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CONFIDENTIAL
MEMORANDUM OF UNDERSTANDING
This MEMORANDUM OF UNDERSTANDING is entered into on this 16th day of April, 1999
by and between HighwayMaster Corporation ("HMC"), with its principal place of
business located at 0000 Xxx Xxxxx, Xxxxxxxxxx, Xxxxx 00000 and Criticom
International Corporation ("CIC"), with its principal place of business located
at 0000 Xxxx 00xx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000.
WHEREAS, HMC desires to engage CIC and CIC desires to provide certain alarm
monitoring services as more specifically set forth below herein;
NOW THEREFORE, premises considered the parties agree as follows:
1. General. The parties agree that the terms and conditions contained herein
are binding upon the parties. However, the parties agree to execute a
formal agreement which will at a minimum contain these terms and conditions
by April 27, 1999.
2. Definitions:
"Monitoring Service" shall mean receiving and responding appropriately to
panic alarm signals as set forth in the HighwayMaster Corporation
Specification for Series 5005S Panic Alarm Monitoring attached hereto as
Exhibit C.
"Subscriber" shall mean a HighwayMaster customer(s) at the company level.
Does not refer to individual users of HMC Unit.
"User" shall mean an individual employee of Subscriber who uses Series
5005S mobile unit.
"Unit" shall mean an individual HighwayMaster Series 5005S mobile unit.
3. Exclusivity
CIC shall be the exclusive provider of Monitoring Services for Units. HMC
shall have the right to contract with an alternative alarm monitoring
vendor to provide Monitoring Services as a redundant backup, but only
during the period of time that CIC is unable to provide offsite redundant
Monitoring Services of similar service functionality to CIC's primary
monitoring center. HMC and CIC will mutually agree upon CIC's redundant
site specifications and the proportionate share of the costs to be borne by
HMC for the redundant site.
4. CIC Responsibilities
4.1.1. CIC shall use its best efforts to have a system tested and
operational by May 11, 1999, to begin providing Monitoring
Services for Users. HMC understands that the availability of
Monitoring Services may be adversely affected by the
completion by third party vendors of certain programming and
other events
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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beyond the reasonable control of CIC. HMC and CIC shall use
their best efforts to encourage the third party vendors to
complete the programming within the necessary time frames to
ensure the delivery of the Monitoring Services by May 11,
1999. [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE SEC.]
4.2. CIC shall coordinate the development and integration of an automation
package to serve the Subscribers. See the "Dispatch Automation
System" section for more information.
4.3. HMC and CIC agree that CIC's sole obligation with respect to any
Subscriber shall be to monitor signals received from Units and to
respond thereto. CIC shall, upon receipt of signal from a Unit, make
every reasonable effort to transmit notification to the Public Safety
Answering Point ("PSAP") and/or to the person or persons whose names
and telephone numbers are provided by HMC, which are updated as
needed, unless CIC has reason to believe that the alarm may be false.
4.3.1. [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED
SEPARATELY WITH THE SEC.]
4.4. CIC recognizes that the Units are designed, in part, for improvement
in the safety for Users, and as such, shall provide sufficient
personnel to perform the Monitoring Services twenty four (24) hours
for each and every day of the year. CIC will provide sufficient
personnel to mitigate delays with regard to alarms or other emergency
requests by Users generated via Units.
4.5. CIC shall provide all necessary personnel, hardware, computers,
telephone systems to perform the Monitoring Services except as
provided by HMC as listed in EXHIBIT B: HMC PROVIDED EQUIPMENT AND
SOFTWARE.
4.6. CIC shall maintain an Underwriter's Laboratories approved listing for
commercial fire for a monitoring center, although HMC understands
that Underwriter's Laboratories does not provide listing services for
mobile security central stations. If Underwriter's Laboratories
listing for mobile security becomes available, and HMC requires it,
then CIC shall obtain it at that time.
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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4.7. CIC shall provide HMC with daily electronic access to User's alarm
history, statistical information and database as defined in the
Specification for Series 5005S Panic Alarm Monitoring provided to CIC
in March 1999.
4.8. CIC shall coordinate the implementation and design of the Monitoring
Services with HMC.
4.9. [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.]
4.10. [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.]
4.11. The contract shall include a service level agreement indicating key
performance indicators that will be met by both parties. Such
indicators shall be mutually agreed upon. Additional indemnification
language will be necessary to limit liability of both parties.
4.12. CIC represents that it is licensed at the state level to provide
Monitoring Services where applicable in the 48 contiguous states of
the United States of America except for the states of Utah and
Virginia. CIC will make every reasonable attempt to ensure PSAP(s) do
not deny response based on the absence of appropriate licenses and/or
certifications.
5. HMC's Responsibilities
5.1. HMC agrees to make payments to CIC as set forth herein.
5.2. HMC shall use its best efforts to require new Subscribers, other than
SBC Communications, Inc. and its member companies ("SBC"), to provide
indemnification to CIC.
5.3. HMC will provide all software and hardware under a Software
("Software") License Contract necessary for the correct and continued
operation of the Units as provided for in EXHIBIT B: HMC PROVIDED
EQUIPMENT AND SOFTWARE.
5.4. Both Parties will jointly create the procedures for an orderly
transfer of new Users for activation.
5.5. [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.]
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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5.6. HMC shall promptly notify CIC of any complaint or question regarding
the Monitoring Services.
5.7. Unit Design and Installation
5.7.1. HMC agrees that CIC shall have no responsibility for the
sale, design, installation, maintenance or repair of
equipment located as part of the Units of the Users.
5.7.2. HMC agrees to install and maintain Units using high quality
equipment, techniques, and practices. HMC agrees to make
every reasonable effort to correct and control Unit or User
deficiencies causing false signals. If any Unit sends an
unreasonable number of false signals which materially
impairs CIC's ability to provide the Monitoring Services,
CIC may temporarily suspend the provision of Monitoring
Services to the malfunctioning Unit.
5.8. HMC shall be solely responsible for all risks and expenses incurred
in connection with its actions in the sale or use of Units or
Monitoring Services or any other acts of HMC.
5.9. Governmental Requirements
5.9.1. HMC agrees to pay any and all sales, use or business taxes
or impositions by Municipal, State, Federal and/or other
authorities in connection with the Monitoring Services to be
provided by CIC except for sales, use or business taxes
assessed on the net income or gross revenues of CIC. If CIC
is required to obtain additional licenses, HMC and CIC will
reach agreement on reimbursement to CIC for said additional
required licenses.
5.9.2. HMC and/or HMC with CIC's assistance, shall provide and
mail, at HMC's own expense, all announcements or notices
required to be mailed to Users as required by any regulatory
agency.
5.9.3. In the event a fine, penalty or fee is assessed against CIC
by any governmental or municipal agency as a result of any
signal originating from Units, HMC agrees to forthwith
reimburse CIC for same as long as the fine, penalty or fee
is not assessed on CIC because of CIC's wilfull misconduct
and/or gross negligence.
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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6. Dispatch Automation System
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.
THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
7. Payment
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.
THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
7.4. Payment by HMC shall be received by CIC within Thirty (30) days from
the date of invoice from CIC.
7.5. Under no circumstances will HMC's inability to collect from the
Subscriber delay payment to CIC.
8. Term
8.1. The term of the formal agreement shall commence at the time that a
minimum of 12,000 Units are activated and monitored by CIC and shall
continue thereafter for three (3) years. If SBC terminates its
agreement with HMC or fails to activate at least 12,000 units for
Monitoring Service, HMC shall have the right to terminate the 12,000
Unit minimum requirement upon ninety (90) days written notice without
liability but the formal agreement shall continue in effect for three
years from the date of the execution of the formal agreement.
8.2. The formal agreement shall automatically renew for successive two
year terms unless 120 days written notice of intent not to renew is
provided by either party. Both parties agree to cooperate in the
event of termination and if necessary grant an extension if more time
is required for a smooth transition of Monitoring Services.
9. HMC and CIC represent and warrant that their respective equipment and
services are Year 2000 compliant.
10. The understandings set forth in this Memorandum of Understanding are
binding upon each of the undersigned individuals, their heirs, successors
and assigns.
11. The terms and conditions of this Memorandum of Understanding are strictly
confidential and shall not be disclosed to any third parties without the
prior written consent of the other party but the parties may disclose only
the existence of this Memorandum of Understanding and the formal agreement
without revealing any of the terms contained therein.
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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CRITICOM INTERNATIONAL CORP. HIGHWAYMASTER CORPORATION
By: (x) Xxxxxxx X. Xxxxxx By: (x) W. Xxxxxxx Xxxxx
---------------------------------- ---------------------------------
Name: Xxxxxxx X. Xxxxxx Name: W. Xxxxxxx Xxxxx
-------------------------------- -------------------------------
Title: VP Development Title: Chief Financial Officer
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Date: 4/19/99 Date: 4/16/99
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CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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EXHIBIT A: PRICE LIST
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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EXHIBIT B: HMC PROVIDED EQUIPMENT AND SOFTWARE
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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EXHIBIT C
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
CONFIDENTIAL REVISED 12:10 P.M. APRIL 16, 1999
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