<PAGE>
Exhibit 10.28
EXECUTION COPY
AMENDED AND RESTATED AGREEMENT FOR INDEPENDENT
VERIFICATION OF TELEMARKETING SALES
COME NOW MCI WORLDCOM Network Services, Inc. ("MCIWC") and RMH
Teleservices, Incorporated ("RMH"), and in consideration of the mutual
provisions contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, hereby agree to amend
the Agreement for Independent Verification of Telemarketing Sales effective as
of July 8, 1999, by deleting the contents of that Agreement in its entirety and
replacing it by the contents of this Amended and Restated Agreement for
Independent Verification of Telemarketing Sales, as follows:
THIS AGREEMENT is entered into effective as of July 8, 1999, ("Effective
Date"), by and between MCI WORLDCOM Network Services, Inc. ("MCIWC"), 1200 South
Hayes Street, Arlington, VA 22202 and RMH Teleservices, Incorporated ("RMH"), 40
Morris Avenue, Bryn Mawr, PA 19010.
RECITALS
WHEREAS, MCIWC is a provider of telecommunications services and acquires
new customers for its services through solicitation over the telephone, direct
response, direct sales and other acquisition methods; and
WHEREAS, MCIWC desires to have an independent third party (one in which
MCIWC holds no equity ownership and one which performs no sales functions for
MCIWC) perform independent third party confirmation and verification procedures
("TPV") for MCIWC residential and small business long distance, local toll and
local service sales at facilities in Brantford, Ontario ("Brantford"), Sergeant
Bluff, Iowa ("Sergeant Bluff"), Austin, Texas ("Austin"), Colorado Springs,
Colorado ("Colorado") and such other additional locations as the Parties might
mutually agree upon; and
WHEREAS, RMH desires to contract with MCIWC to perform this independent TPV
function.
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, MCIWC and RMH hereby agree as follows:
1. TERM
----
1.1 The term of this Agreement will commence on the Effective Date and will
continue for four years, unless terminated earlier pursuant to the
provisions of this Agreement. Thereafter, this Agreement will be
renewed on a year to year basis unless one Party gives the other Party
at least 90 days written notice of an intention to terminate prior to
the expiration of the original term or any renewal term.
<PAGE>
EXECUTION COPY
2. DEFINITIONS. Defined terms shall have the meanings set forth below
-----------
("Definitions"). Defined terms not appearing below shall have the meaning
set forth elsewhere in the Agreement.
"Abandoned Call" is a Call that was delivered to RMH but not answered by a
Representative prior to disconnect.
"Abandonment Rate" is total Abandoned Calls divided by total Hot Cut
Transfers to RMH.
"Agreement" is this Agreement for provision of Services between MCIWC and
RMH.
"Backlogged Call Records" are the Sales Offered to RMH which can not be
defined as Confirmed Sales, Canceled Sales, or Safety Net Transfers by the
close of business on the day in which the Sales Offered were sold by MCIWC.
After attempting verification for a continuous seventy-two (72) hour
period, or a period to be determined by MCIWC, the call record is dropped.
"Batch Transfer" is the transmission of Customer data relating to as-of-yet
unverified sales from MCIWC to RMH in batch mode for the purpose of
permitting RMH to call these Customers back for TPV purposes. A Batch
Transfer is an alternative mode of verification from Hot Cut Transfer of a
Customer to RMH.
"Complete" is one of the following: a Confirmed Sale; a Canceled Sale; or
the completion of a Safety Net Transfer.
"Calls Handled" is the remainder of Sales Offered less Abandoned Calls.
"Canceled Sales" or "Cancel Sale" is a sale determined by the
Representative to conform to specified MCIWC standards demonstrating that
the Customer has not authorized a switch of his or her long distance, local
toll, or local telephone service for a particular ANI from his or her
previous carrier to MCIWC.
"Confirmed Sale" or "Confirm Sale" is a sale determined by the
Representative to conform to specified MCIWC standards demonstrating that
the Customer has authorized a switch of his or her long distance, local
toll, or local telephone service for a particular ANI from his or her
previous carrier to MCIWC.
"Customer" is a current or potential customer of MCIWC.
"Digital Taping" is the recording of all TPV calls performed by
Representatives for the purpose of creating and storing evidence of a
Customer's authorization to Confirm Sale or Cancel Sale.
"Hot Cut Transfer" is a call that is transferred "live" immediately and
directly to the Representative by an MCIWC sales representative or from the
Representative to an MCIWC sales representative where the Safety Net
Procedure is employed.
2
<PAGE>
EXECUTION COPY
"MCIWC Management" is MCIWC personnel responsible for overseeing the
operations under this Agreement.
"MCIWC Quality Monitoring Team" is MCIWC personnel responsible for
monitoring the quality of RMH's TPV Representatives.
"National Escalation Center" or "NEC" is responsible for researching and
resolving all Customer complaints lodged against MCIWC or RMH.
"National Verification Team" is responsible for all processes associated
with sales verification, including vendor interface and issue resolution.
"Parties" are MCIWC and RMH.
"Performance Standards" are those performance criteria specified in
Paragraph 6.4. Performance Standards include Completes Per System Hour
Efficiency, Schedule Adherence and Quality Performance Index.
"Representative" is an employee of RMH who has responsibility for providing
the Services at the RMH TPV Center in accordance with the terms of the
Agreement.
"RMH Management" is RMH personnel responsible for Services under this
Agreement.
"Safety Net Transfer" is a procedure to be followed by RMH after a Customer
has indicated that he or she needs more details on a question during the
TPV process. Representatives shall affirmatively ask the Customer if he or
she wishes to be Hot Cut Transferred back to an MCIWC sales representative.
RMH is required to perform this Safety Net Transfer procedure in accordance
with standards established by MCIWC.
"Sale Offered" is a Customer call transmitted from MCIWC to RMH for sales
verification via Hot Cut Transfer or Batch Transfer.
"System Hour" is the call center hour a Representative is plugged into the
system as measured by the ACD and ready to perform the Services. System
Hour does not include sick time, vacation time, jury duty, mealtime, or
anytime the Representative is not performing the Services.
"TPV Center(s)" are the TPV Center operations at Sergeant Bluff, Austin,
Colorado Springs and Brantford.
"Uncalled Backlogged Call Records" are Backlogged Call Records that remain
uncalled by RMH at the conclusion of business each day.
3
<PAGE>
EXECUTION COPY
3. OBLIGATIONS OF RMH
------------------
3.1 Services Description. The services to be provided by RMH at the TPV
--------------------
Center under the terms of this Agreement shall consist of handling,
confirming and independently verifying MCIWC sales forwarded to it by
MCIWC sales representatives and agents and such other services to be
added from time to time by mutual agreement of the Parties (the
"Services"). RMH shall be responsible for providing resident, on-site
management of the Services and shall be responsible for all staffing
and day-to-day labor and employee management. RMH Management shall
maintain daily communication with MCIWC Management and take direction
from MCIWC to ensure that the Services are performed in accordance
with this Agreement.
3.1.1 TPV Regulations. At a minimum, RMH will perform the
---------------
Services which are the subject of this Agreement in accordance
with the sales verification procedures required by federal and
state law and the regulations of the Federal Communications
Commission and/or the state Public Utilities Commission in the
state in which the sale was made.
3.1.2 Independent Status. RMH warrants that MCIWC does not hold
------------------
equity ownership in RMH. RMH also agrees that RMH shall not
perform any sales or marketing services for MCIWC at any time
during the term of this Agreement.
3.1.3 TPV Procedures. RMH shall implement procedures to accomplish
--------------
accurate verification in accordance with instructions from
MCIWC. RMH TPV Representatives shall perform timely and
courteous TPV in accordance with the procedures set forth by
MCIWC and as otherwise mutually agreed upon by the Parties.
These procedures may be supplemented or modified upon notice to
RMH, and RMH will implement any changes as soon as practicable.
RMH shall provide relevant technical and professional advice to
assist MCIWC in establishing policies that maximize the
effectiveness of the MCIWC TPV operation, consistent with
applicable legal constraints.
3.1.3.1 Scripts. RMH shall implement the text scripts the RMH
-------
Representatives must use to perform sales verification
as provided and/or approved by MCIWC. MCIWC may, at
its sole discretion, deliver to RMH amended or revised
sales verification scripts and RMH must notify its
Representatives of such script changes immediately.
3.2 Performance Standards. RMH shall perform sales verification on all
---------------------
Sales Offered by MCIWC in accordance with the Performance Standards
set forth in Paragraph 6.4 herein, and other operational standards as
MCIWC may direct from time to time to further ensure compliance with
this Agreement. Sales to be
4
<PAGE>
EXECUTION COPY
verified include, but are not limited to, inbound and outbound
telemarketing sales, sales received through direct response and direct
mail, and sales received through MCIWC Customer Service. Sales Offered
will be provided to RMH for verification either via live Hot Cut
Transfer or Batch Transfer. RMH agrees to respond in a timely manner
to all escalations related to the Services provided under this
Agreement, whether generated from MCIWC's Quality Monitoring Team or
the National Escalation Center.
3.3 TPV Center. RMH shall manage and operate the TPV Centers in
----------
accordance with the terms of this Agreement. MCIWC may, at its sole
discretion, direct RMH to operate from different and/or additional TPV
Centers upon ninety (90) days written notice, at facilities and upon
terms to be mutually agreed upon. MCIWC may, at its sole discretion,
shut down any non-Brantford TPV Center upon ninety (90) days written
notice, provided that MCIWC reimburses RMH for actual costs relating
to termination, [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
per closed TPV Center. The Parties agree that RMH shall perform the
Services in locations physically separate from MCIWC telemarketing
sales representatives and agents. RMH agrees to cooperate fully with
any third party hired by MCIWC to provide computer systems, voice
response units and other technical aspects related to the Services
under this Agreement.
3.3.1 For the Brantford facility only, RMH will be responsible for
providing at its own cost and with the consent of MCIWC, such
consent not to be unreasonably withheld, TPV Center buildings
and furnishings, leasehold improvements, utilities, office
equipment, local area network ("LAN"), agent desktop computers,
headsets, traffic management/monitor equipment, training
facilities and equipment, facility cleaning and facility
security necessary to perform the Services. RMH will be
responsible for all facility and equipment, both hardware and
software, that is necessary to provide the Services, with the
exception of ACD(s), router(s) and dictaphone(s) which will be
provided by MCIWC. Notwithstanding the foregoing, for all TPV
Centers, RMH will be responsible for the daily operation and
daily maintenance (i.e., maintenance outside of that under any
maintenance agreement contracted for by MCIWC) of the
dictaphone(s) during the term of this Agreement.
3.3.1.1 For the Brantford facility only, RMH agrees to provide
MCIWC with mutually agreed upon private MCIWC-
dedicated facility space, to be fully equipped and
functional with network access, ports, analog lines
and telephones. The MCIWC-dedicated facility space
shall consist of at least (a) one MCIWC-dedicated
private office with two work areas and with locks for
MCIWC-only access, except in the case of a safety or
security emergency; and (b) one additional office with
two work areas available on a non-exclusive basis to
include working phone lines and additional analog
lines
5
<PAGE>
EXECUTION COPY
3.3.1.2 For non-Brantford facilities, RMH agrees to provide
MCIWC with mutually agreed upon office space for its
use in the physically separate space RMH utilizes for
Services.
3.3.1.3 RMH will provide MCIWC with unrestricted access,
subject to compliance with RMH's site and security
regulations, to that portion of any facility used to
perform the Services. RMH must provide (a) MCIWC
access adequate to enable MCIWC to do on-site
monitoring; (b) MCIWC Management access to the
facility; (c) MCIWC the right to conduct on-site
inspections of the facility, training sites and
related areas to the extent used by RMH to provide
Services for MCIWC upon reasonable advance notice; (d)
MCIWC the right to conduct tours of the facility for
MCIWC Customers or MCIWC personnel, upon reasonable
advance notice, such tours not to unduly interfere
with RMH's normal business operations; and (e) MCIWC
access to perform maintenance and related work on
MCIWC equipment and software, as necessary in MCIWC's
sole judgment, including during non-business hours.
3.3.2 RMH will be responsible for all costs associated with any
decision RMH initiates to open a new TPV Center or to
consolidate or relocate any TPV Center, unless MCIWC agrees the
Services provided under this Agreement require RMH to open a
new TPV Center. In such case, the Parties will mutually agree
upon cost responsibilities.
3.4 Staffing. RMH shall be solely responsible for hiring, firing,
--------
terminating, managing, training and compensating all personnel
necessary to accomplish timely and accurate verification of MCIWC
sales in accordance with this Agreement and to maintain sufficient
staffing levels at all times to handle Sales Offered and the System
Hour projection supplied by MCIWC each month pursuant to Section 5.1
of this Agreement. RMH shall have sufficient personnel to ensure that
the Services can be offered, at MCIWC's discretion, twenty-four (24)
hours a day, three hundred and sixty five (365) days per year.
3.4.1 At MCIWC's request, RMH will provide in-language staffing at
the Austin TPV Center, or at such other TPV Center as may be
mutually agreed upon.
3.5 Training.
---------
3.5.1 Initial Training. Initial Training, or new hire training time
----------------
is defined as all MCIWC-approved Representative time spent in
the classroom or on scheduled breaks. Initial Training does not
include lunch, sick leave, disability leave, family leave,
vacation, jury duty or military service. Initial Training shall
consist of sixteen (16) hours of classroom training per
Representative.
6
<PAGE>
EXECUTION COPY
3.5.1.1 Initial Training Compensation: Beginning August 16,
-----------------------------
1999, MCIWC will not be charged for Initial Training
provided that the monthly System Hour projections do
not exceed [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT]. Notwithstanding the foregoing, if
Representative attrition in all TPV Centers other than
Brantford during the period from August 16, 1999
through September 30, 1999 exceeds 100 Representatives
more than 27% of Representative headcount as of close
of business August 15, 1999, MCIWC will be obligated
to pay for Initial Training if the monthly System Hour
projection exceeds [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT]. The Initial Training costs
covered by MCIWC will be calculated as described below
in this Section for those System Hour projections
exceeding the [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] or [REDACTED DUE TO REQUEST
FOR CONFIDENTIAL TREATMENT] System Hour threshold
established as of September 30, 1999. MCIWC will pay
RMH [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] for every incremental [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] hour increase in
RMH's projected monthly System Hours over the prior
month, assuming RMH staffs to handle the projected
volumes and after taking into account work days and
Seasonality. Seasonality shall refer to those periods
where Services decrease due to the holiday season,
resulting in a reduced number of working days during
the holiday season months. For example, if the
projected System Hours were [REDACTED DUE TO REQUEST
FOR CONFIDENTIAL TREATMENT] for the month of May and
the projected System Hours for the month of June were
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT],
MCIWC would pay RMH [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] for Initial Training in June,
assuming the same number of work days in each month.
In this example, if in future months RMH's projected
monthly System Hours never exceed [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT], then MCIWC would
not be obligated to pay for additional Initial
Training costs beyond the month of June. If the
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
hour increase in projected System Hours occurs over
more than one month, MCIWC will carry that increase
forward and pay for Initial Training in the month
where the System Hour projection meets or exceeds the
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
increase. For example, if RMH's projected System Hours
were [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] in the month of May, the projected System
Hours were [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] for the month of June and the projected
System Hours were [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] for the month of July,
assuming the same number of work days in each month,
MCIWC would pay RMH [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] in the month of July. In this
example, if in future months RMH's projected monthly
System Hours never exceed [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT], then MCIWC would not be
obligated to pay for additional Initial Training costs
beyond the month of July.
3.5.2 Ongoing Training. Upon pre-approval and at no
----------------
additional cost to MCIWC, RMH will conduct two (2)
hours of ongoing MCIWC-specific training per
Representative per month. Pre-shift meetings and
routine training will not count towards this MCIWC-
specific ongoing training. In the event that MCIWC
requires ongoing
7
<PAGE>
EXECUTION COPY
training to exceed two (2) hours per Representative in
a month, MCIWC will pay RMH [REDACTED DUE TO REQUEST
FOR CONFIDENTIAL TREATMENT] per Training Hour for each
hour of ongoing training exceeding an average of two
(2) hours per Representative.
3.6 Reporting. Upon request by MCIWC, RMH shall provide MCIWC with daily
---------
and weekly reporting, in a form prescribed by MCIWC, of all
activities, including but not limited to Sales Offered, Completes
(including Confirmed Sales, Canceled Sales, and Safety Net Transfers),
Backlogged Call Records, Uncalled Backlogged Call Records and
Completes Per Hour. Reporting shall be both for the Services provided
as a whole and broken out by TPV Center and sales channel. Reporting
will also detail statistics on each Representative's productivity,
including, but not limited to, results from the National Escalation
Center rate, Cancelled Sale rate and any monitoring performed by RMH.
At MCIWC's discretion, reporting will be made via email, intranet or
other method deemed reasonable by MCIWC.
3.7 Exclusivity at TPV Center(s). During the term of this Agreement,
----------------------------
RHM and its affiliates agree that they will only perform Services or
similar sales verification activities for MCIWC at the non-Brantford
TPV Centers established for the verification of MCIWC sales, and/or
they will not assign or permit management personnel, employees or
staff that perform Services on behalf of MCIWC under the terms of this
Agreement to perform Services for any other telecommunications company
or house RMH personnel assigned to perform Services on the same floor
where RMH is providing Services for an MCIWC Competitor. This Section
does not apply to those individuals in RMH's management who are not
primarily assigned to any particular RMH client. "MCIWC Competitor"
includes (a) AT&T and its affiliates, Sprint, United
Telecommunications, Inc., Qwest, Nextel, GTE, Allnet, ITT
Communications Services, WorldNet Communications & Technologies, Inc.,
Starnet Corporation, ALC Communications Corporation, or other
interexchange carriers and their affiliates and local exchange
carriers, including without limitation, the Regional Bell Operating
Companies (RBOCs) and Bell Communications Research, Inc. ("Bellcore"),
or (b) any Internet Service Provider.
3.8 Monitoring. RMH shall obtain and hold on file signed consents from
----------
all RMH employees permitting and consenting to unannounced recording
and/or monitoring of Calls Handled and other activities performed on
MCIWC's behalf by MCIWC and/or RMH and/or their agents and auditors,
subject to any applicable state or federal law. RMH agrees to make all
reporting generated by RMH available to MCIWC upon request. To ensure
quality control of the Services being provided to Customers and to
ensure that RMH is meeting the Performance Standards contained in this
Agreement, MCIWC reserves the right (either through MCIWC's Quality
Monitoring Team or through a third party contractor), to remotely
monitor, or monitor on-site, TPV Representative handling of Sales
Offered without prior notice to either RMH or RMH employees and TPV
Representatives.
8
<PAGE>
EXECUTION COPY
3.9 Audit. During the term of this Agreement and for a period three (3)
-----
years after the termination of this Agreement, RMH shall permit MCIWC
and/or its agents or independent auditors, upon no less than five (5)
business days notice, to audit, at MCIWC's expense, RMH's books and
records pertaining to the Services performed on MCIWC's behalf
(including all staffing records at the TPV Centers). RMH shall also
permit MCIWC Management, employees and/or authorized consultants
immediate access to the TPV Centers for any reasonable purpose
including, but not limited to, monitoring, installing or repairing
systems, and repairing external or internal facilities.
3.10 Digital Taping. RMH agrees to perform Digital Taping on all TPV
--------------
calls. RMH shall be responsible for all daily operation equipment
maintenance and daily maintenance (i.e., maintenance outside of that
under any maintenance agreement contracted for by MCIWC), including
but not limited to, monitoring successful recording at each work
station, cleaning equipment and installing replacement tapes, opening
tickets with Dictaphone and MCIWC an all equipment failures, and
documenting all issues on email with the National Verification Team.
RMH warrants that all TPV transactions will be digitally taped and
will provide MCIWC with hard copies of the digital tape recording
within 24 hours of MCIWC's request.
3.11 Warranties:
----------
3.11.1 RMH warrants that the Services provided hereunder will be
performed in a professional manner in accordance with
applicable professional standards and shall comply in all
material respects with the specifications and other
requirements set forth in this Agreement. Further, RMH warrants
to MCIWC that the Services to be delivered or rendered pursuant
to this Agreement shall be of the kind and quality necessary to
perform the terms of this Agreement, and all such Services
shall be performed by qualified persons.
3.11.2 RMH warrants and represents that, to the. best of its
knowledge, it is not currently bound by any other agreements,
restrictions or obligations, nor will RMH assume any such
obligations or restrictions which do or would in any way
interfere or be inconsistent with the Services to be furnished
by RMH to MCIWC under this Agreement.
3.11.3 RMH warrants and represents that it is capable of entering
into this Agreement with MCIWC in all respects.
4. INDEPENDENT CONTRACTOR STATUS
-----------------------------
4.1 RMH will at all times be an independent contractor for Services
performed on MCIWC's behalf pursuant to this Agreement. RMH and its
employees and/or agents shall in no way be, or be deemed to be,
employees of MCIWC. RMH shall be responsible for all staffing and
selection, hiring, firing, disciplinary procedures,
9
<PAGE>
EXECUTION COPY
and other employee relations matters associated with personnel hired
by RMH to perform Services under this Agreement. RMH shall be
responsible for all wages, salaries, benefits, workers compensation,
unemployment compensation and other amounts due RMH employees,
management staff and contractors, as well as the withholding of taxes,
including any applicable employment related-taxes. MCIWC shall not
have any responsibility for any employee-related tax items and shall
be indemnified and held harmless by RMH from any liability, cost or
expenses, including any interest, penalties and attorneys' fees that
may be assessed against or incurred by MCIWC in connection with RMH's
failure to make any such payment. RMH is responsible for all taxes,
licenses, permits and other requirements that may be imposed by
federal, state or local law on its business.
5. OBLIGATIONS OF MCIWC
--------------------
5.1 During the term of this Agreement, MCIWC shall supply RMH with, a two-
month System Hour projection for each TPV Center. The two-month System
Hour projection will constitute a projection of volume for the coming
two-month period. This projection will be finalized in writing for
each upcoming month no later than two weeks prior to each upcoming
month. System Hour projection is provided only for RMH's use for
staffing level purposes, and is not a guaranty or commitment of any
kind of volume levels.
5.2 MCIWC shall be responsible for providing Sales Offered to be verified
by RMH via Hot Cut Transfer and/or Batch Transfer, at MCIWC's sole
discretion.
5.3 MCIWC shall be responsible for providing extended service warranties
and maintenance (outside daily operational maintenance) for dictaphone
equipment provided for Digital Taping performed pursuant to this
Agreement.
5.4 MCIWC shall appoint an MCIWC Administrator to direct activities
pursuant to this Agreement and to manage the relationship between RMH
and MCIWC. The MCIWC Administrator shall be:
Michael Barker
MCI WORLDCOM Network Services, Inc.
6312 Fiddlers Green Circle, 600E
Englewood, Colorado 80111
The MCIWC Administrator may be changed upon written notice from MCIWC
to RMH. The MCIWC Administrator (or his designee) and RMH shall
coordinate and project staff levels, and other aspects related to
performance of obligations under this Agreement.
5.5 MCIWC warrants and represents that it is capable of entering into this
Agreement with RMH in all respects. MCIWC warrants that it does not
hold equity ownership in RMH. MCIWC warrants and represents that it is
not currently
10
<PAGE>
EXECUTION COPY
bound by any other agreement that, by its terms, would preclude it
from performing its obligations under this Agreement. Notwithstanding
the foregoing warranty, RMH will not hold MCIWC in breach of this
Section 5.5 based on MCIWC's Agreement for Independent Verification of
Telemarketing Sales dated December 19, 1996 with TeleQuest Quality
Verification, Inc., which was terminated pursuant to a Wind Down
Agreement dated July 15, 1999.
5.6 With the exception of the Brantford facility, MCIWC shall make
available to RMH, and maintain in operating condition reasonably
comparable to existing RMH facilities, the computer systems and
software, voice response units, furniture and equipment necessary to
run the TPV Centers all at no expense to RMH.
5.7 MCIWC shall perform or cause to be performed whatever construction is
necessary at the TPV Centers at Sergeant Bluff, Austin, Colorado
Springs or elsewhere to render the TPV Centers physically separate
from telemarketing or other sales activities of MCIWC at no expense to
RMH.
5.8 With the exception of the Brantford facility, MCIWC shall pay for all
MCIWC pre-approved utilities, including local telephone services and
access and usage of long distance telephone Services, facility
security, leasehold improvements, facilities cleaning and other
services necessary to operate the TPV Centers. MCIWC will not
reimburse RMH for any expense not approved in accordance with this
Paragraph 5.8. For the Brantford facility, MCIWC will provide all
access and usage of long distance telephone service necessary for RMH
to perform the Services.
5.9 MCIWC will reimburse RMH for all pre-approved employee incentive
rewards so long as such awards are not given in connection with the
achievement of any Sales Confirmed rate.
5.10 MCIWC will ensure that the non-Brantford TPV Centers are available to
RMH on or before August 16, 1999 such that RMH is able to perform
Services in those facilities as of August 16, 1999.
5.11 Upon request of RMH, MCIWC agrees to seek to enforce any terms of its
Wind Down Agreement with TeleQuest Quality Verification, Inc.,
effective July 15, 1999, which inure to the benefit of RMH.
6. COMPENSATION AND PERFORMANCE PENALTIES
--------------------------------------
6.1 MCIWC will compensate RMH at the following rates for actual System
Hours performed by RMH on a monthly basis. For example, if the actual
System Hours performed in the Brantford TPV Center are [REDACTED DUE
TO REQUEST FOR CONFIDENTIAL TREATMENT] in a month and [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] in the non-Brantford TPV Centers,
RMH will charge MCIWC [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] per the [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] Brantford System Hours and [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] per the [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] non-Brantford System Hours. Beginning January
1, 2000, the System Hour rate for the non-Brantford TPV Centers will
be increased by [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT].
11
<PAGE>
EXECUTION COPY
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
In consideration of the facilities and long distance access provided
by MCIWC, System Hour rates for the non-Brantford TPV Centers are
discounted by [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] per
System Hour. The discounted rates are reflected in the table above in
this Section of the Agreement.
6.2 The Parties agree that should minimum wage requirements directly
impacting the Representatives performing Services under this Agreement
increase more than three percent (3%), that new System Hour rates will
be mutually agreed upon.
6.3 RMH will allocate a [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT], payable credit to MCIWC in order to offset operational
costs directly associated with new programs. This payment credit will
be in the form of invoice reductions to be made prior to December 31,
1999, at which time the entire [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] credit will have been received by MCIWC.
6.4 Performance Standards and Penalties. RMH shall perform in accordance
with the following Performance Standards. Upon request by RMH, MCIWC
will provide reporting detailing the basis for its determination of
RMH's achievement/failure to achieve Performance Standards. The
Performance Standard levels will determine incentives or penalties
resulting in an adjustment of the base System Hour rate for the
applicable billing period paid by MCIWC to RMH for the performance of
Services under this Agreement, as follows:
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
At the end of each calendar month, the incentives/penalties assessed
for each measurement will be added and the System Hour rate for that
month will be adjusted accordingly. For example, if the System Hour
Rate is [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] and a
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] incentive was
earned for each measurement that month, the adjusted System Hour rate
will be [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT].
Beginning on the Effective Date, Performance Standards will be
measured; however, penalties/incentives will not be assessed until
September 1, 1999 for Quality Performance Index and November 1, 1999
for the remaining two Performance Standards.
If there is an event that materially changes the ability to adhere to
Performance Standards by more than [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] in any given monthly period, an adjustment to
goals
12
<PAGE>
EXECUTION COPY
will be mutually agreed upon by the Parties. Agreement by MCIWC will
be made via the MCIWC Administrator.
6.4.1 Completes Per System Hour Efficiency: Completes Per System
------------------------------------
Hour are computed based on dividing total Completes by total
System Hours. Completes Per System Hour goals will be
communicated to RMH on a monthly basis and are subject to
change at MCIWC's sole discretion. The maximum
incentive/penalty earned for obtaining Completes Per System
Hour goals will be [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] each month. If RMH exceeds or fails to meet this
particular performance criteria, the following
incentive/penalty will apply as an increase or decrease to the
System Hour rate for that month paid by MCIWC to RMH each
month.
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
6.4.2 Schedule Adherence: Two weeks prior to the start of each
------------------
calendar month, MCIWC will deliver to RMH a Representative
staffing schedule and System Hours projection. RMH will be
required to achieve the staffing schedule/System Hour
projection within the [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] acceptable range per operational hour. Schedule
Adherence scores will be calculated on a daily basis by
dividing the total number of System Hours within the acceptable
range by the total hours of operation. The maximum
incentive/penalty earned for adhering to the staff schedules
will be [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
each day. If RMH exceeds or fails to meet this particular
performance criteria, the following incentive/penalty will
apply as an increase or decrease to the System Hour rate for
that month paid by MCI to RMH. However, no incentive will be
awarded if any [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] or more days in the calendar month fall below
the [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
Schedule Adherence threshold.
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
6.4.3 Quality Performance Index: MCIWC shall evaluate and rank RMH's
-------------------------
quality performance based on Quality Performance Index
standards. These standards are currently QM Scores, Skill Set
Reviews and Escalation Free Rates, as more fully defined below.
On not less than fourteen (14) days
13
<PAGE>
EXECUTION COPY
prior notice to RMH, MCIWC may change the Quality Performance
Standards, add or delete Quality Performance Standards, or
revise the weightings of each Quality Performance Standard, all
at its sole discretion. Currently, RMH will receive scores
ranging from [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] for each of the Quality Performance Index standards
in place for that particular month. Scores greater than
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] reflect
above average performance, a [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] reflects acceptable performance and
scores less than [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] reflect below average performance.
QM Scores: The MCIWC QM Department will assess scores. All
---------
surveys will be scored based on total number of deficit
calls versus total number of perfect calls.
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
Skill Set Reviews: MCIWC will create monthly tests for
-------------------
purposes of assessing knowledge level, which will be scored
by the National Verification Team. A minimum of [REDACTED
DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] of total
Representatives will need to complete the test, with no
Representative taking the test more than once until every
Representative has completed one test.
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
Escalation Free Rate: RMH must maintain an acceptable
----------------
Escalation Free Rate. The Escalation Free Rate is defined
as the total sales handled less total number of escalations
and/or procedural errors validated by the National
Escalation Center or the National Verification Team, divided
by total sales handled.
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
14
<PAGE>
EXECUTION COPY
Each performance measurement score will be totaled for the month
and divided by total possible earnable points, i.e., Quality
Performance Index ("QPI") Score = Earned Points/Total Possible
Earnable Points. For example, if RMH received a total QPI score
of [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] for a
particular month and the total possible positive score than can
be earned for that month was [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT], RMH would receive a [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] increase to the System Hour
rate for that month, as the QPI Score equals [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT].
RMH must maintain a Quality Performance Index rating subject to
the following measures. The maximum incentive/penalty earned for
attaining Quality Performance goals will be [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] each month. If RMH exceeds or
fails to meet this particular performance criteria, the
incentive/penalty set out below will apply as an increase or
decrease to the System Hour rate paid by MCIWC to RMH for that
month.
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]
6.5 RMH will invoice MCIWC monthly within 10 days of month end. Each
invoice will include all billable line items, including any applicable
training, together with any applicable incentive payments or
penalties. Each invoice will be accompanied by supporting
documentation.
6.5.1. Within ten (10) business days of the receipt of the invoice and
accompanying documentation MCIWC will determine RMH's level of
attainment of all Performance Standards. If MCIWC disputes any
portion of the invoice or RMH's monthly performance under the
Performance Standards, MCIWC will notify RMH as to the
particulars of such dispute within ten (10) business days of
the receipt of the disputed invoice and accompanying
documentation. Both Parties will make a good faith effort to
resolve any disputes within fifteen (15) days of receipt of the
notification of dispute.
6.5.2 RMH shall not bill MCIWC for Services later than ninety (90)
days following the end of the month in which such Services are
provided, except for discrepancies arising from errors or
omissions in MCIWC-provided system data.
15
<PAGE>
EXECUTION COPY
6.5.3 MCIWC will immediately process and pay, via wire transfer, the
undisputed portion of RMH's invoice through MCIWC's normal
payment channels, not to exceed thirty (30) days from receipt
of such invoice. If the undisputed portion of RMH's invoice has
not been paid by MCIWC within forty-five (45) days from receipt
of invoice, RMH may assess a late fee of one percent (1%)
monthly.
6.6 MCIWC shall have no minimum obligations of any kind, other than term
commitments as set out herein. Notwithstanding the foregoing, MCIWC
commits to transmitting to RMH [REDACTED DUE TO REQUEST FOR
CONFIDENTIAL TREATMENT] of live agent volume of Sales Offered
beginning August 1, 1999 through August 15, 1999. From August 16, 1999
through April 30, 2000, MCIWC commits to transmitting to RMH [REDACTED
DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] of its live agent volume of
Sales Offered. From May 1, 2000 through termination of this Agreement,
MCIWC commits to transmitting to RMH no less than [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] of live agent volume of Sales
Offered. RMH is not entitled to any compensation for TPV activities
performed for MCIWC except as specifically set forth in this
Agreement.
7. TAPE RETRIEVAL PENALTIES
------------------------
7.1 For all data tapes requested by the FCC, any PUC or the NEC to support
validation of a Sales Offered, RMH will pay to MCIWC [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] per tape that is either
unavailable, inaudible or in poor quality. All data tape requests must
be processed through MCIWC (unless requested pursuant to legal
process). Notwithstanding the foregoing, RMH will not be liable to
MCIWC if it is able to produce an audible tape for the particular date
and time in question, even if a particular call is not recorded
thereon.
7.2 For all data tapes requested by MCIWC that are not delivered within
the 24 hour period set out in Section 3.10, RMH will pay to MCIWC
[REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] per day per tape,
so long as ANI look-up capability is available at the TPV Centers.
7.3 In addition to the indemnification obligations set forth in Section
12.1, RMH will be financially liable for 50% of any fines or penalties
imposed by any Federal, state or local regulatory body due to any
negligent or intentional act or omission by RMH, or breach of any
provision of this Agreement, while providing Services to MCIWC.
Notwithstanding the foregoing, RMH will have no liability under this
Section 7.3 for any fine or penalty imposed by the FCC for MCIWC's
failure to comply with 47 CFR, Part 64, subpart K, Section 64.1150,
subparagraph (c). RMH's liability under this Section 7.3 will be
limited to [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] per
occurrence, with a contract year limitation of liability of [REDACTED
DUE TO REQUEST FOR CONFIDENTIAL TREATMENT].
7.4 Beginning on the Effective Date, RMH must meet the obligations in
Section 7.2; however penalties may not be assessed until September 1,
1999. The penalties in Sections 7.1 and 7.3 may not be assessed until
September 1, 1999.
8. TERMINATION
-----------
16
<PAGE>
EXECUTION COPY
8.1 Either Party may terminate this Agreement for cause for breach by the
other Party of any material provision of this Agreement, provided that
written notice of such breach has been given to the breaching Party
and such breach has not been cured within thirty (30) days after
delivery of such notice.
8.2 Either Party may terminate this Agreement immediately upon written
notice, and without liability to the other, if (a) the other Party
makes an assignment for the benefit of creditors other than
assignments made in the conduct of its day-to-day business or admits
its inability to pay its debts as they come due; (b) proceedings under
any bankruptcy or insolvency laws are instituted against the other
Party or a receiver is appointed for a Party or any of its assets or
properties and such proceedings are not dismissed, discharged, or
stayed within sixty (60) days; or (c) the terminating Party, in its
reasonable discretion, determines that there is a material and adverse
change in the other Party's business or financial condition.
8.3 Either Party may terminate this Agreement, without liability to the
other, in the event of judicial, regulatory or legislative change
rendering performance of this Agreement impossible or illegal. Such
Party shall provide the other with written notice of such termination
as promptly as possible, but in no event less than ninety (90) days
prior to the termination date.
8.4 MCIWC may terminate this Agreement, in whole or in part, immediately
upon notice with no right to cure, if (a) pursuant to Section 6.4,
RMH's performance results in a financial penalty for the same
Performance Standard for three consecutive calendar months or five
months in any twelve-month period; or (b) pursuant to Section 7.1 and
7.2, RMH's performance results in data tape retrieval payments
exceeding [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] each
month for three consecutive months or any five months in a
twelve-month period; or (9) pursuant to Section 7.3, RMH is required
to reimburse MCIWC for five occurrences of fines or penalties within a
twelve-month period or meets or exceeds its contract year penalty cap
of [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT]. Termination
under this Section is subject to RMH's obligation to continue to
perform pursuant to this Agreement at MCIWC's discretion for up to 90
days during a termination transition period.
8.5 In the event there is a change of control of RMH, or any affiliate or
subsidiary of RMH that is performing Services pursuant to this
Agreement, MCIWC may at its election, terminate this Agreement, with
no liability to RMH, by giving RMH written notice of its decision to
terminate this Agreement within fifteen (15) days after MCIWC's
receipt of RMH's notice of its change of control, which notice must be
given immediately upon any agreement to bring about such a change of
control. For purposes of this Section, "change of control" means (a)
any merger or consolidation of RMH with an MCIWC Competitor or another
company with materially adverse interests to MCIWC ("Other Party"),
whether RMH or the MCIWC Competitor or the Other Party is the
surviving entity, and where RMH or the MCIWC Competitor or the Other
Party participates in revenue generating services on behalf of MCIWC
or (b) such other transaction whereby the MCIWC Competitor or the
Other Party acquires more than thirty-five percent (35%) of any
17
<PAGE>
EXECUTION COPY
class of RMH's voting stock accompanied by the right to elect
directors. The termination shall be effective on such date as MCIWC
designates in its notice.
8.6 Should RMH undergo a merger, consolidation, or other transaction
whereby a third-party other than an MCIWC Competitor or Other Party
acquires more than thirty-five percent (35%) of any class of RMH's
voting stock accompanied by the right to elect directors, RMH will
give written notice of same to MCIWC as soon as practicable, but no
later than ninety (90) days prior to the change in ownership.
8.7 MCIWC may terminate this Agreement without cause upon ninety (90) days
written notice. RMH may terminate this Agreement without cause upon
one hundred and twenty (120) days written notice.
8.8 If MCIWC terminates this Agreement pursuant to Sections 8.1, 8.4 or
8.5 during the first [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] of this Agreement, it will pay to RMH [REDACTED DUE TO
REQUEST FOR CONFIDENTIAL TREATMENT] for each month remaining in the
first three years of the Agreement, beginning on the date of notice of
termination. This payment is in consideration of start-up costs
incurred by RMH in connection with the Brantford TPV Center. This
would be the only payment MCIWC would be required to make to RMH upon
termination pursuant to these Sections, other than payments for
Services rendered to and through the termination date.
8.9 If MCIWC terminates this Agreement pursuant to Sections 8.3, 8.7 or
19.1.1, it will pay to RMH [REDACTED DUE TO REQUEST FOR CONFIDENTIAL
TREATMENT] for each month remaining through the initial four year term
of the Agreement, beginning on the date of notice of termination. This
payment is in consideration of start-up costs incurred by RMH in
connection with the Brantford TPV Center. This would be the only
payment MCIWC would be required to make to RMH upon termination
pursuant to these Sections, other than payments for Services rendered
to and through the termination date.
8.10 Notwithstanding anything to the contrary stated above, if MCIWC
terminates this Agreement for any reason, RMH will bear full
responsibility for minimum monthly bill commitments and/or termination
penalties assessed against it by Bell Canada (Stentor Companies) under
the three-year Dedicated Services Agreement for DS-3 access necessary
for RMH to perform the Services, which contract MCIWC entered into as
additional consideration for this Agreement.
8.11 During the period following notice of termination by either Party, and
during the transition period set out in Section 8.4, RMH agrees to
exercise its best efforts to perform an orderly and efficient
transition to a successor provider of Services. During any such
period, RMH agrees that its performance level will not fall below the
lowest level of the Performance Standards. Should RMH fall below the
lowest level of any Performance Standard during such period, it agrees
that any financial penalties set out in Section 6.4 will be doubled.
Effective on the date of any notice of termination given by either
Party, any obligations set out in Section 6.6 will be of no further
force and effect. In lieu of the obligations set out in Section 6.6,
MCIWC will use best efforts to ensure that RMH receives no less
18
<PAGE>
EXECUTION COPY
than [REDACTED DUE TO REQUEST FOR CONFIDENTIAL TREATMENT] of the
average of the previous ninety (90) days live agent volume of Sales
Offered following notice of termination through the termination date.
9. MCIWC PROPERTY/OWNERSHIP OF WORK
--------------------------------
9.1 Unless the Parties otherwise agree in writing, any property including,
but not limited to, documentation, reports, data or other proprietary
information, furnished to RMH by MCIWC or developed by RMH for MCIWC
in performance of this Agreement, is and shall remain the property of
MCIWC.
9.2 RMH agrees that the entire right, title, and interest (including
without limitation the exclusive right to use, reproduce, distribute,
translate, and make derivative works) in any written, photographic,
audio and/or video, software or other materials created, produced or
delivered to MCIWC by RMH for use in TPV-related activities
specifically under this Agreement, and all of their components,
including but not limited to all scripts, training material, and
software. (collectively, "Materials") shall remain in MCIWC and shall
be MCIWC's exclusive property. To the extent permitted under the
United States Copyright Act (17 U.S.C. 101), Materials shall be deemed
"works made for hire", with MCIWC being entitled to assign freely any
copyrights therein. MCIWC shall have the right, at its own expense, to
obtain and to hold in its own name copyrights, registrations or such
other protection as may be appropriate to said Materials, and to any
extensions or renewals thereof. RMH shall give MCIWC or any person
designated by MCIWC, without additional charge, all such information
and shall execute all such additional documents as may be reasonably
required to perfect the rights referred to herein. In the event any
Materials shall not qualify as "works made for hire" within the
meaning of the Copyright Act, RMH agrees to assign and hereby does
assign its copyrights related to these Materials to MCIWC, and shall,
without additional charge to MCIWC and at MCIWC's request, give MCIWC
such information and execute any documents required to vest all such
copyrights in MCIWC. MCIWC and its assigns shall have the full, sole
and continuing right (without any payments or liabilities to any
person) to use, publish, perform, reproduce and distribute throughout
the world any or all portions of the Materials, either as a complete
unit or in segments in any way MCIWC sees fit and for any purpose
whatsoever.
10. CONFIDENTIALITY/PROPRIETARY INFORMATION
---------------------------------------
10.1 RMH agrees that any and all confidential information and/or
proprietary information (including Customer lists, Customer Calling
Card Numbers, Customer name, address and billing data, call detail
and/or financial information, information relating to Customers or
Customer account information, information relating to MCIWC's OCIS,
CARMS, CACS, MENTOR, SERVICELINK and/or Guidefile databases) which by
its nature would reasonably be considered confidential or proprietary,
as well as other material specifically designated by MCIWC in writing
as confidential or proprietary ("MCIWC Confidential
19
<PAGE>
EXECUTION COPY
Information") furnished by MCIWC or disclosed to RMH in the course of
this Agreement shall be and remain MCIWC property. During the term of
this Agreement and for a period of seven years (7) years thereafter,
RMH agrees not to reveal, disclose, divulge, sell, license, exchange,
lease or in any other way transfer this MCIWC Confidential Information
to any third party. RMH shall not use such MCIWC Confidential
Information for any purposes other than the Services to be performed
hereunder without prior express written permission of MCIWC and shall
limit its copying of such MCIWC Confidential Information to such
purposes and shall not disclose any such MCIWC Confidential
Information to anyone except RMH personnel to whom such disclosure is
necessary to carry out the purposes of this Agreement. All such
personnel shall be appropriately notified that any such disclosure to
them is made in confidence and shall be held in confidence. In the
event any such MCIWC Confidential Information must be disclosed by RMH
to a third person for the purpose of allowing RMH to provide the
Services hereunder, RMH, shall, prior to disclosure, obtain MCIWC's
written permission and if permission is granted, shall obtain from the
third person a written agreement regarding the confidentiality and
specific use of the MCIWC Confidential Information, the terms of which
shall be substantially identical to those contained herein. RMH shall
forward a copy of such third person's nondisclosure agreement to MCIWC
upon written request.
10.2 MCIWC agrees agree that any and all confidential information and/or
proprietary information which by its nature would be reasonably
considered confidential or proprietary, or which is specifically
designated by RMH in writing as confidential or proprietary ("RMH
Confidential Information") furnished by RMH or disclosed to MCIWC in
the course of this Agreement shall be and remain RMH property. During
the term of this Agreement and for a period of seven years (7) years
thereafter, MCIWC agrees not to reveal, disclose, divulge, sell,
license, exchange, lease or in any other way transfer this RMH
Confidential Information to any third party. MCIWC shall not use such
RMH Confidential Information for any purposes other than in connection
with the Services to be performed hereunder without prior express
written permission of RMH and shall limit its copying of such RMH
Confidential Information to such purposes and shall not disclose any
such RMH Confidential Information to anyone except MCIWC's personnel
to whom such disclosure is necessary to carry out the purposes of this
Agreement. All such personnel shall be appropriately notified that any
such disclosure to them is made in confidence and shall be held in
confidence. In the event any such RMH Confidential Information must be
disclosed by MCIWC to a third person for the purposes relating to the
provision of Services hereunder, MCIWC shall, prior to disclosure,
obtain RMH's written permission and if permission is granted, shall
obtain from the third person a written agreement regarding the
confidentiality and specific use of the RMH Confidential Information,
the terms of which shall be substantially identical to those contained
herein. MCIWC shall forward a copy of such third person's
nondisclosure agreement to RMH upon written request.
20
<PAGE>
10.3 The provisions of Paragraph 10.1 or 10.2 above shall not apply to
information that was previously known to the receiving Party free of
any obligation to keep it confidential as evidenced by written
records, or information that is or has been disclosed in the public
domain, through no fault of the receiving Party, by third persons who
are under no obligation of confidence to either MCIWC or RMH. In
addition, any combination of Confidential Information disclosed by a
receiving Party, shall not be deemed to be within the foregoing
exceptions merely because individual portions of such combinations
are disclosed or separately known in the public domain or known by
the receiving Party. The receiving Party may disclose confidential
information if obligated by Court order or governmental process after
providing the disclosing Party with prior notice that confidential
information is being sought by legal process.
10.4 The Parties acknowledge that the Confidential Information under this
Agreement constitutes unique, valuable and special trade secret and
business information of the disclosing Party, and that disclosure may
cause irreparable injury to the disclosing Party. Accordingly, the
Parties acknowledges and agrees that the remedy at law for any breach
of the covenants contained in this Agreement may be inadequate, and
in recognition, agrees that the disclosing Party shall, in addition,
be entitled to seek injunctive relief and reasonable attorneys' fees
and other court costs and expenses, in the event of a breach or
threatened breach of any of the provisions of this Agreement, which
relief shall be in addition to and not in derogation of any other
remedies which may be available to the disclosing Party as a result
of such breach under the arbitration provisions of this Agreement.
11. INSURANCE
---------
11.1 RMH shall maintain, during the initial term and any renewal terms
hereof, all insurance and/or bonds required by law and as set forth
herein, including but not limited to: (a) Workmen's Compensation
Insurance as prescribed by the law of the state in which the work is
performed; (b) Employer's liability insurance with limits of at least
Two Million Dollars ($2,000,000) for each occurrence; (c)
Comprehensive general liability insurance and, if the use of
automobiles is required, comprehensive automobile liability insurance
for owned, hired and non-owned automobiles, with limits of at least
Two Million Dollars ($2,000,000) combined single limit for bodily
injury, death, and property damage; (d) Professional Liability and
Errors and Omissions Insurance covering RMH and MCIWC against damages
caused by RMH of at least Two Million Dollars ($2,000,000) per
occurrence; and (e) Fidelity bond coverage, covering acts of employee
dishonesty of at least Two Million Dollars ($2,000,000) per incident;
(f) such other "umbrella" and "excess" policy coverage which RMH or
its parent corporation may have in effect from time to time to cover
the actions of RMH, its employees and agents. MCI WORLDCOM Network
Services, Inc. is to be named additional insured for the purposes of
this Agreement as its interests may appear. RMH shall, prior to the
start of work, furnish, if requested by MCIWC, certificates or
adequate proof of the foregoing insurance. Further, RMH will ensure
that each such certificate shall state that the insurance will not be
canceled
21
<PAGE>
or modified unless MCIWC is given thirty (30) days prior notice of
such modification or cancellation.
11.2 RMH shall be responsible for any loss of or damage to property owned
by MCIWC in RMH's possession or control, where such property has been
lost or damaged due to the negligent acts or omissions of RMH or
RMH's agents or employees, save ordinary wear and tear.
12. INDEMNITY/LIMITATION OF LIABILITY
---------------------------------
12.1 RMH agrees to indemnify, defend and hold harmless MCIWC, its parent
company, subsidiaries, affiliates, employees, agents and assigns from
any and all liability to third parties (including but not limited to
liabilities, judgments, damages, losses, claims, costs and expenses,
including reasonable attorneys fees) arising from (a) a breach by RMH
of its obligations under this Agreement, (b) the acts, errors,
representations, misrepresentations, or negligence of RMH, its
employees, affiliates, or agents, except insofar as such acts,
omissions or performance are in compliance with any policies or
procedures established by MCIWC, (c) any tortious claims premised on
RMH's acts or omissions in the award or transfer by MCIWC to RMH of
TPV business, (d) any claims for breach of any non-solicitation or
non-competition covenant connected to the award or transfer by MCIWC
to RMH of TPV business or (e) violation by RMH of a third party's
trade secrets, proprietary information, trademarks, copyright or
patent rights in connection with the performance of Services under
this Agreement.
12.2 MCIWC agrees to indemnify, defend and hold harmless RMH, its parent
company, subsidiaries, affiliates, employees, agents and assigns from
any and all liability to third parties (including but not limited to
liabilities, judgments, damages, losses, claims, costs and expenses,
including reasonable attorneys' fees) arising from (a) a breach by
MCIWC of its obligations under this Agreement; (b) the acts, errors,
representations, misrepresentations, or negligence of MCIWC, its
employees, affiliates, or agents; (c) any tortious claims premised on
MCIWC's acts or omissions in the award or transfer by MCIWC to RMH of
TPV business; (d) RMH's compliance with any policy or procedure
established by MCIWC; (e) any claims made by employees of TeleQuest
relating to TeleQuest's obligation to provide benefits and payroll
(i) as required by law, including but not limited to any claims under
the Worker Adjustment and Retraining Notification Act, 29 U.S.C. 2101
or (ii) as required by contract, such indemnity limited to claims
arising on or before August 15, 1999; or (f) violation by MCIWC of a
third party's trade secrets, proprietary information, trademarks,
copyright or patent rights in connection with the performance of
Services under this Agreement.
12.3 NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY LOSS OF PROFIT,
SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES
(EXCEPT TO THE EXTENT THAT SUCH DAMAGES FORM PART OF AN INDEMNIFIED
THIRD PARTY CLAIM) THAT SUCH PARTY, ITS EMPLOYEES, AGENTS OR ASSIGNS,
MAY
22
<PAGE>
SUFFER WHICH ARE CAUSED BY OR RESULT FROM THE PERFORMANCE OR
NONPERFORMANCE OF THIS AGREEMENT. None of the payments, fines or
penalties set out in Section 7, above, or any damages or other claims
subject to Section 12.1 (c), above, shall be considered subject to
this provision.
13. INTELLECTUAL PROPERTY/USE OF MARKS
----------------------------------
13.1 Except as expressly provided in this Agreement, nothing in this
Agreement shall be deemed to grant a Party any license, sublicense,
copyright interest, proprietary right or other claim against or
interest in the other Party's copyrights, patents, or other
intellectual property.
13.2 Except as provided in this Agreement, neither Party will use, or
permit their respective employees, agents and subcontractors to use
the trademarks, service marks, logos, trade names or other
proprietary designations of the other Party, or the other Party's
affiliates, whether registered or unregistered, without such other
Party's prior written consent.
14. PUBLICITY AND USE OF MCIWC'S NAME
---------------------------------
14.1 Except as required by law or regulation (including any securities
regulation) or in any legally required document in connection with
the sale of securities, RMH agrees that neither RMH nor any of its
subcontractors shall, without the prior written consent of MCIWC,
such consent not to be unreasonably withheld, make any news release
or public announcements, confirmation or denial, with respect to the
existence or the terms and conditions of all or any part of this
Agreement or any discussions or negotiations culminating herein, or
the fact or nature of their participation hereunder, or any phase of
any Services provided or activity conducted hereunder including, but
not limited to such information as the location of MCIWC or RMH TPV
Center, number of TPV personnel or any other information, whether or
not confidential, which would relate to or reflect on the nature or
quality of the service MCIWC provides to its Customers.
14.2 Notwithstanding the foregoing, either Party may publish or issue an
announcement intended solely for internal distribution by such Party
or any disclosures required by legal, accounting or regulatory
requirements beyond the reasonable control of the Party, without the
other Party's prior written approval.
15. IMMIGRATION LAWS COMPLIANCE
---------------------------
15.1 RMH warrants, represents, covenants and agrees that it will not
knowingly assign to perform Services under this Agreement any
individual who is an unauthorized alien under the Immigration Reform
and Control Act of 1986 or its implementing regulations.
15.2 In the event any RMH personnel performing Services under this
Agreement or other individual(s) providing Services to MCIWC on
behalf of RMH under this
23
<PAGE>
Agreement, are discovered to be unauthorized aliens under the
Immigration Reform and Control Act of 1986, RMH will immediately
remove such individuals from performing Services and replace such
individuals with individuals who are, to RMH's knowledge, not
unauthorized aliens.
16. ARBITRATION
-----------
16.1 Any dispute arising out of or related to this Agreement, which cannot
be resolved by negotiation between MCIWC and RMH, shall be settled by
binding arbitration in accordance with the J.A.M.S/ENDISPUTE
Arbitration Rules and Procedures, as amended by this Agreement.
Arbitrator selection shall be by mutual agreement, and the Parties
shall make reasonable efforts to select an arbitrator who has
relevant telecommunications industry experience. The costs of
arbitration, including the fees and expenses of the arbitrator, shall
be shared equally by the Parties unless the arbitration award
provides otherwise. Each Party shall bear the cost of preparing and
presenting its case. The Parties agree that this provision and the
Arbitrator's authority to grant relief shall be subject to the United
States Arbitration Act, 9 U.S.C. 1-16 et seq. ("USAA"), the
provisions of this Agreement, and the ABA-AAA Code of Ethics for
Arbitrators in Commercial Disputes. The Parties agree that the
arbitrator shall have no power or authority to make awards or issue
orders of any kind except as expressly permitted by this Agreement,
and in no event shall the arbitrator have the authority to make any
award that provides for punitive or exemplary damages. The
Arbitrator's decision shall follow the plain meaning of the relevant
documents, and shall be final and binding. The award may be confirmed
and enforced in any court of competent jurisdiction. All post-award
proceedings shall be governed by the USAA. This provision should not
be construed so as to prohibit either Party from seeking preliminary
or permanent injunctive relief in any court of competent
jurisdiction.
17. ATTORNEY'S FEES
---------------
17.1 In the event that either Party is required to enforce or preserve any
of its rights hereunder the non-prevailing Party shall pay all of the
prevailing Party's reasonable attorneys fees and costs, including
allocable costs of in-house counsel, incurred in connection with any
such action.
18. TAXES
-----
18.1 RMH is responsible for all taxes, licenses, permits and other
requirements that may be imposed by federal, state or local law on
its business. RMH will be responsible for any consumption taxes,
including GST and provincial sales tax, sales taxes and/or US taxes
imposed due to the sale or import of any equipment necessary to
provide the Services into Canada.
18.2 MCIWC is responsible for the payment of sales, use or other taxes now
or hereafter imposed on the Services by federal, state or local
governments where
24
<PAGE>
such tax is either expressly specified as a liability of a user of
services of the custom is that the user pays such taxes.
19. FORCE, MAJEURE
--------------
19.1 Neither Party shall be liable or deemed to be in default under this
Agreement for any delay or failure to perform resulting from (a)
accidents, fire, labor disputes, acts of nature or other causes
beyond its reasonable control and without its fault or negligence,
(b) acts or omissions of the other Party, or (c) compliance with any
law, regulation ruling, order or requirement of any federal, state or
municipal government or department or agency or court of competent
jurisdiction. The failure or delay of an equipment vendor will not be
considered to be beyond the control of a Party. Any delay resulting
therefrom shall extend performance accordingly or excuse performance,
in whole or in part, as may be reasonable. If either Party becomes
aware of any factor that would cause a delay or failure in its
performance, it must immediately notify the other Party of the
existence of such factor and probable length of continuation thereof
and no Party's failure or delay in performance will be excused under
this provision before such notice is provided.
19.2 If any force majeure situation results in the constructive shut down
of any TPV Center for fourteen business days or more, and RMH is
unable to provide replacement facilities to MCIWC's satisfaction
within such fourteen day period, MCIWC has the right to terminate
this Agreement immediately upon written notice without further
opportunity for cure.
20. NO ASSIGNMENT
-------------
20.1 This Agreement may not be assigned by any Party by operation of law,
or otherwise, except with the prior written consent of the other
Party.
20.2 Notwithstanding Section 20.1, either Party may assign this Agreement,
in whole or in part, to (a) a parent corporation, (b) any company
into which a Party may merge or consolidate or which acquires
substantially all of its assets or stock, or (c) a wholly owned
affiliate of the parent corporation which is of a financial standing
equal to or greater than that of the assignor. Any assignment under
this Section 20.2 shall not require the consent of the other Party,
but the assigning Party shall provide written notice to the other
Party within thirty (30) days of such assignment.
20.3 This Agreement shall be binding upon and inure to the benefit of the
Parties' respective successors and assigns.
21. SEVERABILITY
------------
21.1 If any part of this Agreement proves to be invalid or unenforceable
for any reason, such invalidity will affect only the portion of the
Agreement that is invalid. In all other respects this Agreement will
stand as if such invalid or
25
<PAGE>
unenforceable provision had not been a part thereof, and the
remainder of the Agreement shall remain in full force and effect.
22. WAIVER
------
22.1 The failure of either Party to insist on the strict performance of
any terms, covenants and conditions of this Agreement at any time or
in any one or more instances, or its failure to take advantage of any
of its rights shall not be construed as a waiver or relinquishment of
any such rights or conditions at any further time and shall in no way
affect the continuance in full force and effect of all the provisions
of this Agreement.
23. NO THIRD PARTY BENEFICIARIES
----------------------------
23.1 This Agreement shall not provide any person or entity not a party to
this Agreement with any remedy, claim, liability, reimbursement,
cause of action or other right in addition to those existing without
reference to this Agreement.
24. NOTICES
-------
24.1 Any notice to be given by the Parties must be in writing, and will be
deemed to have been given if delivered personally, if sent by
facsimile with confirmation by an overnight mail service providing a
receipt, or if sent by registered or certified mail to the Parties at
the following addresses or such other address designated by notice.
Any notice will be deemed to have been given on the day it was
received. Any Party may change the address, person or facsimile
number to which its communications are sent by giving notice as
provided for herein.
24.2 Notices to MCIWC shall be addressed to:
MCI WORLDCOM Network Services, Inc.
1200 South Hayes Street
Arlington, Virginia 22202
Attn: Rob Marney
Facsimile: (703) 415-6848
with copies to:
MCI WORLDCOM Network Services, Inc.
6312 Fiddlers Green Circle, 600E
Englewood, Colorado 80111
Attn: Michael Barker
Facsimile: 303-217-4142
MCI WORLDCOM Network Services, Inc..
1200 South Hayes Street
Arlington, Virginia 22202
Attn: Law & Public Policy
26
<PAGE>
Facsimile: (703) 415-7102
24.3 Notices to RMH shall be addressed to:
RMH Teleservices, Incorporated
40 Morris Avenue
Bryn Mawr, Pennsylvania 19010
Attn: Noah Asher
Facsimile: 610-520-5354
with a copy to:
RMH Teleservices, Incorporated
Wolf, Block, Schorr & Solis-Cohen
1650 Arch Street
Philadelphia, Pennsylvania 19103
Attn: Jay Dubow, Esq.
Facsimile: 215-977-2334
25. COMPLIANCE WITH LAW
-------------------
25.1 At all times during the term of this Agreement, RMH shall fully
comply, and be and remain in compliance, with all applicable laws,
rules and regulations, and the terms of this Agreement relating to or
affecting the performance of its obligations hereunder, including but
not limited to laws related to employment of labor, hours of labor,
working conditions, payment of wages, and payment of taxes, such as
unemployment, social security and other payroll taxes, and shall
secure and maintain in full force and effect all licenses, permits
and authorizations necessary for the performance of its obligations
hereunder.
25.2 At all times during the term of this Agreement, MCIWC shall fully
comply, and be and remain in compliance with all applicable laws,
rules and regulations, and the terms of this Agreement relating to or
affecting the performance of its obligations hereunder, and shall
secure and maintain in full force and effect all licenses, permits
and authorizations necessary for the performance of its obligations
hereunder.
25.3 Each Party shall immediately notify the other Party in writing of the
commencement or threatened commencement of any action, suit or
proceeding, and the issuance or threatened issuance of any order,
writ, injunction or decree, involving its activities under this
Agreement which may affect its ability to perform its obligations
hereunder.
26. APPLICABLE LAW
--------------
26.1 This Agreement shall be interpreted, construed and governed by the
laws of the State of New York, without regard to its conflict of law
provisions.
27
<PAGE>
27. ENTIRE AGREEMENT
----------------
27.1 This Agreement constitutes the entire Agreement between the Parties
with respect to the subject matter hereof and all prior agreements
and representations of the Parties related to these matters, whether
written or oral, are merged herein and shall be of no further force
or effect. This Agreement cannot be changed or modified except in
writing signed by both Parties.
28. HEADINGS
--------
28.1 The Paragraph numbers and captions appearing in this Agreement are
inserted only as a matter of convenience and shall not be construed
to define or limit any of the terms herein or affect the meaning or
interpretation of this Agreement.
29. NONSOLICITATION
---------------
29.1 MCIWC agrees that it will not hire any exempt employee of RMH
performing Services under this Agreement, except with the written
approval of RMH, during the term of this Agreement and for six (6)
months following termination or expiration of the Agreement.
29.2 RMH agrees that it will not hire any exempt employee of MCIWC who has
been assigned to work with RMH in connection with the Services RHM is
performing under this Agreement except with the written approval of
MCIWC, during the term of this Agreement and for six (6) months
following termination or expiration of the Agreement.
IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the
date
28
<PAGE>
set forth above.
MCI WORLD COM Network Services, Inc.
By /s/ Victor Haber
-----------------------------------
Name: Victor Haber
---------------------------------
Title: Vice President of Finance
--------------------------------
RMH Teleservices, Incorporated
By /s/ Noah Asher
------------------------------------
Name: Noah Asher
---------------------------------
Title: Executive Vice President
and Chief Financial Officer
--------------------------------
29
