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EXHIBIT 10.52
SALES AGENCY AGREEMENT/
CONFIDENTIAL REDACTED VERSION
FOR
THE SALE OF TELECOMMUNICATIONS SERVICES
This Sales Agency Agreement (THE "AGREEMENT") is made and entered into
as of the 1st day of June, 1995 (THE "EFFECTIVE DATE") by and between WorldCom,
Inc. d/b/a LDDS WorldCom ("LDDS"), a Georgia corporation with its place of
business in East Rutherford, New Jersey and CONSORTIUM 2000 ("SALES AGENCY") ,
a California corporation with its principal place of business in Culver City,
California and whose Federal Tax Identification Number is 00-0000000. For and
in consideration of the mutual promises and covenants set forth hereinafter,
the parties agree as follows:
1. PRIOR AGREEMENT
a. The parties acknowledge there currently exists between them a
Master Sales Agency Agreement for the Sale of
Telecommunications Services dated November 1, 1993 between
Sales Agency and WorldCom Network Services, Inc. (formerly
WilTel, Inc.), an LDDS affiliate, as amended by that certain
Addendum dated January 11, 1994, that certain Amended and
Restated Appendix D dated March 25, 1994 and that certain
Modification to that Certain Amended and Restated Appendix D
dated September 28, 1994 (COLLECTIVELY, THE "PRIOR
AGREEMENT"). As of the date of this Agreement, the parties
agree that the Prior Agreement shall be null and void.
b. Notwithstanding anything to the contrary contained in
Subsection 1(a) above, LDDS agrees to pay the following
commissions (COLLECTIVELY, THE "PRIOR COMMISSIONS") on the net
(i.e., after the application of discounts, if any) monthly
measured usage charges for Switched Services sold by Sales
Agency under the Prior Agreement with respect to those End
Users listed on Schedule 1, which is attached hereto and
incorporated herein by reference ("EXISTING CUSTOMERS"), or
with respect to those current prospects as of the date of this
Agreement which have been specifically identified by Sales
Agency and approved by LDDS and which are listed on Schedule
1A, which is attached hereto and incorporated herein by
reference ("POTENTIAL CUSTOMERS"):
(i) * on all WilPLUS IV, Option 1 Service sold by
Sales Agency to Existing Customers under the Prior
Agreement on or before July 19, 1994;
* AN ASTERISK in this document indicates that the portion of the text so marked
is confidential and has been omitted and filed separately with the Securities
and Exchange Commission.
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(ii) * on all WilPLUS IV, Option 1 Service sold by
Sales Agency to Existing Customers under the Prior
Agreement after July 19, 1994;
(iii) * on all Switched Services sold by Sales
Agency to Potential Customers; and
(iv) * on all Switched Services sold by Sales
Agency to Pioneer Financial Services, Inc.
("PIONEER").
c. The Prior Commissions will continue to be paid by LDDS as long
as the end users associated with the Prior Commissions remain
an LDDS customer subject to Subsections 5(a)and 5(b) below;
provided, however, LDDS reserves the right, exercisable in its
sole discretion, to adjust or revise the monthly measured
usage charges of Existing Customers (including Pioneer and
Potential Customers) in the event of toll fraud, PIC disputes
or any other extraordinary event including without limitation,
bad debt.
2. RELATIONSHIP
a. LDDS appoints Sales Agency (and Sales Agency accepts such
appointment) as its non-exclusive authorized sales
representative for the sale of LDDS' telecommunications
services listed in Article I of Appendix A which is attached
hereto and incorporated herein by reference and as may be
amended from time to time (THE "SERVICES") to residential and
commercial end users (HEREINAFTER REFERRED TO AS "CUSTOMERS").
b. LDDS reserves the right to add, discontinue, supersede or
alter any of the Services subject to this Agreement, including
but not limited to the charges for such Services. Such right
may be exercised by LDDS at any time during the Initial Term
of this Agreement or any extension thereof. Any successor
Services (which will not include any new or additional
Services) ("SUCCESSOR SERVICES") may be sold by Sales Agency
during the Initial Term (and any extensions thereof) of this
Agreement; provided, however, LDDS reserves the right,
exercisable in its sole discretion, to adjust the amount of
Commissions (as described in Section 5) to be paid to Sales
Agency relative to such Successor Services.
c. Sales Agent's use of the term "AUTHORIZED SALES AGENCY OF
LDDS" will only be as specified in Section 9 of this Agreement
entitled "Authorized Use of LDDS Name". Sales Agency will
only identify itself as an Authorized Sales Agency of LDDS
with respect to the Services and in all
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other cases will identify itself as an independent business.
d. Neither party hereto is an employee of the other and neither
has any right nor any authority to act on behalf of the other
beyond that expressly granted herein. Sales Agency shall
conduct its business at its own initiative, responsibility and
expense.
e. During the Initial Term of this Agreement and any extension
thereof, LDDS reserves the right, without obligation or
liability to Sales Agency for payment of compensation or
otherwise, to market the Services, whether through its own
employees, agents or representatives, through other
independent representative(s), or otherwise.
f. Provided Sales Agency complies with Subsection 5(m) below,
Sales Agency may telemarket the Services provided such
telemarketing (including verification of orders obtained
therefrom) conforms with applicable FCC and state regulations,
including without limitation the regulations promulgated by
the FCC in 47 C.F.R., Part 64, Subpart K. Section 64.1100 or
any successor regulations. For the purposes of this
Agreement, "telemarketing" shall mean developing customer
leads by "cold calling" potential customers over the telephone
and shall include without limitation the utilization of
telemarketing centers and the canvassing of potential
customers by means of auto dialers or similar methods.
3. TERM
a. This Agreement shall become effective as of the Effective Date
and shall continue in effect for a period of five (5) years
(THE "INITIAL TERM") , subject to cancellation by either party
at any time during the Initial Term upon not less than ninety
(90) days written notice to the other party. Upon expiration
of the Initial Term, unless terminated as provided in
Subsection (b) below, this Agreement shall automatically
continue in force on a month-to-month basis subject to
termination by either party on thirty (30) days written
notice.
b. LDDS may terminate this Agreement (i) if Sales Agency becomes
insolvent, makes an assignment for the benefit of creditors or
files a petition for reorganization; (ii) if a petition in
bankruptcy is filed by or against Sales Agency; or (iii) if
Sales Agency is in breach of this Agreement or is otherwise in
default to LDDS or any LDDS parent, subsidiary or affiliated
company under this or any other agreement which default is not
cured within any applicable cure period. LDDS agrees to give
Sales Agency (x) seven (7) days notice in which to cure a
default under Subsections 2(f), 3(c), 6(f) and 13(a), and (y)
thirty (30) days notice in which to cure any other default
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hereunder. Any notice period given under this Subsection (b)
shall be without prejudice for any claim for damages or any
other right of LDDS under this Agreement at the time of such
termination.
c. Customers obtaining Services sold by Sales Agency shall be
customers of LDDS in all respects and Sales Agent shall have
no property right in such Customers. During the Initial Term
(and any extensions thereof), Sales Agency agrees not to
contact any Customers for the purpose of inducing them to
switch to another long distance services provider.
4. EXCLUDED ACCOUNTS/EXCLUSIVE TERRITORY
For purposes of this Agreement, subject to Section 1 above, LDDS
hereby excludes (i.e., Sales Agency shall not receive a Commission on)
any sales to the following Customers (HEREINAFTER COLLECTIVELY
REFERRED TO AS "EXCLUDED ACCOUNTS"):
(i) Customers for which an order was placed for the
installation of Service by Sales Agency prior to the
date of this Agreement.
(ii) Customers for which a prior order was placed with
LDDS by someone other than Sales Agency (which shall
include delivery to LDDS of a services agreement
directly by a Customer) subject to the sole
discretion of LDDS.
(iii) Customers outside the geographic territory described
in Article II of Appendix A, which is attached hereto
and incorporated herein by reference (THE "AUTHORIZED
TERRITORY").
(iv) As provided in the applicable Commission Plan (as
defined below) as may be amended from to time.
(v) From time to time, any specific customers, potential
customers or end users (which includes working
telephone numbers (WTNs), billed telephone numbers
(BTNs) and automatic number identifications ("ANIs"))
of which Sales Agency has received at least thirty
(30) days' notice from LDDS.
5. COMMISSION
a. LDDS agrees to pay Sales Agency a commission on collected
revenues (THE "COMMISSION") pursuant to the schedule, terms
and conditions set forth in this Agreement and Article III of
Appendix A attached hereto and incorporated herein by
reference (THE "COMMISSION PLAN"), for the sale of Service to
any Customer within the Authorized
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Territory, that is not an Excluded Account as described in
Section 4 above.
b . Notwithstanding the Commission Plan described in Article III
of Appendix A, upon (i) the scheduled expiration of the
Initial Term of this Agreement as defined in Subsection 3(a)
above, (ii) LDDS' early cancellation of this Agreement upon
ninety (90) days' notice pursuant to Subsection 3(a) above,
or (iii) LDDS' termination of this Agreement pursuant to
Subsection 3(b) above, LDDS will continue paying Sales Agency
the following Commission based on the Aggregate Monthly Volume
(as defined in Article III of Appendix A) for Switched
Services sold by Sales Agency to Customers during the Initial
Term who remain LDDS Customers after the scheduled expiration
or early cancellation of the Initial Term:
Aggregrate Amount Commission
----------------- ----------
$250,000+ *
$200,000 - $249,999 *
$150,000 - $199,999 *
$100,000 - $149,999 *
$ 50,000 - $ 99,999 *
$ 0 - $ 49,999 *
c. Sales Agency will receive a Commission upon execution by a
Customer of an approved LDDS service agreement ("SERVICE
AGREEMENT") , as may be amended from time to time by LDDS.
Commissions will be paid (i) within forty-five (45) days after
the end of the month in which Customers are billed by LDDS,
and (ii) only so long as the Service remains installed.
"INSTALLED SERVICE" shall mean the completion of the
activation of facilities and placement of equipment, if any,
necessary for LDDS to provide the Service in question. LDDS
shall have no liability for and Sales Agency shall not be
entitled to Commissions for any Service ordered by Service
Contract but not installed, even if such failure is due to the
acts or omissions of LDDS.
d. Commission advances will be calculated at one hundred percent
(100%) of the billed revenue, that is, after taking into
account the application of any discounts. Provided, however,
in the event a Customer does not pay an invoice in full within
ninety (90) days after the relevant invoice date ("DELINQUENT
CUSTOMER"), LDDS may, at its sole option, deduct from the
amount owed Sales Agency an amount equal to the Commissions
paid on all then past due amounts attributable to said
Delinquent Customer. Further, LDDS will not pay any future
Commissions with respect to said Delinquent Customer.
However, as soon as the Delinquent Customer is current on all
LDDS invoices, LDDS will (i) resume paying Commissions as
provided herein with respect to said Delinquent Customer, and
(ii) pay all
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Commissions deducted from Sales Agency (if any) due to such
Delinquent Customer. In the event a Customer cancels Service
prior to the end of any minimum term liability associated with
such Service, Sales Agency shall be entitled to a pro rata
share of the amount, if any, received by LDDS as a
cancellation charge, provided payment therefor is received by
LDDS within sixty (60) days of the invoice date for the
cancellation charge in question.
e. Remittance of all Commissions due Sales Agency will be
according to the Commission Plan. A monthly statement listing
all sales of Services for which Sales Agency is being paid a
Commission will be provided by LDDS. All remittances shall be
paid by LDDS in U.S. dollars.
f. LDDS reserves the right not to pay Sales Agency Commissions in
the event more than ten percent (10%) of the Services sold
hereunder are used directly or indirectly by Sales Agency or
any affiliate of Sales Agency. Further, Sales Agency shall
not use any portion of the Commission in order to offer any
Customer a rebate, credit, or other similar form of
compensation.
g. LDDS reserves the right, exercisable in its sole discretion,
to adjust or revise the monthly measured usage charges of
Customers in the event of toll fraud, PIC disputes or any
other extraordinary event including without limitation, bad
debt.
h. Sales Agency will be solely responsible for the payment of
taxes and other fees that may be due as a result of LDDS'
payment of a Commission as described herein.
i. LDDS shall have the right to set off against any payment due by
it hereunder (including without limitation, Commissions due
pursuant to this Section 5) any amounts owed to it by Sales
Agency under this Agreement or any other agreement between
Sales Agency and LDDS or Sales Agency and any parent,
subsidiary or affiliated company of LDDS, including without
limitation, Disputed Transfer Charges (as described in
Subsection 6(m) below). If, for any reason whatsoever
(including without limitation, termination of this Agreement),
at the end of any calendar month any amount is due LDDS from
Sales Agency, LDDS may, at its option, demand that such amount
be paid to it in cash by Sales Agency within thirty (30) days
after the last day of such calendar month.
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6. SALES AGENCY'S RESPONSIBILITIES
Sales Agency agrees to:
a. Sell and take orders for LDDS' tariffed offerings as further
described in Article I of Appendix A in coordination with LDDS
as appropriate and necessary.
b. Upon request, provide LDDS for its review all proposals for
the Services and permit LDDS to conduct periodic sales reviews
and account reviews with Sales Agency.
c. Establish and maintain a trained and capable sales force
necessary to sell the Services. Sales Agency further agrees
that such sales force shall meet all reasonable quality and/or
certification standards which may be established by LDDS from
time to time.
d. Sell the Services to non-Excluded Accounts in Sales Agency's
Authorized Territory in accordance with the prices, terms and
conditions set forth in the applicable tariffs, price lists
and Service Contracts of LDDS, as may be amended from time to
time; provided, it is understood that LDDS is under no
obligation to provide nontariffed pricing or nontariffed
Service to any Customers or potential customers.
e. Make only such representations concerning the price, tariff,
contract terms and conditions, functions, capabilities,
characteristics, design, installation date or availability of
any Services that have been approved by LDDS.
f. Market the Services in a manner consistent with the standard
for marketing of such Services which LDDS shall specify as
necessary to protect service marks or trade names used in
connection with the Services. All activities of Sales Agency
hereunder shall be in compliance with such sales, service and
engineering standards promulgated by LDDS which are then in
effect. Provided, Sales Agency may only use those marketing
and sales material which have been (i) supplied by LDDS, or
(ii) produced by Sales Agency and prior approved by LDDS. In
the event LDDS determines, in its sole discretion, that
certain of Sales Agency's marketing or sales practices are
misleading or otherwise objectionable, LDDS shall notify Sales
Agency in writing to immediately cease such activities. In
the event such activities continue, LDDS will have the right
to terminate this Agreement in accordance with Subsection 3(b)
above.
g. Use commercially reasonable efforts at all times to give
prompt, courteous and efficient service to Customers, act in
accordance with the highest standards of honesty, integrity
and fair dealing in all dealings with such
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Customers and LDDS, and do nothing which would tend to
discredit, dishonor, reflect adversely upon or in any manner
injure the reputation of LDDS.
h. Explain the Services and advise Customers on the use of such
Services and, if applicable, the compatibility of the Services
with other LDDS products and services offered for sale by
Sales Agency.
i. Notify LDDS immediately upon notice to it of any Customer
attempting to cancel any Service Contract delivered by Sales
Agency.
j. Provide LDDS with a 24 hour seven day per week maintenance
number to which LDDS will be able to call toll free to report
Service problems following installation or any other inquires
regarding the maintenance of Service. Sales Agency will make
available to LDDS qualified personnel on a full-time basis who
are capable of clearing service problems and coordinating the
resolution of maintenance or Service problems with LDDS's
Customer Service and Service maintenance personnel.
k. Maintain insurance coverage in amounts and according to the
terms set forth in Appendix B, which is attached hereto and
incorporated herein by reference.
l. Maintain documents and records ("RECORDS") supporting the
sales of Services which are the subject of this Agreement for
a period of not less than twelve (12) months or such other
longer period as may be required by applicable law, rule or
regulation and which are capable of being produced within a
reasonable period of time upon the request of LDDS.
m. Obtain appropriate and valid letters of agency in writing
("LOA") from all Customers in the form prescribed by LDDS
which will designate LDDS as Customer's "Primary Interexchange
Carrier", and submit to LDDS such LOAs duly executed by
Customers with each Order submitted by Sales Agency. LDDS
reserves the right to verify, in a manner determined solely by
LDDS, any or all LOAs submitted by Customer. In the event
there are disputed transfers in connection with Customers
obtained by Sales Agency for whatever reason, Sales Agency
will be responsible for (i) all reasonable charges incurred by
LDDS to transfer Customers to the LDDS network in accordance
with standard LEC charges, (ii) all reasonable charges
incurred by LDDS to transfer Customers back to their previous
interexchange carrier in accordance with standard LEC charges,
(iii) all reasonable measured usage charges repaid to Customer
as determined in the sole discretion of LDDS, and (iv) any
other reasonable damages suffered by or awards against LDDS
resulting from disputed transfers (COLLECTIVELY, THE "DISPUTED
TRANSFER CHARGES").
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n. Cooperate fully, at LDDS's expense, in the collection,
compilation and maintenance of data required to be reported by
LDDS pursuant to any federal or state statute, regulation or
order. LDDS represents that to the best of its knowledge, as
of the date of this Agreement, there are no reporting
requirements imposed on LDDS which require cooperation of
Sales Agency other than in completing standard sales documents
and maintaining Records.
7. SERVICES BY LDDS
a. LDDS may, in its sole discretion, offer the following services
(at a cost, if any, to be borne by Sales Agency if Sales Agency agrees
to such services):
(i) Marketing of the Services and the provision of
promotional literature to Sales Agency in such
quantities as LDDS deems appropriate.
(ii) The provision of training to Sales Agency's employees
to the extent determined by LDDS.
(iii) The provision of technical support to Sales Agency's
personnel to the extent determined by LDDS.
b. LDDS also agrees to perform, directly or through a third
party, the following functions:
(i) Credit approvals and credit limit updates, billing
and commercially reasonable collection functions for
the Services sold by Sales Agency under this
Agreement.
(ii) Install, maintain and support the Service(s) sold by
Sales Agency pursuant to this Agreement in accordance
with LDDS's applicable tariffs and Service Contracts.
Provided, however, LDDS shall have no responsibility
for or liability in connection with any other
services or products sold by Sales Agency. LDDS
reserves the right to deal directly with the
Customer(s) in all matters, including but not limited
to those involving the installation, maintenance,
support and removal of the Services. Provided,
further, Sales Agency shall receive commission credit
for sales arising from such dealings which are not
otherwise restricted under Section 5 above.
8. SERVICE ORDERING PROCEDURES, CREDIT AND CANCELLATION OF SERVICE
a. From time to time, LDDS shall inform Sales Agency of the terms
on which it is willing to accept orders ("ORDERS") for the
Services, including Customer payment, standards
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of Customer creditworthiness, standard installation intervals,
physical availability of facilities, order and Service
Contract format, data requirements and other specifications as
to the manner of conducting business.
b. Sales Agency shall submit all Orders for Services to provided
by LDDS on completed Service Contracts which have been prior
approved by LDDS. LDDS agrees to receive and process Service
Contracts for Services from Sales Agency through its
centralized customer service group ("LDDS SUPPORT GROUP") in
accordance with its normal practices.
c. All Orders for Services shall be subject to (i) the
availability of suitable facilities which shall be determined
in the sole discretion of LDDS, and (ii) the approval and
acceptance by LDDS in accordance with its common carrier
rights and obligations. LDDS reserves the right, exercisable
in its sole discretion, to (i) reject any Order submitted by
Sales Agency, or (ii) discontinue offering or selling any
Service to any Customer. In the event of such rejection or
discontinuance, LDDS shall not incur any liability to Sales
Agency.
d. LDDS reserves the right to independently verify the
creditworthiness of any Customer and to reject any Customer,
before or after the Service Contract is accepted by LDDS on
the basis of its credit history or financial condition.
e. LDDS reserves the right to require a deposit, secured
collateralizations, or letters of credit, from any Customer in
an amount to be determined by LDDS, in its sole discretion,
based on the estimated usage of the Customer. Further, LDDS
may increase the amount of the deposit in the event Customer's
usage exceeds said usage estimate.
f. LDDS reserves the right to cancel Service to any Customer for
non-payment or other cause in accordance with applicable
Service Contracts or LDDS tariff.
9. AUTHORIZED USE OF LDDS NAME
a. Sales Agency may refer to itself during the term of this
Agreement as an "AUTHORIZED LDDS SALES AGENCY" solely in
connection with Services sold by Sales Agency hereunder.
Further, LDDS grants Sales Agency a limited license to use its
name and federally registered and protected service marks (and
any other service marks authorized by LDDS) solely for the
purpose of obtaining Customers under this Agreement; provided,
however, any use by Sales Agency of LDDS' name and service
marks must be prior approved, in writing, by LDDS.
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b. Sales Agency shall refer to itself as an authorized agent of
LDDS whenever it refers to the Services in promotional,
advertising, or other materials. In addition, Sales Agency
shall provide to LDDS for its prior review and written
approval, which approval may be withheld for any reason, all
promotions, advertising or other materials or activity using
or displaying LDDS' name, the Services or referring to Sales
Agency as an authorized agent of LDDS. Sales Agency agrees to
change or correct, at Sales Agency's expense, any such
material or activity which LDDS, in its sole judgment,
determines to be inaccurate, misleading or otherwise
objectionable.
c. Upon expiration or termination of this Agreement for whatever
reason, Sales Agency shall immediately cease referring to
itself as an "Authorized LDDS Sales Agency."
10. CONFIDENTIAL INFORMATION
a. The parties understand and agree that the terms and conditions
of this Agreement, all documents referenced herein (including
invoices to Customers for Service), communications between the
parties regarding this Agreement or the Services described
herein (including price quotes by LDDS for any Services
proposed to be provided or actually provided to a Customer),
Customer information and information relevant to any other
agreement between the parties (COLLECTIVELY "CONFIDENTIAL
INFORMATION"), are confidential as between Sales Agency and
LDDS.
b. A party shall not disclose Confidential Information unless
subject to discovery or disclosure pursuant to legal process,
or to any other party other than the directors, officers, and
employees of a party or agents of a party including their
respective brokers, lenders, insurance carriers or prospective
purchasers who have specifically agreed in writing to
nondisclosure of the terms and conditions hereof. Any
disclosure hereof required by legal process shall only be made
after providing the non-disclosing party with notice thereof in
order to permit the non-disclosing party to seek an
appropriate protective order or exemption. Violation by a
party or its agents of the foregoing provisions shall entitle
the non-disclosing party, at its option, to obtain injunctive
relief without a showing of irreparable harm or injury and
without bond.
c. The parties further agree that any press release,
advertisement or publication generated by a party regarding
this Agreement, the Service provided hereunder or in which a
party desires to mention the name of the other party or the
other party's parent or affiliated company(ies), will be
submitted to the non-publishing party for its written approval
prior to publication.
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d. The provisions of this Section 10 will be effective as of the
date of this Agreement and remain in full force and effect for
a period equal to the longer of: (i) one (1) year following
the Effective Date of this Agreement; or (ii) one (1) year
following the termination of all Commissions due Customer
hereunder.
e. Within ten (10) days after the expiration of this Agreement or
the termination of this Agreement by either party for any
reason, each party shall return to the other any physical or
written records containing such confidential information of
the other then in its possession, regardless of whether such
physical or written records were prepared by Sales Agency or
by LDDS.
11. INDEMNIFICATION Sales Agency agrees to indemnify and hold LDDS
harmless from any and all claims, actions, damages, expenses and other
liabilities, including reasonable attorney's fees and costs of litigation,
resulting from Sales Agency's acts, omissions or misrepresentations, regardless
of the form of action, including, but not limited to any Disputed Transfer
charges from local exchange carriers incurred by LDDS for primary interexchange
carrier ("PIC") selection for which Sales Agency cannot produce an appropriate
and valid LOA relevant to the PIC charge in question.
12. LIMITED LIABILITY IN NO EVENT WILL LDDS' PERFORMANCE OR FAILURE TO
PERFORM ITS OBLIGATIONS HEREUNDER (INCLUDING WITHOUT LIMITATION, LDDS' GROSS
NEGLIGENCE OR WILFUL MISCONDUCT) RESULT IN LDDS' LIABILITY TO SALES AGENCY OR
ANY THIRD PARTY FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE OR
CONSEQUENTIAL LOSSES OR DAMAGES, INCLUDING WITHOUT LIMITATION, LOSS OF REVENUE,
LOSS OF CUSTOMERS OR CLIENTS, LOSS OF GOODWILL OR LOSS OF PROFITS ARISING IN
ANY MANNER FROM THIS AGREEMENT WHETHER BASED ON ANY THEORY OF TORT, BREACH OF
CONTRACT OR STATUTE OR WHETHER AT LAW OR IN EQUITY.
13. GENERAL PROVISIONS
a. Assignment; Subcontracting: Sales Agency may not assign this
Agreement, in whole or in part, without the prior written
consent of LDDS which may be given or withheld at the sole
discretion of LDDS. Any attempt to assign any of the rights,
duties or obligations of this Agreement without such consent
shall be void and shall entitle LDDS to terminate this
Agreement in accordance with Subsection 3(b) above
b. Amendment: Except as otherwise provided herein, this Agreement
can be modified only by a written amendment duly signed by
persons authorized to sign agreements on behalf of Sales Agency
and LDDS and shall not be modified or supplemented by any
course of dealing or trade usage.
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c. Waiver: No course of dealing or failure of either party to
strictly enforce any term, right or condition of this
Agreement shall be construed as a waiver of such term, right
or condition.
d. Surviving Obligations: All obligations and duties which by
their nature extend beyond the expiration or termination of
this Agreement shall survive and remain in effect beyond any
expiration or termination.
e. Choice of Law; Forum: This Agreement is governed by the law of
the State of Oklahoma without regard to choice of law
principles. Any legal action or proceeding with respect to
this Agreement may be brought in the Courts of the State of
Oklahoma in and for the County of Tulsa or the United States
of America for the Northern District of Oklahoma. By
execution of this Agreement, both Customer and LDDS hereby
submit to such jurisdiction, hereby expressly waiving whatever
rights may correspond to either of them by reason of their
present or future domicile. In furtherance of the foregoing,
Customer and LDDS hereby agree to service by U.S. Mail at the
notice addresses referenced in Subsection (k) below. Such
service shall be deemed effective upon the earlier of actual
receipt or seven (7) days from the date of posting.
f. Force Majeure: Neither party shall be held liable for any
delay or failure in performance of any part of this Agreement
because of cause or circumstances beyond its control such as
acts of God, acts of civil or military authorities,
legislative, executive or judicial acts of any governmental
entity, cable cuts, government regulations, embargoes,
epidemics, war, terrorist acts, riots, insurrections, fires,
explosions, earthquakes, nuclear accidents, floods, or other
major environmental disturbances, power blackouts, strikes, or
from any other cause of whatsoever kind arising without its
actual fault (collectively referred to as "FORCE MAJEURE
CONDITIONS"). In the event of a Force Majeure Condition
affecting either party, both parties shall cooperate as
appropriate to perform their obligations under this Agreement.
g. Successors Bound: This Agreement shall be binding upon and
inure to the benefit of any permitted successors or assigns of
the parties.
h. Acrency Orders: All obligations under this Agreement shall be
subject to legislation and to valid and applicable government
agency orders, regulations, tariff provisions, and decisions
and orders of courts of competent jurisdiction.
i. Severability: Both parties expressly agree that it is not the
intention of either party to violate public policy or state or
federal statutory or common laws and that if
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any sentence, paragraph, clause or combination thereof in this
Agreement is in violation of the same, such paragraph, clause,
or sentence, or combination of the same shall be inoperative
and the remainder of this Agreement shall remain binding upon
the parties hereto.
j. Headings: The headings in this Agreement are for convenience
only and shall not be construed to define or in any way limit
any terms herein.
k. Notice: All notices, requests, or other communications other
than Service Contracts or related order forms/correspondence
placed with the LDDS Sales Support Group, made under this
Agreement shall be made in writing and shall be deemed
delivered (i) upon actual receipt if hand delivered, (ii)
three (3) business days after posting with the United States
Mail, postage prepaid, certified or registered, (iii) one (1)
business day after pick up by an overnight mail service, or
(iv) one (1) business day after the date of sender's
electronic confirmation of receipt if sent by facsimile
transmission. Notices may be sent to the following addresses
or Fax numbers, which addresses or Fax numbers may be changed
by written notice to the other party.
To Sales Agency: To LDDS:
Consortium 2000 WorldCom, Inc.
0000 Xxxxxxx Xxxxxxx Xxx Xxxxxxxxxxx Xxxxx
Xxxxx 000 Xxxx Xxxxxxxxxx, XX 00000
Xxxxxx Xxxx, XX 00000
Attn: Attn:
------------------- -----------------
l. Improper Payments - Practices: Sales Agency will not use any
funds received under this Agreement for illegal or otherwise
improper purposes related to this Agreement. Sales Agency
will not pay any commissions, fees or rebates to any employee
of LDDS nor favor any employee of LDDS with gifts or
entertainment of significant value. Sales Agency further
represents and undertakes: (i) that in the course of
performing the services contemplated by this Agreement, no
expenditures for other than lawful purposes will be made by
Sales Agency (including the principals or employees thereof or
parties under the control of Sales Agency); (ii) that no
payments will be made by Sales Agency in the performance of
its services under this Agreement to government officials or
the employees or officials of prospective users of
international telecommunications services in contravention of
the prescriptions of the Foreign Corrupt Practices Act of the
United States of America (Pub.L. 100-418, as amended or
hereafter amended), and that no government official has any
direct or indirect ownership or investment interest in Sales
Agency or interest in the revenues or profits of
CONFIDENTIAL
Page 14 of 15
15
Sales Agency; and (iii) that, on request of LDDS, Sales Agency
shall furnish a certificate attested to by the chief operating
officer or principal of Sales Agency to the effect that Sales
Agency, its officers, directors, principals, employees and
authorized agents thereof performing services under this
Agreement are in compliance with the foregoing representations
and undertakings. If LDDS has reasonable cause to believe
that the provisions of the preceding sentences have been
violated, LDDS, or its representative, may audit the records
of Sales Agency, for the sole purpose of establishing
compliance with such requirements.
m. Entire Agreement: This Agreement consists of all the terms and
conditions contained herein, in the Appendices attached
hereto, and in documents incorporated herein specifically by
reference. This Agreement constitutes the complete and
exclusive statement of the understandings between the parties
and supersedes all proposals and prior agreements (oral or
written) between the parties relating to the subject matter
hereof. No subsequent agreement between the parties
concerning this Agreement or the subject matter hereof shall
be effective or binding unless it is made in writing and
subscribed to by authorized representatives of Sales Agency
and LDDS.
Both parties represent they have read this Agreement, understand it
and agree to be bound by all the terms and conditions stated herein.
WORLDCOM, INC. CONSORTIUM 2000
d/b/a LDDS Worldcom
/s/ XXXXXX X. XXXXXXX [SIG]
----------------------------- -----------------------------------
(Signature) (Signature)
Xxxxxx X. Xxxxxxx [SIG]
----------------------------- -----------------------------------
(Print Name) (Print Name)
Vice President Executive Vice President
----------------------------- -----------------------------------
(Title) (Title)
CONFIDENTIAL
Page 15 of 15
16
APPENDIX A
This Appendix A is made as of the 1st day of June, 1995, to that
certain Sales Agency Agreement for the Sale of Telecommunications Services,
made by and between WorldCom, Inc. d/b/a LDDS WorldCom ("LDDS") and Consortium
2000 ("SALES AGENCY") dated as of June 1, 1995.
I. SERVICES, RATES AND DISCOUNTS TO BE OFFERED BY SALES AGENCY
a. MTS.
b. CALLING CARD.
c. PERFORMANCE 2000.
d. PRECISION PLUS.
e. HOME PLUS.
f. EXACT CALL.
g. EASY ANSWER.
h. PERFORMANCE 4000.
i. WORLD ONE.
j. XXXXXX (PRIVATE LINE INTEREXCHANGE SERVICE)
Note: The Services listed in (a) through (i) above (including the
applicable rates and discounts) are further described in LDDS' F.C.C. Tariff
No. 2 as may be amended from time to time, and the Service listed in (j) above
(including the applicable rates and discounts) are further described in
WorldCom Network Services, Inc. d/b/a WilTel (an LDDS affiliate) F.C.C. Tariff
No. 4 as may be amended from time to time.
II. AUTHORIZED TERRITORY
Continental United States of America.
III. COMMISSION PLAN
a. During the Initial Term and any automatic extension thereof,
Sales Agency will receive the following Commissions on each Customer's account
that has a gross monthly usage of at least $10.00.
i. * for each International Service sold by Sales Agency,
based on the net billed monthly usage of each Customer's
International measured usage charges (i.e., after discounts).
Page 1 of 2 CONFIDENTIAL
17
ii. The following Commission for each domestic Service
sold by Sales Agency (which shall include Alaska, Hawaii,
Puerto Rico, the United States Virgin Islands and Washington,
D.C.), based on (i) the net billed monthly usage charges of
each Customer's domestic measured usage charges (i.e., after
discounts), and (ii) the net billed monthly recurring
interexchange Service charges of each Customer's domestic
monthly recurring charges. Commissions shall not be paid on
installation, local access, special construction charges,
taxes or any other charges by a third party).
Aggregate
Monthly Volume* Commission
$1,000 - $100,000 *
$100,001 - $200,000 *
$200,000 - $300,000 *
$300,001 - $400,000 *
$400,001 - $500,000 *
$500,000+ *
* For purposes of this Agreement, "Aggregate Monthly
Volume" shall mean (i) the aggregate net (i.e., after
discounts, if any) measured usage charges of all Services
(including without limitation, International Services) sold by
Sales Agency, and (ii) the aggregate net monthly recurring
interexchange Service charges sold by Sales Agency. Aggregate
Monthly Volume shall exclude installation, local access,
special construction charges, taxes or any other charges by a
third party).
b. If, at any time, Sales Agency's Aggregate Monthly Volume is less than
* LDDS may at its option cancel this Agreement upon thirty (30) days written
notice at which time LDDS will not be responsible for paying any further
Commissions.
c. No Commissions shall be paid on installation, operator services, local
access, special construction charges, ancillary services, special features
(e.g., enhanced 800 time of day routing), taxes or any other charges or
surcharges by a third party.
d. Commissions shall not be paid in any month in which Sales Agency's
Commissions are less than $100. If Sales Agency's Commissions are less than
LDDS may withhold payment until such amount is at least *
Page 2 of 2 CONFIDENTIAL
00
XXXXXXXX X
This Appendix B is made as of the 1st day of June, 1995, to that
certain Sales Agency Agreement for the Sale of Telecommunications Services,
made by and between WorldCom, Inc. d/b/a LDDS WorldCom ("LDDS") and Consortium
2000 ("SALES AGENCY") dated as of June 1, 1995.
INSURANCE REQUIREMENTS
1. Sales Agency shall obtain, pay for and maintain insurance for
the coverages and amounts of coverage not less than those set forth
below and shall provide to LDDS certificates issued by insurance
companies satisfactory to LDDS to evidence such coverages. Such
certificates shall provide that there shall be no termination,
non-renewal, or modification of such coverage without thirty (30)
days' prior written notice to LDDS. In the event of any failure by
Sales Agency to comply with the provisions of this paragraph, LDDS
may, at its option, on notice to Sales Agency, suspend this Agreement
until there is full compliance with this paragraph, or terminate the
Agreement.
a. Workers' Compensation complying with the law of the
State or States of operation, whether or not such coverage is
required by law, and Employer's Liability insurance with
limits of $500,000 each accident, including occupational
disease coverage with a limit of $500,000 each employee and
$500,000 disease policy limit. If work is to be performed in
Nevada, North Dakota, Ohio, Wyoming, Washington or West
Virginia, Sales Agency will purchase Workers' Compensation in
the State Fund established in the respective States. Stop Gap
Coverage or Employers Overhead coverage shall be purchased.
b. Commercial General Liability insurance with a
combined single limit for bodily injury and property damage of
$1,000,000 each occurrence and general and products liability
aggregates of $2,000,000 each, covering all insurable
obligations or operations of Sales Agency. Policy shall
include no modifications that reduce the standard coverages
provided under a Commercial General Liability insurance policy
form.
c. Business Automobile Liability insurance with a
combined single limit for bodily injury and property damage of
$1,000,000 each occurrence to include coverage for all owned,
non-owned and hired vehicles.
2. Notwithstanding the requirements contained in Section 1 above,
Sales Agency will not be required to pay for and maintain insurance
for the coverages and amounts of coverage set forth in Section 1 above
if Sales Agency is exempt by applicable state law or statute from
compulsory coverage of such insurance. If Sales Agency is not exempt
by applicable
Page 1 of 2 CONFIDENTIAL
19
state law or statute from compulsory coverage of such insurance, LDDS
agrees to waive such requirements; provided, however, in such case,
Sales Agency agrees to indemnify and hold LDDS harmless from any and
all claims, actions, damages, expenses and other liabilities,
including reasonable attorney's fees and costs of litigation,
resulting from any workers' compensation claim or claim for bodily
injury and/or property damage asserted by sales Agency or any third
party in conjunction with or arising from the subject matter of this
Agreement.
3. In the event coverage is denied or reimbursement of a properly
presented claim is disputed by the carrier for insurance provided in 1
through 3 above, Contractor shall, upon written request, provide LDDS
with a certified copy of the involved insurance policy or policies
within ten (10) business days of receipt of such request.
4. Sales Agency waives its right, and its underwriters right, of
subrogation against LDDS, its Officers, Directors, Agents, and
Employees thereof, and corporate shareholder and its Officers,
Directors, Agents and Employees thereof, providing that such waiver in
writing, prior to loss does not void or alter coverage.
5. Neither the insurance required herein or the amount or type of
insurance maintained by Sales Agency shall limit or affect the extent
of Sales Agency's liability hereunder for injury, death, loss or
damage.
6. LDDS and its Affiliates, shall not insure or be responsible
for any loss or damage to property of any kind owned or leased by
Sales Agency or its employees, servants and agents. Any policy of
insurance covering the Property owned or leased by Sales Agency
against loss by physical damage shall provide that the underwriters
have given their permission to waive their rights of subrogation
against LDDS, its affiliates and their directors, officers and
employees, directors, officers and employees thereof.
Page 2 of 2 CONFIDENTIAL
20
SCHEDULE 1
EXISTING CUSTOMERS
1. All ANIs (Residential) under Account Nos. 854-185281 and
854-187924 with WorldCom Network Services, Inc. (an affiliate
of LDDS).
2. See the attached listing of Commercial Accounts.
21
VENDOR # AGGOO8(CTM)
CONSORTIUM 2000
0000 XXXXXXX XXXXXXX, XXXXX 000
XXXXXX XXXX, XX 00000
000-000-0000
ONE PLUS COMMISSIONS
APRIL 1995
[ * All prices on this table have been omitted for purposes of confidentiality
and are filed separately with the Securities and Exchange Commission.]
===================================================================================================================================
-- AGING OF INVOICES AS OF 5/16/95 --
1-30 31-60 61-90 Over 90
Days Days Days Days
Past Past Past Past
CUST # CUSTOMER NAME INVOICE Invoice Invoice Invoice Invoice DATE SHORT COMM COMM
DATE Date Date Date Date CLEARED PAY RATE AMT
===================================================================================================================================
