EX-10.41
Services Agreement
SERVICES AGREEMENT
THIS SERVICES AGREEMENT (this "Agreement"), entered into as of the 29th day of
October, 1996, by and between PACIFIC & EASTERN DIGITAL TRANSMISSION SERVICES,
INC., a Colorado corporation ("PEDTS"), with principal offices at 0000 Xxxx
Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, ICG TELECOM GROUP, INC., a Colorado
corporation, with principal offices at 0000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx, 00000 and ADVANCED RADIO TECHNOLOGIES CORPORATION, a Delaware
corporation ("ART"), with principal offices at Suite 2600, 000 000xx Xxxxxx
X.X., Xxxxxxxx, Xxxxxxxxxx 00000.
WHEREAS, PEDTS has been granted authorizations for certain 38GHZ microwave
systems ("Authorizations") by the Federal Communications Commission ("FCC");
WHEREAS, PEDTS has an existing relationship with ICG Holdings, Inc. the parent
company of ICG Telecom Group, Inc. in the form of an option (the "Option")
allowing the transfer of the authorizations to ICG Telecom Group, Inc.
(collectively ICG Holdings, Inc. and its parent, Affiliates and subsidiaries,
"ICG");
WHEREAS, ART desires to obtain access to and use of the Authorizations for its
38GHZ business; and
WHEREAS, PEDTS and/or ICG desire to grant ART, in accordance with the FCC's
rules and policies, use of the Authorizations immediately and a right of first
refusal to purchase the Authorizations.
NOW THEREFORE, the parties, intending to be legally bound, in consideration of
the promises and respective covenants, representations and warranties contained
herein, hereby agree as follows:
ARTICLE I
DEFINITIONS
"Affiliate" shall mean as to any Person (as hereinafter defined) any other
Person whom the first Person controls, is controlled by or is under direct
common control with the other Person.
"Audit Rights" shall mean the reasonable right of Licensee (as hereinafter
defined) to audit the books and records of ART, including all databases relating
to the use of the Authorizations, for a specific purpose. The audit must be
conducted during Business Hours and subject to the confidentiality provisions
provided herein. ART shall be given at least two weeks notice of the audit. The
Licensee shall bear the entire cost of the audit, including, without limitation,
the cost of outside auditors, duplication of books and records and overtime by
ART employees, if any. Licensee covenants and agrees that it will not disclose
any information obtained by it in connection with such audits or reports and
will not use such information for any other purpose.
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"Authorizations" shall mean the authorizations for 38GHZ Systems granted to
PEDTS or ICG by the FCC, listed in Exhibit 1 to this Agreement.
"Business Days" shall mean the days of the week from Monday through Friday,
excluding federal holidays and holidays for ART and/or ICG employees.
"Business Hours" shall mean the hours between 9 AM and 5 PM, Pacific Time,
during Business Days.
"Circuit" shall mean a transmission path between two Customer connection points
consisting of any individual DS-1s or DS-3s provided in total or in part by ART.
"Construction Requirements" shall mean those build-out requirements imposed from
time to time by the FCC to avoid a forfeiture of the license.
"Customer" shall mean the Person who receives Services from ART and is
responsible for payment to ART for Services.
"Datarate" shall mean the transmission rate of a Circuit, phrased in mbps or the
surrogate for certain datarates, such as DS-1s or DS-3s.
"DS-1" shall mean a Circuit having a Datarate of 1.544 mbps.
"DS-3" shall mean a Circuit having a Datarate of 45 mbps.
"Equipment" shall mean the ODU, antenna, mounting apparatus, the IDU, connecting
cables and all ancillary equipment such as modems and multiplexing equipment
that is part of the Service and is on ART's side of the interface with the
Customer.
"Final Order" shall mean an order of a government agency or court that is no
longer subject to reconsideration or to review or appeal by a higher authority.
"IDU" shall mean the indoor unit, usually located on the Customer's premises and
consisting of the electronics that are not housed within the ODU, capable of
receiving from or transmitting to the ODU over connecting cable.
"Licensed Operation" shall mean that ART has installed and placed into Operation
sufficient facilities in an authorized service area to satisfy the then-existing
construction requirements.
"Licensee" shall mean PEDTS and/or ICG Communications, Inc., depending upon
which entity holds the licenses at any given time.
"Licenses" shall mean those Authorizations granted to PEDTS and/or ICG in the
38 GHz band that are listed in Exhibit 1.
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"Notice" shall mean notice as set forth in Section 14.11 hereof.
"ODU" shall mean the outdoor unit, usually located on a roof or tower, but
sometimes on the inside of a window, and consisting typically of an antenna,
mounting devices, such as a pole or tripod, and associated electronics, capable
of receiving from or transmitting to the IDU over connecting cable.
"Operation" shall mean, in the case of a Circuit, that the Circuit is
transporting data from one point of connection to a Customer to another point of
connection to a Customer.
"Parties" shall mean ART and ICG in the event that ICG has closed on the
Options; otherwise, the term shall include ART, ICG and PEDTS.
"Person" shall mean an individual or business entity, including without
limitation a corporation, partnership, limited liability company, association or
joint venture.
"Service" shall mean each of the services permitted by FCC rules and policies to
be provided from time to time using the Authorizations identified in Exhibit 1.
"Service Area" shall mean the geographic area covered by the Authorizations that
are listed in Exhibit 1.
"Site" shall mean the location of the radio transceiver, antenna and associated
equipment that is one end of a Circuit.
"Term" shall have the meaning ascribed to it in Article IX.
"Use" shall mean the right to fully exploit the Authorizations in accordance
with the rules and policies of the FCC and the terms and conditions stated
therein, including without limitation the right to provide Services throughout
the Service Areas to Affiliates or third parties to the maximum extent permitted
by the FCC and to engage in all activities ancillary, complementary or
supportive of the authorized Services, including without limitation sales and
marketing.
"38 GHZ" shall mean the millimetric wave frequencies between 37.0 GHZ and 40.0
GHZ allocated to point-to-point and other services by the FCC.
ARTICLE II
LIMITED EXCLUSIVE RIGHT OF USE
2.1 PEDTS or, in the event that ICG has exercised the Option and closed on the
purchase of the Authorizations, ICG (collectively, "Licensee") hereby grants ART
the exclusive right as against Third parties to Use the Authorizations for
broadband millimetric wave services during the Term of this Agreement; provided
that Licensee shall at all times retain its right to use the Authorizations.
2.2 ART's right of Use shall at all times be subordinate to the control of
Licensee to the maximum extent required by the FCC. The Licensee shall have the
right to order ART to cease
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transmission over any Circuit if: (i) there has been a material breach of this
Agreement by ART, ART has received Notice of the breach from Licensee and ART
has failed to cure the breach within the time frames set forth for cure in
Section l0.1 hereof ("Cure Time"); (ii) a Final Order has been issued by the FCC
or another governmental agency or court with jurisdiction that requires ART to
cease transmission; (iii) if PEDTS or ICG receives a Final Order, for any
reasons whatsoever, to cease operation of a Circuit or Circuits sold by ART or
its agents; or (iv) as deemed reasonably necessary by Licensee to retain control
over the Authorizations as required by FCC rules and policies. ART shall be
required to cease transmission on the date that the Cure Time elapses, that the
Final Order becomes effective, or immediately under subsection (iv) of this
Section 2.2.
2.3 ART shall maintain a database of all Circuits operated by it ("Use
Database"). The Use Database shall contain: (i) the name, address and contact
numbers (voice, facsimile and e-mail) of the Customer; (ii) latitude and
longitude and location address of each Site, including such information for the
IDU and the ODU if they are not co-located; (iii) the Datarate of the Circuit;
(iv) the date that the Circuit became Operational; (v) the date that the Circuit
was taken out of operation, if applicable; and (vi) technical information
concerning the transmission facilities sufficient to enable Licensee to file
such reports that are required to be filed by the FCC and by any other
governmental agency, including without limitation the brand, model number and
ART identification number of the radio transceiver at each Site. Licensee shall
have the right to obtain additional information from ART concerning the
operation of the Circuits to the extent that such additional information is
readily available and the request is otherwise reasonable including without
limitation considerations of scope, expense and time for responding. Licensee
shall have an absolute right to obtain any additional information from ART
necessary to comply with the FCC's rules and policies, or a direct request for
information from the FCC. Licensee shall have: (i) access to and a right of
inspection and duplication, at its cost, of the Use Database during Business
Hours, upon five (5) Business Days advance Notice and (ii) Audit Rights.
Licensee will not disclose to any of Licensee's sales personnel any Customer
information obtained from ART in reports or audits to Licensee.
2.4 ART shall deliver to Licensee in a mutually-agreeable format within thirty
(30) days of the end of each month a certified report listing: (i) the Circuits
installed in that month; (ii) the Circuits that were operational in all or part
of the month; (iii) the amount of payment due to Licensee for each such Circuit
for that month ("Monthly Use Report").
2.5 Except for the Equipment used to provide the Limited Construction Services
set forth in Article III below, ART shall provide, but own and retain title to,
the Equipment used to provide Services. In the event the FCC requires Licensee
to own or control the Equipment, the parties shall negotiate in good faith a
lease or other arrangement which satisfies such FCC requirement and recognizes
ART's investment in such Equipment. The lease or other arrangement shall
terminate immediately upon the termination of this Agreement, and Licensee shall
cooperate in good faith so that ART may take possession of the Equipment
immediately. Licensee shall return such Equipment to ART in good condition,
except for normal wear and tear.
2.6 For any ART owned Equipment, Licensee shall keep and maintain such Equipment
free and clear of all liens, charges, security interests and encumbrances
(except any placed thereon by or with the written consent of ART). Licensee
shall take all appropriate measures to secure the
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Equipment on premises it owns or controls from loss, destruction or damage,
including but not limited to: physical security, including without limit
barriers, limited and locked access, posted warnings and training of those with
access; electronic security including without limit periodic audits of its
telecommunications systems and passwords; environmental controls; and suitable
power supplies.
2.7 Each Party (the "Sending Party") will notify the other in writing at least
four (4) business days in advance of any pending Circuit activation to ensure
interference free communications between the customers of the Parties. When ART
is the Sending Party, the notification will include location of the Circuit
link, frequency channel plan, the type of radio equipment to be installed, that
no frequency interference exists as determined in good faith by ART. If Licensee
is the Sending Party, the notification will include location of the Circuit
link, frequency channel plan, the type of radio equipment to be installed and
such other information or forms as the Parties may mutually agree upon. The
other Party will supply the Sending Party with written notification of
acceptance within three (3) business days of receiving the notice. If the other
Party does not provide written notification of acceptance within three (3)
business days, the Sending Party will deem its notice as accepted.
2.8 The Parties agree that they will take all appropriate steps to ensure that
each Party and their customers are protected from unacceptable interference in
accordance with the FCC's interference standards and that the first Party to
install a Circuit along a path shall be protected against interference from all
subsequent Circuits. The Parties also agree that they will take all appropriate
steps to ensure that third party users of radio spectrum are protected from
unacceptable interference in accordance with the FCC's interference standards.
In the event any third party notifies Licensee or ART of interference caused by
operation of a Circuit, the Party (Licensee or ART) responsible for ordering and
installing the interfering Circuit, shall take all appropriate measures to
resolve such claim of interference, including, but not limited to, defending
such claim before the FCC.
ARTICLE III
LIMITED CONSTRUCTION SERVICES
3.1 ART shall exercise best efforts, subject to Licensee's oversight and
control, to place Circuits and/or 38 GHZ facilities ("Facilities") into Licensed
Operation in each of the Service Areas in a timely manner in accordance with (i)
the FCC's construction requirements at the time of such installation and (ii)
criteria to be mutually-agreed upon from time to time by the parties based upon
good faith negotiations. ART acknowledges that the intent of this Section 3.1 is
to ensure that there is substantially no risk that any of Licensee's
Authorizations will be forfeited due to failure to satisfy the FCC's
Construction requirements.
3.2 In the event that the FCC Construction requirements change to require
additional Facilities be constructed after the initial Facilities are installed
in accordance with Section 3.1, ART, at its sole option, may elect to satisfy
such new Construction requirements. ART shall give Licensee Notice of its
decision of whether it will satisfy the new Construction requirements. In the
event ART elects not to satisfy the new Construction requirements, and so
Notifies Licensee, Licensee may, at its option, terminate this Agreement. In the
event (i) of such termination and (ii) Licensee, its agents,
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representatives or contractors satisfy the new Construction requirements, ART
shall have the rights with respect to Customers as set forth in Section 10.5.
3.3 Licensee shall own the Equipment used to provide the Limited Construction
Services pursuant to this Article III. ART shall procure and purchase the
Equipment in order to take advantage of ART's volume discounts with its
preferred vendors. ART shall sell the Equipment used to provide the Limited
Construction Services to Licensee at its direct costs, amortized equally over
the Initial Term of the Agreement, simultaneously with the Equipment being
placed into Licensed Operation. Simultaneously with the sale of the Equipment
from ART to Licensee, Licensee shall enter into an Equipment lease agreement
("Lease") with ART. The terms of the Lease shall be satisfactory to Licensee.
The Lease shall, among other usual and customary terms permit ART to provide
services to its customers using seventy-five percent (75%) of the full capacity
of the Equipment, subject to any prior arrangement by Licensee to use all or
part of the capacity for its Service. Licensee shall retain the use of
twenty-five percent (25%) of the capacity for servicing Licensee's customers.
The monthly Lease payments from ART shall equal the monthly installment sale
payments set forth above from Licensee, except to the extent that Licensee uses
a part of the Equipment for Service, in which case the Lease payments shall be
reduced proportionately. In addition to Licensee controlling the portion of the
facilities used by ART pursuant to this Service Agreement to provide service to
ART's customers, the parties also shall enter into a Management Agreement, which
shall be consistent with FCC requirements and which shall provide for ART to
manage the Equipment and the services that it provides to Licensee's customers
pursuant to the Limited Construction Services of this Article III, under the
supervision and direction of Licensee. The terms of the Management Agreement
shall be mutually satisfactory. It is the parties' intention to execute the
Lease and the Management Agreement within ten (10) days of the date hereof.
Execution of the Lease and Management Agreement is a condition precedent to the
effectiveness of this Agreement.
3.4 Each Party (the "Sending Party") will notify the other in writing at least
four (4) business days in advance of any pending Circuit activation to ensure
interference free communications between the customers of the Parties. When ART
is the Sending Party, the notification will include location of the Circuit
link, frequency channel plan, the type of radio equipment to be installed, that
no frequency interference exists as determined in good faith by ART. If Licensee
is the Sending Party, the notification will include location of the Circuit
link, frequency channel plan, the type of radio equipment to be installed and
such other information or forms as the Parties may mutually agree upon. The
other Party will supply the Sending Party with written notification of
acceptance within three (3) business days of receiving the notice. If the other
Party does not provide written notification of acceptance within three (3)
business days, the Sending Party will deem its notice as accepted.
3.5 Licensee and ART shall ensure that the Equipment remains personal property
and that it does not become in any manner embedded in, affixed or attached to
real property or any building thereon. Licensee shall keep and maintain the
Equipment free and clear of all liens, charges, security interests and
encumbrances (except any placed thereon by or with the consent of ART) Licensee
shall take all appropriate measures to secure the Equipment on premises it owns
or controls from loss, destruction or damage, including but not limited to:
physical security, including without limitation barriers,
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limited and locked access, posted warnings and training of those with access,
electronic security including without limit periodic audits of its
telecommunications systems and passwords; environmental controls; and suitable
power supplies.
ARTICLE IV
PAYMENT
4.1 ART shall pay to Licensee as full consideration for each Circuit that it
places into Operation pursuant to Article II a monthly fee of: (i) $25 for
transmitting the equivalent of a DS-1 on a Circuit, provided that in no event
shall such fee exceed $200; and (ii) $200 for each Circuit using a DS-3 radio.
The fees under subsection (i) of this Section 4.1 are not dependent upon the
capacity of the Equipment (for example, if only the equivalent of two DS-1's are
transmitted using a 4DS-l radio, the monthly fee would be $50). Repeaters used
to extend a Circuit beyond the normal transmission range and traversing more
than one link will be treated as a single Circuit.
4.2 Payment shall be due within thirty (30) days after the end of each month
("Payment Due Date").
ARTICLE V
RIGHT OF FIRST REFUSAL
5.1 Subject to FCC approval, in the event that Licensee, at any time during the
term of this Agreement, shall receive from any third party (i) a bona fide offer
to purchase the Authorizations at a price and upon terms acceptable to Licensee,
or (ii) an acceptance of any offer made by Licensee to sell the Authorizations
(which offer must be subject to the rights of ART contained in this Article V)
Licensee shall give written notice thereof to ART. Such notice shall set forth
the material terms upon which the sale or purchase is to be made and the
consideration to be paid by the proposed buyer. ART shall have the right and
option (but not any obligation) to purchase the Authorizations, at its election,
upon the equivalent price and material terms and conditions as set forth in the
offer, by giving Licensee written notice of its election to purchase within
thirty (30) days following receipt of such notice. If ART elects to acquire the
Authorizations, Licensee shall sell, and ART shall buy, subject to FCC approval,
the Authorizations for an equivalent price and material terms and conditions
contained in the notice, except that the consummation time period set forth
below in this Section 5.1 shall apply. ART shall have one hundred eighty (180)
days from receipt by Licensee of ART's notice of its election to purchase the
Authorizations to consummate the purchase transaction, unless a longer period is
provided in the terms and conditions of the offer received by Licensee or due to
FCC regulations, policy or approval. The parties shall execute such documents as
may be reasonably necessary to effectuate the sale or transfer. In the event
that ART gives Licensee written notice of its election to purchase and the
purchase transaction is not consummated within the applicable 180 day, or
longer, period provided for in this Section 5.1, then ART shall pay to ICG
within ten (10) business days of the expiration of the applicable consummation
period the sum of One Hundred Thousand Dollars ($100,000).
5.2 If ART elects not to exercise its rights under this Article V, either in
writing or by its failure to make the election within the thirty (30) day
period. Licensee shall have the right to sell or
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otherwise transfer the Authorizations to the proposed buyer that made the bona
fide offer to Licensee for the consideration and material terms and conditions
as disclosed to ART. If any of the material terms or conditions of the offer are
changed prior to the sale or transfer to the proposed buyer, Licensee shall
repeat this right of first refusal procedure, setting forth all the modified
terms.
5.3 The transfer of Authorizations between the Affiliates or subsidiaries of
PEDTS, between the Affiliates or subsidiaries of ICG or between PEDTS or its
Affiliates and subsidiaries and ICG or its Affiliates or subsidiaries shall not
trigger ART's rights of first refusal under this Article V.
ARTICLE VI
ART's REPRESENTATIONS AND WARRANTIES
In addition to any express agreements of ART contained herein, the following
constitute representations and warranties of ART to Licensee:
6.1 ART has all requisite corporate power and authority, and as of the date
hereof will have taken all requisite corporate action, to execute, deliver and
perform this Agreement.
6.2 All requisite action (corporate, trust, partnership or otherwise) has been
taken by ART in connection with the entering into this Agreement, the
instruments referenced herein, and the consummation of the transactions
contemplated hereby. No consent of any partner, shareholder, creditor, investor,
judicial or administrative body, governmental authority or other party is,
required.
6.3 ART has sufficient staff and sufficient industry experience to perform its
obligations hereunder, including without limitation prior frequency coordination
and radio frequency engineering to ensure operations that are free of
unacceptable interference, in accordance with FCC rules and industry standards,
on a timely basis.
6.4 Neither the execution and delivery of this Agreement, nor the incurrence of
the obligations set forth herein, nor the consummation of the transactions
herein contemplated, nor compliance with the terms of this Agreement conflict
with or result in the material breach of any terms, conditions or provisions of,
or constitute a default under, any agreements or instruments to which ART is a
party.
6.5 No representation, warranty or statement of ART in this Agreement or in any
document, certificate or exhibit furnished to Licensee pursuant hereto contains
any untrue statement of a material fact or omits to state a material fact
necessary to make the statements or facts contained therein not misleading.
6.6 ART shall promptly notify Licensee of any changes in any condition or status
with respect to the Authorizations or of any event or circumstance which makes
any representations or warranty of Licensee under this Agreement untrue or
misleading, or any covenant of Licensee under this Agreement incapable or less
likely of being performed, it being understood that ART's obligation to provide
notice to Licensee shall in no way relieve ART of any liability for a breach by
ART of any of its representations, warranties or covenants under this Agreement.
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ARTICLE VII
LICENSEE's REPRESENTATIONS AND WARRANTIES
In addition to any express agreements of Licensee contained herein, the
following constitute representations and warranties of Licensee to ART:
7.1 Licensee has all requisite corporate power and authority, and as of the date
hereof has taken all requisite corporate action, to execute, deliver and perform
this Agreement.
7.2 All requisite action (corporate, trust, partnership or otherwise) has been
taken by Licensee in connection with the entering into this Agreement, the
instruments referenced herein, and the consummation of the transactions
contemplated hereby. No consent of any partner, shareholder, creditor, investor,
judicial or administrative body, governmental authority or other party is,
required.
7.3 Exhibit is true and correct to the best knowledge of Licensee. Licensee has
full right and authority to be the licensee and is fully qualified under FCC
rules and policies to be a licensee. ART expressly acknowledges that four (4) of
these Authorizations (covering Santa Monica, Ventura, Palm Springs, and San
Diego) have discrepancies between the applied for, coordinated and licensed
service areas. These discrepancies currently are being evaluated by a
subcontracted engineering firm with the intent to correct them at the FCC. ART
understands that Licensee has no control over the subsequent action of the FCC
regarding these particular Authorizations.
7.4 With the exception of the four Authorizations specifically identified in
Section 7.3, the Authorizations (i) were duly issued by the FCC to Licensee, or
if to a predecessor of Licensee authority for transfer to Licensee has been duly
given, (ii) are in full force and effect, and (iii) contain all of the
conditions placed upon them, except as found in the FCC rules.
7.5 Licensee has secured all governmental approvals, including without
limitation approvals from the FCC, necessary for Licensee to be the holder of
the Authorizations. Licensee is fully qualified to be a licensee of the FCC.
Licensee has filed, on a timely basis, all reports required by the FCC and other
governmental agencies. There are no pending or threatened actions, orders or
claims that would invalidate, void, cancel or rescind the Authorizations or that
would materially interfere with or restrict ART's Use of the Authorizations.
7.6 Licensee has no knowledge of any reason or of any action or inaction or any
threat of action that would interfere with ART's exercise of each of its rights
under this Agreement to Use of the Authorizations.
7.7 There are no pending and, to the best of Licensee's knowledge, threatened or
contemplated actions, suits, arbitrations, claims or proceedings, at law or in
equity, affecting the Authorizations or in which Licensee is, or to the best of
Licensee's knowledge will he, a party by reason of Licensee's holding the
Authorizations.
7.8 Licensee has not granted any other rights or entered into any other
agreements that would interfere with or restrict ART's use of the
Authorizations, including, without limitation, any other
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contracts for the right to use or sale of the Authorizations, rights of first
refusal or options to purchase the Authorizations.
7.9 Neither the execution and delivery of this Agreement, nor the incurrence of
the obligations set forth herein, nor the consummation of the transactions
herein contemplated, nor compliance with the terms of this Agreement conflict
with or result in the material breach of any terms, conditions or provisions of,
or constitute a default under, any agreements or instruments to which Licensee
is a party.
7.10 To the best of Licensee's knowledge, there are no violations of
governmental regulations relating to the Authorizations. To the best of
Licensee's knowledge, ART's use of the Authorizations, subject to Licensee's
full oversight and control as required by the FCC rules and policies, will not
violate any Governmental Regulations.
7.11 Licensee shall promptly notify ART of any changes in any condition or
status with respect to the Authorizations or of any event or circumstance which
makes any representations or warranty of Licensee under this Agreement untrue or
misleading, or any covenant or ART under this Agreement incapable or less likely
of being performed, it being understood that Licensee's obligation to provide
notice to ART shall in no way relieve Licensee of any liability for a breach by
Licensee of any of its representations, warranties or covenants under this
Agreement.
7.12 No representation, warranty or statement of Licensee in this Agreement or
in any document, certificate or exhibit furnished to ART pursuant hereto
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements or facts contained therein not misleading.
ARTICLE VIII
GOVERNMENTAL FILINGS
8.1 Licensee shall bear ultimate responsibility for, and shall bear all costs
for, all filings with: (i) the FCC, including without limitation Form 494As;
(ii) state utility commissions; and (iii) any other governmental body that
requires Licensee to be the filer (collectively "Official Filings"). ART shall
fully cooperate with Licensee's Official Filings by supplying all information
that is in the possession of ART or that can be readily obtained by ART and that
is not in the possession of Licensee.
8.2 ART shall be responsible for, arid shall bear all costs for all firings that
are caused by the provision of Services to itself or its Customers through ART's
right to Use under Article II, including without limitation local permits that
are necessary to install or operate The 38 GHZ facilities.
8.3 Licensee shall exercise reasonable efforts to seek renewal of each of its
Licenses in accordance with FCC rules and to protect the validity of its
Authorizations provided that Licensee shall not be obligated to seek
reinstatement of its Authorizations should they expire or to seek reinstatement
of its Authorizations should they be revoked or rescinded by a Final Order.
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8.4 In the event that any action is brought or threatened against ART or
Licensee by a third party or any governmental or judicial body with jurisdiction
alleging ART's misuse of the Authorizations, ART shall exercise reasonable
efforts to defend Licensee and the validity of the Authorizations from such
action, including responsibility for all reasonable costs and expenses,
including attorney's fees. "Misuse" as used in this Section 8.4 shall not
include any actions against ART or Licensee or challenging the validity of the
Authorizations based upon this Agreement or the other agreements referenced
herein or related hereto. Notwithstanding anything to the contrary contained in
this Section 8.4, ART shall have no obligation to seek to change or modify any
FCC or state utility commission rules or to otherwise participate in any FCC or
state utility commission proceedings of general applicability that might effect
the Authorizations or ART's obligations under this Agreement.
ARTICLE IX
TERM
The initial term of this Agreement shall be five (5) years from the date of
execution ("Initial Term"). This Agreement shall automatically renew for a three
(3) year term at the end of the Initial term ("First Successor Term") unless
either Party gives Notice of termination no less tan one hundred twenty (120)
days in advance of the end of the Initial Term. This Agreement shall
automatically renew for a two (2) year term at the end of the First Successor
Term unless either Xxxxx gives Notice of termination no less than one hundred
twenty (120) days in advance of the end of the First Successor Term.
ARTICLE X
TERMINATION
10.1 Either Party shall have a right to terminate this Agreement in the event
that the other Party commits a material breach of this Agreement and the breach
remains uncured for a period of thirty (30) days following Notice from the
non-breaching Party of the breach ("Initial Cure Period") in sufficient detail
to alert the breaching Party of the nature of the breach, provided that a longer
cure period shall be negotiated by the Parties if the nature of the alleged
breach does not permit cure within the Initial Cure Period.
10.2 Licensee shall have the right to terminate ("Licensee's Termination Right")
this Agreement in the event that ART is found to have violated any rule, policy
or Final Order of the FCC, any state utility commission, any local or municipal
agency or other governmental or judicial body with jurisdiction. The Licensee's
Termination Right shall arise by virtue either of a court of competent
jurisdiction or arbitrator finding of such violation or ART receiving actual
notice from the agency responsible for the Final Order, in which case ART shall
have thirty (30) days to cure such violation, provided that, if the Final Order
provides for a shorter period of time by which ART must abide by the terms of
the Final Order, the cure period shall be coextensive with the period provided
for in the Final Order. Licensee shall have the right to terminate this
Agreement immediately if the FCC's rules and policies concerning Licensee
control so require.
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10.3 In the event that this Agreement is terminated pursuant to Sections 10.1,
ART shall be granted the option to continue to provide Service to those
Customers that were being served on the date of the Notice or the date of the
issuance of the Final Order, under the provisions of this Agreement, for a
period of up to one-hundred twenty (120) days following the effective date of
the termination; provided that ART shall discontinue any Service that is
required to be terminated at such earlier date by the Final Order or if Licensee
is so ordered by the FCC.
10.4 In the event that this Agreement is found by a Final Order of the FCC or by
a court of competent jurisdiction to be invalid or illegal, Licensee has the
right to terminate this Agreement and require ART Immediately ICG cease
operations.
10.5 In the event that this Agreement is terminated by Notice not to renew in
accordance with Article IX, ART shall be granted the option to continue to
provide Service to those Customers that were being served on the date of the
expiration of this Agreement and to add Circuits to those Customers if the
Circuits are co-terminus with Circuits for such Customers in effect as of the
termination date, under the provisions of this Agreement, for a period of up to
two (2) years following the effective date of the termination.
10.6 The remedy provided in this section for a breach is not exclusive and the
Party asserting the breach may avail itself of all other remedies available at
law or equity.
10.7 In the event Licensee sells, transfers, assigns or otherwise disposes
(which sale, transfer, assignment or disposition is not in breach of Article V)
of the Authorizations to a Person other than ART, this Agreement shall remain in
full force and effect and shall be binding upon such other Person. In connection
with such sale, transfer, assignment or disposition, Licensee shall disclose
this Agreement to such other Person and require such other Person to execute an
assignment and assumption agreement. Nothing in this agreement shall be
construed as preventing Licensee's or ART's, successors, or assigns from using
the Authorizations provided that usage is in accordance with Section 2.7 of this
Agreement.
ARTICLE XI
CONFIDENTIAL INFORMATION
11.1 In connection with this Agreement, each party may disclose or otherwise
make available certain data or information to the other party, which data or
information the disclosing party considers to be confidential and proprietary.
As used herein, "Confidential Information," means any non-public information,
including Vendor lists, business plans and proposals, financial information,
marketing information, problem solving methods, implementation steps, know-how,
technology, trade secrets and drawings and renderings related to each party's
ongoing and proposed businesses, products and services which is being provided
or which has been provided to the receiving party by the disclosing party, or
which is obtained by the receiving party from its meetings and contacts with the
disclosing party, or any information derived by receiving party from information
so provided or obtained. Confidential Information includes all written or
electronically recorded materials identified and marked as confidential or
proprietary or which on their face appear to be confidential
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or proprietary, and oral disclosures of Confidential Information by the
disclosing party which are identified as confidential or proprietary at the time
of such oral disclosure.
11.2 Confidential Information does not include any of the following; (a)
information that is or becomes part of the public domain without violation of
this Agreement by the receiving party; (b) information that was known to or in
the possession of the receiving party on a non-confidential basis prior to the
disclosure to the receiving party by the disclosing party; information that was
developed independently by the receiving party's employees, which employees have
had no access to the Confidential Information; (d) information that is disclosed
to the receiving party by a third party under no obligation of confidentiality
to the disclosing party and without violation of this Agreement by the receiving
party; or (e) is authorized by the disclosing party in writing for disclosure or
release by the receiving party.
11.3 The parties agree: (a) to treat and keep as confidential and proprietary
all Confidential Information disclosed by the other party; (b) to advise each
employee to whom any Confidential Information is to be made available of the
confidential nature of such Confidential Information and of the terms of this
Agreement; to promptly return to the disclosing party (or its designees), upon
the disclosing party's request, all Confidential Information and all copies
thereof and to delete from electronic memory such Confidential Information.
11.4 The parties agree to keep confidential the terms of this Agreement,
including but not limited to information relating to the prices charged and
services provided by ART. The parties further agree that any disclosures
concerning this Agreement or the terms and conditions shall require the mutual
written consent of ART and Licensee, except as to such disclosures that may be
required to comply with securities laws, court order or similar order of an
administrative or regulatory agency, and in connection with relevant
governmental agency communications. Notwithstanding the foregoing, either party
shall be entitled to disclose this Agreement and the terms and conditions to its
financing sources, and to its auditors, attorneys and other agents to the extent
necessary to enforce such party's right or perform its obligations pursuant to
this Agreement; provided that such financing sources, auditors, attorneys and
other agents keep such information confidential.
11.5 The obligations of the Parties under this Article XI is intended to survive
the execution, delivery, performance and termination of this Agreement, and
shall so survive and shall continue in force and effect until the applicable
limitations period has expired.
ARTICLE XII
INDEMNIFICATION
12.1 Licensee hereby agrees to indemnity ART against, and to hold ART harmless
from, all losses, damages, costs and expenses, including without limitation
reasonable legal fees and disbursements, incurred by ART arising from acts,
occurrences or matters the existence or occurrence of which constitute a
violation of one or more representations, warranties or covenants of Licensee
hereunder, and do not relate to obligations or liabilities expressly assumed by
ART hereunder; provided, however, nothing contained herein shall obligate
Licensee with respect to, or negate or modify any liability of ART for breach of
ART's representations, warranties and covenants
13
in this Agreement. Licensee shall further indemnify, defend and hold harmless
ART from and against claims of third parties for property damage or personal
injury arising out of the negligent or willful acts or omissions of Licensee,
its agents, employees, contractors or representatives.
12.2 ART hereby agrees to indemnity Licensee against, and to hold Licensee
harmless from, all losses, damages, costs and expenses, including without
limitation legal fees and disbursements, incurred by Licensee arising from acts,
occurrences or matters the existence or occurrence of which constitute a
violation of one or more representations, warranties or covenants of ART
hereunder, and do not relate to obligations or liabilities expressly assumed by
Licensee hereunder; provided, however, nothing contained herein shall obligate
ART with respect to, or negate or modify any liability of Licensee for breach of
Licensee's representations, warranties and covenants in this Agreement. ART
shall flintier indemnity, defend and hold harmless Licensee from and against
claims of third parties for property damage or personal injury arising out of
the negligent or willful acts or omissions of ART, its agents, employees,
contractors or representatives.
ARTICLE XIII
LIMITATION ON ART's LIABILITIES
EXCEPT AS EXPRESSLY SET FORTH HEREIN, ART MAKES NO WARRANTIES OF ANY KIND WITH
RESPECT TO ANY OF THE EQUIPMENT, SERVICES AND RELATED SUPPORT SERVICES, WHETHER
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR CONFORMITY TO ANY
REPRESENTATION OR DESCRIPTION.
ARTICLE XIV
MISCELLANEOUS
14.1 ART expressly acknowledges that Licensee is required by FCC rules to
maintain ultimate control over the facilities used to provide Service. Licensee
shall at all times maintain such ultimate control as required from lime to time
by FCC rules and policies. Nothing in this Agreement shall be construed to limit
such control by Licensee or for Licensee to have ceded such control in any way
to ART. ART shall have no rights of use or control over the Authorizations
except as set forth in this Agreement.
14.2 If any agency, including without limitation the FCC or a state public
utility commission, or a judicial body, with jurisdiction, issues a Final Order
invalidating or voiding any xxxxx of this Agreement, or if, in the written
opinion of counsel to Licensee that is an expert in FCC rules and policies there
is a substantial likelihood that the FCC will so act and the action is likely to
become a Final Order, then the parties shall negotiate in good faith to amend
the Agreement to substitute a valid provision or provisions that most closely
approximate the invalidated provision(s).
14.3 All questions concerning the validity and operation of this Agreement and
the performance of the obligations imposed on the parties under this Agreement
shall be interpreted and construed in accordance with the domestic laws of the
State of Washington even if its choice of law provisions or statutes are in
conflict with this requirement.
14
14.4 Licensee expressly agrees that ART may use any subcontractor that it
chooses without prior approval for installation, maintenance, restoral and other
field service functions, and for any other ART obligations under this Agreement;
provided that the use of subcontractors shall not relieve ART of any of its
obligations hereunder.
14.5 Either Party may assign this Agreement (i) without notice or consent, to
any Affiliate that agrees in writing to be bound by the terms hereof or (ii) to
any other entity that expressly assumes in writing the terms and conditions of
this Agreement upon prior written consent from the other Party, which consent
shall not be unreasonably withheld.
14.6 This Agreement is made solely for the benefit of, and shall be binding
upon, the parties hereto and their respective successors and assigns.
14.7 The parties agree that all disputes, claims or controversies between them
arising out of or relating to this Agreement shall be settled as set forth in
this section 14.7. For the period of 15 days after Notice from either party, the
parties shall attempt in good faith to resolve the dispute by direct negotiation
of non-lawyer representatives of the parties. If the parties do not resolve the
dispute within such 15 day period, either party may submit the matter to a
professional mediation service selected by the parties. If the parties do not
resolve the dispute through mediation within an additional 30 day period, either
party may file a claim in a court of competent jurisdiction or otherwise pursue
all applicable legal remedies. The cost of mediation, including the fees and
expenses of the mediator, shall be paid equally by the parties.
14.8 It is agreed and understood that neither party is an agent, employee or
legal representative of the other, and has no authority to bind the other in any
way. Nothing in this Agreement shall be deemed to constitute ART and Licensee as
partners, joint venture partners, or otherwise associated in or with the
business of the other, and neither party shall be liable for the debts,
accounts, obligations or other liabilities of the other party, its agents or
employees. Neither party is authorized to incur debts or other obligations of
any kind on the part of or as agent for the other.
14.9 Neither party shall make any press release or other public announcement of
or otherwise disclose this Agreement, its contents, or the transactions herein
contemplated without the prior written approval of the other party unless
required by law, regulation, court order or rule of any securities exchange, in
which case the disclosing party shall promptly inform the other party of such
disclosure and shall permit it to intervene to object if such is permitted. The
foregoing shall not prohibit either party from disclosing this Agreement or its
contents to its attorneys, accountants or other advisors provided they are
informed of and bound by this Section 14.9 and Article XI.
Nothing contained in this Agreement shall preclude disclosures necessary to
comply with accounting and Securities and Exchange Commission ("SEC") disclosure
obligations and other disclosure obligations imposed by law, and in that regard
ART may file with the SEC reports, including, without limitation, SEC
registration statements or amendments thereto under the Securities Act of 1933,
as amended, which include a prospectus containing any information required to be
included therein and thereafter distribute said prospectus Licensee will
cooperate
15
with ART and provide such information and documents as may be required in
connection with any such filings.
14.10 NEITHER PARTY SHALL BE LIABLE FOR DELAYS IN PERFORMANCE, OR FAILURE TO
PERFORM THIS AGREEMENT OR ANY OBLIGATIONS HEREUNDER, WHICH ARE ATTRIBUTABLE TO
CAUSES BEYOND ITS REASONAI3LE CONTROL, INCLUDING BUT NOT LIMITED TO, OBSTRUCTION
OF LINE OF SIGHT BETWEEN SITES, FIRE, FLOOD, EPIDEMIC, EARTHQUAKE, ACT OF GOD,
LIGHTENING, PUBLIC POWER FAILURE OR SURGE, EXPLOSION, STRIKE OR OTHER LABOR
DISPUTE, RIOT OR CIVIL DISTURBANCE, WAR OR ARMED CONFLICT, OR ANY OTHER SIMILAR
OCCURRENCE NOT WITHIN ITS REASONABLE CONTROL.
14.11 All notices, demands or other communications which are required or may be
given under this Agreement shall be given or made in writing, and shall be
delivered personally or by overnight air courier or first class certified or
registered mail, return receipt requested and postage prepaid to the persons and
addresses listed below, or to such other persons and/or address as the party to
whom notice is to be given has furnished to the other party. Each such notice,
demand or other communication shall, simultaneously with its being delivered to
the courier or messenger for delivery or placed in the mail, be sent by
facsimile or comparable electronic means. All notices and other communications
hereunder shall be deemed to have been given: (a) on the date of delivery if
personally delivered on a business day or, if not delivered on a business day,
the first business day thereafter; (b) on the first business day after the date
sent if sent by overnight air courier; or (c) on the fifth business day after
the date Sent if sent by mail.
If to ART: If to Licensee;
Xxxxxx X. Xxxxxx PEDTS
President ___________________________________
000 000xx Xxx, XX, Xxxxx 0000 ___________________________________
Xxxxxxxx, XX 00000 ___________________________________
Tel: 000-000-0000 Tel:_______________________________
Fax: 000-000-0000 Fax:_______________________________
with copy to:
General Counsel's Office ICG
000 x00xx Xxx, XX, Xxxxx 0000 ___________________________________
Xxx0xxxx, XX 00000 ___________________________________
Attn: Xxxxxx X. Xxxxxx, Esq. ___________________________________
Tel: 000-000-0000 Tel:_______________________________
Fax: 000-000-0000 Fax:_______________________________
14.12 All Section Headings used in this Agreement are for convenience or
reference only and are not intended to define or limit the scope of any
provisions of this Agreement.
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14.13 No waiver of any right or remedy in respect to any occurrence or event on
one occasion shall be deemed a waiver of such right or remedy in respect of such
an occurrence or event on any other occasion.
14.14 Except as provided in Section 14.2, if any portion of this Agreement is
held to be invalid by a court of competent jurisdiction, that provision shall
become ineffective and unenforceable. The parties agree that such invalidity
shall not affect the validity of the remaining portions of this Agreement and
they further agree to substitute for the invalid provision a valid provision
that most closely approximates the effect and intent of the invalid provision.
14.15 The words and phrases used herein shall have the meaning generally
understood in the telecommunications industry and the microwave radio industry.
This Agreement shall be construed in accordance with its fair meaning and nor
for or against either party because of the identity of the party drafting or
proposing a provision.
14.16 This Agreement may be executed in any number of counterparts, each of
which shall, when executed, be deemed to be an original, but all of which
together shall constitute one and the same instrument. This Agreement may be
executed and deemed effective and binding if executed and exchanged by
facsimile, provided that promptly thereafter original signatures are exchanged.
14.17 This Agreement and all Attachments hereto constitute the entire agreement
between the parties hereto and supersedes all prior representations, agreements,
understandings and arrangements, oral or written, between the parties with
respect to the subject matter. This Agreement allocates the risks of loss among
the parties according to their express agreement, which allocation is reflected
in the charges and terms and conditions set forth herein. Except as otherwise
provided for
17
herein, this Agreement may not be released, discharged, amended or modified in
any way except by a writing that expressly refers to this Agreement and is
executed by all parties hereto.
IN WITNESS WHEREOF, and intending to be legally bound, the undersigned parties
have duly executed this Agreement effective as of the date first above written.
ART: LICENSEE:
ADVANCED RADIO TECHNOLOGIES PACIFIC & EASTERN DIGITAL
CORPORATION, a Delaware TELECOM SERVICES, INC.
Corporation a ________________ Corporation
By:____________________________ By:____________________________
Name:__________________________ Name:__________________________
Title:_________________________ Title:_________________________
ICC TELECOM GROUP, INC.
a Colorado Corporation
By:____________________________
Name:__________________________
Title:_________________________
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EXHIBIT 1
Location FCC File # Call Sign Latitude/Longitude Block
-------- ---------- --------- ------------------------
Beverly Hills, CA 565-CF-P/L-92 XXX000 00-00-00X/000-00-00X 00-00-00X/000-00-00X
Xxx Xxxxxxx, XX 566-CF-P/L-92 WMW450 34-22-30N/118-22-30W 33-37-30N/118-07-30W
* Palm Springs, CA 567-CF-P/L-92 WMW451 34-52-30N/116-30-30W 33-45-00N/116-22-30W
Riverside, CA 568-CF-P/L-92 XXX000 00-00-00X/000-00-00X 00-00-00X/000-00-00X
Xxxxx Xxxxxxx, XX 569-CF-P/L-92 XXX000 00-00-00X/000-00-00X 00-00-00X/000-00-00X
Xxx Xxxxxxxxxx, XX 570-CF-P/L-92 WMW454 34-15-00N/117-30-00W 34-00-00N/117-07-30W
* Santa Monica, CA 571-CF-P/L-92 WMW455 34-30-00N/119-00-00W 34-07-30N/118-30-00W
* San Diego, CA 572-CF-P/L-92 WMW456 32-52-30N/117-15-00W 33-32-43N/116-52-30W
Santa Xxxx, CA 573-CF-P/L-92 WMW457 34-15-00N/118-07-30W 33-37-30N/117-45-00W
* Ventura, CA 574-CF-P/L-92 WMW458 34-30-00N/119-22-30W 34-07-30N/119-00-00W
* The Parties acknowledge that these licenses have discrepancies as set forth in
Section 7.3.
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