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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 13, 1996
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PREMIERE TECHNOLOGIES, INC.
(Exact name of registrant
as specified in its charter)
Georgia 33-80547 59-3074176
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
3399 Peachtree Road, N.E.
The Lenox Building
Suite 400, Atlanta, Georgia 30326
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(Address of principal executive officers) (Zip Code)
Registrant's telephone number, including area code: (404) 262-8400
N/A
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(Former name or former address, if changed since last report)
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Item 7. Exhibits.
Premiere Technologies, Inc. hereby amends its Current Report on Form 8-K
dated November 13, 1996, filed with the Securities and Exchange Commission (the
"Commission") on November 22, 1996, to amend Exhibit 10.1.
(c) Exhibits.
10.1 Strategic Alliance Agreement dated November 13, 1996, by and
between Premiere Technologies, Inc. and WorldCom, Inc.(1)
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(1) Portions of this exhibit are the subject of a Request for Confidential
Treatment. The copy filed as an exhibit omits the information subject to
the confidentiality request. Such omitted information has been filed
separately with the Commission.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PREMIERE TECHNOLOGIES, INC.
By: /s/ Patrick G. Jones
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Patrick G. Jones
Senior Vice President of Finance and Legal
Dated: February 24, 1997
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EXHIBIT INDEX
10.1 Strategic Alliance Agreement dated November 13, 1996,
by and between Premiere Technologies, Inc. and WorldCom, Inc.(1)
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(1) Portions of this exhibit are the subject of a Request for Confidential
Treatment. The copy filed as an exhibit omits the information subject to
the confidentiality request. Such omitted information has been filed
separately with the Commission.
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EXHIBIT 10.1
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STRATEGIC ALLIANCE AGREEMENT DATED NOVEMBER 13, 1996, BY AND BETWEEN PREMIERE
TECHNOLOGIES, INC. AND WORLDCOM, INC.
PORTIONS OF THIS EXHIBIT ARE THE SUBJECT OF A REQUEST FOR CONFIDENTIAL
TREATMENT. THE COPY FILED AS AN EXHIBIT OMITS THE INFORMATION SUBJECT TO THE
CONFIDENTIALITY REQUEST. SUCH OMITTED INFORMATION HAS BEEN FILED SEPARATELY WITH
THE COMMISSION. SUCH PORTIONS ARE MARKED BY BRACKETS [ ] AND THE PAGES ON WHICH
THEY APPEAR CONTAIN AN ASTERISK (*) IN THE UPPER RIGHT HAND CORNER.
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EXHIBIT 10.1
STRATEGIC ALLIANCE AGREEMENT
----------------------------
THIS STRATEGIC ALLIANCE AGREEMENT (this "Agreement") is made and
entered into as of the 13th day of November, 1996, by and between PREMIERE
TECHNOLOGIES, INC., a Georgia corporation ("Premiere"), and WORLDCOM, INC., a
Georgia corporation ("WorldCom").
Preamble
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Premiere and WorldCom desire to enter into a strategic relationship
for their mutual benefit. Pursuant to this relationship, among other things,
(i) WorldCom will make an investment in Premiere Common Stock, (ii) Premiere
will acquire certain assets from WorldCom's Subsidiaries, (iii) Premiere,
through its Subsidiaries, will provide certain computer telephony services to
WorldCom and its Subsidiaries, and (iv) Premiere and WorldCom, through their
respective Subsidiaries, will identify, pursue and implement certain joint
service offerings to third parties. Premiere and WorldCom believe that the
strategic relationship envisioned in this Agreement will represent an efficient
allocation and utilization of the respective resources of the Parties and will
lead to the development of long term business opportunities and relationships in
a more efficient and effective manner than could be achieved by the Parties
acting alone.
Certain terms used in this Agreement are defined in Section 10.1 of
this Agreement.
ARTICLE 1
WORLDCOM INVESTMENT IN PREMIERE
-------------------------------
1.1 Issuance of Premiere Shares; Cash Payment. In consideration of
-----------------------------------------
the covenants and agreements of WorldCom contained herein and in the Related
Agreements and of the strategic relationship embodied therein, and based upon
the representations and warranties of WorldCom contained herein and in the
Related Agreements, on the date of this Agreement, Premiere shall (a) issue to
WorldCom 2,050,000 shares of Premiere Common Stock, and (b) pay to the order of
WorldCom Four Million Seven Hundred Thousand Dollars ($4,700,000) in cash by
wire transfer to such account as WorldCom shall designate.
1.2 Investment Agreement. As a condition to the issuance of the
--------------------
shares of Premiere Common Stock pursuant to Section 1.1, WorldCom shall enter
into an Investment Agreement with Premiere in the form of Exhibit A (the
---------
"Investment Agreement"), which shall govern WorldCom's investment in Premiere.
WorldCom acknowledges and agrees that the provisions of and restrictions
contained in the Investment Agreement are reasonably related to the promotion of
the strategic relationship
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envisioned by this Agreement and do not unreasonably restrain the alienability
of its investment in Premiere.
ARTICLE 2
PREMIERE PURCHASE OF WORLDCOM ASSETS
------------------------------------
2.1 Purchase and Sale. In consideration of the covenants and
-----------------
agreements of Premiere contained herein, on the date of this Agreement, WorldCom
shall itself and shall cause its relevant Subsidiaries to sell, grant, convey,
assign, transfer and deliver to Premiere, and Premiere shall purchase from
WorldCom and the relevant WorldCom Subsidiaries, the WorldCom Assets, free and
clear of all Liens.
2.2 Transfer Documents. The sale of the WorldCom Assets shall be
------------------
effected through the execution and delivery to Premiere by WorldCom and the
relevant WorldCom Subsidiary of an Assignment Agreement and an Irrevocable Stock
Power in the form of Exhibits B-1 and B-2, respectively (the "Assignment
--------------------
Agreement" and "Irrevocable Stock Power", respectively), together with such
other instruments, financing statements and other documents as Premiere shall
reasonably request to effect and perfect the transfer of title to the WorldCom
Assets to Premiere free and clear of all Liens.
ARTICLE 3
PREMIERE PLATFORM SERVICES
--------------------------
3.1 Preferred Platform Service Provider. Subject to the provisions
-----------------------------------
of Sections 3.2 and 3.3, Premiere, either directly or through one or more of its
Subsidiaries, shall be a "preferred provider" of Platform Services for Enhanced
Calling Programs provided by the WorldCom Companies. As a "preferred provider"
of Platform Services for the WorldCom Companies, Premiere shall (a) be the
exclusive provider of Platform Services for the Enhanced Calling Programs in
development described on Schedule 3.1 hereto (the "Exclusive Programs"), and (b)
be given the right of first opportunity to provide, on a non-exclusive basis,
Platform Services for other Enhanced Calling Programs (the "Preferred Programs")
as set forth in Section 3.2.
3.2 Right of First Opportunity. If any WorldCom Company proposes to
--------------------------
offer a Preferred Program through an unaffiliated provider of Platform Services,
including a Preferred Program that would entail the provision of services or
special applications that are not then in a service offering provided by a
Premiere Company ("Special Services"), WorldCom shall notify Premiere and shall
provide Premiere with the right of first opportunity to provide the Platform
Services relating to the Preferred Program. In furtherance of this obligation,
WorldCom (a) shall provide the notice sufficiently in advance of the anticipated
date of introduction of the Preferred Program (or the anticipated date of use of
an unaffiliated Platform Services provider relating to an existing Preferred
Program), (b) shall consult with the Premiere Representatives concerning the
proposed Preferred Program and (c) shall provide the Premiere Representatives
with such information as to the Preferred Program (e.g., anticipated service
volume, services
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contemplated, including any Special Services and other matters) as the Premiere
Representatives may request. Following such notice, consultation and provision
of information, Premiere shall notify WorldCom in a reasonably prompt manner if
it wishes to exercise its right of first opportunity hereunder. If it so
exercises its right, Premiere and WorldCom shall negotiate in good faith an
agreement concerning the time and requirements for the development of the
Preferred Program, including any Special Services, and the other terms of
Platform Services, including price, and shall incorporate those terms in an
agreement to provide Platform Services as contemplated by Section 3.3 During the
course of those negotiations WorldCom may solicit proposals from alternative
unaffiliated providers of Platform Services, and, if any such bona fide proposal
is received from a qualified alternative service provider, WorldCom shall
provide Premiere with a copy of, and other information as Premiere may
reasonably request concerning, any such proposal. WorldCom shall provide
Premiere with a reasonable opportunity to review any such proposal and to submit
a new or revised proposal in response. If, in its response, Premiere is unable
or unwilling to match the service offering, quality, pricing and other material
terms contained in a bona fide proposal received by WorldCom from such an
alternative provider, WorldCom may contract with such alternative provider to
provide Platform Services on those terms.
3.3 Form of Platform Services Agreement. The relevant Premiere
-----------------------------------
Company shall provide the Platform Services pursuant to the terms and conditions
of the form of Platform Services Agreement attached as Exhibit C hereto
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("Platform Services Agreement") in each case, with appropriate modifications as
mutually acceptable to the Parties to reflect modifications of service
offerings, service standards, pricing, billing arrangements, term and other
matters.
ARTICLE 4
JOINT SERVICE OFFERINGS
-----------------------
4.1 Identification and Pursuit of Offerings. WorldCom and Premiere
---------------------------------------
shall cooperate in good faith and use their respective reasonable best efforts
during the term of this Agreement to identify and pursue opportunities to (a)
sell Premiere Platform Services to various customer contacts of WorldCom, (b)
sell WorldCom voice and data transmission services to various customer contacts
of Premiere, and (c) jointly market Premiere Platform Services and WorldCom
voice and data transmission services to other Persons (collectively, "Joint
Service Offerings"). In furtherance of this effort, WorldCom and Premiere shall
form the Strategic Alliance Committee consisting of WorldCom Representatives and
Premiere Representatives, which shall (i) identify Joint Service Offering
opportunities, (ii) develop marketing strategies for those opportunities,
including service mix and pricing strategies, (iii) coordinate the formation of
the marketing team, (iv) oversee the implementation of the marketing effort,
(iv) oversee the administration of product and service offerings and programs
arising from those marketing efforts, and (v) report on a regular basis to
WorldCom and Premiere regarding the Joint Service Offerings identified, pursued
and implemented. The Strategic Alliance Committee shall meet as
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often as required to carry out its objectives, but in no event less than once
per calendar quarter. WorldCom and Premiere shall cooperate fully with the
Strategic Alliance Committee to support its efforts, including, without
limitation, the provision of information on business opportunities as the
Committee may request from time to time.
4.2 Revenue Sharing Arrangements. In connection with the pursuit of
----------------------------
Joint Service Offerings, WorldCom and Premiere (or their appropriate
Subsidiaries) will negotiate in good faith to enter into marketing or other
agreements with the other Persons involved in the Joint Service Offering ("Joint
Marketing Agreements"). The Joint Marketing Agreements will include, among
other matters, provisions relating to the sharing of revenues produced pursuant
to services provided in connection with the Joint Service Offering . Subject to
variances and other terms as may be negotiated in good faith among the various
parties to the Joint Marketing Agreements, WorldCom and Premiere anticipate that
the revenue sharing arrangements generally will be structured according to the
example set forth on Schedule 4.2 hereto.
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4.3 Protection of Business Opportunity. Premiere and WorldCom agree
----------------------------------
that the Joint Marketing Agreements will provide that (a) so long as any
customer serviced under the Joint Service Offering subject to a Joint Marketing
Agreement remains in place, the revenue sharing agreement set forth in the Joint
Marketing Agreement shall stay in effect, and (b) so long as a Joint Service
Offering is active, a WorldCom Company will provide voice and data transmission
services, and a Premiere Company will provide all Platform Services, on the
terms set forth in the Joint Marketing Agreement, subject to termination only
for default as set forth therein.
4.4 Right to Pursue Opportunities Independently. Notwithstanding the
-------------------------------------------
provisions of this Article 4, but subject to the other provisions of this
Agreement, Premiere and WorldCom understand that the Premiere Companies and
WorldCom Companies are engaging, and may in the future engage, in business
activities competitive with the respective businesses of each other. Subject to
any conflicting provisions of this Agreement and to any specific conflicting
provisions of any Related Agreement, the Parties agree that the Premiere
Companies and the WorldCom Companies may engage in such activities and that no
Party shall bring any action against the other Party claiming that any such
activity is in violation of any duty owed to each other hereunder.
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*
ARTICLE 5
MINIMUM OPERATING INCOME GUARANTEE
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5.1 Minimum Monthly Operating Income. For the [ ]
--------------------------------
period beginning [ ] and ending [ ] (the "Minimum Guarantee
Period"), WorldCom agrees to pay to Premiere on or before the end of the month
(the "Payment Date") following each month (a "Base Month") in the Minimum
Guarantee Period, the positive difference, if any, between (a)[ ]
and (b) the Aggregate Operating Income received by any Premiere Company for the
Base Month (such difference being a "Monthly Deficiency Payment"). If,
subsequent to a Payment Date, any Premiere Company receives a payment relating
to a previous Base Month that would have counted toward the Aggregate Operating
Income amount for that Base Month, such amount shall be added to and become part
of the calculation of Aggregate Operating Income for the month in which it is so
received. Such payments shall be considered "License Fee" revenues to Premiere.
5.2 Late Payment Charge. If WorldCom does not make a required
-------------------
Monthly Deficiency Payment on or before the relevant Payment Date, WorldCom
shall also pay a late fee computed daily commencing with the day immediately
following the Payment Date on the amount of the unpaid balance of the Monthly
Deficiency Payment at the lesser of (a) one and one half percent (1-1/2%) per
month or (b) the maximum rate allowed under applicable Law (a "Late Payment
Charge").
5.3 Rights of Set Off. The Premiere Companies shall have the right
-----------------
to set off against any amounts otherwise payable by a Premiere Company to a
WorldCom Company the amount of any unpaid Monthly Deficiency Payment and Late
Payment Charge due hereunder. The WorldCom Companies shall have the right to
set off against any amounts otherwise payable by a WorldCom Company to a
Premiere Company any unpaid amount due from a Premiere Company to a WorldCom
Company.
5.4 Early Termination of Minimum Commitment. The obligation to pay
---------------------------------------
Monthly Deficiency Payments shall terminate on the first to occur of (a) the
date all Monthly Deficiency Payments for the Minimum Guarantee Period have been
received by Premiere, or (b) the date on which the sum of (i) the Aggregate
Operating Income received by all Premiere Companies for all previous Base Months
and (ii) the aggregate Monthly Deficiency Payments (not including Late Payment
Charges) received by Premiere equals or exceed [ ].
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES
------------------------------
6.1 Representations and Warranties of Premiere. Premiere hereby
------------------------------------------
represents and warrants to WorldCom as follows:
(a) Premiere is a corporation duly organized, validly existing
and in good standing under the laws of the State of Georgia. Premiere has all
requisite corporate power and authority to own, lease and operate its
properties, to carry on its business as now being conducted and to execute and
deliver this Agreement and to perform its terms.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part of
Premiere. This Agreement has been duly and validly executed by Premiere and,
assuming this Agreement constitutes a valid and binding agreement of WorldCom,
represents a valid and binding obligation of Premiere, enforceable in accordance
with its terms subject to the Bankruptcy Exception. The execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, will not conflict with or constitute a breach, violation or
default, or create a Lien, under the Articles of Incorporation or Bylaws of
Premiere or any Law or any judgment, decree, governmental permit or license or
permit, indenture, agreement or instrument of Premiere or to which Premiere is
subject.
(c) The authorized capital stock of Premiere consists of (i)
150,000,000 shares of Premiere Common Stock, of which 21,683,377 shares are
issued and outstanding as of the date of this Agreement, and (ii) 5,000,000
shares of Premiere Preferred Stock, of which no shares are issued and
outstanding. All of the issued and outstanding shares of Premiere Common Stock
are, and all of the shares of Premiere Common Stock to be issued in accordance
with the terms of this Agreement will be, duly authorized, validly issued and
outstanding, fully paid and nonassessable. None of the outstanding shares of
Premiere Common Stock has been, and none of the shares of Premiere Common Stock
to be issued in accordance with the terms of this Agreement will be, issued in
violation of any preemptive rights of any Person or the registration
requirements of applicable Law. There are no restrictions upon the transfer of
or otherwise pertaining to the shares of Premiere Common Stock (including,
without limitation, the ability to pay dividends thereon) or retained earnings
of Premiere or the ownership thereof, other than those imposed by applicable
securities or corporate Law and the Investment Agreement
(d) Premiere has timely filed and made available to WorldCom all
SEC Documents required to be filed by Premiere since December 31, 1995 (the
"Premiere SEC Reports"). The Premiere SEC Reports (i) at the time filed,
complied in all material respects with the applicable requirements of the
Securities Laws and other applicable
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Laws and (ii) did not, at the time they were filed (or, if amended or superseded
by a filing prior to the date of this Agreement, then on the date of such
filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated in such Premiere SEC Reports or necessary in
order to make the statements in such Premiere SEC Reports, in light of the
circumstances under which they were made, not misleading. Other than the
execution and delivery of this Agreement, no event has occurred as a consequence
of which Premiere would be required to file a Current Report on Form 8-K as to
which such a report has not been timely filed with the SEC.
(e) Each of the Premiere Financial Statements (including, in each
case, any related notes) contained in the Premiere SEC Reports complied as to
form in all material respects with the applicable published rules and
regulations of the SEC with respect thereto, was prepared in accordance with
GAAP (except to the extent required by changes in generally accepted accounting
principles, as may be indicated in the notes to such financial statements or, in
the case of unaudited interim statements, as permitted by Form 10-Q of the SEC),
and fairly presented in all material respects the consolidated financial
position, assets and liabilities of Premiere and its Subsidiaries as at the
respective dates and the consolidated results of operations and cash flows for
the periods indicated, except that the unaudited interim financial statements
were or are subject to normal and recurring year-end adjustments which were not
or are not expected to be material in amount or effect.
(f) No Premiere Company has any Liabilities that are reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Premiere, except Liabilities which are accrued or reserved against in the
consolidated balance sheets of Premiere as of December 31, 1995 and June 30,
1996, included in the Premiere Financial Statements or SEC Reports delivered
prior to the date of this Agreement or reflected in the notes thereto. Except as
set forth on the Premiere Disclosure Memorandum, no Premiere Company has
incurred or paid any Liability since June 30, 1996, except for such Liabilities
incurred or paid (i) in the ordinary course of business consistent with past
business practice or (ii) in connection with the transactions contemplated by
this Agreement.
(g) There is no existing, pending or, to the knowledge of
Premiere, threatened event, change or occurrence which could have a Material
Adverse Effect on Premiere except as expressly disclosed in a Premiere SEC
Report or as disclosed in the Premiere Disclosure Memorandum.
(h) This Agreement, and all other documents and information
furnished to WorldCom by Premiere pursuant hereto do not and will not include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements made and to be made not misleading.
6.2 Representations and Warranties of WorldCom. WorldCom hereby
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represents and warrants to Premiere as follows:
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(a) WorldCom is a corporation duly organized, validly existing
and in good standing under the laws of the State of Georgia. WorldCom has all
requisite corporate power and authority to execute and deliver this Agreement
and to perform its terms.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part of
WorldCom. This Agreement has been duly and validly executed by WorldCom and,
assuming this Agreement constitutes a valid and binding agreement of Premiere,
represents a valid and binding obligation of WorldCom, enforceable in accordance
with its terms subject to the Bankruptcy Exception. The execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, will not conflict with or constitute a breach, violation or
default, or create a Lien, under the Articles of Incorporation or Bylaws of
WorldCom or any Law or any judgment, decree, governmental permit or license or
permit, indenture, agreement or instrument of WorldCom or to which WorldCom is
subject.
(c) WorldCom Network Services, Inc., a wholly-owned subsidiary of
WorldCom, owns good and marketable title to the WorldCom Assets free and clear
of all Liens, and has the power and authority to transfer such Assets to
Premiere pursuant hereto.
(d) This Agreement, and all other documents and information
furnished to Premiere by WorldCom pursuant hereto do not and will not include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements made and to be made not misleading.
ARTICLE 7
INDEMNIFICATION
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7.1 Agreement of Indemnitors to Indemnify.
-------------------------------------
(a) Subject to the terms and conditions of this Article 7,
Premiere agrees to indemnify, defend, and hold harmless the WorldCom
Indemnitees, and each of them, from, against, for and in respect of any and all
Losses asserted against, or paid, suffered or incurred by, a WorldCom Indemnitee
and resulting from, based upon, or arising out of:
(i) the inaccuracy, untruth, incompleteness or breach of
any representation or warranty of any Premiere Company contained in or made
pursuant to this Agreement, any Related Agreement or in any certificate,
Schedule, or Exhibit furnished to WorldCom pursuant hereto or thereto;
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(ii) a breach of or failure to perform any covenant or
agreement of a Premiere Company made in this Agreement or any Related
Agreement; or
(iii) any Third Party Claim of patent infringement, copyright
infringement, contributory infringement or inducing infringement resulting
from the manufacture, use, sale, importation or licensing of the Platform
Services or of any other product or service provided by a Premiere Company
under or in connection with a Related Agreement.
(b) Subject to the terms and conditions of this Article 7,
WorldCom agrees to indemnify, defend, and hold harmless the Premiere
Indemnitees, and each of them, from, against, for and in respect of any and all
Losses asserted against, or paid, suffered or incurred by, a Premiere Indemnitee
and resulting from, based upon, or arising out of:
(i) the inaccuracy, untruth, incompleteness or breach of
any representation or warranty of any WorldCom Company contained in or made
pursuant to this Agreement, any Related Agreement or in any certificate,
Schedule, or Exhibit furnished to Premiere pursuant hereto or thereto;
(ii) a breach of or failure to perform any covenant or
agreement of a WorldCom Company made in this Agreement or any Related
Agreement;
(iii) any Third Party Claim of patent infringement,
copyright infringement, contributory infringement or inducing infringement
resulting from the manufacture, use, sale, importation or licensing of any
product or service provided by WorldCom under or in connection with a
Related Agreement; or
(iv) any Third Party Claim relating to the purchase by
Premiere of the Conetco Receivable except to the extent the same solely
results from, is based upon or arises out of an act or omission of a
Premiere Company.
7.2 Limitations on Indemnification. No Party shall be liable
------------------------------
hereunder for any special, incidental, indirect or consequential damages
of any Indemnitee.
7.3 Procedures for Indemnification.
------------------------------
(a) An Indemnification Claim shall be made by an Indemnitee by
delivery of a written notice to the Indemnitor requesting indemnification and
specifying the basis on which indemnification is sought and the amount of
asserted Losses, if known, and, in the case of a Third Party Claim, containing
(by attachment or otherwise) such other relevant information as such Indemnitee
shall have concerning such Third Party Claim.
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(b) If the Indemnification Claim involves a Third Party Claim the
procedures set forth in Section 7.4 shall be observed by the Indemnitee and the
Indemnitor.
(c) If the Indemnification Claim involves a matter other than a
Third Party Claim, the Indemnitor shall have 30 days to object to such
Indemnification Claim by delivery of a written notice of such objection to such
Indemnitee specifying in reasonable detail the basis for such objection. Failure
to timely so object shall constitute a final and binding acceptance of the
Indemnification Claim by the Indemnitor, and the Indemnification Claim shall be
paid in accordance with subsection (d) hereof. If an objection is timely
interposed by the Indemnitor and the dispute is not resolved by such Indemnitee
and the Indemnitor within 30 days from the date the Indemnitee receives such
objection, such dispute shall be resolved as provided in Article 8.
(d) Upon determination of the amount of an Indemnification Claim,
whether by agreement between the Indemnitor and the Indemnitee or by an
arbitration award or by any other final adjudication, the obligation of the
Indemnitor shall be immediately satisfied through payment to the appropriate
Indemnitee.
7.4 Third Party Claims. The obligations and liabilities of the
------------------
parties hereunder with respect to a Third Party Claim shall be subject to the
following terms and conditions:
(a) The Indemnitee shall give the Indemnitor written notice of a
Third Party Claim promptly after receipt by the Indemnitee of notice thereof,
and the Indemnitor, may undertake the defense, compromise and settlement thereof
by representatives of its own choosing reasonably acceptable to the Indemnitee.
The failure of the Indemnitee to notify the Indemnitor of such claim shall not
relieve the Indemnitor of any liability that it may have with respect to such
claim except to the extent the Indemnitor demonstrates that the defense of such
claim is prejudiced by such failure. The assumption of the defense, compromise
and settlement of any such Third Party Claim by the Indemnitor shall be an
acknowledgment of the obligation of the Indemnitors to indemnify the Indemnitee
with respect to such claim hereunder. If the Indemnitee desires to participate
in, but not control, any such defense, compromise and settlement, it may do so
at its sole cost and expense. If, however, the Indemnitor fails or refuses to
undertake the defense of such Third Party Claim within thirty (30) days after
written notice of such claim has been given to the Indemnitor by the Indemnitee
(or such shorter period if necessary to avoid prejudice to the defense of such
Third Party Claim), the Indemnitee shall have the right to undertake the
defense, compromise and settlement of such claim with counsel of its own
choosing.
(b) No settlement of a Third Party Claim involving the asserted
liability of the Indemnitors under this Article shall be made without the prior
written consent by or on behalf of the Indemnitor which consent shall not be
unreasonably withheld or delayed. If the Indemnitor assumes the defense of such
a Third Party Claim, (i) no compromise or settlement thereof may be effected by
the Indemnitor without the Indemnitee's consent,
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which consent shall not be unreasonably withheld or delayed (it being understood
that such consent must be given if (1) there is no finding or admission of any
violation of Law or any violation of the rights of any person and no effect on
any other claim that may be made by or against the Indemnitee, (2) the sole
relief provided is monetary damages that are paid in full by the Indemnitors,
and (3) the compromise or settlement includes, as an unconditional term thereof,
the giving by the claimant or the plaintiff to the Indemnitee of a release, in
form and substance satisfactory to the Indemnitee, from all liability in respect
of such Third Party Claim), and (ii) the Indemnitee shall have no liability with
respect to any compromise or settlement thereof effected without its consent.
(c) In connection with the defense, compromise or settlement of
any Third Party Claim, the Parties to this Agreement shall permit participation
of counsel selected by any party hereto and, as may reasonably be related to any
such claim or action, shall provide access, without any cost or any unnecessary
burden on any Indemnitee, to the counsel, accountants and other representatives
of each party and during normal business hours, to all relevant properties,
personnel, books, tax records, contracts, commitments and all other relevant
business records of such other party and will furnish to such other party copies
of all such documents as may reasonably be requested (certified, if requested).
7.5 Other Rights and Remedies Not Affected. The representations and
--------------------------------------
warranties and covenants and agreements of the Parties contained herein shall
survive the execution, delivery and performance of this Agreement. The rights of
the Indemnitees under this Article 7 (in their capacity as Indemnitees or in any
other capacity) with respect to breaches of representations, warranties,
covenants and agreements contained in this Agreement and the Related Agreements
are independent of and in addition to such rights and remedies as the
Indemnitees may have at law or in equity or otherwise, including without
limitation the right to seek specific performance, rescission or restitution,
none of which rights or remedies shall be affected or diminished hereby.
7.6 Tax Effect and Insurance. The liability of the Indemnitors with
------------------------
respect to any Indemnification Claim shall be reduced by the tax benefit
actually realized and any insurance proceeds received by the Indemnitees as a
result of any Losses upon which such Indemnification Claim is based, and shall
include any tax detriment actually suffered by the Indemnitees as a result of
such Losses. The amount of any such tax benefit or detriment shall be
determined by taking into account the effect, if any and to the extent
determinable, of timing differences resulting from the acceleration or deferral
of items of gain or loss resulting from such Losses and shall otherwise be
determined so that payment by the Indemnitors of the Indemnification Claim, as
adjusted to give effect to any such tax benefit or detriment, will make the
Indemnitee as economically whole as is reasonably practical with respect to the
Losses upon which the Indemnification Claim is based. Any dispute as to the
amount of such tax benefit or detriment shall be resolved pursuant to the
provisions of Article 8.
- 11 -
<PAGE>
7.7 Subrogation. Upon payment in full of any Indemnification Claim,
-----------
whether such payment is effected by set-off or otherwise, or the payment of any
judgment or settlement with respect to a Third Party Claim, the Indemnitor shall
be subrogated to the extent of such payment to the rights of the Indemnitee
against any person or entity with respect to the subject matter of such
Indemnification Claim or Third Party Claim.
ARTICLE 8
DISPUTE RESOLUTION
------------------
8.1 Informal Dispute Resolution. Prior to the initiation of formal
---------------------------
dispute resolution procedures, the Parties shall first attempt to resolve their
dispute informally, as follows:
(a) The Premiere Representatives and WorldCom Representatives
shall meet for the purpose of endeavoring to resolve such dispute. The
Representatives shall meet as often as the Parties reasonably deem necessary in
order to gather and furnish to the other all information with respect to the
matter in issue which the Parties believe to be appropriate and germane in
connection with its resolution. The Representatives shall discuss the problem
and negotiate in good faith in an effort to resolve the dispute without the
necessity of any formal proceeding. During the course of negotiations, all
reasonable requests made by one Party to another for nonprivileged information,
reasonably related to this Agreement, shall be honored in order that each of the
Parties may be fully advised of the other's position. The specific format for
the discussions shall be left to the discretion of the Representatives, but may
include the preparation of agreed-upon statements of fact or written statements
of position.
(b) If the Representatives conclude in good faith that amicable
resolution through continued negotiation in this form does not appear likely,
the matter will be escalated by formal written notification to a joint panel of
Premiere and WorldCom senior officers. This panel will meet as required to
attempt to resolve the dispute. The number and nature of the senior officers
will depend on the issues in dispute, but will include those senior officers
with authority to resolve all matters in dispute. At either Party's election
this panel will be facilitated by an external facilitator designated by both
Parties.
(c) Formal proceedings for the resolution of a dispute may not be
commenced until the earlier of:
(i) the panel referred to in Subsection 8(b) above
concluding in good faith that amicable resolution through continued
negotiation of the matter does not appear likely; or
(ii) thirty (30) days after the initial request to negotiate
the dispute. This provision shall not be construed to prevent a Party from
instituting,
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<PAGE>
and a Party is authorized to institute, formal proceedings earlier to avoid
the expiration of any applicable limitations period, or to preserve a
superior position with respect to other creditors, or as provided in
Sections 8.5 and 10.2
8.2 Arbitration. If the Parties are unable to resolve any
-----------
controversy arising under this Agreement as contemplated by Section 8.1 and if
such controversy is not subject to Sections 8.3 or 8.5 of this Agreement, then
such controversy shall be submitted to mandatory and binding arbitration at the
election of either Party (the "Disputing Party") pursuant to the following
conditions:
(a) The Disputing Party shall notify the American Arbitration
Association and the other Party in writing describing in reasonable detail the
nature of the dispute (the "Dispute Notice"), and shall request that the
American Arbitration Association furnish a list of five (5) possible arbitrators
who shall have at least five (5) years experience in the matter in dispute.
Each of the Parties will select one of these arbitrators and the Parties shall
jointly select the third arbitrator from the proposed list.
(b) The arbitrators shall allow reasonable discovery in the forms
permitted by the Federal Rules of Civil Procedure, to the extent consistent with
the purpose of the arbitration. The arbitrators shall have no power or
authority to amend or disregard any provision of this Section 8.2. The
arbitration hearing shall be commenced promptly and conducted expeditiously,
with each of the Parties being allocated one-half of the time for the
presentation of its case. Unless otherwise agreed to by the Parties, an
arbitration hearing shall be conducted on consecutive days.
(c) Should one or more of the arbitrators refuse or be unable to
proceed with arbitration proceedings as called for by this Section 8.2, such
arbitrator(s) shall be replaced by an arbitrator(s) by the Party or Parties, as
appropriate, who originally selected such arbitrator(s). If an arbitrator is
replaced pursuant to this paragraph (c), then a rehearing shall take place in
accordance with the provisions of this Section 8.2.
(d) The arbitrators rendering judgment upon disputes between
Parties as provided in this Section 8.2 shall, after reaching judgment and
award, prepare and distribute to the Parties a writing describing the findings
of fact and conclusions of law relevant to such judgment and award and
containing an opinion setting forth the reasons for the giving or denial of any
award. The award of the arbitrator shall be final and binding on the Parties,
and judgment thereon may be entered in a court of competent jurisdiction.
(e) Arbitration hearings hereunder shall be held in Atlanta,
Georgia if WorldCom is the Disputing Party or in Jackson, Mississippi if
Premiere is the Disputing Party. If the Parties agree, arbitration hearings may
be held in another location.
(f) The arbitrators are instructed that time is of the essence in
the arbitration proceeding, and that the arbitrators shall have the right and
authority to issue
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<PAGE>
monetary sanctions against either of the Parties if, upon a showing of good
cause, that Party is unreasonably delaying the proceeding. The arbitrators shall
render their judgment or award within fifteen (15) days following the conclusion
of the hearing. Recognizing the express desire of the Parties for an expeditious
means of dispute resolution, the arbitrators shall limit or allow the Parties to
expand the scope of discovery as may be reasonable under the circumstances.
8.3 Litigation. The Parties agree that all disputes between them
----------
shall be subject to the provisions of Sections 8.1 and 8.2 except as set forth
in Section 8.5, and except where a Party makes a good faith determination that a
breach by the other Party is such that the damages to such Party resulting from
the breach will be so immediate, so large or severe, and so incapable of
adequate redress after the fact that a temporary restraining order or other
immediate injunctive relief is a necessary remedy.
8.4 Continued Performance. Each Party agrees to continue performing
---------------------
its obligations under this Agreement while any dispute is being resolved unless
and until such obligations are terminated by the termination or expiration of
this Agreement.
8.5 Equitable Remedies. The Parties acknowledge that, in the event
------------------
that the other breaches (or attempts or threatens to breach) its obligations
under Section 10.2, or of the obligations of WorldCom under Sections 3.1, 4.7 or
4.8 of the Investment Agreement, the other Party will be irrevocably harmed. In
such circumstance, the non-breaching party may proceed directly to court. If a
court of competent jurisdiction should find that the other party has breached
(or attempted or threatened to breach) any of such obligations, the breaching
Party agrees that it will not oppose the entry of an appropriate order
compelling the performance of such Party in restraining it from further breaches
(or attempted or threatened breaches) on the grounds that the failure to abide
by such obligations will not cause the other Party irreparable harm.
ARTICLE 9
TERM AND TERMINATION
--------------------
9.1 Term. Unless earlier terminated pursuant to the provisions of
----
Section 9.2, the term of this Agreement shall commence on the date hereof and
shall continue until the twenty-fifth (25th) anniversary of such date (the
"Initial Term"), and shall continue thereafter for successive five year terms
(each, a "Renewal Term") unless, no later than 180 days, nor earlier than 360
days, prior to the end of the Initial Term or Renewal Term, as the case may be,
one of the Parties gives notice to the other Party that it desires to terminate
the Agreement.
9.2 Termination. This Agreement may be terminated prior to the end
-----------
of the Initial Term or applicable Renewal Term:
(a) By mutual consent of the Parties;
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<PAGE>
(b) By either Party in the event of a material breach by the
other Party of any material representation, covenant or agreement contained in
this Agreement which has not been cured within 60 days after the receipt of
written notice by the breaching Party of such breach; provided, however, that if
such breach is capable of cure but not within such 60 day period, the Party
asserting the right of termination may not terminate this Agreement if and so
long as the breaching Party has taken steps in good faith during such 60 day
period to cure such breach and thereafter diligently pursues cure to completion;
or
(c) Upon the termination of all Related Agreements by either
Party due to a material breach thereof in accordance with the termination
provisions thereof by the other Party, at the election of the Party terminating
the Platform Services Agreement and all Related Agreements.
9.3 Effect of Termination. In the event of the termination of this
---------------------
Agreement pursuant to Section 9.2, this Agreement shall become void, except that
(a) the provisions of this Section 9.3 and Articles 7 and 10 shall survive any
such termination, (b) a termination pursuant to Section 9.2(b) shall not relieve
the breaching Party from Liability for an uncured breach of this Agreement, and
(c) a termination of this Agreement shall not affect the rights and obligations
of the Parties under any Related Agreement unless so provided therein (which
shall remain in effect and be governed by its terms, until terminated in
accordance therewith).
ARTICLE 10
MISCELLANEOUS
-------------
10.1 Definitions.
-----------
(a) Except as otherwise provided herein, the capitalized terms
set forth below shall have the following meanings:
"Affiliate" of a Person shall mean: (i) any other Person
directly, or indirectly through one or more intermediaries, controlling,
controlled by or under common control with such Person; or (ii) any
executive officer, director, general partner, or direct or indirect
beneficial owner of any 10% or greater equity or voting interest of such
Person or a Subsidiary thereof.
"Aggregate Operating Income" shall mean the sum of all Operating
Income received by any Premiere Company from (a) any Platform Services
Agreement entered into pursuant to Article 3 or pursuant to a Joint
Marketing Agreement entered into pursuant to Article 4 and (b) any Joint
Marketing Agreement entered into pursuant to Article 4. For purposes of
this definition, "Operating Income" shall mean (i) service charges and
other amounts (but not late fees) received by the relevant Premiere Company
under a Platform Services Agreement entered into pursuant to Article 3 or
pursuant to a Joint Marketing
- 15 -
<PAGE>
Agreement entered into pursuant to Article 4, and (ii) all other revenue
allocated to a Premiere Company under a Joint Marketing Agreement,
including any marketing commissions or Premiere's allocation of offering
revenues (not including any service charges or other amounts received by a
Premiere Company and included in the amounts included in the preceding
clause (i)).
"Agreement" shall mean this Strategic Relationship Agreement,
including the Exhibits and Schedules delivered pursuant hereto and
incorporated herein by reference.
"Bankruptcy Exception" shall mean all applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally.
"Conetco" shall mean Conetco Corporation, a New York corporation
d/b/a Communications Network Corporation.
"Conetco Bankruptcy Action" shall mean the action styled In Re
-----
Communications Network Corporation, a/k/a Conetco pending in the United
-------------------------------------------------
States Bankruptcy Court for the Southern District of New York (Case No. 96-
B-43504).
"Conetco Receivable" shall mean the amounts due any WorldCom
Company from the claims asserted against Conetco in the Conetco Bankruptcy
Action and from the claims asserted against the Khatibs in the Khatib
Guaranty Action, or any claim or claims asserted in any other action
arising out of or based on the subject matter of the Conetco Bankruptcy
Action or the Khatib Guaranty.
"Confidentiality Agreements" shall mean the Confidentiality
Agreements of Premiere and WorldCom delivered on September 5, 1996 for the
respective benefit of the other Party.
"EBIS Stock" shall mean the 950 shares of common stock of EBIS
Communications, Inc., a Georgia corporation, owned by WorldCom Network
Services, Inc., a Delaware corporation and wholly owned subsidiary of
WorldCom.
"Enhanced Calling Programs" shall mean (a) all prepaid (or debit)
card programs and other calling card programs offered from time to time by
the WorldCom Companies, and (b) other enhanced calling program, in addition
to calling card programs, offered from time to time by the WorldCom
Companies pursuant to which a caller dials a number and interacts with a
computer based instrument requiring a database lookup, call routing, or
message forwarding, including by way of example and not limitation, 1-800-
PIN programs, various interactive voice applications, and other special
applications involving network based computer telephony, including, but not
limited to, the types of services in development as set forth in the
Premiere Disclosure Memorandum..
- 16 -
<PAGE>
"Exhibits" A through C, inclusive, shall mean the Exhibits so
marked, copies of which are attached to this Agreement. Such Exhibits are
hereby incorporated by reference herein and made a part hereof, and may be
referred to in this Agreement and any other related instrument or document
without being attached hereto.
"GAAP" shall mean generally accepted accounting principles,
consistently applied during the periods involved.
"Indemnification Claim" shall mean a claim for indemnification
under Article 7.
"Indemnitee" shall mean a Premiere Indemnitee or a WorldCom
Indemnitee, as the case may be.
"Indemnitor shall mean Premiere or WorldCom, as the case may be.
"Khatibs" shall mean Wael Al-Khatib, Prudence Al-Khatib and the
other defendants in the Khatib Guaranty Action.
"Khatib Guaranty Action" shall mean the action styled WorldCom
--------
Network Services, Inc. f/k/a Wiltel, Inc. v. Wael-Al-Khatib, et. al.
--------------------------------------------------------------------
pending in the United States District Court for the Southern District of
New York (Civil Action No. 96-4492).
"Law" shall mean any code, law (including common law), ordinance,
regulation, reporting or licensing requirement, rule, or statute applicable
to a Person or its assets, Liabilities, or business, including those
promulgated, interpreted or enforced by any regulatory authority.
"Liability" shall mean any direct or indirect, primary or
secondary, liability, indebtedness, obligation, penalty, cost or expense
(including costs of investigation, collection and defense), claim,
deficiency, guaranty or endorsement of or by any Person (other than
endorsements of notes, bills, checks, and drafts presented for collection
or deposit in the ordinary course of business) of any type, whether
accrued, absolute or contingent, liquidated or unliquidated, matured or
unmatured, or otherwise.
"Lien" shall mean any conditional sale agreement, default of
title, easement, encroachment, encumbrance, hypothecation, infringement,
lien, mortgage, pledge, reservation, restriction, security interest, title
retention or other security arrangement, or any adverse right or interest,
charge, or claim of any nature whatsoever of, on, or with respect to any
property or property interest, other than (i) Liens for current property
taxes not yet due and payable, and
- 17 -
<PAGE>
(iii) Liens which do not materially impair the use of or title to the
assets subject to such Lien.
"Litigation" shall mean any action, arbitration, cause of action,
claim, complaint, criminal prosecution, governmental or other examination
or investigation, hearing, administrative or other proceeding relating to
or affecting a Party, its business, its assets (including contracts related
to it), or the transactions contemplated by this Agreement.
"Losses" shall mean any and all demands, claims, actions or
causes of action, assessments, losses, diminution in value, damages,
liabilities, costs, and expenses, including interest, penalties, cost of
investigation and defense, and reasonable attorneys' and other professional
fees and expenses.
"Material Adverse Effect" on a Party shall mean an event, change
or occurrence which, individually or together with any other event, change
or occurrence, has a material adverse impact on (i) the financial position,
business, results of operations or prospects of such Party and its
Subsidiaries, taken as a whole, or (ii) the ability of such Party to
perform its obligations under this Agreement or to consummate the
Acquisition or the other transactions contemplated by this Agreement,
provided that "Material Adverse Effect" shall not be deemed to include the
impact of (a) changes in Laws of general applicability or interpretations
thereof by courts or governmental authorities, (b) changes in generally
accepted accounting principles or regulatory accounting principles, and (c)
actions and omissions of a Party (or any of its Subsidiaries) taken with
the prior informed written consent of the other Party in contemplation of
the transactions contemplated hereby.
"Material" for purposes of this Agreement shall be determined in
light of the facts and circumstances of the matter in question; provided
that any specific monetary amount stated in this Agreement shall determine
materiality in that instance.
"Net Proceeds" shall mean the difference between (a) the
aggregate amount of cash and fair market value of any property other than
cash received by any WorldCom Company in payment of the Conetco Receivable,
whether those amounts are received from Conetco, the Khatibs or any other
Person, and (b) the amount of expenses, including attorneys' fees,
reasonably incurred by any WorldCom Company in connection with the
collection of the Conetco Receivable.
"Person" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting
in a representative capacity.
- 18 -
<PAGE>
"Platform Services" shall mean the computer telephony platform
services offered by the Premiere Companies as described on Exhibit A of the
Platform Services Agreement attached hereto as Exhibit C, and such other
---------
such services as may be developed and offered from time to time by the
Premiere Companies, including services developed pursuant to this
Agreement.
"Premiere Common Stock" shall mean the $.01 par value common
stock of Premiere.
"Premiere Companies" shall mean, collectively, Premiere and all
Premiere Subsidiaries, whether now existing or hereafter acquired or
formed.
"Premiere Disclosure Memorandum" shall mean the written
information entitled "Premiere Technologies, Inc. Disclosure Memorandum"
delivered on the date of this Agreement to WorldCom describing in
reasonable detail the matters contained therein and, with respect to each
disclosure made therein, specifically referencing each Section of this
Agreement under which such disclosure is being made. Information disclosed
with respect to one Section shall not be deemed to be disclosed for
purposes of any other Section not specifically referenced with respect
thereto.
"Premiere Indemnitees" shall mean any Premiere Company and their
respective officers, directors, agents and other representatives.
"Premiere Representatives" shall mean the representatives of
Premiere on the Strategic Alliance Committee, which shall at a minimum
include D. Gregory Smith so long as he is an employee of any Premiere
Company or until Premiere designates a successor representative.
=======================================================
"Premiere Subsidiaries" shall mean the Subsidiaries of Premiere.
"Related Agreements" shall mean the Investment Agreement, the
Assignment Agreement, the Irrevocable Stock Power, Platform Services
Agreements entered into pursuant to Articles 3 and 4 hereof, and any Joint
Marketing Agreements entered into (including, in each case, any amendments
thereto and replacements or successor agreements thereto).
"Representatives" shall mean the Premiere Representatives and the
WorldCom Representatives.
"SEC Documents" shall mean all forms, proxy statements,
registration statements, reports, schedules, and other documents filed, or
required to be filed, by a Party or any of its Subsidiaries pursuant to the
Securities Laws, together with any amendments thereto.
"Securities Laws" shall mean the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, the Investment
Company Act of
- 19 -
<PAGE>
1940, as amended, the Investment Advisors Act of 1940, as amended, the
Trust Indenture Act of 1939, as amended, and the rules and regulations
promulgated thereunder.
"Strategic Alliance Committee" or "Committee" shall mean the
Committee comprised of the WorldCom Representatives and the Premiere
Representatives to administer various aspects of the strategic alliance
between WorldCom and Premiere as set forth in this Agreement.
"Subsidiaries" shall mean all those corporations, associations,
limited liability companies, partnerships, business trusts or other
business entities of which the entity in question at the time in question
either (i) owns or controls 50% or more of the outstanding equity
securities either directly or through an unbroken chain of entities as to
each of which 50% or more of the outstanding equity securities is owned
directly or indirectly by its parent, (ii) in the case of partnerships,
serves as a general partner, (iii) in the case of a limited liability
company, serves as a managing member, or (iv) otherwise has the ability to
elect a majority of the directors, trustees or managing members thereof.
"Third Party Claim" shall mean any Litigation that is instituted
against an Indemnitee by a person or entity other than an Indemnitor and
which, if prosecuted successfully, would result in a Loss for which the
Indemnitee is entitled to indemnification under Article 7.
"WorldCom Assets" shall mean all right, title and interest of
WorldCom and its Subsidiaries in and to (a) the EBIS Stock and (b) Fifty
Million Dollars ($50,000,000) of the Net Proceeds of the Conetco
Receivable, payable to the extent of fifty percent (50%) of the Net
Proceeds from the Conetco Receivable.
"WorldCom Companies" shall mean, collectively, WorldCom and all
WorldCom Subsidiaries, whether now existing or hereafter acquired or
formed.
"WorldCom Indemnitees" shall mean any WorldCom Company and their
respective officers, directors, agents and other representatives.
"WorldCom Representatives" shall mean the representatives of
WorldCom on the Strategic Alliance Committee, which at a minimum shall
include Frank Grillo so long as he is an employee of any WorldCom
Company or until WorldCom designates a successor representative.
=======================================================
"WorldCom Subsidiaries" shall mean the Subsidiaries of WorldCom.
(b) The terms set forth below shall have the meanings ascribed
thereto in the referenced sections:
Base Month Section 5.1
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<PAGE>
Conflicting Platform Services Agreements Section 3.2
Dispute Notice Section 8.2
Disputing Party Section 8.2
Joint Marketing Agreements Section 4.2
Joint Service Offerings Section 4.1
Late Payment Charge Section 5.2
Monthly Deficiency Payment Section 5.1
Minimum Guarantee Period Section 5.1
Premiere SEC Reports Section 6.1
Special Services Section 3.3
(c) Any singular term in this Agreement shall be deemed to
include the plural, and any plural term the singular. Whenever the words
"include," "includes" or "including" are used in this Agreement, they shall be
deemed followed by the words "without limitation."
10.2 Confidentiality. All information furnished by the Parties in
---------------
contemplation of or pursuant to this Agreement or the Related Agreements shall
be treated as the sole property of the Party providing such information. The
Party receiving the information shall keep confidential all such information and
shall not directly or indirectly use such information for any competing or other
commercial purpose. The obligation to keep confidential and not use such
information shall not apply to (a) any information which (i) the Party receiving
the information was already in possession of prior to disclosure thereof by the
Party furnishing the information, (ii) was then available to the public, or
(iii) became available to the public through no fault of the Party receiving the
information, or (b) discloses pursuant to a legal requirement or in accordance
with an order of a court of competent jurisdiction or regulatory agency and
shall cooperate with the other Party in seeking a protective order or other
appropriate remedy or action; provided that the Party which is subject to such
legal requirement or order shall use its best efforts to give the other Party at
least ten (10) business days' notice thereof. Each Party acknowledges and
agrees that a breach of their respective obligations of this Section 10.2 would
cause the other irreparable harm for which there is no adequate remedy at law
and that accordingly each is entitled to injunctive and other equitable relief
for the enforcement thereof in addition to damages or any other relief available
at law.
10.3 Expenses. Except as may be provided in this Agreement or in a
--------
Related Agreement, each of the Parties shall bear and pay all direct costs and
expenses incurred by it or on its behalf in connection with the transactions
contemplated hereunder.
10.4 Brokers and Finders. Each of the Parties represents and
-------------------
warrants that neither it nor any of its officers, directors, employees, or
Affiliates has employed any broker or finder or incurred any Liability for any
financial advisory fees, investment bankers' fees, brokerage fees, commissions,
or finders' fees in connection with this Agreement or the transactions
contemplated hereby. In the event of a claim by any broker or finder based upon
his or its representing or being retained by or allegedly representing
- 21 -
<PAGE>
or being retained by WorldCom or Premiere, each of WorldCom and Premiere, as the
case may be, agrees to indemnify and hold the other Party harmless of and from
any Liability in respect of any such claim.
10.5 Entire Agreement. Except as otherwise expressly provided
----------------
herein, this Agreement (including the documents and instruments referred to
herein) constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral (except for the
Confidentiality Agreements). Nothing in this Agreement expressed or implied, is
intended to confer upon any Person, other than the Parties, an Indemnitee or
their respective successors or permitted assigns, any rights, remedies,
obligations, or liabilities under or by reason of this Agreement.
10.6 Notices. Any notices or other communications required or
-------
permitted under this Agreement shall be effective only if it is in writing and
delivered personally, by facsimile transmission by nationally recognized next
business day courier, or by registered or certified mail, postage pre-paid,
addressed as follows:
Premiere: Premiere Technologies, Inc.
3399 Peachtree Road, N.E.
The Lenox Building, Suite 400
Atlanta, Georgia 30326
Telecopy No.: (404) 262-8540
Attention: Boland T. Jones
President
and
Patrick G. Jones
Senior Vice President of Finance and
Legal
Copy to Counsel: Alston & Bird
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Telecopy No.: (404) 881-7777
Attention: Jeffrey A. Allred, Esq.
WorldCom: WorldCom, Inc.
515 East Amite Street
Jackson, Mississippi 39201-2702
Telecopy No.: (601) 360-8190
Attention: David F. Myers
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<PAGE>
Copy to Counsel: P. Bruce Borghardt
WorldCom, Inc.
10777 Sunset Office Drive, Suite 330
St. Louis, Missouri 63127
Telecopy No.: (314) 909-4101
or such other address as shall be furnished in writing by any of the Parties.
Any such notice or communication shall be deemed to have been given as of the
date so personally delivered, sent by courier or facsimile or mailed.
10.7 Amendments. This Agreement may be amended by a subsequent
----------
writing signed by both Parties upon the approval of each of the Parties.
10.8 Counterparts; Facsimile. This Agreement may be executed in two
-----------------------
or more counterparts all of which shall be one and the same Agreement and shall
become effective when one or more counterparts have been signed by each Party
and delivered to the other Party. Delivery of a signature page by facsimile
transmission shall be deemed to be legally sufficient execution and delivery of
the page and the agreement or instrument for which it relates.
10.9 Headings. The headings in this Agreement are for convenience
--------
only and shall not affect the construction or interpretation of this Agreement.
10.10 Successors and Assigns. All terms and conditions of this
----------------------
Agreement shall be binding upon and inure to the benefit of and be enforceable
by any successor to WorldCom and any successor to Premiere. Except as otherwise
provided in this Section 10.10, any assignment of the rights and obligations of
the Parties under this Agreement shall be effective upon a written agreement
signed by all the Parties.
10.11 Severability. If any provision of this Agreement shall be held
------------
to be illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein. If any provision
of this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
10.12 Interpretations. The Parties acknowledge and agree that this
---------------
Agreement has been reviewed, negotiated and accepted by all Parties and their
attorneys and shall be construed and interpreted according to the ordinary
meaning of the words used so as fairly to accomplish the purposes and intentions
of all Parties hereto.
10.13 Attorneys' Fees. In the event of any action to enforce this
---------------
Agreement, the prevailing Party shall be entitled to reimbursement from the
other Party of all costs and
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<PAGE>
expenses incurred in connection with such effort, including court costs and
reasonable attorneys' fees.
10.14 Relationship of the Parties. Each of the Parties acknowledge
---------------------------
that they are acting as independent contractors, and each Party has the sole
right and obligation to supervise, manage, contract, direct, procure, perform or
cause to be performed, all work or other obligations to be performed by such
Party under this Agreement. Neither Party is an agent of the other Party, nor
has the authority to represent or otherwise bind the other Party as to any
matters.
10.15 Publicity. All media releases, public announcements and public
---------
disclosure by either Party related to this Agreement or the subject matter of
this Agreement, including, without limitation, promotional or marketing
material, shall be coordinated and approved by the other Party prior to release;
provided that nothing herein shall preclude a Party from complying with its
obligations under applicable Law. Notwithstanding the foregoing, Premiere may
list WorldCom as a customer in proposals and other marketing materials.
10.16 Service Marks. Except as set forth in Section 10.15, each Party
-------------
agrees that it shall not, without the other Party's prior written consent, use
the name, service marks or trademarks of the other Party.
10.17 Covenant of Good Faith. Each Party agrees that, in its
----------------------
respective dealings with the other Party under or in connection with this
Agreement, it shall act in good faith.
10.18 Force Majeure. Each Party shall be excused from performance
-------------
under this Agreement and shall have no liability to the other Party for any
period it is prevented from performing any of its obligations (other than
payment obligations), in whole or in part, as a result of delays caused by the
other Party or by an act of God, war, civil disturbance, court order, labor
dispute, third party performance or nonperformance, or other cause beyond its
reasonable control, including failures or fluctuations in electrical power, heat
or light and such nonperformance shall not be a default under, or grounds for
termination of, this Agreement or, to the extent provided therein, any Related
Agreement.
10.19 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Georgia.
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<PAGE>
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
duly executed and delivered as of the date above written.
PREMIERE TECHNOLOGIES, INC.
By: /s/ Patrick G. Jones
--------------------------------
Name: Patrick G. Jones
------------------------
Title: Senior Vice President Finance and Legal
---------------------------------------
WORLDCOM, INC.
By: /s/ David F. Myers
--------------------------------
Name: David F. Myers
------------------------
Title: Treasurer
-----------------------
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