RESELLER AGREEMENT
THIS RESELLER AGREEMENT (the "Agreement") is made as of this 30th day
of October, 1996, by and between MAGNACOM WIRELESS, L.L.C., a Delaware limited
liability company with its principal offices at 0000 Xxxxxxxx, Xxxxx 000,
Xxxxxxxxx, Xxxxxxxxxx 00000 (hereinafter referred to as the "Company"), and GST
Telecom Inc., a Delaware corporation with its principal offices at 0000 X.X.
Xxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxxxx 00000 (hereinafter referred to as the
"Reseller").
RECITALS:
WHEREAS, the Company (either directly or through its subsidiaries or
affiliates) is licensed by the Federal Communications Commission (the "FCC") to
own, develop and operate various systems to provide personal communication
services ("PCS") within the "Territories" (as hereinafter defined); and
WHEREAS, the Reseller desires to market and sell access to and usage of
the Company's PCS system within the Territories;
NOW, THEREFORE, in consideration of the premises, the mutual agreements
and understandings herein contained, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
The following terms when used herein shall have the following meanings:
1.1 DEFAULT. The term "Default" is defined to be either party's:
(i) Insolvency or the initiation of bankruptcy or receivership
proceedings, by or against a party, execution of an
assignment for the benefit of creditors or any other
transfer or assignment of a similar nature or otherwise
seeking relief under any applicable bankruptcy,
reorganization, moratorium or similar debtor relief laws (it
being understood that the execution of any third-party
financing agreement[s] shall not constitute a Default
hereunder); or
(ii) Failure to make any payment when due, or a material breach
of any of the other terms or conditions hereof.
1.2 END USER. The term "End User" shall mean the customers purchasing
"Services" (as hereinafter defined) from the Reseller.
1.3 FACILITIES. The term "Facilities" shall mean the telecommunications
switching equipment, cell site transceiver equipment and other equipment to be
constructed by the Company in order to make available the Services within the
Territories. At
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the sole option of the Company, such Facilities may be expanded, modified or
replaced during the term hereof. The Company shall use its good faith efforts to
cause any such modifications or replacements to be accomplished without
unreasonable interference to the Services. The Company shall own, and finance
construction of, the Facilities.
1.4 NUMBER. The term "Number" shall mean a ten (10) digit telephone
number assigned to provide access to the Services.
1.5 RECURRING CHARGES. The term "Recurring Charges" means all charges
and fees from the Services, except those charges that are directly attributable
to usage of, as opposed to access to, the Services.
1.6 SERVICES. The term "Services" shall mean the services set forth on
SCHEDULE 2 attached hereto and incorporated herein by reference to be provided
within the Territories. Upon the mutual agreement of the Company and the
Reseller, such SCHEDULE 2 may be amended from time to time.
1.7 TERRITORIES. The term "Territories" shall mean the geographical
areas to be served by the "Facilities" as designated on SCHEDULE 1 and
incorporated herein by reference, as amended from time to time. At the sole
option of the Company, the Territories may be expanded from time to time to
cover a greater area through the addition to or modification of the Facilities,
but the Company shall be under no obligation to so expand the Territories.
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ARTICLE II
NON-EXCLUSIVE RELATIONSHIP
2.1 On a non-exclusive basis, (including within the Territories), and
upon the terms and conditions herein set forth, the Reseller may purchase
Service from the Company for use or resale.
2.2 On an exclusive basis within the Territories and any other
geographical region in which the Company may offer PCS service, and upon terms
and conditions to be agreed upon which are at least as favorable as to those
offered to others, the Company shall utilize Reseller's facilities to provide
enhanced telecommunications services to all of its resellers and their end
users, including for example local switching, access to long distance, private
lines and voice mail; provided, however, that Reseller is capable of offering
such enhanced telecommunications services and, provided further, that the end
user customer does not object to these services being provided by the Reseller.
ARTICLE III
TERM OF AGREEMENT
Subject to the provisions of Article XIV hereof, the term of this
Agreement shall commence on the date hereof and, unless sooner terminated in
accordance with Article XIV hereof, continue for a period of twelve years (the
"Initial Term"); and, unless either party hereto shall have given the other
party written notice of its intention to terminate the Agreement upon expiration
of the Initial Term at least 180 days prior to such expiration, the term shall
be
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automatically extended for an additional one year period (a "Renewal Term").
Thereafter, absent a delivery of 90 days prior written notice of either party's
intention to terminate the Agreement upon expiration of the then current Renewal
Term, the term of the Agreement shall automatically be extended for an
additional and successive Renewal Term.
ARTICLE IV
ACCESS TO NUMBERS; CONNECTIONS
4.1 Numbers shall be provided to the Reseller only in blocks consisting
of fifty (50) Numbers each for the first fifty (50) Numbers. Thereafter, at the
Reseller's option, numbers may be provided to the Reseller in blocks consisting
of ten (10) Numbers each. The Reseller may, from time to time, and according to
procedures established by the Company, order blocks of ten Numbers by providing
written notice of the number of blocks of Numbers the Reseller desires and the
effective date desired for such assignment. Subject to the availability of
Numbers and the capacity of the Facilities, the Company shall honor orders from
the Reseller and all other resellers (including affiliates of the Company) in
the order in which orders for additional Numbers are received; provided,
however, in no event shall the Company be obligated to assign one or more blocks
of Numbers to any reseller until at least fifty percent (50%) of the Numbers in
the block (or blocks, if more than one block were assigned simultaneously) most
recently assigned have been purchased by and assigned to End Users.
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4.2 Subject to the restrictions of Section 4.1, a given block of
Numbers requested by the Reseller will be made available to the Reseller by the
Company within two working days of the receipt by the Company of an order from
the Reseller requesting said block of Numbers.
4.3 Each Number included within each block of Numbers represents a unit
of access to the System. The Numbers shall be assigned by the Company and
neither the Reseller nor any End User shall acquire any proprietary interest in
any specific Number assigned for its use. Neither the Reseller nor any End User
has any property right in the Numbers assigned and none is or can be acquired by
usage or otherwise. The parties understand and agree that the Company reserves
the right to assign, designate, or change such Numbers when reasonably necessary
to the conduct of its business. The Company shall make a good faith effort to
provide thirty (30) days' notice of the assignment, designation, or change of
any such Number, provided, however, such notice period shall not apply to a
disconnection of Services in accordance with Section 5.5.
4.4 The Reseller acknowledges that upon the disconnection of any End
User for any reason, the disconnected End User's Access Number shall not be
reassigned to a new End User for a minimum period of ninety (90) days. The
Company will allow the reassignment of a previously disconnected Reseller Access
Number at the conclusion of said minimum period, unless good cause exists and
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the parties mutually agree, based on normal industry practices, to delay further
such reassignment.
ARTICLE V
PRICES; TERMS OF PAYMENT
5.1 In consideration for the Services provided herein, the Reseller
shall pay to the Company the lump sum payments in the amounts and at the times
set forth on SCHEDULE 2A hereto, as pre- payment for the Services (the
"Prepayment Reserve"). No additional lump sum pre-payments shall be made by
Reseller. As actual charges for the Services are incurred such actual charges
will be credited against the Prepayment Reserve.
5.2 For the purpose of charging for the Services, a billing cycle
begins at the beginning of the eleventh (11th) calendar day of each calendar
month, and ends at the end of the tenth (10th) calendar day of the subsequent
calendar month. For each block of Numbers, Recurring Charges for Services (as
established under Section 1.5) for periods that are less than entire billing
cycles shall be the Recurring Charges for such block of Numbers during the
billing cycle, prorated according to the number of days the Services are
available with respect to such block of Numbers during the billing cycle. In the
event of any termination of this Agreement, the Reseller will continue to be
responsible for all charges associated with Numbers provided to the Reseller,
even if such charges are incurred or billed after termination of this Agreement.
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5.3 Except where the Reseller has provided evidence to the Company,
satisfactory to the Company in its sole discretion, that the Reseller has
collected and paid, or will collect and pay, any and all duties, levies, taxes
or withholdings due with respect to the Services, including, without limitation,
sales tax, use tax, property tax and ad valorem tax, excepting only taxes on the
income of the Company, the Company may collect from the Reseller, in addition to
any charges, an amount equal to any such duty, levy, tax or withholding.
5.4 Charges under Section 5.1 shall commence with respect to each block
of Numbers assigned to the Reseller at the time the Company gives the Reseller
notice that the Numbers in such block are available for use or resale. Such
charges shall continue until the date such block is canceled or otherwise
disconnected in accordance with the provisions of this Agreement.
5.5 The billing cycle for charges for Services hereunder shall be
monthly. The Company may, in its sole discretion and upon ninety (90) days'
prior written notice, adopt a semi-monthly billing cycle. The Reseller shall be
invoiced on a periodic basis and agrees to pay for all charges pursuant hereto
and for Services hereunder, including, but not limited to, charges for toll
calls, directory listing, custom calling charges, network service, PCS network
usage, directory assistance, roamer service charges and 900 service. Payment for
such invoices shall be (i) credited against the Prepayment Reserve, until it is
exhausted, and then (ii) shall be due and payable in United States Dollars
within twenty (20) days
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after the date of the Reseller's receipt of each such invoice. If any charges
reflected on an invoice are disputed by the Reseller, the Reseller shall
promptly notify the Company in writing of the subject amounts and the basis for
the dispute. Any amount (other than disputed amounts) which is not paid in full
by the due date thereof shall be subject to a late payment charge equal to the
maximum rate permitted by applicable law from the due date thereof until the
date of payment. Any amounts required to be paid hereunder will be deemed paid
when received, subject to collection of proceeds if payment is other than in
cash, at the location designated by the Company from time to time. In addition,
and without limiting any other remedies which may be available to the Company,
if payment is not made in full (other than disputed amounts) by the Reseller by
the due date thereof and the Reseller has not cured such default within ten (10)
days after receiving written notice thereof from the Company, the Company shall
have the right, but not the obligation, to (i) disconnect from the Services all
blocks of Numbers to which such delinquent payment relates and a standard
service charge will be made by the Company if such blocks of Numbers are
reconnected and (ii) immediately draw down on any deposit or letter of credit
provided by the Reseller in accordance with Section 5.6 to the extent of such
payment due. Nothing contained in this Section 5.5 shall be construed as in any
way limiting the rights of the Company under Article XIV of this Agreement to
declare the Reseller in default upon the occurrence of
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a Default, including but not limited to the failure to make a payment when due.
5.6 In addition to the charges set forth above, once the Prepayment
Reserve has been exhausted the Reseller shall be required to pay to the Company
a security deposit in the amount of Two Hundred Dollars ($200.00) against
billing for each Number, which deposit may be in the form of a letter of credit.
5.7 A magnetic tape, at specifications determined by the Company, will
be provided monthly to the Reseller. The tape identifies detailed usage for each
access number. The Reseller shall notify the Company of the location to which
the magnetic tape is to be delivered. The Reseller shall pay the Company a One
Hundred Dollar ($ 100.00) fee for any such tape not returned to the Company
within thirty (30) days of receipt by the Reseller. If the Company adopts a
semi-monthly billing cycle as provided in Section 5.5 hereof, then the Company
shall, if requested by the Reseller, provide the magnetic tape semi-monthly.
5.8 (a) To the extent that the agreed upon charges for services set
forth on SCHEDULE 2 hereto (as amended from time to time by agreement of the
Reseller and the Company) for Services and arrangements furnished to the
Reseller pursuant to this Agreement are not subject to any federal, state, or
local regulation or tariff, such charges may be (i) increased by the Company
upon written notice to the Reseller at least ninety (90) days in advance of the
effective date of such increase and (ii) decreased by the Company immediately
upon written notice to the Reseller.
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Notwithstanding the foregoing, during the Initial Term, the charge to Reseller
shall be not more than $.05 per minute of PCS telephone service; provided,
however, that at no time can the Company assess charges to Reseller which are
less favorable, both for individual services and in the aggregate, than the
charges assessed or established for any other reseller or significant direct
customer of the Company; and provided, further, that at no time shall the
foregoing proviso be interpreted to cause the Company to set charges for any of
the Services at a level which is below its cost.
(b) Nothing in this Agreement shall be deemed (i) to require
or preclude the use of tariff equivalent or tariff related charges, or (ii) to
provide or imply that such charges are or are not appropriate in the provision
of Services provided hereunder (except for the last sentence of Section 5.8(a)).
5.9 In the event an End User's PCS phone is lost, stolen, or otherwise
absent from the End User's possession or control, the Reseller shall
nevertheless be liable for all charges attributable to the access Number
assigned to such PCS telephone until the loss, theft or absence is reported to
the Company.
ARTICLE VI
SPECIFICATION OF SERVICES
The Company agrees that the Facilities to provide the Services will be
operational and the Services will be available no later than the date which is
the later of (i) the third anniversary of the date hereof and (ii) the date by
which the FCC requires that the Facilities be operational or the Company will
provide the
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Reseller services through a third party on terms no less favorable than
contained herein. Failure to make such Services available by such date, which
failure remains uncured following thirty (30) days' written notice by Reseller
of such failure, shall be a material breach of this Agreement. Services will be
delivered in accordance with specifications set forth on SCHEDULE 2 hereto,
which Schedule may be modified or amended by the Company without notice,
provided that, except for changes or modifications resulting from emergencies or
force majeure conditions, such change or modification does not substantially
degrade the functioning or performance of the Services.
ARTICLE VII
RESELLER'S OBLIGATIONS
7.1 The Reseller is solely responsible for all charges under Article V
above (including, but not limited to, all End User toll calls, directory
listings, custom calling charges, network service, PCS network usage, roamer
service charges, directory assistance, and 900 service) with respect to any
Number assigned to such Reseller hereunder until twenty-four (24) hours after
receipt by the Company in a form reasonably prescribed by the Company of notice
from the Reseller to disconnect any such Number.
7.2 The Company may require the Reseller to provide, maintain and use a
terminal compatible with the systems of the Company to transmit notices to the
Company for number status changes. The Reseller shall pay all local
telecommunications charges within the Territories which are associated with the
aforesaid notices and
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will furnish operators proficient in operating any such terminal in conjunction
with any Company computer system.
7.3 As between the Company and the Reseller, the Reseller is
responsible for insuring that any equipment utilized by its End Users in
connection with the Services and each End User's use thereof shall at all times
meet industry standards for compatibility, the requirements of the FCC and other
applicable regulatory authorities and the technical requirements and standards
reasonably set forth by the Company from time to time hereunder.
7.4 The Reseller shall provide an adequate staff to receive and
investigate any complaints from its End Users relating to the Services, and will
report any trouble with the Services to the Company only upon reasonable
verification that such trouble is due to reasons other than the misuse or
malfunctioning of the End User's equipment or the failure of such equipment to
meet the technical standards for compatibility with the Services. The Reseller,
at its own cost and expense, shall maintain adequate staff and equipment to test
End User's equipment or to make arrangements with a qualified service facility
to verify the cause of any complaints received by the Reseller with respect to
the Services. In the event the cause of any trouble reported to the Company by
the Reseller is investigated by the Company and ultimately determined to be due
to misuse, malfunctioning or technical incompatibility of the End User's
equipment, the Reseller shall reimburse the Company for all out-of-pocket
expenses actually incurred by the Company in performing such investigation.
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7.5 The Reseller, at its own costs and expense, shall maintain an
adequate staff to market the Services and to support and train its End Users
with respect to the Services.
7.6 The Reseller shall be solely responsible for all risks and expenses
incurred in connection with its actions in the sale and service of the Services
or any other acts required of the Reseller pursuant to this Agreement. The
Reseller shall act in all respects on its own account and shall be solely
responsible for any credit verification, deposits, billing, collection,
consolidation, rebilling, customer billing complaints, toll calls, bad debts and
fraudulent use by any End User of any Number assigned to the Reseller.
7.7 The Reseller shall, prior to the commencement of marketing
Services, provide its form of End User contract, if any, to the Company for its
review. The Company's review shall be limited to ascertaining whether the
proprietary and legal interests of the Company are adequately protected in such
contract, as well as determining if mandatory language such as that provided
below has been included. The Reseller may delete proprietary information not
relating to the Company's interests from such contract prior to submitting it
for review. The Reseller agrees that any End User Contract shall contain the
following language:
"[END USER] shall acquire no proprietary interest in numbers assigned
by [THE RESELLER] for its use.
The liability of [the RESELLER] and/or any supplier of services to [THE
RESELLER] for actual proven damages for any
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cause whatsoever, including but not limited to any failure of or
disruption of services provided hereunder, regardless of the form of
action, whether in contract or in tort or otherwise, including
negligence and strict liability, shall be limited to an amount
equivalent to charges payable by [END --- USER] under this contract for
the services during the period such damages occur. In no event shall
[THE RESELLER] and/or any supplier of services to [THE RESELLER] be
liable for any special or consequential damages. No action related to
this agreement, regardless of form, may be brought by [END USER] later
than one year after the cause of action has accrued."
Any deviation from the mandatory language shall, in each instance, only be made
with the prior written consent of the Company.
7.8 In the event that any of the Services provided hereunder or the
charges made therefor are currently subject, or at any time become subject, to
any federal, state or local regulation or tariff, and the Reseller intends to
intervene or otherwise participate in any proceedings before any governmental
entity with respect to the Services or the charges, the Reseller shall consult
with the Company for the purpose of good faith negotiations by the parties to
resolve any controversial matters between the parties prior to the Reseller's
intervention or participation before such governmental entity.
7.9 The Reseller hereby agrees to indemnify the Company and hold the
Company harmless against any and all claims for libel, slander, or infringement
of copyright with respect to the material
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transmitted over the Facilities, against any and all claims for infringement of
patents arising from combining with, or using in connection with the Company
Facilities, apparatus and system of the Reseller or its End Users and against
any and all other claims arising out of any act or omission of the Reseller in
connection with Facilities provided by the Company.
ARTICLE VIII
ADVERTISING AND PROMOTION
The Company may, from time to time, establish standards for all
advertising, promotional and End User training materials used or distributed by
the Reseller which relate to the Services. Such standards will be reasonable,
and will be limited to factual matters pertaining to the services provided by
the Company and use of the service marks and trademarks of the Company and its
affiliates. Failure of the Reseller to abide by such standards, which failure
remains uncured following thirty (30) days' written notice of such failure,
shall be a material breach of this Agreement.
ARTICLE IX
TRADE NAME AND TRADEMARK
9.1 The Company's corporate name, service marks, trademarks, trade
names, insignias, symbols, decorative designs and slogans, or the like, either
presently existing or hereafter created or used, which the Company now or
hereafter owns, uses or is licensed or sublicensed to use (collectively, the
"Marks") and all goodwill associated therewith, and all of the Company's
copyright or
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copyrightable works or other materials of the Company (the "Works") are, and
shall be, the sole and exclusive property of the Company as between the Company
and the Reseller. The Reseller shall not use any Marks or Works at any time in
any manner, except as authorized by the Company specifically in writing prior to
each such use. The Reseller acknowledges that its right to use the Marks or the
Works is derived solely from this Agreement and the Reseller agrees to comply
with all rules, regulations and procedures pertaining to such Marks and Works
which are prescribed by the Company from time to time. The Reseller further
acknowledges and agrees that all usage by the Reseller of the Marks, any
goodwill established thereby or associated therewith, or the Works, shall inure
to the exclusive benefit of the Company and its affiliates and that this
Agreement does not confer any rights, goodwill or other interests in the Marks
or Works upon the Reseller. Any unauthorized use of the Marks or Works by the
Reseller, or any use not in compliance with the terms hereof, shall constitute
an infringement of the rights of the Company and its affiliates.
9.2 The Reseller shall use the Marks and Works with such notices of
proprietary rights, ownership or registration and such words qualifying or
identifying the agency relationship of the Company and the Reseller as the
Company may from time to time prescribe. The Reseller shall not use any of the
Marks, or any material portion thereof, as part of the Reseller's corporate or
trade name or with any prefix, suffix or other modifying words,
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terms, designs or symbols, or in any modified form, nor may the Reseller use the
Marks in connection with the sale or leasing of any product or service or in any
manner not expressly authorized by this Agreement without the prior written
consent of the Company.
9.3 If the Company notifies the Reseller to modify or discontinue the
use of any Xxxx, the Reseller shall take such action as soon as possible after
such notice and the sole obligation of the Company in such event shall be to
reimburse the Reseller for the Reseller's actual, reasonable out-of-pocket
costs, if any, for complying with the obligations to modify or discontinue the
use of any such Xxxx. The Reseller shall immediately discontinue any use of the
Marks and any use of the Works upon any expiration or termination of this
Agreement.
9.4 The Reseller agrees that it will not, during the term of this
Agreement or thereafter, attack the title or any rights of the Company in and to
any or all of the Marks or Works or take any action which would adversely affect
the Company's rights therein. The Reseller agrees to assist the Company, and the
Company agrees to reimburse the Reseller for all associated reasonable pre-
approved costs in connection therewith, to the extent necessary for the
procurement of or any protection of the Company's rights to or in the Marks or
Works. The Reseller agrees to promptly notify the Company of any observed or
known infringements upon or imitations of the Marks or Works or substantially
similar items; provided, however, the Company shall have the sole right to
determine what,
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if any, action should or will be taken on account of any such infringement or
imitation.
9.5 The Company recognizes the right, title and interest of the
Reseller and its affiliates in and to the Reseller's service marks, trademarks
and trade names used by the Reseller in connection with the Services. The
Company agrees not to engage in any activities or commit any acts, directly or
indirectly, that contest, dispute or otherwise impair the right, title and
interest of the Reseller and its affiliates in the Reseller's service marks,
trademarks and trade names. The Company shall neither acquire nor claim any
right, title or interest in or to the Reseller's service marks, trademarks or
trade names through advertising or sale of Services or otherwise.
9.6 The obligations undertaken by the parties pursuant to this Article
IX shall survive termination of this Agreement, and, in the event of such
termination, each of the parties agrees not to register or use any trademarks or
trade names which are the same as, or confusingly similar to, trademarks and
trade names of the other or any of its affiliates, and the Reseller and the
Company will surrender or abandon their use or ownership of any trade name or
style containing any xxxx or trade name confusingly similar to that of the other
or any affiliate thereof.
ARTICLE X
BILLING ADJUSTMENTS
A credit allowance will be made, at the Reseller's request, in the form
of a pro rata adjustment of the Recurring Charges billed
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by the Company for any period of total outage of Services. For other than total
outage of Services, a credit allowance, at prices to be outlined in SCHEDULE 2
hereto (as may be amended from time to time), will be given to the Reseller for
periods End Users are unable to place or receive calls due to interruptions
affecting Services for in excess of twenty four (24) continuous hours and such
credit allowances will be given only for time actually credited by the Reseller
to End Users. No adjustments shall be allowed for periods of interruption of
less than twenty-four (24) hours even if in the aggregate they exceed
twenty-four (24) hours. The Reseller's request for credit must be received by
the Company in a form specified by the Company within ten (10) business days
following the end of the period of interruption. The credit allowance for total
outage of Services will be computed by dividing (a) the duration of the
interruption affecting Services (measured in days from the time the interruption
is reported to and confirmed by the Company) by (b) thirty (30) and multiplying
the result by the Company's Recurring Charges for each interrupted access
Number. No credit shall be provided for a period of time less than twenty-four
(24) continuous hours. No other liability shall attach to the Company as a
result of such interruption of Services. A credit allowance will not be given
for interruptions caused by the negligent or willful actions (or failure to act)
of the Reseller or its End Users, for failures of connecting circuits, power
outages or any other occurrences considered to be a force majeure, or for
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interruptions caused by failure of equipment or service not provided by the
Company.
ARTICLE XI
RESTRICTIONS ON USE
11.1 Services are furnished subject to the condition that there will be
no abuse or fraudulent use thereof. Abuse and fraudulent use of Services
include, but are not limited to:
(a) Obtaining or attempting to obtain Services by rearranging,
tampering or making connection with any Facilities of the
Company, or by any scheme, false representation or false
credit device, or by or through any other fraudulent means
or device whatsoever, with intent to avoid payment, in whole
or in part, of charges for Services or assisting any other
person in such regard; or
(b) Attempting to, or actually, obtaining accessing, altering,
or interfering with the communications and/or information of
another Company customer or any End User or assisting any
other person in such regard; or
(c) Using the Services in manner that interferes unreasonably
with the use of Services by one or more other customers or
End Users.
11.2 Any attempt by the Reseller to abuse or to fraudulently use
Services shall be deemed a material breach of this Agreement. If any End User
abuses or fraudulently uses Services, the Company
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may, by written notice to the Reseller, require the Reseller to cancel such End
User's right to use the Services, and failure of the Reseller to so cancel such
End User's rights within fifteen (15) days of receipt of said notice shall be
deemed a material breach of this Agreement. The Company shall indemnify the
Reseller for actual losses, if any, resulting from any inaccuracies contained in
any such notice. Notwithstanding any provisions herein to the contrary, such
material breach shall immediately entitle the Company to any and all of the
Company's remedies hereunder, and any remedies as may exist at law or equity.
11.3 All provisions of this Article XI shall survive termination of
this Agreement, whether by expiration or otherwise.
11.4 If the use of any equipment provided by the Reseller or End User
in connection with the Services violates or would violate any law or any of the
provisions in this Agreement, the Company will take such action as is reasonable
and necessary for the protection of the Facilities or the Service to its other
customers and other persons provided with PCS telephone services. The Reseller
or End User, as applicable, shall discontinue such use of the equipment and
correct the violation immediately upon actual or constructive knowledge of a
violation and shall, if requested by the Company, confirm in writing to the
Company within fifteen (15) calendar days that such use has ceased and that the
violation has been corrected. Failure of the Reseller or End User to discontinue
such use or correct the violation or to give the required written confirmation
to the Company within the period indicated above shall
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result in interruption of the Services to the Reseller or the End User who is
creating the violation, until such time as the Reseller or the End User, as
applicable, complies with the provisions of this Agreement. If the Reseller has
not started to remedy the violation described in said notice within the first
ten calendar (10) days of such fifteen (15) day period, the Company may notify
End Users after such ten (10) days by telephone or telephone intercept that
Services to the Reseller will be discontinued at the end of such fifteen (15)
day period and how the End Users may maintain PCS telephone services with the
Company after discontinuation of the PCS telephone services to the Reseller.
11.5 Notwithstanding the above, PCS telephone services may be refused,
reduced, or partially or completely discontinued at any time without notice in
the event either (a) the Company is informed that the Services are being used in
such a manner that will adversely affect the Company's services to others; or
(b) the Company finds that duplicate electronic PCS telephone numbers have
generated usage on the Facilities or any PCS system with which the Company has a
mutual roaming agreement.
ARTICLE XII
PROPRIETARY INFORMATION; CONFIDENTIALITY
During the term of this Agreement, either party (the "disclosing
party") may, but shall not be obligated to, disclose to the other party (the
"recipient party") information which is considered proprietary or confidential
by the disclosing party. Without the disclosing party's specific prior written
consent,
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disclosure shall not be made to any third party, including, but not limited to,
End Users, of any information supplied by the disclosing party to the recipient
party which has been designated as confidential, and which information is not
otherwise generally available to the public or is not already known to such
recipient party. Confidential information does not include any information that
(a) is within the public domain, (b) at the time of entering into this
Agreement, is known by the recipient party, (c) is independently developed by
the recipient party, or (d) is disclosed to the recipient party by a third party
under no obligation to maintain confidentiality to the disclosing party.
Notwithstanding anything contained herein to the contrary, no party will be in
violation of its confidentiality obligations hereunder by reason of releasing
confidential information as required by law or an order issued by a court or
administrative body.
ARTICLE XIII
WARRANTY AND LIMITATION OF LIABILITY
13.1 THE COMPANY MAKES NO WARRANTY, EITHER EXPRESS OR IMPLIED,
CONCERNING THE FACILITIES OR THE SERVICES, INCLUDING, WITHOUT LIMITATION,
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE. IT IS
INTENDED BY THE PARTIES THAT THIS SECTION SHALL APPLY TO BOTH THE RESELLER AND
ALL OF THE RESELLER'S END USERS.
13.2 Except for damages caused by the Company's negligence or the
intentional misconduct in failing to maintain proper standards of maintenance
and operation and to exercise reasonable
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supervision, the liability of the Company for damages arising out of (a)
mistakes, (b) omissions, (c) interruptions, (d) delays, errors, or defects in
transmission or (e) errors in directory listings shall in no event exceed an
amount equivalent to the lesser of (a) the proportionate charge to the Reseller
for the period of the disruption of Services and (b) the amount of Seven
Thousand Five Hundred Dollars ($7,500.00). In no event shall the Company be
liable for any indirect, special or consequential damages arising hereunder.
13.3 The Company shall not be liable for any act or omission of the
Reseller or any other entity furnishing equipment, software or services to the
Reseller or to the Reseller's End Users, nor shall the Company be liable for any
damages or losses due to the fault or negligence of the Reseller or any End User
or for the failure of such equipment, software, or services.
13.4 The Company shall not be liable to the Reseller or to the
Reseller's End Users if changes in any of the Facilities, operations, equipment,
procedures, or Services (a) render obsolete any equipment or software provided
by the Reseller or End User in conjunction with its use of the Services; (b)
require modification or alteration of such equipment or software; or (c)
otherwise affect the performance of such equipment or software. The Company
agrees to attempt to give the Reseller a thirty (30) day advance written notice
of changes which may be reasonably anticipated to result in the conditions
described in clause (a) or (b) of this
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Section 13.4, but will in no event be liable in any way for the failure to give
such notice.
13.5 The Reseller assumes sole responsibility for the selection and use
of any codes or passwords that may be permitted or required in order for its End
Users to use the Services. The Reseller understands that the Services are
provided by radio; the Company shall have no responsibility or obligation for
the security of the communications of End Users using the Services.
13.6 The Reseller acknowledges that the PCS Units used by the Company's
customers may be programmed to prefer the "A" system in both the "home" and
"roam" modes. The Reseller further acknowledges that any End User whose PCS Unit
is programmed otherwise may not be capable of receiving the full scope of the
Services. The Company shall not be liable for any such diminished capacity of an
End User resulting from the programming of a PCS Unit at variance with the
Company's standard programming.
ARTICLE XIV
TERMINATION
14.1 Either party may terminate this Agreement in the event of a
Default by the other, provided that the non-defaulting party advises the
defaulting party in writing of the event of Default and the defaulting party
does not remedy the Default within thirty (30) business days of receipt of
written notice thereof. Except as otherwise provided by this Agreement, such
termination shall be effective upon the expiration of the thirty (30) business
day period immediately following receipt of notice of Default by the
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defaulting party. The Company agrees to provide the Services to the Reseller
with respect to the Numbers then connected to the system for a period of thirty
(30) business days after the Reseller's receipt of notice of Default hereunder,
but the Company is not obligated to provide the Services with respect to any
Numbers not at such time connected to the system. If the Default described in
said notice is not remedied with the first twenty (20) business days of such
thirty (30) business day period, the Company may notify End Users by telephone
or telephone intercept after such first twenty (20) business days that the
Agreement may terminate at the end of such thirty (30) business day period and
how the End Users may maintain services with the Company after termination of
this Agreement.
14.2 Termination, regardless of cause or nature, shall be without
prejudice to any other rights or remedies of the parties (including Reseller's
rights to recoup the Prepayment Reserve then outstanding), and shall be without
liability for any loss or damage occasioned thereby. The Reseller shall remain
solely responsible for its obligations to End Users in effect immediately prior
to termination. Termination of this agreement, regardless of cause or nature,
shall not release either party hereto from any liability which at the time of
termination had already accrued to the other party hereto or which thereafter
may accrue in respect of any act or omission prior to termination, or from any
obligation which is expressly stated herein to survive termination; provided,
however, that the Company may, without liability, cancel any previously
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accepted orders for Numbers which have not been connected upon giving or
receiving of any notice of termination hereunder. The Company and the Reseller
agree to cooperate to enable all End Users to continue to utilize the Services
with minimal disruption after termination, provided that the Company shall be
under no obligation to ensure that any End User is so able to continue to
utilize the Services or to arrange for any transfer of equipment owned or leased
by the Reseller.
ARTICLE XV
MISCELLANEOUS
15.1 In the event that any of the Services provided hereunder or the
charges made therefor are currently subject, or at any time become subject, to
any federal, state or local regulation or tariff, then the terms and conditions
of this Agreement including the charges to be set forth on SCHEDULE 2 hereto (as
amended from time to time by the parties) shall be amended in a manner mutually
agreeable to the parties hereto to conform to any conflicting terms or condition
in effect under such regulation or tariff; provided, however, that all
non-conflicting terms and conditions of this Agreement shall remain valid and
effective.
15.2 The validity, construction and performance of this Agreement shall
be governed by and interpreted in accordance with the laws of the State of
Delaware.
15.3 Headings to articles of this Agreement are to facilitate reference
only, do not form a part of this Agreement, and shall not in any way affect the
interpretation hereof.
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15.4 No rights or obligations hereunder shall be assigned or delegated,
in whole or in part, by either of the parties hereto to any other person, firm,
corporation or other entity without the prior written consent thereto by the
other party hereto, which consent shall not be unreasonably withheld; provided,
however, that either Reseller or the Company may assign this Agreement without
the prior consent of the other to any persons, partnership, firm or corporation
acquiring all, or substantially all of its assets, or to any affiliate or
successor entity thereto; and provided, further that Reseller may assign this
Agreement to any direct or indirect subsidiary or affiliated company which is
under common control of its corporate parent. It shall be a condition of any
agreement for an acquisition of the Company or Reseller that the terms and
conditions of this Agreement will be honored and accepted in full by the
acquiring party.
15.5 The waiver, express or implied, by either party hereto of any
rights hereunder or of any failure to perform or breach hereof by the other
party hereto shall not constitute or be deemed a waiver of any other rights
hereunder or of any other failure to perform or breach hereof by the other party
hereto, whether of a similar or dissimilar nature.
15.6 Neither party is authorized to act as an agent for, or legal
representative of, the other party nor shall either party have authority to
assume or create any obligation on behalf of, in the name of, or binding upon,
the other party. The Reseller shall not represent itself as a distributor of the
Company in any manner
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not specifically provided for herein. All sales by the Reseller shall be in its
own name and for its own account.
15.7 (a) Except as otherwise provided in this Agreement, all notices
required or permitted to be given hereunder shall be made by registered mail,
return receipt requested, postage prepaid, in any post office in the United
States, addressed as follows:
If to the Company:
Magnacom Wireless, L.L.C.
0000 Xxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxx 00000
If to the Reseller:
GST Telecom Inc.
0000 X.X. Xxxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Either party hereto may change its address by a notice given to the
other party hereto in the manner set forth above. All notices shall be effective
upon receipt.
(b) The communications system described in Section 7.2 hereof
may be used for the purpose of handling notices hereunder as the Company may
from time to time specify. Notices given by either party pursuant to such
communication system shall be deemed received by the other party on the date set
forth on the written verification of such notice provided by the receiving
party. Machine verification by the system described shall be deemed to
constitute a written verification hereunder.
15.8 Should any part of this Agreement for any reason be declared
invalid by court order or by order of any regulatory agency, such order shall
not affect the validity of any remaining
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portion, which shall remain in force and effect as if this Agreement had been
executed with the invalid portion thereof eliminated, and it is hereby declared
the intention of the parties hereto that they would have executed the remaining
portion of this Agreement without including therein any such part or portion
which may, for any reason, be hereafter declared invalid.
15.9 The Reseller recognizes and agrees that the Company will be
marketing the Services to other resellers and directly to end users in the
Territories for its own account, and that End Users of the Reseller may seek to
obtain Services directly from the Company or through its other resellers.
15.10 The parties' performance under this Agreement shall be excused if
such non-performance is due to labor difficulties, governmental orders,
equipment failure, inability to or delay in securing equipment, civil
commotions, acts of nature, weather disturbances or adverse weather conditions,
and other circumstances beyond the parties' reasonable control.
15.11 The parties recognize that unusual concentrations of usage may
occur in certain locations. The Company shall incur no liability for its
inability to provide adequate Services hereunder if such inability is due to a
lack of network capacity which results from the aforementioned usage
concentration.
15.12 The terms and conditions hereof supersede all other agreements
and understandings between the parties hereto, including prior or
contemporaneous representations of sales representatives or other personnel of
the Company, whether oral or written, and
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subsequently issued purchase orders, acceptances, correspondence and similar
documents, except for (a) agreements executed on unchanged standard printed
forms of the Company, or (b) subsequent agreements which are at variance with
this Agreement and which are made in writing and signed by a duly authorized
employee of the Company and a duly authorized employee of the Reseller and which
are specifically designated as an amendment hereof.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
day and year first above written.
The "Company" The "Reseller"
MAGNACOM WIRELESS L.L.C. GST TELECOM, INC.
By: /S/ XXXX XXXXX By: /S/ XXXXXXX XXXXX
-------------- -----------------
Title:MANAGING MEMBER Title:SECRETARY
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SCHEDULE 1
PCS COVERAGE GEOGRAPHIC AREAS
Company
TERRITORIES
Tucson, Arizona
Harrison, Arkansas
Hot Springs, Arkansas
Russellville, Arkansas
Farmington, New Mexico
Gallup, New Mexico
Santa Fe, New Mexico
Eugene, Oregon
Salem, Oregon
Guam, Saipan
St. Xxxxxx, Utah
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SCHEDULE 2
SCHEDULE OF SERVICES
SERVICES
End user toll calls
Directory listings
Custom calling
Network service
PCS network usage
Roamer service charges
Directory assistance
900 service
Credit allowance for interruptions in excess of 24
hours
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SCHEDULE 2A
SCHEDULE OF PREPAYMENTS
AMOUNT DUE DATE
$5,997,000 By June 30, 1996
$2,970,000 By September 30, 1996
$5,426,000 By December 30, 1996
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