Exhibit 10.54
DIRECTORY SALES AGREEMENT
THIS AGREEMENT dated as of November 19, 1999, is entered into by and
between IONEX Telecommunications, Inc., a Delaware corporation (the "Company"),
and Advanced Communications Group, Inc., a Delaware corporation ("ACG").
WITNESSETH
WHEREAS, ACG is engaged in the Telecommunication Business (as defined in
the Stock Purchase Agreement dated as of July 14, 1999 and as amended in the
First Amendment to the Stock Purchase Agreement of the even date herewith
between the Company, ACG and certain subsidiaries of ACG (the "Stock Purchase
Agreement"));
WHEREAS, the Company has agreed to acquire the Telecommunication
Subsidiaries (as defined in the Stock Purchase Agreement) of ACG, subject to the
closing conditions referenced in the Stock Purchase Agreement, including without
limitation, the receipt of certain governmental and other consents and approvals
as described therein;
WHEREAS, ACG owns all of the outstanding shares of Great Western
Directories, Inc., a Texas corporation, (ACG, Great Western Directories, Inc.
and their successors and assigns being collectively referred to herein as the
"Sales Agents");
WHEREAS, the Sales Agents are engaged in the business of publishing yellow
pages directories in certain markets within the United States and selling
advertising space within such directories; and
WHEREAS, the Sales Agents desire to provide certain sales, marketing and
promotional services to the Company in conjunction with the Sales Agents' own
sales, marketing and promotional activities, and the Company desires to receive
such sales, marketing and promotional services from the Sales Agents.
The parties hereto agree as follows:
1. Capitalized terms not otherwise defined herein shall have the
definitions given in the Stock Purchase Agreement.
2. The Company agrees to engage the Sales Agents as a provider of Sales
Services (as hereinafter defined) in the markets in which the Sales Agents are
currently publishing and distributing, and will in the future publish and
distribute, yellow pages directories (the "Territory") for a period of five (5)
years commencing on the date hereof (the "Initial Term"). The Company may extend
the duration of the Initial Term for one additional five (5) year period by
providing written notice, no less than ninety (90) days prior to the expiration
of the Initial Term, to all of the Sales Agents of its intention to so extend
the initial Term (the Initial Term, together with the extension thereto, if any,
being hereinafter referred to as the "Term"). The Sales Agents agree to act as a
provider of Sales Services (as hereinafter defined) in the Territory during the
Term. The term, "Sales Services," as used herein, shall mean those services
relating to
the sale, marketing and promotion of the Company's products and services,
including, but not necessarily limited to the following:
a. Soliciting potential customers of the Company in conjunction with the
Sales Agents' own customer solicitation efforts;
b. Marketing and promoting the Company's products and services to
potential customers of the Company;
c. Selling the Company's products and services;
d. Taking orders for the Company's products and services;
e. Obtaining customer leads for, and communicating them to, the Company;
and
f. Other ancillary services required in the performance of (a) through
(e) above.
The Sales Agents agree that during the Term, as defined above, the Sales
Agents will faithfully render the Sales Services and the Company will be the
only company or entity active in the telecommunications industry to which the
Sales Agents provide Sales Services. The Sales Agents shall render the Sales
Services in compliance with any and all Laws, including but not limited to, any
and all Laws relating to the provision of the products and services offered by
the Company.
3. Subject to the terms of this SECTION 3, the Company shall pay to the
Sales Agents during the Term a commission in an amount equal eighteen percent
(18.0%) of the aggregate revenues collected (excluding taxes and regulatory
charges) by the Company attributable to xxxxxxxx made for each of the Company's
products and services during the second, third, fourth and fifth months after
the initial sale of each of such products and services that are the Direct
Result of the Sales Services of the Sales Agents (it being understood that a
sale will be deemed to be the "Direct Result" of the Sales Services of the Sales
Agents only if such Sales Agents [VALIDATE] prospective customers, present
products and services to such prospective customers and consummate a sale of
such products and/or services with such customers as evidenced by a written
order). (the "Commission"). In addition to the other payments contemplated in
this SECTION 3, the Company shall pay to the Sales Agents twenty-five Dollars
($25.00) for every Qualified Lead reported to the Company by the Sales Agents.
The term, "Qualified Lead," as used in this Agreement, shall be determined in
the sole discretion of the Company and shall be subject to change as the Company
deems necessary or appropriate. The Company shall pay the Sales Agents the
Commission and Qualified Lead payments monthly, within thirty (30) days after
the end of the month in which the Commissions or the Qualified Lead Payments as
the case may be, have been earned, based on the revenues collected during the
previous month and the number of Qualified Leads during such month.
4. The Company shall provide the Sales Agents with: (i) all marketing,
promotional and other documentation necessary for the Sales Agents to provide
the Sales Services; (ii) training on the Company's products and services, which
training will be consistent with such
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training provided to the Company's own sales force; and (iii) an order entry
process designed to ensure the quality of service called for in Section 7
hereof.
5. The Company shall, in its sole discretion, establish the prices at
which it will offer the products and services promoted, marketed and sold
through the Sales Services of the Sales Agents.
6. Except as set forth below, the Company shall have no right to
terminate payments to the Sales Agents hereunder except for violation of any of
the provisions of this Agreement or willful failure to perform Sales Services
after written notice of such violation or failure to perform services on behalf
of the Company has been delivered to the Sales Agents and the Sales Agents have
failed to correct such violation or to perform such services within fifteen (15)
business days after the receipt by the Sales Agents of such written notice,
which shall specifically identify the alleged violation or failure.
7. In performance of the Sales Services, the Sales Agents will employ
methods and procedures of a quality at least equal to those employed when the
Sales Agents perform similar services for their own businesses and affairs.
8. The Sales Agents are, and shall remain at all times, independent
contractors of the Company in the performance of all Sales Services hereunder,
and all persons employed by the Sales Agents to perform such Sales Services
shall be and remain employees solely of the Sales Agents by which they are
employed and subject only to the Sales Agents' respective supervisory personnel.
In addition, the Sales Agents shall not hold themselves out to any person as
employees of the Company or as having the authority to obligate the Company in
any way.
9. The Sales Agents have no authority to commit the Company in any
manner, cause or undertaking whatever, without the prior consent of the Company
and similarly, the Company has no authority to commit the Sales Agents in any
matter, cause or undertaking whatever without the prior consent of the Sales
Agents.
10. The Sales Agents have no authority to make representations,
commitments or guarantees not specifically authorized by the Company.
11. The Sales Agents shall abide by and comply with all sales policies and
operating regulations of the Company, as in effect, from time to time, and of
which the Sales Agents have been made aware in writing prior to the taking of
effect of such sales policies and operating regulations, if future changes do
not materially alter the terms of this Agreement. If the Sales Agents believe
that changes in the Company's sales policies and operating regulations have
materially altered the terms of this Agreement, the Sales Agents shall give the
Company written notice of such belief before taking any action contrary to the
sales policies and operating regulations then in effect.
12. The Sales Agents shall be responsible for hiring all employees of the
Sales Agents and paying all wages, costs and expenses thereof.
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13. Confidentiality.
a. For purposes hereof, "Confidential Information" means any and all
information of the Company that might reasonably be considered
confidential, secret, sensitive, proprietary or private. To the extent
practical, Confidential Information shall be marked "proprietary" or
"confidential." Confidential Information shall include the following:
(1) Data, know-how, formulae, processes, designs, sketches,
photographs, plans, drawings, specifications, samples, reports, lists,
financial information, studies, findings, inventions and ideas, or
proprietary information relating to either party or the methods or
techniques used by either party;
(2) Data, documents, or proprietary information employed in
connection with the marketing and implementation of each party's
products, including cost information, business policies and
procedures, revenues, markets, distributor and customer lists, and
similar items of information; and
(3) Any other data or information obtained by either party
during the Term which is not generally known to and not readily
ascertainable by proper means by third persons who could obtain
economic value from its use or disclosure.
b. The Sales Agents shall treat as confidential all Confidential
Information that comes into the Sales Agents' knowledge through their
provision of Sales Services to the Company under this Agreement. The Sales
Agents shall take any reasonable steps necessary to prevent disclosure of
any Confidential Information to any third person as they would take in
protecting their own proprietary or confidential information and shall not
use any portion of the Confidential Information for any purpose not
authorized herein.
c. No person receiving Confidential Information shall be under any
obligation imposed by this Section with respect to any Confidential
Information (i) which is, at the time of disclosure, available to the
general public, (ii) which becomes at a later date available to the general
public through no fault on its part and then only after said later date,
(iii) which it can demonstrate was in its possession before receipt from
the discloser, (iv) which is disclosed to it without restriction on
disclosure by a third party who has the lawful right to disclose such
information, or (v) after fifteen years from the date of receipt of such
information.
14. The Company shall indemnify and hold harmless the Sales Agents,
their employees, their subsidiaries, and their subsidiaries' employees from
and against all claims, damages, losses and expenses (including reasonable
attorneys' fees) arising from the content or out of the provision of Sales
Services. Notwithstanding the foregoing, however, the Company shall have no
obligation to indemnify the Sales Agents against any claims, damages, losses,
or expenses in connection with the provision of Sales Services arising from
any violation by the Sales Agents of any law or any of the Companies' sales
policies or operating regulations, or the
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gross negligence or willful misconduct of the Sales Agents, their employees,
their subsidiaries, and their subsidiaries' employees or for any liability,
loss, or damage the Sales Agents might suffer as a result of the Sales
Agents' breach of this Agreement.
15. The Sales Agents shall indemnify and hold harmless the Company, its
employees, its subsidiaries, and its subsidiaries' employees from and against
all claims, damages, losses and expenses (including reasonable attorneys' fees)
arising from the content or out of the provision of Sales Services.
Notwithstanding the foregoing, however, the Sales Agents shall have no
obligation to indemnify the Company against any claims, damages, losses, or
expenses in connection with the provision of Sales Services arising from the
gross negligence or willful misconduct of the Company, its employees, its
subsidiaries, and its subsidiaries' employees or for any liability, loss, or
damage the Company might suffer as a result of the Company's breach of this
Agreement.
16. This Agreement shall be governed by and construed and enforced in
accordance with the internal laws of the State of Delaware without giving effect
to the principles of conflicts of law thereof.
17. Any notice, request, instruction or other document to be given
hereunder by a party hereto shall be in writing and shall be deemed to have been
given (a) when received if given in person or by courier or a courier service,
(b) on the date of transmission if sent by telex, facsimile or other wire
transmission or (c) six (6) Business Days after being deposited in the U.S.
mail, certified or registered mail, postage prepaid;
a. If to the Sales Agents, addressed as follows:
Advanced Communications Group, Inc.
Xx. Xxxxxxx X. Xxxxx
000 Xxxxx Xxxxxxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Facsimile No: (000) 000-0000
with a copy to:
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx, LLP
000 Xxxxx Xxxxxx 24' Floor
St. Louis, MO 63 101
Attn: Xxxxxxx X. Xxxxxx
Facsimile No: (000) 000-0000
b. If to the Company, addressed as follows:
IONEX Telecommunications, Inc.
0000 Xxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx
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Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx, Xxxxx & Xxxxx
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
Facsimile No: (000) 000-0000
or to such other individual or address as a party hereto may designate for
itself by notice given as herein provided.
18. The Sales Agents may not assign their rights or sub-contract or
delegate their performance hereunder without the prior written consent of the
Company, and any attempted assignment, sub-contracting or delegation without the
Company's prior written consent shall be void.
19. The validity or enforceability of any particular provisions of this
Agreement shall not affect the other provisions hereof, and this Agreement shall
be construed in all respects as if such invalid or unenforceable provisions were
omitted.
20. The failure of a party hereto at any time or times to require
performance of any provision shall in no manner affect its right at a later time
to enforce the same. No waiver by a party of any condition or of any breach of
any term, covenant, representation or warranty contained in this Agreement shall
be effective unless in writing, and no waiver in any one or more instances shall
be deemed to be a further or continuing waiver of any such condition or breach
in other instances or a waiver of any condition or breach or any other term,
covenant, representation or warranty.
21. This Agreement may be executed in one or more counterparts, each of
which when so executed shall be deemed an original, but all of which together
shall constitute one and the same instrument.
22. The use of the masculine, feminine or neuter gender herein shall not
limit any provision of this Agreement. The use of the terms "including" or
"include" shall in all cases herein mean "including, without limitation" or
"include, without limitation," respectively.
23. In the event either party to this Agreement commences any litigation,
proceeding or other legal action in connection with or relating to this
Agreement or any matters described or contemplated herein, with respect to any
of the matters described or contemplated herein, the parties to this Agreement
hereby (a) agree under all circumstances absolutely and irrevocably to institute
any litigation, proceeding or other legal action in a court of competent
jurisdiction located within the City of Dallas, Texas, whether a state or
federal court, (b) agree that in the event of any such litigation, proceeding or
action, such parties will consent and submit to personal jurisdiction in any
such court described in clause (a) of this Section and to service of process
upon them in accordance with the rules and statutes governing service of process
(it being understood that nothing in this Section shall be deemed to prevent any
party from seeking
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to remove any action to a federal court in Dallas, Texas), (c) agree to waive
to the full extent permitted by law any objection that they may now or
hereafter have to the venue of any such litigation, proceeding or action in
any such court or that any such litigation, proceeding or action was brought
in an inconvenient forum, (d) designate, appoint and direct CT Corporation
System as its authorized agent to receive on its behalf service of any and
all process and documents in any legal proceeding in the State of Texas, (e)
agree to notify the other party to this Agreement immediately if such agent
shall refuse to act, or be prevented from acting, as agent and in such event,
promptly to designate another agent in the City of Dallas, Texas,
satisfactory to the Sales Agents and the Company, to serve in place of such
agent and deliver to the other party written evidence of such substitute
agent's acceptance of such designation; (f) agree as an alternative method of
service to service of process in any legal proceeding by mailing of copies
thereof to such party at its address set forth herein for communications to
such party; (g) agree that any service made as provided herein shall be
effective and binding service in every respect; and (h) agree that nothing
herein shall effect the rights of any party to effect service of process in
any other manner permitted by Law.
EACH PARTY HERETO WAIVES THE RIGHT TO TRIAL BY JURY IN ANY DISPUTE IN CONNECTION
WITH OR RELATING TO THIS AGREEMENT OR ANY MATTERS DESCRIBED OR CONTEMPLATED
HEREIN, AND AGREE TO TAKE ANY AND ALL ACTION NECESSARY TO APPROPRIATE TO EFFECT
SUCH WAIVER.
24. This document constitutes the full understanding between the parties
and no terms, conditions, understanding or agreement purporting to modify or
vary the terms of this Agreement shall be binding unless hereafter made in
writing with reference to this Agreement and signed by the Sales Agents and a
duly authorized representative of Company.
[The remainder of this page intentionally left blank.]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
IONEX TELECOMMUNICATIONS, INC.
By: /s/ R.C. Xxxx Xxxxx
Name: R.C. Xxxx Xxxxx
Title: Chief Executive Officer
ADVANCED COMMUNICATIONS GROUP, INC.
(on its own behalf and on behalf of the
Sales Agents)
By: /s/ Xxxxxxx X. X'Xxxx
Name: /s/ Xxxxxxx X. X'Xxxx
Title: Chairman and Acting
Chief Executive Officer
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