<PAGE> 1
EXHIBIT 10.17
PentaStar Communications, Inc. has applied for Confidential treatment for
portions of this exhibit 10.17. An asterisk (*) indicates those portions that
have been omitted pursuant to the request for confidential treatment. A complete
copy of this exhibit has been filed separately with the Securities and Exchange
Commission. A "#" indicates term omitted because it is not part of contracts as
amended.
AUTHORIZED DISTRIBUTOR AGREEMENT
BETWEEN AMERITECH
AND
Telecomm Industries, Inc.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<S> <C>
Business Purpose...............................................................................1
Recitals.......................................................................................1
ARTICLE 1......................................................................................1
APPOINTMENT OF DISTRIBUTORSHIP and AD REPRESENTATION......................................1
ARTICLE 2......................................................................................3
TERRITORY.................................................................................3
ARTICLE 3......................................................................................4
EXCLUSIVITY...............................................................................4
ARTICLE 4......................................................................................4
TERM AND TERMINATION......................................................................4
ARTICLE 5......................................................................................6
AUTHORIZED DISTRIBUTOR DUTIES.............................................................6
ARTICLE 6......................................................................................8
AMERITECH'S DUTIES........................................................................8
ARTICLE 7......................................................................................9
SALES AND COMMISSION......................................................................9
ARTICLE 8.....................................................................................11
THE PARTIES' RELATIONSHIP................................................................11
ARTICLE 9.....................................................................................11
FACILITIES AND MATERIALS.................................................................11
ARTICLE 10....................................................................................12
TRADEMARKS AND TRADE NAMES...............................................................12
ARTICLE 11....................................................................................13
OWNERSHIP OF INFORMATION AND CONFIDENTIALITY.............................................13
ARTICLE 12....................................................................................15
RIGHT TO SET-OFF.........................................................................15
ARTICLE 13....................................................................................15
RIGHT TO AUDIT AND INSPECT DISTRIBUTOR'S RECORDS.........................................15
ARTICLE 14....................................................................................15
AGREEMENT NOT TO COMPETE.................................................................15
ARTICLE 15....................................................................................16
NOTICE...................................................................................16
ARTICLE 16....................................................................................17
ASSIGNMENT...............................................................................17
ARTICLE 17....................................................................................17
GENERAL TERMS............................................................................17
Exhibit A TERRITORY......................................................................19
Exhibit B PRODUCTS.......................................................................20
ATTACHMENT 1: VOICE NETWORK PRODUCTS AND SERVICES.......................................21
ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES.......................................22
ATTACHMENT 3: USAGE PRODUCTS AND SERVICES...............................................23
ATTACHMENT 4: OBJECTIVE RETIREMENT PRODUCT LIST (BY PRODUCT FAMILY).....................24
ANNEX 1: VOICE NETWORK PRODUCTS AND SERVICES........................................25
ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES........................................26
ANNEX 3: USAGE PRODUCTS AND SERVICES................................................27
Exhibit C COMMISSION.....................................................................28
1.0 General.............................................................................28
2.0 Commission Set Off..................................................................31
3.0 Upon Termination....................................................................31
4.0 Commission Calculation Methodology..................................................32
5.0 Sales Outside of Territory and Sales Outside
of "Objective Territory".......................................................33
6.0 Partnering..........................................................................33
7.0 Centrex Product Family..............................................................33
8.0 Ameritech FeatureLink...............................................................37
9.0 Other Voice Products................................................................37
10.0 Ameritech SmartFax Connections.................................................38
11.0 Ameritech 9-1-1 Locator ID.....................................................39
12.0 Eligible Standard Data Products................................................39
13.0 ValueLink Products.............................................................42
14.0 1-800-CONFERENCE...............................................................54
15.0 Ameritech Prepaid Products.....................................................55
Exhibit D CO-OP AND 5-STAR PROGRAM.........................................................56
Exhibit E CODE OF BUSINESS CONDUCT.........................................................57
Exhibit F HOUSE ACCOUNTS...................................................................58
</TABLE>
<PAGE> 3
AUTHORIZED DISTRIBUTOR AGREEMENT
BETWEEN AMERITECH
AND
Telecomm Industries, Inc.
This Authorized Distributor Agreement ("Agreement") effective January
1, 1999 by and between Ameritech Information Systems, Inc. a Delaware
corporation with offices at 225 West Randolph, Chicago, IL 60606 (hereinafter
"Ameritech") and Telecomm Industries, Inc., with offices at 1743 Quincy Street,
Suite 143, Naperville, IL 60540 (hereinafter "Authorized Distributor" or "AD").
Business Purpose
Ameritech and AD have entered into this Distribution Agreement for the
purpose of facilitating the marketing and sale of Ameritech retail products, the
servicing of Ameritech retail business customers in the Territory, and to
provide market coverage and market penetration of Ameritech retail products to
retail, business customers in the Territory. The sales made by AD hereunder
shall always be at prices and rates Ameritech sets as retail prices for its
business customers. It is the intent of the parties hereto that both parties
will benefit from this Agreement and the relationship established herein.
Recitals
WHEREAS, Ameritech is engaged in providing telecommunications products and
services and desires to appoint distributors to market and sell its Products (as
hereafter defined);
WHEREAS, AD represents and warrants that it is qualified to market and sell
Ameritech's Products and has sufficient knowledge of Ameritech's products to
do so;
NOW, THEREFORE, in consideration of the covenants set forth herein, the
parties agree as follows:
ARTICLE 1
APPOINTMENT OF DISTRIBUTORSHIP and AD REPRESENTATION
Section 1.1 Grant. Subject to the terms and conditions of this
Agreement, AD is hereby appointed as an authorized distributor of Ameritech
Products (as hereinafter defined) in the geographic Territory (as hereinafter
defined). For purposes of this Agreement, the activities of marketing, promoting
and selling Products, and the servicing of customer accounts pursuant to the
terms of this Agreement shall collectively be referred to herein as "Distribute"
or "Distribution". AD's right to Distribute is limited to the Distribution of
Products which are expressly defined as "Products" under Exhibit B, and in the
"Territory" under Exhibit A, both Exhibits hereby incorporated by reference
herein as modified from time-to-time. "Territory" for purposes of this
Agreement means collectively the geographic area, area codes and Ameritech
business units which are specified on Exhibit A.
Section 1.2 Non-exclusive. Nothing contained herein shall be construed
to prohibit Ameritech from selling or servicing any of Ameritech's Products or
other products and services in the Territory. In addition, Ameritech reserves
the right to appoint others to Distribute its products and services in the
Territory, and to send its own or third party technical or sales personnel to
any place inside or outside the Territory to assist its distributors or
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independent sales representatives in contacting customers (potential or
otherwise), servicing accounts, soliciting business, or promoting the sale of
its products and services.
Section 1.3 Parties' Relationship. The parties' relationship is set
forth under Article S of this Agreement. AD shall not use any sales person to
perform on its behalf hereunder unless said sales person has been registered by
Ameritech as qualified to Distribute its Product. Ameritech reserves the right
to set minimum qualification levels for sales personnel at its sole discretion
and Ameritech will notify AD in writing of all such qualifications.
Section 1.4 No Authority to Bind. AD shall have no authority to bind
Ameritech by contract or otherwise, or make representations as to policies or
procedures of Ameritech other than as specifically and expressly authorized by
this Agreement.
Section 1.5 Third Parties and Sub-Distributors. The AD hereby
acknowledges and agrees that Ameritech has the sole and exclusive right to
appoint and authorize others to function and represent themselves as Ameritech
Authorized Distributors or Authorized Sales Representatives. The AD shall not
delegate its appointment or in any way authorize anyone to distribute or
represent themselves as an agent of Ameritech or as an Ameritech Authorized
Distributor or as an Ameritech Authorized Sales Representative. In the event AD
utilizes independent sales representatives to perform on AD's behalf hereunder,
such sales representatives must at all times represent themselves as sales
representatives of AD and not as Authorized Distributors of Ameritech. Ameritech
shall not be liable to pay any fees or compensation to any independent sales
representative acting on behalf of AD, or to pay any other party, including, but
not limited to the AD, for sales generated by any unauthorized representative.
In addition, processing orders for unauthorized or unregistered
individuals shall be deemed a material breach of this Agreement, and in such a
case Ameritech may terminate this Agreement immediately for cause, and pursue
all other rights or remedies it may have in law or equity.
Section 1.6 AD Responsibility. AD shall be held responsible for the
actions or omissions of each sales representative acting on its behalf, whether
the sales representative is an employee, agent or independent sales
representative of AD. The AD shall require that its employees, agents,
contractors and representatives comply with the requirements of this Agreement
to the same extent as the AD has agreed to comply, including without limitation,
the obligations hereunder regarding Ameritechs logo and other marks (See Article
10), and the ownership and confidentiality of information (See Article 11)
Section 1.7 House Accounts. Ameritech reserves the right to identify
certain accounts as "House Accounts, and AD is not authorized to, and shall not
Distribute Products to such accounts. A list of House Accounts is set forth
under Exhibit F of this Agreement, incorporated by reference herein, and
Ameritech, at its sole discretion, may modify Exhibit F from time-to-time via
the " *" web site and bulletin board, and each modification
will be deemed incorporated herein as if originally set forth herein, and the
modification shall be effective on the date the modification is posted on the
web site and bulletin board
a) In the event Ameritech newly designates an account as a House
Account, AD will have ninety (90) days from the date of such designation to
close all pending sales activity, and AD will be paid commission for sales made
to that account within said ninety (90) day period. To be eligible for this
exception to the House Account rule, AD must notify Ameritech in writing within
three (3) business days of the new designation by Ameritech that AD has pending
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sales activity on that account. The writing must include the account name,
telephone number, the Product(s) being marketed, and the current stage of the
sale AD will not be awarded commission under this subsection on any sale made to
a House Account after ninety (90) days from the date the account is so
designated.
Section 1.8 Retail Business Customers; Retail Business Prices - The
parties hereto acknowledge and agree that this Agreement is for the purpose of
Distribution of Products to Ameritech's retail business customers at prices and
rates Ameritech deems as its retail prices or rate for sales to business
customers. For purposes of this Agreement "retail customer" shall be determined
by Ameritech in its sole discretion. Unless an exception applies, if an account
is "marked" by Ameritech according to its practices and procedures as assigned
to Ameritech's general business services or custom business services divisions,
the account is deemed to be a retail business customer by Ameritech.
Section 1.9 End User of Product In no event is AD granted the right or
authority under this Agreement to distribute Products to anyone whom the AD
knows, or should have known, at the time of sale or within two (2) years
thereafter, is: a) not the end user of the Product; b) subscribing to the
Product for the purpose of reselling it to retail customers; or, c) is not
designated by Ameritech CBS as a "retail" customer of Ameritech
Section 1.10 Reseller of Ameritech Products AD is prohibited from
acting as a reseller of Ameritech products and services as that term is defined
under applicable law or as it is used in the telecommunications industry, or
acting on behalf of a reseller of Ameritech products and services.
Section 1.11 Sole Agreement Ameritech utilizes various channels to
Distribute Product to its retail business customers, and Ameritech's strategy
prohibits cross-over appointments between its channels. Therefore, AD is
prohibited from acting as an Ameritech Enhanced Service Provider, an Authorized
Video Sales Representative or to enter into any other Distribution agreement
with Ameritech under which an appointment to market or sell landline Products to
Ameritech's retail customers is granted.
Section 1.12 Accepts Appointment. AD hereby accepts the appointment
granted above and agrees to comply with the terms and conditions of the
appointment as set forth in this Agreement.
ARTICLE 2
TERRITORY
Section 2.1 Geographic Territory. The AD'S non-exclusive geographic
Territory is set forth in Exhibit A, which is incorporated by reference herein.
During the term of this Agreement, Territory may be expanded or contracted
provided the change is in writing and signed and dated by both parties. In some
cases, expansion of Territory will be deemed by Ameritech to constitute an
addition of a Branch Location, and the conditions set forth in Section 2.3 below
will apply.
Section 2.2 Out-of-Territory Sale. Ameritech and AD may, in certain
cases, agree that AD will have the right to Distribute Product to an individual
customer outside the Territory Such arrangement must be in writing, and signed
and dated by Ameritech prior to any sale, and the writing must include, at a
minimum, where and to whom the sale will he made, and the commission payment, if
any, which will apply to any sale made pursuant to that agreement. No commission
will be paid without such a writing.
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Section 2.3 Branch Locations. At all times during this Agreement, AD
must maintain in the Territory a physical presence and a formal place of
business from which it carries out its Distribution activities. If AD desires to
Distribute Products outside the Territory or if AD desires to add an additional
business location within the Territory, AD must receive prior written approval
from Ameritech, and said location(s) may be considered "Branch Locations" for
purposes of this Agreement.
Ameritech's approval of any Branch Location may be conditioned, at its
sole discretion, on one or more of the following:
(a) AD enters into a separate Distribution Agreement with Ameritech
whereby Ameritech makes a separate grant of appointment in the new Territory;
(b) AD's annual sales objective level under this Agreement is modified
by Ameritech to recognize the opportunities in the new Territory(ies);
(c) AD establishing a physical presence in the new geographic area;
(d) AD submits to Ameritech satisfactory written documentation
regarding the AD's proposed activities and objectives for the marketing and
sales of the Products as a result of the Branch Location. Said documentation
will be deemed satisfactory at Ameritech's sole discretion. This factor is to
ensure that expansion by the AD will not adversely affect the market coverage
Ameritech expects in the Territory then assigned to AD; and,
(e) Ameritech reserves the right to base its approval on other relevant
business factors which are particular to the AD's request for a branch location.
Section 2.4 Material Breach. Any violation by AD of the provisions and
conditions of this Article 2 will constitute a material breach, and Ameritech
may terminate this Agreement immediately for cause.
ARTICLE 3
EXCLUSIVITY
Ameritech values its customer relationships, and, as provided elsewhere
in this Agreement, intends to share with AD Ameritech Confidential Information
regarding its customers and customer relationships, including, but not limited
to, business and product plans, customer relationship information and other
sensitive customer data. In the event Ameritech knows or has a reasonable belief
that the AD is marketing, selling or in some way promoting the sale and customer
use of intraLATA telecommunications services, or Prepaid Phone Card, or audio
conferencing and bridging services, or any product or service which is
competitive with a Product, and unless such activity is expressly provided for
elsewhere in this Agreement, Ameritech may terminate this Agreement for cause
immediately. Ameritech's right to terminate under this Article is in addition to
any other right or remedy it may have at law or equity.
4
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ARTICLE 4
TERM and TERMINATION
Section 4.1 Term. This agreement commences on January 1, 1999 or upon
full execution by both parties, whichever is later. This Agreement will expire
on January 1, 2002 ("Initial Term") unless terminated earlier pursuant to terms
of this Agreement. This Agreement will automatically renew for a subsequent one
(1) year term ("Renewal Term") unless one of the parties elects not to renew,
and provides written notice to the other party no later than ninety (90) days
prior to the expiration of the Initial Term.
If a party exercises this right not to renew, the Agreement will expire
naturally at the end of the Initial Term, and all rights and obligations of the
parties cease on the expiration date.
Section 4.2 Termination.
a) This Agreement may be terminated by Ameritech in whole or in part
without cause and for convenience upon thirty (30) days written Notice to the
AD;
b) This Agreement may be terminated by AD for any reason upon thirty
(30) days written Notice to Ameritech;
c) This Agreement may be terminated immediately where expressly
provided for elsewhere in this Agreement. In such cases, Ameritech will notify
the AD in writing, and the termination shall be for cause, and the effective
date of the termination shall be the date of notice;
d) This Agreement may be terminated by Ameritech for cause in the event
of unsatisfactory performance including, but not limited to, unsatisfactory
sales performance or violation of Section 5.4 of this agreement on the part of
the AD. Ameritech will provide written notice to AD of unsatisfactory
performance, and such notice will provide the period of time available to the AD
to cure the unsatisfactory performance. If AD does not cure in the specified
time, the AD will be given written notice of its termination for cause; and,
e) Notwithstanding the foregoing Sections in this Article, it is agreed
that Ameritech may terminate this Agreement immediately without Notice in the
event of:
(i) an assignment by the AD for the benefit of creditors;
(ii) the institution of voluntary or involuntary proceedings
against the Authorized Distributor in bankruptcy, or under any other
insolvency or similar law which is not dismissed within sixty (60 days;
(iii) the dissolution of the Authorized Distributor;
(iv) an attempted assignment of this Agreement by the
Authorized Distributor without Ameritech's prior written consent as
required under Article 16 of this Agreement;
(v) Ameritech becomes aware of a sale, transfer or
relinquishment of a substantial interest in the ownership of AD, or a
substantial change in management of the AD;
(vi) a Seriously Delinquent status on any AD landline or
PrePaid Product account with Ameritech which is not cured by AD upon
notice of the Seriously Delinquent, and which cannot be cured through
set-off provided for under this Agreement "Seriously Delinquent" is
determined solely by Ameritech at its discretion but in no event will a
delinquency of less than ninety (90) days be considered a "Seriously
Delinquent";
(vii) submission to Ameritech by the AD, its employee,
representative, agent or contractor of any false or fraudulent reports
or statements including, but not limited to, any false or fraudulent
claims for credits or reimbursements under the "Co-Op', "5 Star" or
other similar Ameritech incentive programs; or,
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(viii) submission by AD, its representative, contractor or
agent of a sales agreement or sales order or any other document which
is subsequently found to contain forged customer signatures or the
customer denies any knowledge of placing an order with AD.
(ix) AD violates in any way the terms or limitations of its
appointments as set forth under Article 1, or violates in any way AD's
obligations and duties under Article 5.
Section 4.3 Upon Termination.
(a) Upon expiration or termination of this Agreement, AD shall no
longer be an Authorized Distributor of Ameritech's Products and AD must not
represent itself as such to others;
(b) Upon expiration or termination of this Agreement, AD agrees to
provide to Ameritech a detailed report of all work in progress under this
Agreement within three (3) business days from the termination or expiration of
this Agreement, including, without limitation, pending sales and installations;
(c) Upon expiration or termination of this Agreement, AD shall remove
and return to Ameritech any material, including, without limitation, manuals,
catalogues, brochures, advertising copy, and training materials, or destroy such
materials at Ameritech's sole option;
(d) Upon expiration or termination of this Agreement, the AD shall
remove and discontinue the use of any sign or any other designation containing
any of Ameritech's logos, trademarks or trade names, including, without
limitation, the designation of Ameritech Authorized Distributor" or "Ameritech
Authorized 5-Star Distributor". Should such trademarks or trade names be printed
on any of the AD's business cards, letterhead or other written documents, the
written documents shall promptly be destroyed, and AD must reprint the materials
so as to remove any such trademarks or trade names of Ameritech;
(e) Upon expiration or termination of this Agreement, AD hereby has the
duty to notify all publishers and others who may identify, list or publish AD's
identity or name as a marketer, promoter or supporter of Ameritech Products that
such identification or publication is prohibited as of the date this Agreement
is terminated. For purposes of this Agreement, Publishers means, but is not
limited to, the publisher of telephone directories, yellow pages, association
directories, or membership rolls; and,
(f) Certain Exhibits and Attachments set forth terms which apply upon
termination of this Agreement, and AD and Ameritech hereby acknowledge their
agreement to those terms.
Section 4.4 Account Transfer. Upon termination of this Agreement,
Ameritech, at its sole discretion, will designate itself or another AD to act as
successor to AD in providing Ameritech Products to customers "in progress" at
the time of termination, and to service those customers who subscribed to
Products through AD when this Agreement was in effect.
Section 4.5 Commissions Upon Termination. Upon termination of this
Agreement, Exhibit C governs the treatment of commissions, including, without
limitation, residuals which may apply to AD sales made during the term of this
Agreement.
ARTICLE 5
AUTHORIZED DISTRIBUTOR DUTIES
Section 5.1 Standard of Conduct. The AD agrees to promote, encourage
and increase the sales to, and acceptance by customers of the Products within
the Territory. AD will fulfill this duty in a professional and diligent manner.
AD agrees that Ameritech's business reputation is one of its most
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valuable assets. In performing its duties under this Agreement, AD shall observe
the highest standard of integrity and fair dealing with members of the public.
AD shall do nothing which would tend to discredit, dishonor, reflect adversely
upon or in any manner injure the reputation of Ameritech.
Section 5.2 Application. AD must complete and sign an application form
and return it to Ameritech for acceptance. Ameritech hereby acknowledges that an
application may have already been submitted by AD, and the parties agree that
any prior applications are hereby superceded and replaced by the one which is
submitted pursuant to this Section. Ameritech will review and accept the
application according to its standard practice, and Ameritech will not
countersign this Agreement unless and until an application is accepted by
Ameritech.
Section 5.3 Sales Achievement. The AD shall satisfy minimum monthly,
quarterly and annual sales performance requirements as set forth on the document
titled "AD Annual Objective Sheet and Tier Multiplier" effective January 1,
1999, which has been signed by each party and which is incorporated by reference
herein and which may be modified or amended during the term of this Agreement
upon thirty (30) days written notice by Ameritech to AD, and each such
modification or amendment shall be deemed to have been included as if originally
set forth under Attachment 1.
Section 5.4 Compliance. The Distributor shall comply with all Ameritech
policies, procedures and practices. This includes, but is not limited to:
practices and procedures regarding order and subscriber agreement processing;
accuracy of submitted orders and agreements; Product methods and procedures;
advertising placement and quality rules; commission submission, payment and
inquiry guidelines; Ameritech Identity Guidelines; and, Ameritech Authorized
Distributor Policies and Practices. Notwithstanding the foregoing, AD, its
employees, agents and representatives must comply with all rules, limitations,
procedures and policies related to Ameritech's sales incentive programs such as
5-Star and Co-Op.
Section 5.5 Code of Business Conduct. AD understands and agrees that
any violation of the Ameritech Code of Business Conduct by AD'S employees,
representatives, contractors or agents will be considered by Ameritech a
violation of this duty by the AD.
Section 5.6 Inquiries, Quotations and Customer Relations. AD shall
promptly transmit any customer inquiries regarding any matter related to
Ameritech or its Products to Ameritech in a manner prescribed by Ameritech.
Section 5.7 Customer Information. AD agrees to make available to
Ameritech the names and addresses of all purchasers of Ameritech Products
through AD, and AD agrees that such information is Confidential Information of
Ameritech. The use and disclosure of Ameritech Confidential Information is
governed by the restrictions set forth under Article 11 of this Agreement.
Section 5.8 Financial Statements. AD shall furnish to Ameritech such
financial statements as may be reasonably requested by Ameritech's credit
manager for Ameritech's confidential use in evaluating the AD's ongoing
participation in the AD Program.
Section 5.9 Indemnity. AD agrees to indemnify and hold Ameritech
harmless from any claims or losses, including attorneys' fees and expenses,
which arise out of any act or omission of the AD, its employees, agents,
representatives, or contractors, in connection with or related to the AD's
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marketing, promotion, or demonstration of Ameritech's products or services. In
addition, and not in derogation of the foregoing, AD agrees to indemnify and
hold Ameritech harmless from any claim or loss (including attorneys' fees and
expenses) which arise or is in connection with any statements (whether oral or
written) made with respect to the Ameritech's products or services, and from any
claim or loss which arises from or in connection with any representation or
warranty given, or allegedly given, by AD regarding Ameritech's products or
services, or regarding AD's right to market and sell Ameritech's products and
services, whether such representation or warranty is oral or written, express or
implied.
In addition to, and not in derogation of the above, AD agrees to
indemnify, defend and hold Ameritech free and harmless from any loss, damage,
liability, cost or expense, including legal fees and expenses, for which
Ameritech becomes liable by reason of acts or omissions of AD, its employees,
agents, representatives and contractors during the course of their performance
hereunder, except to the extent that such act or omission was the result of
Ameritech's gross negligence.
Section 5.10 C.P.N.I. AD must comply at all times with Ameritech's
policies on the use of information deemed by Ameritech to be Customer
Proprietary Network Information ("CPNI") under the Telecommunications Act of
1996.
Section 5.11 Duty. AD assumes full responsibility and liability for the
acts of its employees, agents, contractors and representatives, and for their
supervision, daily direction and control. AD shall require compliance with the
duties and obligations of this Agreement to the extent those duties or
obligations apply to the acts of the employee, agent, contractor or
representative.
Section 5.12 Insurance. AD will at all time during the term of this
Agreement, at AD's sole expense, maintain insurance which is appropriate in type
and amount for its performance hereunder, including, but not limited to,
automobile insurance and comprehensive liability insurance against claims for
bodily and personal injury, death, property damage and all other harm caused by
or occurring in connection with AD's, its employees', representatives' and
agents' actions, omissions or misrepresentations. Upon request of Ameritech, AD
will furnish proof which is satisfactory to Ameritech that insurance coverage
required under this Agreement is in effect. Ameritech reserves the right to deem
in its sole discretion whether or not the insurance is "appropriate in type and
amount".
ARTICLE 6
AMERITECH'S DUTIES
Section 6.1 Sales Materials. Ameritech shall from time-to-time furnish
catalogues, brochures, pamphlets, promotional and other materials pertaining
Products to assist AD in promoting and developing the sale and acceptance of the
products and services in the Territory. AD may request additional sales
materials, Ameritech will furnish them, and a charge may sometimes apply.
Section 6.2 Duty to Promote. Ameritech agrees to use reasonable efforts
to promote, encourage and increase the marketing efforts of its Products through
advertising and other marketing initiatives.
Section 6.3 Payment of Commissions. Ameritech shall pay commissions to
AD pursuant to the terms, conditions and schedule set forth under Exhibit C.
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Section 6.4 AD Incentive Programs.
(a) Ameritech will provide Co-Operative advertising funds under its
"Ameritech Authorized Distributor Co-Op Program" ("Co-Op"). The terms,
conditions, limitations and obligations of the parties under the Co-Op program
are set forth in the document titled, "The Co-Op and 5-Star Program" dated
January, 1999 set forth under Exhibit D hereto, which is incorporated by
reference herein. Notice of any modification to the Co-Op program will be made
via the " *" web site and bulletin board, and each modification
will be deemed incorporated herein under Exhibit D as if originally set forth
therein in its entirety. The modification will he effective the date it is
posted by Ameritech on the web site bulletin board. Modification means any
change to the Co-Op program, up to and including discontinuing all or part of
the program.
(b) Partners in Excellence. Ameritech will make available to AD an
incentive program which will allow the AD, at its election and discretion, to
qualify as an "Ameritech 5-Star Distributor", and become eligible for the
benefits associated with that status. On an annual basis Ameritech will provide
AD with the criteria for the "Partner's in Excellence" program ("PIE"), which is
the criteria which will be used to determine if the AD qualifies as an
"Ameritech 5-Star Authorized Distributor" ("5-Star"). If qualified under PIE, AD
may indicate to others its status as a "5-Star" AD, and will receive benefits
associated with the 5-Star status.
ARTICLE 7
SALES AND COMMISSION
Section 7.1 Exhibit C - Commissions. Ameritech agrees to pay AD
commission pursuant to Exhibit C hereto, incorporated by reference herein, as
may be amended from time-to-time. Commissions are earned by AD at the time of
payment by Ameritech. Ameritech's commission payment procedures and practices
are governed by Ameritech AD commission practices and procedures which are
established by Ameritech in its sole discretion, and may be modified by
Ameritech at any time for any reason, including, but not limited to, more
efficient handling of payment inquiries and tracking.
Section 7.2. Sales Within Territory. Ameritech shall pay commission to
AD on sales within the Territory for all Products and will pay commission for
sales out of Territory only if AD has received prior written consent from
Ameritech for such treatment. Sales outside of the Objective Territory
(hereinafter defined) are treated differently from those within the Objective
Territory for purposes of commission, as further described under Exhibit C.
Section 7.3 End Users. As provided elsewhere in this Agreement, AD is
prohibited from selling Product to a purchaser the AD knows or should know is
not, or will not be in the future, the end user of the Product, there fore,
Ameritech will not pay commission on such a sale. Nonpayment of commission is in
addition to any right or remedy Ameritech may have available in law or in equity
for violation of this Section.
Section 7.4 Retail Business Customers. As provided elsewhere in this
Agreement, the purpose of this Agreement is to benefit each party from the sale
of Product to the retail business customers of Ameritech at retail business
prices. Therefore, Ameritech will not pay commission on any product sold to a
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customer who is not designated as a retail business customer by Ameritech, or
which is sold at a rate or price which is not deemed by Ameritech to be a retail
price. Nonpayment of commission under this subsection is in addition to any
right or remedy Ameritech may have available in law or in equity for a violation
of this Section.
Section 7.5 Special Arrangements. Ameritech acknowledges that the
dynamics of the telecommunications industry and the retail business customer
market may result in specialized sales. AD may request unique commission
handling for a specialized sale, and Ameritech reserves the right in its sole
discretion to accept or reject the AD's request, to set the commission payment
the AD will receive if the sale is finalized, and establish the payment
schedule which will apply to such a payment. The decision by Ameritech on a
specialized arrangement is final and not appealable. To be eligible for unique
commission handling, Ameritech must consent in writing to the special
arrangement prior to the close of the sale. No exceptions will apply to this
condition.
Section 7.6 Commission Values. Ameritech is solely responsible for the
determination and calculation of the commission to be paid on an individual
sale, and Ameritech's commission award to AD, absent arithmetic errors, is final
and not appealable. Ameritech reserves the right to pay a commission amount
different from that which is set forth under Exhibit C, provided that
modification is reasonable, and Ameritech reserves the right to establish a
payment schedule for such a commission award.
Section 7.7 Partnering. Ameritech does not discourage its ADs from
working together or with other Ameritech direct sales representatives on a
specific sale if it is in the best interest of Ameritech, provided Ameritech is
notified and approves of such partnering prior to any customer sales proposal.
In the event of such approved partnering arrangements, Ameritech reserves the
right to establish a commission payment value and payment schedule for such a
sale without invalidating any part of this Agreement, and such arrangement shall
not be considered as establishing a precedent. Ameritech in its sole discretion
shall establish the value and commission payment percentages due to each of the
sale partners.
Section 7.8 No Authority to Bind. AD has no authority to bind
Ameritech, and all orders, subscriber agreements and customer contracts are
subject to acceptance by Ameritech in the manner prescribed by Ameritech.
Therefore, AD shall not be paid commission on any sale or order until the
subscriber agreement or order is accepted by Ameritech under the then-in-effect
acceptance procedures. Ameritech's acceptance will not be unreasonably withheld
or delayed. Ameritech as the Product supplier has the right to refuse any
customer order for any reason Ameritech deems sufficient, and AD shall not be
entitled to any commission on any order so refused.
Section 7.9 Discrepancy of Commission Due and Audit. In the event of a
discrepancy between the sales reflected on the Ameritech generated AD commission
report and the sales which AD claims were approved and processed by Ameritech,
AD may request an audit of Ameritech's commission records. The AD may employ
such assistance as it deems desirable to conduct the audit, but may not use the
assistance of: (i) a person or an entity that competes or whose employer
competes with Ameritech; (ii) that is the principal outside auditor of a
competitor of Ameritech (unless such auditor is also the AD's principal outside
auditor); or, (iii) is someone to whom Ameritech reasonably objects to
performing any such audit. AD shall cause any person or firm retained for this
purpose to execute a non-disclosure agreement in favor of Ameritech.
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If the audit reveals that Ameritech made an error in its favor which
totals twenty-five percent (25%) or more of the AD's year to date commissions,
as determined by the most current Ameritech commission report, Ameritech will
bear the expense of the audit, provided that AD submits evidence of actual
expense.
ARTICLE 8
THE PARTIES' RELATIONSHIP
Section 8.1 Independent Representative. The parties agree that the
relationship arising from this Agreement is that of Product supplier and
independent sales representative, and the relationship arising from this
Agreement does not constitute or create an agency, joint venture, partnership,
an employee relationship or franchise between them. AD has no authority to bind
Ameritech in contract or otherwise, or to make representations as to the
policies or procedures of Ameritech other than as expressly authorized by
Ameritech. AD acknowledges and agrees that it is an independent business with
respect to its performance under this Agreement.
Section 8.2 Identification. The AD is and must at all times hold itself
out to be an independent business authorized to act as an authorized distributor
with respect to the Products. Unless expressly and specifically authorized by
Ameritech in writing, AD shall not make any promise, warranty or representation
on Ameritech's behalf with respect to the Products, or any other matter.
Section 8.3 No Fee. AD acknowledges that it has awarded no fee to
Ameritech in connection with the appointment made by Ameritech under this
Agreement.
Section 8.4 Employees. AD, its employees, agents, representatives and
contractors are not and will not be, and shall not be deemed to be, employees or
joint employees of Ameritech, its parent or its affiliates, and shall at no time
be eligible for or apply for eligibility for any insurance or other benefit
available to an employee of Ameritech Corporation, its subsidiaries or
affiliates. Ameritech is not and will not be responsible for worker's
compensation, disability benefits, unemployment insurance, withholding taxes,
social security or any other taxes or benefits for AD, its employees, agents,
representatives and contractors. AD is and shall be responsible for all federal,
state, and local taxes applicable to it, and hereby agrees to indemnify and hold
Ameritech harmless from any claim or liability therefrom.
ARTICLE 9
FACILITIES AND MATERIALS
AD hereby represents and warrants that it has adequate facilities,
equipment, means of transportation, sales force, distribution capabilities, and
business office and clerical staff necessary to perform the services and
activities required by this Agreement. Ameritech reserves the right to obtain
access to AD's facilities for the purpose of examining the adequacy of the
facilities and materials. Such access will be granted by AD provided it is
during AD's regular business hours. AD also represents that none of the above
items have been specifically acquired or obtained for the performance of this
Agreement.
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ARTICLE 10
TRADEMARKS AND TRADE NAMES
Section 10.1 Limited, Non-exclusive License. Ameritech hereby grants
to AD a limited, non-exclusive non-transferable, nonsublicenseable,
royalty-free right to use the AMERITECH trade names, trademarks, and service
marks, (hereinafter, "the Marks") in the Territory in accordance with AD
performance hereunder. This license is conditioned on AD'S complete
compliance with Ameritech's policies, practices and procedures for use of the
Marks, and Ameritech's Identity Guidelines, both which are provided to AD by
Ameritech. In addition, the AD must comply with all applicable governmental
regulations with respect to the Marks. Ameritech reserves the right to inspect,
observe, review and in any way audit the AD'S use of the Marks at any time
during the term of this Agreement, and, if requested by Ameritech, such review
or audit shall take place on AD's premises, and AD grants Ameritech access to
conduct such review during AD's normal business hours.
AD shall not use, and is prohibited from adopting any of the Marks, or
any part of any of the Marks as an Internee domain name, and shall not register,
or seek to register any name or mark anywhere in the world which is identical or
confusingly similar to any Mark, or so similar thereto as to constitute a
colorable imitation thereof or to suggest some association, sponsorship, or
endorsement by Ameritech.
Section 10.2 Ameritech's Rights in Marks. AD will not alter, modify,
dilute or misuse the Marks, bring them into disrepute or challenge Ameritech's
rights in them. AD shall cooperate with Ameritech as may be reasonably
necessary for Ameritech to protect, prosecute or defend its rights with respect
to the Marks.
Section 10.3 Layout Limitations. AD's right to use the designation of
"Ameritech Authorized Distributor" or "Ameritech Authorized 5-Star Distributor"
is limited to the layout and design guidelines which are set forth in
Ameritech's Identity Guidelines. Any use of that designation which is not in
complete compliance with the use requirements and guidelines under Exhibit D
will be considered a material breach of this Agreement, and Ameritech may
terminate this Agreement upon Notice if AD does not cure the breach immediately
and to the satisfaction of Ameritech. Such termination is in addition to any
other right or remedy Ameritech may have available to it at law or equity.
Section 10.4 Ameritech Consent Required. AD will not combine the Marks
with any other marks, names, or symbols without Ameritech's prior written
consent. The AD shall refrain from using any name, trademark, trade name, logo,
slogan, label, title or insignia, or one confusingly similar thereto, now or
hereafter owned adopted or used by Ameritech (whether registered or
unregistered) in any manner, or any medium, or for any other reason than that
approved by Ameritech, and shall refrain from any use in any geographic area
outside of the Territory.
Section 10.5 Substantial Value. AD hereby acknowledges the substantial
value of the Marks and the goodwill associated therewith, and acknowledges that
such goodwill is a property right belonging to Ameritech. AD recognises that
Ameritech is the owner of the Marks, and that nothing contained in this
Agreement is intended as an assignment or grant to the AD of any right, title,
or interest in or to the Marks. AD shall not do anything which is inconsistent
with Ameritech's ownership of the Marks, and all use of the Harks by AD shall
inure to the benefit of and be on behalf of Ameritech. AD hereby
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acknowledges and agrees that its use of the Marks is limited to purposes which
are necessary for its performance hereunder.
Section 10.6 Reproduction. AD agrees that accurate reproduction of the
Marks is uppermost. prior to use, AD must provide Ameritech with approval
samples of all advertising, business cards, letterhead and any other materials
which bear Marks. Ameritech will attempt to answer promptly; if Ameritech does
not respond within sixty (60) days of receipt of such materials (except
advertising), they will be deemed not approved. With respect to advertising, if
Ameritech does not respond within thirty (30) days, the advertising will be
considered approved. AD is prohibited from modifying or changing any such
approved material without first obtaining written approval.
Section 10.7 Discontinue Use. Upon expiration or termination of this
Agreement, AD shall immediately discontinue use of any trademark, trade name,
logo, slogan, label, title or insignia now or hereafter owned, adopted or used
by Ameritech (whether registered or unregistered), and destroy all printed
materials (including but not limited to business cards, letterhead, promotional
and advertising materials, store signage, vehicle signage, and customer premises
stickers and signage) bearing any of the Marks.
Section 10.8 Indemnification. Ameritech shall indemnify and hold AD
harmless from any and all damage or expense resulting from valid trademark
infringement claims with respect to any of the Marks used by the AD pursuant to
this Agreement, provided, however, that; (a) Ameritech is given notice within
ten (10) days after the AD received notice of such claim or suit for
infringement, together with full information with respect thereto, and complete
control of the defense and any settlement thereof; and, (b) AD's use of the
Mark(s) which gives rise to the claim is a permitted use in accordance with this
Agreement.
Section 10.9 No Other Rights. No other rights are granted to AD to use
any trademarks, trade names, service marks or service names of Ameritech or its
affiliates. Further, no licenses, warranties, or indemnifications, express
or implied, under any patents, copyrights, or any trade secrets are granted to
AD.
Section 10.10 Survival. This Article 10 and all its sections shall
survive any termination or expiration of this Agreement.
ARTICLE 11
OWNERSHIP OF INFORMATION AND CONFIDENTIALITY
Section 11.1 Ameritech Confidential Information. Any business and
management information of Ameritech, its parent or its affiliates, including,
but not limited to, reports, product specifications, pricing, product design,
business plans, strategies and practices, marketing or technical information and
data, and information regarding or related to customers, including. without
limitation, customer segmentation strategies and placement, existing customer
account information and history and potential targeted customers, and any
material marked "confidential" or "proprietary" which is furnished or disclosed
by Ameritech or its representative is collectively deemed "Ameritech
Confidential Information". Ameritech Confidential Information of Ameritech is
acknowledged herein by the parties to be a significant asset of Ameritech, and
Ameritech will disclose its Confidential Information for AD to assist AD in its
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performance hereunder. Any Ameritech confidential information which is disclosed
to AD or otherwise learned by AD during the term of this Agreement is deemed the
exclusive property of Ameritech.
In addition, sales information including, but not limited to, the terms
and conditions of standard contracts, sales and operational methods, business
acquisition plans; new personnel acquisition plans; and, other business affairs
of Ameritech and any of its affiliates, are Ameritech "Confidential Information"
and trade secrets.
Section 11.2 Ten Years. During the term of this Agreement and for a
period of ten (10) years thereafter Ameritech Confidential Information shall
not be disclosed by AD to any person except officers and employees of the AD
requiring the information to perform under this Agreement. In no event shall
Ameritech Confidential Information or trade secrets be used for the benefit of
the AD except in connection with performing under this Agreement.
Section 11.3 Bound to the Same Extent as AD. The AD shall require all
officers, employees, agents and representatives to whom that information is
available or disclosed to by AD to agree to protect against disclosure to others
of Ameritech Confidential Information to the same extent as the AD has agreed.
Section 11.4 Liability. The AD shall be liable to Ameritech for damages
caused by any breach of this provision or by any unauthorized disclosure of that
Confidential Information and those materials by its of officers, employees,
representatives and agents.
Section 11.5 AD Confidential Information. Ameritech agrees that it
will protect the disclosure of AD Confidential Information to the same extent it
protects its own Confidential Information. In no event is Ameritech authorized
to disclose AD Confidential Information outside of Ameritech without prior
written approval of AD.
Section 11.6 Limitations. The obligations of this Article 11 shall not
apply to Ameritech Confidential Information which is; (i) available to the
public through no breach of this Agreement; (ii) is required by law or
regulation to be disclosed, but only to the extent and for the purposes of such
required disclosure; or, (iii) is disclosed in response to a valid order of a
court or other governmental body of the United States with proper jurisdiction,
but only to the extent of and for the purposes of such order and only if the AD
first notifies Ameritech of the order and permits Ameritech to seek an
appropriate protective order.
Section 11.7 Ownership of Subscriber Information. To the extent allowed
under law, all subscriber and customer information, which includes, but is not
limited to: subscriber and customer lists' customer's use of products and
services; subscriber billing and related information; and, subscriber and
customer satisfaction information, all of which is collectively referred to
herein as "Subscriber Information" is the exclusive property of Ameritech and is
to be used by the AD only for purposes of this Agreement, and promptly returned
to Ameritech upon termination or expiration of this Agreement. Subscriber
Information is always Ameritech Confidential Information.
Section 11.8 Terms of this Agreement. The terms and conditions of
this Agreement are Confidential Information of Ameritech and AD,
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Section 11.9 Survival. This Article 11 and all its Sections shall
survive the termination or expiration of this Agreement.
ARTICLE 12
RIGHT TO SET-OFF
Ameritech reserves the right to set-off commissions due to AD if any AD
account with Ameritech is deemed by Ameritech to be "Seriously Delinquent"
(defined hereinafter). Ameritech's set-off right is governed by Exhibit C,
Section 2.0. In the event set-off is not adequate for an AD's Seriously
Delinquent accounts, Ameritech's right to terminate is governed by Section
4.2(c).
ARTICLE 13
RIGHT TO AUDIT AND INSPECT DISTRIBUTOR'S RECORDS
During the term of this Agreement and for one (1) year after
termination or expiration of this Agreement, Ameritech reserves the right to
obtain access to and examine fully the books, records and accounts of all
transactions and activities covered by this Agreement upon reasonable notice to
AD and during AD's regular business hours.
ARTICLE 14
AGREEMENT NOT TO COMPETE
Section 14.1 Protection of Ameritech's Customer Relationship. The
parties agree with the Business Purpose of this Agreement which is stated above,
and agree that the commitments of this Article 14 are necessary to maintain this
mutual benefit. The parties agree that this Article 14 serves to protect
Ameritech's legitimate business interest in protecting Ameritech's customer
relationships and Ameritech's customer/subscriber information which is disclosed
to AD solely for successful performance hereunder.
Section 14.2 Term of Non-Compete. During the term of this Agreement
and for a period of one (1) year thereafter, AD and individuals associated with
AD will be privileged to a significant amount of Ameritech Confidential
Information, therefore, AD and its principal(s), director(s), officer(s) and
shareholder(s) (except those holding stock in the AD corporation whose stock is
publicly traded and which is subject to the reporting requirements of the
Securities Exchange Act of 1934 and then only to the extent of owning not more
than ten percent (10%) of the issued and outstanding shares of such
corporation), collectively and individually are bound by the terms of this
Section.
AD and any individual subject to this Section shall not assist or
facilitate the sale or use by a customer of a product or service which is
"competitive" to the Products. For purposes of this Section, "competitive to"
shall mean that the product or service is of a similar type or serves the same
purpose as the Product(s), or performs the same function as the Products, or
provides the customer the same benefit as the Products covered by this
Agreement. This shall mean that an individual subject to this Section shall not
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be employed by, serve as an agent for, or act as a representative or contractor
for a company which sells, promotes or distributes the competitive products or
services in the Territory.
Section 14.3 Equitable Relief. The AL, its shareholders and officers,
jointly and severally acknowledge and agree that the remedy at law for any
breach, or threatened breach, of any of the provisions of Article 14 will be
inadequate, and the AD and its shareholders jointly and severally agree that
Ameritech shall be entitled to such equitable relief as may be available from
any court of competent jurisdiction, and this right shall be in addition to any
other rights or remedies it may have for any violation of these provisions.
Section 14.4 Severability. In the event any of the provisions of this
Article 14 is determined by a court of competent jurisdiction to be in
violation of applicable law for any reason whatsoever, then any such provision
or part of a provision shall be deemed to be automatically amended so as to
comply with applicable law, and not deemed void.
Section 14.5 Survival. This Article 14 and all its Sections shall
survive the termination or expiration of this Agreement.
ARTICLE 15
NOTICE
Section 15.1 Notice. Unless Notice via " *" is
expressly identified as proper communication elsewhere in this Agreement, Notice
or other communication given by one party to the other under this Agreement
shall be deemed sufficient and proper if the Notice is in writing and is
delivered personally, or is sent postage prepaid, first class U.S. Mail, or by
overnight courier, and such Notice shall be deemed received by the other party:
a) three (3) days after the Notice is deposited with the U.S. Postal Service;
or, b) the following business day if sent by overnight courier. Notice will also
be deemed sufficient and proper if sent by facsimile provided the original
notice is sent via postage prepaid, first class U.S. Mail the same day as the
facsimile; if sent by facsimile Notice will be deemed received by the other
party on the date and time shown on the original transmission confirmation sheet
which is electronically generated by the facsimile machine at the time the
transmission is completed. Notice must be directed as set forth below; each
party reserves the right to change the direction of the Notice, and will do so
through proper Notice to the other party.
If to Ameritech If to AD
Ameritech James Lowery
225 W. Randolph, Floor Telecomm Industries
Chicago, Illinois 60606 1743 Quincy Street, Suite 143
Attn: Alternate Channels Naperville, IL 60540
Facsimile Number: 3l2-251-0633 Facsimile Number:
------------------
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ARTICLE 16
ASSIGNMENT
Section 16.1 AD Assignment. This Agreement may not be assigned by AD
without the prior written consent of Ameritech, and such consent will not be
unreasonably denied or withheld. Any attempted assignment in violation of this
Section shall be deemed void. In the event the proposed assignee is an existing
Ameritech AD, Ameritech reserves the right to consent with conditions, including
but not limited to, conditioning consent on acceptance by AD of Territory
modifications or sales objective restructure.
section 16.2 Complying Assignment. In the event of a complying
assignment, this Agreement shall be binding upon and shall inure to the benefit
of the party's respective assigns and successors.
ARTICLE 17
GENERAL TERMS
Section 17.1 Governing Law. This Agreement shall be governed and
construed by the laws of the State of Illinois, as those laws apply to contracts
which are executed and fully performed within that State.
Section 17.2 Counterparts. This Agreement shall be executed in
counterparts and shall not be binding upon Ameritech until each counterpart is
executed by Ameritech and AD. Each party will retain a document with original
signature, and each fully executed counterpart will be considered an original
Agreement.
Section 17.3 Non-Waiver. All rights, remedies and relief available to
Ameritech shall be exercised at Ameritech's sole option. The failure of
Ameritech to enforce at any time any provision of this Agreement, or to exercise
any option which is provided for herein, or the failure of Ameritech to require
performance by the AD of any provision herein, shall in no way affect the
validity of, or act as a waiver of this Agreement, or any part thereof or any
right of Ameritech thereafter to enforce it.
Section 17.4 Incorporation. All Recitals, Exhibits and Attachments and
Annexes are fully incorporated herein, and each modification or amendment
thereto shall be deemed incorporated as if set forth originally therein.
Ameritech reserves the right to modify, add to and amend this Agreement,
including the Exhibits and Attachments hereto upon thirty (30) days written
notice to AD, and the modification, addition or amendment will be effective on
the thirtieth (30th) calendar day after the date the Notice is received by the
AD without the requirement of acknowledgement or any other act by AD.
Section 17.5 Entire Agreement. This Agreement contains the entire
agreement of the parties related to Ameritech's grant of rights as an Ameritech
Authorized Distributor and AD's acceptance thereof, and cancels all prior
agreements, understandings and representations, whether written or oral, express
or implied, and all such prior agreements are hereby deemed terminated by mutual
consent of the parties and all obligations under any such prior agreement are
agreed by each party to be inoperable and unenforceable.
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Section 17.6 Section Headings. All article and section headings and
captions used in this Agreement are for convenience or reference only and are no
intended to define or limit the scope of any provisions in this Agreement.
IN WITNESS WHEREOF, and intending to be legally bound, the undersigned
authorized parties have duly executed this Agreement effective on the date.
Ameritech Information Systems, Inc. Telecomm Industries, Inc.
By: By:
------------------------------- ----------------------------------
Signature: /s/ Steve Mitchell Signature: /s/ James Lowery
Name Typed or Printed: Steve Mitchell Name Typed or Printed: James Lowery
Title: Director Title: CEO
Date: January 22, 1999 Date: December 30, 1998
(The Balance of this Page Intentionally Left Blank)
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EXHIBIT A TERRITORY
This is Exhibit A to the Authorized Distributor Agreement Between
Ameritech and Telecomm Industries, Inc. ("AD") dated January 1, 1999.
AD is hereby granted the right to distribute in the Territory specified
under this Exhibit. AD's right under the Agreement and this Exhibit is
conditioned on full execution of the Agreement and the signature of both parties
at the end of each Exhibit.
Ameritech and AD agree that sales outside of the Territory are not
encouraged and AD's authority to market, promote or sell Ameritech products to
customers outside of the Territory requires prior written approval by Ameritech.
STATE:
AREA CODES*:
If a business unit is not specifically listed below, sales by AD to
customers classified by Ameritech as served by that business unit are considered
"out of Territory" sales for purpose of this Agreement.**
* Any area code split will result in automatic inclusion of the new area codes
unless AD is otherwise notified in writing by Ameritech.
**Key - CBS means customers of the Custom Business Services
business unit
GBS means customers of the General Business Services
unit
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EXHIBIT B PRODUCTS
This is Exhibit B to the Authorized Distributor Agreement between
Ameritech and Telecomm Industries, Inc. ("AD") dated January 1, 1999.
AD is authorized to Distribute the Products specified under the
Attachments only if the following conditions are satisfied: i) the
above-referenced Agreement is fully executed by the parties; and, ii) all
three product family Attachment pages of this Exhibit are fully executed by each
party.
Attachment 4 to this Exhibit specifies which Products retire AD's sales
objective in a Product family. Sales of Products which do not retire the AD's
objective are treated differently for purpose of commission, and such treatment
is specified in Exhibit C.
For convenience purposes only, each product family category is set
forth under its own Attachment to this Exhibit, and each product or service in
that product family category is itemized. AD and Ameritech will appropriately
indicate which Products AD is authorized to Distribute, and will sign and date
each product family Attachment.
The products and services which are identified under the fully executed
Exhibits herein together and collectively constitute the "Product" for purposes
of the above referenced Agreement between Ameritech and AD.
The Attachments are:
Attachment 1 Voice Network Products and Services
Attachment 2 Standard Data Products and Services
Attachment 3 Usage Products and Services
Attachment 4 Objective Retirement Product List (by Product Family)
(The Balance of this Page Intentionally Left Blank)
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EXHIBIT B, Attachment 1
Voice Network Products
ATTACHMENT 1: VOICE NETWORK PRODUCTS AND SERVICES
This is incorporated as Attachment 1 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
Ameritech 1-800-CONFERENCE
Ameritech 9-1-1 Locator ID
Ameritech Caller ID
Ameritech Centrex Service (Includes ISDN Centrex)
Ameritech Custom Calling Services
Ameritech Digital Transport Service-Enhanced (ADTS-E)
Ameritech DSO (except Total Access Service)
Ameritech DS1 (except Total Access Service)
Ameritech FeatureLink
Ameritech ISDN Direct Service
Ameritech ISDN Prime Service
Ameritech Linebacker
Ameritech Local Access Lines
Ameritech PBX Trunks
Ameritech Remote Call Forwarding
Ameritech SmartFax Connections
Ameritech Voice Mail
------------------------------- ------------------------------
Ameritech Signature AD Signature
------------------------------- ------------------------------
Date Date
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EXHIBIT B, Attachment 2
Standard Data Products
ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES
This is incorporated as Attachment 2 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
Ameritech Analog Video Service
Ameritech Asynchronous Transfer Mode Service (ATM)
Ameritech Broadcast Video Service
Ameritech Connectionless Broadband Data Service (CBDS)
Ameritech Digital Transport Service-Enhanced (ADTS-E)
Ameritech DSO (except Total Access Service)
Ameritech DS1 (except Total Access Service)
Ameritech DS3 (except Total Access Service)
Ameritech Fiber Distributed Data Interface Service (FDDI)
Ameritech Fractional DS1 (384) (except Total Access Service)
Ameritech Frame Relay Service (FRS)
Ameritech Host Interconnection Service (AHIS)
Ameritech Internet Access (Dedicated Access over Frame Relay
or CBDS)
Ameritech ISDN Direct Service
Ameritech ISDN Prime Service
Ameritech LAN Interconnect Service (ALIS)
Ameritech Packet Switched Data Service
Ameritech Reconfiguration Service (ARS)
Ameritech Remote Office Access Manager (ROAM)
Ameritech Synchronized Optical Network Service (SONET)
------------------------------- ------------------------------
Ameritech Signature AD Signature
------------------------------- ------------------------------
Date Date
(The Balance of this Page Intentionally Left Blank)
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EXHIBIT B, Attachment 3
Usage Products
ATTACHMENT 3: USAGE PRODUCTS AND SERVICES
This is incorporated as Attachment 3 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
Ameritech 1-800-CONFERENCE
Ameritech 9-1-1 Locator ID
Ameritech Caller ID
Ameritech Custom Calling Services
Ameritech Digital Transport Service-Enhanced (ADTS-E)
Ameritech Linebacker
Ameritech Local Access Lines
Ameritech PrePaid Products
Ameritech PEX Trunks
Ameritech Remote Call Forwarding
Ameritech SmartFax Connections
Ameritech ValueLink Product Family
Ameritech Voice Mail
------------------------------- ------------------------------
Ameritech Signature AD Signature
------------------------------- ------------------------------
Date Date
(The Balance of this Page Intentionally Left Blank)
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EXHIBIT B Attachment 4
Objective Retirement Product List (by Product family)
ATTACHMENT 4: OBJECTIVE RETIREMENT PRODUCT LIST (BY PRODUCT FAMILY)
This is incorporated as Attachment 4 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and Telecomm Industries, Inc. ("AD")
dated January 1, 1999.
The products and services identified in each Annex to this Attachment
will or will not retire an AD's objective fox the product family specified on
the Annex as indicated in the column titled "Objective Retirement".
(The Balance of this Page Intentionally Left Blank)
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ANNEX 1: VOICE NETWORK PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 1 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and Telecomm Industries, Inc.
("AD") dated January 1, 1999.
------------------------------------------------------ -------
Objective
Eligible Products and Services Retirement
------------------------------------------------------ -------
Ameritech 1-800-CONFERENCE Yes
------------------------------------------------------ -------
Ameritech 9-1-1 Locator ID Yes
------------------------------------------------------ -------
Ameritech Caller ID Yes
------------------------------------------------------ -------
Ameritech Centrex Service (Includes ISDN Centrex) Yes
------------------------------------------------------ -------
Ameritech Custom Calling Services Yes
------------------------------------------------------ -------
Ameritech Digital Transport Service-Enhanced (ADTS-E) Yes
------------------------------------------------------ -------
Ameritech DSO (except Total Access Service) No
------------------------------------------------------ -------
Ameritech DS1 (except Total Access Service) No
------------------------------------------------------ -------
Ameritech FeatureLink Yes
------------------------------------------------------ -------
Ameritech ISDN Direct Service Yes
------------------------------------------------------ -------
Ameritech ISDN Prime Service Yes
------------------------------------------------------ -------
Ameritech Linebacker Yes
------------------------------------------------------ -------
Ameritech Local Access Lines Yes
------------------------------------------------------ -------
Ameritech PBX Trunks Yes
------------------------------------------------------ -------
Ameritech Remote Call Forwarding Yes
------------------------------------------------------ -------
Ameritech SmartFax Connections Yes
------------------------------------------------------ -------
Ameritech Voice Mail Yes
------------------------------------------------------ -------
(The Balance of this Page Intentionally Left Blank)
25
<PAGE> 30
Exhibit B, Attachment 4
Annex 2
Standard Data Products
ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 2 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and Telecomm Industries, Inc.
("AD") dated January 1, 1999.
------------------------------------------------------------ ----------
Objective
Eligible Products and Services Retirement
------------------------------------------------------------ ----------
Ameritech Analog Video Service Yes
------------------------------------------------------------ ----------
Ameritech Asynchronous Transfer Mode Service (ATM) Yes
------------------------------------------------------------ ----------
Ameritech Broadcast Video Service Yes
------------------------------------------------------------ ----------
Ameritech Connectionless Broadband Data Service (CBDS) Yes
------------------------------------------------------------ ----------
Ameritech Digital Transport Service-Enhanced (ADTS-E) Yes
------------------------------------------------------------ ----------
Ameritech DSO (except Total Access Service) Yes
------------------------------------------------------------ ----------
Ameritech DS1 (except Total Access Service) Yes
------------------------------------------------------------ ----------
Ameritech DS3 (except Total Access Service) Yes
------------------------------------------------------------ ----------
Ameritech Fiber Distributed Data Interface Service (FDDI) Yes
------------------------------------------------------------ ----------
Ameritech Fractional DS1 (384) (except Total Access Service) Yes
------------------------------------------------------------ ----------
Ameritech Frame Relay Service (FRS) Yes
------------------------------------------------------------ ----------
Ameritech Host Interconnection Service (AHIS) Yes
------------------------------------------------------------ ----------
Ameritech Internet Access
(Dedicated Access over Frame Relay or CBDS) Yes
------------------------------------------------------------ ----------
Ameritech ISDN Direct Service Yes
------------------------------------------------------------ ----------
Ameritech ISDN Prime Service Yes
------------------------------------------------------------ ----------
Ameritech LAN Interconnect Service (ALIS) Yes
------------------------------------------------------------ ----------
Ameritech Packet Switched Data Service Yes
------------------------------------------------------------ ----------
Ameritech Reconfiguration Service (ARS) Yes
------------------------------------------------------------ ----------
Ameritech Remote Office Access Manager (ROAM) Yes
------------------------------------------------------------ ----------
Ameritech Synchronized Optical Network Service (SONET) Yes
------------------------------------------------------------ ----------
(The Balance of this Page Intentionally Left Blank)
26
<PAGE> 31
Exhibit B, Attachment 4
Annex 3
Usage Products
ANNEX 3: USAGE PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 3 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and Telecomm Industries, Inc.
("AD") dated January 1, 1999.
------------------------------------------------------- --------------------
Eligible Products and Services Objective Retirement
------------------------------------------------------- --------------------
Ameritech 1-800-CONFERENCE Yes
------------------------------------------------------- --------------------
Ameritech 9-1-1 Locator ID No
------------------------------------------------------- --------------------
Ameritech Caller ID No
------------------------------------------------------- --------------------
Ameritech Custom Calling Services No
------------------------------------------------------- --------------------
Ameritech Digital Transport Service-Enhanced (ADTS-E) No
------------------------------------------------------- --------------------
Ameritech Linebacker No
------------------------------------------------------- --------------------
Ameritech Local Access Lines No
------------------------------------------------------- --------------------
Ameritech Prepaid Products Yes
------------------------------------------------------- --------------------
Ameritech PBX Trunks No
------------------------------------------------------- --------------------
Ameritech Remote Call Forwarding No
------------------------------------------------------- --------------------
Ameritech SmartFax Connections Yes
------------------------------------------------------- --------------------
Ameritech Valuelink Product Family Yes
------------------------------------------------------- --------------------
Ameritech Voice Mail No
------------------------------------------------------- --------------------
(The Balance of this Page Intentionally Left Blank)
27
<PAGE> 32
Commission
Exhibit C COMMISSION
This is incorporated as Exhibit C to the Authorized Distributor
Agreement Between Ameritech and Telecomm Industries, Inc. ("AD") dated January
1, 1999 (hereinafter the "Agreement").
1.0 General
1.1 Definitions
As used in this Agreement, the following definitions apply:
"AD of Record" shall mean the Authorized Distributor firm credited
with the sale of a new or renewed Centrex System or Prepaid Products.
"Base Commission" shall mean the amount paid upfront to an AD for
sales of Ameritech Products. The base commission may increase as an
AD's objective increases relative to other ADs.
"Billable Revenue" shall mean those Recurring and Non-Recurring
charges which result from the customer service order(s) which result
from the sale submitted by the AD.
"Completed Orders" shall mean a "completed" Status in an Ameritech
service ordering or billing systems.
"Contract Value" or "CV" shall mean the value of the Recurring and
Non-Recurring revenue charges for each product which is used by
Ameritech for purposes of establishing the value of a sale for
commission purposes.
"Eligible Product" or "Product Eligibility" shall mean those Products
the AD is authorized to promote, market and sell under this Agreement
and which are identified fully under Exhibit B of the Agreement. AD is
authorized to sell all the Products, but only sales of those Products
for which AD has an annual sales objective will retire the AD's sales
objective for that product family.
"Migration" occurs when a customer with an existing Ameritech Usage
contract signs a new contract for a different Ameritech Usage product,
and that product is deemed solely by Ameritech to be within the same
product family as the replaced product.
"Netting" is applied to the sale of certain ValueLink products when
existing products such as, but not limited to, Centrex are already
existing at that location of the customer.
28
<PAGE> 33
"New" shall mean the sale of a Product to a Customer who does not
currently have that specific Product and Ameritech in its sole
discretion will determine if customer currently has the Product. To
retire an AD's objective in the applicable product family, the sale
must be made in the AD's Objective Territory and must be an Eligible
Product. In no event will a sale which is classified by Ameritech in
its sole discretion as a Recast, a Renewal, a Renegotiation, a
Migration or an Upgrade be considered a "New" sale for purposes of the
Agreement.
"Non-Recurring Revenue" shall mean those one-time billed charges which
are a result of a sale by AD.
"Objective Bonus" shall mean the amount paid as the Upfront Payment
once an AD exceeds the sales volume thresholds, as those sales volumes
are stated in dollars, and which are related to the AD's annual
product family sales objective in each State. The amount of the
Objective Bonus payment may increase over the term of this Agreement
based upon the AD's objective relative to other ADs' objectives. The
Objective Bonus payment shall apply only to New sales of Products
which retire the objective for its product family in the Objective
Territory.
"Objective Retirement" shall mean the process whereby New sales of
Ameritech Products retire the objectives for the product family. In
the event a Product retires AD's Objective as specified under Exhibit
B, Attachment 4 in more than one product family, New sales of those
products will retire the AD's objective in one, and only one, product
family in the following order (i) Data; (ii) Voice; and (iii) Usage.
Sales of Products which do not retire objective (see Attachments to
Exhibit B) are considered "Sales Without Objective Retirement" for
purposes of this Agreement.
"Objective Revenue" shall mean that dollar amount which is considered
the unit of measure to retire an AD's sales objective in a product
family. Objective Retirement shall equal one month of the Recurring
Revenue associated with the New sale of a Product.
"Objective Territory" shall mean a sales area or region which is a
sub-set of AD's authorized Territory. Objective Retirement is
satisfied only by sales in AD's Objective Territory, and Ameritech in
its sole discretion will establish and assign AD an "Objective
Territory".
"Objective Tier ("Tier")" means that the AD has been assigned to Tier
I, Tier II or Tier III for purposes of commission value calculation
and Objective Retirement. Determining the Tier the AD is assigned is
at the sole discretion of Ameritech.
"Partnering" means that the AD is not the sole sales entity in the
sales effort with a particular customer, and AD markets Product(s) to
a particular customer with another AD or Ameritech sales
representative. AD must receive prior written approval by Ameritech
for each Partnering effort, and commission will not be paid on sales
which result from such efforts without the prior written consent of
Ameritech. Ameritech reserves the right to set commission values for
each partnering arrangement.
29
<PAGE> 34
"Recast/Renewal/Renegotiation" collectively shall mean a sale of Data
or Voice, or a sales which includes data and voice, and such sale is
not classified as a New sale for purposes of Objective Retirement or
Commission Payment purposes. For purposes of the Agreement, a sale
will be deemed a Recast or a Renewal (whichever is appropriate) when a
customer signs new a contract for a Product, and the customer already
subscribes to the same Ameritech product or to an Ameritech product
which is deemed solely by Ameritech to be similar to the Product
covered under the new contract, and the new contract extends the
customer's term commitment for the Product. A sale will he deemed a
Renegotiation when a customer enters into a new contract with
Ameritech for a Product they already subscribe to, and the terms of
the contract are substantially changed from the contract
then-in-effect for that Product, and Ameritech determines, in its sole
discretion that the sale is eligible for commission payment to the AD
at the Renegotiation rate.
"Recurring Revenue" shall mean those monthly charges billed to the
customer for Products as a result of a sale by AD.
"Residual Payment" shall mean the commission payment which is paid by
Ameritech over time, and the time period for payment is established by
Ameritech based on contract term or other factors relevant to the
sale. Ameritech determines the amount and payment schedule in its sole
discretion.
"Takeback" shall mean commission amounts which are forfeited or
returned by the AD as a result of a customer discontinuing its
subscription to the Product(s). In the event the Takeback is
accomplished by the AD returning commissions already paid, Ameritech
will debit the AD's future commission payments by the amount to be
returned. If such a debit does not satisfy the Takeback amount,
Ameritech may demand full payment from the AD immediately.
"Territory" is defined under Exhibit B of the Agreement and the rules
governing payment of commission for sales made to customers outside
the Territory are set forth in the Agreement.
"Upfront commission Payment" shall mean that portion of the total
commission paid to the AD upon Ameritech's verification that the
order(s) associated with the sale are Completed Orders.
"Upgrade" means that a customer signs a contract for an Ameritech
Product to which the customer already subscribes, or for a Product
which Ameritech deems is similar to the Product the customer already
subscribes to, and the new contract is for a term that extends the
customer's contract term beyond the existing contract's expiration
date, and the new contract includes a product commitment which is
larger than that which is in effect at the time of the new contract.
30
<PAGE> 35
"Winback Bonus" shall mean the incremental commission amount paid to
AD because the sale of an Eligible Product is deemed solely by
Ameritech to satisfy Ameritech's criteria to be classified as a
"winback" sale as that term is understood in the telecommunications
industry.
1.2 Earned Date. AD earns the commission on any sale at the time the
commission is paid by Ameritech.
1.3 Commission Amount and Payment Schedules. The commission value and
the time of payment for each sale is based upon a number of factors, first and
foremost is the Product sold and the terms and conditions of this Agreement. To
be eligible for commission on a specific sale, the AD must comply with all
Ameritech practices and procedures, including, but not limited to, those
related to the processing of sales and subscriber agreements by AD, and the
accuracy of each submission by AD. Ameritech reserves the sole right to modify
or change any or all of its practices and procedures related to the AD program,
and will provide AD with a minimum of thirty (30) days prior written notice of
any modification which will affect the AD's own practices or procedures.
Ameritech may elect to serve this Notice via the " # " web site
and bulletin board, and the Notice will be considered given on the date the
Notice is posted by Ameritech on the web site.
1.4 Acceptance by Ameritech. Ameritech reserves the right to accept or
reject any sale submitted by AD, and, accept or deny, in whole or in part, any
request for commission for a specific sale. Ameritech in its sole discretion has
the right to establish the reasonable commission value of any sale.
2.0 Commission Set Off
In the event of a "Seriously Delinquent" on any AD Ameritech account, including,
but not limited to, Ameritech monthly billing statements for service and
Ameritech invoices for CPE, Ameritech may at its sole election, set off the
amount of the delinquency by the amount owed to AD in future commissions,
including, without limitations, Residual Payments. Ameritech's decision to
set-off is final and not subject to appeal. In the event such set-off is
necessary, Ameritech will notify AD in writing of its intent to set off, and
AD'S commission statement will reflect the set-off. In no event will Ameritech
define "Seriously Delinquent" if the delinquency is less than ninety (90) days.
3.0 Upon Termination
3.1 Ameritech Terminates. The parties agree that in the event
Ameritech exercises its right to terminate for convenience as is provided for
under Section 4.2.a of the Agreement Ameritech will, at its sole election, pay
the Authorized Distributor either:
a) Liquidated damages equal to a sum of the following formula;
(The amount of residual commission the AD would be awarded
if all contracts remained in effect through the end of the
contract term then in effect provided the AD remained
eligible for residual
31
<PAGE> 36
payments for those customers contracts for the entire term)
x (times) (the Ameritech net present value discount rate on
the date of termination) x (times) (seventy five percent
(75%), or,
b) Pay on a monthly basis Residual Payment for customer sales
which are in effect and approved for commission on the date
Ameritech terminates the Agreement. Residual Payments will
continue through the expiration date of the customer
contract in effect at the time Ameritech terminates this
Agreement, or until the original expiration date of this
Agreement, whichever is sooner.
3.2 AD Terminates. In the event AD exercises its right to terminate
the Agreement pursuant to the terms of the Agreement, AD is not entitled to any
commission payment after the date of termination. Ameritech agrees that in
extraordinary situations a commission payment after the termination date may be
reasonable, and under such situations Ameritech will deem at its sole discretion
that the AD will receive payment. If such a situation occurs, Ameritech will
provide to the AD in writing the amount and timing of the payment, and the
conditions or limitations on such payment(s).
3.3 Upfront Commission Payment. AD will be eligible for the Upfront
Commission Payment for any sale which is accepted by Ameritech prior to the date
this Agreement is terminated.
4.0 Commission Calculation Methodology
4.1 Calculation Basis. Ameritech will pay commissions on a sale
submitted by AD based upon;
a) The Product sold.
b) Whether the sale is deemed by Ameritech to be: (i) a New
sale or an addition to an existing service; (ii) a Recast,
Renewal or Renegotiation; (iii) a Migration or Upgrade;
c) Whether the AD is the sole sales entity or if sale is the
result of an approved Partnering sale as provided for
elsewhere in this Exhibit; and,
dl The order(s) which are associated with the sale are
Completed Orders.
4.2 Commission Eligibility. In no event will an AD be paid commission
on a sale: (i) outside the Territory unless such a sale is provided for
elsewhere in this Agreement and AD receives prior written consent for such a
sale pursuant to the requirements set forth elsewhere in the Agreement; (ii) of
a product AD is not authorized to sell under the Agreement (i.e., product or
service is not specified in Exhibit B of the Agreement); (iii) made to a
customer the AD is not authorized to sell to, including, but not limited to, an
Ameritech house account, a customer who is not deemed to be a retail business
customer, or a customer who has expressly granted agency to another AD unless
that customer has expressly, in writing revoked such agency; and (iv) to
Ameritech or to an AD or other independent Authorized Ameritech representative.
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<PAGE> 37
4.3 Commission Award Final. Ameritech reserves the right to establish
the commission value for any sale, and that value may, with
reasonable justification, be less than, more than or equal to the
values set forth herein for such sale, or the value previously
paid for similar sales. Ameritech is solely responsible for the
determination and calculation of commission to be paid on any
single sale, and Ameritech's commission determination, absent
arithmetic errors, is final and not appealable.
5.0 Sales Outside of Territory and Sales Outside of "Objective
Territory"
In the event the AD sells Product outside of the Territory and such
sale has received Ameritech's prior written consent, the commission payment for
such sale will be established by Ameritech at its sole discretion.
In the event that AD sells Product for which the AD does not have a
sales objective, (which is deemed a sale outside of Objective Territory), the
sale is subject to a twenty-five percent (25%) reduction in the Upfront
Commission Payment.
6.0 Partnering
Provided a Partnering arrangement complies with the requirements under
Article 7, Section 7.7 of the Agreement, Ameritech will pay commission on such
sales. The general commission payment treatment for a Partnering sale is that AD
will be paid an Upfront Commission Payment equal to fifty percent (50%) of the
Upfront Commission Payment which would be paid for the same sale if no
Partnering took place. If two ADs partner, each will receive this reduction. An
exception to the general commission payment treatment for a Partnering sale when
the Partnering efforts are with an Ameritech GBS Territory Manager, and the
result of the effort is a Data Product sale, the Upfront Commission Payment for
all resulting sales will be twenty-five percent (25%) less than the Upfront
Commission payment for the same sale if no Partnering took place.
7.0 Centrex Product Family
For purposes of the Agreement, Products classified by Ameritech as part
of the Centrex product family will be paid commission pursuant to this Section
7.0.
7.1 Centrex Product Family. The Centrex product family is the
collective term for the following Ameritech Centrex products:
Ameritech Centrex Service (ACS); Indiana Advanced Centrex
Service; ISDN Centrex; and, Individual Case Basis (ICB) Centrex.
7.2 Grandfather and Sunset Offerings. Commission will not be paid on
New sales of an Ameritech Centrex offering which has been
grandfathered or sunset as those terms relate to
telecommunications offerings. Commission will be paid for sales
which are additions to an existing, installed system of a
grandfathered or sunset Centrex offering.
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<PAGE> 38
7.3 New Centrex Sales. Commission on New Centrex system sales will be
paid provided the sale results in a net increase in Centrex
station lines of at least fifteen percent (15%) of the existing
installed system. In Indiana, the Centrex station line net
increase must be at least one hundred percent (100%) of the
existing installed system.
7.4 The Upfront Commission Payment schedule set forth below applies
to New Centrex system sales. The Commission Payments are stated
in terms of one Centrex station line; the actual Commission
Payment for a particular sale will be based on the number of
lines sold, and, the Commission Payment amount will be calculated
by multiplying the rate set forth below for a single Centrex
station line by the total number of station lines sold.
<TABLE>
<CAPTION>
ACS and Indiana Advanced Centrex
--------------------------------
<S> <C> <C> <C>
Month-to-Month 36 Months 60 Months 84 Months
-------------- --------- --------- ---------
* * * *
ISDN Centrex
------------
Month-to-Month 36 Months 60 Months 84 Months
-------------- --------- --------- ---------
* * * *
ICB Centrex
-----------
Month-to-Month 26 Months 60 Months 84 Months
-------------- --------- --------- ---------
* * * *
</TABLE>
Note: ICB Centrex sales for contract lengths greater than 84 months
will be awarded commission based on the 84 month commission award.
7.5 Centrex Station Line Additions
a) Commission for Centrex station line additions to an
existing installed system will be awarded only to the AD of
Record unless Ameritech has approved in writing alternative
treatment of commission payments. Ameritech will determine
at its sole discretion when there is a deviation in this
payment policy.
b) The Upfront Commission Payment for Centrex station line
additions will be 50% of the commission values in the above
schedules. The Upfront Commission Payment for Centrex
station line additions to a system which is grandfathered
or sunset offering will be $20 regardless of type of system
or contract length.
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<PAGE> 39
7.6 Winback Bonus
If the AD makes a Centrex sale which is designated by Ameritech as a
"winback" sale, a Winback Bonus will be paid which will increase the
Base Commission by * .
7.7 Commitment Bonus
If a new Centrex sale results in a contract which commits the customer
to a number of Centrex station lines which Ameritech identifies in the
chart that follows here as the appropriate number of lines based upon
the number of lines sold, the AD will be eligible to receive the
commitment bonus. The commitment bonus increases the Upfront Commission
Payment by fifteen percent (15%). Ameritech, in its sole discretion,
will determine if a sale is eligible for the Commitment Bonus. The
following schedule will be used to determine the applicability of the
commitment bonus for ACS and ISDN Centrex.
<TABLE>
<CAPTION>
Number of Lines Sold Number of Lines Committed
-------------------- -------------------------
<S> <C>
2 - 7 2
8 - 25 7
26 - 50 25
51 - 100 50
101 - 200 100
over 200 200
</TABLE>
The following schedule will be used to determine the applicablity of the
Commitment Bonus for Indiana Advanced Centrex:
<TABLE>
<CAPTION>
Number of Lines Sold Number of Lines Committed
-------------------- -------------------------
<S> <C>
11 - 21 11
22 - 101 22
102 - 251 101
252 - 1,001 251
over 1,001 1,001
</TABLE>
The Commitment Bonus for ICB Centrex will be awarded if, and only if,
the number of lines committed to by the customer equals at least eighty
percent (80%) of the number of lines sold to the customer.
7.8 Objective Retirement and Objective Attainment For Objective
Retirement purposes, the monthly contract values used for New
Centrex sales and additions to existing Centrex systems are as
follows:
35
<PAGE> 40
<TABLE>
<CAPTION>
Centrex Service CV Per Month
--------------- ------------
<S> <C>
ACS and Indiana Advanced Centrex $20
ISDN Centrex $30
ICB Centrex $16
</TABLE>
The following factors will be applied to the Base Upfront Commission
Payment for purposes of Objective Attainment:
<TABLE>
<CAPTION>
Objective Attainment Factor
-------------------- ------
<S> <C>
0-69.9% 1.00
70-99.9% 1.15
100% and over 1.30
</TABLE>
7.9 Residual Commission Payment Schedule
A Residual Commission Payment will be paid at a rate of
* , and will continue for so long
as the customer's contract is in effect. In no event will
Residual Payments be paid on a month-to-month Centrex sale.
7.10 Recasts, Renewals, Renegotiations of existing Centrex Contracts
a) The AD of Record or other Ameritech representative of
Record has the exclusive right to Renew, Recast or
Renegotiate the contract during the contract term through
sixty (60) days prior to the contract expiration date.
b) If the customer's contract term in effect at the time of
the Recast or Renewal is more than one hundred and eighty
(180) days from the date the contract expires, commission
will not be paid to AD for a Centrex Recast or Renewal,
unless Ameritech has provided prior written approval for
such a payment. Commission will not be paid on Centrex
Renegotiations unless Ameritech has provided written
approval for such payment prior to the date the contract
was signed by the customer.
c) After a customer contract has expired, and the customer is
under a month-to-month term for that Product, any sale of
that Product which is submitted by AD will be considered a
Recast or Renewal for purposes of commission. If the
customer contract expired six (6) or more months prior to
the AD's submission, and the customer has been on a
month-to-month subscription for that period, Ameritech will
pay commission at the New sale rate.
d) Commission for Centrex Recasts, Renewals and Renegotiations
will be paid as follows:
(i) The Base Commission will equal 75% of the amount paid
for an identical New sale.
(ii) The Residual Commission Payment will be paid at the
same rate as an identical New Centrex sale.
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<PAGE> 41
7.11 Month-to-Month centrex. For purposes of calculating the CV, a
month-to-month Centrex sale will be considered equal to nine (9)
months Recurring Revenue. In no event will Residual Payments be
paid on a month-to-month Centrex sale.
7.12 Takeback. The Upfront Commission Payment is subject to Takeback
in the event the customer discontinues a service (for any or no
reason) for which AD received commission in the past. The
Takeback amount will be based upon the length of time the
customer retained the service and whether the sale was under a
term contract:
a) If the sale is a term contract, and the service is
discontinued within the first fifty percent (50%) of the
contract term, the amount of Takeback will be prorated to
the length of time remaining on the customer's contract.
b) If the sale was a month-to-month subscription, and the
customer discontinues the service within sixty (60) days of
the Completed Order date, the Takeback amount will equal
one hundred percent (100%) of the commission paid. Residual
Commission Payments cease when a service is discontinued.
8.0 Ameritech FeatureLink.
Commission payment and conditions for payment for Ameritech
FeatureLink service are the same as those set forth above
for ACS Centrex, except that no Commitment Bonus is
available for the sale of Ameritech FeatureLink.
9.0 Other Voice Products
9.1 The commission payment schedule set forth below applies to New
sales of the following Products:
Caller ID
Custom Calling Services
Linebacker
Local Access Lines
PBX Trunks
Remote Call Forwarding
Voice Mail Service
<TABLE>
<CAPTION>
Objective Winback Bonus
Attainment Upfront (See Note) Residual
------------- ----------- ------------- -------------------------
<S> <C> <C> <C>
* * * *
</TABLE>
Note: The winback bonus applies only to the sale of Local Access Lines.
9.2 CV. The CV for the above Products will be determined by the
following formula:
(Nonrecurring Revenue) + (Recurring Revenue X 24 Months) = CV
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<PAGE> 42
9.3 Residual Commission Payments. Residual Commission Payments will be
paid for a period of twenty four (24) months, and in no event will AD be
eligible for Residual Commission Payment on the above Products after twenty four
(24) monthly commission payments have been made.
9.4 Conversion from Centrex Service. In no event will AD be paid
commission on a sale which converts the customer from Centrex service (of any
type) to Local Access Lines.
9.5 Takeback. If the AD received commission for a Product subject to
this Section 9.0, and the customer discontinues the Product for any reason
within one hundred and eighty (180) days after the Completed Order date,
takeback applies, and the amount of takeback equals one hundred percent (100%)
of the commission paid to AD.
10.0 Ameritech SmartFax Connections
10.1 Upfront Commission Payment. The following Upfront Commission
Payment schedule applies to New sales of, and "Sales of Additions" to, Ameritech
SmartFax Connections.
<TABLE>
<CAPTION>
Contract Description Commission Award
-------------------- ----------------
<S> <C>
No Contract (Month-to-Month)
One year Contract *
Contract Renewal
</TABLE>
10.2 CV. CV is determined by the following formula: (Nonrecurring
Revenue) + (Recurring Revenue x Contract Length) = CV
10.3 Residual Commission Payment. Residual Commission Payment will
equal * of the monthly Recurring Revenue and the monthly usage
revenue which appears on the customer's Ameritech local service bill.
10.4 Renewal Upfront Commission Payment. In the event AD submits a sale
which is deemed by Ameritech to be a Renewal for the Ameritech SmartFax
Product, and the Renewal is submitted within sixty (60) days from the expiration
date of the customer's then-in-effect contract for that service, the AD will
receive a Renewal Upfront commission Payment. If the AD converts a customer's
subscription to the service from a month-to-month to a term contract, the AD
will receive commission at the Renewal rate. After a customer's contract has
expired, and the customer is under a month-to-month term for at least six (5)
months following the expiration, any sale submitted by AD will be considered a
New sale for purposes of commission.
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<PAGE> 43
11.0 Ameritech 9-1-1 Locator ID
11.1 Commission Schedule. Commission for this Product will be awarded
according to the following schedule:
<TABLE>
<CAPTION>
Sale Description Commission Award
---------------- ----------------
<S> <C>
Non-Centrex
Software Only
Software and Hardware
Centrex *
Software Only
Software and Technical Support
</TABLE>
<TABLE>
<S> <C>
Record Loading $0.01 per record, not to exceed $250.00
-------------- ---------------------------------------
</TABLE>
11.2 CV. The CV is determined by the following formula: (Nonrecurring
Revenue) + (Recurring Revenue x Contract Length)=CV
11.3 Residual Commission Payment. No Residual Commission Payment will
be paid.
12.0 Eligible Standard Data Products
12.1 Common Provisions. The following applies to all Eligible Standard
Data Products.
a) Sales to Retail Business Customers Only. The conditions
and limitations set forth elsewhere in the Agreement apply to the sale of Data
Products. In addition, Ameritech will not pay commission on any network sale
which is configured as terminating only service, as that term is understood in
the telecommunications industry.
b) Eligible Standard Data Products. Eligible Standard Data
Products are specified under Exhibit B of the Agreement, and AD's right to
earn commission for sales of Data Products as set forth below are governed by
the terms, conditions and limitations of the Agreement and Exhibit B.
c) Recasts, Renewals, Renegotiations.
(i) If the customer's contract term-in-effect at the
time of the Recast or Renewal is more than one hundred and eighty
(180) days from the date the contract expires, commission will not be
paid to AD for a Data Product Recast or Renewal, unless Ameritech has
provided prior written approval for such a payment. Commission will
not be paid on Data Product Renegotiations unless AD has received from
Ameritech written approval for such payment prior to the date the
contract was signed by the customer.
39
<PAGE> 44
(ii) After a customer contract has expired, and the
customer is under a month-to-month term for that Product, any sale for
that Product which is submitted by AD will be considered a Recast or
Renewal for purposes of commission. If the customer contract expired
six (6) or more months prior to the AD's submission, and the customer
has been on a month to month subscription for that period Ameritech
will be pay commission at the New sale rate.
(iii) Commission for Data contract Recast, Renewals and
Renegotiations will be awarded as follows:
(a) The Base Commission will equal 50% of the amount
paid for an identical New sale (New sale commission payment
schedule set forth below)
(b) The Residual Payment will be paid at the same rate
as an identical New sale of the same Data Product
d) Month-to-Month Subscription. For purposes of commission
payment calculation, a month-to-month Data sale will be considered equal to
nine (9) months Recurring Revenue. In no event will Residual Payments be paid on
a month-to-month Data sale.
e) Takeback. If the AD received commission for a Product subject
to this Section 12.0, and the customer discontinues the Product for any reason,
Takeback applies. The amount of Takeback is based upon the length of time the
customer retained the service and if the sale was a term contract: a) if the
customer discontinues the Product during the first fifty percent (50%) of the
contract term, the Takeback amount will be prorated to the length of time
remaining on the customer's contract; b) if the customer discontinues a
month-to-month subscription of the Product within sixty (60) days of
installation, the Takeback will equal one-hundred percent (100%) of the Upfront
Commission Payment. Residual Commission Payments cease when a contract is
discontinued.
12.2 Basic Data Products
a) Commission Payment Schedule. The following commission
payment schedule applies to New sales and additions to existing, installed
services for the following Products:
Ameritech Base Rate (BR or DSO)
Ameritech DS1
Ameritech Fractional DS1 (384)
Ameritech DS3
Ameritech ISDN Prime
Ameritech Reconfiguration Service
Ameritech Digital Transport Service-Enhanced (ADTS-E)
40
<PAGE> 45
<TABLE>
<CAPTION>
Objective Winback
Attainment Upfront Bonus Residual
---------- ------- ------ --------
<S> <C> <C> <C>
* * * *
</TABLE>
b) CV. The CV for the above schedule is determined by the
following formula: (Nonrecurring Revenue) + (Recurring Revenue x Contract
Length) = CV
12.3 Ameritech Analog and Broadcast Video Services
a) Ameritech Analog and Broadcast Video. The following commission
payment schedule applies to New sales and Additions to existing installations of
Ameritech Analog and Broadcast Video services:
<TABLE>
<CAPTION>
Objective Winback
Attainment Upfront Bonus Residual
---------- ------- ------ --------
<S> <C> <C> <C>
* * * *
</TABLE>
b) CV. The CV for the above schedule is determined by the
following formula: (Nonrecurring Revenue) + (Recurring Revenue x Contract
Length) = CV
12.4 Complex Data Products
a) Commission Payment Schedule. The following commission payment
schedule applies to New sales and additions to existing installations of the
following Data products:
Ameritech Synchronized Optical Network Service (SONET)
Ameritech Frame Relay Service (FRS)
Ameritech Connectionless Broadband Data Service (CBDS)
Ameritech Internet Access (Dedicated Access over FRS or CBDS)
Ameritech Remote Office Access Manager (ROAM)
Ameritech LAN Interconnection Service (ALIS)
Ameritech Host Interconnection Service (AHIS)
Ameritech Fiber Distributed Data Interface Service (FDDI)
Ameritech Asynchronous Transfer Mode Service (ATM)
<TABLE>
<CAPTION>
Objective Winback
Attainment Upfront Bonus Residual
---------- ------- ------ --------
<S> <C> <C> <C>
* * * *
</TABLE>
41
<PAGE> 46
b) CV. The CV for the above schedule is determined by the
following formula: (Nonrecurring Revenue) + (Recurring Revenue x Contract
Length) = CV
12.5 Ameritech ISDN Direct Service
a) The following commission payment schedule applies to New sales
and additions to existing installations of Ameritech 1SDM Direct Service:
<TABLE>
<CAPTION>
Objective
Attainment Upfront Residual
---------- ------- --------
<S> <C> <C>
* * *
</TABLE>
b) CV. The CV for the above schedule is determined by the
following formula: (Nonrecurring Revenue) + (Recurring Revenue x Contract
Length) = CV
12.6 Ameritech Packet Switched Network Service
a) The following commission payment schedule applies to New sales
and additions to existing installations of Ameritech Packet Switched Network
Service. For purposes of the Agreement, Ameritech Packet Switched Network
Service includes x.25 direct line, and ISDN B Channel which serves an x.25
application computer.
<TABLE>
<CAPTION>
Objective
Attainment Upfront Residual
---------- ------- --------
<S> <C> <C>
* * *
</TABLE>
b) CV. The CV for the above schedule is determined by the
following formula: (Nonrecurring Revenue) + (Recurring Revenue x Contract
Length) = CV
13.0 ValueLink Products
13.1 For purposes of the Agreement, the Products referenced in this
Section 13.0 are collectively classified by Ameritech as the Ameritech ValueLink
product family. The conditions and limitations regarding the sale of Products
apply to the ValueLink product family, including, without limitation, that the
AD shall not sell the Products, and is not entitled to commission on sales to
customers who are not designated by Ameritech as retail business customers.
13.2 Month-to-month subscriptions. In no event will AD be awarded
commission for month-to-month ValueLink product sale.
42
<PAGE> 47
13.3 Enhanced ValueLink Plus. The commission payment schedule provided
below applies to New sales of Enhanced ValueLink Plus.
a) Commission Payment Schedule
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
12 Month Contract
Objective Attainment
---------------------------------------------------------------------------------
Minimum Annual Upfront Upfront Upfront
Revenue Commitment * Residual * *
------------------ ------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
* * * * *
------------------ ------------------ ------------------ ------------------ ------------------
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
24 Month Contract
Objective Attainment
---------------------------------------------------------------------------------
Minimum Annual Upfront Upfront Upfront
Revenue Commitment * Residual * *
------------------ ------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
* * * * *
------------------ ------------------ ------------------ ------------------ ------------------
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
36 Month Contract
Objective Attainment
---------------------------------------------------------------------------------
Minimum Annual Upfront Upfront Upfront
Revenue Commitment * Residual * *
------------------ ------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
* * * * *
------------------ ------------------ ------------------ ------------------ ------------------
</TABLE>
b) CV. The CV for the above schedule determined by the
following formula:
(MARC) x (Contract Length in Years) = CV
43
<PAGE> 48
13.4 ValueLink Extra. The commission payment schedule below applies to
New sales of ValueLink Extra.
a) Commission Payment Schedules Without Netting
<TABLE>
<CAPTION>
-------------------------------------------------------------------------
24 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------
Minimum Annual
Revenue Upfront Upfront Upfront
Commitment * Residual * *
---------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------
36 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------
Minimum Annual
Revenue Upfront Upfront Upfront
Commitment * Residual * *
---------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
44
<PAGE> 49
b) Commission Payment Schedule With Netting
<TABLE>
<CAPTION>
-------------------------------------------------------------------------
24 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------
Minimum Annual
Revenue Upfront Upfront Upfront
Commitment * Residual * *
---------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------
36 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------
Minimum Annual
Revenue Upfront Upfront Upfront
Commitment * Residual * *
---------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
c) CV. The CV for a contract without Netting determined by the
following formula:
(MARC) x (Contract Length in Years) = CV
The CV for a contract with Netting is determined by the
following formula:
(Net MARC) x (Contract Length in Years) = CV
13.5 ValueLink Extra - Local. The commission payment schedule below
applies to New sales of ValueLink Extra - Local.
45
<PAGE> 50
a) Commission Payment Schedule Without Netting
24 Month Contract - Without Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residua1 * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
36 Month Contract - Without Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residua1 * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
b) Commission Payment Schedule With Netting
24 Month Contract - With Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residua1 * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
46
<PAGE> 51
36 Month Contract - With Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residua1 * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
c) CV. The CV for a contract without Netting is
determined by the following formula: (MARC) x
(Contract Length in Years) = CV.
The CV for a contract with Netting is determined by
the following formula:
(Net MARC) X (Contract Length in Years) = CV
13.6 ValueLink Extra-Select. The commission award and payment
schedules provided below apply to New sales of Extra-Select.
a) Commission Payment Schedules Without Netting
12 Month Contract - Without Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront
Commitment * Residua1 * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
24 Month Contract - Without Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront
Commitment * Residua1 * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
47
<PAGE> 52
36 Month Contract - Without Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
b) Commission Payment Schedule With Netting
12 Month Contract - With Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
24 Month Contract - With Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
36 Month Contract - With Netting
Objective Attainment
<TABLE>
<CAPTION>
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
c) CV. The CV for a contract without Netting is
determined by the following formula: (MARC) x
(Contract Length in Years) = CV.
48
<PAGE> 53
The CV for a contract with Netting is determined by
the following formula (Net MARC) X (Contract Length
in Years) = CV
13.7 ValueLink Illinois Option F Preferred. The commission payment
schedules below applies to New sales of ValueLink Illinois
Option F Preferred.
a) Commission Payment Schedules
12 Month Contract
Objective Attainment
<TABLE>
<CAPTION>
Minimum Annual Upfront
Minutes of Use Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
24 Month Contract
Objective Attainment
<TABLE>
<CAPTION>
Minimum Annual Upfront
Minutes of Use Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
36 Month Contract
Objective Attainment
<TABLE>
<CAPTION>
Minimum Annual Upfront
Minutes of Use Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
b) CV. The CV for the above schedules is determined by
the following formula: (Minimum Annual MOU x Per
Minute Rate) x (Contract Length In Years)
49
<PAGE> 54
13.8 ValueLink Illinois Option F. The commission payment schedules
below applies to New Sales of ValueLink Illinois Option F.
a) Commission Payment Schedules
12 Month Contract
Objective Attainment
<TABLE>
<CAPTION>
Minimum Annual Upfront
Minutes of Use Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
24 Month Contract
Objective Attainment
<TABLE>
<CAPTION>
Minimum Annual Upfront
Minutes of Use Upfront Upfront
Commitment * Residual * *
-------------- -------- --------- --------- ----------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
50
<PAGE> 55
<TABLE>
<CAPTION>
36 Month Contract
Objective Attainment
-------------------------------------------
Minimum Annual
Upfront Minutes of Use Upfront Upfront
* Commitment * Residual *
---------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
* * * * *
---------- --------- ---------- ---------- ----------
</TABLE>
b) CV. The CV for the ABOVE schedules is determined by the
following formula: (Minimum Annual MOU x per Minute Rate) x
(Contract Length In Years) = CV
(The Balance of this Page Intentionally Left Blank)
<PAGE> 56
13.9 StraightRate Illinois. The commission payment schedule below
applies to New sales of StraightRate Illinois.
<PAGE> 57
a) Commission Payment Schedules
<TABLE>
<CAPTION>
12 Month Contract
Objective Attainment
-------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
* * * * *
-------------- --------- ---------- ---------- ---------
</TABLE>
<TABLE>
<CAPTION>
24 Month Contract
Objective Attainment
-------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
--------------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
* * * * *
--------------- -------- ---------- ---------- ----------
</TABLE>
<PAGE> 58
<TABLE>
<CAPTION>
36 Month Contract
Objective Attainment
-------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
* * * * *
-------------- --------- ---------- ---------- ----------
</TABLE>
b) CV. The CV for the ABOVE schedules is determined by the
following formula: (Minimum Annual MOU x per Minute Rate) x
(Contract Length In Years) = CV
<PAGE> 59
13.10 ValueLink Extra - HQ- Individual Case Basis (ICB) Usage. The
following commission payment schedule applies to New sales of
ValueLink Extra - HQ - Individual Case Basis (ICB) Usage contracts:
a) Upfront Commission Payment Schedule
<TABLE>
<CAPTION>
ValueLink Extra - HQ - ICB
Objective Attainment
-------------------------------------------
Contract
Length * * *
-------------- ---------- ---------- ----------
<S> <C> <C> <C>
* 24 Months * *
36 Months
</TABLE>
b) CV. The CV for the above schedules is determined by the
following formula: (MBRC) x (Contract Length in Months) = CV
c) Residual Commission Payment. No residual will be paid for
commissions will be paid for ValueLink Extra - HQ - ICB Usage
sales.
d) Contract term greater than 36 months. If ValueLink Extra - HQ -
ICB usage sale is for a contract with a term greater than thirty
six (36) months, the commission payment for such a sale will use
a commission Payment Schedule set forth above for thirty a six
(36) month ValueLink Extra - HQ - Usage sale.
13.11 Contract Upgrade or Migration
a) Commission Payment
<PAGE> 60
(i) When both the Product sold and the Ameritech product or
service which is being replace are both specified in Exhibit B as
"Products" for purposes of the Agreement, the Upfront Commission
Payment for a sale deemed by Ameritech as an Upgrade or a
Migration will be determined by the following formula:
(Current Base Upfront Commission for New Product) - (minus)
(Current Base Upfront Commission for Old Product) = Upfront
Commission Payment
(ii) When a sale for a Product is replacing an Ameritech product
or service which is not specified in Exhibit B as a "Product",
the Upfront Commission Payment for the sale (whether it is deemed
an Upgrade or a Migration) is determined by the formula:
(Current Base Upfront Commission for Product) x (50%) = Upfront
Commission Payment
<PAGE> 61
b) Does Not Retire Objective. Neither an Upgrade nor a
Migration will serve to retire the AD's Usage Product family
objective, and neither will an Upgrade nor a Migration is
subject to an Objective Bonus.
c) Residual Commission Payment. The Residual Commission Payment
for an Upgrade or a Migration will be calculated in the same
manner and at the same rate as a New sale of the Product. In
every case, the Residual Commission Payment, if any, for the
product or service which is being replaced as the result of
the Upgrade or Migration will be discontinued effective the
date of the Completed Order.
13.12 Takeback. If the AD received commission for a Product subject to
this Section 13.0, and the customer discontinues the Product for
any reason, Takeback applies. If the customer discontinues a
Product within one-hundred and eighty days after the Completed
Order date, the Takeback will equal one-hundred percent (100%) of
the Upfront Commission Payment. Residual commissions cease
effective the date the customer cancels the product.
14.0 1-800-CONFERENCE
14.1 Commission Payment Schedule. Sales of 1-800-CONFERENCE consist
only of an Upfront Commission Payment, and no Residual Payment
applies.
a) Non-ICB Term Contract Sale. The following commission payment
schedule applies to sales under which the customer signs a
term agreement which is not an ICB contract for
1-800-CONFERENCE service:
<PAGE> 62
<TABLE>
<CAPTION>
Minimum
Annual Revenue
Commitment 1 Year Contract 2 Year Contract 3 Year Contract
--------------- ---------------- --------------- ---------------
<S> <C> <C> <C>
* * * *
</TABLE>
b) CV. The CV is determined by the following formula:
(Annual Revenue Commitment) x (Contract Length In Years = CV
c) ICB Term Contract Sale. The commission to be paid is for an
ICB term contract sale for 1-800- CONFERENCE service will be
arrived at through the following formula:
(CV) x (Ten-Percent (10%)) = Commission Payment
<PAGE> 63
14.2 Objective Attainment. For purposes of Objective
Attainment, the following factors will be applied to the
Base Payment to arrive at the Objective Attainment
number:
<TABLE>
<CAPTION>
Objective Attainment Factor
-------------------- ------
<S> <C>
* *
</TABLE>
15.0 Ameritech Prepaid Products
15.1 Commission Payment. The AD of Record will be paid
commission for PrePaid Product sales. If the customer
places orders for additional Product, the AD of Record
will be paid for those additional sales whether the
customer places the order with the AD or with
Ameritech's PrePaid product support organization.
15.2 Commission Value. The Base Commission value and the
Upfront Commission Payment for a sale will equal
* of the gross value of the sale, net of
taxes whether it is the original sale or a subsequent
sale as provided for under Section 15.1 above. No
Residual Commission Payment applies to Prepaid Products.
15.3 Objective Attainment. For purposes of objective
attainment, the following factors will be applied to the
Base Commission.
<TABLE>
<CAPTION>
Objective Attainment Factor
-------------------- ------
<S> <C> <C>
* *
</TABLE>
(The Balance of this Page Intentionally Left Blank}
55
<PAGE> 64
Exhibit D
COOP & 5-STAR PROGRAM
Exhibit D CO-OP AND 5-STAR PROGRAM
This is Exhibit D to the Authorized Distributor Agreement between
Telecomm Industries, Inc. ("AD") and Ameritech, effective January 1, 1999, and
this Exhibit is incorporated into the Agreement by reference.
Ameritech provides incentive programs as an integral part of the
Agreement. The "Co-Op Program" and the "5-Star Program" is governed by the rules
and regulations which are fully set forth in a document titled "Ameritech
Authorized Distributor Co-Op and 5-Star Program", and said document is dated
"January 1999, and said document is incorporated herein as if originally set
forth here as Exhibit D. The Co-op and 5-Star Program may be modified during the
term of the Agreement, and such modification is governed by the terms of the
Agreement, and each modification is incorporated by reference herein on the date
the modification is effective.
(The Balance of this Page Intentionally Left Blank)
56
<PAGE> 65
Exhibit E
Code of Business Conduct
Exhibit E CODE OF BUSINESS CONDUCT
This is Exhibit E to the Authorized Distributor Agreement between
Telecomm Industries, Inc. ("AD") and Ameritech effective January 1, 1999, and
this Exhibit is incorporated into the Agreement by reference.
1. Every Authorized Distributor has the professional responsibility of fair
dealing towards Ameritech's customers, past and present, fellow Authorized
Distributors, and the general public.
2. Every Authorized Distributor has the professional responsibility of adhering
to generally accepted standards of accuracy and truth.
3. An Authorized Distributor shall not place itself in a position where the
Authorized Distributors interest is, or may be, in conflict with its duty to the
customer or Ameritech.
4. Each Authorized Distributor shall safeguard the confidence of both present
and former customers/clients, and shall not disclose or use these confidences to
disadvantage or prejudice such clients.
5. An Authorized Distributor shall not intentionally disseminate false or
misleading information, and each Authorized Distributor is obligated to use
appropriate means to avoid dissemination of false or misleading information.
6. An Authorized Distributor shall not disparage the professional reputation or
practice of another Authorized Distributor.
7. Each Authorized Distributor's employees shall be treated as individuals with
respect to their dignity and recognition of their merit.
(The Balance of this Page Intentionally Left Blank)
57
<PAGE> 66
Exhibit F
House Accounts
Exhibit F HOUSE ACCOUNTS
This is Exhibit F to the Authorized Distributor Agreement between
Telecomm Industries, Inc. ("AD") and Ameritech effective January 1, 1999, and
this Exhibit is incorporated by reference therein.
<PAGE> 67
House Accounts
Pursuant to Article 1, Section 1.7. the customer accounts which
Ameritech designates, in its sole discretion, as "House Accounts" are listed on
the web site # and said list is incorporated by reference as if set
forth fully herein, as modified from time-to-time by Ameritech, and each such
modification is deemed incorporated as if set forth originally herein.
(The Balance of this Page Intentionally Left Blank)
<PAGE> 68
April 1, 1999
Dear Authorized Distributor:
RE: Notice of Modifications to Exhibit C COMMISSION of the Authorized
Distributor Agreement effective January 1, 1999.
This is Notice pursuant to ARTICLE 15 NOTICE of the above referenced Agreement
("Agreement") of the following Modifications. The modifications are in effect
thirty (30) calendar days after the date of this letter.
This Notice is being sent to you as required under ARTICLE 15 of said Agreement.
ADDITIONS TO THE CONTRACT ARE REFLECTED WITH UNDERSCORE AND DELETIONS BY
STRIKETHROUGH. (NOTE: Due to the limitations of the EDGAR system, underscores
will be preceded by "<<" and followed by ">>". Strikethroughs will be preceded
by "[[" and followed by "]]".)
John Maloney
Regional Channel Manager
April 1, 1999 Ameritech Authorized Distributor Agreement Modifications
AMERITECH CONFIDENTIAL
<PAGE> 69
<<CENTREX COMMISSIONS FOR INDIANA AND OHIO>>
The Centrex commission information contained in the 1999 AD Agreement is amended
effective January 1, 1999 for Indiana and Ohio only. The modifications are
indicated below.
AMEND SECTION 7.3 TO READ:
7.3 <<New Centrex Sales>>
Commission on New Centrex system sales will be paid provided
the sale results in a net increase in Centrex station lines of
at least fifteen percent (15%) of the existing installed
system. In Indiana, the Centrex station line net increase must
be at least <<seventy-five percent (75%)>> of the existing
installed system.
AMEND SECTION 7.4 TO READ:
7.4 <<Upfront Commission Payment Schedule>>
The Upfront Commission Payment schedule set forth below
applies to New Centrex system sales. The Commission Payments
are stated in terms of one Centrex station line; the actual
Commission Payment for a particular sale will be based on the
number of lines sold, and, the Commission Payment amount will
be calculated by multiplying the rate set forth below for a
single Centrex station line by the total number or station
lines sold.
April 1, 1999 Ameritech Authorized Distributor Agreement Modifications 2
AMERITECH CONFIDENTIAL
<PAGE> 70
<TABLE>
<CAPTION>
ACS and Indiana Advanced Centrex
---------------------------------------------------------------------------------------
Month-to-Month 36 Months 60 Months 84 Months
-------------- --------- --------- ---------
<S> <C> <C> <C> <C>
Illinois
<<Indiana>>
Michigan * * * *
<<Ohio>>
Wisconsin
</TABLE>
<TABLE>
<CAPTION>
ISDN Centrex
---------------------------------------------------------------------------------------
Month-to-Month 36 Months 60 Months 84 Months
-------------- --------- --------- ---------
<S> <C> <C> <C> <C>
Illinois
<<Indiana>>
Michigan * * * *
<<Ohio>>
Wisconsin
</TABLE>
<TABLE>
<CAPTION>
ICB Centrex
---------------------------------------------------------------------------------------
Month-to-Month 36 Months 60 Months 84 Months
-------------- --------- --------- ---------
<S> <C> <C> <C> <C>
Illinois
<<Indiana>>
Michigan * * * *
<<Ohio>>
Wisconsin
--- --- --- ---
</TABLE>
Note: ICB Centrex sales for contract lengths greater than 84
months will be awarded commission based on the 84 month
commission award.
AMEND SECTION 7.9 TO READ:
7.9 <<Residual Commission Payment Schedule>>
A Residual Commission Payment will be paid at a rate of
* per line, per month, and will continue for so
long as the customer's contract is in effect <<for Illinois,
Michigan and Wisconsin. A Residual Commission Payment will be
paid at a rate of * per line,
per month, and will continue for so long as the customer's
contract is in effect for Indiana and Ohio.>> In no event will
Residual Payments be paid on a month-to-month Centrex sale.
<<COMPLEX DATA PRODUCTS>>
AMEND ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES TO INCLUDE:
<<Ameritech AutoVAN (ANX) Service>>
AMEND ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES OBJECTIVE RETIREMENT TO
INCLUDE:
April 1, 1999 Ameritech Authorized Distributor Agreement Modifications 3
AMERITECH CONFIDENTIAL
<PAGE> 71
ELIGIBLE PRODUCTS AND SERVICES OBJECTIVE RETIREMENT
------------------------------ --------------------
<<Ameritech AutoVAN (ANX) Service>> <<Yes>>
AMEND SECTION 12.4 TO INCLUDE:
c) <<Ameritech AutoVAN (ANX)>> Service. Commission payment for
Ameritech AutoVAN sales will equal * of CV.
Residuals will not be paid on AutoVAN sales. Payment of
commission on sales of AutoVAN is subject to a number of
conditions and requirements, all of which are specifically set
forth in the Ameritech AutoVAN sales kit found in the
Ameritech resource library at the * or
successor website, as may be modified from time-to-time by
Ameritech.
<<VALUELINK EXTRA - SELECT>>
AMEND SECTION 13.6 TO READ:
13.6 <<ValueLink Extra-Select.>> The commission award and payment
schedules provided below apply to New sales of ValueLink
Extra-Select <<with one exception. The schedules for New sales
of * MARC ValueLink Extra-Select apply if and only if the
New sale also includes the New sale of at least one of the
following products: (i) one or more Local Access Lines or PBX
Trunks, (ii) one or more Centrex Lines and/or (iii) one or
more ISDN Direct Lines.>>
<<When the New sale of the * MARC ValueLink Extra-Select
does not include the New sale of at least one of the above
referenced products, the upfront and residual commission
payments and the Objective Revenue dollar amount will be
reduced by * >>
April 1, 1999 Ameritech Authorized Distributor Agreement Modifications 4
AMERITECH CONFIDENTIAL
<PAGE> 72
June 3, 1999
Dear Authorized Distributor:
RE: Notice of Modifications to Exhibit C COMMISSION of the Authorized
Distributor Agreement effective January 1, 1999, as last amended April 1, 1999.
This is Notice pursuant to ARTICLE 15 NOTICE of the above referenced Agreement
("Agreement") of the following Modifications. The modifications are in effect
thirty (30) calendar days after the date of this letter.
This Notice is being sent to you as required under ARTICLE 15 of said Agreement.
ADDITIONS TO THE CONTRACT ARE REFLECTED WITH <<UNDERSCORE>> AND DELETIONS BY
[[STRIKETHROUGH.]]
John Maloney
Regional Channel Manager
<PAGE> 73
SECTION 13.0 IS AMENDED WITH THE CHANGES WHICH ARE INDICATED BELOW. HOWEVER, FOR
YOUR CONVENIENCE SECTION 13.0 IN ITS ENTIRETY IS RESTATED BELOW, WITH THE
ADDITIONS INDICATED BY "UNDERLINE" AND DELETIONS INDICATED BY [[STRIKETHROUGH.]]
13.0 <<COMPLETELINK AND>> VALUELINK PRODUCTS
13.1 For purposes of the Agreement, the Products referenced in this
Section 13.0 are collectively classified by Ameritech as the
Ameritech <<CompleteLink and>> ValueLink product famil<<ies>>.
The conditions and limitations regarding the sale of Products
apply to the <<CompleteLink and>> ValueLink product
famil<<ies>>, including, without limitation, that the AD shall
not sell the Products, and is not entitled to commission on
sales to customers who are not designated by Ameritech as
retail business customers.
13.2 <<Month-to-month subscriptions.>> In no event will AD be
awarded commission for month-to-month <<CompleteLink or>>
ValueLink product sales.
13.3 <<Enhanced ValueLink Plus>>. The commission payment schedule
provided below applies to New sales of Enhanced ValueLink
Plus.
a) Commission Payment Schedule
<TABLE>
<CAPTION>
12 Month Contract
Objective Attainment
---------------------------------------------------------------------------------------
Minimum Annual Upfront Upfront Upfront
Revenue Commitment * Residual * *
------------------ --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
24 Month Contract
Objective Attainment
---------------------------------------------------------------------------------------
Minimum Annual Upfront Upfront Upfront
Revenue Commitment * Residual * *
------------------ --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 74
<TABLE>
<CAPTION>
36 Month Contract
Objective Attainment
---------------------------------------------------------------------------------------
Minimum Annual Upfront Upfront Upfront
Revenue Commitment * Residual * *
------------------ --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
b) <<CV.>> The CV for the above schedule is determined by the
following formula:
(MARC) x (Contract Length in Years) = CV
[[13.4 <<ValueLink Extra>>. The commission payment schedule below applies
to New sales of ValueLink Extra.]]
[[a) <<Commission Payment Schedules Without Netting>>]]
<TABLE>
<CAPTION>
[[24 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[36 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 75
[[b) Commission Payment Schedule With Netting]]
<TABLE>
<CAPTION>
[[24 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[36 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
[[c) <<CV>>. The CV for a contract without Netting is
determined by the following formula: (MARC) x
(Contract Length in Years) = CV]]
[[The CV for a contract with Netting is determined by
the following formula:
(Net MARC) x (Contract Length in Years) = CV]]
<<13.4.1 CompleteLink. The commission award and payment schedules
provided below apply to orders solicited by AD for New sales
of CompleteLink only under the conditions which follow. The
commission schedules below apply to a New CompleteLink
contract with a MARC of $700 or $1,200 (when such MARCs are
properly indicated on the customer contract) if and only if
the New sale also includes the New sale of at least one of the
following products: (i) one or more Local Access Lines or PBX
Trunks, (ii) one or more Centrex Lines and/or (iii) one or
more ISDN Direct Lines.>>
<PAGE> 76
<<When the New sale of the CompleteLink with a MARC of $700 or
$1,200 does not include the New sale of at least one of the
above referenced products, the Base and Residual commission
Payments, and the Objective Revenue amount will be reduced by
fifty percent (50%).>>
<<a) Commission Payment Schedules for the Minimum Annual
Revenue Commitment (MARC)>>
<TABLE>
<CAPTION>
<<12 Month Contract
Objective Attainment
----------------------------------------------------------------------------------
Upfront Upfront Upfront
MARC * Residual * *
-------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
<<36 Month Contract
Objective Attainment
----------------------------------------------------------------------------------
Upfront Upfront Upfront
MARC * Residual * *
-------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 77
<TABLE>
<CAPTION>
<<60 Month Contract
Objective Attainment
----------------------------------------------------------------------------------
Upfront Upfront Upfront
MARC * Residual * *
-------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<<b) Commission Payment Schedules for the Minimum Annual
Toll Usage Commitment (MATUC)>>
<TABLE>
<CAPTION>
<<12 Month Contract
Objective Attainment
----------------------------------------------------------------
Upfront Upfront Upfront
MATUC * * *
------- --------- ---------- -------------
<S> <C> <C> <C>
* * * *
</TABLE>
<PAGE> 78
<TABLE>
<CAPTION>
<<36 Month Contract
Objective Attainment
----------------------------------------------------------------
Upfront Upfront Upfront
MATUC * * *
------- --------- ---------- -------------
<S> <C> <C> <C>
* * * *
</TABLE>
<TABLE>
<CAPTION>
<<60 Month Contract
Objective Attainment
----------------------------------------------------------------
Upfront Upfront Upfront
MATUC * * *
------- --------- ---------- -------------
<S> <C> <C> <C>
* * * *
</TABLE>
[[13.5 ValueLink Extra - Local. The commission payment schedule below
applies to New sales of ValueLink Extra - Local.]]
<PAGE> 79
[[a) Commission Payment Schedule Without Netting]]
<TABLE>
<CAPTION>
[[24 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[36 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
[[b) <<Commission Payment Schedule With Netting>>]]
<TABLE>
<CAPTION>
[[24 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 80
<TABLE>
<CAPTION>
[[36 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
[[c) <<CV>>. The CV for a contract without Netting is determined by
the following formula: (MARC) x (Contract Length in Years) =
CV.
The CV for a contract with Netting is determined by the
following formula: (Net MARC) x (Contract Length in Years) =
CV]]
[[13.6 ValueLink Extra-Select. The commission award and payment schedules
provided below apply to orders solicited by AD for New sales of
ValueLink Extra-Select only under the conditions which follow. The
commission schedule below applies to a New ValueLink Extra-Select
contract with a MARC of $700.00 (when such MARC is properly
indicated on the customer contract) if and only if the New sale also
includes the New sale of at least one of the following products: (i)
one or more Local Access Lines or PBX Trunks, (ii) one or more
Centrex Lines and/or (iii) one or more ISDN Direct Lines.
When the New sale of the ValueLink Extra-Select with a MARC of
$700.00 does not include the New sale of at least one of the above
referenced products, the Base and Residual Commission Payments, and
the Objective Revenue amount will be reduced by fifty percent (50%).
a) <<Commission Payment Schedules Without Netting>>]]
<TABLE>
<CAPTION>
[[12 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 81
<TABLE>
<CAPTION>
[[24 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[36 Month Contract - Without Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
[[b) <<Commission Payment Schedule With Netting>>]]
<TABLE>
<CAPTION>
[[12 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Upfront
Annual Revenue Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[24 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 82
<TABLE>
<CAPTION>
[[36 Month Contract - With Netting
Objective Attainment
-------------------------------------------------------------------------------------
Minimum
Annual Revenue Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
[[c) <<CV>>. The CV for a contract without Netting is determined by
the following formula: (MARC) x (Contract Length in Years) =
CV.
The CV for a contract with Netting is determined by the
following formula (Net MARC) x (Contract Length in Years) =
CV]]
13.7 <<ValueLink Illinois Option F Preferred>>. The commission payment
schedules below applies to New sales of ValueLink Illinois Option F
Preferred.
a) <<Commission Payment Schedules>>
<TABLE>
<CAPTION>
12 Month Contract
Objective Attainment
--------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
24 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
36 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
12,000 $54 $36 $68 $81
</TABLE>
<PAGE> 83
b) <<CV>>. The CV for the above schedules is determined by the
following formula: (Minimum Annual MOU x Per Minute Rate) x
(Contract Length In Years)
13.8 <<ValueLink Illinois Option F>>. The commission payment schedules
below applies to New sales of ValueLink Illinois Option F.
a) <<Commission Payment Schedules>>
<TABLE>
<CAPTION>
12 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
24 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 84
<TABLE>
<CAPTION>
36 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
b) <<CV.>> The CV for the above schedules is determined by the
following formula: (Minimum Annual MOU x Per Minute Rate) x
(Contract Length In Years) = CV
[[13.9 <<StraightRate Illinois.>> The commission payment schedule below
applies to New sales of StraightRate Illinois.]]
[[a) <<Commission Payment Schedules>>]]
<TABLE>
<CAPTION>
[[12 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[24 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<PAGE> 85
<TABLE>
<CAPTION>
[[36 Month Contract
Objective Attainment
-------------------------------------------------------------------------------------
Minimum Annual
Minutes of Use Upfront Upfront Upfront
Commitment * Residual * *
-------------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
[[b) <<CV>>. The CV for the above schedules is determined by the
following formula:
(Minimum Annual MOU x Per Minute Rate) x (Contract Length In
Years) = CV]]
13.10 <<CompleteLink>> [[ValueLink Extra]] <<- HQ - Individual Case Basis
(ICB) Usage>>. The following commission payment schedule applies to
New sales of <<CompleteLink>> [[ValueLink Extra]] - HQ - Individual
Case Basis (ICB) Usage contracts:
a) <<Upfront Commission Payment Schedule>>
<TABLE>
<CAPTION>
<<CompleteLink>> [[ValueLink Extra]] - HQ - ICB
Objective Attainment
-------------------------------------------------------------------------------
Contract
Length * * *
-------- ----------- ----------- -------------
<S> <C> <C> <C>
24 Months
36 Months * * *
<<60 Months
</TABLE>
b) <<CV>>. The CV for the above schedule is determined by the
following formula: (MBRC) x (Contract Length In Months) = CV
c) <<Residual Commission Payment>>. No residual commissions will
be paid for <<CompleteLink>> [[ValueLink Extra]] - HQ - ICB
Usage sales.
d) <<Contract terms different than presented above>> [[greater
than 36 months]]. If a <<CompleteLink>> [[ValueLink Extra]] -
HQ - ICB Usage sale is for a contract with a term <<different
than presented in the above table,>> [[greater than thirty six
(36) months]], the commission payment for such a sale will use
the Commission Payment Schedule set forth above for <<the next
lowest contract length>> [[a thirty six (36) month ValueLink
Extra - HQ - ICB Usage sale.]]
<PAGE> 86
13.11 CONTRACT UPGRADE OR MIGRATION
a) <<Commission Payment>>
(i) <<The Upfront Commission Payment for a CompleteLink
Upgrade or Migration sale will consist only of the
commission payment appropriate for the MATUC component
of the Upgrade or Migration sale. Commission will not
be paid for any other Upgrade or Migration sales>>.
[[When both the Product sold and the Ameritech product
or service which is being replaced are both specified
in Exhibit B as "Products" for purposes of the
Agreement, the Upfront Commission Payment for a sale
deemed by Ameritech as an Upgrade or a Migration will
be determined by the following formula: (Current Base
Upfront Commission for New Product) - (minus) (Current
Base Upfront Commission for Old Product) = Upfront
Commission Payment]]
(ii) [[When a sale for a Product is replacing an Ameritech
product or service which is not specified in Exhibit B
as a "Product", the Upfront Commission Payment for the
sale (whether it is deemed an Upgrade or a Migration)
is determined by the following formula:]]
[[(CURRENT BASE UPFRONT COMMISSION FOR NEW PRODUCT) X (50%) = UPFRONT COMMISSION
PAYMENT]]
b) <<Does Not Retire Objective>>. Neither an Upgrade nor a
Migration will serve to retire the AD's Usage Product family
objective, and neither an Upgrade nor a Migration is subject to
an Objective Bonus.
c) <<Residual Commission Payment. No residual commissions will be
paid for Upgrade or Migration sales. Additionally, any residual
commissions being paid for the former product will cease.>>
[[Residual Commission Payment for an Upgrade or a Migration
will be calculated in the same manner and at the same rate as a
New sale of the Product. In every case, the Residual Commission
Payment, if any, for the product or service which is being
replaced as the result of the Upgrade or Migration will be
discontinued effective the date of the Completed Order.]]
13.12 <<Takeback>>. If the AD received commission for a Product subject to
this Section 13.0, and the customer discontinues the Product for any
reason, Takeback applies. If the customer discontinues a Product
within one-hundred and eighty days after the Completed Order date,
the Takeback will equal one-hundred percent (100%) of the Upfront
Commission Payment. Residual commissions cease effective the date
the customer cancels the product.
<PAGE> 87
THE FOLLOWING IS A CHANGE TO EXHIBIT C, SECTION 12.6:
12.6 <<Ameritech AutoVan (ANX) Service>>
a) Ameritech AutoVAN (ANX) Service. Commission payment for Ameritech
AutoVAN sales will equal * of CV. Objective Bonus
and Residual Payment will not be paid on AutoVAN orders. AD's
authority to solicit orders for ANX, and AD's right to commission on
orders for AutoVAN are subject to a number of conditions and
requirements, all of which are specifically set forth in the
Ameritech AutoVAN sales kit which will be provided upon completion
of mandatory training. The AD guidelines for teaming with Ameritech
on ANX sales are posted in the AD Sales Library and are referred to
as AD ANX 6-Point Checklist.
<PAGE> 88
July 15, 1999
Dear Authorized Distributor
Re: <<Notice of Contract Change - Modifications to Exhibit C, COMMISSION,
-------------------------------------------------------------------
Authorized Distributor Agreement effective
-------------------------------------------
January 1, 1999, as last amended June 3, 1999>>
---------------------------------------------
This Notice is sent pursuant to Article 15 of the above-referenced Agreement.
The contract change(s), modification(s) or addition(s) are effective thirty (30)
calendar days after the date of this letter. ADDITIONS TO THE CONTRACT ARE
REFLECTED WITH <<UNDERSCORE>> AND DELETIONS BY [[STRIKETHROUGH]]. WHERE AN ITEM
IS UNDERLINED AND HAS A STRIKETHROUGH, THE STRIKETHROUGH TAKES PRECEDENCE.
(NOTE: Due to the limitations of the EDGAR system, underscores will be preceded
by "<<" and followed by ">>". Strikethroughs will be preceded by "[[" and
followed by "]]".)
John Maloney
Channel Manager
Page 1 of 10
Ameritech Confidential
<PAGE> 89
THE FOLLOWING ARE CHANGES TO THE AMERITECH AUTHORIZED DISTRIBUTOR AGREEMENT AS
LAST UPDATED JUNE 3, 1999.
AMEND SECTION "13.1 COMPLETELINK AND VALUELINK PRODUCTS" TO READ:
13.0 COMPLETELINK AND VALUELINK PRODUCTS
13.1 For purposes of the Agreement, the Products referenced in this Section
13.0 are collectively classified by Ameritech as the <<tariffed>>
Ameritech CompleteLink and ValueLink product families. The conditions
and limitations regarding the sale of Products apply to
the <<tariffed>> CompleteLink and ValueLink product families,
including, without limitation, that the AD shall not sell the
Products, and is not entitled to commission on sales to customers who
are not designated by Ameritech as retail business customers.
AMEND SECTION "13.4.1a) COMMISSION PAYMENT SCHEDULES FOR THE MINIMUM ANNUAL
REVENUE COMMITMENT (MARC)" TO READ:
<<a)>> Commission Payment Schedules for the Minimum Annual Revenue
Commitment (MARC)
[THE BALANCE OF THIS PAGE LEFT INTENTIONALLY BLANK]
Page 2 of 10
Ameritech Confidential
<PAGE> 90
<TABLE>
<CAPTION>
<<12 Month Contract
Objective Attainment
----------------------------------------------------------------
Upfront
Upfront Upfront
MARC * Residual * *
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[12 Month Contract
Objective Attainment
--------------------------------------------------------------------
Upfront
Upfront Upfront
MARC * Residual * *
-------- --------- -------- ---------- --------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
Page 3 of 10
Ameritech Confidential
<PAGE> 91
<TABLE>
<CAPTION>
<<36 Month Contract
Objective Attainment
--------------------------------------------------------------------
Upfront
Upfront Upfront
MARC * Residual * *
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[36 Month Contract
Objective Attainment
--------------------------------------------------------------------
Upfront
Upfront Upfront
MARC * Residual * *
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
Page 4 of 10
Ameritech Confidential
<PAGE> 92
<TABLE>
<CAPTION>
<<60 Month Contract
Objective Attainment
--------------------------------------------------------------------
Upfront
Upfront Upfront
MARC * Residual * *
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
[[60 Month Contract
Objective Attainment
--------------------------------------------------------------------
Upfront
Upfront Upfront
MARC * Residual * *
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
* * * * *
-------- -------- -------- -------- --------
</TABLE>
Page 5 of 10
Ameritech Confidential
<PAGE> 93
AMEND SECTION "13.4.1b) COMMISSION PAYMENT SCHEDULES FOR THE MINIMUM ANNUAL
TOLL USAGE COMMITMENT (MATUC)" TO READ:
<<b) Commission Payment Schedules for the Minimum Annual Toll Usage
Commitment (MATUC)>>
<TABLE>
<CAPTION>
<<12 Month Contract
Objective Attainment
-------------------------------------------------
Upfront
Upfront Upfront
MATUC * * *
<S> <C> <C> <C>
* * * *
</TABLE>
<TABLE>
<CAPTION>
[[12 Month Contract
Objective Attainment
-------------------------------------------------
Upfront
Upfront Upfront
MATUC * * *
------- ------- ------- -------
<S> <C> <C> <C>
* * * *
------- ------- ------- -------
</TABLE>
Page 6 of 10
Ameritech Confidential
<PAGE> 94
<TABLE>
<CAPTION>
<<36 Month Contract
Objective Attainment
--------------------------------------------------
Upfront
Upfront Upfront
MATUC * * *
------- ------- ------- -------
<S> <C> <C> <C>
* * * *
</TABLE>
<TABLE>
<CAPTION>
[[36 Month Contract
Objective Attainment
--------------------------------------------------
Upfront
Upfront Upfront
MATUC * * *
------- ------- ------- --------
<S> <C> <C> <C>
* * * *
------- ------- ------- -------
</TABLE>
Page 7 of 10
Ameritech Confidential
<PAGE> 95
<TABLE>
<CAPTION>
<<60 Month Contract
Objective Attainment
--------------------------------------------------
Upfront
Upfront Upfront
MATUC * * *
------- ------- ------- --------
<S> <C> <C> <C>
* * * *
</TABLE>
<TABLE>
<CAPTION>
[[60 Month Contract
Objective Attainment
--------------------------------------------------
Upfront
Upfront Upfront
MATUC * * *
------- ------- ------- -------
<S> <C> <C> <C>
* * * *
------- ------- ------- -------
</TABLE>
Page 8 of 10
Ameritech Confidential
<PAGE> 96
AMEND SECTION "13.11a) (i) CONTRACT UPGRADE OR MIGRATION" TO READ:
13.11 CONTRACT UPGRADE OR MIGRATION
a) <<Commission Payment>>
(i) <<Only upgrades or Migrations from Enhanced ValueLink
Plus to CompleteLink will be paid as New. Customers
with both Enhanced ValueLink Plus and ValueLink Extra
are not eligible. Upfront Commission will not be paid
for any other Upgrade or Migration sales.>>
[[The Upfront Commission Payment for a CompleteLink
Upgrade or Migration sale will consist only of the
commission payment appropriate for the MATUC component
of the Upgrade or Migration sale. Commission will not
be paid for any other Upgrade or Migration sales.]]
ADD A NEW SECTION "13.13 RENEWALS OF EXISTING USAGE CONTRACTS" THAT READS:
<<13.13 Renewals of existing Usage Contracts>>
a) <<If the customer's contract term in effect at the time of the
Renewal is more than ninety (90) days from the date the contract
expires, commission will not be paid to AD for a usage contract
Renewal, unless Ameritech has provided prior written approval for
such payment. Contract term is determined by the original
customer signature date.>>
<< b) After a customer contract has expired, any sale of that Product
which is submitted by AD will be considered a Renewal for
purposes of commission. If the customer contract expired six (6)
or more months prior to the AD's submission, and the customer has
been without a usage contract for that period, Ameritech will pay
commission at the New sale rate.>>
c) <<Commission for CompleteLink Renewals will be paid as follows:>>
(i) <<The Base Commission will equal 75% of the amount paid for an
identical New CompleteLink sale.>>
(ii) <<The Residual Commission Payment will be paid at the same
rate as an identical New CompleteLink sale.>>
<<d) Objective Retirement. Renewals will not retire the AD's Usage
Product family objective, nor will renewals be subject to an
Objective Bonus.>>
Page 9 of 10
Ameritech Confidential
<PAGE> 97
ADD A NEW SECTION, "13.14 MULTI-STATE COMPLETELINK CONTRACTS" THAT READS:
<< 13.14 Multi-state CompeteLink Contracts.>>
<< a) Multi-state contracts will retire objective based upon the Main
BTN.>>
Page 10 of 10
Ameritech Confidential
<PAGE> 98
September 1, 1999
Dear Authorized Distributor
Re: <<Notice of Contract Change - Modifications to Exhibit C, COMMISSION,
Authorized Distributor Agreement effective January 1, 1999, as last
amended July 15, 1999>>
This Notice is sent pursuant to Article 15 of the above-referenced Agreement.
The contract change(s), modification(s) or addition(s) are effective thirty (30)
calendar days after the date of this letter. ADDITIONS TO THE CONTRACT ARE
REFLECTED WITH <<UNDERSCORE>> AND DELETIONS BY [[STRIKETHROUGH]]. WHERE AN ITEM
IS UNDERLINED AND HAS A STRIKETHROUGH, THE STRIKETHROUGH TAKES PRECEDENCE.
(NOTE: Due to the limitations of the EDGAR system, underscores will be preceded
by "<<" and followed by ">>". Strikethroughs will be preceded by "[[" and
followed by "]]".)
John Maloney
Channel Manager
September 1, 1999 Ameritech Authorized Distributor Agreement Modifications
Ameritech Confidential 1
<PAGE> 99
<<UNDER 7.0 CENTREX PRODUCT FAMILY>>, AMEND SECTION 7.4 TO READ:
<<7.4 Upfront Commission Payment Schedule>>
<<The Upfront Commission Payment schedule set forth below applies to
New Centrex system sales. The Commission Payments are stated in terms
of one Centrex station line; the actual Commission Payment for a
particular sale will be based on the number of lines sold, and, the
Commission Payment amount will be calculated by multiplying the rate
set forth below for a single Centrex station line by the total number
or station lines sold.>>
<TABLE>
<CAPTION>
<<ACS and Indiana Advanced Centrex>>
--------------------------------
<<Month-to->>
<<Month>> <<36 Months>> <<60 Months>> <<84 Months>>
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
<<Illinois>>
<<Indiana>>
<<Michigan>> * * * *
<<Ohio>>
<<Wisconsin>>
</TABLE>
<TABLE>
<CAPTION>
<<ISDN Centrex>>
------------
<<Month-to->>
<<Month>> <<36 Months>> <<60 Months>> <<84 Months>>
------------------- ------------------ ------------------ -------------------
<S> <C> <C> <C> <C>
<<Illinois>>
<<Indiana>>
<<Michigan>> * * * *
<<Ohio>>
<<Wisconsin>>
</TABLE>
ADD A SECTION 7.4.1 AVN CENTREX THAT READS:
<<7.4.1 AVN Centrex Feature>>
<<AVN Centrex feature is paid at a * upfront commission
payment. No residuals apply to AVN Centrex feature sales. ADs shall
not receive commission on AVN Centrex feature renewals.>>
AMEND SECTION 8.0 AMERITECH FEATURELINK TO INCLUDE:
8.0 AMERITECH FEATURELINK.
Commission payment and conditions for payment for Ameritech
FeatureLink service are the same as those set forth above for ACS
Centrex, except that no Commitment Bonus is available for the sale of
Ameritech FeatureLink, <<and the requirement of a 15 percent increase
in lines does not apply for new sales of Ameritech FeatureLink.>>
September 1, 1999 Ameritech Authorized Distributor Agreement Modifications
Ameritech Confidential 2
<PAGE> 100
AMEND SECTION 9.0 OTHER VOICE PRODUCTS TO REFLECT THE FOLLOWING
ADDITIONS/DELETIONS:
9.0 OTHER VOICE PRODUCTS
9.1 The commission payment schedule set forth below applies to New
sales of the following Products:
CALLER ID
CUSTOM CALLING SERVICES
LINEBACKER
[[LOCAL ACCESS LINES]]
PBX TRUNKS
REMOTE CALL FORWARDING
VOICE MAIL SERVICE
<TABLE>
<CAPTION>
Objective [[Winback Bonus]]
Attainment Upfront [[(See Note)]] Residual
---------- ------- ------------- --------
<S> <C> <C> <C>
* * * *
</TABLE>
[[Note: The winback bonus applies only to the sale of Local
Access Lines]]
ADD A SECTION 9.1.1 WHICH READS:
<<9.1.1 The commission payment schedule set forth below applies to
New sales of local access lines:>>
<TABLE>
<CAPTION>
<<Objective
Attainment Upfront Winback Bonus
---------- ------- -------------
<S> <C> <C>
* * *
</TABLE>
MODIFY SECTION 9.3 RESIDUAL COMMISSION PAYMENTS TO READ:
9.3 <<Residual Commission Payments>>. Residual Commission Payments
will be paid for a period of twenty four (24) months, and in no
event will AD be eligible for Residual Commission Payment on the
above Products after twenty four (24) monthly commission payments
have been made. <<There are no residual payments on access
lines.>>
September 1, 1999 Ameritech Authorized Distributor Agreement Modifications
Ameritech Confidential 3
<PAGE> 101
AMEND SECTION 13.4.1 COMPLETELINK TO READ:
13.4.1 CompleteLink
b) Commission Payment Schedules for the Minimum Annual Toll Usage
Commitment (MATUC)
September 1, 1999 Ameritech Authorized Distributor Agreement Modifications
Ameritech Confidential 4
<PAGE> 102
<TABLE>
<CAPTION>
12 Month Contract
Objective Attainment
--------------------------------------
Upfront
Upfront Upfront
MATUC * * * <<Winback Bonus>>
----- --------- ---------- -------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
<TABLE>
<CAPTION>
36 Month Contract
Objective Attainment
---------------------------------------
Upfront
Upfront Upfront
MATUC * * * <<Winback Bonus>>
----- --------- ---------- -------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
September 1, 1999 Ameritech Authorized Distributor Agreement Modifications
Ameritech Confidential 5
<PAGE> 103
<TABLE>
<CAPTION>
<<60 Month Contract Objective>>
<<Attainment>>
--------------------------------------
Upfront
Upfront Upfront
MATUC * * * <<Winback Bonus>>
----- --------- ---------- -------- -------------
<S> <C> <C> <C> <C>
* * * * *
</TABLE>
AMEND SECTION 13.11 CONTRACT UPGRADE OR MIGRATION TO READ:
13.11 CONTRACT UPGRADE OR MIGRATION
a) <<Commission Payment>>
(i) Only Upgrades or Migrations from Enhanced ValueLink
Plus to CompleteLink will be paid as New. Customers
with both Enhanced ValueLink Plus and ValueLink
Extra are not eligible. [[Upfront Commission will
not be paid for any other Upgrade or Migration
sales.]]
(ii) The commission payment for a CompleteLink Upgrade or
Migration sale will [[consist only of the commission
payment appropriate for the MATUC component of the
Upgrade or Migration sale. Commission will not be
paid for any other Upgrade or Migration sales.]]
<<be paid only when there is a Winback of toll and
will consist of the commission payment applicable to
the MATUC component plus the Winback Bonus
component.>>
(iii) <<Commission will not be paid for any other Upgrade
or Migration sales.>>
September 1, 1999 Ameritech Authorized Distributor Agreement Modifications
Ameritech Confidential 6
<PAGE> 104
December 3, 1999
Dear Authorized Distributor
Re: <<Notice of Contract Change - Modifications to Exhibit C,
COMMISSION, Authorized Distributor Agreement effective
January 1, 1999, as last amended September 1, 1999>>
This Notice is sent pursuant to Article 15 of the above-referenced Agreement.
The contract change(s), modification(s) or addition(s) are effective thirty (30)
calendar days after the date of this letter. ADDITIONS TO THE CONTRACT ARE
REFLECTED WITH <<UNDERSCORE>> AND DELETIONS BY [[STRIKETHROUGH]]. WHERE AN ITEM
IS UNDERLINED AND HAS A STRIKETHROUGH, THE STRIKETHROUGH TAKES PRECEDENCE.
(NOTE: Due to the limitations of the EDGAR System, underscores will be preceded
by "<<" and followed by ">>". Strikethroughs will be preceded by "[[" and
followed by "]]".)
John Maloney
Channel Manager
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
1
<PAGE> 105
MODIFY <<SECTION 1.7>> <<HOUSE ACCOUNTS>> TO READ:
<<Section 1.7>> <<House Accounts>>. Ameritech reserves the right to
identify certain accounts as "House Accounts", and AD is not authorized to, and
shall not Distribute Products to such accounts. A list of House Accounts is set
forth under Exhibit F of this Agreement, incorporated by reference herein, and
Ameritech, at its sole discretion, may modify Exhibit F from time-to-time via
the # <<Authorized Distributor>> web site and bulletin
board, and each modification will be deemed incorporated herein as if originally
set forth herein, and the modification shall be effective on the date the
modification is posted on the web site and bulletin board.
MODIFY ARTICLE 5 AUTHORIZED DISTRIBUTOR DUTIES, <<SECTION 5.3>> <<SALES
ACHIEVEMENT>> TO READ:
<<Section 5.3>> <<Sales Achievement>>. The AD shall satisfy minimum
monthly, quarterly and annual sales performance requirements as set forth on the
document titled [["AD Annual Objective Sheet and Tier Multiplier" effective
January 1, 1999,]] <<"Authorized Distributor Objectives">> which has been signed
by each party and which is incorporated by reference herein and which may be
modified or amended during the term of this Agreement upon thirty (30) days
written notice by Ameritech to AD, and each such modification or amendment shall
be deemed to have been included as if originally set forth under Attachment 1.
MODIFY ARTICLE 6 AMERITECH'S DUTIES, <<SECTION 6.4>> <<AD INCENTIVE PROGRAMS>>
TO READ:
<<Section 6.4>> <<AD Incentive Programs>>.
(a) Ameritech will provide Co-Operative advertising funds under its
"Ameritech Authorized Distributor Co-Op Program" ("Co-Op"). The terms,
conditions, limitations and obligations of the parties under the Co-Op program
are set forth in the document titled, "The Co-Op and 5-Star Program" dated
January, 1999 set forth under Exhibit D hereto, which is incorporated by
reference herein. Notice of any modification to the Co-Op program will be made
via the # <<Ameritech Authorized Distributor>> web site
and bulletin board, and each modification will be deemed incorporated herein
under Exhibit D as if originally set forth therein in its entirety. The
modification will be effective the date it is posted by Ameritech on the web
site bulletin board. Modification means any change to the Co-Op program, up to
and including discontinuing all or part of the program.
MODIFY ARTICLE 15 NOTICE <<SECTION 15.1>> <<NOTICE>> TO READ:
<<Section 15.1>> <<Notice>>. Unless Notice via
# <<the Ameritech Authorized Distributor web site>> is
expressly identified as proper communication elsewhere in this Agreement, Notice
or other communication given by one party to the other under this Agreement
shall be deemed sufficient and proper if the Notice is in writing and is
delivered personally, or is sent postage prepaid, first class U.S. Mail, or by
overnight courier, and such Notice shall be deemed received by the other party:
a) three (3) days after the Notice is deposited with the U.S. Postal Service;
or, b) the following business day if sent by overnight courier. Notice will also
be deemed sufficient and proper if sent by facsimile provided the original
notice is sent via postage prepaid, first class U.S. Mail the same day as the
facsimile; if sent
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
2
<PAGE> 106
by facsimile Notice will be deemed received by the other party on the date and
time shown on the original transmission confirmation sheet which is
electronically generated by the facsimile machine at the time the transmission
is completed. Notice must be directed as set forth below; each party reserves
the right to change the direction of the Notice, and will do so through proper
Notice to the other party.
MODIFY EXHIBIT B PRODUCTS TO READ:
This is Exhibit B to the Authorized Distributor Agreement between
Ameritech and ("AD") dated January 1, 1999.
AD is authorized to Distribute the Products specified under the
Attachments only if the following conditions are satisfied: i) the
above-referenced Agreement is fully executed by the parties; and, ii) all three
product family Attachment pages of this Exhibit are fully executed by each
party.
Attachment 4 to this Exhibit specifies which Products retire AD's sales
objective [[in a Product family]]. Sales of Products which do not retire the
AD's objective are treated differently for purpose of commission, and such
treatment is specified in Exhibit C.
MODIFY EXHIBIT B, ATTACHMENT 1 VOICE NETWORK PRODUCTS TO READ:
EXHIBIT B, ATTACHMENT 1
VOICE NETWORK PRODUCTS
ATTACHMENT 1: VOICE NETWORK PRODUCTS AND SERVICES
This is incorporated as Attachment 1 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and ("AD") dated January 1, 1999.
[[Ameritech 1 800 CONFERENCE]]
Ameritech 9-1-1 Locator ID
Ameritech Caller ID
Ameritech Centrex Service (Includes ISDN Centrex)
Ameritech Custom Calling Services
[[Ameritech Digital Transport Service Enhanced(ADTS-E)]]
[[Ameritech DSO (except Total Access Service)]]
[[Ameritech DS1 (except Total Access Service)]]
Ameritech FeatureLink
[[Ameritech ISDN Direct Servioc]]
[[Ameritech ISDN Prime Service]]
Ameritech Linebacker
Ameritech Local Access Lines
Ameritech PBX Trunks <<(excludes DID)>>
Ameritech Remote Call Forwarding
Ameritech SmartFax Connections
Ameritech Voice Mail
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
3
<PAGE> 107
MODIFY EXHIBIT B, ATTACHMENT 3 USAGE PRODUCTS TO READ:
EXHIBIT B, ATTACHMENT 3
USAGE PRODUCTS
ATTACHMENT 3: USAGE PRODUCTS AND SERVICES
This is incorporated as Attachment 3 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and ("AD") dated January 1, 1999.
<<Ameritech CompleteLink Product Family>>
Ameritech 1-800-CONFERENCE
[[Ameritech 9-1-1 Locator ID]]
[[Ameritech Caller ID]]
[[Ameritech Custom Calling Services]]
[[Ameritech Digital Transport Service - Enhanced (ADTS-E)]]
[[Ameritech Linebacker]]
[[Ameritech Local Access Lines]]
[[Ameritech PrePaid Products]]
[[Ameritech PBX Trunks]]
[[Ameritech Remote Call Forwarding]]
[[Ameritech SmartFax Connections]]
[[Ameritech ValueLink Product Family]]
[[Ameritech Voice Mail]]
MODIFY EXHIBIT B, ATTACHMENT 4 OBJECTIVE RETIREMENT PRODUCT LIST (BY PRODUCT
FAMILY) TO READ:
EXHIBIT B, ATTACHMENT 4
OBJECTIVE RETIREMENT PRODUCT LIST [[(BY PRODUCT FAMILY)]]
ATTACHMENT 4: OBJECTIVE RETIREMENT PRODUCT LIST [[(BY PRODUCT FAMILY)]]
This is incorporated as Attachment 4 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and ("AD") dated January 1, 1999.
The products and services identified in each Annex to this Attachment
will or will not retire an AD's objective [[for the product family specified on
the Annex]] as indicated in the column titled "Objective Retirement".
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
4
<PAGE> 108
MODIFY EXHIBIT B, ATTACHMENT 4 ANNEX 1 VOICE NETWORK PRODUCTS TO READ:
EXHIBIT B, ATTACHMENT 4
ANNEX 1
VOICE NETWORK PRODUCTS
ANNEX 1: VOICE NETWORK PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 1 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and ("AD") dated January 1,
1999.
<TABLE>
<CAPTION>
------------------------------------------------------------------- ----------------------------
ELIGIBLE PRODUCTS AND SERVICES OBJECTIVE RETIREMENT
------------------------------------------------------------------- ----------------------------
<S> <C>
[[Ameritech 1-800-CONFERENCE]] [[Yes]]
------------------------------------------------------------------- ----------------------------
Ameritech 9-1-1 Locator ID Yes
------------------------------------------------------------------- ----------------------------
Ameritech Caller ID Yes
------------------------------------------------------------------- ----------------------------
Ameritech Centrex Service (Includes ISDN Centrex Yes
------------------------------------------------------------------- ----------------------------
Ameritech Custom Calling Services Yes
------------------------------------------------------------------- ----------------------------
[[Ameritech Digital Transport Service-Enhanced (ADTS-E)]] [[Yes]]
------------------------------------------------------------------- ----------------------------
[[Ameritech DSO (except Total Access Service)}]] [[No]]
------------------------------------------------------------------- ----------------------------
[[Ameritech DS1 (except Total Access Service)]] [[No]]
------------------------------------------------------------------- ----------------------------
Ameritech FeatureLink Yes
------------------------------------------------------------------- ----------------------------
[[Ameritech ISDN Direct Service]] [[Yes]]
------------------------------------------------------------------- ----------------------------
[[Ameritech ISDN Prime Service]] [[Yes]]
------------------------------------------------------------------- ----------------------------
Ameritech Linebacker Yes
------------------------------------------------------------------- ----------------------------
Ameritech Local Access Lines Yes
------------------------------------------------------------------- ----------------------------
Ameritech PBX Trunks <<(excludes DID)>> Yes
------------------------------------------------------------------- ----------------------------
Ameritech Remote Call Forwarding Yes
------------------------------------------------------------------- ----------------------------
Ameritech SmartFax Connections Yes
------------------------------------------------------------------- ----------------------------
Ameritech Voice Mail Yes
------------------------------------------------------------------- ----------------------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
5
<PAGE> 109
MODIFY EXHIBIT B, ATTACHMENT 4 ANNEX 3 USAGE PRODUCTS TO READ:
EXHIBIT B, ATTACHMENT 4
ANNEX 3
USAGE PRODUCTS
ANNEX 3: USAGE PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 3 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and ("AD") dated January 1,
1999.
<TABLE>
<CAPTION>
--------------------------------------------------------------------- ---------------------------
ELIGIBLE PRODUCTS AND SERVICES OBJECTIVE RETIREMENT
--------------------------------------------------------------------- ---------------------------
<S> <C>
<<Ameritech CompleteLink Product Family>> <<No>>
--------------------------------------------------------------------- ---------------------------
Ameritech 1-800-CONFERENCE]] [[Yes]]<<No>>
--------------------------------------------------------------------- ---------------------------
[[Ameritech 9-1-1 Locator ID]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech Caller ID]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech Custom Calling Services]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech Digital Transport Service - Enhanced (ADTS-E)]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech Linebacker]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech Local Access Lines]] [[No]]
--------------------------------------------------------------------- ---------------------------
Ameritech PrePaid Products [[Yes]]<<No>>
--------------------------------------------------------------------- ---------------------------
[[Ameritech PBX Trunks]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech Remote Call Forwarding]] [[No]]
--------------------------------------------------------------------- ---------------------------
[[Ameritech SmartFax Connections]] [[Yes]]
--------------------------------------------------------------------- ---------------------------
Ameritech ValueLink Product Family [[Yes]]<<No>>
--------------------------------------------------------------------- ---------------------------
[[Ameritech Voice Mail]] [[No]]
--------------------------------------------------------------------- ---------------------------
</TABLE>
MODIFY EXHIBIT C COMMISSION TO READ:
EXHIBIT C
COMMISSION
EXHIBIT C COMMISSION
This is incorporated as Exhibit C to the Authorized Distributor
Agreement Between Ameritech and Network Business Solutions, Inc. ("AD") dated
January 1, 1999 (hereinafter the "Agreement").
1.0 GENERAL
1.1 <<Definitions>>
As used in this Agreement, the following definitions apply:
"<<AD OF RECORD>>" shall mean the Authorized Distributor firm
credited with the sale of a new or renewed Centrex System or
PrePaid Products.
"<<BASE COMMISSION>>" shall mean the amount paid upfront to an
AD for sales of Ameritech Products. The base commission may
increase as an AD's objective increases relative to other ADs.
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
6
<PAGE> 110
"<<BILLABLE REVENUE>>" shall mean those Recurring and
Non-Recurring charges which result from the customer service
order(s) which result from the sale submitted by the AD.
"<<COMPLETED ORDERS>>" shall mean a "completed" status in an
Ameritech service ordering or billing systems.
"<<CONTRACT VALUE" OR "CV>>" shall mean the value of the
Recurring and Non-Recurring revenue charges for each product
which is used by Ameritech for purposes of establishing the
value of a sale for commission purposes.
"<<ELIGIBLE PRODUCT" OR "PRODUCT ELIGIBILITY>>" shall mean
those Products the AD is authorized to promote, market and
sell under this Agreement and which are identified fully under
Exhibit B of the Agreement. AD is authorized to sell all the
Products, but only sales of those Products for which AD has an
annual sales objective will retire the AD's sales objective
[[for that product family.]]
"<<GROWTH REVENUE" shall mean one month of the Recurring
Revenue associated with the New sale of a Product included in
Exhibit B, Attachment 1, Voice Network Products, and
Attachment 2, Standard Data Products. Only Growth Revenue can
retire an AD's sales objective.>>
"<<MIGRATION>>" occurs when a customer with an existing
Ameritech Usage contract signs a new contract for a different
Ameritech Usage product, and that product is deemed solely by
Ameritech to be within the same product family as the replaced
product.
[["<<NETTING>>" is applied to the sale of certain ValueLink
products when existing products such as, but not limited to,
centrex are already existing at that location of the
customer.]]
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
7
<PAGE> 111
"<<NEW>>" shall mean the sale of a Product to a customer who
does not currently have that specific Product and Ameritech in
its sole discretion will determine if customer currently has
the Product. To retire an AD's objective [[in the applicable
product family,]] the sale must be made in the AD's Objective
Territory and must be an Eligible Product. In no event will a
sale which is classified by Ameritech in its sole discretion
as a Recast, a Renewal, a Renegotiation, a Migration or an
Upgrade be considered a "New" sale for purposes of the
Agreement.
"<<NON-RECURRING REVENUE>>" shall mean those one-time billed
charges which are a result of a sale by AD.
"<<OBJECTIVE BONUS>>" shall mean the amount paid as the
Upfront Payment once an AD exceeds the sales volume
thresholds, as those sales volumes are stated in dollars, and
which are related to the AD's annual [[product family]] sales
objective in each state. The amount of the Objective Bonus
payment may increase over the term of this Agreement based
upon the AD's objective relative to other ADs' objectives. The
Objective Bonus payment shall apply only to New sales of
Products which retire the objective [[for its product family]]
in the Objective Territory.
"<<OBJECTIVE RETIREMENT>>" shall mean the process whereby New
sales of Ameritech Products retire the <<sales>> objectives
[[for the product family. In the event a Product retires AD's
Objective as specified under Exhibit B, Attachment 4 in more
than one product family, New sales of those products will
retire the AD's objective in one, and only one, product family
in the following order: (i) Data; (ii) Voice; and (iii)
Usage.]] Sales of Products which do not retire objective (see
Attachments to Exhibit B) are considered "Sales Without
Objective Retirement" for purposes of this Agreement.
"<<OBJECTIVE REVENUE>>" shall mean that dollar amount which is
considered the unit of measure to retire an AD's sales
objective [[in a product family]]. <<Only Growth Revenue can
retire an AD's sales objective.>> Objective Retirement shall
equal one month of the Recurring Revenue associated with the
New sale of a Product.
"<<OBJECTIVE TERRITORY>>" shall mean a sales area or region
which is a sub-set of AD's authorized Territory. Objective
Retirement is satisfied only by sales in AD's Objective
Territory, and Ameritech in its sole discretion will establish
and assign AD an "Objective Territory".
"<<OBJECTIVE TIER ("TIER")>>" means that the AD has been
assigned to Tier I, Tier II or Tier III for purposes of
commission value calculation and Objective Retirement.
Determining the Tier the AD is assigned is at the sole
discretion of Ameritech.
"<<PARTNERING>>" means that the AD is not the sole sales
entity in the sales effort with a particular customer, and AD
markets Product(s) to a particular customer with another AD or
Ameritech sales representative. AD must receive prior written
approval by Ameritech for each Partnering effort, and
commission will not be paid on sales which result from such
efforts without the prior written consent of Ameritech.
Ameritech reserves the right to set commission values for each
partnering arrangement.
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
8
<PAGE> 112
"<<RECAST/RENEWAL/RENEGOTIATION>>" collectively shall mean a
sale of Data or Voice, or a sales which includes data and
voice, and such sale is not classified as a New sale for
purposes of Objective Retirement or Commission Payment
purposes. For purposes of the Agreement, a sale will be deemed
a Recast or a Renewal (whichever is appropriate) when a
customer signs a new contract for a Product, and the customer
already subscribes to the same Ameritech product or to an
Ameritech product which is deemed solely by Ameritech to be
similar to the Product covered under the new contract, and the
new contract extends the customer's term commitment for the
Product.
A sale will be deemed a Renegotiation when a customer enters
into a new contract with Ameritech for a Product they already
subscribe to, and the terms of the contract are substantially
changed from the contract then-in-effect for that Product, and
Ameritech determines, in its sole discretion that the sale is
eligible for commission payment to the AD at the Renegotiation
rate.
"<<RECURRING REVENUE>>" shall mean those monthly charges
billed to the customer for Products as a result of a sale by
AD.
"<<RESIDUAL PAYMENT>>" shall mean the commission payment which
is paid by Ameritech over time, and the time period for
payment is established by Ameritech based on contract term or
other factors relevant to the sale. Ameritech determines the
amount and payment schedule in its sole discretion.
"<<TAKEBACK>>" shall mean commission amounts which are
forfeited or returned by the AD as a result of a customer
discontinuing its subscription to the Product(s). In the event
the Takeback is accomplished by the AD returning commissions
already paid, Ameritech will debit the AD's future commission
payments by the amount to be returned. If such a debit does
not satisfy the Takeback amount, Ameritech may demand full
payment from the AD immediately.
"<<TERRITORY>>" is defined under Exhibit B of the Agreement
and the rules governing payment of commission for sales made
to customers outside the Territory are set forth in the
Agreement.
"<<UPFRONT COMMISSION PAYMENT>>" shall mean that portion of
the total commission paid to the AD upon Ameritech's
verification that the order(s) associated with the sale are
Completed Orders.
"<<UPGRADE>>" means that a customer signs a contract for an
Ameritech Product to which the customer already subscribes, or
for a Product which Ameritech deems is similar to the Product
the customer already subscribes to, and the new contract is
for a term that extends the customer's contract term beyond
the existing contract's expiration date, <<and>> the new
contract includes a product commitment which is larger than
that which is in effect at the time of the new contract.
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
9
<PAGE> 113
"<<WINBACK BONUS>>" shall mean the incremental commission
amount paid to AD because the sale of an Eligible Product is
deemed solely by Ameritech to satisfy Ameritech's criteria to
be classified as a "winback" sale as that term is understood
in the telecommunications industry.
MODIFY 5.0 SALES OUTSIDE OF TERRITORY AND SALES OUTSIDE OF "OBJECTIVE TERRITORY"
TO READ:
5.0 SALES OUTSIDE OF TERRITORY AND SALES OUTSIDE OF "OBJECTIVE TERRITORY"
In the event the AD sells Product outside of the Territory,
and such sale has received Ameritech's prior written consent, the
commission payment for such sale will be established by Ameritech at
its sole discretion.
In the event that AD sells Product for which the AD does not
have a sales objective, (which is deemed a sale outside of Objective
Territory), the sale is subject to a twenty-five percent (25%)
reduction in the Upfront Commission Payment. <<This provision does not
apply to sales of Usage Products since Usage Products do not carry a
sales objective.>>
MODIFY 6.0 PARTNERING TO READ:
6.0 PARTNERING
Provided a Partnering arrangement complies with the
requirements under Article 7, Section 7.7 of the Agreement, Ameritech
will pay commission on such sales. The general commission payment
treatment for a Partnering sale is that AD will be paid an Upfront
Commission Payment equal to fifty percent (50%) of the Upfront
Commission Payment which would be paid for the same sale if no
Partnering took place. If two ADs partner, each will receive this
reduction. An exception to the general commission payment treatment for
a Partnering sale when the Partnering efforts are with an Ameritech GBS
Territory Manager <<or Universal Account Executive>>, and the result of
the effort is a Data Product sale, the Upfront Commission Payment for
all resulting sales will be twenty-five percent (25%) less than the
Upfront Commission Payment for the same sale if no Partnering took
place.
MODIFY 7.0 CENTREX PRODUCT FAMILY, SECTION 7.3 NEW CENTREX SALES TO READ:
7.3 <<New Centrex Sales.>> Commission on New Centrex system sales
will be paid provided the sale results in a net increase in
Centrex station lines of at least fifteen percent (15%) of the
existing installed system. In Indiana, the Centrex station
line net increase must be at least one hundred percent (100%)
of the existing installed system. <<If the Centrex system
sales results in a zero (0) to fourteen and nine tenths (14.9)
percent net increase in Centrex station lines, the sales will
be paid as section 7.10d. In Indiana, if the Centrex system
sale results in zero (0) to seventy-four and nine tenths
(74.9) percent net increase in Centrex station lines, the
sales will be paid as section 7.10d.>>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
10
<PAGE> 114
MODIFY SECTION 7.4 <<UPFRONT COMMISSION PAYMENT SCHEDULE>> TO READ:
The Upfront Commission Payment schedule set forth below
applies to New Centrex system sales. The Commission Payments
are stated in terms of one Centrex station line; the actual
Commission Payment for a particular sale will be based on the
number of lines sold, and, the Commission Payment amount will
be calculated by multiplying the rate set forth below for a
single Centrex station line by the total number or station
lines sold.
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------
ACS and Indiana Advanced Centrex
------------------------------------------------------------------------------------------
Month-to- 36 Months 60 Months 84 Months
Month
------------ ------------------ ----------------- ----------------- ------------------
<S> <C> <C> <C> <C>
Illinois
Indiana
Michigan * * * *
Ohio
Wisconsin
------------ ------------------ ----------------- ----------------- ------------------
</TABLE>
MODIFY SECTION 7.4.1 AVN CENTREX FEATURE TO READ:
7.4.1 AVN Centrex Feature
AVN Centrex feature is paid at a *
<<U>>[[up]]front commission payment. No residuals
apply to AVN Centrex feature sales. ADs shall not
receive commission on AVN Centrex feature renewals.
MODIFY SECTION 7.7 <<COMMITMENT BONUS>> TO READ:
7.7 <<Commitment Bonus>>
If a new Centrex sale results in a contract which commits the
customer to a number of Centrex station lines which Ameritech
identifies in the chart that follows here as the appropriate
number of lines based upon the number of lines sold, the AD
will be eligible to receive the commitment bonus. The
commitment bonus increases the Upfront Commission Payment by
fifteen percent (15%). Ameritech, in its sole discretion, will
determine if a sale is eligible for the Commitment Bonus. The
following schedule will be used to determine the applicability
of the commitment bonus for ACS and ISDN Centrex.
<TABLE>
<CAPTION>
----------------------------------------------------
Number of Lines Sold Number of Lines Committed
------------------------- -------------------------
<S> <C> <C>
<<2-6>> [[2 - 7]] 2
<<7-24>> [[8 - 25]] 7
<<25-49>> [[26 - 50]] 25
<<50-99>> [[51 - 100]] 50
<<100-199>> [[101 - 200]] 100
<<200-499>> [[over 200]] 200
<<over 500>> <<500>>
------------------------- -------------------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
11
<PAGE> 115
MODIFY SECTION 7.10 <<RECASTS, RENEWALS, RENEGOTIATIONS OF EXISTING CENTREX
CONTRACTS>>, c) TO READ:
c) After a customer contract has expired, and the
customer is under a month-to-month term for that
Product, any sale of that Product which is submitted
by AD will be considered a Recast or Renewal for
purposes of commission. If the customer contract
expired six (6) or more months prior to the AD's
submission, and the customer has been on a
month-to-month subscription for that period,
Ameritech will pay commission at the New sale rate
<<provided that sale meets the requirements defined
in 7.3>>.
MODIFY SECTION 7.12 <<TAKEBACK>> TO READ:
7.12 <<Takeback>>. The Upfront Commission Payment <<and all bonuses
are>> [[is]] subject to Takeback in the event the customer
discontinues a service (for any or no reason) for which AD
received commission in the past. The Takeback amount will be
based upon the length of time the customer retained the
service and whether the sale was under a term contract:
MODIFY SECTION 8.0 AMERITECH FEATURELINK TO READ:
Commission payment and conditions for payment for Ameritech
FeatureLink service are the same as those set forth above for
ACS Centrex, except that no Commitment Bonus is available for
the sale of Ameritech FeatureLink, and the requirement of a
15% increase in lines does not apply for <<New>> [[new]] sales
of Ameritech FeatureLink.
MODIFY SECTION 9.0 OTHER VOICE PRODUCTS TO READ:
9.1 <<Other Voice Products are not compensated when sold on
Centrex services.>> The commission payment schedule set forth
below applies to New sales of the following Products:
MODIFY SECTION 12.0 ELIGIBLE STANDARD DATA PRODUCTS, e) TO READ:
e) <<Takeback.>> If the AD received commission for a
Product subject to this Section 12.0, and the
customer discontinues the Product for any reason,
Takeback applies. The amount of Takeback is based
upon the length of time the customer retained the
service and if the sale was a term contract: a) if
the customer discontinues the Product during the
first fifty percent (50%) of the contract term, the
Takeback amount<<, including Upfront Commission and
all bonuses,>> will be prorated to the length of time
remaining on the customer's contract; b) if the
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
12
<PAGE> 116
customer discontinues a month-to-month subscription
of the Product within sixty (60) days of
installation, the Takeback will equal one-hundred
percent (100%) of the Upfront Commission Payment
<<and all bonuses>>. Residual Commission Payments
cease when a contract is discontinued.
MODIFY SECTION 13.0 COMPLETELINK AND VALUELINK PRODUCTS TO READ:
13.0 COMPLETELINK AND VALUELINK PRODUCTS
13.1 For purposes of the Agreement, the Products referenced in this
Section 13.0 are collectively classified by Ameritech as the
tariffed Ameritech CompleteLink and ValueLink product
families. The conditions and limitations regarding the sale of
Products apply to the tariffed CompleteLink and ValueLink
product families, including, without limitation, that the AD
shall not sell the Products, and is not entitled to commission
on sales to customers who are not designated by Ameritech as
retail business customers.
13.2 <<Month-to-month subscriptions. >>In no event will AD be
awarded commission for month-to-month CompleteLink or
ValueLink product sale.
13.3 <<Enhanced ValueLink Plus>>. The commission payment schedule
provided below applies to New sales of Enhanced ValueLink
Plus.
a) Commission Payment Schedule
<TABLE>
<CAPTION>
-------------------------------------------------------------
12 Month Contract
[[Objective Attainment]]
-------------------------------------------------------------
Minimum Annual [[Upfront
Revenue Upfront [[Upfront
Commitment * Residual * *
-------------------- --------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
* * * * *
-------------------- --------------- -------------- -------------- ---------------
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------------------------
24 Month Contract
[[Objective Attainment]]
-------------------------------------------------------------
Minimum Annual [[Upfront
Revenue Upfront [[Upfront
Commitment * Residual * *
-------------------- --------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
* * * * *
-------------------- --------------- -------------- -------------- ---------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
13
<PAGE> 117
<TABLE>
<CAPTION>
-------------------------------------------------------------
36 Month Contract
[[Objective Attainment]]
-------------------------------------------------------------
Minimum Annual [[Upfront
Revenue Commitment Upfront [[Upfront
* Residual * *
-------------------- --------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
* * * * *
-------------------- --------------- -------------- -------------- ---------------
</TABLE>
b) <<CV>>. The CV for the above schedule is determined
by the following formula:
(MARC) x (Contract Length in Years) = CV
13.4.1 CompleteLink. The commission award and payment schedules
provided below apply to orders solicited by AD for New sales
of CompleteLink only under the conditions which follow. The
commission schedules below apply to a New CompleteLink
contract with a MARC of $700 or $1,200 (when such MARCs are
properly indicated on the customer contract) if and only if
the New sale also includes the New sale of at least one of the
following products: (i) one or more Local Access Lines or PBX
Trunks, (ii) one or more Centrex Lines and/or (iii) one or
more ISDN Direct Lines.
When the New sale of the CompleteLink with a MARC of $700 or
$1,200 does not include the New sale of at least one of the
above referenced products, the Base and Residual commission
Payments[[, and the Objective Revenue amount]] will be reduced
by fifty percent (50%).
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
14
<PAGE> 118
a) Commission Payment Schedules for the Minimum Annual
Revenue Commitment (MARC)
<TABLE>
<CAPTION>
--------------------------------------------------------------
12 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------
[[Upfront
Upfront [[Upfront
MARC * Residual * *
-------------------- ---------------- ---------------- ------------ ---------------
<S> <C> <C> <C> <C>
* * * * *
-------------------- ---------------- ---------------- ------------ ---------------
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------------
36 Month Contract
[[Objective Attainment]]
----------------------------------------------------------------
[[Upfront
Upfront [[Upfront
MARC * Residual * *
-------------------- ----------------- ---------------- ------------- ---------------
<S> <C> <C> <C> <C>
* * * * *
-------------------- ----------------- ---------------- ------------- ---------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
15
<PAGE> 119
<TABLE>
<CAPTION>
-------------------------------------------------
60 Month Contract
[[Objective Attainment]]
-------------------------------------------------
[[Upfront
Upfront [[Upfront
MARC * Residual * *
-------- ----------------- ---------------- ------------ ------------
<S> <C> <C> <C> <C>
* * * * *
-------- ----------------- ---------------- ------------ ------------
</TABLE>
b) Commission Payment Schedules for the Minimum
Annual Toll Usage Commitment (MATUC)
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
16
<PAGE> 120
<TABLE>
<CAPTION>
-------------------------------------------------
12 Month Contract
[[Objective Attainment]]
-------------------------------------------------
[[Upfront Winback
Upfront [[Upfront Bonus
MATUC * * *
-------- ----------------- ---------------- ------------ ----------------
<S> <C> <C> <C> <C>
* * * * *
-------- ----------------- ---------------- ------------ ----------------
</TABLE>
<TABLE>
<CAPTION>
--------------------------------------------------
36 Month Contract
[[Objective Attainment]]
--------------------------------------------------
[[Upfront Winback
Upfront [[Upfront Bonus
MATUC * * *
---------------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
17
<PAGE> 121
<TABLE>
<CAPTION>
--------------------------------------------------
60 Month Contract
[[Objective Attainment]]
--------------------------------------------------
[[Upfront Winback
Upfront [[Upfront Bonus
MATUC * * *
---------------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
13.7 <<ValueLink Illinois Option F Preferred>>. The commission
payment schedules below applies to New sales of ValueLink
Illinois Option F Preferred.
a) <<Commission Payment Schedules>>
<TABLE>
<CAPTION>
--------------------------------------------------------------------
12 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------------
Minimum
Annual [[Upfront
Minutes of Use Upfront [[Upfront
Commitment * Residual * *
---------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ----------------- ----------------
</TABLE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------
24 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------------
Minimum
Annual [[Upfront
Minutes of Use Upfront [[Upfront
Commitment * Residual * *
---------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ----------------- ----------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
18
<PAGE> 122
<TABLE>
<CAPTION>
--------------------------------------------------------------------
36 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------------
Minimum
Annual [[Upfront
Minutes of Use Upfront [[Upfront
Commitment * Residual * *
---------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ----------------- ----------------
</TABLE>
b) <<CV>>. The CV for the above schedules is determined
by the following formula: (Minimum Annual MOU x Per
Minute Rate) x (Contract Length In Years)
13.8 <<ValueLink Illinois Option F>>. The commission payment
schedules below applies to New sales of ValueLink Illinois
Option F.
a) <<Commission Payment Schedules>>
<TABLE>
<CAPTION>
--------------------------------------------------------------------
12 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------------
Minimum
Annual [[Upfront
Minutes of Use Upfront [[Upfront
Commitment * Residual * *
---------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ----------------- ----------------
</TABLE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------
24 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------------
Minimum
Annual [[Upfront
Minutes of Use Upfront [[Upfront
Commitment * Residual * *
---------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ----------------- ----------------
</TABLE>
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
19
<PAGE> 123
<TABLE>
<CAPTION>
--------------------------------------------------------------------
36 Month Contract
[[Objective Attainment]]
--------------------------------------------------------------------
Minimum
Annual [[Upfront
Minutes of Use Upfront [[Upfront
Commitment * Residual * *
---------------------- ---------------- ---------------- ----------------- ----------------
<S> <C> <C> <C> <C>
* * * * *
---------------------- ---------------- ---------------- ---------------- ----------------
</TABLE>
b) <<CV>>. The CV for the above schedules is determined
by the following formula: (Minimum Annual MOU x Per
Minute Rate) x (Contract Length In Years) = CV
13.10 CompleteLink<< - HQ - Individual Case Basis (ICB) Usage>>. The
following commission payment schedule applies to New sales of
CompleteLink - HQ - Individual Case Basis (ICB) Usage
contracts:
a) <<Upfront Commission Payment Schedule>>
<TABLE>
<CAPTION>
-------------------------------------------------------------------
CompleteLink - HQ - ICB
[[Objective Attainment]]
-------------------------------------------------------------------
Contract <<Upfront>>
Length * * *
---------------------- --------------------- ---------------------- ----------------------
<S> <C> <C> <C>
24 Months
36 Months * * *
60 Months
---------------------- --------------------- ---------------------- ----------------------
</TABLE>
b) <CV>>. The CV for the above schedule is determined by
the following formula: (MBRC) x (Contract Length In
Months) = CV
c) <<Residual Commission Payment>>. No residual
commissions will be paid for CompleteLink - HQ - ICB
Usage sales.
d) <<Contract terms different than presented above>>. If
a CompleteLink - HQ - ICB Usage sale is for a
contract with a term different than presented in the
above table, the commission payment for such a sale
will use the Commission Payment Schedule set forth
above for the next lowest contract length.
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
20
<PAGE> 124
13.11 CONTRACT UPGRADE OR MIGRATION
a) <<Commission Payment>>
(i) Only Upgrades or Migrations from Enhanced
ValueLink Plus to CompleteLink will be paid
as New. Customers with both Enhanced
ValueLink Plus and ValueLink Extra are not
eligible.
(ii) The commission payment for a CompleteLink
Upgrade or Migration sale will be paid only
when there is a Winback of toll and will
consist of the commission payment applicable
to the MATUC component plus the Winback
Bonus component.
(iii) Commission will not be paid for any other
Upgrade or Migration sales.
[[b) <<Does Not Retire Objective.>> Neither an Upgrade nor
a Migration will serve to retire the AD's Usage
Product family objective, and neither an Upgrade nor
a Migration is subject to an Objective Bonus.]]
[[C]] b) <<Residual Commission Payment>>. No residual
commissions will be paid for Upgrade or Migration
sales. Additionally, any residual commissions being
paid for the former product will cease.
13.12 <<Takeback>>. If the AD received commission for a Product
subject to this Section 13.0, and the customer discontinues
the Product for any reason, Takeback applies. If the customer
discontinues a Product within one-hundred and eighty days
after the Completed Order date, the Takeback will equal
one-hundred percent (100%) of the Upfront Commission Payment
<<and all bonuses>>. Residual commissions cease effective the
date the customer cancels the product.
13.13 <<Renewals of existing Usage Contracts>>
a) If the customer's contract term in effect at the time
of the Renewal is more than ninety (90) days from the
date the contract expires, commission will not be
paid to AD for a usage contract Renewal, unless
Ameritech has provided prior written approval for
such payment. Contract term is determined by the
original customer signature date.
b) After a customer contract has expired, any sale of
that Product [[with is]] submitted by AD will be
considered a Renewal for purposes of commission. If
the customer contract expired six (6) or more months
prior to the AD's submission, and the customer has
been without a usage contract for that period,
Ameritech will pay commission at the New sale rate.
c) Commission for CompleteLink Renewals will be paid as
follows:
(i) The Base Commission will equal seventy-five
percent (75%) of the amount paid for an
identical New CompleteLink sale.
(ii) The Residual Commission Payment will be paid
at the same rate as an identical New
CompleteLink sale.
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
21
<PAGE> 125
[[d) Objective Retirement. Renewals will not retire the
AD's Usage Product family objective, nor will
renewals be subject to an Objective Bonus.]]
[[13.14 Multi-state Complete Link Contracts.]]
[[a) Multistate contracts will retire objective based upon
the Main BTN.]]
DELETE SECTION 14.2 1-800-CONFERENCE OBJECTIVE ATTAINMENT:
[[14.2 <<Objective Attainment>>. For purposes of Objective Attainment, the
following factors will be applied to the Base Commission Payment to
arrive at the Objective Attainment number:]]
---------------------------- ----------
[[Objective Attainment Factor
---------------------------- ----------
0 - 69.9% 1.00
70 - 99.9% 1.25
100% and over 1.50]]
---------------------------- ----------
DELETE SECTION 15.3 AMERITECH PREPAID PRODUCTS OBJECTIVE ATTAINMENT:
[[15.3 <<Objective Attainment>>. For purposes of objective
attainment, the following factors will be applied to the Base
Commission:]]
---------------------------- ----------------
[[Objective Attainment Factor
---------------------------- ----------------
0 - 69.9% 1.00
70 - 99.9% 1.25
100% and over 1.50]]
---------------------------- ----------------
Effective January 1, 1999
Confidential and Proprietary Information of Ameritech. Not to be disclosed to
another party without prior written consent of Ameritech
22
<PAGE> 126
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 1
[AMERITECH LOGO]
April 18, 2000
Dear Authorized Distributor
Re: <<Notice of Contract Change - Modifications to Authorized
Distributor Agreement effective January 1, 1999, as last amended
December 3, 1999>>
This Notice is sent pursuant to Article 15 of the above-referenced Agreement.
The contract change(s), modification(s) or addition(s) are effective thirty (30)
calendar days after the date of this letter. ADDITIONS TO THE CONTRACT ARE
REFLECTED WITH <<UNDERSCORE>> AND DELETIONS BY [[STRIKETHROUGH]]. WHERE AN ITEM
IS UNDERLINED AND HAS A STRIKETHROUGH, THE STRIKETHROUGH TAKES PRECEDENCE.
(NOTE: Due to the limitations of the EDGAR system, underscores will be preceded
by "<<" and followed by ">>". Strikethroughs will be preceded by "[[" and
followed by "]]".)
John Maloney
Channel Manager
<PAGE> 127
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 2
REVISE ARTICLE 1, SECTION 1.9 TO READ:
<<Section 1.9 End User of Product>>. In no event is AD granted the right or
authority under this Agreement to distribute Products to anyone whom the AD
knows, or should have known, at the time of sale or within two (2) years
thereafter, is: a) not the end user of the Product; b) subscribing to the
Product for the purpose of reselling it to retail customers; or, c) [[is]] not
designated by Ameritech [[GBS]] as a "retail" customer of Ameritech.
REVISE ARTICLE 1, SECTION 1.11 TO READ:
<<Section 1.11 Sole Agreement.>> Ameritech utilizes various channels to
Distribute Product to its retail business customers, and Ameritech's strategy
prohibits cross-over appointments between its channels. Therefore, AD is
prohibited from acting as an Ameritech [[Enhanced Service Provider]],
<<Enterprise Solutions Provider (ESP),>> an Authorized Video Sales
Representative or to enter into any other Distribution agreement with Ameritech
under which an appointment to market or sell landline Products to Ameritech's
retail customers is granted.
MODIFY EXHIBIT A TERRITORY TO READ:
EXHIBIT A
TERRITORY
EXHIBIT A TERRITORY
This is Exhibit A to the Authorized Distributor Agreement Between Ameritech and
SAMPLE ("AD") dated January 1, 1999.
AD is hereby granted the right to distribute in the Territory specified
under this Exhibit. AD's right under the Agreement and this Exhibit is
conditioned on full execution of the Agreement and the signature of both parties
at the end of each Exhibit.
Ameritech and AD agree that sales outside of the Territory are not
encouraged and AD's authority to market, promote or sell Ameritech products to
customers outside of the Territory requires prior written approval by Ameritech.
STATE:
AREA CODES*:
If a business unit is not specifically listed below, sales by AD to
customers classified by Ameritech as served by that business unit are considered
"out of Territory" sales for purpose of this Agreement.**
*Any area code split will result in automatic inclusion of the new area codes
unless AD is otherwise notified in writing by Ameritech.
**Key - CBS means customers of the Custom Business Services business unit
GBS means customers of the General Business Services business
unit
<<GLOBAL MEANS CUSTOMERS OF THE SBC GLOBAL MARKETS BUSINESS UNIT
BCS MEANS CUSTOMERS OF THE BUSINESS COMMUNICATIONS SERVICES
BUSINESS UNIT>>
<PAGE> 128
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 3
MODIFY ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES TO READ:
EXHIBIT B, ATTACHMENT 2
STANDARD DATA PRODUCTS
ATTACHMENT 2: STANDARD DATA PRODUCTS AND SERVICES
This is incorporated as Attachment 2 to Exhibit B to the Authorized
Distributor Agreement between Ameritech and SAMPLE ("AD") dated January 1, 1999.
<<Ameritech.net SpeedPath with ADSL>>
<<Ameritech ADSL Transport Service>>
Ameritech AutoVAN (ANX) Service
Ameritech Analog Video Service
Ameritech Asynchronous Transfer Mode Service (ATM)
Ameritech Broadcast Video Service
Ameritech Connectionless Broadband Data Service (CBDS)
Ameritech Digital Transport Service - Enhanced (ADTS-E)
Ameritech DSO (except Total Access Service)
Ameritech DS1 (except Total Access Service)
Ameritech DS3 (except Total Access Service)
Ameritech Fiber Distributed Data Interface Service (FDDI)
Ameritech Fractional DS1 (384) (except Total Access Service)
Ameritech Frame Relay Service (FRS)
Ameritech Host Interconnection Service (AHIS)
Ameritech Internet Access (Dedicated Access over Frame Relay or CBDS)
Ameritech ISDN Direct Service
Ameritech ISDN Prime Service
Ameritech LAN Interconnect Service (ALIS)
Ameritech Packet Switched Data Service
Ameritech Reconfiguration Service (ARS)
Ameritech Remote Office Access Manager (ROAM)
Ameritech Synchronized Optical Network Service (SONET)
<PAGE> 129
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 4
REVISE ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES OBJECTIVE RETIREMENT TO
READ:
EXHIBIT B, ATTACHMENT 4
ANNEX 2
STANDARD DATA PRODUCTS
ANNEX 2: STANDARD DATA PRODUCTS AND SERVICES
OBJECTIVE RETIREMENT
This is incorporated as Annex 2 to Attachment 4 of Exhibit B to the
Authorized Distributor Agreement between Ameritech and SAMPLE ("AD") dated
January 1, 1999.
<TABLE>
<CAPTION>
ELIGIBLE PRODUCTS AND SERVICES OBJECTIVE RETIREMENT
------------------------------ --------------------
<S> <C>
<<Ameritech.net SpeedPath with ADSL>> <<Yes>>
<<Ameritech ADSL Transport Service>> <<Yes>>
Ameritech AutoVAN (ANX) Service Yes
Ameritech Analog Video Service Yes
Ameritech Asynchronous Transfer Mode Service (ATM) Yes
Ameritech Broadcast Video Service Yes
Ameritech Connectionless Broadband Data Service (CBDS) Yes
Ameritech Digital Transport Service - Enhanced (ADTS-E) Yes
Ameritech DSO (except Total Access Service) Yes
Ameritech DS1 (except Total Access Service) Yes
Ameritech DS3 (except Total Access Service) Yes
Ameritech Fiber Distributed Data Interface Service (FDDI) Yes
Ameritech Fractional DS1 (384) (except Total Access Service) Yes
Ameritech Frame Relay Service (FRS) Yes
Ameritech Host Interconnection Service (AHIS) Yes
Ameritech Internet Access (Dedicated Access over Frame Relay or CBDS) Yes
Ameritech ISDN Direct Service Yes
Ameritech ISDN Prime Service Yes
Ameritech LAN Interconnect Service (ALIS) Yes
Ameritech Packet Switched Data Service Yes
Ameritech Reconfiguration Service (ARS) Yes
Ameritech Remote Office Access Manager (ROAM) Yes
Ameritech Synchronized Optical Network Service (SONET) Yes
</TABLE>
<PAGE> 130
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 5
MODIFY EXHIBIT C COMMISSION, SECTION 1.3 COMMISSION AMOUNT AND PAYMENT SCHEDULES
TO READ:
1.3 <<Commission Amount and Payment Schedules.>> The commission value and the
time of payment for each sale is based upon a number of factors, first
and foremost is the Product sold and the terms and conditions of this
Agreement. To be eligible for commission on a specific sale, the AD must
comply with all Ameritech practices and procedures, including, but not
limited to, those related to the processing of sales and subscriber
agreements by AD, and the accuracy of each submission by AD. Ameritech
reserves the sole right to modify or change any or all of its practices
and procedures related to the AD program, and will provide AD with a
minimum of thirty (30) days prior written Notice of any modification
which will affect the AD's own practices or procedures. Ameritech may
elect to serve this Notice via the [[" *"]]
<<Authorized Distributor>> web site and bulletin board, and the Notice
will be considered given on the date the Notice is posted by Ameritech on
the web site.
MODIFY EXHIBIT C COMMISSION, SECTION 9.1.1 TO READ:
9.1.1 The commission payment schedule set forth below applies to New
sales of local access lines:
<TABLE>
<CAPTION>
Objective
Attainment Upfront [[Winback Bonus]]
---------- ------- -------------
<S> <C> <C>
* * *
</TABLE>
ADD TO EXHIBIT C COMMISSION, UNDER SECTION 9.0 OTHER VOICE PRODUCTS, A SECTION
9.6 THAT READS:
9.6 WINBACK. The commission payment schedule set forth below applies
to Winback sales of local access lines on a per line basis:
<TABLE>
<CAPTION>
<<Winback>>
<<State>> <<Bonus>>
----- -----
<S> <C>
<<Illinois>>
<<Indiana>>
<<Michigan>> *
<<Ohio>>
<<Wisconsin>>
</TABLE>
<PAGE> 131
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 6
MODIFY EXHIBIT C COMMISSION, SECTION 12.4 COMPLEX DATA PRODUCTS TO READ:
12.4 COMPLEX DATA PRODUCTS
a) <<Commission Payment Schedule>>. The following commission
payment schedule applies to New sales and additions to
existing installations of the following Data products:
<<Ameritech ADSL Transport Service>>
Ameritech Synchronized Optical Network Service (SONET)
Ameritech Frame Relay Service (FRS)
Ameritech Connectionless Broadband Data Service (CBDS)
Ameritech Internet Access (Dedicated Access over FRS
or CBDS)
Ameritech Remote Office Access Manager (ROAM)
Ameritech LAN Interconnection Service (ALIS)
Ameritech Host Interconnection Service (AHIS)
Ameritech Fiber Distributed Data Interface Service (FDDI)
Ameritech Asynchronous Transfer Mode Service (ATM)
ADD TO EXHIBIT C COMMISSION, UNDER SECTION 12.0 ELIGIBLE STANDARD DATA PRODUCTS,
SECTIONS 12.8 a) AND 12.8 b) THAT READ:
12.8 <<AMERITECH.NET SPEEDPATH WITH ADSL>>
<<a) The Upfront Commission Payment schedule set forth below applies to
a New sale of an Ameritech.net SpeedPath with ADSL:>>
<TABLE>
<CAPTION>
<<SpeedPath Package>> <<Upfront>>
----------------- -------
<S> <C>
<<768>>
<<768 Office>> *
<<768 Office Plus>>
<<1500 Office Plus>>
</TABLE>
<<b) Objective Attainment. The following factors will be applied to the
Base Upfront Commission Payment for purposes of Objective
Attainment:>>
<TABLE>
<CAPTION>
<<Objective Attainment>> <<Factor>>
-------------------- ------
<S> <C>
* *
</TABLE>
<PAGE> 132
April 18, 2000 Ameritech Authorized Distributor Agreement Modification 7
STRIKE EXHIBIT C COMMISSION, SECTION 13.0 COMPLETELINK AND VALUELINK PRODUCTS,
SECTION 13.4.1 COMPLETELINK:
[[13.4.1 COMPLETELINK. The commission award and payment schedules provided
below apply to orders solicited by AD for New sales of
CompleteLink only under the conditions which follow. The
commission schedules below apply to a New CompleteLink contract
with a MARC of $700 or $1,200 (when such MARCs are properly
indicated on the customer contract) if and only if the New sale
also includes the New sale of at least one of the following
products: (i) one or more Local Access Lines or PBX Trunks, (ii)
one or more Centrex Lines and/or (iii) one or more ISDN Direct
Lines.]]
MODIFY EXHIBIT C COMMISSION, SECTION 13.0 COMPLETELINK AND VALUELINK PRODUCTS,
SECTION 13.11 CONTRACT UPGRADE OR MIGRATION A) AND B) TO READ:
13.11 CONTRACT UPGRADE OR MIGRATION
a) <<Commission Payment>>
(i) Only Upgrades or Migrations from Enhanced ValueLink
Plus, <<ValueLink Illinois product family, and Straight
Rate>> to CompleteLink will be paid as New. Customers with
both Enhanced ValueLink Plus and ValueLink Extra are not
eligible.
(ii) The commission payment for a CompleteLink Upgrade or
Migration sale will be paid only when there is a Winback of
toll and will consist of the commission payment applicable
to the MATUC component plus the Winback Bonus component.
(iii) Commission will not be paid for any other Upgrade or
Migration sales.
b) <<Residual Commission Payment.>> No residual commissions
will be paid for Upgrade or Migration sales.
[[Additionally, any residual commissions being paid for the
former product will cease.]]
