EXHIBIT 10.97
AGREEMENT
This Agreement is made between XxXxxx USA Telecommunications Services, Inc.
("McLeodUSA"), and U S WEST Communications, Inc. ("U S WEST"), for the purpose
of formalizing the conditions discussed in the mediation conducted by Xxxxxxx
Xxxxxxx in Des Moines, Iowa on April 22, 1997. The subject of the mediation was
a dispute concerning the SMDR function of Centrex Plus service.
1. U S WEST agrees that on or before June 15, 1997 it will demonstrate to the
reasonable satisfaction of McLeodUSA that, for a one-week period prior to June
15, 1997, it has activated the SMDR function of Centrex Plus service on 95% of
all SMDR eligible lines in Iowa identified to U S WEST within 36 hours of the
time the customer is converted to McLeodUSA service. In the event that U S WEST
does not make this demonstration to McLeodUSA, neither McLeodUSA nor U S WEST
will have any further obligations under this agreement.
2. When paying its bills to U S WEST, McLeodUSA will make no additional
deductions related to SMDR service until after June 15, 1997. After June 15,
1997, Paragraph 4 of this Agreement will control any credits to be issued to
McLeodUSA.
3. Within several days of the demonstration referenced in Paragraph 1,
McLeodUSA will pay to U S WEST $500,000. THis payment will constitute full
settlement of all claims by either party against the other regarding the
provision of SMDR service by U S WEST to McLeodUSA prior to June 15, 1997.
4. After June 15, 1997, and during all times which U S WEST supplies McLeodUSA
with Centrex Plus Service pursuant to contract, U S WEST agrees to utilize its
best efforts to ensure that the SMDR function is activated on 95% of all lines
with SMDR capability identified to U S WEST converted to McLeodUSA service
within 36 hours of the time the line is converted ("SMDR deadline") and to
endeavor to activate the SMDR function on all eligible lines in an expedient
manner. McLeodUSA will provide U S WEST with all reasonable information and
assistance in order to meet the 95% standard. U S WEST will provide to McLeodUSA
on at least a weekly basis the SMDR flag-setting data base to determine whether
this standard is being met. McLeodUSA will provide to U S WEST the data
necessary (including but not limited to the telephone number and conversion date
for all disputed lines) to support any claim that the standard was not met. In
the event that this standard is not met for any one-week period, U S WEST will
provide McLeodUSA with a credit on its xxxx equal to $0.50 per twenty-four hours
(or fraction thereof) for each line below the 95% level, until the SMDR function
is activated on that line. Lines having SMDR flags activated after the SMDR
deadline will not reduce the credit until the total number of lines for the week
with SMDR flags not activated is less than or equal to the number of lines by
which the 95% standard was missed.
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Example of calculation:
. 1,000 lines are converted to McLeodUSA service in a week.
. 900 lines have SMDR activated within 36 hours of conversion; 100 lines
do not have SMDR activated.
. Since SMDR has been activated within 36 hours on only 90% of the
lines, the standard is not met and a credit is due.
. Because the 95% standard was "missed" by 50 lines, the credit will
not be reduced until the total number of lines for the week with SMDR
flags not set is less than or equal to 50. Examples of various
situations are shown below:
. All 100 flags set within 24 hours after SMDR deadline: Credit
equal 50 lines * 1 day * $0.50 = $25.00
. 75 flags are set within 24 hours after the SMDR deadline, and the
other 25 flags are set within 48 hours after the SMDR deadline:
Credit equals [50 lines * 1 day * $0.50] = $25.00
. No flags are set within 24 hours after the SMDR deadline, and all
100 flags are set within 48 hours after the SMDR deadline: Credit
equals [50 lines * 2 days * $0.50] = $50.00
. No flags are set within 24 hours after the SMDR deadline, 50
flags are set within 48 hours after the SMDR deadline, and 50
flags are set within 72 hours after the SMDR deadline: Credit
equals [50 lines * 2 days * $0.50] = $50.00
. 40 flags are set within 24 hours after the SMDR deadline, no
additional flags set in the next 24 hours, and the remaining 60
are set within 72 hours after the SMDR deadline: Credit equals
[50 lines * 3 days * $0.50] = $75.00
5. In the event that U S WEST notifies McLeodUSA by July 31, 1997 that U S WEST
will establish a network data mover ("NDM") to provide SMDR data in electronic
form on a bi-weekly or more frequent basis, and that such NDM is completed and
operational by September 30, 1997, McLeodUSA agrees to pay to U S WEST the sum
of $100,000 within fourteen days of the date U S WEST completes its work to
establish the NDM. Costs for data transmission equipment, modems and/or lines
for the transmission of the data, as well as the recurring and nonrecurring
charges associated with implementing the NDM, will be borne by McLeodUSA.
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6. The parties agree that any disputes concerning this Agreement will be
resolved by binding arbitration with Xxxxxxx Xxxxxxx to serve as arbitrator and
shall be conducted in accordance with the then current rules of the American
Arbitration Association ("AAA"), including all expedited procedures prescribed
by AAA. Any damages or penalties found by the arbitrator will be limited to
those specified in this Agreement.
7. The parties have previously entered into various Master Agreements for the
provision of Centrex Plus service. The parties believe that the scope of this
Agreement is independent from and not covered by the Master Agreements. In the
event that any terms or provisions of this Agreement and any Master Agreement
are found to overlap, then this Agreement shall be deemed an amendment to any
such Master Agreement, and the terms and conditions of the Agreement shall
control.
8. This Agreement on the issue of the SMDR function or its equivalent will
apply to all states where McLeodUSA purchases SMDR service or its equivalent
from U S WEST, however, U S WEST will have ninety days after the first Centrex
common block and the SMDR Eligible lines are installed in U S WEST's Central or
Western Region to meet the 95% standard.
McLeodUSA Telecommunications U S WEST Communications, Inc.
Services, Inc.
Its: /s/ Xxxxxxx X. Xxxx Its: /s/ X.X. Xxxxxxx
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Date: July 3, 1997 Date: July 7, 1997
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