[SBC LOGO] EXHIBIT 10.1
FIRST AMENDMENT TO SENT PAID SERVICES AGREEMENT
FROM SBC PAY PHONES BETWEEN SBC SERVICES, INC. AND PHONE1, INC.
THIS FIRST AMENDMENT dated this 31st day of March 2003 ("Amendment
Effective Date"), is by and between Phone1, Inc., with offices at 000 X.
Xxxxxxxx Xxxx., 00xx Xxxxx, Xxxxx, Xxxxxxx, 00000 ("Phone1") and SBC Services,
Inc., as agent for one or more of the following, depending upon the state(s) in
which service is provided hereunder for pay phone services: Pacific Xxxx
Telephone Company, a California corporation, d/b/a SBC California; Nevada Xxxx
Telephone Company, a Nevada corporation, d/b/a SBC Nevada; Southwestern Xxxx
Telephone, L.P., a limited partnership under the laws of the state of Texas,
providing pay phone service in the states of Texas, Missouri, Kansas, Arkansas,
and Oklahoma, d/b/a SBC Southwest; Illinois Xxxx Telephone Company, an Illinois
corporation, d/b/a SBC Illinois; Xxxxxxx Xxxx Telephone Company, Incorporated,
an Indiana corporation, d/b/a SBC Indiana; Michigan Xxxx Telephone Company, a
Michigan corporation, d/b/a SBC Michigan; The Ohio Xxxx Telephone Company, an
Ohio corporation, d/b/a SBC Ohio; Wisconsin Xxxx, Inc., a Wisconsin corporation,
d/b/a SBC Wisconsin; SNET America, Inc., a Connecticut corporation, and, where
the state in which pay telephones pursuant to this Agreement are located is
other than one of the foregoing, Ameritech Payphone Services, Inc., a Delaware
corporation, with offices at 000 Xxxxxxxxxx Xxxxxx, Xxxx 00-X-00, Xxx Xxxxxxx,
Xxxxx 00000.
WHEREAS, on December 10, 2002, Phone1 and SBC executed a Sent Paid
Services Agreement From SBC Pay Phones with an Effective Date of December 10th
2002, with an initial term of three (3) years (the "Agreement"), and expiring
pursuant to the terms set forth in Section 2 of the Agreement; and
WHEREAS, the parties desire to amend the Agreement at this time in the
manner set forth herein.
NOW THEREFORE, in consideration of the mutual obligations set forth
herein, Phone1 and SBC agree as follows:
1. Phone1 shall provide, at their sole cost and expense, a number of
smart-set chassis ("Smart-Set Chassis"), the number of which to be determined by
SBC, but not to exceed fifty thousand (50,000). For the purposes of this
Amendment, Smart-Set Chassis shall mean one or more microprocessors that can be
installed within the housing of a pay telephone in order to enhance calling and
communication features, and allows for a pay phone to communicate with the
Phone1 platform. The manufacturer of the Smart-Set Chassis shall be determined
by SBC. The Smart-Set Chassis shall be installed by SBC, at SBC's expense, at
specific locations, which in SBC's sole determination offer the highest usage
potential for the Phone1 Services ("High-End Locations"). SBC
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shall use reasonable best efforts to install the Smart-Set Chassis within 60
days of receipt by SBC, with shipping schedule determined by SBC.
2. The term of the Agreement, as it applies to each of the Smart-Set
Chassis at the High-End Locations only, shall continue for a period of time
equal to thirty-six (36) months, commencing upon the installation of each smart
set chassis.. At the conclusion of the of the aforementioned 36 month period,
the commission plan for each of the phones covered by this Amendment will then
convert to the commission terms as set forth in Section 6 of the Agreement. [*]
It is understood and agreed to by both Parties that the Smart-Set Chassis'
covered by this Amendment (up to fifty thousand (50,000)) are to be included in,
and not in addition to, the two-hundred thousand (200,000) public pay telephone
stations referenced in Section 4.A.
3. The monthly commissions to be paid by Phone1 to SBC for calls placed
on the Smart-Set Chassis' installed at the High-End Locations and subject to
this First Amendment shall be calculated per pay phone based on the following
criteria:
Gross Revenue Commission Owed
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Up to and including Break Point [*]
Break Point - 2x Break Point [*] (of original commission schedule)
Over 2x Break Point [*] (Of original commission schedule)
The Break Point shall be defined as the average cost to Phone1 per Smart-Set
Chassis', less [*], divided by thirty-six (36). For the sake of example only,
and not representative of actual costs; assuming average costs to develop
Smart-Set Chassis = [*]. Break Point would equal [*]. Based on this example, any
phone earning up to and including [*] in any given month, commission owed to SBC
will be [*]. For revenue between [*] and [*], commissions owed to SBC would be
[*] of the amount to which SBC is entitled under Section 6 of the Agreement. Any
revenue over [*] would result in a commission payment to SBC equal to [*] of the
amount to which SBC is entitled under Section 6 of the Agreement.
4. Phone1 shall not vary its pricing for domestic and international
calls on the basis of the technology selected, procured and utilized for the
Smart-Set Chassis'.
5. SBC shall have the right to relocate such Smart-Set Chassis to an
alternate High-End Location based on total revenue performance of the set (All
Revenue Streams).
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* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2.
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6. If domestic and international long distance Gross Receipts falls
below one hundred and fifty percent (150%) of Break Point for three months
consecutively, both parties agree to promptly meet to negotiate arrangements to
remedy the situation.
7. All other terms and conditions of the Agreement shall remain
unchanged.
IN WITNESS WHEREOF, the parties have caused this First Amendment to be
executed by their duly authorized representatives.
SBC SERVICES, INC., AS AGENT FOR
THE COMPANIES LISTED ABOVE PHONE1, INC.
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxx Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxx Name: Xxxxx Xxxxxxxxx
Title: President Public Communications Title: Chief Executive Officer
Date: April 1, 2003 Date: April 1, 2003
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