from
the AD immediately.
"Territory" is defined under Exhibit B of the Agreement and
the rules governing payment of commission for sales made to
customers outside the Territory are set forth in the
Agreement.
"Upfront Commission Payment" shall mean that portion of the
total commission paid to the AD upon Ameritech's verification
that the order(s) associated with the sale are Completed
Orders.
"Upgrade" means that a customer signs a contract for an
Ameritech Product to which the customer already subscribes, or
for a Product which Ameritech deems is similar to the Product
the customer already subscribes to, and the new contract is
for a term that extends the customer's contract term beyond
the existing contract's expiration date, and the new contract
includes a product commitment which is larger than that which
is in effect at the time of the new contract.
30
"Winback Bonus" shall mean the incremental commission amount
paid to AD because the sale of an Eligible Product is deemed
solely by Ameritech to satisfy Ameritech's criteria to be
classified as a "winback" sale as that term is understood in
the telecommunications industry.
1.2 Earned Date. AD earns the commission on any sale at the time
the commission is paid by Ameritech.
1.3 Commission Amount and Payment Schedules. The commission value
and the time of payment for each sale is based upon a number
of factors, first and foremost is the Product sold and the
terms and conditions of this Agreement. To be eligible for
commission on a specific sale, the AD must comply with all
Ameritech practices and procedures, including, but not limited
to, those related to the processing of sales and subscriber
agreements by AD, and the accuracy of each submission by AD.
Ameritech reserves the sole right to modify or change any or
all of its practices and procedures related to the AD program,
and will provide AD with a minimum of thirty (30) days prior
written Notice of any modification which will affect the AD's
own practices or procedures. Ameritech may elect to serve this
Notice via the "▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" web site and bulletin
board, and the Notice will be considered given on the date the
Notice is posted by Ameritech on the web site.
1.4 Acceptance by Ameritech. Ameritech reserves the right to
accept or reject any sale submitted by AD, and, accept or
deny, in whole or in part, any request for commission for a
specific sale. Ameritech in its sole discretion has the right
to establish the reasonable commission value of any sale.
2.0 Commission Set Off
In the event of a "Seriously Delinquent" on any AD Ameritech
account, including, but not limited to, Ameritech monthly billing
statements for service and Ameritech invoices for CPE, Ameritech may,
at its sole election, set off the amount of the delinquency by the
amount owed to AD in future commissions, including, without
limitations, Residual Payments. Ameritech's decision to set-off is
final and not subject to appeal. In the event such set-off is
necessary, Ameritech will notify AD in writing of its intent to set
off, and AD's commission statement will reflect the set-off. In no
event will Ameritech define "Seriously Delinquent" if the delinquency
is less than ninety (90) days.
3.0 Upon Termination
3.1 Ameritech Terminates. The parties agree that in the event
Ameritech exercises its right to terminate for convenience as
is provided for under Section 4.2.a of the Agreement,
Ameritech will, at its sole election, pay the Authorized
Distributor either:
a) Liquidated damages equal to a sum of the following
formula: [The amount of residual commission the AD
would be awarded if all contracts remained in effect
through the end of the contract term then in effect
provided the AD remained eligible for residual
31
payments for those customer contracts for the entire
term] x (times) [the Ameritech net present value
discount rate on the date of termination] x (times)
[seventy five percent (75%)]; or,
b) Pay on a monthly basis Residual Payment for customer
sales which are in effect and approved for commission
on the date Ameritech terminates the Agreement.
Residual Payments will continue through the
expiration date of the customer contract in effect at
the time Ameritech terminates this Agreement, or
until the original expiration date of this Agreement,
whichever is sooner.
3.2 AD Terminates. In the event AD exercises its right to
terminate the Agreement pursuant to the terms of the
Agreement, AD is not entitled to any commission payment after
the date of termination. Ameritech agrees that in
extraordinary situations a commission payment after the
termination date may be reasonable, and under such situations
Ameritech will deem at its sole discretion that the AD will
receive payment. If such a situation occurs, Ameritech will
provide to the AD in writing the amount and timing of the
payment, and the conditions or limitations on such payment(s).
3.3 Upfront Commission Payment. AD will be eligible for the
Upfront Commission Payment for any sale which is accepted by
Ameritech prior to the date this Agreement is terminated.
4.0 Commission Calculation Methodology
4.1. Calculation Basis. Ameritech will pay commissions on a sale
submitted by AD based upon:
a) The Product sold.
b) Whether the sale is deemed by Ameritech to be: (i) a
New sale or an addition to an existing service; (ii)
a Recast, Renewal or Renegotiation; (iii) a Migration
or Upgrade;
c) Whether the AD is the sole sales entity or if the
sale is the result of an approved Partnering sale as
provided for elsewhere in this Exhibit; and,
d) The order(s) which are associated with the sale
are Completed Orders.
4.2 Commission Eligibility. In no event will an AD be paid
commission on a sale: (i) outside the Territory unless such a
sale is provided for elsewhere in this Agreement and AD
receives prior written consent for such a sale pursuant to the
requirements set forth elsewhere in the Agreement; (ii) of a
product AD is not authorized to sell under the Agreement
(i.e., product or service is not specified in Exhibit B of the
Agreement); (iii) made to a customer the AD is not authorized
to sell to, including, but not limited to, an Ameritech house
account, a customer who is not deemed to be a retail business
customer, or a customer who has expressly granted agency to
another AD unless that customer has expressly, in writing
revoked such agency; and (iv) to Ameritech or to an AD or
other independent Authorized Ameritech representative.
32
4.3 Commission Award Final. Ameritech reserves the right to
establish the commission value for any sale, and that value
may, with reasonable justification, be less than, more than or
equal to the values set forth herein for such sale, or the
value previously paid for similar sales. Ameritech is solely
responsible for the determination and calculation of the
commission to be paid on any single sale, and Ameritech's
commission determination, absent arithmetic errors, is final
and not appealable.
5.0 Sales Outside of Territory and Sales Outside of "Objective Territory"
In the event the AD sells Product outside of the Territory,
and such sale has received Ameritech's prior written consent, the
commission payment for such sale will be established by Ameritech at
its sole discretion.
In the event that AD sells Product for which the AD does not
have a sales objective,(which is deemed a sale outside of Objective
Territory), the sale is subject to a twenty-five percent (25%)
reduction in the Upfront Commission Payment.
6.0 Partnering
Provided a Partnering arrangement complies with the
requirements under Article 7, Section 7.7 of the Agreement, Ameritech
will pay commission on such sales. The general commission payment
treatment for a Partnering sale is that AD will be paid an Upfront
Commission Payment equal to fifty percent (50%) of the Upfront
Commission Payment which would be paid for the same sale if no
Partnering took place. If two ADs partner, each will receive this
reduction. An exception to the general commission payment treatment for
a Partnering sale when the Partnering efforts are with an Ameritech GBS
Territory Manager, and the result of the effort is a Data Product sale,
the Upfront Commission Payment for all resulting sales will be
twenty-five percent (25%) less than the Upfront Commission Payment for
the same sale if no Partnering took place.
7.0 Centrex Product Family
For purposes of the Agreement, Products classified by
Ameritech as part of the Centrex product family will be paid commission
pursuant to this Section 7.0.
7.1 Centrex Product Family. The Centrex product family is the
collective term for the following Ameritech Centrex products:
Ameritech Centrex Service (ACS); Indiana Advanced Centrex
Service; ISDN Centrex; and, Individual Case Basis (ICB)
Centrex.
7.2 Grandfather and Sunset Offerings. Commission will not be paid
on New sales of an Ameritech Centrex offering which has been
grandfathered or sunset as those terms relate to
telecommunications offerings. Commission will be paid for
sales which are additions to an existing, installed system of
a grandfathered or sunset Centrex offering.
33
7.3 New Centrex Sales. Commission on New Centrex system sales will
be paid provided the sale results in a net increase in Centrex
station lines of at least fifteen percent (15%) of the
existing installed system. In Indiana, the Centrex station
line net increase must be at least one hundred percent (100%)
of the existing installed system.
7.4 Upfront Commission Payment Schedule
The Upfront Commission Payment schedule set forth below
applies to New Centrex system sales. The Commission Payments
are stated in terms of one Centrex station line; the actual
Commission Payment for a particular sale will be based on the
number of lines sold, and, the Commission Payment amount will
be calculated by multiplying the rate set forth below for a
single Centrex station line by the total number of station
lines sold.
---------------------------------------------------------------------------
ACS and Indiana Advanced Centrex
---------------------------------------------------------------------------
------------------ ---------------------- ------------------ --------------
Month-to-Month 36 Months 60 Months 84 Months
------------------ ---------------------- ------------------ --------------
------------------ ---------------------- ------------------ --------------
$20 $45 $65 $90
------------------ ---------------------- ------------------ --------------
---------------------------------------------------------------------------
ISDN Centrex
---------------------------------------------------------------------------
------------------ ---------------------- ------------------ --------------
Month-to-Month 36 Months 60 Months 84 Months
------------------ ---------------------- ------------------ --------------
------------------ ---------------------- ------------------ --------------
$30 $70 $100 $135
------------------ ---------------------- ------------------ --------------
---------------------------------------------------------------------------
ICB Centrex
---------------------------------------------------------------------------
------------------ ---------------------- ------------------ --------------
Month-to-Month 36 Months 60 Months 84 Months
------------------ ---------------------- ------------------ --------------
------------------ ---------------------- ------------------ --------------
$16 $36 $52 $72
------------------ ---------------------- ------------------ --------------
---------------------------------------------------------------------------
Note: ICB Centrex sales for contract lengths greater than 84
months will be awarded commission based on the 84 month
commission award.
---------------------------------------------------------------------------
7.5 Centrex Station Line Additions
a) Commission for Centrex station line additions to an
existing installed system will be awarded only to the
AD of Record unless Ameritech has approved in writing
alternative treatment of commission payments.
Ameritech will determine at its sole discretion when
there is a deviation in this payment policy.
b) The Upfront Commission Payment for Centrex station
line additions will be 50% of the commission values
in the above schedules. The Upfront Commission
Payment for Centrex station line additions to a
system which is a grandfathered or sunset offering
will be $20 regardless of type of system or contract
length.
34
7.6 Winback Bonus
If the AD makes a Centrex sale which is designated by
Ameritech as a "winback" sale, a Winback Bonus will be paid
which will increase the Base Commission by one hundred percent
(100%).
7.7 Commitment Bonus
If a new Centrex sale results in a contract which commits the
customer to a number of Centrex station lines which Ameritech
identifies in the chart that follows here as the appropriate
number of lines based upon the number of lines sold, the AD
will be eligible to receive the commitment bonus. The
commitment bonus increases the Upfront Commission Payment by
fifteen percent (15%). Ameritech, in its sole discretion, will
determine if a sale is eligible for the Commitment Bonus. The
following schedule will be used to determine the applicability
of the commitment bonus for ACS and ISDN Centrex.
--------------------------------- ----------------------------
Number of Lines Sold Number of Lines Committed
--------------------------------- ----------------------------
--------------------------------- ----------------------------
2 - 7 2
8 - 25 7
26 - 50 25
51 - 100 50
101 - 200 100
over 200 200
--------------------------------- ----------------------------
The following schedule will be used to determine the
applicability of the Commitment Bonus for Indiana Advanced
Centrex:
--------------------------------- ----------------------------
Number of Lines Sold Number of Lines Committed
--------------------------------- ----------------------------
--------------------------------- ----------------------------
11 - 21 11
22 - 101 22
102 - 251 101
252 - 1,001 251
over 1,001 1,001
--------------------------------- ----------------------------
The Commitment Bonus for ICB Centrex will be awarded if, and
only if, the number of lines committed to by the customer
equals at least eighty percent (80%) of the number of lines
sold to the customer.
7.8 Objective Retirement and Objective Attainment
For Objective Retirement purposes, the monthly contract values
used for New Centrex sales and additions to existing Centrex
systems are as follows:
35
------------------------------------------- ------------------
Centrex Service CV Per Month
------------------------------------------- ------------------
------------------------------------------- ------------------
ACS and Indiana Advanced Centrex $20
ISDN Centrex $30
ICB Centrex $16
------------------------------------------- ------------------
The following factors will be applied to the Base Upfront
Commission Payment for purposes of Objective Attainment:
--------------------------------- ----------------------------
Objective Attainment Factor
--------------------------------- ----------------------------
--------------------------------- ----------------------------
0 - 69.9% 1.00
70 - 99.9% 1.15
100% and over 1.30
--------------------------------- ----------------------------
7.9 Residual Commission Payment Schedule
A Residual Commission Payment will be paid at a rate of one
dollar ($1.00) per line, per month, and will continue for so
long as the customer's contract is in effect. In no event will
Residual Payments be paid on a month-to-month Centrex sale.
7.10 Recasts, Renewals, Renegotiations of existing Centrex
Contracts
a) The AD of Record or other Ameritech representative of
Record has the exclusive right to Renew, Recast or
Renegotiate the contract during the contract term
through sixty (60) days prior to the contract
expiration date.
b) If the customer's contract term in effect at the time
of the Recast or Renewal is more than one hundred and
eighty (180) days from the date the contract expires,
commission will not be paid to AD for a Centrex
Recast or Renewal, unless Ameritech has provided
prior written approval for such a payment. Commission
will not be paid on Centrex Renegotiations unless
Ameritech has provided written approval for such
payment prior to the date the contract was signed by
the customer.
c) After a customer contract has expired, and the
customer is under a month-to-month term for that
Product, any sale of that Product which is submitted
by AD will be considered a Recast or Renewal for
purposes of commission. If the customer contract
expired six (6) or more months prior to the AD's
submission, and the customer has been on a
month-to-month subscription for that period,
Ameritech will pay commission at the New sale rate.
d) Commission for Centrex Recasts, Renewals and
Renegotiations will be paid as follows:
(i) The Base Commission will equal 75% of the amount
paid for an identical New sale.
(ii) The Residual Commission Payment will be paid at
the same rate as an identical New Centrex sale.
36
7.11 Month-to-Month Centrex. For purposes of calculating the CV, a
month-to-month Centrex sale will be considered equal to nine
(9) months Recurring Revenue. In no event will Residual
Payments be paid on a month-to-month Centrex sale.
7.12 Takeback. The Upfront Commission Payment is subject to
Takeback in the event the customer discontinues a service (for
any or no reason) for which AD received commission in the
past. The Takeback amount will be based upon the length of
time the customer retained the service and whether the sale
was under a term contract:
a) If the sale is a term contract, and the service is
discontinued within the first fifty percent (50%) of
the contract term, the amount of Takeback will be
prorated to the length of time remaining on the
customer's contract.
b) If the sale was a month-to-month subscription, and
the customer discontinues the service within sixty
(60) days of the Completed Order date, the Takeback
amount will equal one hundred percent (100%) of the
commission paid. Residual Commission Payments cease
when a service is discontinued.
8.0 Ameritech FeatureLink.
Commission payment and conditions for payment for Ameritech
FeatureLink service are the same as those set forth above for
ACS Centrex, except that no Commitment Bonus is available for
the sale of Ameritech FeatureLink.
9.0 Other Voice Products
9.1 The commission payment schedule set forth below applies to New
sales of the following Products:
Caller ID
Custom Calling Services
Linebacker
Local Access Lines
PBX Trunks
Remote Call Forwarding
Voice Mail Service
--------------------- ----------------- ------------------------- ---------------------------------
Objective Winback Bonus
Attainment Upfront (See Note) Residual
--------------------- ----------------- ------------------------- ---------------------------------
--------------------- ----------------- ------------------------- ---------------------------------
0 - 69.9% 7.00% of CV 7.00% of CV 5.00% of Monthly Charges
70 - 99.9% 8.05% of CV 7.00% of CV 5.00% of Monthly Charges
100% and over 9.10% of CV 7.00% of CV 5.00% of Monthly Charges
--------------------- ----------------- ------------------------- ---------------------------------
---------------------------------------------------------------------------------------------------
Note: The winback bonus applies only to the sale of Local Access Lines.
---------------------------------------------------------------------------------------------------
9.2 CV. The CV for the above Products will be determined by the
following formula:
(Nonrecurring Revenue) + (Recurring Revenue x 24 Months) = CV
37
9.3 Residual Commission Payments. Residual Commission Payments
will be paid for a period of twenty four (24) months, and in
no event will AD be eligible for Residual Commission Payment
on the above Products after twenty four (24) monthly
commission payments have been made.
9.4 Conversion from Centrex Service. In no event will AD be paid
commission on a sale which converts the customer from Centrex
service (of any type) to Local Access Lines.
9.5 Takeback. If the AD received commission for a Product subject
to this Section 9.0, and the customer discontinues the Product
for any reason within one hundred and eighty (180) days after
the Completed Order date, Takeback applies, and the amount of
takeback equals one hundred percent (100%) of the commission
paid to AD.
10.0 Ameritech SmartFax Connections
10.1 Upfront Commission Payment. The following Upfront Commission
Payment schedule applies to New sales of, and "Sales of
Additions" to, Ameritech SmartFax Connections.
-------------------------------------- ----------------------
Contract Description Commission Award
-------------------------------------- ----------------------
-------------------------------------- ----------------------
No Contract (Month-to-Month) $10.00
One Year Contract $40.00
Contract Renewal $20.00
-------------------------------------- ----------------------
10.2 CV. CV is determined by the following formula:
(Nonrecurring Revenue) + (Recurring Revenue x Contract Length) = CV
10.3 Residual Commission Payment. Residual Commission Payment will
equal five percent (5%) of the monthly Recurring Revenue and
the monthly usage revenue which appears on the customer's
Ameritech local service ▇▇▇▇.
10.4 Renewal Upfront Commission Payment. In the event AD submits a
sale which is deemed by Ameritech to be a Renewal for the
Ameritech SmartFax Product, and the Renewal is submitted
within sixty (60) days from the expiration date of the
customer's then-in-effect contract for that service, the AD
will receive a Renewal Upfront Commission Payment. If the AD
converts a customer's subscription to the service from a
month-to-month to a term contract, the AD will receive
commission at the Renewal rate.
After a customer's contract has expired, and the customer is
under a month-to-month term for at least six (6) months
following the expiration, any sale submitted by AD will be
considered a New sale for purposes of commission.
38
11.0 Ameritech 9-1-1 Locator ID
11.1 Commission Schedule. Commission for this Product will be
awarded according to the following schedule:
------------------------------------ ----------------------------------------
Sale Description Commission Award
------------------------------------ ----------------------------------------
------------------------------------ ----------------------------------------
Non-Centrex
Software Only $350.00
Software and Hardware $750.00
Centrex
Software Only $250.00
Software and Technical Support $350.00
Record Loading $0.01 per record, not to exceed $250.00
------------------------------------ ----------------------------------------
11.2 CV. The CV is determined by the following formula:
(Nonrecurring Revenue) + (Recurring Revenue x Contract Length) = CV
11.3 Residual Commission Payment. No Residual Commission Payment
will be paid.
12.0 Eligible Standard Data Products
12.1 Common Provisions. The following applies to all Eligible
Standard Data Products.
a) Sales to Retail Business Customers Only. The
conditions and limitations set forth elsewhere in the
Agreement apply to the sale of Data Products. In
addition, Ameritech will not pay commission on any
network sale which is configured as terminating only
service, as that term is understood in the
telecommunications industry.
b) Eligible Standard Data Products. Eligible Standard
Data Products are specified under Exhibit B of the
Agreement, and AD's right to earn commission for
sales of Data Products as set forth below are
governed by the terms, conditions and limitations of
the Agreement and Exhibit B.
c) Recasts, Renewals, Renegotiations.
(i) If the customer's contract term-in-effect at
the time of the Recast or Renewal is more
than one hundred and eighty (180) days from
the date the contract expires, commission
will not be paid to AD for a Data Product
Recast or Renewal, unless Ameritech has
provided prior written approval for such a
payment. Commission will not be paid on Data
Product Renegotiations unless AD has
received from Ameritech written approval for
such payment prior to the date the contract
was signed by the customer.
39
(ii) After a customer contract has expired, and
the customer is under a month-to-month term
for that Product, any sale for that Product
which is submitted by AD will be considered
a Recast or Renewal for purposes of
commission. If the customer contract expired
six (6) or more months prior to the AD's
submission, and the customer has been on a
month-to-month subscription for that period,
Ameritech will be pay commission at the New
sale rate.
(iii) Commission for Data contract Recasts,
Renewals and Renegotiations will be awarded
as follows:
(a) The Base Commission will equal 50%
of the amount paid for an identical
New sale (New sale commission
payment schedule set forth below)
(b) The Residual Payment will be paid at
the same rate as an identical New
sale of the same Data Product
d) Month-to-Month Subscription. For purposes of
commission payment calculation, a month-to-month Data
sale will be considered equal to nine (9) months
Recurring Revenue. In no event will Residual Payments
be paid on a month-to-month Data sale.
e) Takeback. If the AD received commission for a Product
subject to this Section 12.0, and the customer
discontinues the Product for any reason, Takeback
applies. The amount of Takeback is based upon the
length of time the customer retained the service and
if the sale was a term contract: a) if the customer
discontinues the Product during the first fifty
percent (50%) of the contract term, the Takeback
amount will be prorated to the length of time
remaining on the customer's contract; b) if the
customer discontinues a month-to-month subscription
of the Product within sixty (60) days of
installation, the Takeback will equal one-hundred
percent (100%) of the Upfront Commission Payment.
Residual Commission Payments cease when a contract is
discontinued.
12.2 Basic Data Products
a) Commission Payment Schedule. The following commission
payment schedule applies to New sales and additions
to existing, installed services for the following
Products:
Ameritech Base Rate (BR or DS0)
Ameritech DS1
Ameritech Fractional DS1 (384)
Ameritech DS3
Ameritech ISDN Prime
Ameritech Reconfiguration Service
Ameritech Digital Transport Service -
Enhanced (ADTS-E)
40
--------------- -------------- ------------- -------------------------
Objective Winback
Attainment Upfront Bonus Residual
--------------- -------------- ------------- -------------------------
--------------- -------------- ------------- -------------------------
0 - 69.9% 8.00% of CV 8.00% of CV 5.00% of Monthly Charges
70 - 99.9% 10.00% of CV 8.00% of CV 5.00% of Monthly Charges
100% and over 12.00% of CV 8.00% of CV 5.00% of Monthly Charges
--------------- -------------- ------------- -------------------------
b) CV. The CV for the above schedule is determined by
the following formula: (Nonrecurring Revenue) +
(Recurring Revenue x Contract Length) = CV
12.3 Ameritech Analog and Broadcast Video Services
a) Ameritech Analog and Broadcast Video. The following
commission payment schedule applies to New sales and
Additions to existing installations of Ameritech
Analog and Broadcast Video services:
--------------- ---------------- ------------- -------------------------
Objective Winback
Attainment Upfront Bonus Residual
--------------- ---------------- ------------- -------------------------
--------------- ---------------- ------------- -------------------------
0 - 69.9% 7.00% of CV 7.00% of CV 5.00% of Monthly Charges
70 - 99.9% 9.00% of CV 7.00% of CV 5.00% of Monthly Charges
100% and over 11.00% of CV 7.00% of CV 5.00% of Monthly Charges
--------------- ---------------- ------------- -------------------------
b) CV. The CV for the above schedule is determined by
the following formula: (Nonrecurring Revenue) +
(Recurring Revenue x Contract Length) = CV
12.4 Complex Data Products
a) Commission Payment Schedule. The following commission
payment schedule applies to New sales and additions
to existing installations of the following Data
products:
Ameritech Synchronized Optical Network Service (SONET)
Ameritech Frame Relay Service (FRS)
Ameritech Connectionless Broadband Data Service(CBDS)
Ameritech Internet Access (Dedicated Access over FRS or CBDS)
Ameritech Remote Office Access Manager (ROAM)
Ameritech LAN Interconnection Service (ALIS)
Ameritech Host Interconnection Service (AHIS)
Ameritech Fiber Distributed Data Interface Service (FDDI)
Ameritech Asynchronous Transfer Mode Service(ATM)
-------------- --------------- ------------- -------------------------
Objective Winback
Attainment Upfront Bonus Residual
-------------- --------------- ------------- -------------------------
-------------- --------------- ------------- -------------------------
0 - 69.9% 5.00% of CV 5.00% of CV 2.00% of Monthly Charges
70 - 99.9% 7.00% of CV 5.00% of CV 2.00% of Monthly Charges
100% and over 9.00% of CV 5.00% of CV 2.00% of Monthly Charges
-------------- --------------- ------------- -------------------------
41
b) CV. The CV for the above schedule is determined by
the following formula: (Nonrecurring Revenue) +
(Recurring Revenue x Contract Length) = CV
12.5 Ameritech ISDN Direct Service
a) The following commission payment schedule applies to
New sales and additions to existing installations of
Ameritech ISDN Direct Service:
---------------- ------------------- ------------------------
Objective
Attainment Upfront Residual
---------------- ------------------- ------------------------
---------------- ------------------- ------------------------
0 - 69.9% 12.00% of CV 4.25% of Monthly Charges
70 - 99.9% 14.00% of CV 4.25% of Monthly Charges
100% and over 16.00% of CV 4.25% of Monthly Charges
---------------- ------------------- ------------------------
b) CV. The CV for the above schedule is determined by
the following formula: (Nonrecurring Revenue) +
(Recurring Revenue x Contract Length) = CV
12.6 Ameritech Packet Switched Network Service
a) The following commission payment schedule applies to
New sales and additions to existing installations of
Ameritech Packet Switched Network Service. For
purposes of the Agreement, Ameritech Packet Switched
Network Service includes x.25 direct line, and ISDN B
Channel which serves an x.25 application computer.
--------------------- -------------- ---------------------------
Objective
Attainment Upfront Residual
--------------------- -------------- ---------------------------
--------------------- -------------- ---------------------------
0 - 69.9% $750.00 5.00% of Monthly Charges
70 - 99.9% $1,000.00 5.00% of Monthly Charges
100% and over $1,250.00 5.00% of Monthly Charges
--------------------- -------------- ---------------------------
b) CV. The CV for the above schedule is determined by
the following formula: (Nonrecurring Revenue) +
(Recurring Revenue x Contract Length) = CV
13.0 ValueLink Products
13.1 For purposes of the Agreement, the Products referenced in this
Section 13.0 are collectively classified by Ameritech as the
Ameritech ValueLink product family. The conditions and
limitations regarding the sale of Products apply to the
ValueLink product family, including, without limitation, that
the AD shall not sell the Products, and is not entitled to
commission on sales to customers who are not designated by
Ameritech as retail business customers.
13.2 Month-to-month subscriptions. In no event will AD be awarded
commission for month-to-month ValueLink product sale.
42
13.3 Enhanced ValueLink Plus. The commission payment schedule
provided below applies to New sales of Enhanced ValueLink
Plus.
a) Commission Payment Schedule
------------------------------------------------------
12 Month Contract
Objective Attainment
------------------------------------------------------
------------------- ---------- -------------- ------------- --------------
Minimum Annual Upfront
Revenue Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
------------------- ---------- -------------- ------------- --------------
------------------- ---------- -------------- ------------- --------------
$300 $5 $3 $6 $7
$600 $9 $6 $11 $14
$1,200 $20 $13 $24 $29
$3,000 $49 $33 $61 $73
$6,000 $105 $70 $131 $158
$12,000 $210 $140 $263 $315
$30,000 $563 $375 $703 $844
------------------- ---------- -------------- ------------- --------------
------------------------------------------------------
24 Month Contract
Objective Attainment
------------------------------------------------------
------------------- ---------- -------------- ------------- --------------
Minimum Annual Upfront
Revenue Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
------------------- ---------- -------------- ------------- --------------
------------------- ---------- -------------- ------------- --------------
$300 $12 $8 $15 $18
$600 $24 $16 $30 $36
$1,200 $51 $34 $64 $77
$3,000 $128 $85 $159 $191
$6,000 $255 $170 $319 $383
$12,000 $525 $350 $656 $788
$30,000 $1,313 $875 $1,641 $1,969
------------------- ---------- -------------- ------------- --------------
------------------------------------------------------
36 Month Contract
Objective Attainment
------------------------------------------------------
------------------- ---------- -------------- ------------- --------------
Minimum Annual Upfront
Revenue Commitment Upfront Upfront 100% and
0 - 69.9% Residual 70 - 99.9% over
------------------- ---------- -------------- ------------- --------------
------------------- ---------- -------------- ------------- --------------
$300 $20 $14 $25 $30
$600 $41 $27 $51 $61
$1,200 $81 $54 $101 $122
$3,000 $210 $140 $263 $315
$6,000 $420 $280 $525 $630
$12,000 $900 $600 $1,125 $1,350
$30,000 $2,250 $1,500 $2,813 $3,375
------------------- ---------- -------------- ------------- --------------
b) CV. The CV for the above schedule is
determined by the following formula: (MARC)
x (Contract Length in Years) = CV
43
13.4 ValueLink Extra. The commission payment schedule below applies to
New sales of ValueLink Extra.
a) Commission Payment Schedules Without Netting
--------------------------------------------------------
24 Month Contract - Without Netting
Objective Attainment
--------------------------------------------------------
--------------- ------------ ----------- ---------------- --------------
Minimum Annual Upfront
Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
--------------- ------------ ----------- ---------------- --------------
--------------- ------------ ----------- ---------------- --------------
$25,000 $1,300 $650 $1,625 $1,950
$50,000 $2,300 $1,150 $2,875 $3,450
$75,000 $3,000 $1,500 $3,750 $4,500
$100,000 $4,000 $2,000 $5,000 $6,000
$150,000 $6,000 $3,000 $7,500 $9,000
$200,000 $8,500 $4,250 $10,625 $12,750
$300,000 $12,000 $6,000 $15,000 $18,000
$500,000 $20,000 $10,000 $25,000 $30,000
--------------- ------------ ----------- ---------------- --------------
--------------------------------------------------------
36 Month Contract - Without Netting
Objective Attainment
--------------------------------------------------------
--------------- ------------ ----------- ---------------- --------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
--------------- ------------ ----------- ---------------- --------------
--------------- ------------ ----------- ---------------- --------------
$25,000 $2,200 $1,100 $2,750 $3,300
$50,000 $4,000 $2,000 $5,000 $6,000
$75,000 $5,000 $2,500 $6,250 $7,500
$100,000 $6,500 $3,250 $8,125 $9,750
$150,000 $10,000 $5,000 $12,500 $15,000
$200,000 $13,000 $6,500 $16,250 $19,500
$300,000 $20,000 $10,000 $25,000 $30,000
$500,000 $33,000 $16,500 $41,250 $49,500
--------------- ------------ ----------- ---------------- --------------
44
b) Commission Payment Schedule With Netting
------------------------------------------------------
24 Month Contract - With Netting
Objective Attainment
---------------------------------------------------
--------------- ----------- ----------- ---------------- ---------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
--------------- ----------- ----------- ---------------- ---------------
--------------- ----------- ----------- ---------------- ---------------
$25,000 $1,040 $520 $1,300 $1,560
$50,000 $1,840 $920 $2,300 $2,760
$75,000 $2,400 $1,200 $3,000 $3,600
$100,000 $3,200 $1,600 $4,000 $4,800
$150,000 $4,800 $2,400 $6,000 $7,200
$200,000 $6,800 $3,400 $8,500 $10,200
$300,000 $9,600 $4,800 $12,000 $14,400
$500,000 $16,000 $8,000 $20,000 $24,000
--------------- ----------- ----------- ---------------- ---------------
---------------------------------------------------------
36 Month Contract - With Netting
Objective Attainment
----------------------------------------------------
--------------- ----------- ----------- ---------------- -----------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
--------------- ----------- ----------- ---------------- ---------------
--------------- ----------- ----------- ---------------- ---------------
$25,000 $1,760 $880 $2,200 $2,640
$50,000 $3,200 $1,600 $4,000 $4,800
$75,000 $4,000 $2,000 $5,000 $6,000
$100,000 $5,200 $2,600 $6,500 $7,800
$150,000 $8,000 $4,000 $10,000 $12,000
$200,000 $10,400 $5,200 $13,000 $15,600
$300,000 $16,000 $8,000 $20,000 $24,000
$500,000 $26,400 $13,200 $33,000 $39,600
--------------- ----------- ----------- ---------------- ---------------
c) CV. The CV for a contract without Netting is
determined by the following formula: (MARC) x
(Contract Length in Years) = CV
The CV for a contract with Netting is determined by
the following formula:
(Net MARC) x (Contract Length in Years) = CV
13.5 ValueLink Extra - Local. The commission payment schedule below
applies to New sales of ValueLink Extra - Local.
45
a) Commission Payment Schedule Without Netting
-----------------------------------------------------------------
24 Month Contract - Without Netting
Objective Attainment
-----------------------------------------------------------------
------------------- ---------------- ---------------- ---------------- --------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and
Commitment 0 - 69.9% Residual 70 - 99.9% over
------------------- ---------------- ---------------- ---------------- --------------
------------------- ---------------- ---------------- ---------------- --------------
$25,000 $871 $436 $1,089 $1,307
$50,000 $1,541 $771 $1,926 $2,312
$75,000 $2,010 $1,005 $2,513 $3,015
$100,000 $2,680 $1,340 $3,350 $4,020
$150,000 $4,020 $2,010 $5,025 $6,030
$200,000 $5,695 $2,848 $7,119 $8,543
$300,000 $8,040 $4,020 $10,050 $12,060
$500,000 $13,400 $6,700 $16,750 $20,100
------------------- ---------------- ---------------- ---------------- --------------
-----------------------------------------------------------------
36 Month Contract - Without Netting
Objective Attainment
-----------------------------------------------------------------
------------------- ---------------- ---------------- ---------------- --------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
------------------- ---------------- ---------------- ---------------- --------------
------------------- ---------------- ---------------- ---------------- --------------
$25,000 $1,474 $737 $1,843 $2,211
$50,000 $2,680 $1,340 $3,350 $4,020
$75,000 $3,350 $1,675 $4,188 $5,025
$100,000 $4,355 $2,178 $5,444 $6,533
$150,000 $6,700 $3,350 $8,375 $10,050
$200,000 $8,710 $4,355 $10,888 $13,065
$300,000 $13,400 $6,700 $16,750 $20,100
$500,000 $22,110 $11,055 $27,638 $33,165
------------------- ---------------- ---------------- ---------------- --------------
b) Commission Payment Schedule With Netting
-------------------------------------------------------------------
24 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$25,000 $697 $348 $871 $1,045
$50,000 $1,233 $616 $1,541 $1,849
$75,000 $1,608 $804 $2,010 $2,412
$100,000 $2,144 $1,072 $2,680 $3,216
$150,000 $3,216 $1,608 $4,020 $4,824
$200,000 $4,556 $2,278 $5,695 $6,834
$300,000 $6,432 $3,216 $8,040 $9,648
$500,000 $10,720 $5,360 $13,400 $16,080
---------------------- ---------------- ---------------- ---------------- ----------------
46
-------------------------------------------------------------------
36 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$25,000 $1,179 $590 $1,474 $1,769
$50,000 $2,144 $1,072 $2,680 $3,216
$75,000 $2,680 $1,340 $3,350 $4,020
$100,000 $3,484 $1,742 $4,355 $5,226
$150,000 $5,360 $2,680 $6,700 $8,040
$200,000 $6,968 $3,484 $8,710 $10,452
$300,000 $10,720 $5,360 $13,400 $16,080
$500,000 $17,688 $8,844 $22,110 $26,532
---------------------- ---------------- ---------------- ---------------- ----------------
c) CV. The CV for a contract without Netting is
determined by the following formula: (MARC) x
(Contract Length in Years) = CV.
The CV for a contract with Netting is determined by
the following formula:
(Net MARC) x (Contract Length in Years) = CV
13.6 ValueLink Extra-Select. The commission award and payment
schedules provided below apply to New sales of ValueLink
Extra-Select.
a) Commission Payment Schedules Without Netting
-------------------------------------------------------------------
12 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$700 $35 $18 $44 $53
$3,000 $70 $35 $88 $105
$6,000 $150 $75 $188 $225
$12,000 $325 $163 $406 $488
---------------------- ---------------- ---------------- ---------------- ----------------
-------------------------------------------------------------------
24 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$700 $75 $38 $94 $113
$3,000 $170 $85 $213 $255
$6,000 $350 $175 $438 $525
$12,000 $800 $400 $1,000 $1,200
---------------------- ---------------- ---------------- ---------------- ----------------
47
-------------------------------------------------------------------
36 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$700 $100 $50 $125 $150
$3,000 $270 $135 $338 $405
$6,000 $600 $300 $750 $900
$12,000 $1,300 $650 $1,625 $1,950
---------------------- ---------------- ---------------- ---------------- ----------------
b) Commission Payment Schedule With Netting
-------------------------------------------------------------------
12 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$700 $28 $14 $35 $42
$3,000 $56 $28 $70 $84
$6,000 $120 $60 $150 $180
$12,000 $260 $130 $325 $390
---------------------- ---------------- ---------------- ---------------- ----------------
-------------------------------------------------------------------
24 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$700 $60 $30 $75 $90
$3,000 $136 $68 $170 $204
$6,000 $280 $140 $350 $420
$12,000 $640 $320 $800 $960
---------------------- ---------------- ---------------- ---------------- ----------------
-------------------------------------------------------------------
36 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Upfront
Annual Revenue Upfront Upfront 100% and over
Commitment 0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
$700 $80 $40 $100 $120
$3,000 $216 $108 $270 $324
$6,000 $480 $240 $600 $720
$12,000 $1,040 $520 $1,300 $1,560
---------------------- ---------------- ---------------- ---------------- ----------------
c) CV. The CV for a contract without Netting is
determined by the following formula: (MARC) x
(Contract Length in Years) = CV.
48
The CV for a contract with Netting is determined by
the following formula (Net MARC) x (Contract Length
in Years) = CV
13.7 ValueLink Illinois Option F Preferred. The commission payment
schedules below applies to New sales of ValueLink Illinois
Option F Preferred.
a) Commission Payment Schedules
--------------------------------------------------------------------
12 Month Contract
Objective Attainment
--------------------------------------------------------------------
---------------------- ---------------- ---------------- ----------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ----------------- ----------------
---------------------- ---------------- ---------------- ----------------- ----------------
12,000 $18 $12 $23 $27
---------------------- ---------------- ---------------- ----------------- ----------------
--------------------------------------------------------------------
24 Month Contract
Objective Attainment
--------------------------------------------------------------------
---------------------- ---------------- ---------------- ----------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ----------------- ----------------
---------------------- ---------------- ---------------- ----------------- ----------------
12,000 $36 $24 $45 $54
---------------------- ---------------- ---------------- ----------------- ----------------
--------------------------------------------------------------------
36 Month Contract
Objective Attainment
--------------------------------------------------------------------
---------------------- ---------------- ---------------- ----------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ----------------- ----------------
---------------------- ---------------- ---------------- ----------------- ----------------
12,000 $54 $36 $68 $81
---------------------- ---------------- ---------------- ----------------- ----------------
b) CV. The CV for the above schedules is determined by
the following formula: (Minimum Annual MOU x Per
Minute Rate) x (Contract Length In Years)
49
13.8 ValueLink Illinois Option F. The commission payment schedules
below applies to New sales of ValueLink Illinois Option F.
a) Commission Payment Schedules
--------------------------------------------------------------------
12 Month Contract
Objective Attainment
--------------------------------------------------------------------
---------------------- ---------------- ---------------- ----------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ----------------- ----------------
---------------------- ---------------- ---------------- ----------------- ----------------
24,000 $38 $25 $47 $56
60,000 $90 $60 $113 $135
120,000 $165 $110 $206 $248
240,000 $300 $200 $375 $450
360,000 $405 $270 $506 $608
480,000 $488 $325 $609 $731
600,000 $540 $360 $675 $810
1,200,000 $945 $630 $1,181 $1,418
---------------------- ---------------- ---------------- ----------------- ----------------
--------------------------------------------------------------------
24 Month Contract
Objective Attainment
--------------------------------------------------------------------
---------------------- ---------------- ---------------- ----------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ----------------- ----------------
---------------------- ---------------- ---------------- ----------------- ----------------
24,000 $75 $50 $94 $113
60,000 $180 $120 $225 $270
120,000 $330 $220 $413 $495
240,000 $600 $400 $750 $900
360,000 $810 $540 $1,013 $1,215
480,000 $975 $650 $1,219 $1,463
600,000 $1,080 $720 $1,350 $1,620
1,200,000 $1,890 $1,260 $2,363 $2,835
---------------------- ---------------- ---------------- ----------------- ----------------
50
-------------------------------------------------------------------
36 Month Contract
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
24,000 $113 $75 $141 $169
60,000 $270 $180 $338 $405
120,000 $495 $330 $619 $743
240,000 $900 $600 $1,125 $1,350
360,000 $1,215 $810 $1,519 $1,823
480,000 $1,463 $975 $1,828 $2,194
600,000 $1,620 $1,080 $2,025 $2,430
1,200,000 $2,835 $1,890 $3,544 $4,253
---------------------- ---------------- ---------------- ---------------- ----------------
b) CV. The CV for the above schedules is determined by
the following formula: (Minimum Annual MOU x Per
Minute Rate) x (Contract Length In Years) = CV
[The Balance of this Page Intentionally Left Blank]
51
13.9 StraightRate Illinois. The commission payment schedule below
applies to New sales of StraightRate Illinois.
a) Commission Payment Schedules
-------------------------------------------------------------------
12 Month Contract
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
4,000 $0 $0 $0 $0
50,000 $75 $50 $94 $113
100,000 $75 $50 $94 $113
300,000 $75 $50 $94 $113
700,000 $75 $50 $94 $113
1,300,000 $75 $50 $94 $113
---------------------- ---------------- ---------------- ---------------- ----------------
-------------------------------------------------------------------
24 Month Contract
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
4,000 $0 $0 $0 $0
50,000 $150 $100 $188 $225
100,000 $150 $100 $188 $225
300,000 $150 $100 $188 $225
700,000 $150 $100 $188 $225
1,300,000 $150 $100 $188 $225
---------------------- ---------------- ---------------- ---------------- ----------------
-------------------------------------------------------------------
36 Month Contract
Objective Attainment
-------------------------------------------------------------------
---------------------- ---------------- ---------------- ---------------- ----------------
Minimum Annual
Minutes of Use Upfront
Commitment Upfront Upfront 100% and over
0 - 69.9% Residual 70 - 99.9%
---------------------- ---------------- ---------------- ---------------- ----------------
---------------------- ---------------- ---------------- ---------------- ----------------
4,000 $0 $0 $0 $0
50,000 $225 $150 $281 $338
100,000 $225 $150 $281 $338
300,000 $225 $150 $281 $338
700,000 $225 $150 $281 $338
1,300,000 $225 $150 $281 $338
---------------------- ---------------- ---------------- ---------------- ----------------
b) CV. The CV for the above schedules is determined by
the following formula: (Minimum Annual MOU x Per
Minute Rate) x (Contract Length In Years) = CV
52
13.10 ValueLink Extra - HQ - Individual Case Basis (ICB) Usage. The
following commission payment schedule applies to New sales of
ValueLink Extra - HQ - Individual Case Basis (ICB) Usage
contracts:
a) Upfront Commission Payment Schedule
-------------------------------------------------------------------
ValueLink Extra - HQ - ICB
Objective Attainment
-------------------------------------------------------------------
---------------------- --------------------- ---------------------- ----------------------
Contract
Length 0 - 69.9% 70 - 99.9% 100% and over
---------------------- --------------------- ---------------------- ----------------------
---------------------- --------------------- ---------------------- ----------------------
24 Months 0.50 x MBRC 0.65 x MBRC 0.75 x MBRC
36 Months 0.65 x MBRC 0.80 x MBRC 1.00 x MBRC
---------------------- --------------------- ---------------------- ----------------------
b) CV. The CV for the above schedule is determined by
the following formula: (MBRC) x (Contract Length In
Months) = CV
c) Residual Commission Payment. No residual commissions
will be paid for ValueLink Extra - HQ - ICB Usage
sales.
d) Contract term greater than 36 months. If a ValueLink
Extra - HQ - ICB Usage sale is for a contract with a
term greater than thirty six (36) months, the
commission payment for such a sale will use the
Commission Payment Schedule set forth above for a
thirty six (36) month ValueLink Extra - HQ - ICB
Usage sale.
13.11 Contract Upgrade or Migration
a) Commission Payment
(i) When both the Product sold and the Ameritech
product or service which is being replaced are both
specified in Exhibit B as "Products" for purposes of
the Agreement, the Upfront Commission Payment for a
sale deemed by Ameritech as an Upgrade or a Migration
will be determined by the following formula:
(Current Base Upfront Commission for New Product)
- (minus)
(Current Base Upfront Commission for Old Product)
= Upfront Commission Payment
(ii) When a sale for a Product is replacing an
Ameritech product or service which is not specified
in Exhibit B as a "Product", the Upfront Commission
Payment for the sale (whether it is deemed an Upgrade
or a Migration) is determined by the following
formula: (Current Base Upfront Commission for New
Product) x (50%) = Upfront Commission Payment
53
b) Does Not Retire Objective. Neither an Upgrade nor a
Migration will serve to retire the AD's Usage Product
family objective, and neither an Upgrade nor a
Migration is subject to an Objective Bonus.
c) Residual Commission Payment. The Residual Commission
Payment for an Upgrade or a Migration will be
calculated in the same manner and at the same rate as
a New sale of the Product. In every case, the
Residual Commission Payment, if any, for the product
or service which is being replaced as the result of
the Upgrade or Migration will be discontinued
effective the date of the Completed Order.
13.12 Takeback. If the AD received commission for a Product subject
to this Section 13.0, and the customer discontinues the
Product for any reason, Takeback applies. If the customer
discontinues a Product within one-hundred and eighty days
after the Completed Order date, the Takeback will equal
one-hundred percent (100%) of the Upfront Commission Payment.
Residual commissions cease effective the date the customer
cancels the product.
14.0 1-800-CONFERENCE
14.1 Commission Payment Schedule. Sales of 1-800-CONFERENCE consist
only of an Upfront Commission Payment, and no Residual Payment
applies.
a) Non-ICB Term Contract Sale. The following commission
payment schedule applies to sales under which the customer
signs a term agreement which is not an ICB contract for
1-800-CONFERENCE service:
----------------------- ---------------------- --------------------- ---------------------
Minimum
Annual Revenue
Commitment 1 Year Contract 2 Year Contract 3 Year Contract
----------------------- ---------------------- --------------------- ---------------------
----------------------- ---------------------- --------------------- ---------------------
$1,500 $120 $300 $450
$3,000 $240 $600 $900
$6,000 $480 $1,200 $1,800
$15,000 $1,200 $3,000 $4,500
$24,000 $1,920 $4,800 $7,200
----------------------- ---------------------- --------------------- ---------------------
b) CV. The CV is determined by the following formula:
(Annual Revenue Commitment) x (Contract Length In
Years) = CV
c) ICB Term Contract Sale. The commission to be paid for
an ICB term contract sale for 1-800-CONFERENCE
service will be arrived at through the following
formula: (CV) x (Ten-Percent (10%)) = Commission
Payment
54
14.2 Objective Attainment. For purposes of Objective Attainment,
the following factors will be applied to the Base Commission
Payment to arrive at the Objective Attainment number:
---------------------------- ----------
Objective Attainment Factor
---------------------------- ----------
---------------------------- ----------
0 - 69.9% 1.00
70 - 99.9% 1.25
100% and over 1.50
---------------------------- ----------
15.0 Ameritech Prepaid Products
15.1 Commission Payment. The AD of Record will be paid commission
for PrePaid Product sales. If the customer places orders for
additional Product, the AD of Record will be paid for those
additional sales whether the customer places the order with
the AD or with Ameritech's PrePaid product support
organization.
15.2 Commission Value. The Base Commission value and the Upfront
Commission Payment for a sale will equal ten percent (10%) of
the gross value of the sale, net of taxes whether it is the
original sale or a subsequent sale as provided for under
Section 15.1 above. No Residual Commission Payment applies to
PrePaid Products.
15.3 Objective Attainment. For purposes of objective attainment,
the following factors will be applied to the Base
Commission:
---------------------------- ----------------
Objective Attainment Factor
---------------------------- ----------------
---------------------------- ----------------
0 - 69.9% 1.00
70 - 99.9% 1.25
100% and over 1.50
---------------------------- ----------------
[The Balance of this Page Intentionally Left Blank]
55
Exhibit D
COOP & 5-STAR PROGRAM
Exhibit D CO-OP AND 5-STAR PROGRAM
This is Exhibit D to the Authorized Distributor Agreement between
Telecomm Industries, Inc. ("AD") and Ameritech, effective January 1, 1999, and
this Exhibit is incorporated into the Agreement by reference.
Ameritech provides incentive programs as an integral part of the
Agreement. The "Co-Op Program" and the "5-Star Program" is governed by the rules
and regulations which are fully set forth in a document titled "Ameritech
Authorized Distributor Co-Op and 5-Star Program", and said document is dated
"January 1999, and said document is incorporated herein as if originally set
forth here as Exhibit D. The Co-Op and 5-Star Program may be modified during the
term of the Agreement, and such modification is governed by the terms of the
Agreement, and each modification is incorporated by reference herein on the date
the modification is effective.
[The Balance of this Page Intentionally Left Blank]
56
Exhibit E
Code of Business Conduct
Exhibit E CODE OF BUSINESS CONDUCT
This is Exhibit E to the Authorized Distributor Agreement between
Telecomm Industries, Inc. ("AD") and Ameritech effective January 1, 1999, and
this Exhibit is incorporated into the Agreement by reference.
1. Every Authorized Distributor has the professional responsibility of fair
dealing towards Ameritech's customers, past and present, fellow Authorized
Distributors, and the general public.
2. Every Authorized Distributor has the professional responsibility of adhering
to generally accepted standards of accuracy and truth.
3. An Authorized Distributor shall not place itself in a position where the
Authorized Distributors interest is, or may be, in conflict with its duty to the
customer or Ameritech.
4. Each Authorized Distributor shall safeguard the confidence of both present
and former customers/clients, and shall not disclose or use these confidences to
disadvantage or prejudice such clients.
5. An Authorized Distributor shall not intentionally disseminate false or
misleading information, and each Authorized Distributor is obligated to use
appropriate means to avoid dissemination of false or misleading information.
6. An Authorized Distributor shall not disparage the professional reputation or
practice of another Authorized Distributor.
7. Each Authorized Distributor's employees shall be treated as individuals with
respect to their dignity and recognition of their merit.
[The Balance of this Page Intentionally Left Blank]
57
Exhibit F
House Accounts
Exhibit F HOUSE ACCOUNTS
This is Exhibit F to the Authorized Distributor Agreement between
Telecomm Industries, Inc. ("AD") and Ameritech effective January 1, 1999, and
this Exhibit is incorporated by reference therein.
House Accounts
Pursuant to Article 1, Section 1.7, the Customer accounts which
Ameritech designates, in its sole discretion, as "House Accounts" are listed on
the web site "▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇", and said list is incorporated by reference
as if set forth fully herein, as modified from time-to-time by Ameritech, and
each such modification is deemed incorporated as if set forth originally herein.
[The Balance of this Page Intentionally Left Blank]
58