1
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
EXHIBIT 10.7
AGREEMENT
BETWEEN
AT&T COMMUNICATIONS, INC.
AND
STUDENT ADVANTAGE, L.L.C.
AT&T CONFIDENTIAL AND PROPRIETARY
2
TABLE OF CONTENTS
Page
SECTION I DEFINITIONS...................................................2
SECTION II THE AT&T/STUDENT ADVANTAGE PROGRAM AND
COMPANY OBLIGATIONS...........................................4
SECTION III PURCHASE OF MEMBERSHIPS AND PAYMENT...........................6
SECTION V TERM, RENEWAL AND TERMINATION................................15
SECTION VI CONFIDENTIALITY AND PROTECTION OF
INFORMATION..................................................16
SECTION VII INDEMNIFICATION..............................................17
SECTION VIII LIMITATION OF LIABILITY......................................19
SECTION IX OTHER TERMS AND CONDITIONS...................................19
AT&T CONFIDENTIAL AND PROPRIETARY
3
AGREEMENT
BETWEEN
AT&T COMMUNICATIONS, INC.
AND
STUDENT ADVANTAGE, L.L.C.
This Agreement is effective as of February 1, 1997, (hereinafter referred
TO as the "Effective Date") between AT&T COMMUNICATIONS, INC. a Delaware
corporation, with its principal place of business located at 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxx Xxxxx, Xxx Xxxxxx 00000, acting for itself and its affiliates
("AT&T"), and STUDENT ADVANTAGE, L.L.C., a Delaware limited liability company
with its principal place of business located at 000 Xxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 ("COMPANY").
RECITALS
WHEREAS, AT&T operates a telecommunications network in the United States
and around the world, pursuant to which its subscribers may purchase AT&T
services; and
WHEREAS, COMPANY markets a student savings program to high school,
undergraduate and graduate college students which allows members of such program
to purchase goods and services at a discount; and
WHEREAS, AT&T desires to make available to its College Student subscribers
the opportunity to participate in a joint AT&T - Student Advantage program which
permits College Student subscribers to obtain various benefits and discounts
from national and local merchants;
NOW, THEREFORE, in consideration of the mutual provisions contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, AT&T and COMPANY hereby agree as follows:
AT&T CONFIDENTIAL AND PROPRIETARY
4
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
SECTION I
DEFINITIONS
The following definitions will apply to all Sections and Schedules, if
any, of this Agreement.
"AT&T/SA Member" shall mean the AT&T Customer participating in the
AT&T/Student Advantage Program.
"College Student" shall mean any individual enrolled either on a part-time
or full-time basis in any undergraduate, graduate or professional college in the
United States.
"COMPANY Member" shall mean the high school or College Student
participating in the Student Advantage Program.
"Member" shall mean those Customers, as defined below, of AT&T
participating in the COMPANY Offer. The COMPANY Offer is fully described in
Section 11 B of this Agreement and on Attachment C hereto.
"AT&T/Student Advantage Program" shall mean the Student Advantage Program,
represented by the Co-logoed Card instead of the COMPANY membership card, which
permits College Students which are AT&T Customers to obtain, at no charge,
various benefits from local and national merchants in the form of goods,
services and/or discounts thereon.
"Student Advantage Program" shall mean that certain College Student
savings/discount program offered and solely marketed to college and high school
students by COMPANY generally at a retail cost of twenty dollars ($20.00) per
academic year and which is represented by a COMPANY membership card.
"ACUS Program" shall mean the AT&T College and University Systems program
whereby a college or university purchases AT&T Services from AT&T and resells
such services to its college or university students.
"ACUS Student" means those certain college and/or university students
which purchases AT&T Services from a reseller entity participating in the ACUS
Program, for purposes herein, its college or university.
AT&T CONFIDENTIAL AND PROPRIETARY
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"AT&T/Student Advantage Membership Card" means a card furnished to each
AT&T/SA Member containing the Student Advantage and AT&T names and logos, which
shall be used for membership verification purposes in obtaining benefits
available to AT&T/SA Members.
"AT&T Services" means: (i) interstate and/or intrastate, interexchange or
intraexchange, interLATA and/or intraLATA telecommunications services provided
by AT&T which originate and/or terminate in the United States (including Puerto
Rico and the Virgin Islands); (ii) Interstate and/or Intrastate Interlata
cellular telecommunications services provided by AT&T which originate and/or
terminate in the United States; (iii) telecommunications services provided by
AT&T between the United States and international locations (hereinafter referred
to as "International"); (iv) AT&T Long Distance Certificates; (v) Internet
access; or (vi) multichannel video programming (e.g., direct broadcast satellite
services, cable TV services, or MMDS services). Such AT&T Services may be
subject to either (i) Title I or Title II jurisdiction of the Federal
Communications Commission ("FCC") or (ii) the jurisdiction of one or more State
Public Utilities Commissions ("PUC"). For purposes of this Agreement, "LATA"
shall have the same meaning as that term is defined in United States V. Western
Electric Co., 569 F. Supp. 990 (D.D.C. 1983).
"Customer" shall mean all persons, whether in an individual capacity, or
in connection with their business, or otherwise, which meet the Qualifications
used in Section II B. hereto.
"Information" includes marketing philosophies and objectives, competitive
advantages and disadvantages, customer statistics, financial information and
results, and any other information of either Party that the Party may consider
confidential and/or proprietary.
"Party" means: (i) AT&T or (ii) COMPANY; and "Parties" means COMPANY and
AT&T.
"Subscriber" means an AT&T customer who has selected AT&T as the
customer's presubscribed interexchange carrier and/or a customer who uses or
purchases AT&T Services. At AT&T's sole discretion, Subscribers may include AT&T
customers who engage in transactions involving AT&T business long distance
services.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
SECTION II
THE AT&T/STUDENT ADVANTAGE PROGRAM AND
COMPANY OBLIGATIONS
A. COMPANY Obligations
1. During the Term of this Agreement, COMPANY shall use its best
efforts to cause each merchant (collectively, "MERCHANTS") listed in that
certain Directory Guide entitled "AT&T - Student Advantage National Directory",
to be mutually agreed upon between the parties and attached hereto at a later
date as Attachment A, or the "Student Advantage Welcome Package", as applicable,
attached hereto as Attachment B (collectively referred to as the "Directory
Guide"), both as may be amended from time to time, to provide to all AT&T/SA
Members, and those Members participating in the Half Membership, certain goods
and/or services and/or discounts set forth in the Directory Guide (each,
individually, a "MERCHANT Offer"; collectively, the "GROUP Offer"), and to cause
each of the MERCHANTS to perform all fulfillment obligations with respect
thereto. Each MERCHANT Offer and MERCHANTS'/COMPANY's fulfillment obligations
are specified on Attachment C attached hereto and made a part hereof.
2. COMPANY agrees to acquire additional MERCHANTS, on the national
and local levels, to provide certain Benefits, as defined below, in the
AT&T/Student Advantage Program at an increase of either (i) [**], from one
academic year to the next, throughout the Term of this Agreement, or (ii) [**]
in the aggregate, prior to September 1, 1999, for each level - national and
local, over the existing number of MERCHANTS, offered in the 1996 Student
Advantage Program. For purposes of this provision, each type of sponsor level
(national and local), shall be evaluated as a whole, on the national level, and
not evaluated on a market-by-market basis.
As a means of supporting and maintaining the above program growth
requirements, COMPANY shall, on or before September 1, 1997, (i) increase its
existing staff of regional managers by a minimum of [**] full-time employees
dedicated to local merchant acquisition, servicing and promoting the
AT&T/Student Advantage Program and (ii) increase its existing partnership
marketing staff by a minimum of [**] full-time national managers dedicated to
the acquisition and servicing of merchants on the national level.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
In addition, COMPANY shall increase its staff of customer service
representatives by a minimum of [**] full-time customers service representatives
during the months of August through October of each year during the term hereof.
The Parties understand and agree that the number of customer service
representatives may be decreased to no less than [**] full-time customer service
representatives during the months of November through July of each year during
the term hereof as COMPANY in its sole and absolute discretion deems
appropriate.
Commencing on [**] and on or before each subsequent [**] during the Term
hereof, [**] not currently covered by COMPANY which are of particular importance
to AT&T's college marketing efforts. COMPANY agrees to [**] in at least [**] on
AT&T's list [**].
B. AT&T/Student Advantage Program.
AT&T may make available to an AT&T Customer which is (i) enrolled as a
full or part time college student and (ii) either (a) establishes or maintains
its Dial-1 Long Distance Service with AT&T in its name; or (b) requests and
qualifies for an AT&T Universal Card in its name; or (C) requests and qualifies
for an AT&T Direct Billed Calling Card in its name; and which remains in good
credit standing with AT&T (collectively, the "Qualifications"), a membership
free of charge in the Student Advantage Program ("Half Membership") that is
valid through August 31, 1997, or a one-year membership in the AT&T/Student
Advantage Program ("Yearly Membership"), valid throughout the entire academic
year to August 31 for each academic year during the Term hereof, both of which
are provided by Student Advantage through AT&T which enable Members, as defined
below, to obtain various benefits (collectively, "Benefits") in the form of
products and/or services, or discounts thereon. AT&T shall make the Half
Membership available prior to May 1, 1997. The Half Membership and Yearly
Membership shall collectively be referred to as the COMPANY Offer. AT&T reserves
the right to modify and amend the Qualifications for new enrollees, subject to
the prior written approval of COMPANY. The parties shall enter into good faith
negotiations to [**] the membership fee per Yearly Membership, excluding ACUS
Memberships, if the Qualifications become more stringent. AT&T reserves the
right, in its sole and absolute discretion, to eliminate any of the following
product categories from the Qualifications: (i) the establishment or maintenance
of Dial-1 Long Distance Service; (ii) the AT&T Universal Card requirement; or
(iii) the AT&T Direct Billed Calling Card requirement, upon giving [**] days
prior written notice to COMPANY. If AT&T exercises this right, the parties shall
enter into good faith
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
negotiations to [**] the membership fee per Yearly Membership, excluding ACUS
Memberships. In addition, AT&T shall forfeit its right of first refusal to be an
exclusive MERCHANT for each such eliminated product category within the Student
Advantage Program and the AT&T/STUDENT Advantage Program if AT&T does not offer
a substantially similar product in substitution thereof within [**] days of such
elimination.
At any time during the Term hereof, AT&T, at its sole and absolute
discretion, may make Yearly Memberships available to certain ACUS Students. The
Yearly Memberships ACUS Students receive shall be referred to herein as "ACUS
Memberships" and considered part of the COMPANY Offer.
C. COMPANY represents and warrants that the goods and/or services and/or
discounts comprising the Student Advantage Program and the AT&T/Student
Advantage Program are substantially the same as the other, with the exception of
limited-time offers used primarily to drive member acquisition and as such, a
COMPANY Member and a Member, as defined herein, shall receive substantially the
same Benefits. Further, COMPANY agrees to use its best efforts not to engage in
any type of promotional or marketing activities with any company or business
entity primarily engaged in the selling of certain products that have the
potential to harm the reputation and goodwill of AT&T, including, but not
limited to, tobacco, liquor and pornography; provided, however, convenience
stores and similar businesses which sell a large variety of products, including
the above, are typically excluded herefrom.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
SECTION III
PURCHASE OF MEMBERSHIPS AND PAYMENT
X. Xxxxxxxx of Yearly Memberships
1. Commencing with the 1997-1998 academic year, AT&T agrees to
purchase [**] Yearly Memberships per academic year (the [**]).
The [**] may be [**] by AT&T on an as needed basis.
B. Invoicing of Yearly Memberships
1. Commencing on [**], and on a [**] basis thereafter, COMPANY
shall invoice AT&T for [**] the [**] for the upcoming [**]. Commencing on [**],
and on a [**] basis thereafter, COMPANY shall invoice AT&T for [**] the [**] and
commencing on [**], and on a [**] basis thereafter, COMPANY shall invoice AT&T
for the remaining [**] the [**] for the current [**]. AT&T shall pay [**] per
Yearly Membership [**] purchased in accordance herewith.
C. Reconciliation of Yearly Memberships
1. During the Term hereof, the dollar amount paid by AT&T for the
invoices issued on [**] each year for the [**], shall be reconciled two (2)
times per year, or within thirty (30) days upon a termination due to a breach of
this Agreement (a "Breach Reconciliation"), against the dollar amount due
COMPANY for the actual number of Yearly Memberships, excluding ACUS Memberships,
distributed in accordance with this Agreement ("Actual Amount"). [**]. The first
reconciliation shall occur at the beginning of each [**], on or about each [**],
commencing on [**] ("First Reconciliation"), and the second reconciliation shall
occur at the end of the [**], on or about each [**], commencing on [**] ("Second
Reconciliation"). The First Reconciliation shall incorporate a mutually agreed
upon
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
estimate (the "Yearly Estimate") of the number of Yearly Memberships, excluding
ACUS Memberships, expected to be distributed by AT&T for the remainder of the
applicable academic year, which shall be invoiced at the time of the First
Reconciliation. The Second Reconciliation shall refine the Yearly Estimate with
actual data and shall completely reconcile the applicable academic year.
2. If the [**] at the time of the First Reconciliation, or a
Breach Reconciliation, exceeds the [**], COMPANY shall invoice AT&T
for the amount representing the sum of the difference between the [**]
and the [**] (such sum herein referred to as the "Excess")
multiplied by the cost per Yearly Membership, such cost being pursuant to
Attachment D hereto. COMPANY shall also [**].
3. If the [**] at the time of the First Reconciliation is less
than the [**], COMPANY issue a credit to be applied towards the [**] (the
"Credit") in the amount of the sum of the difference between the [**] less the
[**] (such sum herein referred to as the "Shortage") multiplied by [**], or the
cost per Yearly Membership, as applicable. COMPANY shall also apply a [**]
towards the [**] for the [**] for each membership comprising the Shortage.
If the [**] at the time of a Breach Reconciliation is less than the
[**], COMPANY shall issue a cash refund to AT&T within thirty (30) days of such
Breach Reconciliation in the amount of the sum of the Shortage multiplied by
[**], or the cost per Yearly Membership, as applicable.
4. If COMPANY distributes Yearly Memberships, excluding ACUS
Memberships, in excess of the Yearly Estimate during the period between the
First Reconciliation and the Second Reconciliation, COMPANY shall invoice AT&T
for an amount equal to the difference between the number of Yearly Memberships,
excluding ACUS Memberships, and the Yearly Estimate, which amount shall be
multiplied by the cost per Yearly Membership, which amount shall be reduced by
the amount of the Credit, if any. COMPANY shall also [**]. If COMPANY
distributes Yearly Memberships, excluding ACUS Memberships in an amount less
than the Yearly Estimate during the period between the First Reconciliation and
the Second Reconciliation, COMPANY shall issue a cash refund for an amount equal
to the difference between the number of Yearly Memberships, excluding ACUS
Memberships, issued between the First Reconciliation and the Second
Reconciliation and the Yearly Estimate, which amount shall be multiplied by the
cost per Yearly
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Membership, which amount shall be reduced by the amount of the Credit, if any.
COMPANY shall also [**] for each such membership. The cost per Yearly Membership
is set forth on Attachment D hereto.
It is understood that the price per Yearly Membership is based on a
[**] cost structure set forth on Attachment D hereto.
X. Xxxxxxxx of ACUS Memberships
1. AT&T, in its sole and absolute discretion, shall project the
number of ACUS Memberships it expects to distribute to ACUS Students during the
upcoming year (the "Estimate"). AT&T shall notify COMPANY of the Estimate on or
before [**] of each calendar year during the Term hereof and COMPANY shall
invoice AT&T for the Estimate reported. This invoice shall also include [**]
each such ACUS Membership.
E. Reconciliation of ACUS Memberships
1. The dollar amount paid by AT&T for the Estimate shall be
reconciled two (2) times per calendar year, or within thirty (30) days upon a
termination arising out of a breach of this Agreement, against the dollar amount
due for the number of ACUS Memberships distributed to ACUS Students ("ACUS
Actual Amount"). The first reconciliation shall occur [**] on or about each
[**], commencing on [**]; and the second reconciliation shall occur [**], on or
about each [**], commencing on [**].
2. If the ACUS Actual Amount at the time of the [**] Reconciliation,
or a Breach Reconciliation, exceeds the Estimate, COMPANY shall invoice AT&T for
the amount representing sum of the difference between the ACUS Actual Amount and
the Estimate (such sum herein referred to as the "ACUS Excess") multiplied by
[**]. COMPANY shall [**].
COMPANY shall invoice AT&T for the number of ACUS Membership [**]
the costs for each as stated herein, during the period between the [**]
Reconciliation and the [**] Reconciliation. This shall be done at the time of
the [**] Reconciliation.
3. If the ACUS Actual Amount is less than the Estimate at the time
of
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Exchange Commission. Asterisks denote omissions.
the [**] Reconciliation, or at the time of a Breach Reconciliation, COMPANY
shall render a cash refund to AT&T for the dollar amount representing the sum of
the difference between the Estimate and the ACUS Actual Amount ("ACUS
Shortage"), multiplied by [**]. COMPANY shall [**] shall be [**] of the [**]
Reconciliation.
If COMPANY distributes ACUS Memberships during the period between
the [**] Reconciliation and the [**] Reconciliation, COMPANY shall invoice AT&T
on or about each [**], commencing on [**], the sum of [**] during this period.
F. Upon completion of COMPANY's fulfillment of all Half Memberships, as
defined in Attachment C hereto, or sooner if this Agreement is terminated due to
a breach of this Agreement, COMPANY shall [**] for each [**] and AT&T agrees to
pay COMPANY in accordance with the terms and conditions on Attachment D attached
hereto and made a part hereof.
G. All invoices pertaining to the COMPANY Offer are to be forwarded to
AT&T at the address set forth on Attachment D hereto. AT&T agrees to make all
payments in accordance with the terms and conditions as set forth on such
Attachment D.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
SECTION IV
MARKETING AND PROMOTIONAL ARRANGEMENTS
A. Marketing Requirements
1. AT&T and COMPANY mutually agree to market the COMPANY Offer to
certain College Students [**] during the Term of this Agreement. The costs
associated with the marketing of the COMPANY Offer for a particular channel,
including, but not limited to, the price of all marketing materials, shall be as
mutually agreed by the parties.
COMPANY shall promote the COMPANY Offer by using a "Fee or Free", or
comparable, marketing campaign.
COMPANY shall use its best efforts to obtain various prizes and
premiums ("Premiums") from its MERCHANTS for utilization by AT&T and/or COMPANY
in connection with any on-campus tabling or marketing on AT&T's Web Site of the
COMPANY Offer. In exchange for the exposure any MERCHANT or MERCHANTS' name
receives which provide any Premiums used in connection with the marketing of the
COMPANY Offer, such Premiums shall be provided without cost to AT&T.
COMPANY and AT&T each have the right. upon prior written approval of
the other party, and subject to the provisions in this Section IV.A.2. and A.3.,
to market the products and/or services of any MERCHANT to AT&T/SA Members as
they relate to the COMPANY Offer, including any special Benefits a MERCHANT
wishes to offer only to AT&T/SA Members. The parties hereby agree, COMPANY shall
be required to only provide written notice to AT&T, not written approval, if
such marketing efforts (i) relate only to a specific MERCHANT Offer comprising
the COMPANY Offer; and (ii) do not bear any AT&T Marks, as defined below, or any
reference to the COMPANY Offer. Notwithstanding the foregoing, any COMPANY
marketing effort directed to COMPANY Members which are not participants in the
COMPANY Offer do not require AT&T notice or approval.
2. AT&T understands and agrees that all AT&T marketing efforts which
bear the COMPANY or any MERCHANTS' name, any COMPANY or any MERCHANTS'
trademarks or any reference to any of the MERCHANT Offers comprising the COMPANY
Offer are subject to review and approval by COMPANY. COMPANY represents and
warrants that it will obtain the proper authority to use any MERCHANTS' name,
trademarks and/or reference to any MERCHANT Offer for the purposes stated
herein. COMPANY agrees that it will review all such AT&T marketing materials in
a timely fashion and shall notify AT&T in writing of the
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
results of such review within [**] days of receipt of such materials. COMPANY
agrees that approval of the marketing materials shall not be unreasonably
withheld. [**] COMPANY agrees that [**].
3. COMPANY understands and agrees that all marketing efforts which
bear the AT&T trademarks, trade names, logos, color combination, insignia, or
other appropriate marks and slogans (collectively the "AT&T Marks") or any
reference to the COMPANY Offer, are subject to review and approval by AT&T. AT&T
agrees that it will review all such marketing materials in a timely fashion and
shall notify COMPANY in writing of the results of such review within [**] days
of receipt of such materials. AT&T agrees that approval of the marketing
materials shall not be unreasonably withheld. [**] AT&T agrees that [**].
COMPANY agrees to use its best efforts to cause its national
marketing partners to promote the COMPANY Offer in the materials such national
MERCHANTS produce to promote the Student Advantage Program. Such MERCHANTS may
also offer certain Benefits exclusively to AT&T/Student Advantage Members with
the usage of an AT&T Service, that is, Benefits may be Offered to AT&T/Student
Advantage Members which shall not be made available to COMPANY Members. In such
instances, any and all marketing materials which bear any AT&T Marks or any
reference to the COMPANY Offer are subject to AT&T's prior written review and
approval. COMPANY agrees to submit such marketing materials to AT&T and shall
cause each MERCHANT utilizing such marketing materials to obtain prior written
approval from COMPANY before utilizing any such materials. COMPANY agrees not to
permit any MERCHANT to use any AT&T Mark or promote the COMPANY Offer without
obtaining AT&T's prior written consent. AT&T shall review such marketing
materials in accordance with the above. COMPANY represents and warrants that any
such marketing materials which require customer specific Member Information, as
defined in Section IX.J., such as direct mail marketing pieces, shall not be
distributed by any MERCHANT; and agrees to distribute any such marketing
material itself.
4. A. [**].
B. License. AT&T hereby grants COMPANY a [**] non-exclusive
limited license to use the AT&T trademarks, trade names, logos, color
combination, insignia, or other appropriate marks and slogans (collectively the
"AT&T Marks"); provided, however that such use shall be limited to the Term of
this Agreement, shall be solely for the purpose of including AT&T Marks on the
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
AT&T/SA Membership Card and on the marketing materials relating to the COMPANY
Offer and only upon the receipt of AT&T approval pursuant to Section IV.A3.
above. COMPANY agrees that it shall, in no way, contest or deny the validity of,
or the right or title of AT&T or its affiliates in or to the AT&T Marks, and
shall not encourage or assist others directly or indirectly to do so, during the
Term of this Agreement and thereafter. In addition, COMPANY shall not utilize
the AT&T Marks in any manner which would diminish their value or harm the
reputation of AT&T.
COMPANY hereby grants AT&T a [**] non-exclusive limited license
to use the COMPANY trademarks, trade names, logos, color combination, insignia,
or other appropriate marks and slogans (collectively the "XX Xxxxx"); provided,
however that such use shall be limited to the Term of this Agreement, shall be
solely for the purpose of including XX Xxxxx on the AT&T/SA Membership Card and
on the marketing materials relating to the COMPANY Offer and only upon the
receipt of COMPANY approval pursuant to Section IV.2 above. AT&T agrees that it
shall, in no way, contest or deny the validity of, or the right or title of
COMPANY or its affiliates in or to the XX Xxxxx, and shall not encourage or
assist others directly or indirectly to do so, during the Term of this Agreement
and thereafter. In addition, AT&T shall not utilize the XX Xxxxx in any manner
which would diminish their value or harm the reputation of COMPANY.
In addition to placing the XX Xxxxx on the AT&T/SA Membership
Card, COMPANY grants AT&T a [**] non-exclusive limited license to use the XX
Xxxxx on an AT&T multi-purpose college/university student identification card,
if AT&T, in its sole and absolute discretion and subject to the resolution of
several implementation issues, decides to utilize a multi-purpose
college/university student identification card with the AT&T/Student Advantage
Program Capacity. If such a decision is made, the parties herein agree that such
co-logoed multi-purpose identification cards shall not be considered separate
and apart of the Minimum Purchase, but shall be included therein as part of the
total of AT&T's Minimum Purchase commitment and subject to the costs per Yearly
Membership set forth in Attachment D hereto.
C. Ownership of Marks. Ownership of Marks AT&T and COMPANY
understand and agree that except for the rights granted in Section lV.4.B
hereto, nothing in this Agreement creates any right, title or interest in the
names, logos, trade names or trademarks of the other Party, including each of
the MERCHANTS, and that use of the other Party's names, logos, trade names, or
trademarks including those of any MERCHANTS shall inure to the benefit of the
owner of such name, logo, trade names or trademarks.
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D. Exclusivity
1. COMPANY agrees that it shall not, prior to the expiration or
termination of this Agreement, enter into promotional or marketing activities
with respect to the Student Advantage Program or the AT&T/Student Advantage
Program with (a) any college or university, or (b) any company or business
entity primarily engaged in providing (1) the extension of uninsured credit
directly to consumers via credit cards; (2) intralata cellular
telecommunications services which originate and/or terminate in the United
States; (3) multi-purpose college/university student identification cards;
and/or (4) products or services similar to the AT&T Services as described in
(i), (ii), (iii), (iv), (v) or (vi) of the definition of AT&T Services.
COMPANY's existing Agreement with Teledata World Services, Inc. ("Teledata")
entered into in April, 1996 (the "Teledata Agreement"), whereby COMPANY utilizes
AT&T and MCI long distance telecommunications services purchased from Teledata
on COMPANY's pre-paid calling card is specifically excluded herefrom. If COMPANY
and AT&T enter into an Agreement whereby COMPANY utilizes AT&T Service for the
prepaid calling card capability on the COMPANY Card, as provided for in Section
1 (A) of Attachment C hereto, COMPANY represents and warrants that upon entering
negotiations with AT&T, it shall serve notice on Teledata of its intent to
terminate the Teledata Agreement and that ninety (90) days thereafter, the
Teledata Agreement shall terminate and COMPANY shall cease its relationship with
Teledata. COMPANY further represents and warrants that COMPANY has a contractual
right to terminate the Teledata Agreement as stated above. If AT&T cannot
provide the AT&T Service as provided for in Section 1 (A) of Attachment C
hereto, nothing herein shall preclude COMPANY from offering a pre-paid calling
card capability on its COMPANY Card utilizing the long distance service of a
third party telecommunications provider.
2. A. COMPANY hereby grants AT&T the right of first refusal to
replace any existing telecommunications MERCHANTS, including those which provide
cellular services, or credit card MERCHANTS in the Student Advantage Program.
B. COMPANY hereby grants AT&T the right of first refusal to
be the exclusive provider of Internet access and multichannel video programming
as a MERCHANT in its Student Advantage Program and in the AT&T/Student Advantage
Program, should COMPANY wish to provide such Benefits. If AT&T cannot offer such
services at competitive market terms, nothing herein shall preclude COMPANY from
utilizing the services of a third party provider. For purposes of this
Agreement, competitive market terms shall mean those terms which are of the
industry standard.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
C. COMPANY hereby grants AT&T the right of first refusal to
act as the exclusive provider as a MERCHANT of any new products or services
within the areas of telecommunications, multi-purpose college/university student
identification cards or credit cards. If AT&T does not offer such products
and/or services or cannot provide such products and/or services at competitive
terms, nothing herein shall preclude COMPANY from utilizing the services of a
third party provider.
AT&T shall have [**] to make an offer to COMPANY for the products
and/or services set forth in Sections IV.A.4.D.2.B. and C. above.
D. COMPANY hereby grants AT&T the right of first refusal to be the
exclusive provider as a MERCHANT in the following product categories: (i) Dial-1
Long Distance Service; (ii) credit cards; and (iii) direct billed calling cards.
3. During the Term of this Agreement, COMPANY shall not allow any third
party to offer a Student Advantage Program membership to College Students free
of charge as an incentive or through any promotion, with the exception of
COMPANY's current marketing programs with The Princeton Review, Delta Air lines,
Inc. and Novus Services, Inc.; provided, however, that COMPANY shall not extend
or renew such programs beyond their current terms. Nothing contained herein
shall preclude COMPANY from allowing a third party to offer a Student Advantage
Program membership to high school students free of charge as an Incentive or
through a promotion; provided, however, COMPANY shall not grant such third party
any type of exclusivity that would preclude AT&T from extending the COMPANY
Offer or similar offer to high school students free of charge.
4. It is understood by AT&T and excepted from this Exclusivity Clause,
that various College Student associations (an "Association") may offer a Student
Advantage Membership for no additional charge if a student joins such an
Association and pays an Association membership fee; provided, however, that
COMPANY shall not allow any such Association to promote, advertise or market the
Student Advantage Membership as "free", at "no charge" or to use any similar
language and shall require that any such Association dearly state that the
Student Advantage Membership is included as part of the Association's membership
fee.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
5. Subject to Section IV.D.1. herein, COMPANY may market memberships in
its Student Advantage Program to high school and College Students at the
suggested retail price of twenty dollars ($20.00) per academic year. It is
understood by the parties herein that the price per academic year [**] per
academic year.
SECTION V
TERM, RENEWAL AND TERMINATION
A. Term
This Agreement is effective on the Effective Date, and shall expire
June 1, 2000 (the "Initial Term"), unless earlier terminated as provided in this
Agreement.
AT&T shall have an option to renew this Agreement for an additional
two (2) year term at substantially the same terms, and with no more than a [**]
to the cost of each Yearly Membership and ACUS Membership. AT&T shall notify
COMPANY in writing of its intent to exercise such option no sooner than March 1,
1999 and no later than June 1, 1999.
B. Termination
1. AT&T may terminate this Agreement at any time during the Term
hereof if Xxxxxxx Xxxxx either (i) ceases to be employed by COMPANY as
President, or in a comparable position, or (ii) no longer maintains a minimum of
five percent (5.00%) ownership interest in COMPANY. Written notice of such
occurrence must be given to AT&T within thirty (30) days of such occurrence and
if AT&T Chooses to exercise this option, AT&T shall so notify COMPANY in
writing. All obligations between the parties shall continue until [**] in which
the termination occurs, at which time, all obligations and liabilities,
including those relating to the Minimum Purchase and the costs set forth in
Section D of Attachment D shall cease and terminate in accordance herewith.
AT&T may terminate this Agreement without cause on at least one
hundred twenty (120) days' prior written notice to COMPANY without further
obligation or liability to COMPANY, except for AT&T's obligation to pay COMPANY
the costs set forth in Section D of Attachment D hereto for the remainder of the
Initial
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
Term. The parties understand and agree that AT&T's total obligation to pay the
costs in Section D of Attachment D hereto shall not exceed [**]. All other
obligations between the parties shall cease and terminate in accordance
herewith. Notwithstanding the foregoing, if AT&T terminates this Agreement
during [**], all obligations between the parties shall continue until [**] in
which the termination occurs.
2. Either Party may terminate this Agreement in the event that the
other Party materially breaches this Agreement and fails to cure such breach
within [**] days after receipt of written notice of such breach from the
non-breaching Party identifying the breach and requiring that it be remedied.
Notwithstanding the foregoing, COMPANY acknowledges that all
Memberships fulfilled in connection with the COMPANY Offer which have not
expired shall be honored and remain in effect and shall not be affected in any
way by this Termination Section.
SECTION VI
CONFIDENTIALITY AND PROTECTION OF INFORMATION
A. Except as otherwise provided in this Agreement, any Information that is
furnished, made available, or otherwise disclosed by one Party ("Disclosing
Party") to the other Party ("Receiving Party") in consequence of the existence
of this Agreement, shall be deemed and remain the property of the Disclosing
Party.
B. Unless Information was previously known to the Receiving Party free of
any obligation to keep it confidential, or has been or is subsequently made
public by any act not attributable to the Receiving Party, or has been agreed by
the Disclosing Party in writing not to be regarded as confidential, and if the
Information is marked as "confidential" or "proprietary" by an appropriate
xxxxx, xxxx, or label thereon, or if orally disclosed, summarized in writing by
the Disclosing Party, stamped or marked as "confidential" or "proprietary" and
delivered to the Receiving Party within ten (10) business days after such
disclosure, it shall be deemed Confidential Information of the Disclosing Party
and shall be held in confidence by the Receiving Party and shall be disclosed by
the Receiving Party only to those of its employees who have a need for such
Confidential Information to carry out this Agreement.
AT&T CONFIDENTIAL AND PROPRIETARY
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20
Except as the Parties may otherwise agree in writing, Confidential Information:
(a) shall be used only for the purpose of performing under this Agreement; (b)
shall not be reproduced or copied, in whole or in part, except as necessary for
use as authorized herein; and (c) shall, together with any copies thereof, be
returned or destroyed when no longer needed or upon the termination or
expiration of this Agreement, whichever occurs first.
C. Confidential Information may be provided to third parties only upon
written authorization of the Disclosing Party. Any third party to which
Confidential Information is provided pursuant to such authorization of the
Disclosing Party must agree in writing (a copy of which writing will be
furnished to the Disclosing Party at its request) to the conditions respecting
use of Confidential Information contained in Section VI (A) through (E) of this
Agreement.
D. The Receiving Party shall give prompt notice to the Disclosing Party of
any demand by any third party to provide Confidential Information under lawful
process prior to furnishing Confidential Information, and shall cooperate in
seeking reasonable protective arrangements requested by the Disclosing Party. In
addition, the Receiving Party may provide Confidential Information of the
Disclosing Party requested by a government agency having jurisdiction over the
Receiving Party, provided prompt notice of such request is given to the
Disclosing Party and that the Receiving Party uses its best efforts to obtain
protective arrangements satisfactory to the Disclosing Party, and provided
further that the Disclosing Party may not unreasonably withhold approval of the
protective arrangements.
E. The Disclosing Party shall have the right to demand, upon unauthorized
disclosure of any Confidential Information by the Receiving Party to a third
party, the return of all Confidential Information disclosed to the Receiving
Party, and that the Receiving Party use its reasonable efforts to obtain the
return from the third party of all Confidential Information improperly
disclosed, in addition to any other legal or equitable remedies the Disclosing
Party may have.
F. The Parties acknowledge that the terms of this Agreement constitute
Confidential Information that may be considered proprietary by either or both
Parties, and agree to limit distribution of this Agreement to those individuals
in their respective organizations with a need to know the contents of this
Agreement.
AT&T CONFIDENTIAL AND PROPRIETARY
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21
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
SECTION VII
INDEMNIFICATION
A. To the extent not prohibited by law, each Party ("Indemnifying Party")
shall defend, indemnify and hold harmless the other Party ("Indemnified Party")
against any loss, cost, claim, liability, damage or expense (including
reasonable attorneys' fees) relating to or arising out of:
1. the negligence or misconduct of the Indemnifying Party, its
employees, agents, or contractors in the performance of this Agreement,
Including without limitation with respect to provision of the underlying service
to customers ("AT&T Service" in the case of AT&T, and the products supplied by
any MERCHANT or the products and/or services provided by COMPANY in the case of
COMPANY); or
2. any failure of performance by the Indemnifying Party of its
obligations under this Agreement; PROVIDED, however, that the liability of the
Indemnifying Party for any loss, cost, claim, injury, liability, damage, or
expense (including reasonable attorneys' fees), relating to or arising out of
any act or omission (not involving gross negligence or knowing and willful
misconduct) by the Indemnifying Party or its employees, agents, or contractors
will be limited to the amount of the [**] actually incurred as a result of such
act or omission.
B. In addition, to the extent not prohibited by law, COMPANY shall
indemnify AT&T for any loss, cost, claim, liability, damage and expense
(including reasonable attorneys' fees) relating to or arising out of any
MERCHANTS' activities related to performance of this Agreement.
C. In addition, COMPANY agrees to, at all times, defend, Indemnify and
hold AT&T, its affiliates, subsidiaries, franchisees and the officers,
directors, agents and employees of each harmless from and against any and all
Loss arising out of or based on: any claims, actions or proceedings, and any
appeal, for libel, slander, invasion of privacy, infringement of copyright or
license, piracy, plagiarism, idea misappropriation or unfair or improper trade
practices or other wrongful business conduct, including, without limitation,
conduct in violation of the laws and regulations of the Federal Trade Commission
and analogous state agencies, by reason of: (a) the use of the Student Advantage
Marks approved by COMPANY pursuant to this Agreement in the broadcast, telecast
or publication of promotional materials used in connection with the AT&T/Student
Advantage Program or AT&T's marketing of the COMPANY Offer; or (b) COMPANY
supplied broadcast, telecast or publication of promotional materials used in
connection with the AT&T/Student Advantage Program or the COMPANY Offer.
AT&T CONFIDENTIAL AND PROPRIETARY
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22
D. The Indemnifying Party shall defend any action or suit brought against
the Indemnified Party for any loss, cost, claim, liability, damage or expense
including reasonable attorneys' fees relating to or arising out of the
performance of this Agreement. The Indemnified Party shall notify the
Indemnifying Party promptly in writing of any written claims, lawsuits or
demands for which the Indemnified Party alleges that the Indemnifying Party is
responsible under this Section VII. The Indemnified Party shall cooperate in
every reasonable manner with the defense or settlement of such claim, demand, or
lawsuit the Indemnifying Party shall not be liable under this Section VII for
settlement by the Indemnified Party of any claim, demand or lawsuit unless the
Indemnifying Party has approved the settlement in advance or unless the defense
of the claim, demand or lawsuit has been tendered to the Indemnifying Party in
writing and the Indemnifying Party has failed promptly to undertake the defense.
E. No claims for indemnity under this Section VII hereof may be made more
than two (2) years after the right to recover under the foregoing indemnity
provisions arise.
SECTION VIII
LIMITATION OF LIABILITY
A. Except as set forth in Section VII hereof, the liability, if any, of
either Party to the other for any loss, cost, claim, injury, liability, damage
or expense (including reasonable attorneys' fees) arising out of in the
performance of or failure to perform its obligations under this Agreement shall
be limited to the amount of direct damages actually incurred. EXCEPT AS PROVIDED
IN SECTION VII B HEREOF, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES OF ANY KIND
WHATSOEVER, INCLUDING LOST PROFITS, EVEN IF ADVISED OF THE POSSIBILITY THEREOF.
B. No claim under this Section VIII, or any other claims with respect to
this Agreement, may be made more than two (2) years after the date of the event
giving rise to such claim; provided, however, that claims for indemnity under
the provisions of Section VII hereof may be made within two (2) years after the
right to recover under such indemnity provisions arises.
AT&T CONFIDENTIAL AND PROPRIETARY
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23
SECTION IX
OTHER TERMS AND CONDITIONS
A. Governing Law
This Agreement shall be deemed to be a contract made under the laws
of the State of New York, and the construction, interpretation and performance
of this Agreement shall be governed by the laws of such State.
B. Responsibilities Of Each Party
Each Party is an independent contractor, and has and hereby retains
the right to exercise full control of and supervision over its own performance
of its obligations under this Agreement and retains full control over the
employment, direction, compensation and discharge of all employees assisting in
the performance of such obligations.
C. Force Majeure
Neither Party shall be liable for any delay or failure in
performance of any part of this Agreement caused by a force majeure condition,
including fires, strikes, embargoes, explosions, power blackouts, earthquakes,
volcanic actions, floods, wars, water, the elements, labor disputes, civil
disturbances, government requirements, civil or military authorities, acts of
God or a public enemy, inability to secure raw materials, inability to obtain
transportation facilities, acts or omissions of transportation common carriers
or other causes beyond its reasonable control, whether or not similar to the
foregoing conditions. If any force majeure condition occurs, the Party whose
performance fails or is delayed because of such force majeure condition shall
give prompt notice to the other Party, and upon cessation of such force majeure
condition, shall give like notice and commence performance hereunder as promptly
as reasonably practicable.
D. Governmental Compliance
Each Party shall comply with all applicable federal. state, country
and local laws, regulations and codes and obtain permits and certificates where
needed.
E. Certain State And Local Taxes
Any state or local excise, sales, or use taxes (excluding any taxes
on income) resulting from the performance of this Agreement shall be borne by
the Party upon which the obligation for payment is imposed under applicable law,
even
AT&T CONFIDENTIAL AND PROPRIETARY
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24
If the obligation to collect and remit such taxes Is placed upon the other
Party. Any such taxes shall be billed as separate items on applicable billing
documents between the Parties. To the extent permitted by applicable law, the
Party so obligated to pay any such taxes may contest the same in good faith and
shall be entitled to the benefit of any refund, provided that such Party cannot
permit any lien to exist on any assets of the other Party by reason of any such
contest.
F. Publicity And Filings
The Parties shall mutually agree upon the content of any public
announcement that they may deem appropriate concerning this Agreement. Subject
to the provisions of the section entitled Confidentiality and Protection of
Information, the foregoing sentence shall in no way prevent either Party from
supplying such information or making such statements relating to this Agreement,
as may be required by any competent governmental authority, or as either Party
may consider necessary in order to satisfy its legal obligations. It is
understood that applicable law may require the Parties to file this Agreement
with governmental authorities. The Parties shall undertake, to the extent
permitted by applicable law, to protect the proprietary nature of certain
provisions of this Agreement as agreed by the Parties when making such filings.
G. Amendments; Waivers
Except as otherwise provided in this Agreement, no amendment or
waiver of any provision of this Agreement, and no consent to any default under
this Agreement, shall be effective unless the same is in writing and signed by
an officer of the Party against whom such amendment, waiver or consent is
claimed. In addition, no course of dealing or failure of a Party strictly to
enforce any term, right or condition of this Agreement shall be construed as a
waiver of such term, right or condition.
H. Notices
Unless otherwise provided herein, all notices, requests and other
communications required or provided for hereunder shall be in writing (including
telecopy or similar teletransmission or writing) and shall be given at the
following addresses:
AT&T CONFIDENTIAL AND PROPRIETARY
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25
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
(1) If to COMPANY:
President
Student Advantage, L.L.C.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: 000-000-0000
(2) If to AT&T:
District Manager
AT&T College MSO
AT&T
000 Xxxxx Xxxxx Xxxxxx, 0000X0
Xxxxxxx Xxxxx, Xxx Xxxxxx 00000
Fax: 000-000-0000
Any such notice, request or other communication shall be effective (i) if given
by mail, upon the earlier of receipt or the third business day after such
communication is deposited in the United States mails, registered and certified,
with first class postage prepaid, addressed as aforesaid or (ii) if given by any
other means including, without limitation, by air courier, when delivered at the
address specified herein. COMPANY and AT&T may change its address for notice
purposes by notice to the other Party in the manner provided herein.
I. Assignment
No assignment of this Agreement shall be made by either party
without the written consent of the other party; provided, however, that such
consent is not required when the proposed assignment is to be made to any
parent, subsidiary or parent, affiliate or successor of AT&T. [**]. In the event
of any other assignment made with the written consent of the other party, the
assignee shall assume all liability of the assignor.
J. Exchange of Information
At various times during the Term of this Agreement, AT&T shall [**].
COMPANY may use such information only for (I) its own internal analytical
purposes for the
AT&T CONFIDENTIAL AND PROPRIETARY
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26
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
purpose of providing limited redemption information to MERCHANTS as indicated
below; (ii) the purpose of marketing the products and/or services of a MERCHANT
or special MERCHANT offer as provided for in Section IV.A.1. herein; and (iii)
purposes of storing and providing the information to AT&T as indicated below.
Such information shall be considered confidential and proprietary and subject to
the terms and conditions set forth in Section VI of this Agreement.
AT&T shall [**]. In addition, AT&T, in its sole and absolute discretion,
[**]. It is expressly understood and agreed that the Member Information and
Additional Member Information shall not contain any usage information, that is,
it shall not contain or in any way indicate the frequency at which a Member has
utilized, or the amount of usage a Member has generated with respect to, an AT&T
Service. The Member Information and Additional Member Information AT&T provides
COMPANY is based upon the Information a College Student discloses to AT&T and
therefore, it is understood by COMPANY, that such information may be incomplete
or inaccurate.
At anytime during the Term hereof, AT&T shall have the right to utilize
the Member Information and Additional Member Information in the COMPANY Database
for marketing and analytical purposes. Within thirty (30) days of AT&T's
request, COMPANY shall provide AT&T with the requested data. [**], COMPANY shall
provide AT&T,[**]. AT&T shall [**].
COMPANY shall not sell, lease or distribute the information
contained in the COMPANY Database to any third party, nor shall COMPANY permit
any third party access to the COMPANY Database. Notwithstanding the foregoing,
the parties agree that COMPANY may provide MERCHANTS with analytical information
consisting only of the number of Members which have utilized a particular
MERCHANT Offer, the GROUP Offer, or which are participating in the COMPANY
Offer. It is expressly agreed that such analytical information provided to
MERCHANTS shall not be in any way customer specific by indicating any Members'
name, address or telephone number, or distinguished by the type of AT&T
Service(s). Further, the information provided to MERCHANTS shall not indicate
that any Member is an AT&T Customer. In addition, COMPANY may provide a MERCHANT
with the names, addresses and telephone numbers only of Members which have
redeemed the particular MERCHANT's Offer; provided, however, that such
information may only be provided upon COMPANY's demonstration that a written
Agreement exists between the MERCHANT and COMPANY which requires such Member
Information to be kept confidential pursuant to the terms and conditions of
Section VI hereof, not distributed, sold or leased to any third party and
returned to COMPANY upon the earlier of the termination or expiration of either
this Agreement or the Agreement between COMPANY and the MERCHANT.
AT&T CONFIDENTIAL AND PROPRIETARY
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27
COMPANY shall use its best efforts to obtain redemption information,
including, but not limited to, usage and related statistical data pertaining to
the COMPANY Offer, accrued by MERCHANTS and shall supply AT&T with all such
redemption information it receives. Such redemption information shall be
considered confidential and proprietary and subject to the terms and conditions
of Section VI hereof.
K. No Rights To Third Parties
This Agreement shall not be deemed to provide third parties with any
remedy, claim, right of action or other right.
Subject to the above restrictions, the provisions of this Agreement
shall be binding upon and shall inure to the benefit of the Parties and their
permitted assigns and successors.
L. Entire Agreement
This Agreement constitutes the entire agreement between the Parties
concerning the subject matter hereof. Any prior agreements, representations,
statements, negotiations, understandings, proposals and undertakings, oral or
written, with respect to the subject matter expressly set forth in herein, not
heretofore terminated, are hereby terminated.
M. Survival of Obligations
Any liability or obligation of a Party to the other Party for acts
or omissions prior to the cancellation or termination of this Agreement, any
obligation of a Party under the provisions of the section entitled
Indemnification, Confidentiality and Protection of Information, Limitation of
Liability and any other provisions of this Agreement which, by their terms are
contemplated to survive (or to be performed after) termination of this
Agreement, including, but not limited to, the provisions pertaining to the
Breach Reconciliation and any payment and/or refund provisions set forth in
Section III hereto, shall, in each case, survive cancellation or termination
hereof.
N. Executed In Counterparts
This Agreement may be executed in any number of counterparts, each
of which shall be an Original; but such counterparts shall together constitute
one and the same instrument.
O. Headings
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28
The headings of Articles and Sections of this Agreement have been
inserted for convenience of reference only, and are not to be considered a part
hereof, and will in no way define, modify or restrict the meaning or
interpretation of the terms or provisions of this Agreement.
AT&T CONFIDENTIAL AND PROPRIETARY
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IN Witness WHEREOF, the Parties have executed this Agreement through their
authorized representatives.
STUDENT ADVANTAGE, L.L.C.
By: /s/ Xxxxxxx X. Xxxxx, Xx.
--------------------------------------
Name
President
--------------------------------------
Title
5/22/97
--------------------------------------
Date Signed
AT&T COMMUNICATIONS, INC.
By: /s/ X.X. XxXxxxxx
--------------------------------------
Name
Executive VP-Consumer Markets Division
--------------------------------------
Title
5/19/97
--------------------------------------
Date Signed
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT C
COMPANY OFFER AND FULFILLMENT OBLIGATIONS
1. (A) (i) Commencing on February 1, 1997 through and including May 1,
1997, COMPANY shall provide to AT&T for certain Customers attending college, and
which meet the Qualifications with a free membership ending on August 31,1997 in
COMPANY's Student Advantage Program ("Half Membership"); and (ii) commencing on
August 1, 1997 and continuing through the remainder of the Term of this
Agreement, COMPANY shall provide to AT&T for certain Customers attending
college, and which meet the Qualifications, and certain ACUS Students, with a
free membership that is valid for the entire current academic year through
August 31st of each academic year, in the AT&T/Student Advantage Program
("Yearly Membership"), each of which membership enables any Customer that
presents an AT&T/Student Advantage Membership Card ("Co-logoed Card") or
COMPANY's Student Advantage Membership Card ("COMPANY Card"), as applicable, at
the MERCHANTS' locations, to receive a percentage discount ranging from [**], or
a monetary discount, off of certain products or services offered by MERCHANTS,
or free merchandise with purchase at MERCHANTS' locations (each offer,
individually, a "MERCHANT Offer"; collectively, a GROUP Offer"). The Half
Membership and Yearly Membership shall collectively be referred to as the
COMPANY Offer.
Yearly Memberships shall initially be provided to all of AT&T's current
Universal Card Customers and Direct Billed Calling Card Customers which meet the
Qualifications. AT&T shall determine a Customer's eligibility based on
information contained in its own database. AT&T shall [**].
As of the Effective Date of this Agreement, the COMPANY Card has a
pre-paid calling card capability. If COMPANY continues to offer this capability
as an Option on its COMPANY Card, on or before March 1, 1997, and every March
1st during the Term hereof, COMPANY hereby grants AT&T the right of first
refusal to provide AT&T Service to COMPANY for such capability at competitive
market terms. During the Term of this Agreement, AT&T, in its sole and absolute
discretion, reserves the right to place or withdraw a pre-paid calling card
capability on the Co-logoed Card utilizing AT&T Service. AT&T shall reimburse
COMPANY for any incremental costs incurred by COMPANY as a result of AT&T's
decision to place or withdraw a prepaid calling card capability on the Co-logoed
Card.
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31
(B) AT&T, at its expense and in its sole and absolute discretion,
may provide each College Student wishing to participate in the COMPANY Offer
with a temporary Student Advantage membership card. Such temporary membership
card shall be valid for approximately one (1) month and each temporary
membership card shall state the specific validation dates. If AT&T subsequently
determines that a Customer does not meet the Qualifications, AT&T shall so
notify such Customer. COMPANY shall provide such temporary Student Advantage
memberships to AT&T without charge, however AT&T shall assume the cost related
to the design and production of such temporary membership cards.
(C) All costs associated with the design, development and printing
of the COMPANY Card for the COMPANY Offer shall be the sole responsibility of
COMPANY. AT&T, at its expense, shall design and develop the Co-logoed Card for
the COMPANY Offer, such design being subject to COMPANY's written approval
pursuant to the terms and conditions set forth in Section IV A.2 of this
Agreement. COMPANY, at its expense, shall print such Co-logoed Card. For
purposes of this Agreement, the Customers participating in the COMPANY Offer
shall be referred to as "Members". A majority of the type of discount and a
listing of the MERCHANTS available to those Members participating in the
AT&T/Student Advantage Program are set forth in that certain Directory Guide
entitled "AT&T - Student Advantage National Directory" incorporated herein by
reference and made a part hereof and as may be amended from time to time. A
majority of the type of discount and listing of the MERCHANTS available on a
national basis to those Members participating in the Half Membership are set
forth in a directory guide entitled "Student Advantage Welcome Package" printed
at COMPANY's expense. Both directory guides referred to herein (collectively
referred to as the "Directory Guide") shall contain the majority of MERCHANT
Offers available at the national level and a sampling of the MERCHANT Offers
available on a local level to Members at the time of membership or participation
in the COMPANY Offer. COMPANY, at its expense, shall inform Members, either via
its web site or direct mail piece(s), of all new MERCHANT Offers subsequent to
the publication of the Directory Guide. Each MERCHANT Offer shall be exclusive
of any additional verification that the individual presenting the Co-logoed Card
or COMPANY Card, as applicable, is a member of the AT&T/Student Advantage
Program or the Student Advantage Program. This provision does not preclude
MERCHANTS from also requiring the presentation of a valid college identification
card.
AT&T CONFIDENTIAL AND PROPRIETARY
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32
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
(D) Renewals for subsequent free Yearly Memberships shall be
automatic if a Member retains its College Student status and possess the
Qualifications [**]:
(i) [**];
(ii) [**]
(iii) [**].
AT&T, in its sole and absolute discretion, may also offer certain
ACUS Students retaining the ACUS Student status a subsequent free one (1) year
renewal. AT&T, in its sole and absolute discretion, shall determine the terms of
eligibility of each of the Members for such renewals. AT&T, in its sole and
absolute discretion, reserves the right to modify the Qualifications, subject to
the prior written approval of COMPANY.
On or before [**], and on or before every [**] of each subsequent
year, AT&T shall supply COMPANY with the Member Information of those Customers
eligible for renewal Yearly Memberships and COMPANY agrees to provide a Yearly
Membership to each such Customer in accordance herewith.
2. The Term of this Agreement is February 1, 1997 to June 1, 2000.
3. College Students wishing to participate in the COMPANY Offer may
contact COMPANY directly via a toll-free telephone number established and
maintained by COMPANY, currently 000-000-0000. If COMPANY, in its sole and
absolute discretion, determines that a toll-free telephone number for purposes
exclusive to the COMPANY Offer is necessary, it shall so establish, maintain and
communicate to customers such toll-free telephone number. COMPANY shall provide
Customers wishing to participate herein with AT&T's toll-free telephone number,
000-000-0000 and instruct each such College Student to contact AT&T directly.
Alternatively, certain College Students may also contact AT&T directly via
returning to AT&T a completed application provided to certain College Students
by AT&T via direct mail marketing materials or as distributed on college
campuses. AT&T, in its sole and absolute discretion, shall determine the
eligibility of the applying College Student(s). If a College Student does not
qualify for the COMPANY Offer. AT&T shall so notify such non-qualifying student
within [**] days of application receipt COMPANY expressly represents and
warrants that it has no
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
authority to perform telemarketing duties on behalf of AT&T or to provide
information about AT&T or any AT&T service pursuant to this Agreement and as
such, such information shall not be provided and no outbound telemarketing
services shall be performed by COMPANY.
4. Upon AT&T's determination of a Customers eligibility for
participating in the COMPANY Offer, AT&T shall, on an as needed basis, but no
more frequent than [**] and no less frequent than [**], provide COMPANY, via a
mutually agreed upon electronic format, with the Member Information for each
qualified College Student COMPANY needs to fulfill the COMPANY Offer. AT&T shall
provide such information to COMPANY commencing on or before September 1, 1997
and shall continue throughout the Term of this Agreement. Within [**] days of
receiving the Member Information from AT&T, COMPANY shall distribute to each
Member receiving a Yearly Membership: (i) a co-logoed Welcome Letter, (ii) the
Co-logoed Card, (iii) a Directory Guide, applicable to the Yearly Membership, of
MERCHANTS and up to two (2) promotional/advertising inserts placed on the inside
covers of the applicable Directory Guide promoting AT&T products and services,
(iv) promotional one-time offers from COMPANY, and, in applicable market areas,
(v) a listing of local MERCHANTS relevant to the college or university that the
Member attends ("Yearly Fulfillment Kit") via third class US Mail. It is
expressly understood and stated that the Yearly Fulfillment Kit for an ACUS
Membership ("ACUS Fulfillment Kit") shall not contain a Directory Guide, this,
however, shall not preclude Members from participating in any MERCHANT Offer.
COMPANY shall distribute to each of the Members receiving a Half Membership
("Half Fulfillment Kit") (i) a Cologoed Welcome Letter, (ii) the Co-logoed Card,
and (iii) a directory guide entitled Student Advantage Welcome Package, listing
the national MERCHANTS. The Yearly Fulfillment Kit, Half Fulfillment Kit and
ACUS Fulfillment Kit shall collectively be referred to as the "Fulfillment Kit".
COMPANY shall design, develop and print the components of the Fulfillment Kit,
except the Co-logoed Card and the promotional/advertising inserts for AT&T
products and services, both of which AT&T shall design and develop, and shall
distribute one (1) Fulfillment Kit to each Member. AT&T shall [**]. If both
parties agree [**] in accordance with this Agreement [**]. COMPANY shall direct
such invoice to the address as set forth on Attachment D hereto.
5. Members may take advantage of any MERCHANT Offer as often as
Member chooses during the Term of this Agreement provided that Member complies
with all terms and conditions listed In this Attachment C.
AT&T CONFIDENTIAL AND PROPRIETARY
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Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
6. As stated in Section VII B hereof, AT&T shall have no liability
for, and COMPANY shall indemnity AT&T for, any claims against AT&T related to
the activities of any of the MERCHANTS.
7. COMPANY shall be directly responsible for any MERCHANTS' breach
of this Agreement, including, but not limited to, any MERCHANTS' failure to
fulfill a MERCHANT Offer. Should any Member be unsatisfied with any product,
service and/or discount in connection with the GROUP Offer or the COMPANY Offer,
such Member may contact COMPANY directly via the toll-free telephone number
established and maintained by COMPANY, as stated herein, and COMPANY shall use
its best efforts to remedy the complaint of the Member. The toll free telephone
number for this purpose shall be distributed to Members in the Fulfillment Kit.
On a weekly basis, COMPANY shall provide to AT&T the name and telephone number
of each Member which has registered a complaint, the nature of each complaint
and the resolution of each complaint. Upon AT&T's request, COMPANY shall
establish and maintain a different toll-free telephone number for all purposes
relating to the COMPANY Offer and upon its establishment, COMPANY shall commence
distribution of such new telephone number in all Fulfillment Kits issued.
8. Nothing contained herein shall preclude COMPANY from marketing
its one (1) year Student Advantage Program through COMPANY's existing channels;
provided, however, that COMPANY shall not market the Student Advantage Program
for less than twenty dollars ($20.00) per academic year, [**] as provided for
herein. Further, COMPANY shall [**].
9. COMPANY shall provide AT&T on a monthly basis with information
mutually agreed upon by the Parties relating to the COMPANY Offer and the GROUP
Offer.
10. COMPANY, with the assistance of AT&T, shall develop a training
program to provide its employees and the employees of all MERCHANTS with
training about the COMPANY Offer, the COMPANY's fulfillment responsibilities and
use of the COMPANY Card and Co-logoed Card, as applicable. COMPANY shall use its
best efforts to insure that all such employees will have the requisite knowledge
to fulfill COMPANY's responsibilities hereunder in a timely and professional
manner.
11. COMPANY, at its expense, will provide certain co-logoed Point of
Sale and training materials as mutually agreed by the parties.
AT&T CONFIDENTIAL AND PROPRIETARY
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12. AT&T, at its cost, shall insert and display the COMPANY Offer,
and include a direct link to the World Wide Web site or COMPANY, on its World
Wide Web Site at "xxxx://xxx.xxx.xxx/xxxxxxx" on or about the Effective Date
hereof. The COMPANY Offer and the direct link shall be removed from the website
on or about the date of termination or expiration of this Agreement on or about
the Effective Date hereof, COMPANY, at its expense, shall insert and display the
COMPANY Offer, and include a direct link to the World Wide Web site of AT&T, on
its World Wide Web Site at "hppt://xxx.xxxxxxxxxxxxxxxx.xxx" and shall remain
inserted and linked until the termination or expiration of this Agreement. The
form and content of both AT&T's and COMPANY's Web Site insertions shall be
subject to the terms and conditions of Section IV of this Agreement.
13. Except for the promotional expenses referred to in Section 12 of
this Attachment C and in Section IV of this Agreement and the payment
obligations set forth in Sections 1 and 4 of this Attachment C and in Attachment
D hereto, the COMPANY Offer and all offer fulfillment obligations set forth
herein shall be provided at no cost to AT&T or any AT&T/SA Member.
AT&T CONFIDENTIAL AND PROPRIETARY
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36
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
ATTACHMENT D
AT&T PAYMENT OBLIGATIONS
AT&T agrees to pay COMPANY the following:
A. [**] for each Half Membership comprising the COMPANY Offer
purchased by AT&T in accordance with this Agreement. This cost includes all
fulfillment costs, including the cost of mailing the Half Fulfillment Kit to the
Member.
B. The applicable sum for each Yearly Membership, excluding ACUS
Memberships, purchased by AT&T pursuant to this Agreement shall be in accordance
with the following chart:
NUMBER OF YEARLY MEMBERSHIPS PER AT&T's COST
ACADEMIC YEAR
[**] [**]
This cost includes payment COMPANY incurs for the printing of the
Co-logoed Card.
C. [**] for each ACUS Membership purchased by AT&T pursuant to this
Agreement.
D. [**], per academic year, AT&T shall [**] per academic year. Such
payment shall be made on a yearly basis prior to the end of the each academic
year and shall be in addition to the cost per Yearly Membership as stated above.
AT&T CONFIDENTIAL AND PROPRIETARY
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37
Confidential Materials omitted and filed separately with the Securities and
Exchange Commission. Asterisks denote omissions.
E. AT&T and COMPANY agree to develop [**] should COMPANY [**] by AT&T, the
[**] to COMPANY at the end of [**]. The parties agree to [**], the terms and
conditions of which [**].
COMPANY shall render an invoice on the dates set forth in Section III of
this Agreement, as applicable, showing the amount(s) due for Sections A, B, C
and D above and for the distribution costs as set forth in Section 4 on
Attachment C and AT&T shall pay such COMPANY invoice(s) thirty (30) days
following receipt. Invoices shall be directed to:
AT&T
Finance Manager
Room 6118F2
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx Xxxxx, XX 00000
AT&T CONFIDENTIAL AND PROPRIETARY
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