1
Note: Information in this document marked with "[*]" has been omitted and filed
separately with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
EXHIBIT 10.7
=============================================================================
AMENDED AND RESTATED
BROADBAND ACCESS SERVICES SUPPLY AGREEMENT
BY AND BETWEEN
THE MICROSOFT NETWORK L.L.C.
AND
STARBAND COMMUNICATIONS INC.
DATED AS OF OCTOBER 20, 2000
=============================================================================
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CONTENTS
SECTION 1. DEFINITIONS.............................................................................................1
SECTION 2. PERFORMANCE OF WORK.....................................................................................1
SECTION 3. TRIAL PERIOD............................................................................................2
SECTION 4. FULL AVAILABILITY.......................................................................................5
SECTION 5. USB-CPE SUPPLY..........................................................................................5
SECTION 6. PAYMENTS...............................................................................................10
SECTION 7. TAXES..................................................................................................11
SECTION 8. MOST FAVORED CUSTOMER; COMPETITIVE OFFERING............................................................12
SECTION 9. MSN MINIMUM COMMITMENT.................................................................................12
SECTION 10. MARKETING AND MSN CUSTOMER RELATIONSHIPS...............................................................13
SECTION 11. EXPANSION..............................................................................................15
SECTION 12. EXCLUSIVITY............................................................................................15
SECTION 13. REPRESENTATIONS AND WARRANTIES.........................................................................17
SECTION 14. COVENANTS..............................................................................................18
SECTION 15. INTELLECTUAL PROPERTY RIGHTS...........................................................................19
SECTION 16. GENERAL INDEMNITY......................................................................................22
SECTION 17. RISK OF LOSS...........................................................................................24
SECTION 18. TERM...................................................................................................24
SECTION 19. EVENTS OF DEFAULT; REMEDIES............................................................................25
SECTION 20. RELATIONSHIP OF PARTIES................................................................................29
SECTION 21. GENERAL PROVISIONS.....................................................................................29
3
ANNEXES
Annex A Definitions
Annex B-1 Statement of Work
Annex B-1.2 Form of StarBand Trademark License to be added by November 6,
2000
Annex C Service Level Agreement
Annex D Nondisclosure Agreement
Annex E Termination Agreement
Exhibit 1 Performance Guarantee Agreement by Gilat
Satellite Network, Ltd. dated
February 15, 2000
Exhibit 2 Agreement Relating to Gilat Supply Agreement
Annex F CPE Plan
Annex G Network Operations Plan
Annex H Additional Revenue Services Agreement
Annex I Master Agreement Between StarBand, Gilat and Spacenet, Inc.
Dated September 29, 2000
Annex J Form of Confidentiality Agreement
Annex K Telecommunications Services Agreement
Annex L Statement of Work Pursuant to Telecommunications Services
Agreement
Schedule 1 USB-CPE Pricing Chart
Schedule 2 Warranty Pricing and Information Chart
ii
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AMENDED AND RESTATED BROADBAND ACCESS SERVICES SUPPLY AGREEMENT
This Amended and Restated Broadband Access Services Supply
Agreement is entered into as of the 20th day of October, 2000 (the "Effective
Date") (as from time to time amended, modified or supplemented, the "Amended
Agreement"), by and between The Microsoft Network L.L.C., a Delaware limited
liability company ("MSN"), and StarBand Communications, Inc., a Delaware
corporation (formerly known as Gilat-to-Home, Inc.) ("StarBand").
RECITALS
WHEREAS, StarBand is owned by Spacenet Inc. ("Spacenet"), a
Delaware corporation and wholly-owned subsidiary of Gilat Satellite Networks,
Ltd., an Israeli corporation ("Gilat"), Microsoft G-Holdings, Inc., a Nevada
corporation ("Microsoft Holdings"), and other shareholders and was established
for the purpose of providing satellite Internet access to North American
consumers, small business and home office customers and ISPs (including MSN)
serving such customers;
WHEREAS, StarBand desires to sell to MSN, and MSN desires to
purchase from StarBand, services and equipment for broadband access via
satellite to MSN and the Internet for use by MSN Customers; and
WHEREAS, the original Broadband Access Supply Agreement, dated
February 15, 2000, entered into between Microsoft Network L.L.C. and
Gilat-To-Home, Inc. (the "Agreement") no longer reflects the actual
circumstances of the arrangements under which the Parties are operating and
the Parties' desired business relationship, the Parties now collectively
desire to amend and restate this Agreement.
AGREEMENT
In consideration of the above premises and the mutual covenants and
agreements contained herein, the Parties agree as follows:
SECTION 1. GENERAL DEFINITIONS
As of the Effective Date, the Agreement is replaced in its entirety
by this Amended Agreement.
Capitalized terms used in this Amended Agreement will have the
meanings given those terms in Annex A (Definitions).
SECTION 2. PERFORMANCE OF WORK
In accordance with this Amended Agreement, StarBand will provide
the Work and the Service, including broadband ingress and egress via satellite
to and from MSN and the
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Internet for use by MSN Customers in the Service Territories. The Work will
include (a) supplying all CPE, satellite capacity, satellite network
equipment, and other items necessary for the Work and for the provision by
StarBand of the Service, (b) all installation, operations, help desk and other
services as set forth on Annex B-1 (Statement of Work) attached hereto and (c)
such other items, products and services that are reasonably necessary (and
generally within the scope of the products, services and other items that are
to be provided by StarBand as contemplated by this Amended Agreement) for the
Work or for the provision of the Service.
SECTION 3. TRIAL PERIOD
3.1 TRIAL PERIOD
For purposes of this Amended Agreement, the period of time from and
after the Effective Date to and including the Full Availability Date (as
defined below in Section 3.1.1), shall be referred to herein as the "Trial
Period". The Trial Period will end upon satisfaction, in accordance with this
Amended Agreement, of criteria set out in this Section 3.1.
3.1.1 CRITERIA
(a) The Trial Period will commence on the Effective Date and
will continue until the requirements of this Section 3.1.1 have been satisfied
(such date being referred to herein as the "Full Availability Date").
(b) During the Trial Period for those MSN Employee Customers
who have Service Access through participation in MSN's Pilot Satellite Testing
Program, MSN will not charge a fee for each such MSN Customer's access to the
MSN Service for twelve (12) months. The number of such MSN Employee Customers
will not exceed five-hundred (500), and MSN will stop adding MSN Employee
Customers after November 17, 2000. Pursuant to Section 6.2 of this Amended
Agreement, MSN will also be responsible for connectivity costs from the point
of ingress among the StarBand Networks Operation Center (the "StarBand NOC"),
the Internet and MSN. StarBand shall be responsible for all other costs
related to the implementation of the Service for such MSN Employee Customers,
including providing MSN Customers with free CPE, free CPE installation and
providing to MSN (for MSN Employee Customers) free satellite service for
twelve (12) months.
(i) For every non-USB-CPE unit sold through
Consumer Sales Channels , MSN shall pay StarBand [*]. For avoidance of doubt,
the MSN Pilot Satellite Testing Program shall not be a Consumer Sales Channel.
(c) During the Term of the Amended Agreement, including the
Trial Period, the provision of the Service will be governed by:
(i) The Network Operations Plan (the "NOP") (Annex
G), including incorporation into the NOP of the Network Performance
Plan; and
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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(ii) the Service Level Agreement (the "SLA") (Annex
C).
In addition, the Parties will use best efforts to
complete the CPE Plan by November 6, 2000 (the "CPE Plan") (which will then be
added to this Amended Agreement as Annex F). The CPE Plan will include a
development plan for the USB Boxes ("USB-CPE"), including a development
schedule and descriptions of all USB-CPE (including model numbers) made
available to any person by or on behalf of StarBand. StarBand agrees that the
USB-CPE development schedule will provide for proposed specifications
regarding all USB-CPE models to be provided by StarBand to MSN during the
Trial Period. In addition, StarBand agrees that it will provide MSN with
periodic status reports regarding StarBand's efforts with respect to such
USB-CPE development.
(d) StarBand shall deliver to MSN, for MSN's approval (such
approval not to be unreasonably withheld), the final proposed specifications
regarding the Primary USB-CPE, as setout in the CPE Plan no later than October
20, 2000 and receive MSN approval of such specifications. Such specifications
shall be detailed and shall take into consideration, among other things,
Primary USB-CPE testing parameters, equipment reliability, equipment
performance, ease of consumer installation and use, compatibility with
existing PC systems and ease of servicing (the "Primary USB-CPE
Specifications"). Upon receipt of such specifications, MSN shall have fifteen
(15) days within which to review such proposed specifications. A condition to
completing the Trial Period will be the Parties' agreement on final
specifications with respect to such Primary USB-CPE and incorporation of the
testing provisions into the NOP. StarBand warrants and agrees that it will,
and will cause Gilat to, supply to MSN and MSN Customers USB-CPE in strict
conformity with the agreed specifications. StarBand further agrees that, with
respect to the agreed specifications applicable to Primary USB-CPE being
supplied to MSN Customers, it will not, without MSN's prior written consent,
alter or modify such agreed specifications in the products delivered to MSN in
any manner whatsoever. If there are various models of USB-CPE which StarBand
can deliver to MSN for use during the Trial Period, the Parties shall agree on
what USB-CPE model shall be the primary USB-CPE to be delivered by StarBand to
MSN (the "Primary USB-CPE") no later than October 31, 2000. During the Trial
Period, MSN may purchase, test or resell any USB-CPE made available by
StarBand, to any person or entity. StarBand shall promptly notify MSN of the
availability of any such USB-CPE and provide a reasonable number of such
USB-CPE for testing, provided, however that resolution of issues relating to
non-Primary USB-CPE shall not be a condition to ending the Trial Period.
(e) By November 6, 2000, the Parties shall agree on the terms
and conditions of, and execute trademark licenses as contemplated by Section
15.1 of this Amended Agreement, and StarBand shall deliver to MSN an executed
copy of the intellectual property license agreement to be entered into by and
between StarBand and Gilat (such license agreement to be in form and substance
satisfactory to MSN). In addition, StarBand and Spacenet will adopt a
statement of work with respect to the Telecommunications Services Agreement
(such statement of work to be in form and substance satisfactory to MSN) which
will be appended as Annex L no later than November 6, 2000. Such statement of
work shall include, but not be limited to, performance criteria applicable to
Spacenet's performance thereunder. The
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Parties have also agreed on the terms and conditions of the StarBand
Confidentiality Agreement referred to in Section 14.4 of this Amended
Agreement (and it is appended as Annex J).
(f) No later than February 28, 2001, StarBand shall complete
Delivery to MSN of no fewer than One Hundred (100) units of the Primary
USB-CPE (the "Test Units"). "Delivery" shall be achieved when (1) StarBand has
installed all of the Test Units with MSN Employee Customers in accordance with
this subsection (f) and (2) StarBand certifies to MSN in writing, that the
Test Units comply with the specifications for the Primary USB-CPE. If MSN
determines that the Test Units significantly deviate from the Primary USB-CPE
Specifications, MSN shall describe the specific steps required before MSN will
accept the Test Units for testing. For thirty (30) days following Delivery,
MSN shall evaluate the Test Units using testing criteria previously agreed
upon and incorporated into the NOP. At the end of this thirty (30) day test
period, StarBand shall have forty-five (45) days to correct any deficiencies
in the Test Units and/or the Service identified by MSN.
(i) In the event that StarBand completes Delivery
of the Test Units before February 28, 2001, then the time periods set out in
subsections (f), (g) and (h) of this Section 3.1.1 shall begin to run from the
date Delivery is achieved.
(g) StarBand shall provide at least twenty-one (21) days
prior written notice of the date upon which StarBand anticipates commencing
installation of the Test Units (the "Notice of Availability"). Within five (5)
days of receiving the Notice of Availability, MSN shall supply StarBand with
the names and addresses of one hundred and twenty-five (125) MSN Employee
Customers who will participate in the evaluation of the Test Units. MSN will
assist in facilitating StarBand's installation of at least one hundred (100)
of the Test Units by February 28, 2001. StarBand shall expeditiously complete
installation of Primary USB-CPE for all one hundred and twenty-five (125) MSN
Employee Customers. The delivery and installation of all Primary USB-CPE units
required in this paragraph shall be at no cost to MSN.
(h) Should StarBand achieve Delivery by February 28, 2001,
then MSN will use reasonable best efforts to work with StarBand to achieve
acceptance of the Test Units by May 15, 2001 ("Acceptance Date"). For every
one (1) day beyond February 28, 2001 that StarBand fails to achieve Delivery,
the Acceptance Date shall be extended by one (1) day. On or before the
Acceptance Date, MSN shall notify StarBand whether MSN accepts the Primary
USB-CPE for commercial distribution. If MSN notifies StarBand that MSN accepts
the Primary USB-CPE, then the provisions of Section 12 of this Amended
Agreement shall be null and void as of such notification. If MSN notifies
StarBand that MSN does not accept the Primary USB-CPE, then StarBand may
either (i) extend the Acceptance Date for a specified period of time during
which all provisions of this Amended Agreement including Section 12 will
remain in full force and effect, or (ii) release MSN from any obligation, cost
or liability for the Minimum Commitment described in Section 9 of this Amended
Agreement. If StarBand chooses to release MSN from the Minimum Commitment,
then the
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provisions of Section 12 of this Amended Agreement shall be null and void as
of such waiver.
(i) In the event MSN does not accept the Primary USB-CPE by
the Acceptance Date, as such date may be extended by StarBand as provided
above, and regardless whether StarBand elects to waive the Minimum Commitment,
the Parties will continue to work together to correct any deviations from the
USB-CPE Specifications and to achieve MSN's acceptance of the Primary USB-CPE;
provided, however, that if MSN has not accepted the Primary USB-CPE by
December 31, 2001, StarBand shall have no further obligation to pay the
ongoing costs of providing Service to Radio Shack stores as required under
Section 5.2.9. as of that date.
(j) During the Trial Period, the Parties will agree on the
allocation, after the Full Availability Date, of shipping charges applicable
to the shipment back to StarBand of failed USB-CPE units provided, however,
that StarBand shall bear the cost of return shipping during applicable
warranty periods, as set out in Schedule 2.
SECTION 4. FULL AVAILABILITY
Upon the successful achievement of the Trial Period, the Service
will be fully available under terms of this Amended Agreement as of the Full
Availability Date.
SECTION 5. CPE SUPPLY
5.1 CPE SUPPLY DURING TRIAL PERIOD
Not less than on a bi-weekly basis during the Trial Period, MSN
shall, if it has generated one or more new MSN Customers, send to StarBand a
purchase order for CPE to be supplied to MSN Customers during the Trial Period
(each a "Trial Period Purchase Order"). Each Trial Period Purchase Order will
set forth in reasonable detail (i) the number of CPE units to be purchased,
(ii) the name or names of the MSN Customer or MSN Customers that are to
receive such CPE, (iii) the location or locations to which such CPE is to be
delivered and (iv) such other information as may be reasonably requested by
StarBand. The Parties intend that, during the Trial Period, all CPE is to be
shipped directly from StarBand to each MSN Customer listed in a Trial Period
Purchase Order. StarBand agrees that it shall, after receiving a Trial Period
Purchase Order, promptly (i) process such Trial Period Purchase Order and (ii)
arrange for the installation of CPE for each MSN Customer described in the
related Trial Period Purchase Order. Subject to the last sentence of this
Section 5.1, title to CPE shall not be transferred from StarBand to an MSN
Customer until such CPE is successfully installed for such MSN Customer. From
the Effective Date until the Full Availability Date, so long as title to CPE
is retained by StarBand, all risk of loss with respect to such CPE, and all
costs, fees, taxes, duties and expenses (including insurance expenses) related
to the shipment of such CPE, shall be borne by, and be for the account of,
StarBand. StarBand agrees that it shall, prior to the completion of the Trial
Period, submit to MSN for MSN's approval (such approval not to be unreasonably
withheld) (x) the insurance
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policy or policies that shall cover the risk of loss applicable to CPE during
the Term and (y) a list of shipping companies that StarBand may from time to
time use for shipping CPE to all destinations during the Term. If, during the
Trial Period, StarBand demonstrates to MSN's reasonable satisfaction that it
has developed an infrastructure for the timely and efficient shipping and
installation of CPE, then the provisions set forth in Section 5.2.5 relating
to transfer of title and risk of loss shall, thereafter apply to this Section
5.1 to the same extent as though set forth in this Section 5.1. MSN shall, at
all times during the Trial Period, have the right to reject CPE that does not
conform to the terms of a Trial Period Purchase Order and the terms of this
Amended Agreement.
5.2 USB-CPE SUPPLY AFTER THE FULL AVAILABILITY DATE
5.2.1 AGREEMENT TO PURCHASE
Subject to the terms of this Section 5.2 and Section 4 of Annex B-1
to this Amended Agreement, from and after the Full Availability Date, MSN
agrees to purchase (or designate other Persons to purchase) from StarBand, and
StarBand agrees to sell to MSN, USB-CPE in accordance with the terms of this
Amended Agreement. StarBand warrants and agrees that it will, or will cause
Gilat to, supply USB-CPE in strict conformity with the agreed specifications.
Notwithstanding any other provision of this Amended Agreement, MSN may test
and distribute, in its discretion, any USB-CPE, provided, offered, distributed
or sold by or on behalf of StarBand, Gilat or any affiliate of StarBand or
Gilat to any person or entity.
5.2.2 PURCHASE PROCEDURES
(a) After the Full Availability Date, and until this Amended
Agreement is terminated, MSN or MSN's designee will (and upon the satisfaction
in full of MSN's Minimum Commitment, MSN may) from time to time purchase from
StarBand USB-CPE by sending to StarBand a purchase order (each a "Purchase
Order"). Each Purchase Order shall be sent to StarBand not less than forty
five (45) days prior to the date on which MSN wishes to have its USB-CPE order
completed. Each Purchase Order will set forth in reasonable detail (i) the
number of USB-CPE units to be purchased, (ii) the date on which MSN, or MSN's
designee, expects to take delivery, or, if such USB-CPE is to be delivered to
a third-party retail distributor, the date on which such third-party retail
distributor expects to take delivery, (iii) the Authorized Delivery Location
(as defined below) at which the USB-CPE is to be delivered and (iv) such other
information as may from time to time be reasonably requested by StarBand.
StarBand warrants and represents that MSN Purchase Orders to meet the Minimum
Commitment set out in Section 9 of this Amended Agreement will be completed
and shipped promptly and MSN will receive priority of supply over any USB-CPE
orders for third parties so long as the requirements of Sections 5.2.6 and
5.2.7 are met.
(b) All orders placed by MSN or MSN's designee pursuant to
this Amended Agreement shall be processed and distributed by StarBand
promptly, and in all events, within at least thirty (30) days from and after
the date on which StarBand shall have received a
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Purchase Order from MSN. StarBand shall deliver the fulfilled purchase order
to the location specified in each Purchase Order.
(c) StarBand agrees that it shall cooperate with efforts made
by MSN to enter into one or more third-party retail distribution arrangements
with respect to reselling USB-CPE pursuant to this Amended Agreement to MSN
Customers, and that it will take such additional actions with respect to, and
execute and deliver such additional documents relating to, such arrangements
as MSN may from time to time reasonably request and terms and conditions to be
agreed upon by the Parties.
5.2.3 CPE PRICING
All CPE purchases made by MSN in accordance with the terms of this
Amended Agreement will be subject to, and receive all benefits afforded by,
Section 8.1 of this Amended Agreement. During the Term of this Amended
Agreement, in no event will the pricing of CPE purchased by MSN under this
Amended Agreement exceed the amounts set forth on Schedule 1 attached hereto
(the "CPE Pricing Schedule"). The prices payable by MSN with respect to CPE
shall, in all events, be inclusive of shipping and insurance charges in
accordance with Section 5.2.5 of this Amended Agreement.
5.2.4 INCORPORATION BY REFERENCE
The Parties agree and acknowledge that the terms set forth in
Section 4 of Annex B-1 to this Amended Agreement shall govern all CPE
purchases made by MSN in accordance with this Amended Agreement.
5.2.5 AUTHORIZED DELIVERY LOCATIONS; RISK OF LOSS;
TITLE TRANSFER
(a) For purposes of this Amended Agreement, "Authorized
Delivery Location" means the delivery locations from time to time designated
by MSN in writing to StarBand; provided that in no event shall the number of
Authorized Delivery Locations exceed fifty (50) such locations and all shall
be located within the United States.
(b) Title to, and risk of loss with respect to, CPE shall
transfer from StarBand to MSN upon the shipment of CPE from StarBand's United
States warehouse to an Authorized Delivery Location. The CPE prices set forth
on Schedule 1 attached hereto include all shipping and insurance costs related
to each such shipment. Until title to CPE has been transferred (as described
above), all risk of loss with respect to such CPE, and all costs, fees, taxes,
duties and expenses, including insurance expenses, related to the shipment of
such CPE to, and while in, StarBand's United States warehouse, shall be borne
by, and be for the account of, StarBand. Thereafter, except for the
StarBand-provided insurance required by the second sentence above (and except
as provided in the last sentence of this subsection (b)), all risk of loss
with respect to such CPE shall be borne by MSN or MSN's designee. From and
after the delivery of CPE to a Subcontractor performing CPE installation
services on StarBand's behalf (including when StarBand acts on its own behalf
as the installer), until the time at which such CPE is successfully installed
for an MSN Customer, all risk of loss with
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respect to, and all costs, fees, taxes, duties and expenses, including
insurance expenses, related to, such CPE shall revert (without any further act
or agreement by the Parties) to being borne by, and being for the account, of
StarBand.
(c) MSN or MSN's designee, as the case may be, shall
acknowledge the transfer of title to CPE described above by executing and
delivering to StarBand (by telecopy or otherwise) a receipt signed by MSN or
MSN's designee, as the case may be, acknowledging receipt of such CPE. MSN
shall, at all times during the Term, have the right to reject CPE that does
not conform to the terms of a Purchase Order and the terms of this Amended
Agreement.
(d) If MSN submits to StarBand a Purchase Order and in such
Purchase Order requests that StarBand provide storage or warehouse services for
the CPE that is the subject of such Purchase Order, then MSN agrees that it
shall reimburse StarBand for the reasonable costs associated with storing such
CPE, including insurance costs and shipping and handling costs [*] of such
costs. The foregoing notwithstanding, MSN shall not be required to reimburse
StarBand for any such shipping and handling costs if the relevant CPE is
subsequently sent by StarBand to an Authorized Delivery Location. StarBand will
not be entitled to charge MSN warehousing fees with respect to any CPE not being
stored by StarBand at MSN's request.
5.2.6 USB-CPE MINIMUM PRODUCTION CAPACITY
To the extent MSN submits to StarBand USB-CPE orders pursuant to
this Amended Agreement, StarBand will be required to supply to MSN during any
four (4) month period (on a rolling basis) USB-CPE units up to the amount of
such units estimated by MSN (in a Production Forecast (as defined below)) as
being necessary to satisfy consumer demand for such rolling four (4) month
period (the "USB-CPE Minimum Production Capacity"). The USB-CPE Minimum
Production Capacity may from time to time be adjusted in accordance with
Section 5.2.7 of this Amended Agreement or as otherwise agreed in writing by
the Parties.
5.2.7 MARKET PROJECTIONS
Monthly from and after the Full Availability Date, MSN will provide
to StarBand a four (4) month rolling forecast (the "Production Forecast")
regarding consumer demand for the Service, including all equipment related
thereto. Based on this forecast, MSN shall have the right, but not the
obligation, to require StarBand to increase the amount of USB-CPE to be
supplied to MSN by up to twenty-five percent (25%) beginning four (4) months
after the date on which MSN requested the production increase. If MSN
determines that it wishes to make such increased production request of
StarBand, then it shall notify StarBand of such request within twenty (20)
days of the date on which it completed the Production Forecast. StarBand shall
use commercially reasonable efforts to satisfy MSN's increased production
request.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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5.2.8 AGREEMENT RELATING TO GILAT SUPPLY AGREEMENTS
StarBand shall fully and promptly enforce its rights under the
Master Agreement by and among StarBand Communications and Gilat Satellite
Networks, Ltd. and Spacenet, Inc. dated September 29, 2000.
5.2.9 USB-CPE FOR THIRD-PARTY DEMONSTRATIONS
(a) StarBand agrees to provide non USB and USB-CPE at its
expense to RadioShack to enable RadioShack, at each of its retail locations at
which any installation has occurred as of the Effective Date of this Amended
Agreement, to demonstrate the Service to potential users in accordance with
the requirements of Annex B and the Service Level Agreement. StarBand shall
provide to RadioShack at its own expense the products, services and other items
relating to the provision of the Service as set forth in Section 2 of this
Amended Agreement (including StarBand providing to RadioShack Internet
connectivity at 384 Kbps). MSN agrees to reimburse StarBand for such
expenditures up to the amount of [*] for each RadioShack retail location and [*]
per month for ongoing operational costs. StarBand shall document such costs to
MSN in a manner reasonably acceptable to MSN for each such location. After the
Effective Date, the Parties will agree on an allocation of expenses for
installation at additional RadioShack locations.
(b) MSN will reimburse StarBand for those costs associated
with the implementation of a virtual private network (VPN) for RadioShack, to
the extent such implementation satisfies MSN's obligations to RadioShack under
the Internet Connectivity Strategic Alliance Agreement by and between MSN and
Tandy Corporation acting by and through its Radio Shack Division, dated
November 10, 1999. Any such reimbursement shall only be for those reasonably
incurred costs which are properly documented by StarBand and which represent
costs incremental to the costs expended by StarBand under Section 5.2.9(a).
For avoidance of doubt, nothing in this Section 5.2.9(b) shall prevent
StarBand from seeking reimbursement from Radio Shack, for any cost incurred
with regard to the VPN as to which MSN does not reimburse StarBand.
(c) Upon the agreement of the Parties, StarBand may supply
USB-CPE to major third party retailers selected by MSN in consultation with
StarBand. StarBand shall provide such retailer, in accordance with an
allocation of expenses negotiated in advance by the Parties, with the
products, services and other items relating to the provision of the Service
(including Internet connectivity).
5.2.10 The provisions of this Section 5.2 will also
apply to non-USB CPE supply.
5.2.11 Within thirty (30) days from the Effective
Date, StarBand will provide to MSN, for MSN's approval (such approval not to
be unreasonably withheld), a proposed standard form of subcontract to be
entered into by it with one or more Subcontractors who are to provide full
on-site USB-CPE installation services for MSN Customers. Such standard
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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form of contract shall ensure that the price payable by MSN Customers to
USB-CPE installers for USB-CPE installation does not exceed One Hundred
Seventy-Five Dollars ($175) per MSN In addition, StarBand agrees that such
contract shall also contain objective criteria against which each
Subcontractor's performance may be measured. StarBand furthermore agrees that
all Subcontractors used for USB-CPE installation shall be generally recognized
within that industry as being financially stable and providing high-quality
customer service. MSN will have fifteen (15) days within which to review such
contract. StarBand shall also, prior to the completion of the Trial Period,
provide to MSN, for MSN's approval (such approval not to be unreasonably
withheld), a proposed standard form of subcontract to be entered into by a
USB-CPE installer and an MSN Customer (the "MSN Customer Installation
Contract"). MSN will have fifteen (15) days within which to review such
contract. Such subcontract shall, amongst other things, be appropriate for use
in a consumer market (as reasonably determined by MSN) and contain terms and
conditions that are consistent with the those of the standard form of USB-CPE
installation subcontract referred to above. In no event shall StarBand,
without MSN's prior written consent, amend or modify the standard form of
subcontract to be entered into by (i) StarBand and any USB-CPE installer (as
such form of contract relates to the provision of USB-CPE installation
services for MSN Customers) or (ii) any USB-CPE Installer and an MSN Customer.
5.2.12 The Parties will conduct regular Program
Reviews beginning thirty (30) days after the Trial Period commences, during
which MSN and StarBand will compile and review MSN Customer survey results and
MSN technical evaluations with respect to the Service. StarBand will have
twenty (20) days within which to remedy any deviations from the Service Level
Agreement identified by MSN at the Program Review. All such remedial actions
will be agreed by the Parties prior to being implemented by StarBand. Such
Program Reviews will occur every thirty (30) days during the Term.
SECTION 6. PAYMENTS
6.1 MSN MONTHLY FEE
Beginning with the Full Availability Date, and subject to the
provisions of Section 6.3 of this Amended Agreement, MSN will pay to StarBand a
monthly fee, not to exceed [*] per month per MSN Customer, as reimbursement for
costs associated with StarBand providing to MSN and MSN customers satellite
capacity and network operation costs (other than USB-CPE) for each full month of
Service for an MSN Customer.
6.2 CONNECTIVITY FEE
In connection with the provision by StarBand of the Service, MSN,
will (a) on a monthly basis during the Trial Period, and (b) on a quarterly
basis thereafter, provide to StarBand the amount of terrestrial
telecommunications capacity required for MSN Customers for connection between
each StarBand NOC and the MSN NOC and to the point of ingress to the Internet
backbone. StarBand will then obtain such capacity on terms and from suppliers
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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reasonably acceptable to MSN and submit to MSN an itemized ▇▇▇▇ for such
Internet backbone-related costs, which are to be paid by MSN to StarBand
monthly. Normal monthly connectivity costs from the StarBand NOC to the MSN
NOC will be paid directly by MSN to an Approved Internet Provider. The
foregoing notwithstanding, MSN, at its option, may purchase such connectivity
directly from its own suppliers (in which case, StarBand will assist each such
supplier in the establishment of such connectivity, including the provision of
all necessary interfaces).
6.3 PAYMENT SCHEDULE
Subject to any reduction pursuant to the Service Level Agreement
set out in Annex C, payments of fees by MSN to StarBand will be determined by
MSN at the end of each month and will be paid within thirty (30) days
thereafter.
The amount of fees to be paid by MSN will be subject to the
performance requirements and corresponding reduction amounts set forth on
Annex C attached hereto. Any determination by MSN as to the amount of fees
will, absent manifest error, be conclusive and binding on StarBand.
6.4 PAYMENT LOCATION
Payments owing to StarBand under this Amended Agreement will be
made by MSN in Dollars by the required date of payment to the U.S. bank
account of StarBand at:
StarBand Communications, Inc.
Wachovia Bank
Charlotte, North Carolina
ABA # ▇▇▇▇▇▇▇▇▇
Account # 8731000698
SECTION 7. TAXES
Except as otherwise agreed herein, any sales, use, documentary
stamp, license, real or personal property transfer or gains tax, fee or charge
or any similar tax, fee or charge, whether imposed by any federal, state,
local, or foreign governmental authority, that is attributable to the sale,
transfer or provision of any product or service pursuant to this Amended
Agreement (a "Transfer Tax") shall be timely paid by the party obligated to
sell, transfer or provide such product or service hereunder (the "Obligated
Party"). The Obligated Party shall indemnify the other party (the
"Non-Obligated Party"), on an after-tax-basis, for any taxes, penalties,
costs, fees, expenses or losses imposed on or incurred by the Non-obligated
Party as a result of the Obligated Party's failure to pay such Transfer Tax.
The Non-obligated Party agrees to timely sign and deliver, at the request of
the Obligated Party, such forms or certificates as may be necessary or
appropriate to establish an exemption from (or otherwise reduce), or file tax
returns with respect to, such Transfer Tax. In connection with the
transactions contemplated herein, StarBand shall be solely responsible for the
payment and collection of any fees or charges assessed by, or payable to, the
FCC (except for the pro rata portion of any
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such fee required to be paid by an MSN Customer (such amount not to exceed, per
MSN Customer, [*]), which amount shall, as between MSN and StarBand, be for
MSN's account).
SECTION 8. MOST FAVORED CUSTOMER; COMPETITIVE OFFERING
8.1 MOST FAVORED CUSTOMER
In connection with satisfying its obligations under this Amended
Agreement, StarBand confirms that, at all times during the Term, it will
extend to MSN and MSN Customers pricing and other terms (including, but not
limited to, terms related to technical performance (including any
modifications or alterations to any USB-CPE specifications that improve the
performance of such USB-CPE), customer support, marketing and other related
commercial terms) that are at least as favorable as those prices and other
terms it extends to its other customers purchasing similar or smaller
quantities of USB-CPE and that such prices shall be no higher than, and such
terms will be no more onerous than, those extended to such other customers. If
at any time during the Term, the charges payable by MSN or MSN Customers under
this Amended Agreement are not as favorable, then StarBand will reduce prices
payable by MSN and MSN Customers to the same level as such other StarBand
customers, effective from the date that such prices were first applied by
StarBand to such other customers. StarBand will take similar actions if the
terms of its dealings with other customers are more favorable than those
extended to MSN and MSN Customers under this Amended Agreement.
8.2 COMPETITIVE OFFERING
StarBand will ensure, for MSN's benefit, that CPE and the Service
is, at all times during the Term, cost, price and performance competitive with
that from time to time being offered by any market leader offering two-way,
interactive, satellite-based Internet access in North America (the
competitiveness of any such offering is to be measured after giving effect to
any subsidy program or favorable equity investment that materially affects the
terms (including pricing) at which such market leader is able to offer to
consumers its service and other commercial parameters).
SECTION 9. MSN MINIMUM COMMITMENT
Subject to the successful completion of the Trial Period and so
long as no Event of Default has occurred or is continuing, then from and after
the Full Availability Date MSN (or parties designated by MSN) shall be obligated
to purchase from StarBand [*] Primary USB-CPE units at [*] per unit (the
"Minimum Commitment").
The Minimum Commitment shall be eliminated if at any time StarBand
is unable to supply Primary USB-CPE to MSN, in accordance with the Purchase
Orders and forecasts supplied by MSN to StarBand under Section 5.2 of this
Amended Agreement.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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In the event that MSN fails to satisfy the Minimum Commitment
during the Term of this Amended Agreement, then MSN shall pay to StarBand a sum
equal to [*] multiplied by the number of Primary USB-CPE units that MSN has
failed to purchase under the Minimum Commitment ("Shortfall") within sixty (60)
days following the termination or expiration of this Amended Agreement.
In the event that StarBand terminates this Amended Agreement for an
MSN Event of Default (after giving effect to any applicable cure periods),
StarBand's sole and exclusive remedy shall be a payment from MSN for the
Shortfall at the price of [*] per Primary USB-CPE unit.
In the event MSN terminates this Amended Agreement for a StarBand
Event of Default, then MSN shall have no cost or liability or any
responsibility for the Minimum Commitment.
SECTION 10. MARKETING AND MSN CUSTOMER RELATIONSHIPS
10.1 MARKETING AND ADVERTISING
MSN will have the exclusive right (exercisable at its sole
discretion) to advertise and market the availability of the Service to
potential MSN Customers and will be solely responsible for all costs of such
advertising and marketing, provided that MSN shall consult with StarBand with
respect to marketing and advertising for the Service, and StarBand will
provide such information and assistance as MSN may reasonably request in order
to advertise and market the availability of the Service to potential MSN
Customers. In all events, StarBand shall not, without MSN's written approval,
undertake any advertising or other promotions with respect to the MSN Service.
For avoidance of doubt, this Section shall not prohibit StarBand from general
marketing and advertising, so long as such marketing and advertising is not in
violation of Section 12 of this Amended Agreement.
10.2 PROVISION OF SERVICES
MSN will be free to provide the Service to any MSN Customer in the
Service Territories in its sole discretion.
10.3 MSN CUSTOMER RELATIONSHIP; BILLING; CERTAIN FEES
MSN will at all times have the sole right to, and ownership of, the
MSN Customer relationship, including, but not limited to, the right to control
and dictate the terms of use of the Service by an MSN Customer, the billing
relationship, advertising, marketing and all sale of other services and
activities associated with the Service, this Amended Agreement or otherwise.
Neither StarBand nor its Affiliates or Associates will be entitled to charge
or collect any fees from any MSN Customer except for the following:
(a) For MSN Customers electing to utilize StarBand USB-CPE
installation services, a USB-CPE installation fee not to exceed One Hundred
Seventy-Five Dollars
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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($175) per MSN Customer (the "One-Time Installation Fee") (provided that such
installation constitutes a "standard installation" as such term is defined in
the MSN Customer Installation Contract);
(b) Out-of-warranty maintenance fees shall be as set forth on
Schedule 2 attached hereto ("Out-of-Warranty Fees"). The Parties agree that no
Out-of-Warranty Fees shall be payable by, or collected from, any MSN Customer
during the Trial Period (all such work to be performed by StarBand during the
Trial Period without charge).
10.4 USE OF INFORMATION
StarBand will not have the right to use any information concerning
any MSN Customer, whether personally identifiable with the MSN Customer, in
the aggregate, technical, tracking or otherwise, except to the extent
necessary to provide MSN with the Service or as mutually agreed between the
Parties and will keep all such information confidential. MSN will not, and
will have no obligation to, share any MSN Customer information with StarBand
except as necessary for StarBand's provision of the required Service. StarBand
will, at MSN's request, provide MSN with copies of any and all MSN Customer
information it may obtain, and once any such information is no longer
necessary for StarBand to provide to MSN the Service, StarBand agrees to
destroy all such MSN Customer information (other than information residing in
the memory of a computer owned or leased by StarBand and which cannot be
readily erased or otherwise destroyed, in which case, such information shall,
in all events, remain subject to the prohibitions on use and disclosure set
forth in this Amended Agreement and the other Operative Documents) after first
providing MSN a copy or the original of such information.
10.5 PRICE OF SERVICES
MSN will have the exclusive right (exercisable at its sole
discretion) to set MSN Customer prices for all aspects of the Service, other
than the One-Time Installation Fee and the Out-of-Warranty Fees permitted to
be charged by StarBand to MSN Customers.
10.6 MARKETING TO MANUFACTURERS; BUNDLING OF SERVICE
(a) Upon MSN's request, StarBand will (and will cause Gilat
to) join MSN in approaching PC manufacturers to make the Service an optional,
orderable service at the time of PC purchase.
(b) MSN may consider, but is not committed to, bundling the
Service with other Microsoft products and services, including WebTV.
10.7 NO MINIMUM AMOUNT OF WORK OR NUMBER OF MSN CUSTOMERS
Subject to MSN's Minimum Commitment, MSN will have no obligation to
purchase a minimum amount of Work (or CPE) from StarBand or to guarantee a
minimum number of MSN Customers.
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10.8 MSN CUSTOMER USE OF ▇▇▇.▇▇▇ PORTAL
Pursuant to each Service Contract entered into by an MSN Customer,
each such MSN Customer will, in connection with their use of the Service, use
the ▇▇▇.▇▇▇ portal. Subject to the provisions of the Additional Revenue
Services Agreement and StarBand's right to retain the One-Time Installation
Fee and Out-of-Warranty Fees, MSN will be entitled to all advertising,
e-commerce and other revenue generated in connection with the ▇▇▇.▇▇▇ portal.
SECTION 11. EXPANSION
11.1 GEOGRAPHIC MARKET
The Service Territories will be expanded from time to time as set
forth below:
11.1.1 CANADA AND MEXICO
StarBand agrees to develop a plan for offering the Service in
Canada and Mexico beginning upon the Full Availability Date. StarBand
represents that it has the capability of providing the Service to MSN
Customers in Canada and Mexico subject only to obtaining landing rights from
the Governments of Canada and Mexico. StarBand agrees that it will promptly
apply for such landing rights and will use best efforts to obtain such rights
in consultation with MSN. Upon obtaining such landing rights, the Service
Territories will be expanded to include Canada and Mexico. StarBand will keep
MSN informed of its progress in obtaining such landing rights and will provide
updated timetables for commencement of the Service in Canada and Mexico.
11.1.2 GENERAL TERMS
All Work provided in the Service Territories, as from time to time
expanded in accordance with the terms hereof, will be subject to the terms and
conditions of this Amended Agreement; provided that if the costs for providing
the Work in countries other than the United States are less than the costs for
providing the Work in the United States, the fees to be paid by MSN to
StarBand will be reduced so as to provide StarBand with a profit margin
commensurate with its profit margin for such Work in the United States.
SECTION 12. EXCLUSIVITY
(a) Commencing on the Effective Date, StarBand may supply
non-USB-CPE and USB-CPE to any person, including any competitor of MSN, except
as provided subsection (b) of this Section 12.
(b) For the period beginning on the Effective Date and ending
on January 1, 2001:
(i) StarBand shall not provide, sell or distribute
any non-USB-CPE units, directly or indirectly, [*] to [*],
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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[*], [*], or [*] (or any affiliates or their respective successors, including
[*]) (collectively, "MSN Competitors");
(ii) Neither StarBand nor any MSN Competitor shall:
(i) make any public announcement of any agreement between them with respect to
sales of non-USB-CPE units, provided that StarBand may, to the extent required
by federal or state securities statute or regulation, make any disclosures of
any such agreement in its securities filings or other legally required
disclosure documents; or (ii) engage in any marketing, advertising or
promotion of non-USB-CPE units pursuant to any such agreement; and
(iii) StarBand may, during this period, distribute
non-USB-CPE units to MSN Competitors for the sole and limited purpose of
internal, non-commercial testing and evaluation, provided that under no
circumstances shall StarBand provide more than 500 test units to any MSN
Competitor.
From January 1, 2001 until the expiration of the exclusivity
restrictions set forth in subsection (c) below, StarBand shall submit any
public announcements (other than SEC or other regulatory filings, or documents
filed with a court), promotional or advertising material related to any MSN
competitor and the non-USB-CPE to MSN for MSN's review at least five days
prior to public release.
(c) For the period beginning on the Effective Date and ending
on the earlier of (i) MSN's acceptance of the Primary USB-CPE; and (ii)
StarBand's waiver of the Minimum Commitment (both as provided in Section
3.1.1(h) of this Amended Agreement):
(i) StarBand shall not provide, sell or distribute,
directly or indirectly (including through Compuserve) any USB-CPE to any MSN
Competitor; and
(ii) Neither StarBand nor any MSN Competitor shall:
(i) make any public announcement of any agreement between them with respect to
sales of USB-CPE units, provided that StarBand may, to the extent required by
federal or state securities filings or other legally required disclosure
documents; or (ii) engage in any marketing, advertising or promotion of
USB-CPE units pursuant to any such agreement.
(iii) StarBand may, during this period, distribute
USB-CPE units to MSN Competitors for the sole and limited purpose of internal,
non-commercial testing and evaluation, provided that under no circumstances
shall StarBand provide more than 500 test units to MSN Competitor.
(d) MSN shall have no exclusive obligations to StarBand with
respect to the subject matter of this Amended Agreement. Without limitation of
the foregoing, MSN has the right to make available to its Members the services
of other telecommunication services providers as well as any or all CPE from
alternate providers.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with repect to the
omitted portions
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SECTION 13. REPRESENTATIONS AND WARRANTIES
Each Party represents and warrants to the other Party that as of
the Effective Date:
13.1 ORGANIZATION; GOOD STANDING AND QUALIFICATIONS
It is a company duly formed and validly existing under the laws of
its state of formation; it has requisite company power and authority to own or
lease and operate its material properties and to carry on its businesses as
now conducted in all material respects; and it is duly qualified to transact
business and is in good standing in each jurisdiction in which the failure to
do so would have a material adverse effect on its ability to perform its
obligations hereunder.
13.2 AUTHORIZATION
It has the requisite company power and authority to enter into this
Amended Agreement and the other Operative Documents to which it is a party and
to carry out the transactions contemplated hereby and thereby; the execution,
delivery and performance of this Amended Agreement and the other Operative
Documents, and the consummation of the transactions contemplated hereby and
thereby, have been duly authorized by the requisite company action of such
Party and will not conflict with the articles of incorporation or certificate
of formation, as applicable, or the limited liability company agreement or
bylaws, as applicable, of such Party; and this Amended Agreement and each
other Operative Document to which it is a party is a valid and binding
obligation of such Party, enforceable against such Party in accordance with
its terms.
13.3 LITIGATION
There are no actions, suits, proceedings or investigations pending
or, to such Party's knowledge, threatened against such Party or any of its
Affiliates in connection with this Amended Agreement or any other Operative
Document or that, individually or in the aggregate, would otherwise have a
material adverse effect on such Party's ability to perform its obligations
hereunder or under any other Operative Document.
13.4 COMPLIANCE WITH LAWS
It and its Affiliates are in full compliance with all applicable
Laws of the United States and any other relevant Governmental Authority,
except where the failure to be in such compliance does not and is not
reasonably expected to have a material adverse effect on such Party's ability
to perform its obligations hereunder and, to the best of such Party's
knowledge, there is no material risk of such Party failing to obtain any
Governmental Approvals required to be obtained hereunder.
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13.5 COMPLIANCE WITH COMPANY DOCUMENTS AND AGREEMENTS
Neither its execution and delivery of this Amended Agreement or any
other Operative Document, nor its consummation of the transactions herein and
therein contemplated or compliance with the terms and provisions hereof and
thereof, will conflict with, result in a breach of, constitute a default under
or require any consent under any applicable Law or any agreement to which such
Party is a party or by which it is bound or to which it is subject, other than
consents that have been obtained or any conflicts, breaches, defaults or
failures to obtain consents that do not and are not reasonably expected to
have a material adverse effect on such Party's ability to perform its
obligations hereunder.
13.6 LICENSES AND GOVERNMENTAL APPROVALS
StarBand further represents and warrants that it has, or Spacenet
has duly assigned or otherwise made available to StarBand for use by StarBand,
all necessary agreements, licenses, certificates and authorizations from
telecommunications providers or governmental entities in order to provide the
Service to MSN and MSN Customers at standards commonly observed in the
telecommunications industry, as well as to perform its obligations under this
Amended Agreement and each other Operative Document to which it is a party.
StarBand further represents and warrants that the assignment or other method
by which Spacenet has made available to StarBand any agreement, license,
certificate or authorization in connection with the transactions contemplated
herein, is and will be in compliance with all applicable Law, will not
conflict with, result in a breach of, constitute a default under or require
any consent under any applicable Law or any agreement to which StarBand or
Spacenet is a party or by which either of them is, respectively, bound.
SECTION 14. COVENANTS
14.1 COMPLIANCE WITH LAWS
StarBand will perform its obligations under this Amended Agreement
in full compliance with all applicable Laws of the United States and any other
relevant Governmental Authority.
14.2 REGULATORY RESPONSIBILITIES
StarBand, at its expense, will obtain, defend and maintain in full
force and effect all Governmental Approvals required under applicable Law to
perform its obligations under this Amended Agreement (whether or not StarBand,
any Subcontractor, MSN or any other Person may be responsible under applicable
Law to obtain or maintain such Governmental Approval). If any Governmental
Approval sought by StarBand (or any of its Affiliates) is to include a
representation regarding the Work or the Service that reasonably could later
have a material adverse effect on MSN if such representation were later to
prove false or misleading, then StarBand, prior to the submission thereof,
will submit such application for MSN's approval. StarBand will promptly inform
MSN if it has knowledge of any requirement of any Governmental Authority that
may materially affect MSN's intended provision of the Service
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or the Work in connection therewith. During the Term, MSN will use, or will
cause to be used by an MSN designee, commercially reasonable efforts to notify
users, upon the execution of a Service Contract, that such user may be
required to obtain and maintain zoning permits or other similar licenses with
respect to the installation of USB-CPE on such user's real property. In
addition, StarBand agrees that the MSN Customer USB-CPE Installation Contract
shall include a provision requiring such installer to perform, at its own
expense, all actions reasonably necessary to assist such MSN customer in
obtaining any such zoning permits or similar licenses.
14.3 WARRANTY TO MSN CUSTOMERS
StarBand will supply to MSN (for MSN and for each MSN Customer) a
freely transferable warranty as required by Section 4.6 of Annex B-1
(Statement of Work).
14.4 CONFIDENTIALITY
All employees, agents, and Subcontractors of StarBand who are to
discharge any of StarBand's services and obligations under this Amended
Agreement will execute and deliver to StarBand a confidentiality agreement,
substantially in the form attached hereto as Annex J ("Confidentiality
Agreement"). StarBand will use its best efforts to ensure compliance by all
such individuals or entities with the terms and conditions of each such
Confidentiality Agreement. Promptly upon receipt thereof, StarBand shall
deliver to MSN, in accordance with the notice provisions set forth in this
Amended Agreement, a copy of each Confidentiality Agreement executed and
delivered to it pursuant to the terms of this Section 14.4.
14.5 NO AMENDMENTS
StarBand will not, without MSN's prior written consent, amend, or
consent to any amendment or modification of, any Operative Document to which
it is a party.
SECTION 15. INTELLECTUAL PROPERTY RIGHTS
15.1 CONTROL AND OWNERSHIP OF INTELLECTUAL PROPERTY
(a) Any use by StarBand of any names, logotypes, trade dress,
domain names or other trademarks or service marks of MSN, Microsoft or any of
their respective Affiliates on marketing and other materials promoting the
Service shall be subject to, and expressly conditioned upon, the terms of a
trademark license to be negotiated between the parties ("Trademark License")
and attached to this Agreement as Annex B-1.2. StarBand shall, at its own
expense, correct any specified misuses of such trademarks. Except as provided
in that Trademark License, nothing in this Amended Agreement shall grant to
StarBand any right, title, interest or license in or to any names, logotypes,
trade dress or other trademarks or service marks of MSN, Microsoft or any of
their respective Affiliates.
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(b) Any use by MSN of any names, logotypes, trade dress,
domain names or other trademarks or service marks of StarBand on marketing and
other materials promoting the Service shall be subject to, and expressly
conditioned upon, the terms of a trademark license to be negotiated between
the parties. Except as provided in that Trademark License, nothing in this
Amended Agreement shall grant to MSN any right, title, interest or license in
or to any names, logotypes, trade dress, domain names or other trademarks or
service marks of StarBand or any of its Affiliates.
15.2 BACKGROUND INTELLECTUAL PROPERTY
(a) "Background Intellectual Property" means all Intellectual
Property Rights that are owned or controlled by MSN or StarBand (or their
respective Associates) prior to this Amended Agreement and Intellectual
Property Rights with respect to Technology conceived or first reduced to
practice by such Party (or its respective Associates) contemporaneously with
this Amended Agreement but not arising from the performance of any Work or the
Service under this Amended Agreement.
(b) Each Party shall continue to own and control all of its
respective Background Intellectual Property. No licenses are granted under
such Background Intellectual Property except as may be expressly granted
herein or as otherwise agreed to, in writing, by the Parties.
15.3 FOREGROUND INTELLECTUAL PROPERTY
(a) "Foreground Intellectual Property" means all Intellectual
Property Rights with respect to Technology that is conceived or first reduced
to practice during the course of performing any Work or the Service under this
Amended Agreement by MSN or StarBand or their respective Associates.
(b) All Foreground Intellectual Property that is developed
solely by Associates of one of the Parties shall be and remain the exclusive
property of that Party. Each Party shall have the right, but not the
obligation, at its own expense, to apply for Statutory Intellectual Property
(as defined below) protection of the Intellectual Property Rights solely
created by its Associates hereunder. "Statutory Intellectual Property" means
all Intellectual Property Rights whose protection is governed by one or more
statutes or regulations that have been made effective by the United States or
foreign governmental body or that have been enacted by treaty. Statutory
Intellectual Property includes, but is not limited to, patents (including
utility patents, design patents, utility models and inventor certificates),
copyrights, trademarks, mask works, and any applications for the foregoing
types of Intellectual Property Rights. Statutory Intellectual Property does
not include Intellectual Property Rights whose protection is governed by
judicial common law (e.g., in the United States: trade secrets and know-how).
15.4 NO JOINT DEVELOPMENT
The Parties acknowledge and agree that no joint development is
intended under this Amended Agreement. Each Party shall continue to own and
control all of its respective
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Background Intellectual Property and Foreground Intellectual Property. No
licenses are granted by either Party under its respective Background
Intellectual Property or Foreground Intellectual Property except as may be
expressly granted herein or as otherwise agreed to, in writing, by the
Parties.
15.5 INTELLECTUAL PROPERTY INDEMNITY
(a) StarBand will defend, indemnify and hold harmless each
MSN Indemnified Person against any allegation or claim that the Service, the
Work, any CPE, any Deliverable Item, any Technology of or provided by
StarBand, or any component (including without limitation any trademark,
tradename or logos provided, pursuant to the Trademark License set forth in
Section 15.1) thereof infringes an Intellectual Property Right, and against
any damages, costs and other liabilities resulting from such allegation or
claim (whether during or after the Term of this Amended Agreement). Claims
procedures will be in accordance with Section 16.2 of this Amended Agreement.
(b) If StarBand acknowledges, or a competent tribunal
determines, that the Service, the Work, the CPE, any Deliverable Item, any
Technology of or provided by StarBand (including, but not limited to, service,
equipment and trademarks), or any component thereof infringes an Intellectual
Property Right of any Person other than StarBand, or an injunction issues
restricting the use, sale or other disposition thereof, StarBand will, at its
own expense:
(i) Procure the right for MSN and the MSN Customers
to continue using the Service, the Work, the CPE, any Deliverable Item or
Technology or component thereof (such right to be procured on terms and
conditions satisfying the requirements of this Amended Agreement);
(ii) Supply (including installation) a substantially
equivalent, non-infringing replacement (such replacement to satisfy the
requirements of this Amended Agreement (including, without limitation, all
agreed specifications applicable to CPE)); or
(iii) Modify the Service, the Work, the CPE, any
Deliverable Item, the Technology or component thereof so that it is
non-infringing, but continues to comply with the requirements of this Amended
Agreement.
Without limiting StarBand's obligations above, if StarBand is
unable to accomplish or perform one of the acts specified in Section
15.5(b)(i), (ii) or (iii) above, then MSN shall have the right to terminate
this Amended Agreement for default, with no further obligations or liability
whatsoever and StarBand having liability for any and all damages suffered by
MSN as a result of StarBand's default under this Section 15.5(b).
15.6 ASSIGNMENT
For MSN's benefit, during the Term and thereafter, StarBand, in
connection with the Service, the Work, the CPE, any Deliverable Item, any
Technology of or provided by
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StarBand, or any component thereof, hereby assigns and conveys to MSN all
rights and interests it has, or that it may from time to time have, to be
indemnified by Gilat, Spacenet or any Affiliate of Gilat under the terms of
the Agreement Relating to Gilat Supply Agreements.
15.7 EXCLUSIONS
Section 15.5 shall not apply to any claim or allegation of
infringement of an Intellectual Property Right of third-party arising from:
(a) the modification of the CPE, any Deliverable Item or
Technology, or any component thereof by a Person other than the party
supplying the same, its Affiliates or their respective Subcontractors if such
infringement would not have occurred but for such modification use; or
(b) the combination by a Person other than StarBand, its
Affiliates or their respective Subcontractors of the CPE, any Deliverable
Item, any Technology or any component thereof with any product or service not
supplied or specified by StarBand or its Subcontractors, if the infringement
would not have occurred but for such combination, unless the Service, the
Work, the CPE, the Deliverable Item or the component thereof would
contributorily infringe.
SECTION 16. GENERAL INDEMNITY
16.1 INDEMNIFIABLE CLAIMS
(a) StarBand hereby indemnifies and agrees to protect,
defend, and hold harmless each MSN Indemnified Person against any and all
Indemnifiable Claims from time to time imposed on (whether during or after the
Term), incurred by or asserted against any MSN Indemnified Person arising out
of or relating to:
(i) failure of Gilat, StarBand or its Affiliates or
their respective Subcontractors to comply with applicable Law, provisions of
any applicable Governmental Approvals or this Amended Agreement or any other
Operative Document;
(ii) the Work, the Service or any injury to or death
of any Person (including employees of StarBand or MSN) or damage to any
property or environment (including property of any MSN Indemnified Person or
any other Person) in connection with or incident to performance of or failure
to perform this Amended Agreement or any other Operative Document;
(iii) any breach of this Amended Agreement or any
other Operative Document by StarBand or any Affiliate thereof, including any
failure by StarBand to provide the Work in accordance with the terms hereof or
any breach by Gilat of the Performance Guarantee; or
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(iv) any possession, handling, transportation,
storage or use of hazardous materials or explosives by StarBand or its
Affiliates.
(b) MSN hereby indemnifies and agrees to protect and defend,
and hold harmless each StarBand Indemnified Person against any and all
indemnifiable claims from time to time imposed on (whether during or after the
Term), incurred by or asserted against any StarBand Indemnified Person arising
out of or relating to:
(i) failure by MSN, its Affiliates or
Subcontractors to comply with applicable Law, provisions of any applicable
Governmental Approval or this Amended Agreement or any other Operative
Document; or
(ii) any breach of this Amended Agreement or any
other Operative Document by MSN or any Affiliate thereof.
16.2 CLAIMS PROCEDURE
Each Party (the "Indemnified Party") will promptly notify the other
Party (the "Indemnifying Party") of the commencement of any action or
proceeding against an MSN Indemnified Person or StarBand Indemnified Person,
as the case may be, in respect of an Indemnifiable Claim for which
indemnification is sought, provided that failure of such Indemnified Party to
provide such notice will not release the Indemnifying Party from any of its
obligations to indemnify hereunder except to the extent such failure
materially impairs the rights of the Indemnifying Party to insurance or
indemnity covering the Indemnifying Party's indemnity obligation hereunder or
otherwise materially increases the Indemnifying Party's indemnity obligation.
An Indemnifying Party will have the right, at its expense, to investigate an
Indemnifiable Claim for which indemnification is sought hereunder and, if such
Indemnifying Party acknowledges full responsibility to indemnify therefore,
will have the right to defend such Indemnifiable Claim, employing counsel
reasonably acceptable to the Indemnified Party, provided that (a) no
Indemnifying Party will be entitled to defend any such Indemnifiable Claim if
the Indemnifiable Claim or Indemnifying Party's defense thereof could give
rise to criminal liability for the Indemnified Party and (b) the Indemnified
Party will be entitled to jointly control its own defense in any proceeding
that has a material adverse effect on the Indemnified Party's business in the
jurisdiction of such proceeding. An Indemnified Party may participate (at its
own expense and with its own counsel) in any proceeding controlled by an
Indemnifying Party, pursuant to the foregoing, and MSN will be entitled to
approve any settlement that adversely affects the Work, the Service, the CPE,
any Deliverable Item, any Technology or any component thereof. Payments
required to be made pursuant to this Section 16.2 will be made directly to
such indemnified person in immediately available funds within thirty (30) days
after written demand upon the Indemnifying Party by such Indemnified Party.
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16.3 ASSIGNMENT
For MSN's benefit, during the Term and thereafter, StarBand, in
connection with the Service, the Work, the CPE, any Deliverable Item, any
Technology or of provided by StarBand, or any component thereof, hereby
assigns and conveys to MSN all rights and interests it has, or that it may
from time to time have, to be indemnified by Gilat, Spacenet or any Affiliate
of Gilat under the terms of the Agreement Relating to the Gilat Supply
Agreements.
SECTION 17. RISK OF LOSS
Subject to the provisions of Section 5.2.5 of this Amended
Agreement, StarBand will bear the risk of loss of, or damage to, the Work
(including the CPE), the StarBand NOC facilities and the contents thereof, and
all other items included in the Work. MSN will at all times bear the risk of
loss of, or damage to, the MSN NOC and the contents thereof.
SECTION 18. TERM
18.1 TERM; RENEWAL
Subject to the other terms and conditions herein, the Term of this
Amended Agreement will commence on the Effective Date and be in effect for
four (4) years. Thereafter, this Amended Agreement will be renewed annually
unless MSN or StarBand gives written notice of termination of this Amended
Agreement to MSN at least one (1) year prior to the date for such renewal.
If the Trial Period is not completed by September 1, 2001, then MSN
may, but is not obligated to, terminate the Amended Agreement. In any such
termination, unless otherwise revoked (by MSN in its sole discretion) within
forty-eight (48) hours after the transmittal thereof, from and after the date
on which MSN will have transmitted to StarBand the notice referred to in this
Section 18.2, MSN will have no further liability to StarBand and MSN's Minimum
Commitment set forth in Section 9 of this Amended Agreement will be null, void
and of no further force or effect. MSN agrees that it shall, in connection
with any termination by it of this Amended Agreement pursuant to this Section
18.2, pay to StarBand any fees accrued hereunder but unpaid as of such date of
termination.
18.3 ONGOING OBLIGATIONS
If this Amended Agreement is otherwise terminated or expires
pursuant to this Section 18, then, at MSN's request, StarBand shall continue
to provide the Service and meet its related obligations hereunder for all MSN
Customers then utilizing the Service until the later of (a) the expiration of
the applicable Service Contract for each such MSN Customer and (b) twelve (12)
months after the date this Amended Agreement would otherwise terminate or
expire. In addition, StarBand will actively cooperate in MSN's efforts to
transition the provision of the Service from StarBand to an MSN-selected
third-party replacement provider of the Service, including providing necessary
data and documentation.
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During the period that StarBand is satisfying its obligations under this
Section 18.3, MSN will continue to pay to StarBand amounts it owes to StarBand
pursuant to Section 6.1 of this Amended Agreement.
18.4 RETURN OF CONFIDENTIAL INFORMATION
At the end of the Term of this Amended Agreement or following any
continued service pursuant to the terms of this Amended Agreement, each Party
will, at the other Party's direction, return or certify destruction of
Confidential Information (as defined in the NDA (defined below)) and other
information and materials of such other Party.
SECTION 19. EVENTS OF DEFAULT; REMEDIES
19.1 EVENTS OF DEFAULT
An Event of Default will occur upon MSN's delivery of written
notice to StarBand after the occurrence of any of the events listed below:
(a) Service performance is such that an "Event of Default"
occurs pursuant to the terms of the Service Level Agreement; or
(b) StarBand fails to perform or comply with Section 10.4,
Section 12 or Section 15.5 of this Amended Agreement; or
(c) any representation or warranty of either Gilat or
StarBand, as the case may be, in this Amended Agreement or under any other
Operative Document proves to have been incorrect in any material respect when
the same was made and materially affects or is reasonably likely to affect
materially MSN's rights or Gilat's or StarBand's ability to perform either of
their respective obligations under this Amended Agreement or under any other
Operative Document or the enforceability of this Amended Agreement or any
Operative Document or MSN's liabilities with respect to this Amended Agreement
or any other Operative Document; provided that if either Gilat or StarBand in
good faith diligently is effecting a cure, then such failure will not
constitute an Event of Default for a period of thirty (30) days following
notice from MSN advising either Gilat or StarBand of such failure; or
(d) either Gilat or StarBand fails to perform or comply with,
or is in default with respect to, any other material obligation of this
Amended Agreement, or any other Operative Document, provided that if Gilat or
StarBand in good faith diligently is effecting a cure, then such failure will
not constitute an Event of Default for a period of thirty (30) days following
notice from MSN advising Gilat or StarBand of such failure; or
(e) an Event of Default occurs under any other Operative
Document; or
(f) either Gilat or StarBand commences a voluntary proceeding
concerning itself under any Insolvency Law; or any involuntary proceeding is
commenced against either Gilat or StarBand under any Insolvency Law and the
petition has not been dismissed within sixty
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29
(60) days after commencement of the proceeding, or a receiver or custodian is
appointed for or takes charge of all or a substantial portion of the property
of either Gilat or StarBand and such custodian or receiver has not been
dismissed or discharged within sixty (60) days; or either Gilat or StarBand
has taken action toward the winding-up, dissolution, or liquidation of either
of their respective businesses; or either Gilat or StarBand has been
adjudicated insolvent or bankrupt or an order for relief or other order
approving a case or proceeding under an Insolvency Law has been entered; or
either Gilat or StarBand has made a general assignment for the benefit of
creditors; or
(g) USB-CPE are not in full commercial production and being
supplied to MSN and its designees in accordance with the terms of this Amended
Agreement on or prior to December 31, 2001.
19.2 MSN REMEDIES
19.2.1 CESSATION OF PAYMENTS
Notwithstanding any other provision herein to the contrary, if an
Event of Default has occurred and is continuing, then for the period of such
continuance, MSN will have no obligation to make any payment to StarBand
hereunder unless and until StarBand fully remedies the Event of Default prior
to MSN giving written notice terminating this Amended Agreement. Subject to
the other terms and conditions of this Amended Agreement, amounts payable to
StarBand will continue to accrue during the continuance of an Event of Default
unless and until written notice is given by MSN terminating this Amended
Agreement. If MSN does not give such termination notice, such amounts will be
paid to StarBand (without interest) after such Event of Default is fully
remedied. If the Event of Default is not fully remedied or MSN gives written
notice terminating this Amended Agreement, then MSN shall be entitled to
offset and credit all StarBand obligations owing against such accrued but
unpaid payments. In addition, MSN may, at its option, exercise any remedy
under this Section 19.2. and will also be entitled to equitable relief,
including injunctive relief and specific performance, to enforce any StarBand
obligations.
19.2.2 SPECIAL REMEDY
Notwithstanding any other provision herein to the contrary, if an
Event of Default under Section 19.1(f) shall have occurred and is continuing,
then MSN may, in lieu of exercising its right to terminate this Amended
Agreement pursuant to Section 19.2.3 hereof, (a) suspend (without penalty) all
further MSN liabilities (without accrual of any MSN liabilities during such
suspension period) until satisfied that the USB-CPE are in full commercial
production and are being supplied to MSN in accordance with this Amended
Agreement or (b) purchase from StarBand (and StarBand will be entitled to
purchase from Gilat) non-USB CPE at the same price as applicable to the
USB-CPE (and all PC Subsidies granted by MSN will be credited against MSN's
Minimum Commitment).
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19.2.3 RIGHT OF TERMINATION
Upon the occurrence of an Event of Default under Section 19.1, MSN
will have the right to terminate this Amended Agreement by written notice to
StarBand of such termination and MSN's Minimum Commitment shall be canceled.
19.2.4 ONGOING OBLIGATIONS AFTER AN EVENT OF DEFAULT
(a) If this Amended Agreement is otherwise terminated
pursuant to Section 19.2.3 hereof, then, at MSN's request, StarBand shall
continue to provide the Service and meet its related obligations hereunder for
all MSN Customers then utilizing the Service (but without any liability for
any fees or other charges of MSN or any MSN Customer) until the later of (a)
the expiration of the applicable Service Contract for each such MSN Customer
and (b) three (3) years after initiation of the Service for such Service
Customer (the "Transition Period"). MSN shall, during the Transition Period,
continue to pay to StarBand amounts it owes to StarBand pursuant to Section
6.1 of this Amended Agreement. Otherwise, MSN shall not have any other
liability under this Amended Agreement with respect to StarBand for other
payments.
(b) In addition to satisfying its obligations under Section
19.2.4(a) hereof, during the Transition Period, StarBand will actively assist
(and will cause its Affiliates (including Gilat) to actively assist), and will
promptly (i) provide (and cause its Affiliates (including Gilat) to provide)
all necessary training, data and documentation and (ii) license (and will
cause its affiliates (including Gilat) to license) technology (royalty-free)
to a third-party replacement provider to permit continued and uninterrupted
Internet access to each such MSN Customer. The obligations of StarBand under
this Section 19.2.4(b) shall be referred to herein as "Migration Assistance".
(c) Upon this Amended Agreement's termination, StarBand will
(i) cease referring to MSN and any of its respective services and products and
(ii) upon MSN's request, do such things as are necessary to disable its direct
and indirect connectivity to MSN. StarBand acknowledges that, in the event it
breaches (or attempts or threatens to breach) its obligation to provide to MSN
and MSN Customers Migration Assistance, MSN will be irreparably harmed in a
manner for which it cannot receive an adequate remedy at law. In such a
circumstance, MSN may proceed to court without first invoking the dispute
resolution procedures of this Amended Agreement and will be entitled to
injunctive relief.
19.2.5 DAMAGES
In addition to any amounts owing under other provisions of this
Amended Agreement, upon occurrence of an Event of Default (and whether or not
MSN exercises its right to terminate this Amended Agreement), StarBand will be
liable, and hereby agrees to pay to MSN within five (5) Business Days after
receiving notice from MSN, for all damages, including, but not limited to,
damages incurred in locating any replacement providers of Internet access for
MSN Customers and installing any equipment in connection therewith,
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and damages or restitution and lost profits associated with the termination of
any Service Contracts incurred by MSN in connection with or due to such
default or other breach. This remedy is not exclusive, and MSN will also be
entitled to any other remedy that MSN may have hereunder, at law or at equity.
19.3 MSN EVENTS OF DEFAULT
An "MSN Event of Default" will occur upon StarBand's delivery to
MSN of written notice after the occurrence of any of the events listed below:
(a) MSN fails to make any payment required hereunder when due
and payable; provided that such failure will not constitute an MSN Event of
Default unless MSN does not cure such failure within thirty (30) days after
notice from StarBand advising MSN of such failure; or
(b) any representation or warranty of MSN in this Amended
Agreement proves to have been incorrect in any material respect when the same
was made and materially affects or is reasonably likely to affect materially
StarBand's rights or MSN's ability to perform its obligations under this
Amended Agreement or the enforceability of this Amended Agreement; provided
that if MSN in good faith diligently is effecting a cure, then such failure
will not constitute an MSN Event of Default for a period of thirty (30) days
following notice from StarBand advising MSN of such failure; or
(c) MSN fails to perform or comply with any other material
obligation of this Amended Agreement, provided that if MSN in good faith
diligently is effecting a cure, then such failure will not constitute an MSN
Event of Default for a period of thirty (30) days following notice from
StarBand (as the case may be) advising MSN of such failure; or
(d) MSN commences a voluntary proceeding concerning itself
under any Insolvency Law; or any involuntary proceeding is commenced against
MSN under any Insolvency Law and the petition has not been dismissed within
sixty (60) days after commencement of the proceeding, or a receiver or
custodian is appointed for or takes charge of all or a substantial portion of
the property of MSN and such custodian or receiver has not been dismissed or
discharged within sixty (60) days; or MSN has taken action toward the
winding-up, dissolution, or liquidation of MSN or its business; or MSN has
been adjudicated insolvent or bankrupt or an order for relief or other order
approving a case or proceeding under an Insolvency Law has been entered; or
MSN has made a general assignment for the benefit of creditors.
19.4 STARBAND REMEDIES
19.4.1 RIGHT OF TERMINATION
Upon the occurrence of an MSN Event of Default under Section 19.3,
StarBand will have the right to terminate this Amended Agreement by written
notice to MSN.
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19.4.2 DAMAGES
Prior to the Full Availability Date, in addition to any amounts
owing under other provisions of this Amended Agreement, upon breach or default
under Section 19.3 (whether or not StarBand exercises its right to terminate
this Amended Agreement), MSN will be liable, and hereby agrees to pay to
StarBand within five (5) Business Days after receiving notice from StarBand,
for all amounts accrued under this Amended Agreement and not yet paid and lost
profits on amounts that would have been payable by MSN hereunder but for such
breach or default. The foregoing notwithstanding, from and after the Full
Availability Date, StarBand's sole remedy under this Section 19.4.2 shall be
the payment to be made to it by MSN in accordance with Section 9 of this
Amended Agreement.
19.5 LIMITATION OF REMEDIES
EXCEPT AS PROVIDED HEREIN, NEITHER PARTY MAY BE HELD LIABLE UNDER
OR IN CONNECTION WITH THIS AMENDED AGREEMENT, WHETHER IN CONTRACT OR IN TORT
OR UNDER ANY OTHER CAUSE OR THEORY OF ACTION, FOR SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT LIMITATION, LOST
PROFIT OR REVENUES.
SECTION 20. RELATIONSHIP OF PARTIES
StarBand, in performing the Work, is acting as an independent
contractor. None of the provisions of this Amended Agreement will be construed
to mean that any Party is appointed or is in any way authorized to act as an
agent of the other Party. This Amended Agreement does not constitute, create,
give effect to, or otherwise recognize a joint venture, partnership or formal
business organization of any kind.
SECTION 21. GENERAL PROVISIONS
21.1 CONFIDENTIALITY
21.1.1 PROPRIETARY INFORMATION
The terms and conditions of the Microsoft Corporation
Non-Disclosure Agreement, attached as Annex D (the "NDA"), govern this Amended
Agreement and all discussions, negotiations and documentation relating to this
Amended Agreement as if fully set forth herein. In the event that any terms of
the NDA are inconsistent with or conflict with this Amended Agreement, then
the terms of this Amended Agreement control.
21.1.2 PUBLIC RELEASE OF INFORMATION
StarBand may not use the name of MSN or any MSN Affiliate (or any
of their respective trademarks or service marks or any portion thereof), in
any advertising, publicity or press release or for any other business purpose
without the prior written consent of MSN unless required by law or permitted
under any license agreement entered into between StarBand and MSN.
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21.2 LANGUAGE
All notices and documents to be delivered under this Amended
Agreement between the Parties will be in the English language. If there is any
inconsistency between the English version of this Amended Agreement or any
other notice or document delivered pursuant hereto and any version in any
other language, the English version controls.
21.3 CARRYING OUT WORK
Notwithstanding any pendency of any dispute, including a dispute
over whether a right of termination has been validly exercised, StarBand will,
and will cause its Affiliates and Subcontractors to, continue to diligently
carry out the Work, provided that MSN continues to pay any other amounts not
disputed. Failure to comply with this requirement will constitute an Event of
Default.
21.4 TELECOMMUNICATIONS PROVISION
Among the Parties, StarBand is the sole provider of
telecommunications services and is responsible for taking any and all actions
necessary to maintain its provider status, including, without limitation,
payment of any and all taxes, fees and assessments imposed upon
telecommunications providers. Solely for purposes of this Amended Agreement,
MSN is not and will not in the future be providing any telecommunication
services.
21.5 TIME OF THE ESSENCE
The Parties agree that time is of the essence in performance of
their respective obligations under this Amended Agreement. Only full
performance will constitute a discharge of their respective obligations.
21.6 ASSIGNMENT
This Amended Agreement will be binding on and inure to the benefit
of the Parties and their successors and assigns. Any assignment or delegation
of this Amended Agreement will not relieve the assigning Party of any of its
obligations without the prior written consent of the other Parties. During the
term of this Amended Agreement, neither party may directly or indirectly
assign or transfer this Amended Agreement or any rights hereunder to any
Person without the prior written consent of other party (such consent not to
be unreasonably withheld).
21.7 ENTIRE AGREEMENT
This Amended Agreement, including the annexes and exhibits related
hereto and the SLA, NOP, and CPE Plans contains the entire agreement between
the Parties regarding the subject matter hereof and supersedes all
communications, negotiations and other agreements, either written or oral,
relating hereto made prior to the Effective Date.
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21.8 NO LICENSE
Except as otherwise set forth herein, no license, express or
otherwise, is granted by any Party to any Person as a result of the
transactions contemplated by this Amended Agreement.
21.9 AMENDMENTS
This Amended Agreement may not be modified except by a written
agreement signed by both Parties.
21.10 SEVERABILITY
If any one or more of the provisions of this Amended Agreement is
held for any reason to be invalid or unenforceable, the remaining provisions
of this Amended Agreement will be unimpaired and the invalid or unenforceable
provision will be replaced by a mutually acceptable provision which, being
valid and enforceable, comes closest to the intention of the Parties
underlying the invalid or unenforceable provision.
21.11 GOVERNING LAW; CONSTRUCTION
(a) THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS
AMENDED AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING EFFECT TO ITS CONFLICTS-OF-LAWS PRINCIPLES (OTHER THAN SECTIONS
5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).
(b) This Amended Agreement has been negotiated by the Parties
and their respective counsel and will be interpreted fairly in accordance with
its terms and without any strict construction in favor of or against either
Party. The section headings used in this Amended Agreement are intended for
convenience only and will not be deemed to affect in any manner the meaning or
intent of this Amended Agreement or any provision hereof.
21.12 SUBMISSION TO JURISDICTION
For the benefit of MSN, StarBand agrees that the state or federal
courts located in or of New York City, New York are to have jurisdiction to
settle any disputes in connection with this Amended Agreement and submit to
the jurisdiction of such courts in connection with this Amended Agreement. The
Parties further agree that a final judgment in any action or proceeding
arising out of or relating to this Amended Agreement will be conclusive and
may be enforced in any other jurisdiction within or outside the United States
of America by suit on the judgment, a certified or exemplified copy of which
will be conclusive evidence of the fact and the amount of the indebtedness or
liability therein described, or in any other manner provided by Law. Each
Party hereby irrevocably waives, to the fullest extent permitted by Law, any
objection which it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Amended
Agreement brought in any state or federal court in New York City, New York,
and hereby further irrevocably
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35
waives any claim that any such suit, action or proceeding brought in any state
or federal court in or of New York City, New York has been brought in an
inconvenient forum. Nothing in this Section 21.12 limits the right of MSN to
bring proceedings against StarBand in connection with this Amended Agreement
in any other court of competent jurisdiction or, concurrently, in more than
one jurisdiction.
THE PARTIES HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
TO WHICH THEY ARE PARTIES INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
ARISING OUT OF OR RELATING TO THIS AMENDED AGREEMENT.
21.13 PROCESS AGENT; SERVICE OF PROCESS
StarBand, at its expense, will maintain the process agent set forth
below as its agent for service of process in the State of New York during the
Term and six (6) months thereafter. StarBand hereby irrevocably designates,
appoints and empowers CT Corporation System, with its offices located at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its authorized agent
to receive on its behalf and on behalf of its property, service of copies of
the summons and complaint and any other process which may be served in any
action or proceeding arising out of or relating to this Amended Agreement.
Such service may be made by mailing or delivering a copy of such process in
care of the appropriate process agent set forth above, and StarBand hereby
irrevocably authorizes and directs its designated process agent to accept such
service on its behalf. StarBand further agrees that failure by a process agent
appointed in accordance with the foregoing terms to notify it of the process
will not invalidate the proceeding concerned. Notwithstanding the foregoing,
nothing herein will affect the rights of either Party to serve process in any
other manner permitted by Law.
21.14 NOTICES
(a) All notices, requests, demands, and determinations under
this Amended Agreement will be in writing, may be delivered by hand, express
courier, confirmed facsimile or mail, and will be deemed duly given when
received at the following addresses:
If to MSN, at:
The Microsoft Network L.L.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Director, MSN Internet Access
With a copy to: Microsoft Law and Corporate
Affairs Department
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
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If to StarBand, at:
StarBand Communications, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
With a copy to: The Office of the General Counsel
(b) A Party may, from time to time, change its address or
designee for notification purposes by giving the other Party prior written
notice of the new address or designee and the date upon which it will be
effective.
21.15 SURVIVAL
Provided that the Effective Date has occurred, the following
Sections will, except to the extent expressly limited by their terms, survive
any expiration or termination of this Amended Agreement: Section 1 (General
Definitions), Section 7 (Taxes), Section 10 (Marketing and MSN Service
Customer Relationships), Section 13.2 (Authorization), Section 14.1
(Compliance with Laws), Section 15 (Intellectual Property Rights), Section 16
(General Indemnity), Section 17 (Risk of Loss), Section 18 (Term), Section 19
(Events of Default; Remedies), Section 20 (Relationship of Parties) and
Section 21 (General Provisions). Any other provisions of this Amended
Agreement that can be reasonably construed to survive the expiration or
termination of this Amended Agreement for any reason will survive such
expiration or termination of this Amended Agreement. Each surviving obligation
hereunder will survive the termination of this Amended Agreement to the extent
necessary to ensure the enforcement of such obligation.
21.16 COUNTERPARTS
This Amended Agreement may be executed in counterparts, which taken
together constitute one single contract between the Parties.
[The remainder of this page intentionally left blank.]
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IN WITNESS WHEREOF this Amended Agreement has been executed on
behalf of each of the Parties by persons authorized in that behalf at Redmond,
Washington.
THE MICROSOFT NETWORK L.L.C.,
By: /s/ ▇▇▇ KUMMART
-----------------------------
Its: Managing Member
By: /s/ ▇▇▇ KUMMART
-----------------------------
Name: ▇▇▇ Kummart
---------------------------
Title: VP
--------------------------
STARBAND COMMUNICATIONS, INC.
By: /s/ ZUR ▇▇▇▇▇▇▇
-----------------------------
Name: Zur ▇▇▇▇▇▇▇
---------------------------
Title: Co-Chairman and CEO
--------------------------
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ANNEX A
DEFINITIONS
"Acceptance Date" is defined in Section 3.1.1(h) of the Amended
Agreement
"Additional Revenue Services Agreement" means that certain
Additional Revenue Services Agreement, of even date herewith, by and between
MSN and StarBand, as the same may from time to time be amended, modified or
supplemented.
"Affiliate" means, with respect to any Person, any other Person
Controlling, Controlled by, or under common Control with such entity.
"Agreement" means the Broadband Access Services Supply Agreement,
dated as of February 15, 2000, by and between MSN and Gilat-to-Home, Inc., as
it may from time to time be amended, modified or supplemented.
"Agreement Relating to Gilat Supply Agreements" is set forth in
Annex F attached hereto.
"Amended Agreement" means this Amended and Restated Broadband
Access Services Supply Agreement, dates as of October 20, 2000, by and between
MSN and StarBand, as it may from time to time be amended, modified or
supplemented.
"Approved Internet Provider" means a MSN-approved backbone Internet
provider and an MSN-approved telecommunications provider for the connection
between the StarBand NOC and the MSN NOC.
"Associates" means, with respect to any Person and its successors
and assigns, the directors, officers, employees, and agents of each of the
foregoing.
"Authorized Delivery Location" is defined in Section 5.2.5(a) of
the Amended Agreement.
"Background Intellectual Property" is defined in Section 15.2(a) of
the Amended Agreement.
"Business Day" means any calendar day other than Saturday, Sunday
or a day on which commercial banks in Seattle, Washington or New York, New
York are authorized or required to be closed.
"Confidential Information" is defined in Section 1(a) of the NDA
which is attached as Annex D to this Amended Agreement.
"Confidentiality Agreement" is defined in Section 14.4 of the
Amended Agreement.
39
"Consumer Sales Channel" means the sale of the Service and/or
non-USB-CPE or USB-CPE through retail outlets.
"Control" and its derivatives (such as "Controlled" and
"Controlling") mean, with respect to an entity, the legal, beneficial, or
equitable ownership, directly or indirectly, of fifty percent (50%) or more of
the capital stock (or other ownership interest if not a corporation) of such
entity ordinarily having voting rights or the power to direct the management
policies of such entity, whether through the ownership of voting stock, by
contract, or otherwise.
"CPE" means customer premises equipment, including all equipment
and associated software necessary for an MSN Customer to use the Service.
"CPE Minimum Production Capacity" is defined in Section 5.2.6 of
the Agreement.
"CPE Plan" means a plan to be agreed by the Parties pursuant to
Section 3.1.1(c) of the Amended Agreement, which shall include (without
limitation) CPE specifications, procedures for CPE installation, repair and
replacement, and a development plan for USB Boxes and which is attached to
this Amendment Agreement as Annex F.
"Delivery" is defined in Section 3.1.1(f) of the Amended Agreement.
"Dollars" means United States Dollars.
"Effective Date" means October 20, 2000.
"Event of Default" is defined in Section 19.1 of the Amended
Agreement.
"FCC" means Federal Communications Commission.
"Foreground Intellectual Property" is defined in Section 15.3(a) of
the Agreement.
"Full Availability Date" is defined in Section 3.1.1 of the Amended
Agreement.
"Gilat" means Gilat Satellite Networks, Ltd., an Israeli company.
"Gilat-to-Home" means Gilat-to-Home, Inc., a Delaware Corporation,
the former name of StarBand Communications, Inc.
"Governmental Approval" means all permits, authorizations,
consents, approvals, licenses, consent certificates, rulings, certifications,
orders, waivers, exemptions of, or filings or registrations with, any
Governmental Authority.
"Governmental Authority" means any national, regional, or foreign
government; international authority (including, in each case, any central bank
or fiscal, tax, or monetary authority); the government of any prefecture,
state, province, county, municipality, or other political subdivision thereof;
any governmental body, agency, authority, division, department, governmental
authority, board, or commission; or any instrumentality, officer, or official
of
40
any of the foregoing; and including any court, tribunal, or committee
exercising any executive, legislative, judicial, regulatory, or administrative
functions of government.
"Guarantee" means that certain Performance Guarantee Agreement, of
February 12, 2000, executed by Gilat in favor of MSN, which has been
terminated by the Termination Agreement, Annex E to this Amended Agreement.
"Indemnifiable Claims" means all actual or threatened claims,
(including claims of Subcontractors), suits, actions, or causes of action,
liabilities, damages, losses, judgments, awards, penalties and fines, and
whether or not for direct, special, indirect, incidental, exemplary, punitive
or consequential damages, or lost profit or otherwise, including those for
death, personal injury, property damage, economic loss or any other loss; any
and all royalty payments; and any and all costs and expenses related to any of
the foregoing (including reasonable legal fees and disbursements, and costs of
investigation, experts, litigation, settlement, and interest).
"Indemnified Party" is defined in Section 16.2 of the Agreement.
"Indemnifying Party" is defined in Section 16.2 of the Agreement.
"Insolvency Law" means any bankruptcy, insolvency, reorganization,
adjustment of debt, relief of debtors, or similar law of United States or
Israel.
"Intellectual Property Rights" means patents, copyrights, mask work
rights, database rights, trade secret and other proprietary information
rights, contract rights, and other intellectual property and intangible rights
(whether statutory, common law, administrative or otherwise), including any
registrations and applications with respect to any of the foregoing, except
that, unless otherwise provided herein, "Intellectual Property Rights"
excludes trademarks and other rights with respect to indicia of source or
origin.
"ISP" means Internet service provider.
"Law" means any statute, decree, constitution, regulation,
decision, common law, finding, order, rule, code, ordinance, judgment, or
directive of any Governmental Authority, or any treaty, convention, pact,
compact, or other agreement to which any Governmental Authority is a signatory
or party, and includes any judicial or administrative interpretation or
application of any of the foregoing, including any guideline, guidance,
directive, interpretation, rule, or regulation of any Person, whether or not
having the force of law (but, if not having the force of law, with respect to
which compliance is customary), and is a reference to any of the foregoing as
amended, substituted, reissued, or reenacted.
"Microsoft" means Microsoft Corporation, a Washington corporation.
"Microsoft Holdings" means Microsoft G-Holdings, Inc., a Nevada
corporation.
41
"Migration Assistance" is defined in Section 19.2.4(b) of the
Agreement. Section 19.2.4(b) of the Amended Agreement.
"Minimum Purchase Commitment" or "Minimum Commitment" is defined in
Section 9 of the Amended Agreement.
"MSN" means The Microsoft Network L.L.C., a Delaware limited
liability company.
"MSN Customer" means any users permitted by MSN or Microsoft or any
of their Affiliates or respective associates and partners to use the Service,
including, without limitation, in connection with WebTV or any other
Microsoft-related business, as well as with OEM or similar Microsoft-related
customers or agents.
"MSN Customer Installation Contract" is defined in Section5.2.11 of
the Agreement.
"MSN Employee Customer" means those persons to whom MSN has provided
non USB-CPE or USB-CPE outside the Consumer Sales Channel.
"MSN Event of Default" is defined in Section 19.3 of the Agreement.
"MSN Indemnified Person" means each of MSN, Microsoft, their
Affiliates, and the successors, assigns and Associates of each of the foregoing.
"MSN NOC" means the network operations center operated by MSN.
"MSN Pilot Satellite Testing Program" means the MSN Program to test
non-USB-CPE which is limited to no more than 500 MSN Employee Customers.
"MSN Service" means the Internet access service marketed by MSN to
the MSN Customers.
"MSN Trademarks" is defined in Section 4.2 of Annex B-1 to the
Agreement.
"NDA" means The Microsoft Corporation Non-Disclosure Agreement, of
even date herewith, entered into by and between MSN and StarBand which is
attached as Annex D to this Amended Agreement.
"Network Operations Plan" or "NOP" means the plan developed by the
Parties pursuant to Section 3.1.1(c)(i) of the Amended Agreement, which is
attached as Annex G.
"Non-obligated Party" is defined in Section 7 of the Amended
Agreement.
"Notice of Availability" is defined in Section 3.1.1(g) of this
Amended Agreement.
"Obligated Party" is defined in Section 7 of the Agreement.
"One-Time Installation Fee" means the fee to be paid pursuant to
Section 10.3(a) of the Amended Agreement.
42
"OEM" means Original Equipment Manufacturer.
"Operative Documents" means this Amended Agreement (including all
exhibits, annexes and schedules attached thereto), the Termination Agreements,
the Trademark Licenses between MSN and StarBand, the Equity Investment
Documents, the Telecommunications Services Agreement, the Master Supply
Agreement between Gilat and StarBand dated September 29, 2000, and the
Additional Revenue Services Agreement and any other document which MSN and
StarBand shall from time to time agree is an "Operative Document."
"Out-of-Warranty Fees" means the fees to be paid pursuant to Section
10.3(b) of the Amended Agreement.
"Parties" means MSN and StarBand.
"Party" means MSN or StarBand, as appropriate.
"PC" or "PCs" means, respectively, a personal computer or personal
computers.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
trustee, unincorporated organization, authority, other body, or Governmental
Authority.
"Primary USB-CPE" is defined in Section 3.1.1(d) of the Amended
Agreement
"Production Forecast" is defined in Section 5.2.7 of the Amended
Agreement.
"Program Review" is defined in Section 3.1.2(c) of the Amended
Agreement.
"Purchase Order" is defined in Section 5.2.2(a) of the Amended
Agreement.
""Service" means two-way, broadband ingress and egress via satellite
to and from MSN and the Internet for use by MSN Customers in the Service
Territories, all in accordance with this Amended Agreement. The Service will
include supply, installation, maintenance and repair of CPE, service activation
and termination, network services, space segment (including satellite capacity,
communication and control), help desk support and such other items, products,
services and other items that are reasonably necessary (and generally within the
scope of the products, services and other items that are to be provided by
StarBand as contemplated in the Amended Agreement) for the provision of the
Service and for an MSN Customer to utilize the Service.
"Service Access" means an MSN Customer has had CPE fully installed on
its premises, such MSN Customer enjoys access to the Service and the Service
performs in accordance with the specifications set forth in this Amended
Agreement, the Service Level Agreement and the other Operative Documents.
43
"Service Contract" means any contract for use of the Service entered
into with a Customer.
"Service Level Agreement" means the Service Level Agreement attached
as Annex C.
"Service Territories" means the United States of America, Canada,
Mexico and additional territories in which the Service may from time to time be
offered in accordance with Section11 of this Amended Agreement.
"Shortfall" is defined in Section 9 of the Amended Agreement.
"Spacenet" means Spacenet Inc., a Delaware corporation and
wholly-owned subsidiary of Gilat.
"Statutory Intellectual Property" is defined in Section 15.3(b) of
the Agreement.
"StarBand" means StarBand Communications, Inc.., a Delaware
corporation formerly known as Newco.
"StarBand Network" is the network developed by StarBand for the
purpose of making the Service available to Customers in accordance with the
Network Operations Plan.
"StarBand NOC" or "StarBand Network Operation Center" is defined in
Section 3.1.1(b) of the Amended Agreement and is initially being operated on
StarBand's behalf by Spacenet pursuant to the Telecommunications Services
Agreement."Subcontract" means an agreement entered into by StarBand with a
Subcontractor.
"Subcontractor" means a Person that has been awarded or has otherwise
made or entered into a Subcontract with StarBand or another Subcontractor at any
tier, including subcontractors, other third parties, suppliers, manufacturers,
fabricators, distributors, materialmen, and vendors and representatives, agents,
successors, and assigns of any of the foregoing.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.
""Taxes" means any net income, gross income, gross receipts, windfall
profit, severance, property, production, sales, use, license, exercise,
franchise, employment, payroll, withholding, alternative or add-on minimum, ad
valorem, value added, transfer, stamp, or environmental tax, or any other tax,
tariff, custom, duty, levy, impost, governmental fee or
44
other like assessment or charge of any kind whatsoever, together with any
interest or penalty, addition to tax or additional amount imposed by any
governmental authority in any jurisdiction.
"Technology" means ideas, concepts, techniques, know-how, inventions,
discoveries, methods, processes, creations, works, documentation, drawings,
designs, specifications, schematics, descriptions, development tools, test
suites, diagnostic materials, samples, software (including firmware) (in source
code, object code or any other form) and other copyrightable or patentable
subject matter, prototypes and samples of hardware, data, methods, processes,
and other materials and information in any form (whether written, electronic,
graphic or otherwise).
"Telecommunications Services Agreement" is described in Annex K of
this Amended Agreement.
"Term" is defined in Section18.1 of the Amended Agreement.
"Test Units" is defined in Section 3.1.1(f) of the Amended Agreement.
"Tier 1 problems" are defined in Section 6.4 of Annex B-1 of the
Agreement.
"Tier 1 Support" is defined
"Tier 2 problems" are defined in Section 6.4 of Annex B-1 of the
Agreement.
"Trademark License" is described in Section 15.1 of the Amended
Agreement.
"Transfer Tax" is defined in Section 7 of the Amended Agreement.
"Transition Period" is defined in Section 19.2.4(a) of the Amended
Agreement.
"Trial Period" is defined in Section 3.1.1 of the Amended Agreement.
"Trial Period Purchase Order" is defined in Section 5.1 of the
Amended Agreement.
"USB" means universal serial bus, or, if mutually agreed by the
Parties, other universal bus, such as ethernet.
"USB-based CPE Specifications" means the MSN-approved specifications
regarding USB-based CPE adopted by the Parties in accordance with Section
3.1.3(e) of the Agreement.
"USB-CPE" is defined in Section 3.1.1(c)(iii) of the Amended
Agreement.
"USB-CPE Installation Contract"
45
"USB-CPE Minimum Production Capacity" is defined in Section 5.26 of
the Amended Agreement.
"USB Box" means an MSN-approved set top box connecting to a
Customer's PC through the USB port and otherwise satisfying the other
requirements of this Amended Agreement.
"Work" means everything necessary to fulfill StarBand's obligations
under this Agreement, including all items, products and services (whether or not
expressly described in this Amended Agreement) necessary to provide broadband
access to MSN and the Internet for use by the MSN Customers. The Work does not
include billing services and Tier One support to be provided by MSN for MSN
Customers.
46
ANNEX B-1
STATEMENT OF WORK
1. Section 1 is intentionally left blank.
2. BROADBAND ACCESS FOR SERVICE CUSTOMERS
In accordance with this Agreement, StarBand will provide the Work and the
Service, including broadband ingress and egress via satellite to and from MSN
and the Internet for use by MSN Customers in the Service Territories. The Work
will include (a) supplying all CPE, satellite capacity, satellite network
equipment, and other items necessary for the Work and for the provision by
StarBand of the Service, (b) all installation, operations, help desk and other
services listed in this Statement of Work and (c) such other items, products,
services and other items that are reasonably necessary (and generally within the
scope of the products, services and other items that are to be provided by
StarBand as contemplated by this Agreement) for the Work or for the provision of
the Service.
3. NETWORK
3.1 NETWORK ARCHITECTURE
StarBand will define, operate and maintain, subject in each case to MSN
approval, a network architecture as to be described in the Network Operations
Plan and Network Performance Plan, and including the following:
(a) the StarBand NOC, consisting of one or more hub RF equipment chains
and associated base-band equipment, terrestrial interconnect and network
operations facilities. The location of the StarBand NOC facility may be
co-located with current MSN operations or at a separate location, all as to be
mutually determined by the Parties. In either case, network operations, as such
pertains to the Service, will be the sole responsibility of StarBand personnel.
Auxiliary network monitoring capability will be extended to MSN operation
personnel as requested by MSN;
(b) 24x7 monitoring by StarBand of all elements of the Service;
(c) Network operations statistics to be as defined by the Parties;
(d) direct connection Internet access from the MSN Customer's PC via the
StarBand NOC to the ingress point of an MSN-approved backbone network provider
for MSN Customer queries that do not terminate on MSN properties or services.
The throughput/grade of service will be agreed in the Network Performance Plan,
and will be based on the traffic model assumption that 80% of traffic does not
go to MSN, but goes directly to the Internet;
47
(e) direct connection from the MSN Customer's PC via the StarBand NOC to
the ingress point of the MSN access network. The throughput/grade of service
will be agreed in the Network Performance Plan; and
(f) direct connection between the StarBand NOC and the SOC.
The foregoing operations and maintenance obligations will be StarBand's
responsibility.
3.2 NETWORK FEATURES
The Network must include the ability to meter and "throttle" usage, an
authentication mechanism, PPTP and other features to be agreed by the Parties in
the Network Operations Plan.
3.3 NETWORK MAINTENANCE
From and after the Effective Date, StarBand will repair and maintain all
aspects of the Network and the other elements of the Work, including the
StarBand NOC facilities, all in accordance with the best industry practices as
employed by leading operators in the telecommunication industry.
3.4 NETWORK PERFORMANCE
The Service Level Agreement will include StarBand-warranted performance for
the Service. The warranted performance will be based upon the following
assumptions for peak loading:
Percentage Service Customers on-line at peak: [*]%
Loading/Outbound (satellite to PC): [*]% (% of session actually receiving)
Loading/Inbound (PC to satellite): [*]% (% of session actually transmitting)
StarBand will warrant minimum Customer performance of 150Kbps at "peak loading,"
256Kbps at "adjacent to peak," with loading conditions at all other times as to
be specified, and 1.0 Mbps burst rates under conditions to be specified in the
Service Level Agreement. For purposes of this Agreement, "peak loading" means
any period of time agreed by the Parties (not to exceed more than four (4)
consecutive hours during any twenty-four (24) hour period) and "adjacent to
peak" means the two (2) hours occurring immediately prior to and after the peak
loading time.
3.5 MSN CUSTOMER PRIORITY
StarBand will not permit the warranted MSN Customer performance to be
adversely affected by satellite capacity usage of other users of its network or
the satellite transponder (regardless of any prior sale of peak or non-peak
satellite capacity usage, all of such sales to
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
48
be structured consistent with the first priority rights of the MSN Customers).
No such arrangements will be permitted without the prior approval of MSN, and in
the event that performance falls below the warranted level, StarBand will
terminate any such arrangements immediately upon MSN's request.
4. CPE
4.1 CPE DESIGN AND PRODUCTION
The CPE will include all items necessary for MSN Customers to utilize the
Service, including (without limitation) the following:
(a) an indoor user interface configuration, consisting of either (i) a
complete PC with all necessary communications equipment (including a two-card
set consisting of a DVB receiver card and a proprietary transmitter card) being
fully integrated and prebundled; (ii) a self-contained "set-top box" connecting
to an existing PC via USB or (iii) other consumer-friendly implementation to be
agreed by the Parties. The CPE Plan will include a development plan for prompt
development of PC termination equipment that can be easily installed and
operated by consumers;
(b) outdoor electronics, including antenna (in reasonable consumer form
factor, not to exceed (a) 24"x36" in at least eighty percent (80%) of
installations and (b) 1.2 meters in the case of all other installations
(StarBand acknowledging that any incremental costs associated with installing
the larger antenna shall be for its account), receiver and transmitter; and
(c) miscellaneous cables, connectors and other items necessary to
complete the installation.
Approval of the USB-based CPE Specifications shall be in accordance with
Section 3.1.3(d) of the Agreement. CPE production, distribution and installation
shall be effected in accordance with Sections 3 and 5 of the Agreement, this
Section 4 of the Statement of Work and the CPE Plan.
4.2 CPE TRADEMARKS
In connection with the foregoing, MSN will provide to StarBand a document
(as modified from time to time by MSN, the "CPE Trademark Guidelines")
describing the use, arrangement, type, relative and other size, and relative and
other location of the MSN logo (the "MSN Trademarks"), that are to appear on the
CPE, on packaging and in documentation for the CPE, and in marketing, public
relations, advertising, and promotional materials related to the CPE. All uses
of the MSN Trademarks shall be in accordance with the MSN trademark license
below and the CPE Trademark Guidelines. If and to the extent specified in the
CPE Trademark Guidelines, all CPE, all documentation and packaging for the CPE,
and all marketing, public relations, advertising and promotional materials
related to the CPE, shall display the MSN Trademarks as specified in such CPE
Trademark Guidelines. Any
49
appearance of StarBand trademarks with respect to the CPE or marketing, public
relations, advertising, and promotional materials related to the CPE shall be in
accordance with the CPE Trademark Guidelines.
Subject to the terms and conditions of this Agreement and the Microsoft IP
License Agreement, Microsoft hereby grants to StarBand a limited, non-exclusive,
non-transferable, personal license during the Term to reproduce and use the MSN
Trademarks solely on CPE, on packaging and in documentation for such CPE, and in
marketing, public relations, advertising and promotional materials for such CPE.
All such usage will be in accordance with the CPE Trademark Guidelines set forth
on Attachment 1 to this Annex B-1 and as from time to time provided by Microsoft
or MSN to StarBand and the other requirements of this Agreement. StarBand shall
not have any right, title or interest in or to the MSN Trademarks, other than
the license rights expressly granted herein. Upon expiration or termination of
the granted rights, StarBand shall cease all use of the MSN Trademark. From time
to time, StarBand shall take such steps as may reasonably be requested by
Microsoft or MSN to evidence Microsoft's ownership and license to StarBand of
the MSN Trademark, including execution of registered user agreements if required
by applicable law. Microsoft and MSN may from time to time modify the CPE
Trademark Guidelines, and StarBand will comply with such CPE Trademark
Guidelines as modified. In accordance with the CPE Trademark Guidelines,
StarBand will submit to MSN and otherwise allow Microsoft and MSN access to
samples of CPE, associated documentation, packaging, and marketing, public
relations, advertising and promotional materials to confirm compliance with the
CPE Trademark Guidelines, the agreed product specifications and the other
requirements of this Agreement. StarBand may use the MSN Trademarks solely on,
or in connection with, CPE that meet all standards of quality and performance
required by this Agreement, including, but not limited to, the Service Level
Agreement. StarBand will promptly remedy (solely at its cost and expense) any
deficiencies identified by Microsoft or MSN. MSN testing, verification and other
preparations will not constitute representations or warranties by Microsoft or
MSN or give rise to any rights of reliance or otherwise for the benefit of
StarBand or any other Person.
StarBand acknowledges that Microsoft is and will remain the owner of all
right, title and interest in and to the MSN Trademarks and all goodwill (whether
now existing or hereafter created) relating to the MSN Trademarks. StarBand
further acknowledges that all use of the MSN Trademark by StarBand shall be
deemed to be use by Microsoft, and all goodwill arising therefrom will inure to
the benefit of Microsoft. Microsoft shall have the exclusive right to, and in
its sole discretion may, commence, prosecute or defend, and control any action
concerning the MSN Trademarks. StarBand will not during or after the Term of
this Agreement assert or claim any interest in the MSN Trademarks, or challenge
or do anything that may adversely affect the validity, enforceability, or
Microsoft's ownership of the MSN Trademark (including, but not limited to, any
act, or assistance to any act, that may infringe or lead to the infringement of
the MSN Trademarks). StarBand shall not use, reproduce, or seek registration of
any domain name, word, design, or other ▇▇▇▇ containing or confusingly similar
to the MSN Trademarks. StarBand shall not reproduce or use (or authorize the
reproduction or use of) the MSN Trademarks in any manner whatsoever other than
as expressly authorized by this Agreement and described in the CPE Trademark
50
Guidelines. To the extent that StarBand may acquire any right, title, or
interest in or to any MSN Trademark or related goodwill, StarBand shall convey
such right, title, or interest to Microsoft.
StarBand may not directly or indirectly assign or otherwise transfer this
trademark license. StarBand's license to use the MSN Trademarks in connection
with CPE shall not extend to the merchandising or sale of related or promotional
products under the MSN Trademark.
NEITHER MICROSOFT NOR MSN MAKE ANY WARRANTIES REGARDING THE MSN TRADEMARKS,
INCLUDING VALIDITY OF MICROSOFT'S RIGHTS WITH RESPECT THERETO IN ANY COUNTRY,
AND EACH OF THEM HEREBY DISCLAIMS ALL WARRANTIES THAT MIGHT OTHERWISE BY IMPLIED
BY LAW, INCLUDING WARRANTIES AGAINST VIOLATION OR INFRINGEMENT OF TRADEMARK,
LITERARY, OR PERSONAL RIGHTS, OR OTHER PROPRIETARY RIGHTS. IN NO EVENT SHALL
MICROSOFT OR MSN BE LIABLE FOR STARBAND'S, OR ANY THIRD PARTY'S CONSEQUENTIAL,
INDIRECT, INCIDENTAL, PUNITIVE, OR SPECIAL DAMAGES (INCLUDING LOST PROFITS)
ARISING FROM OR RELATED TO STARBAND'S USE OF THE MSN TRADEMARKS, REGARDLESS OF
LEGAL THEORY OR WHETHER MICROSOFT OR MSN HAS BEEN ADVISED IN ADVANCE OF THE
POSSIBILITY OF SUCH DAMAGES.
The Parties agree that a material breach of this trademark license is
likely to cause irreparable harm such that, upon an adequate showing of such
breach and without further proof of irreparable harm other than this
acknowledgement, the non-breaching Party shall be entitled to preliminary
injunctive relief.
4.3 CPE TITLE TRANSFER; INSTALLATION
The terms and conditions set forth in Sections 5.1 and 5.2.5 of the
Agreement shall govern CPE title transfer and the allocation between the Parties
of all risks of loss related to the production, shipment, storage and
installation of CPE. At the request of any Customer, StarBand will provide, or
cause to be provided (through a Subcontractor), installation of all CPE. Such
installation will include certification procedures that such CPE is installed
properly and functions in accordance with the requirements of this Agreement.
Ninety percent (90%) of all CPE will be installed no later than fifteen (15)
days after Customer's request for installation. MSN will bear no liability for
collecting any installation charges.
4.4 CPE SELF-INSTALLATION KITS
StarBand will make available for resale CPE self-installation
kits for a price not to exceed [*]. StarBand, in consultation with MSN, will
develop distribution channels for such kits, by entering into resale
arrangements (such arrangements to include StarBand's agreement to provide such
retailers with quantities of such kits and at such times as MSN or MSN's
designee may from time to time request) with retailers approved by MSN. The kits
will contain all items necessary for consumer installation of the CPE,
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
51
including detailed instructions and free telephone access to a StarBand-operated
24x7 installation help desk. The kits will be developed in consultation with
MSN.
In order to fulfill demand from MSN, StarBand will be obligated to supply
self-installation kits for MSN Customers in the maximum quantities (at a price
not to exceed [*]) up to [*] of CPE purchased by MSN.
StarBand will provide a warranty of self-installation kits for three
hundred sixty-five (365) days after CPE installation. Such StarBand warranty
will be freely transferable to MSN, its designees, and MSN Customers.
4.5 CPE DOCUMENTATION AND SUPPORT MATERIALS
StarBand will provide with each unit of CPE, at no additional charge, a
complete set of documentation relating to the installation, operation, and
maintenance thereof as is customarily supplied to customers of comparable
equipment. All such documentation will be subject to MSN approval. All updates
of such documentation will be available to Customers for downloading from the
Internet in accordance with the CPE Plan.
4.6 CPE WARRANTY
StarBand will supply to MSN a CPE warranty freely transferable to each MSN
Customer. Such StarBand warranty shall warrant that CPE will be free from
defects in material and workmanship and will operate in accordance with design
and performance standards set forth in the CPE Plan. In addition, StarBand will,
or will cause each installer of CPE to, warrant to each MSN Customer that CPE
installation has been performed in accordance with the standards specified in
the CPE Plan.
For ninety (90) days after CPE installation, CPE will be subject to full
StarBand warranty, including coverage regarding installation, labor and parts.
Thereafter, for an additional one (1)-, two (2)- or three (3)-year period (at
the option of an MSN Customer and at the respective prices set forth on
Attachment 2 to this Annex B-1), there shall be a full StarBand warranty on CPE
hardware, software, installation and factory labor (including parts). StarBand
shall also offer to MSN Customers an optional one (1)-, two (2)- or three
(3)-year full StarBand warranty (at the respective prices set forth on
Attachment 2 to this Annex B-1) on CPE hardware, software and installation
(including on-site service and parts). The StarBand warranty will be freely
transferable.
StarBand will provide out-of-warranty services for at least six (6) years
from the date of the last installation of CPE for an MSN Customer. The charges
applicable to such out-of-warranty services are set forth on Attachment 2 to
this Annex B-1 (as from time to time adjusted upon the agreement of the
Parties). For MSN Customers, MSN will bear no liability for collecting any
out-of-warranty charges.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
52
4.7 CPE MAINTENANCE
StarBand agrees to provide out-of-warranty maintenance support for each
model or version of the CPE for a period of six (6) years from the date of the
last installation of such model or version for an MSN Customer. StarBand also
agrees to maintain a supply of sufficient spare parts, diagnostic tools and test
equipment during such period.
4.8 TECHNICAL SUPPORT AND FAULT ISOLATION
During the Term, StarBand will provide a 24x7 technical assistance center
for use by MSN, and such technical assistance center shall provide assistance
necessary to ensure that the satellite network (including the StarBand NOC and
CPE being utilized by MSN Customers) performs in accordance with the
specifications set forth in the Service Level Agreement and the CPE Plan.
StarBand, at no additional charge, will provide fault isolation diagnostic
services as needed by MSN.
4.9 GENERAL STANDARDS
StarBand will ensure that all CPE installation, warranty repair or
replacement and maintenance is conducted in accordance with the then current and
best industry practices as generally employed by leading operators in the
telecommunication industry and as specifically employed by leading operators in
the satellite industry.
4.10 INFORMATION
At MSN's request, StarBand will provide to MSN detailed information and
summaries regarding the design, development, testing, certification, production,
distribution, installation, repair, and maintenance of the CPE, including, but
not limited to, all such information as is reasonably necessary to enable MSN to
provide technical and operational Tier One support to MSN Customers. StarBand
will bear all costs associated with the provision by it to MSN of such
information.
5. GENERAL INSURANCE REQUIREMENTS; PRODUCT
LIABILITY INDEMNITY
5.1 INSURANCE REQUIREMENTS
(a) During the Term, and for a period of five (5) years thereafter,
StarBand shall procure and maintain (at its expense) insurance reasonably
adequate to cover any and all liability that StarBand may incur as a result of
the performance of the Work under this Agreement (including, without limitation,
claims arising out of or relating to CPE). All such insurance shall name each
MSN Indemnified Person as an additional insured, will be in an amount not less
than that which is normally maintained by prudent manufacturers of comparable
equipment (and at least in the amounts provided below), will otherwise have
commercially normal terms and conditions satisfactory to MSN, will be in a form
and with
53
insurers reasonably acceptable to MSN and shall comply with the following
minimum requirements:
(i) Commercial General Liability Insurance (including product
liability insurance) of the Occurrence Form with policy
limits of not less Five Million Dollars (US$5,000,000)
combined single limit each occurrence for Bodily Injury and
Property Damage combined, and Five Million Dollars
(US$5,000,000) Personal and Advertising Injury Limit.
(ii) Errors & Omissions Liability/Professional Liability
Insurance with policy limits of not less than Five Million
Dollars (US$5,000,000) for each claim with a deductible of
not more than Fifty Thousand Dollars (US$50,000). Such
insurance shall include, but not be limited to, coverage
for infringement of proprietary rights of any third party,
including without limitation copyright and trademark
infringement as related to the performance of StarBand's
obligations under this Agreement.
(b) Throughout the term of this Agreement, the Professional Liability and
Errors & Omissions Liability Insurance retroactive coverage date will be no
later than the earliest date at which StarBand began performing the Work and
providing the Service.
(c) Not more than five (5) Business Days after the Effective Date, and
thereafter from time to time upon MSN's request, StarBand shall provide to MSN
proof evidencing full compliance with the insurance requirements set forth
herein. Failure by StarBand to furnish certificates of insurance, or failure by
MSN to request the same shall not constitute a waiver by MSN of any of the
insurance requirements set forth herein. StarBand shall notify MSN in writing if
the insurance coverage procured by it is to be canceled or materially altered so
as to not comply with the requirements of this provision, with such notice to be
provided to MSN no later than the later of (i) at least thirty (30) days in
advance of the cancellation or (ii) twenty-four (24) hours after StarBand
receives notice of the cancellation.
(d) In addition to the foregoing, StarBand shall ensure that at all times
during the Term, its Subcontractors shall maintain, at their own expense,
Commercial General Liability Insurance with policy limits substantially
identical to those listed in Section 5.1(a)(i) above, and such policies shall
name each MSN Indemnified Person and StarBand as an additional insured with
respect thereto. From time to time upon MSN's request, StarBand shall provide to
MSN proof evidencing full compliance with this Section 5.1(d).
5.2 PRODUCT LIABILITY INDEMNITY
StarBand will be responsible for all product liability associated with the
CPE and its design, development, testing, certification, production,
distribution and installation. StarBand indemnifies and agrees to protect,
defend, and hold harmless each MSN Indemnified Person against any Indemnifiable
Claims arising out of or relating to the CPE or its design, development,
testing, certification, production, distribution or installation,
54
including any injury to or death of any Person (including employees of StarBand,
MSN or any Subcontractor) or damage to any property or environment (including
property of any MSN Indemnified Person or any other Person) allegedly caused by
any CPE or part thereof.
6. CUSTOMER AND MSN ASSISTANCE
6.1 HELP DESK CAPABILITIES
During the Term, StarBand will, operate and maintain a help desk and
provide all services related thereto. The help desk will be responsible promptly
and effectively to resolve any problem arising with respect to the Service or
the Work. Without limiting StarBand's obligations hereunder, required help desk
services will include problem resolution services as related to all aspects of
the Service and the Work (including Customer assistance, Service performance
measurements, documentation, information retrieval, CPE performance,
installation, maintenance, and repair, troubleshooting, fault isolation and
problem resolution activities). As to be provided in the Network Operations Plan
and the Service Level Agreement, required help desk resources will include
databases, support tools, communication links/equipment, and a diagnostic
laboratory for problem replication and troubleshooting. If necessary, help desk
personnel (at MSN's option) will be available on-site at a Customer's premises
to facilitate problem resolution. StarBand will provide adequate and on-going
training for all help desk personnel (including MSN help desk personnel) and
will operate and maintain the help desk and provide help desk services in
conformance with best industry practices as employed by leading operators in the
telecommunication industry.
6.2 CONTINUOUS OPERATION
StarBand shall dedicate exclusively and make available to MSN on a
continuous basis (24x7 days per week) the help desk and all help desk services,
including adequate skilled logistics, operations and engineering personnel
necessary to resolve issues in a timely manner, and all hardware, facilities,
simulators, emulators and test beds that are used with respect to the Service.
The help desk's exclusive dedication to the Service will not permit sharing of
the help desk or any help desk personnel with other StarBand-related projects
unless MSN otherwise agrees. The help desk will maintain an automated bulletin
board providing configuration management information, critical trouble tickets,
suggested work-arounds, suspected problems, technical notes and information
about known problems with respect to the Service.
6.3 INTERACTIONS WITH MSN
Throughout the Trial Period, MSN and StarBand will work together to
integrate the Service with MSN's normal commercial operations, including, but
not limited to, MSN help desk and billing services. In connection therewith, the
Network Operations Plan will include help desk procedures for interactions among
the help desk, the StarBand NOC and the MSN NOC and allocation of help desk
resources for problem resolution. StarBand will utilize a trouble ticketing
system for the help desk that is compatible with MSN's own trouble
55
ticketing system. MSN will have the ability to monitor in real time the status
of any trouble ticket currently being tracked or resolved by StarBand's help
desk. In addition, StarBand shall make available to MSN, in real time, the
status and resolution of all historical trouble tickets tracked and resolved by
its help desk. Problems reported to StarBand will be tracked, compiled, and
analyzed for trends and quality metrics tracking in accordance with the Network
Operations Plan.
6.4 INTERACTIONS WITH MSN CUSTOMERS
For any MSN Customer requesting technical assistance with respect to
utilization of the Service, MSN will be the first point of contact (unless such
request pertains to the CPE or the installation, repair or replacement thereof,
in which case MSN may escalate the issue as provided below). Unless otherwise
directed by MSN, the help desk will respond to such requests only after
escalation from MSN. Upon receipt of any request, MSN will initially attempt to
resolve the technical or operational problem raised by such MSN Customer.
StarBand will, at no additional cost to MSN, provide MSN throughout the Term
with such information and training as necessary to enable MSN to provide answers
to the most common concerns (i.e., "Tier 1 problems") with respect to the
Service.
If MSN concludes it is unable to resolve any issue in a timely manner, or
the MSN Customer request pertains to the CPE or the installation, repair or
replacement thereof (i.e., "Tier 2 problems"), MSN may then escalate such MSN
Customer request to the StarBand help desk for assistance and resolution. The
help desk procedures will establish logging and categorization procedures for
assistance requests. In handling any request escalated by MSN, StarBand's help
desk will communicate only with MSN (and will have no contact with the MSN
Customer requesting such assistance) unless MSN directs otherwise. StarBand will
be responsible for prompt resolution of all Tier 2 problems. The Service Level
Agreement will include required resolution periods for Tier 2 problems, such
resolution periods to correspond to the severity of the problem involved.
6.5 MSN SUPPORT
In addition to assisting with MSN Customer problem resolution, the help
desk will also be responsible for providing technical support and assistance to
MSN and the MSN NOC (all in conformance with best industry practices, as
employed by leading manufacturers and operators in the telecommunication and
aerospace industries).
StarBand shall be responsible for all technical, operational, network
integrity and network performance issues identified by MSN to StarBand or
identified by any MSN Customer relating to the Service. StarBand will ensure
network service levels as defined in the Service Level Agreement.
7. SUBCONTRACTORS
Subject to the other requirements of this Agreement, StarBand may
have any of the Work performed by Subcontractors pursuant to one or more
Subcontracts; provided
56
that any subcontracting of, or change of any of the Subcontractors for, any of
the Work will be subject to the prior approval of MSN, such approval not to be
unreasonably withheld. In all events, StarBand will be solely responsible to
engage and manage its Subcontractors in the performance of the Work, for all
Work performed by its Subcontractors, and for all acts and omissions of its
Subcontractors in performing the Work. Without limiting the generality of the
foregoing, StarBand will coordinate the performance of all of its Subcontractors
performing or supplying any portion of the Work and will expedite and generally
oversee the progress being made by its Subcontractors. StarBand will promptly
replace any of its Subcontractors performing the Work unsatisfactorily.
8. MANAGEMENT
StarBand will designate a single point of contact (a "Program Manager")
responsible for StarBand's performance under this Agreement. The Program Manager
shall be empowered by StarBand's executive management to exercise immediate
authority and control over StarBand's programs to meet StarBand's obligations
under this Agreement. The Program Manager will maintain communications and
coordination with MSN and ensure that teamwork and coordination are maintained
between the MSN and StarBand teams. The Program Manager will designate points of
responsibility for each major area of responsibility under this Agreement,
including with respect to CPE installation, CPE warranty repair, CPE
out-of-warranty repair, help desk support, and StarBand NOC operation. StarBand
agrees that it shall consult with MSN in connection with the selection of the
Program Manager. StarBand further agrees that such Program Manager shall be
replaced for inadequate performance of the aforementioned duties.
9. MSN ACCESS; BILLING; AUDIT RIGHTS; MARKET
PROJECTIONS
9.1 DATA AND FACILITIES
StarBand will provide MSN with access to all data and analysis related to
the Service and, upon MSN's request, MSN will have access to all facilities of
StarBand and its Subcontractors (to the extent related to the Work).
9.2 REPORTS AND REVIEWS
StarBand's Program Manager will, by the fifteenth (15th) day of each month,
supply MSN with monthly reports addressing the Work's technical status, its
performance, specific issues/problems and their appropriate corrective actions,
all major program risk items and corresponding mitigation plans and plans for
the next reporting period. The Program Manager shall also present to MSN formal
quarterly reviews, including matters to be addressed in the monthly reports and
other pertinent topics such as quality assurance and system testing. At MSN's
request, MSN will be entitled to participate in any reviews conducted by
manufacturers of Gilat or StarBand satellites or their Subcontractors.
57
9.3 INVOICES
Any invoice submitted by StarBand to MSN for payment shall include MSN
Customer data sufficient to enable MSN to reconcile the information set forth on
such invoice with MSN's own MSN Customer billing information, and which, at a
minimum, shall include each Service Customer's name and MSN identification
number (or a StarBand-provided identification number) for which such charges are
based. All StarBand invoices will be sent to MSN at the then-current address for
notices.
9.4 AUDIT RIGHTS
StarBand agrees to keep all usual and proper books of account and records
and all usual and proper entries and other documentation relating to (a) MSN's
usage of the Service, (b) the StarBand NOC, (c) StarBand's most favored customer
obligation set out in Section 8 of the Agreement, and (d) such other terms of
the Agreement as MSN may reasonably request. MSN shall have the right to cause
an audit and inspection to be made of such books and records, entries and
documentation of StarBand as they relate to StarBand's obligations under this
Agreement. Such audit shall be conducted by an independent, third party auditor
selected by MSN and all information disclosed and/or provided to such auditor in
connection with such audit will be subject to an appropriate prior written
confidentiality agreement. Any such audit shall be conducted, to the extent
possible, in a manner that does not interfere with the ordinary business
operations of StarBand. Any such audit shall be paid for by MSN unless material
discrepancies are disclosed in the auditor's report. "Material" shall mean a
five percent (5%) or greater discrepancy between information previously reported
to MSN by StarBand and that information contained in the auditor's report. If
material discrepancies are disclosed, StarBand agrees to pay for the costs
associated with the audit, in addition to the amount of the discrepancy paid by
MSN plus interest at the highest LIBOR rate from time to time set forth in the
Wall Street Journal in the United States plus six (6) percentage points (or, if
less, at a rate equal to the highest rate permitted under applicable law).
58
ATTACHMENT 1 TO ANNEX B-1
CPE TRADEMARK GUIDELINES
The MSN Trademark:
[insert MSN logo here]
- Newco may use the MSN Trademark on the CPE and related packaging,
documentation, advertising, marketing, and collateral materials,
solely to indicate that MSN is providing the Service. Placement and
sizing of the MSN Trademark shall be pre-approved in writing by
Microsoft or MSN.
- The MSN Trademark may not be used in any manner that expresses or
might imply MSN's or Microsoft's affiliation, sponsorship,
endorsement, certification, or approval, other than as contemplated
by the Agreement.
- Newco shall not use the MSN Trademark in association with any third
party trademarks in a manner that might suggest co-branding or
otherwise create potential confusion as to source or sponsorship of
the CPE or ownership of the MSN Trademark.
- The MSN Trademark and "MSN" may not be included in any non-Microsoft
trade name, business name, domain name, product or service name,
logo, trade dress, design, slogan, or other trademark.
- Newco may use the MSN Trademark only as provided by Microsoft or MSN
electronically or in hard copy form. Except for size subject to the
restrictions herein, the MSN Trademark may not be altered in any
manner, including proportions, colors, elements, etc., or animated,
morphed, or otherwise distorted in perspective or dimensional
appearance.
- The MSN Trademark may not be combined with any other symbols,
including words, logos, icons, graphics, photos, slogans, numbers, or
other design elements.
- The MSN Trademark (including but not limited to Microsoft's logos,
logotypes, trade dress, and other elements of product packaging and
web sites) may not be imitated in any of Newco's materials.
- The MSN Trademark may not be used as a design feature in any
materials.
- The MSN Trademark must stand alone. A minimum amount of empty space
must surround the MSN Trademark separating it from any other object,
such as type, photography, borders, edges, other logos, and so on.
The required area of empty space around the MSN Trademark must be 1x,
where x equals the height of the MSN Trademark.
59
- Except on CPE itself, each use of the MSN Trademark must include the
notice: "MSN" is a trademark of Microsoft Corporation in the United
States and/or other countries and is used under license from
Microsoft".
- For all MSN Customers, the USB Boxes will feature equally, the MSN
brand (the "MSN Brand") and the Newco brand (the "Newco Brand").
- The satellite dish or antenna to be used by MSN Customers will
feature the MSN Brand and will include a subordinate reference to
"powered by Newco" or a similar phrase (as may be agreed by MSN and
Newco). The area on each such satellite dish for the MSN Brand and
that for the related reference to Newco will be on a 4:1 basis.
- Installation and usage documentation will be provided by Newco and
will feature equally the MSN Brand and the Newco Brand.
60
ANNEX C
SERVICE LEVEL AGREEMENT
61
[STARBAND COMMUNICATIONS LOGO]
StarBand Communications
MSN Service Level Agreement
[*]
[*] Seven pages of information have been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
62
ANNEX D
NONDISCLOSURE AGREEMENT
63
Annex D
MICROSOFT CORPORATION NON-DISCLOSURE AGREEMENT
(STANDARD RECIPROCAL)
This Non-Disclosure Agreement (the "Agreement") is made and entered into
as of the later of the two signature dates below by and between MICROSOFT
CORPORATION, a Washington corporation ("Microsoft"), and STARBAND
COMMUNICATIONS INC./DELAWARE corporation ("Company").
IN CONSIDERATION OF THE MUTUAL PROMISES AND COVENANTS CONTAINED IN THIS
AGREEMENT AND THE MUTUAL DISCLOSURE OF CONFIDENTIAL INFORMATION, THE PARTIES
HERETO AGREE AS FOLLOWS:
1. Definition of Confidential Information and Exclusions.
(a) "Confidential Information" means nonpublic information that a
party to this Agreement ("Disclosing Party") designates as being confidential
to the party that receives such information ("Receiving Party") or which,
under the circumstances surrounding disclosure ought to be treated as
confidential by the Receiving Party. "Confidential Information" includes,
without limitation, information in tangible or intangible form relating to
and/or including released or unreleased Disclosing Party software or hardware
products, the marketing or promotion of any Disclosing Party product,
Disclosing Party's business policies or practices, and information received
from others that Disclosing Party is obligated to treat as confidential.
Except as otherwise indicated in this Agreement, the term "Disclosing Party"
also includes all Affiliates of the Disclosing Party and, except as otherwise
indicated, the term "Receiving Party" also includes all Affiliates of the
Receiving Party. An "Affiliate" means any person, partnership, joint venture,
corporation or other form of enterprise, domestic or foreign, including but
not limited to subsidiaries, that directly or indirectly, control, are
controlled by, or are under common control with a party.
(b) Confidential Information shall not include any information,
however designated, that: (i) is or subsequently becomes publicly available
without Receiving Party's breach of any obligation owed Disclosing Party; (ii)
became known to Receiving Party prior to Disclosing Party's disclosure of such
information to Receiving Party pursuant to the terms of this Agreement; (iii)
became known to Receiving Party from a source other than Disclosing Party
other than by the breach of an obligation of confidentiality owed to
Disclosing Party; (iv) is independently developed by Receiving Party; or (v)
constitutes Feedback (as defined in Section 5 of this Agreement).
2. Obligations Regarding Confidential Information
(a) Receiving Party shall:
(i) Refrain from disclosing any Confidential Information of
the Disclosing Party to third parties for two (2) years
following the date that Disclosing Party first discloses
such Confidential Information to Receiving Party, except
as expressly provided in Sections 2(b) and 2(c) of this
Agreement;
(ii) Take reasonable security precautions, at least as great as
the precautions it takes to protect its own confidential
information, but no less than reasonable care, to keep
confidential the Confidential Information of the
Disclosing Party;
(iii) Refrain from disclosing, reproducing, summarizing and/or
distributing Confidential Information of the Disclosing
Party except in pursuance of Receiving Party's business
relationship with Disclosing Party, and only as otherwise
provided hereunder; and
(iv) Refrain from reverse engineering, decompiling or
disassembling any software code and/or pre-release
hardware devices disclosed by Disclosing Party to
Receiving Party under the terms of this Agreement, except
as expressly permitted by applicable law.
(b) Receiving Party may disclose Confidential Information of
Disclosing Party in accordance with a judicial or other governmental order,
provided that Receiving Party either (i) gives the undersigned Disclosing
Party reasonable notice prior to such disclosure to allow Disclosing Party a
reasonable opportunity to seek a protective order or
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
64
equivalent, or (ii) obtains written assurance from the applicable judicial or
governmental entity that it will afford the Confidential Information the
highest level of protection afforded under applicable law or regulation.
Notwithstanding the foregoing, the Receiving Party shall not disclose any
computer source code that contains Confidential Information of the Disclosing
Party in accordance with a judicial or other governmental order unless it
complies with the requirement set forth in sub-section (i) of this Section
2(b).
(c) The undersigned Receiving Party may disclose Confidential
Information only to Receiving Party's employees and consultants on a
need-to-know basis. The undersigned Receiving Party will have executed or
shall execute appropriate written agreements with third parties sufficient to
enable Receiving Party to enforce all the provisions of this Agreement.
(d) Receiving Party shall notify the undersigned Disclosing Party
immediately upon discovery of any unauthorized use or disclosure of
Confidential Information or any other breach of this Agreement by Receiving
Party and its employees and consultants, and will cooperate with Disclosing
Party in every reasonable way to help Disclosing Party regain possession of
the Confidential Information and prevent its further unauthorized use or
disclosure.
(e) Receiving Party shall, at Disclosing Party's request, return all
originals, copies, reproductions and summaries of Confidential Information
and all other tangible materials and devices provided to the Receiving Party
as Confidential Information, or at Disclosing Party's option, certify
destruction of the same.
3. Remedies
The parties acknowledge that monetary damages may not be a sufficient
remedy for unauthorized disclosure of Confidential Information and that
Disclosing Party shall be entitled, without waiving any other rights or
remedies, to such injunctive or equitable relief as may be deemed proper by a
court of competent jurisdiction.
4. Miscellaneous
(a) All Confidential Information is and shall remain the property of
Disclosing Party. By disclosing Confidential information to Receiving Party,
Disclosing Party does not grant any express or implied right to Receiving
Party to or under any patents, copyrights, trademarks, or trade secret
information except as otherwise provided herein. Disclosing Party reserves
without prejudice the ability to protect its rights under any such patents,
copyrights, trademarks, or trade secrets except as otherwise provided herein.
(b) In the event that the Disclosing Party provides any computer
software and/or hardware to the Receiving Party as Confidential Information
under the terms of this Agreement, such computer software and/or hardware may
only be used by the Receiving Party for evaluation and providing Feedback (as
defined in Section 5 of this Agreement) to the Disclosing Party. Unless
otherwise agreed by the Disclosing Party and the Receiving Party, all such
computer software and/or hardware is provided "AS IS" without warranty of any
kind, and Receiving Party agrees that neither Disclosing Party nor its
suppliers shall be liable for any damages whatsoever arising from or relating
to Receiving Party's use or inability to use such software and/or hardware.
(c) The parties agree to comply with all applicable international and
national laws that apply to (i) any Confidential Information, or (ii) any
product (or any part thereof), process or service that is the direct product
of the Confidential Information, including the U.S. Export Administration
Regulations, as well as end-user, end-use and destination restrictions issued
by U.S. and other governments. For additional information on exporting
Microsoft products, see ▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇▇▇/.
(d) The terms of confidentiality under this Agreement shall not be
construed to limit either the Disclosing Party or the Receiving Party's right
to independently develop or acquire products without use of the other party's
Confidential Information. Further, the Receiving Party shall be free to use
for any purpose the residuals resulting from access to or work with the
Confidential Information of the Disclosing Party, provided that the Receiving
Party shall not disclose the Confidential Information except as expressly
permitted pursuant to the terms of this Agreement. The term "residuals" means
information in intangible form, which is retained in memory by persons who
have had access to the
2
65
Confidential Information, including ideas, concepts, know-how or techniques
contained therein. The Receiving Party shall not have any obligation to limit
or restrict the assignment of such persons or to pay royalties for any work
resulting from the use of residuals. However, this sub-paragraph shall not be
deemed to grant to the Receiving Party a license under the Disclosing Party's
copyrights or patents.
(e) This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof. It shall not be modified
except by a written agreement dated subsequent to the date of this Agreement
and signed by both parties. None of the provisions of this Agreement shall be
deemed to have been waived by any act or acquiescence on the part of
Disclosing Party, the Receiving Party, their agents, or employees, but only by
an instrument in writing signed by an authorized employee of Disclosing Party
and the Receiving Party. No waiver of any provision of this Agreement shall
constitute a waiver of any other provision(s) or of the same provision on
another occasion.
(f) If either Disclosing Party or the Receiving Party employs
attorneys to enforce any rights arising out of or relating to this Agreement,
the prevailing party shall be entitled to recover reasonable attorneys' fees
and costs. This Agreement shall be construed and controlled by the laws of the
State of Washington, and the parties further consent to exclusive jurisdiction
and venue in the federal courts sitting in King County, Washington, unless no
federal subject matter jurisdiction exists, in which case the parties consent
to the exclusive jurisdiction and venue in the Superior of King County,
Washington. Company waives all defenses of lack of personal jurisdiction and
forum non conveniens. Process may be served on either party in the manner
authorized by applicable law or court rule.
(g) This Agreement shall be binding upon and inure to the benefit of
each party's respective successors and lawful assigns; provided, however, that
neither party may assign this Agreement (whether by operation of law, sale of
securities or assets, merger or otherwise), in whole or in part, without the
prior written approval of the other party. Any attempted assignment in
violation of this Section shall be void.
(h) If any provision of this Agreement shall be held by a court of
competent jurisdiction to be illegal, invalid or unenforceable, the remaining
provisions shall remain in full force and effect.
(i) Either party may terminate this Agreement with or without cause
upon ninety (90) days prior written notice to the other party. All sections of
this Agreement relating to the rights and obligations of the parties
concerning Confidential Information disclosed during the term of the Agreement
shall survive any such termination.
5. Suggestions and Feedback
The Receiving Party may from time to time provide suggestions, comments
or other feedback ("Feedback") to the Disclosing Party with respect to
Confidential Information provided originally by the Disclosing Party. Both
parties agree that all Feedback is and shall be given entirely voluntarily.
Feedback, even if designated as confidential by the party offering the
Feedback, shall not, absent a separate written agreement, create any
confidentiality obligation for the receiver of the Feedback. Furthermore,
except as otherwise provided herein or in a separate subsequent written
agreement between the parties, the receiver of the Feedback shall be free to
use, disclose, reproduce, license or otherwise distribute, and exploit the
Feedback provided to it as it sees fit, entirely without obligation or
restriction of any kind on account of intellectual property rights or
otherwise.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
COMPANY: STARBAND COMMUNICATIONS INC. MICROSOFT CORPORATION
Address: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇. One Microsoft Way
McLean, VA 22102 ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------- ---------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------- -------------------------------------
Title: PRESIDENT & CHIEF MARKETING OFFICER Title: Director
------------------------------------ ------------------------------------
Date: October 20, 2000 Date: November 11, 2000
------------------------------------- -------------------------------------
3
66
ANNEX E
TERMINATION AGREEMENT
67
TERMINATION AGREEMENT
Reference is hereby made to the Performance Guarantee Agreement by Gilat
Satellite Networks, Ltd. ("Gilat") dated February 15, 2000 ("Performance
Guarantee") a copy of which is annexed hereto as Exhibit 1 and the Agreement
Relating to Gilat Supply Agreements annexed hereto as Exhibit 2 ("Back to Back
Agreement").
WHEREAS, the Parties below desire to terminate the Back to Back Agreement in its
entirety and, with respect to the Performance Guarantee, to terminate Gilat's
obligations thereunder except for certain obligations specified herein, and
WHEREAS, Gilat agrees to continue to warrant to the Microsoft Network LLC
("MSN") that the USB-CPE supplied by Gilat to StarBand Communications Inc.
("StarBand") shall conform to the agreed specifications set forth in the CPE
Plan attached to the Amended and Restated Broadband Access Services Supply
Agreement dated October 20, 2000, between MSN and Starband ("MSN Supply
Agreement") (capitalized terms not herein defined shall have the same meaning as
set forth in the MSN Supply Agreement).
NOW THEREFORE, the parties hereto agree as follows:
1. The Back to Back Agreement is hereby terminated effective on the date
appearing below and shall have no further force or effect.
2. Gilat's obligations under the Performance Guarantee are hereby terminated
effective as of the date appearing below and shall have no further force
or effect, provided, however, that Gilat's obligations under the
Performance Guarantee shall continue in full force and effect solely with
respect to the provisions of Article VI of the Investment Agreement by
and among Spacenet, Inc., Gilat-To-Home, Inc., Microsoft G-Holdings,
Inc., and Microsoft Corporation dated February 15, 2000, as amended by
the Effectiveness Agreement by and among Gilat, Gilat-To-Home, Inc.,
Spacenet, Inc., Microsoft G-Holdings., Inc., EchoStar Communications
Corporation, ▇▇▇▇▇▇ ▇▇▇▇ Investors II L.P., FS Employee Investors LLC and
FS Parallel Fund L.P., dated March 30, 2000, and as further amended by
the Assignment and Amendment and the Second Assignment and Amendment,
both dated August 2000.
3. Gilat warrants to MSN that it shall for the entire term of the MSN Supply
Agreement cause the USB-CPE supplied by it to Starband to be in strict
conformity with the agreed specifications set forth in the CPE Plan
attached to the MSN Supply Agreement.
This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original, and all of which shall constitute one and the same
agreement.
68
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly
executed by its duly authorized officer on this 20th day of October, 2000.
SPACENET INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name:
Title:
STARBAND COMMUNICATIONS INC.
(FORMERLY GILAT-TO-HOME INC.)
By: /s/ ZUR ▇▇▇▇▇▇▇
---------------------------------
Name:
Title:
GILAT SATELLITE NETWORK LTD.
By: /s/ ▇▇▇▇ GAT
---------------------------------
Name:
Title:
MICROSOFT G-HOLDINGS INC.
By: /s/ ▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name:
Title:
MICROSOFT CORPORATION
By: ▇▇▇ KUMMART
---------------------------------
Name:
Title: VP
69
ANNEX F
CPE PLAN
70
[STARBAND COMMUNICATIONS LOGO]
CPE PLAN
StarBand Communications Inc.
Revision Level: 1.0 MSN Approval/Date:
Release Date: 10/20/00 ___________________
-------------------
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
71
CPE PLAN
CONTENTS
1. INTRODUCTION ................................................................................................... 4
2 CPE SPECIFICATIONS ............................................................................................. 4
2.1 Current CPE ............................................................................................. 4
2.1.1 PC and peripherals ............................................................................... 4
2.1.2 StarBand cardset ................................................................................. 4
2.1.2.1 Receiver Board ........................................................................... 4
2.1.2.2 Transmitter Board ........................................................................ 4
2.1.2.3 Power Supply ............................................................................. 5
2.1.3 Software ........................................................................................ 5
2.1.4 Antenna ......................................................................................... 5
2.1.4.1 Non-penetrating round or Roof Mount .............................................. 5
2.1.4.2 Wall/Roof Mounts ................................................................. 6
2.1.5 Cabling .................................................................................. 6
2.1.6 Documentation ............................................................................ 6
2.2 CPE Evolution Plan ...................................................................................... 6
3 CONSUMER INSTALLATION EXPERIENCE FEEDBACK ...................................................................... 6
4 WARRANTY REPAIR AND REPLACEMENT PROCEDURES ..................................................................... 7
4.1 CPE Warranty ............................................................................................ 7
4.2 Diagnostics plan ........................................................................................ 7
4.3 Repair and replacement .................................................................................. 7
5 MAINTENANCE PROGRAMS AND PROCEDURES ............................................................................ 7
5.1 Upgrades during milestone trial periods ................................................................. 7
5.2 Upgrades after Full Availability Date ................................................................... 7
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
72
CPE PLAN
6 USB BOX DEVELOPMENT PLAN ....................................................................................... 8
6.1 USB box specifications .................................................................................. 8
6.2 USB box development schedule ............................................................................ 10
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
2
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CPE PLAN
- This document is provided for use only by authorized representatives of
MSN. It contains confidential information proprietary to StarBand
Communications Inc., that may be protected by various intellectual
property laws, and may not be reproduced in whole or in part,
electronically or otherwise, without the express written consent of
StarBand Communications Inc. The disclosure by StarBand Communications
Inc. of information contained herein does not constitute any license or
authorization to use or disclose the information, ideas, or concepts
presented. The contents of this document are subject to change without
prior notice.
- StarBand and the StarBand family of marks are owned by StarBand
Communications Inc.
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
3
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CPE PLAN
1 INTRODUCTION
The Customer Premises Equipment (CPE) Plan describes the equipment that
StarBand will provide to each customer for installation in the home.
Information presented includes specification of the hardware and
software, as well as installation, warranty, and maintenance plans.
Finally, the document presents plans for evolution of the product to
future platforms.
2 PCI CPE SPECIFICATIONS
This section presents a description of the equipment included in the CPE.
2.1 CURRENT CPE
2.1.1 PC AND PERIPHERALS
The StarBand home unit currently in distribution is hosted on a
PC. The minimum requirements for this unit are:
- Pentium (or faster) processor
- 32 MB RAM
- Hard drive (128 MB required)
- VGA or higher-resolution display adapter
- Sound card
- Keyboard
- Mouse
- Monitor
2.1.2 STARBAND CARDSET
2.1.2.1 Receiver board
The StarBand receiver board is a PCI card that is manufactured by
BroadLogic or a compatible alternative (OEM). This card delivers
up to 30 Msps (million symbols per second).
2.1.2.2 Transmitter board
The StarBand transmitter board is manufactured by StarBand. This
is a PCI card capable of transmitting 153.6 Kbps.
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
4
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CPE PLAN
2.1.2.3 Power supply
An external 24V power supply is included. This power supply
connects to the transmitter board and supplies the power for the
StarBand outdoor unit (ODU).
2.1.3 SOFTWARE
The minimum software required on the CPE includes:
- Windows 98 SE or Me
- MS Internet Explorer 5.01
- StarBand software
The following software has been tested on the CPE but is not
required. Future updated list to be provided by StarBand.
- MS Office 2000
- Antivirus software
- VNC 3.3.3r2 remote control software
- Adobe Acrobat Reader 4.0
- RealPlayer 7 Basic
- MS PPTP
- Media player 6.4
- Quick time 4.01
- Active Perl 5.21
2.1.4 ANTENNA
The antenna provided to the consumer is a 0.75e (meter) elliptical
antenna.
The outdoor electronics include a Ku-band LNB and ODU for data
receipt and transmission.
Antenna mounts available are described below. All mounts include
hardware for grounding (8' grounding rod, dual ground block, 8 AWG
grounding wire, and self-tapping screw). Other types of mounts
will be considered as well.
2.1.4.1 Non-penetrating ground or roof mount
The non-penetrating mount can be placed on a hard flat ground
surface (cement, asphalt) or a flat roof (with proper support).
The 36" x 36" mounting base is attached to a 3' pole. Concrete
block is provided for ballast.
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
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CPE PLAN
2.1.4.2 Wall/roof mount
This is a 3-leg tripod mount that can be attached to a wall or a
pitched roof.
2.1.5 CABLING
Cable, connectors, and wall plates are provided to connect the PC
to the antenna outdoor electronics.
Amaximum of 75 feet of cable length is provided (x 2) between the
antenna/mount and the PC inside the house.
The two data cables are run through a wall plate to the PC.
2.1.6 DOCUMENTATION
Each CPE unit package includes the following documentation:
- StarBand User Guide
During the trial phases of the program, the following additional
documentation is included:
- Informational and/or cautionary inserts as applicable
2.2 USB CPE EVOLUTION PLAN
Future plans for the CPE include changes for both the platform and the
VSAT technology.
A VSAT USB or Ethernet "appliance" is currently in development. This will
allow StarBand to offer consumers broadband Internet service using their
existing PCs (provided certain minimum requirements are met).
The USB Box section below provides details of this plan.
3 CONSUMER INSTALLATION EXPERIENCE FEEDBACK
Feedback and surveys will be conducted by MSN for MSN subscribers only.
All announcements, advertisement, surveys and other correspondence,
regardless of the media used, Internet, brouchure, coupons must be pre
approved by MSN. This requirement is applicable to the extent an MSN
subscriber will be the receipient.
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
6
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CPE PLAN
4 WARRANTY REPAIR AND REPLACEMENT PROCEDURES
4.1 CPE WARRANTY
StarBand will supply to MSN a CPE warranty freely transferable to each
MSN customer. The warranty will state that the CPE will be free from
defects in material and workmanship and will operate in accordance with
specified design and performance standards. Each StarBand installer will
warrant to each MSN customer that the CPE installation has been performed
in accordance with the standards specified in the StarBand Installation
Guide.
For ninety (90) days after installation, the CPE will be subject to a
full StarBand warranty, covering installation, labor, and parts.Extended
warranty options will be provided by StarBand via approved MSN retail
channels.
4.2 DIAGNOSTICS PLAN
Technical support will be provided in accordance with the above warranty.
Procedures to validate warranty status are to be specified.
Troubleshooting procedures for the CPE will be provided by StarBand to
the MSNIA Program Manager. Some leaves of the troubleshooting tree
indicate hardware failure as the likely cause. In the event of hardware
failure, a hardware replacement is required to resolve the problem.
4.3 REPAIR AND REPLACEMENT
Repair and replacement procedures for system hardware during the pilot
period are detailed in the StarBand Pilot Phase Maintenance Dispatch
Procedure. Procedures for repair and replacement after the full
availability date will be agreed upon by StarBand, MSN, and other
partners and included in the NOP.
5 MAINTENANCE PROGRAMS AND PROCEDURES
5.1 UPGRADES DURING MILESTONE TRIAL PERIODS
During the trial period, users receive software updates in two ways.
First, an upgrade may be multicast to all users at once. The upgrade date
and time is announced in advance after testing and agreement by MSNIA. To
receive the upgrade, users are required to have their systems on at the
prescribed time. Second, upgrades will be available for download on the
MSN website.
5.2 UPGRADES AFTER FULL AVAILABILITY DATE
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
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CPE PLAN
After the Full Availability date, upgrades will be available by various
means as the enabling technology evolves. As future revisions of the
product become available, StarBand will make their best effort to ensure
that the latest USB standard is incorporated in the product.
6. USB BOX DEVELOPMENT PLAN
[GRAPHIC]
6.1 USB BOX SPECIFICATIONS
The Satellite Modem supports the USB 1.1 standard.
Maximum USB cable length is 6 meters.
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
8
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CPE PLAN
Ethernet Interface:
The Satellite Modem supports a standard 10BaseT Ethernet
interface.
The Ethernet cable between the modem and a PC has to be a crossed
cable (the connector on the Satellite Modem is non-crossed).
The Satellite Modem has 6 LED indicators:
PWR (Power On)
(Rx Lock - Outbound receiver is locked)
SYN (Synchronization packets are properly received; ready to
connect)
CON (On-Line - Connection with the hub was established)
Tx (Transmitting - Modem is transmitting to the hub)
PC (Data Activity - Data is received from the PC or sent to it, by
USB or Ethernet interface)
Dimensions: 8.4" x 8.7" x 3.5"
Outbound (from Satellite) Data Rates: 1.84 Mbps to [*]
Inbound (from USB CPE) Data Rates: up to 153.6 kbps
Operating Environmental Conditions:
Ambient Temperature: 0(degrees) C/32(degrees) F to 50(degrees)
C/122(degrees) F
From 60(degrees) C/144(degrees) F de-rate linearly to 75% of full
load at 70(degrees) C/158(degrees) F
Relative Humidity: 5% - 95%
Altitude: Sea level to 15,000 feet.
MTBF: Calculated MTBF per MIL-HDBK_217E shall be at least 100,000
hours at full load at 25(degrees) C/77(degrees) F.
Cooling: The power supply, mounted in the box, is convection
cooled, and doesn't need a fan.
Output Frequencies: 950 to 1450 MHz
Input Interface: WR-75 coaxial cable
Output Interface: WR-75 coaxial cable
Input voltage range: +15 to +24 VDC
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
9
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CPE PLAN
6.2 USB BOX DEVELOPMENT SCHEDULE
The USB solution development schedule targets are:
- StarBand beta testing: [*]
- StarBand production : [*]
- MSN deliveries begin: [*]
Confidential - For use only by authorized MSN
personnel. Not for use or disclosure to unauthorized
persons except by written approval of StarBand
Communications Inc. Rev. 1.0
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
10
81
ANNEX G
NETWORK OPERATIONS PLAN
82
[STARBAND COMMUNICATIONS LOGO]
NETWORK OPERATIONS PLAN
StarBand Communications Inc.
[*]
[*] 65 pages of information have been omitted and filed separately with the
Commission. Confidential treatment has been requested with respect to the
omitted portions.
83
ANNEX H
ADDITIONAL REVENUE SERVICES AGREEMENT
84
ADDITIONAL REVENUE SERVICES AGREEMENT
This Additional Revenue Services Agreement, dated as of February 15, 2000
(as from time to time amended, modified or supplemented, the "Agreement"), by
and between The Microsoft Network L.L.C., a Delaware limited liability company
("MSN"), and Newco, a Delaware corporation ("Newco"). Capitalized terms used and
not otherwise defined herein shall have the meanings ascribed to them in the
Supply Agreement (as defined below).
RECITALS
WHEREAS, Newco, a company owned jointly by Microsoft G-Holdings, Inc., a
Nevada corporation("Microsoft Holdings"), and Spacenet Inc. ("Spacenet"), a
Delaware corporation and wholly-owned subsidiary of Gilat Satellite Networks,
Ltd., an Israeli corporation ("Gilat"), will provide satellite Internet access
to North American consumers, small business and home office customers and to
ISPs (including MSN) serving such customers (the "Service");
WHEREAS, in connection with offering the Service to such customers, MSN
and Newco have entered into that certain Broadband Access Services Supply
Agreement of even date herewith (as from time to time amended, modified or
supplemented, the "Supply Agreement");
WHEREAS, MSN and Newco have also agreed to enterinto that certain
Co-Branded Portal Agreement(as from time to time amended, modified or
supplemented, the "Co-Branded Portal Agreement"), pursuant to which MSN will
develop a co-branded portal for Newco and other ISP customers;
WHEREAS, Gilat has executed and delivered in favor of MSN and Microsoft
Holdings that certain Performance Guarantee Agreement, of even date herewith (as
from time to time amended, modified or supplemented, the "Guarantee"), pursuant
to which Gilat has irrevocably and unconditionally guaranteed (i) all of Newco's
obligations under this Agreement, the Supply Agreement and each other Operative
Document to which Newco is a party and (ii) all of Spacenet's obligations under
the Operative Documents to which it is a party;
WHEREAS, in addition to the Guarantee, Newco, Spacenet and Gilat have
entered into that certain Agreement Relating to Gilat Supply Agreements, of even
date herewith (as from time to time amended, modified or supplemented, the
"Agreement Relating to Gilat Supply Agreements"), pursuant to which (a) Gilat
will supply to Spacenet, at agreed upon prices and other terms and conditions,
certain products and services that Spacenet is obligated to provide to Newco
under the terms of the second (2d) paragraph of the Agreement Relating to Gilat
Supply Agreements, (b) Spacenet will supply to Newco, at agreed upon prices and
other terms and conditions, certain products and services that Newco is
obligated to provide to MSN under the terms of the Supply Agreement and (c)
Gilat will assume all of Newco's
ADDITIONAL REVENUE SERVICES AGREEMENT
EXECUTION COPY
85
and Spacenet's liabilities and obligations related to such products and services
under the Supply Agreement and the Agreement Relating to Gilat Supply
Agreements; and
WHEREAS, MSN and Newco (each, from time to time referred to herein as a
"Party," and together as the "Parties") wish to establish a framework within
which additional sources of Internet-related revenue may be generated and shared
between them.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
and agreements set forth herein, the receipt and sufficiency of which are hereby
acknowledged, Microsoft and Newco hereby agree as follows:
AGREEMENT
SECTION 1. ADDITIONAL REVENUE SERVICES
(a) These provisions pertain to Additional Revenue Services (as
defined below) that may from time to time be offered by MSN on the MSN Service.
Similar or comparable services may from time to time be offered on the
Co-Branded Portal, Newco Cross-Linked Pages or through other ISPs; however, the
terms governing revenue sharing with respect thereto are set forth in the
Co-Branded Portal Agreement.
(b) An "Additional Revenue Service" is a satellite-based service that
satisfies all of the following requirements:
(i) A service that is not offered to all Customers, but
instead, is to be offered to select Customers in exchange for an additional fee
payable in addition to normal monthly access fees and other charges, and is not
similar to any services presently offered by MSN; and
(ii) A service that:
(A) provides to users of the Service creative content that
is owned or licensed by Newco, or
(B) a premium broadband service that provides Customers
with an improvement in Service performance above that
required by the agreed system specifications for the
Service; or
(C) a premium broadband service made possible by
technological innovations that are created or licensed by
Newco (as used in this subclause (C), "premium" refers to
additional functionality, speed or other capability in
excess of the specifications applicable to the Service); or
(D) is a new multicast service (a "multicast service" is
defined as a single, common Internet protocol ("IP") stream
originating from a
ADDITIONAL REVENUE SERVICES AGREEMENT
EXECUTION COPY
86
satellite, and to which multiple users are allowed access
to content through a common IP address and/or
authentication); or
(E) is a new broadcast service (a "broadcast service" is
defined as a single common bit stream originating from a
satellite, and to which multiple users are allowed access
to content through authentication); and
(iii) A service for which Newco and MSN agree upon the applicable
terms and conditions related thereto.
(c) Notwithstanding the foregoing, the Parties hereby agree and
acknowledge that:
(i) Neither Party shall be entitled to any sharing of any
premium revenues generated by an Additional Revenue Service unless Newco and MSN
expressly agree upon the terms and conditions to be applicable to such
Additional Revenue Service;
(ii) Premium broadband services do not include any content,
service or feature that MSN may offer utilizing the Service based upon the
Service's system specifications agreed to by the Parties pursuant to Section
3.1.2(d)(iii) of the Supply Agreement; and
(iii) Except as in accordance with this Agreement, nothing in the
preceding provisions obligates MSN to carry any Additional Revenue Services.
(d) Unless otherwise agreed, if an Additional Revenue Service is
determined by the Parties to be eligible for revenue sharing, then the
additional premium revenues, if any, generated by such Additional Revenue
Service shall, on a "net-of-cost" basis, be [*]. For purposes of this
Agreement, "net-of-cost" means the total amount of revenue generated by an
Additional Revenue Service less all fixed and variable costs and expenses
directly related to the provision of such Additional Revenue Service.
(e) If Additional Revenue Services are developed, the pages connected
to the Co-Branded Portal and the Newco Cross-Linked Pages will have cross-links
which will allow Newco Customers to obtain the Additional Revenue Services, and
the pages connected to the ▇▇▇.▇▇▇ portal will also have a cross-link enabling
MSN Customers utilizing the Service to access Additional Revenue Services.
SECTION 2. ACKNOWLEDGMENT
Newco acknowledges that MSN, in the normal course of its business,
engages in internal development of content, services and features to be utilized
in connection with ▇▇▇.▇▇▇ and other MSN-related websites and discusses such
content, services and features with a variety of companies, including
competitors of Newco. Accordingly, Newco agrees that, unless MSN specifically
agrees in writing, Newco and its Affiliates will not be entitled
ADDITIONAL REVENUE SERVICES AGREEMENT
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87
to claim any trade secret, proprietary information right or other intellectual
property or intangible right (whether statutory, common law, administrative or
otherwise, all of which Newco hereby expressly waives) with respect to any
content, services, or features (and including, without limitation, any ideas,
plans, materials, concepts, strategies and other items) which it may propose to
or discuss with MSN or Microsoft, and MSN and Microsoft will not have any
liability (including payment of royalty and liability for infringement) to, or
be required to solicit the participation of, Newco in any content, services or
features MSN or Microsoft may wish to utilize directly, through or with the
participation of Newco competitors or otherwise. The foregoing absence of MSN
and Microsoft liability shall be applicable regardless of any similarity to any
content, services, or features (and including, without limitation, any ideas,
plans, materials, concepts, strategies or other items) that Newco or any of its
Affiliates may propose to, or discuss with, MSN or Microsoft (unless MSN
specifically agrees in writing, Newco on behalf of itself and its Affiliates
hereby waiving and disclaiming any such liability and granting to MSN and to
Microsoft a nonexclusive, royalty-free, perpetual, irrevocable, transferable,
world-wide license, with the right to grant sublicenses, to make, reproduce,
use, sell, distribute, otherwise dispose of, prepare derivative works based on,
perform, display and otherwise exploit all such content, services, and features
and any ideas, plans, materials, concepts, strategies or other items related
thereto). MSN, Microsoft and their Affiliates at no time will be under any
obligation to disclose or license to Newco or any of its Affiliates any content,
services or features that MSN or Microsoft may have under development or
regarding which MSN or Microsoft may be in discussions with others.
SECTION 3. CONFIDENTIALITY
(a) The terms and conditions of the Microsoft Corporation
Non-Disclosure Agreement ("NDA") govern this Agreement and all discussions,
negotiations and documentation relating to this Agreement as if fully set forth
herein. If any term of the NDA is inconsistent with, or conflicts with, this
Agreement, then the terms of this Agreement control.
(b) Newco may not use the name of MSN or any MSN Affiliate (or any of
their respective trademarks or service marks or any portion thereof), in any
advertising, publicity or press release or for any other business purpose
without the prior written approval of Microsoft.
SECTION 4. TERM
Subject to the other terms and conditions herein, the term of this
Agreement will be concurrent with the term of the Supply Agreement. This
Agreement will terminate upon any termination of the Supply Agreement for any
reason whatsoever.
ADDITIONAL REVENUE SERVICES AGREEMENT
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88
SECTION 5. LIMITATION OF LIABILITIES
NO PARTY TO THIS AGREEMENT SHALL BE LIABLE TO ANOTHER PARTY FOR ANY
INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES, ARISING OUT
OF, OR RELATED TO, THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, DAMAGES FOR
LOSS OF BUSINESS PROFITS, BUSINESS INTERRUPTION, LOSS OF BUSINESS INFORMATION,
AND SIMILAR LOSSES, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES. THIS SECTION SHALL NOT APPLY TO ANY PARTY'S (A) ABILITY TO OBTAIN
INJUNCTIVE OR OTHER EQUITABLE RELIEF; AND (B) CONFIDENTIALITY OBLIGATIONS UNDER
SECTION 3.
SECTION 6. PRESS RELEASES
No Party to this Agreement shall issue any press release or make any
public announcement(s) relating in any way whatsoever to this Agreement or the
relationship established by this Agreement without the express prior written
consent of the other Parties hereto, which consent shall not be reasonably
withheld.
SECTION 7. GENERAL PROVISIONS
7.1 INDEPENDENT CONTRACTORS
The Parties are independent contractors with respect to one another and
nothing in this Agreement shall be construed as creating an employer-employee
relationship, partnership, agency relationship or joint venture among them.
7.2 GOVERNING LAW
THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, WITHOUT GIVING EFFECT TO ITS CONFLICTS-OF-LAWS PRINCIPLES (OTHER
THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK).
7.3 SUBMISSION TO JURISDICTION
For the benefit of MSN, Newco agrees that the state or federal courts
located in or of New York City, New York are to have jurisdiction to settle any
disputes in connection with this Agreement and submit to the jurisdiction of
such courts in connection with this Agreement. Newco further agrees that a final
judgment in any action or proceeding arising out of or relating to this
Agreement will be conclusive and may be enforced in any other jurisdiction
within or outside the United States of America by suit on the judgment, a
certified or exemplified copy of which will be conclusive evidence of the fact
and the amount of the indebtedness or liability therein described, or in any
other manner provided by Law. Newco hereby irrevocably waives, to the fullest
extent permitted by Law, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement brought in any state or federal court in or of New
ADDITIONAL REVENUE SERVICES AGREEMENT
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89
York City, New York, and hereby further irrevocably waives any claim that any
such suit, action or proceeding brought in any state or federal court in or of
New York City, New York has been brought in an inconvenient forum. Nothing in
this Section 7.3 limits the right of MSN to bring proceedings against Newco in
connection with this Agreement in any other court of competent jurisdiction or
concurrently in more than one jurisdiction.
The Parties hereby waive trial by jury in any judicial proceeding to
which they are Parties involving, directly or indirectly, any matter arising out
of or relating to this Agreement.
7.4 PROCESS AGENT; SERVICE OF PROCESS
Newco, at its expense, will maintain the process agent set forth below as
its agent for service of process in the State of New York during the Term and
six months thereafter. Newco hereby irrevocably designates, appoints and
empowers CT Corporation System, with its office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as its authorized agent to receive on its
behalf and on behalf of its property service of copies of the summons and
complaint and any other process which may be served in any action or proceeding
arising out of or relating to this Agreement. Such service may be made by
mailing or delivering a copy of such process in care of the appropriate process
agent set forth above and Newco hereby irrevocably authorizes and directs its
designated process agent to accept such service on its behalf. Newco further
agrees that failure by a process agent appointed in accordance with the
foregoing terms to notify it of the process will not invalidate the proceeding
concerned. Notwithstanding the foregoing, nothing herein will affect the rights
of either Party to serve process in any other manner permitted by Law.
7.5 ASSIGNMENT
This Agreement will be binding on and inure to the benefit of the Parties
and their permitted successors and assigns. Any assignment or delegation of this
Agreement will not relieve the assigning Party of any of its obligations without
the prior written consent of all other Parties. During the term of this
Agreement, Newco may not directly or indirectly assign this Agreement or any
rights hereunder to any Person without the prior written consent of MSN (such
consent not to be unreasonably withheld).
7.6 CONSTRUCTION
This Agreement has been negotiated by the Parties and their respective
counsel and will be interpreted fairly in accordance with its terms and without
any strict construction in favor of or against either Party. The section
headings used in this Agreement are intended for convenience only and shall not
be deemed to affect in any manner the meaning or intent of this Agreement or any
provision hereof.
ADDITIONAL REVENUE SERVICES AGREEMENT
EXECUTION COPY
90
7.7 NOTICES
(a) All notices, requests, demands and determinations under this
Agreement will be in writing, may be delivered by hand, express courier,
confirmed facsimile or mail and will be deemed duly given when received at the
following addresses:
If to MSN, at:
The Microsoft Network L.L.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Tel. No.: ▇▇▇-▇▇▇-▇▇▇▇
Fax No.: ▇▇▇-▇▇▇-▇▇▇▇
Attention: [_______________]
If to Newco, at:
[______________________
_______________________
_______________________]
Tel. No.: ____________
Fax No.: ____________
Attention: [____________]
(b) A Party may from time to time change its address or designee for
notification purposes by giving the other Party prior written notice of the new
address or designee and the date upon which it will become effective.
7.8 ENTIRE AGREEMENT
This Agreement, together with the NDA, constitutes the entire agreement
among the Parties with respect to the subject matter hereof and supersedes all
prior and contemporaneous agreements or communications. This Agreement shall not
be modified except by a written agreement dated subsequent to the date of this
Agreement and signed on behalf of the Parties by their respective duly
authorized representatives. No waiver of any breach of any provision of this
Agreement shall constitute a waiver of any prior, concurrent or subsequent
breach of the same or any other provisions hereof. No waiver shall be effective
unless made in writing and signed by an authorized representative of the waiving
Party.
7.9 COUNTERPARTS
This Agreement may be executed in counterparts which, taken together,
constitute one single contract between the Parties.
[Remainder of page intentionally left blank.]
ADDITIONAL REVENUE SERVICES AGREEMENT
EXECUTION COPY
91
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their duly authorized representatives as of the Effective Date.
THE MICROSOFT NETWORK L.L.C.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
GILAT-TO-HOME, INC.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
ADDITIONAL REVENUE SERVICES AGREEMENT
EXECUTION COPY
92
ANNEX I
MASTER AGREEMENT AMONG STARBAND, GILAT AND SPACENET, INC. DATED
SEPTEMBER 29, 2000
93
[Filed as a separate Exhibit to the Registration Statement]
94
ANNEX J
FORM OF CONFIDENTIALITY AGREEMENT
95
Annex J
CONFIDENTIAL INFORMATION, INTELLECTUAL PROPERTY, AND EXCLUSIVITY UNDERTAKINGS
1. I acknowledge that I am employed by StarBand or its parent, a subsidiary
or an affiliated company (the "Company").
In consideration of my future employment with the Company, I agree as
follows:
a) that during the course of my employment with the Company,
I may come into possession of knowledge or information
which is Confidential Information (as defined below) of
the Company or another party to which the Company has an
obligation of confidentiality;
b) that I will not with out the prior consent of the Company
use, divulge, disclose or make accessible to any other
person or entity any Confidential Information except for
the benefit of the Company, in the proper course of
employment with the Company;
c) that during my employment with the Company and for one (1)
year thereafter, I will not directly or indirectly hire or
solicit for hire any person which is or was a Company
employee in the preceding twelve (12) months or solicit
the business of any customer of the Company for the benefit
of a person or an entity competing with the company;
d) throughout the term of my employment, I will devote my
full time and attention to the business and affairs of the
Company and will not, without the prior written consent of
the Company, Engage in any other business or occupation
for remuneration or become a director, officer, employee,
or agent of any other business without the prior written
approval of the Company;
e) that during the term of my employment and for six (6)
months thereafter, I will promptly disclose to the company
any Inventions (as defined below) which I conceive of or
reduce to practice; I will assign my entire right, title
and interest in all my Inventions to the Company, or its
designee, without further compensation or award; and I
will assist the Company, at the Company's expense, in
securing the benefit of Invention, including making
applications for letters patent, copyrights, trademarks or
taking other actions necessary to establish and perfect
the right, title and interest to the Invention in the
Company, or its designee;
f) that I am not subject to any non-competition or other
restrictions from a previous employer or other party that
could in any way affect the performance of my employment
obligations with the Company and I hereby indemnify the
Company against any costs or damages arising from the
breach of this paragraph (f).
2. Confidential Information means all materials and information which I
received, developed or had access, or will receive, develop or have access to
in the course of employment with the Company including, but not limited to the
Company's production processes, marketing techniques or plans, mailing lists,
customer lists, financial information, strategic business plans, product
development (or other proprietary data), employee lists, discoveries, results
of research and development activities; any information about the Company
which is not generally known to the public or others engaged in similar
business activities; and information concerning customers, vendors or other
transacting business with the Company, including, their manufacturing methods,
processes, techniques, products or research.
3. Invention means all discoveries, improvements, developments, devices,
tools, machines, apparatus, appliances, designs, promotional ideas, practices,
processes, formulas or products, useful in or related to the business of the
Company or a business the Company proposes to engage in, whether patentable,
copyrightable, or otherwise which is made, discovered, conceived, developed or
reduced to practice or secure by me, solely or jointly with others or
otherwise during the term of my employment and for six (6) months thereafter.
4. I agree that all of my obligations under this Agreement will be binding on
my heirs, executors, administrators, assigns or other legal representatives.
Full Name Title
--------------------- ------------------------------------
Social Security Number Department/Location
------------------- ------------------------------
Employee Signature Date
----------------------- ----------------------
96
ANNEX K
TELECOMMUNICATIONS SERVICES AGREEMENT
97
[Filed as part of a separate Exhibit to the Registration Statement]
98
ANNEX L
STATEMENT OF WORK PURSUANT TO TELECOMMUNICATIONS SERVICES AGREEMENT
99
ANNEX L
STATEMENT OF WORK
In accordance with Article l of the Telecommunications Services Agreement,
Spacenet shall provide to Newco uplink and associated satellite transport
services from Spacenet's satellite earth station hubs and the uplink and
reception services of submeter and other Very Small Aperture Terminal (VSAT)
terminals licensed to Spacenet, including access to transmission and switching
facilities necessary to transmit and terminate Newco's telecommunications
traffic to all termination points accessible to Spacenet (the "Spacenet
Services"). The Spacenet Services shall consist of the following:
- The hub stations through which the services will be made available are
located at Spacenet headquarters in McLean, VA and its facilities at
Marietta, Georgia.
- The VSATs will be located at various customer sites throughout the
contiguous United States (and as appropriate in Canada and Mexico).
- Satellite uplink and transmission services utilizing space segment leased
on domestic US satellite(s).
- Transmission and switching facilities arranged with local service
providers, on an as-needed basis.
- The Services shall be available 24-hours-per-day, 365-days-per-year.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
100
SCHEDULE 1
CPE PRICING CHART
STARBAND UNIT PRICE
CPE CPE UNIT RANGE TO MSN
------------------------------------------------------------------------------------------------
Trial Period
Phase:Non-
USB_CPE All $[*]
------------------------------------------------------------------------------------------------
Full Availability
Phase:USB-CPE 1 to 75,000 $[*]
75,001-100,000 $[*]
100,001-150,000 $[*]
150,001-200,000 $[*]
200,001-250,000 $[*]
250,001-300,000 $[*]
300,001 & Beyond $[*]
------------------------------------------------------------------------------------------------
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
101
SCHEDULE 2
WARRANTY PRICING AND INFORMATION CHART
SHIPPING OF
REPLACEMENT UNIT TO SHIPMENT OF FAILED ON-SITE
CONSUMER UNIT BACK TO STARBAND LABOR PRICE PREMIUM
----------------------------------------------------------------------------------------------------------------------------------
Standard 90 Day
Warranty StarBand StarBand Included during the Included in CPE
Trial Period; purchase
thereafter, not
included
----------------------------------------------------------------------------------------------------------------------------------
Extended Warranty: StarBand Consumer Not included
------------------
1 Year Option $[*]
-------------------
2 Year Option $[*]
-------------------
3 Year Option $[*]
-------------------
----------------------------------------------------------------------------------------------------------------------------------
On-Site Services: StarBand StarBand Included
-----------------
1 Year Option $[*]
-------------------
2 Year Option $[*]
-------------------
3 Year Option $[*]
-------------------
----------------------------------------------------------------------------------------------------------------------------------
Out-of-Warranty
Charges See Note 2 Below Consumer Not to exceed Time and Materials
$[*]/hour (cost to MSN Customers
not to exceed [*])
----------------------------------------------------------------------------------------------------------------------------------
Note 1: The On-Site Service option is only available if purchased in
addition to the Extended Warranty Service option.
Note 2: Unit will be replaced at a price not greater than $[*] per MSN
Customer (inclusive of shipping charges).
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions.
