<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
--------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period from to
--------------- --------------
Commission file number 0-26140
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HIGHWAYMASTER COMMUNICATIONS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 51-0352879
- ----------------------------------- --------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1155 Kas Drive, Suite 100, Richardson, Texas 75081
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (972) 301-2000
--------------
Not Applicable
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
Number of Shares Outstanding as of
Title of each class May 11, 1999
- ---------------------------- ----------------------------------
Common Stock, $.01 par value 24,985,860
<PAGE> 2
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
Form 10-Q
INDEX
<TABLE>
<CAPTION>
PAGE
NUMBER
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1 Consolidated Financial Statements:
Consolidated Balance Sheets at March 31, 1999
and December 31, 1998 1
Consolidated Statements of Operations for the
three months ended March 31, 1999 and 1998 2
Consolidated Statements of Cash Flows for the three
months ended March 31, 1999 and 1998 3
Consolidated Statement of Changes in Stockholders' Equity
(Deficit) for the three months ended March 31,1999 4
Notes to Consolidated Financial Statements 5-6
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-8
Item 3 Quantitative and Qualitative Disclosures About
Market Risk 8
PART II. OTHER INFORMATION
Item 1 Legal Proceedings 9
Item 2 Changes in Securities 9
Item 3 Defaults Upon Senior Securities 9
Item 4 Submission of Matters to a Vote of Security Holders 9
Item 5 Other Information 9
Item 6 Exhibits and Reports on Form 8-K 10
Signatures 11
</TABLE>
<PAGE> 3
PART I - FINANCIAL INFORMATION
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands)
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
--------- ---------
<S> <C> <C>
Current assets:
Cash and short-term investments $ 23,061 $ 26,169
Accounts receivable, net 14,525 14,585
Inventory 14,536 12,921
Pledged securities - current portion 12,974 12,974
Other current assets 9,004 714
--------- ---------
Total current assets 74,100 67,363
Network, equipment and software, net 21,130 20,649
Pledged securities - long-term portion 5,748 11,814
Other assets, net 3,338 3,300
--------- ---------
Total assets $ 104,316 $ 103,126
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $ 2,808 $ 11,362
Telecommunications costs payable 4,977 5,920
Accrued interest payable 541 3,784
Advance payments from customers 19,061 7,452
Other current liabilities 11,453 9,702
--------- ---------
Total current liabilities 38,840 38,220
Senior notes payable 91,795 91,697
--------- ---------
Total liabilities 130,635 129,917
--------- ---------
Stockholders' equity (deficit):
Preferred Stock -- --
Common Stock 253 252
Additional paid-in capital 149,562 149,481
Accumulated deficit (175,587) (175,977)
Treasury stock (547) (547)
--------- ---------
Total stockholders' equity (deficit) (26,319) (26,791)
Commitments and contingencies
--------- ---------
Total liabilities and stockholders' equity (deficit) $ 104,316 $ 103,126
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
1
<PAGE> 4
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share)
<TABLE>
Three months ended
March 31,
1999 1998
-------- --------
<S> <C> <C>
Revenues:
Product $ 4,340 $ 4,627
Service 12,741 11,096
-------- --------
Total revenues 17,081 15,723
-------- --------
Cost of revenues:
Product 3,144 3,747
Service (Note 5) 3,277 8,715
-------- --------
Total cost of revenues 6,421 12,462
-------- --------
Gross profit 10,660 3,261
-------- --------
Expenses:
General and administrative 3,389 3,334
Customer service 1,818 3,364
Sales and marketing 914 2,179
Engineering 647 1,409
Network services center 419 397
Depreciation and amortization 1,624 1,069
-------- --------
8,811 11,752
-------- --------
Operating income (loss) 1,849 (8,491)
Interest income 918 1,342
Interest expense (3,342) (4,440)
Other income (Note 5) 965 --
-------- --------
Income (loss) before income taxes 390 (11,589)
Income tax provision -- --
-------- --------
Net income (loss) $ 390 $(11,589)
======== ========
Per share:
Basic and diluted income (loss) $ 0.02 $ (0.47)
======== ========
Weighted average number of shares outstanding
Basic 24,993 24,899
======== ========
Diluted 25,444 24,899
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 5
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>
Three months ended
March 31,
----------------------
1999 1998
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 390 $(11,589)
Adjustments to reconcile net loss to cash used in
operating activities:
Depreciation and amortization 1,624 1,069
Amortization of discount on notes payable 98 130
(Increase) decrease in accounts receivable 60 (493)
(Increase) in inventory (1,615) (1,755)
Increase (decrease) in accounts payable (8,554) 266
Increase (decrease) in accrued expenses and other
current liabilities 9,175 (2,634)
Other (8,426) 133
-------- --------
Net cash used in operating actitivies (7,248) (14,873)
-------- --------
Cash flows from investing actitivies:
Additions to network and equipment (1,831) (1,928)
Additions to capitalized software (177) (282)
Decrease in pledged securities 6,066 7,593
Decrease in temporary investments -- 3,261
Decrease in short-term investments 2,457 1,414
-------- --------
Net cash provided by investing activitie 6,515 10,058
-------- --------
Cash flows from financing activities:
Proceeds from exercise of stock options 82 --
-------- --------
Net cash provided by financing activities 82 --
-------- --------
(Decrease) in cash and cash equivalents (651) (4,815)
Cash and cash equivalents, beginning of year 16,461 26,777
-------- --------
Cash and cash equivalents, end of year 15,810 21,962
Short-term investments 7,251 18,295
-------- --------
Cash and short-term investments $ 23,061 $ 40,257
======== ========
Supplemental cash flow information:
Interest paid $ 6,487 $ 8,212
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 6
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
(UNAUDITED)
(in thousands, except share information)
<TABLE>
<CAPTION>
Preferred Stock Common Stock Additional
--------------- ------------------- Paid-in
Shares Amount Shares Amount Capital
----- ------ ---------- ----- ---------
<S> <C> <C> <C> <C> <C>
Stockholders' equity (deficit) at December 31, 1998 1,000 $ -- 25,210,983 $ 252 $ 149,481
Exercise of stock options 68,974 1 81
Net income
----- ------ ---------- ----- ---------
Stockholders' equity (deficit) at March 31, 1999 1,000 $ -- 25,279,957 $ 253 $ 149,562
===== ====== ========== ===== =========
<CAPTION>
Treasury Stock
---------------- Accumulated
Shares Amount Deficit Total
------- ------ ---------- --------
<S> <C> <C> <C> <C>
Stockholders' equity (deficit) at December 31, 1998 311,997 $(547) $ (175,977) $(26,791)
Exercise of stock options 82
Net income 390 390
------- ----- ---------- --------
Stockholders' equity (deficit) at March 31, 1999 311,997 $(547) $ (175,587) $(26,319)
======= ===== ========== ========
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 7
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
Notes To Consolidated Financial Statements
(Unaudited)
1. BUSINESS OVERVIEW
The Company develops and implements mobile communications
solutions, including integrated voice, data and position location
services, to meet the needs of its customers. The initial application
for the Company's wireless enhanced services has been developed for,
and is marketed and sold to, companies which operate in the long-haul
trucking market. The Company provides long-haul trucking companies with
a comprehensive package of mobile communications and management control
services at a fixed rate per minute, thereby enabling its trucking
customers to effectively monitor the operations and improve the
performance of their fleets. During the third quarter of 1998, the
Company began delivery of mobile communication units ("mobile units")
for use in a service vehicle application. The Company is currently
developing additional applications for its network to expand the range
of its commercial dispatch and tracking services to broader lines of
business.
The Company's revenues are derived primarily from the sales
and installation of mobile units and charges for its services.
2. BASIS OF PRESENTATION
The unaudited consolidated financial statements presented
herein have been prepared in accordance with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
all footnote disclosures required by generally accepted accounting
principles. These consolidated financial statements should be read in
conjunction with the Company's audited consolidated financial
statements for the year ended December 31, 1998. The accompanying
consolidated financial statements reflect all adjustments (all of which
are of a normal recurring nature except as described in Note 5) which
are, in the opinion of management, necessary for a fair presentation of
the Company's financial position, results of operations and cash flows
for the interim periods. The results for any interim period are not
necessarily indicative of the results for the entire year.
3. EARNINGS PER SHARE
Basic earnings per share for the three months ended March 31,
1998 and 1999 is computed using the weighted average number of shares
outstanding during the respective periods. Diluted earnings per share
for the three months ended March 31, 1999 is computed using the
weighted average shares from the basic calculation plus the number of
additional shares that would have been issued from the exercise of in
the money stock options, net of the shares that would be able to be
repurchased from the stock option proceeds (the "treasury stock
method"). The calculation of basic and diluted earnings per share is
identical for the three months ended March 31, 1998.
4. INVENTORIES
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
------------ ------------
<S> <C> <C>
Complete systems $ 188,000 $ 1,577,000
Component parts 586,000 826,000
Equipment shipped not yet accepted 13,762,000 10,518,000
------------ ------------
$ 14,536,000 $ 12,921,000
============ ============
</TABLE>
5
<PAGE> 8
5. UNUSUAL ITEMS
During the three months ended March 31, 1999 the Company
recorded the benefit of credits due from cellular carriers related to
1997 and 1998 based on a settlement agreement reached with GTE
Wireless, Inc. and GTE Telecommunications Incorporated on May 3, 1999.
These credits had not been previously recognized because of significant
uncertainty as to their ultimate collectibility. The effect of these
credits was to increase income by $3,724,000, of which $3,580,000 is
reflected as a reduction in "cost of service revenue" in the
accompanying Consolidated Statements of Operations.
Also, during the three months ended March 31, 1999, the
Company recorded the benefit from the settlement of the litigation with
AT&T Corp. The proceeds of this settlement, net of related expenses,
are reflected as "other income" in the accompanying Consolidated
Statements of Operations.
The increases in "other current assets" and "other accrued
liabilities" at March 31, 1999, in the accompanying Consolidated
Balance Sheets, are primarily due to accruals related to the above
items.
6
<PAGE> 9
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
Three Months Ended March 31, 1999 Compared to Three Months Ended March
31, 1998
Total revenues increased 8.6% to $17.1 million in 1999 from $15.7
million in 1998. Product revenues decreased 6.2% from $4.6 million in 1998 to
$4.3 million in 1999. The Company continued shipping mobile units in connection
with a major contract received during 1998 for a service vehicle application.
However, the 3,706 mobile units shipped and placed in service during the first
quarter in connection with this contract are not reflected in product revenues
because the earning process was not complete at March 31, 1999. Service revenues
increased 14.8% to $12.7 million in 1999 as compared to $11.1 million in 1998
due to the increased installed base of mobile units. The installed base of
mobile units increased 47.4% to 52,263 mobile units at March 31, 1999 from
35,454 mobile units at March 31, 1998. Average monthly revenue per mobile unit
decreased 21.1% to $82.57 in 1999 from $104.64 in 1998. This decrease is caused
by (i) the decision in the second quarter of 1998 to cancel the personal calling
accounts promotion and strengthen credit policies related to personal calling
accounts, thereby reducing personal calling revenues, and (ii) the increasing
proportion of service vehicles in the installed base. Average revenue for
service vehicles is less than that of long-haul trucking because of different
product functionality.
Product gross profit margin was 27.6% in 1999 compared to 19.0% in
1998. The improvement in product gross profit margin is primarily attributable
to an increase in the average sales price per mobile unit combined with a
decrease in the average cost per mobile unit sold. Variations in the average
sales price per mobile unit occur as a result of product mix and tier pricing.
The lower average cost per mobile unit is attributable to lower costs as a
result of completing the transition to a new manufacturer effective April
1,1998.
Service gross profit margin was 74.3% in 1999 compared to 21.5% in
1998. As more fully described in Note 5 to the accompanying consolidated
financial statements, during 1999 the Company recorded $3.6 million of credits
due from cellular carriers related to prior years. Excluding the effect of these
credits, service gross profit margin would have been 46.2%. The increase in
service margin from 21.5% to 46.2% is primarily as a result of (i) the
additional access fees generated by the 45.7% increase in the average installed
base of mobile units from the first quarter of 1998 to the first quarter of
1999, (ii) the effect of a new lower cost contract with one of the Company's
major vendors that was retroactively effective in the first quarter of 1999 and
(iii) the effect of technical adjustments and modifications implemented to
reduce the amount of airtime costs incurred that are not billable to customers.
Operating expenses decreased 25.0% to $8.8 million in 1999 from $11.8
million in 1998. This decrease is primarily as a result of the restructuring
decisions made in the second and third quarters of 1998. The average number of
employees decreased 35.0% from the first quarter of 1998 to the first quarter of
1999. Sales and marketing expense and engineering expense decreased
significantly because the first quarter of 1998 included significant advertising
and development costs associated with products that were discontinued in the
third quarter of 1998. General and administrative expense decreased
significantly, but the decreases were offset by an increase in bad debt expense
of approximately $0.4 million. The Company records bad debt expense as a percent
of sales. The increase in bad debt expense is due to the increase in sales from
1998 to 1999 and due to an increase in the percentage rate used for the
calculation of the bad debt provision based on experience gained during 1998.
Interest income was $0.9 million in 1999 compared to $1.3 million in
1998. Interest expense was $3.3 million in 1999 compared to $4.4 in 1998. The
change in these relationships reflects the lower average outstanding balances
during 1999 in cash and short-term investments and Senior Notes payable.
Other income reflects the proceeds from the settlement of the
litigation with AT&T Corp., net of related costs.
7
<PAGE> 10
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash and short-term investments balances decreased $3.1
million from $26.2 million at December 31, 1998 to $23.1 million at March 31,
1999. The Company's first quarter 1999 operating results, excluding unusual
items, are in line with the Company's expectations as a result of the
restructuring. However, essential to the Company's viability is the successful
completion of the major contract under which the Company has installed 12,392
mobile units from contract inception through March 31, 1999. Should this
contract not be successfully completed, the Company may be required to refund
the $19.1 million of advance payments received on this contract as reflected in
the accompanying Consolidated Balance Sheet. Management expects this contract
will be successfully completed during 1999. Based on the Company's projected
operating results, the Company believes its existing capital resources will be
sufficient to fund its currently anticipated operating needs and capital
expenditure requirements for the next twelve months. However, the Company's
future cash flow from operations and operating requirements may vary depending
on a number of factors in addition to the successful completion of the above
referenced contract, including the rate of installation of mobile units, the
level of competition, success of new products, general economic conditions and
other factors beyond the Company's control.
The Company's capital resources may be insufficient to fund its
operating needs, capital expenditures and debt service requirements in the
long-term. The Company believes that, in order to address its long-term capital
requirements, it will need to take steps to (i) increase the installed base of
mobile units in service and improve the efficiency of its operations, so as to
reduce or eliminate its operating losses, or (ii) obtain additional sources of
debt or equity financing. The Company's ability to obtain additional debt
financing is materially restricted under the terms of the Indenture governing
the Senior Notes. There can be no assurance that the Company would be able to
obtain additional debt and equity financing on satisfactory terms, if at all.
FORWARD LOOKING STATEMENTS
This report includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical fact included in this report, including without
limitation, certain statements in this Item 2 under the captions "---Results of
Operations" and "---Liquidity and Capital Resources," may constitute forward
looking statements. Although the Company believes that the expectations
reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to be correct. There can be no
assurances that the Company will be able to continue to maintain or increase
gross service margins and revenues, reduce operating costs or achieve sustained
operational profitability. Important factors that could cause actual results to
differ materially from the Company's expectations ("cautionary statements") are
disclosed in this report and the Company's Annual Report on Form 10-K for the
year ended December 31, 1998 (under the caption "Business --- Risk Factors" and
elsewhere). All subsequent written and oral forward-looking statements
attributable to the Company or persons acting on its behalf are expressly
qualified in their entirety by these cautionary statements.
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company does not have any material exposure to market risk
associated with its cash and short-term investments. The Company's Senior Notes
payable are at a fixed rate and, thus, are not exposed to interest rate risk.
8
<PAGE> 11
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
PART II - OTHER INFORMATION
Item 1. Legal Proceedings --
AT&T Litigation. As previously reported, on February 16, 1996, the
Company filed a lawsuit in the U.S. District Court, Northern District
of Texas, Dallas Division against AT&T Corp. ("AT&T") and Lucent
Technologies, Inc. ("Lucent") alleging, among other things, trade
secret misappropriation, patent infringement and breach of contract.
The Company, AT&T and Lucent are in the process of formalizing the
settlement agreements and dismissing the lawsuit.
Aeris Litigation. On February 23, 1999, Aeris Communications, Inc.
filed an Original Complaint against the Company in the United States
District Court for the Northern District of California alleging that
the certain of the Company's products may infringe Aeris' United States
Patent No. 5,594,740. Aeris has not served the lawsuit pursuant to a
standstill agreement reached between the parties. The parties are
currently in negotiations in an effort to resolve the disputes.
However, there can be no assurance that the Company will be able to
resolve these disputes. If it were determined that any of the Company's
products infringed a valid patent held by Aeris, the Company may be
required to cease marketing of such products, to obtain licenses (which
might require the payment of past and future royalties) from Aeris or
to redesign such products to avoid infringement. There can be no
assurance that the Company would be able to obtain licenses on
commercially reasonable terms, or that it would be able to design and
incorporate alternative technologies, without a material adverse effect
on the Company and its business, financial condition and results of
operations. Reference is made to the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1998 for additional
information regarding this lawsuit.
Item 2. Changes in Securities -- None.
Item 3. Defaults Upon Senior Securities -- None.
Item 4. Submission of Matters to a Vote of Security Holders -- None
Item 5. Other Information -
GTE Wireless, Inc. ("GTE Wireless") and GTE Telecommunications
Incorporated (GTE- TSI"). As reported in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1998, a dispute had
arisen between GTE Wireless, GTE-TSI and the Company related to the
execution of a Transition Agreement and certain intellectual property
provisions in the Fleet-on-Track Service Agreement.
On May 3, 1999, GTE-TSI, GTE Wireless and the Company reached
a global resolution of all contractual and intellectual property
disputes between the companies. As part of the resolution, on May 3,
1999, GTE-TSI and the Company executed a new Fleet-on-Track Service
Agreement with reduced service fee pricing. In exchange for a release
and covenant not to sue, GTE Wireless paid the Company credits due from
cellular carriers for improperly billed cellular calls, and GTE-TSI
discharged certain service fees owed by the Company to GTE-TSI.
Additionally, GTE Wireless provided the Company with a release of and
covenant not to sue over certain alleged claims arising out of the GTE
Wireless service agreement. Finally, the Company granted to GTE-TSI a
fully paid-up, royalty free, non-exclusive license to certain patents
and patents pending owned by the Company. Furthermore, GTE Wireless and
the Company executed a Transition Agreement wherein GTE Wireless will
continue to provide the services until the earlier of September 30,
1999 or the date that the Company actually transitions to Southwestern
Bell Mobile Systems, Inc. ("SBMS"), its new administrative carrier.
9
<PAGE> 12
There can be no assurances that the Company will be able to
transition to SBMS without incident and the failure to transition to
SBMS without incident may have a material adverse effect on the
Company's business, financial condition or results of operations.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - See the Index to Exhibits.
(b) Reports on Form 8-K - None
10
<PAGE> 13
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 thereunto duly authorized.
HIGHWAYMASTER COMMUNICATIONS, INC.
Date: May 12, 1999
By: /s/ Jana Ahlfinger Bell
-------------------------------------
Jana Ahlfinger Bell
President and Chief Executive Officer
By: /s/ W. Michael Smith
-------------------------------------
W. Michael Smith
Executive Vice President and Chief
Financial Officer (Principal
Financial Officer)
11
<PAGE> 14
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER TITLE
------- -----
<S> <C>
3.1 - Certificate of Incorporation of the Company, as amended.(1)(9)
3.2 - Amended and Restated By-Laws of the Company.(13)
4.1 - Specimen of certificate representing Common Stock, $.01 par value,
of the Company.(1)
4.2 - Warrant Certificate, dated September 27, 1996, issued to SBW.(7)
4.3 - Recapitalization Agreement, dated September 27, 1996, by and among
the Company, the Erin Mills Stockholders, the Carlyle Stockholders
and the other persons named therein.(7)
4.4 - Amended and Restated Stockholders' Agreement, dated September 27,
1996, by and among the Company, SBW, the Erin Mills Stockholders,
the Carlyle Stockholders, the By-Word Stockholders and the other
persons named therein.(7)
4.5 - Indenture dated September 23, 1997 by and among the Company,
HighwayMaster Corporation and Texas Commerce Bank, National
Association.(12)
4.6 - Pledge Agreement dated September 23, 1997 by and among the Company,
Bear, Stearns & Co. Inc. and Smith Barney Inc.(12)
4.7 - Registration Rights Agreement dated September 23, 1997 by and among
the Company, HighwayMaster Corporation, Bear, Stearns & Co. Inc. and
Smith Barney Inc.(12)
4.8 - Warrant Agreement dated September 23, 1997 by and among the Company,
Bear, Stearns & Co. Inc. and Smith Barney Inc.(12)
4.9 - Warrant Registration Rights Agreement dated September 23, 1997 by
and among the Company, Bear, Stearns & Co. Inc. and Smith Barney,
Inc.(12)
10.1 - License Agreement, dated April 23, 1992, by and between Voice
Control Systems and the Company (as successor to By-Word
Technologies, Inc.)(1)
10.2 - Second Amendment to Employment Agreement, dated September 1, 1998,
by and between HighwayMaster Corporation and William C. Saunders.
(16)
10.3 - Agreement and General Release, dated September 30, 1998, by and
between HighwayMaster Corporation and William C. Kennedy, Jr.(15)
10.4 - Release of HighwayMaster Communications, Inc. and HighwayMaster
Corporation by William C. Saunders, dated December 15, 1998. (16)
10.5 - Release of William C. Saunders by HighwayMaster Communications, Inc.
and HighwayMaster Corporation, dated December 15, 1998. (16)
10.6 - Amended and Restated 1994 Stock Option Plan of the Company, dated
February 4, 1994, as amended.(1)(5)(6)
10.7 - Purchase Agreement, dated September 27, 1996, between the Company
and SBW.(7)
10.8 - Mobile Communications (Voice and Data) Services Agreement, dated as
of July 15, 1993, between the Company and EDS Personal
Communications Corporation.(1)(2)
10.9 - Stock Option Agreement, dated June 22, 1998, by and between the
Company and John Stupka. (16)
10.10 - Services Agreement, dated March 20, 1996, between the Company and
GTE-Mobile Communications Service Corporation.(3)(4)
10.11 - Acknowledgment by William C. Saunders dated December 15, 1998. (16)
10.12 - Amendment dated November 16, 1995 to that certain Mobile
Communications (Voice and Data) Services Agreement, dated as of
July 15, 1993, between the Company and EDS Personal Communications
Corporation.(3)(4)
10.13 - Mutual Separation and Release, dated December 22, 1998, by and
between HighwayMaster Corporation and Gordon D. Quick. (16)
10.14 - Product Development Agreement, dated December 21, 1995, between the
Company and IEX Corporation.(3)(4)
</TABLE>
<PAGE> 15
<TABLE>
<S> <C>
10.15 - Technical Services Agreement, dated September 27, 1996, between the
HighwayMaster Corporation and SBW.(7)
10.16 - Letter Agreement, dated February 19, 1996, between the Company and
IEX Corporation.(3)
10.17 - Form of Adoption Agreement, Regional Prototype Cash or Deferred
Profit-Sharing Plan and Trust Sponsored by McKay Hochman Co., Inc.,
relating to the HighwayMaster Corporation 401(k) Plan. (1)
10.18 - February 27, 1997 Addendum to Original Employment Letter dated
September 19, 1997 by and between the HighwayMaster Corporation and
Robert LaMere. (16)
10.19 - Software Transfer Agreement, dated April 25, 1997 between the
Company and Burlington Motor Carriers, Inc.(9)(10)
10.20 - Employment Agreement, dated June 3, 1998, by and between
HighwayMaster Corporation and Todd A. Felker. (16)
10.21 - Employment Agreement, dated June 3, 1998, by and between
HighwayMaster Corporation and William McCausland.(16)
10.22 - Employment Agreement, dated May 29, 1998, by and between
HighwayMaster Corporation and Jana Ahlfinger Bell. (14)
10.23 - Lease Agreement, dated March 20, 1998, between HighwayMaster
Corporation and Cardinal Collins Tech Center, Inc.(15)
10.24 - First Amendment to Employment Agreement, dated September 15, 1998,
by and between HighwayMaster Corporation and Jana A. Bell. (16)
10.25 - Employment Agreement, dated November 24, 1998, by and between
HighwayMaster Corporation and Michael Smith. (16)
10.26 - September 18, 1998 Amended and Restated Stock Option Agreement of
May 29, 1998, by and between the Company and Jana Ahlfinger Bell.
(16)
10.27 - Stock Option Agreement, dated August 12, 1998, by and between the
Company and Jana Ahlfinger Bell. (16)
10.28 - Stock Option Agreement, dated September 18, 1998, by and between
the Company and Jana Ahlfinger Bell. (16)
10.29 - September 18, 1998 Amended and Restated Stock Option Agreement of
February 29, 1996, by and between the Company and William H.
McCausland. (16)
10.30 - Stock Option Agreement, dated September 18, 1998, by and between
the Company and William H. McCausland. (16)
10.31 - September 18, 1998 Amended and Restated Stock Option Agreement of
April 25, 1997, by and between the Company and Robert LaMere. (16)
10.32 - September 18, 1998 Amended and Restated Stock Option Agreement of
June 3, 1998, by and between the Company and Todd A. Felker (16)
10.33 - Stock Option Agreement of November 24, 1998, by and between the
Company and Michael Smith. (16)
10.34 - Stock Option Agreement, dated April 4, 1995, by and between the
Company and Terry Parker. (16)
10.35 - Agreement No. 980427 between Southwestern Bell Telephone Company,
Pacific Bell, Nevada Bell, Southern New England Telephone and
HighwayMaster Corporation executed on January 13, 1999 (17)(18)
10.36 - Administrative Carrier Agreement entered into between HighwayMaster
and Southwestern Bell Mobile Systems, Inc. on March 30, 1999 (17)(18)
10.37 - Addendum to Agreement entered into between HighwayMaster and
International Telecommunication Data Systems, Inc. on February 4,
1999 (17)(18)
10.38 - Second Addendum to Agreement entered into between HighwayMaster and
International Telecommunication Data Systems, Inc. on February 4,
1999 (17)(18)
10.39 - Manufacturing and Equipment Purchase Agreement entered into between
HighwayMaster and Wireless Link Corporation on March 9, 1999 (17)(18)
10.40 - Agreement entered into between HighwayMaster and Cellemetry LLC on
January 19, 1999 (17)(18)
10.41 - Agreement entered into between HighwayMaster and Cellemetry LLC on
January 19, 1999 (17)(18)
</TABLE>
<PAGE> 16
<TABLE>
<S> <C>
10.42 - Agreement entered into between HighwayMaster and Cellemetry LLC on
January 19, 1999 (17)(18)
10.43 - Agreement entered into between HighwayMaster and Cellemetry LLC on
January 7, 1999 (17)(18)
11 - Statement re Computation of Per Share Earnings (18)
27 - Financial Data Schedule (18)
</TABLE>
- ---------
(1) Filed in connection with the Company's Registration Statement on Form S-1,
as amended (No. 33-91486) effective June 22, 1995.
(2) Certain confidential portions deleted pursuant to Order Granting
Application for Confidential Treatment issued in connection with
Registration Statement on Form S-1 (No. 33-91486) effective June 22, 1995.
(3) Filed in connection with the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995.
(4) Certain confidential portions deleted pursuant to Application for
Confidential Treatment filed in connection with the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 1995.
(5) Indicates management or compensatory plan or arrangement required to be
identified pursuant to Item 14(a)(4).
(6) Filed in connection with the Company's Form 10-Q Quarterly Report for the
quarterly period ended June 30, 1996.
(7) Filed in connection with the Company's Current Report on Form 8-K filed on
October 7, 1996.
(8) Filed in connection with the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996.
(9) Filed in connection with the Company's Form 10-Q Quarterly Report for the
quarterly period ended March 31, 1997.
(10) Certain confidential portions deleted pursuant to Order Granting
Application for Confidential Treatment issued in connection with the
Company's Form 10-Q Quarterly Report for the quarterly period ended March
31, 1997.
(11) Filed in connection with the Company's Form 10-Q Quarterly Report for the
quarterly period ended June 30, 1997.
(12) Filed in connection with the Company's Registration Statement on Form S-4,
as amended (No. 333-38361).
(13) Filed in connection with the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997.
(14) Filed in connection with the Company's Form 10-Q Quarterly Report for the
quarterly period ended June 30, 1998.
(15) Filed in connection with the Company's Form 10-Q Quarterly Report for the
quarterly period ended September 30, 1998.
(16) Filed in connection with the Company's Form 10-K fiscal year ended December
31, 1998.
(17) Certain confidential portions deleted pursuant to Application for
Confidential Treatment filed on even date herewith.
(18) Filed herewith.
<PAGE> 1
EXHIBIT 10.35
AGREEMENT NO. 980427 BETWEEN
SOUTHWESTERN BELL TELEPHONE COMPANY
PACIFIC BELL
NEVADA BELL
SOUTHERN NEW ENGLAND TELEPHONE
AND
HIGHWAYMASTER CORPORATION
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 2
Agreement No. 980427
INDEX
Page 1 of 85
INDEX
<TABLE>
<S> <C>
SECTION A - TERMS & CONDITIONS APPLICABLE TO ENTIRE AGREEMENT
PREAMBLE 8
SCOPE OF AGREEMENT 8
DEFINITIONS 9
1. ACCEPTANCE DATE 9
2. ACCEPTANCE PERIOD 9
3. ACCEPTANCE TEST 10
4. DELIVERY DATE 10
5. DOCUMENTATION 10
6. DOWNTIME 10
7. EFFECTIVE DATE 10
8. ENTERPRISE LICENSE 10
9. FIELD ENGINEER 11
10. GPS MATERIAL 11
11. INSTALLATION ACCEPTANCE 12
12. INSTALLATION DATE 13
13. INSTALLATION SITE 13
14. INTELLECTUAL PROPERTY 13
15. LICENSE FEE 14
16. LICENSED SOFTWARE 14
17. ORDER 14
18. PREVENTIVE MAINTENANCE 14
19. PRINCIPAL PERIOD 15
20. PRODUCT 15
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 3
Agreement No. 980427
INDEX
Page 2 of 85
<TABLE>
<S> <C>
SECTION A - TERMS & CONDITIONS APPLICABLE TO ENTIRE AGREEMENT
21. PROGRAM MATERIAL 15
22. REMEDIAL MAINTENANCE 15
23. SERVICES 15
24. SOFTWARE 15
25. SYSTEM 16
ACCEPTANCE OF GPS MATERIAL AS SUCH 16
ACCESS 17
AFFILIATED COMPANY 18
AMENDMENTS AND WAIVERS 18
ASSIGNMENT 19
CABLES AND RELATED ITEMS 19
CELLULAR SERVICE 19
CHANGES AND SUSPENSIONS 20
CHANGES TO GPS MATERIAL 21
CLEAN UP 21
COMPLAINTS 21
COMPLIANCE WITH LAWS 22
CONFLICT OF INTEREST 23
CONTINUING AVAILABILITY OF PARTS, MAINTENANCE AND TECHNICAL SUPPORT SERVICES 23
CURE 24
DELIVERY 24
DEPLOYMENT SCHEDULE & PHASED IMPLEMENTATION 25
DISPUTES AND DISPUTE RESOLUTIONS 29
DOCUMENTATION 29
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 4
Agreement No. 980427
INDEX
Page 3 of 85
<TABLE>
<S> <C>
SECTION A - TERMS & CONDITIONS APPLICABLE TO ENTIRE AGREEMENT
EMERGENCY EQUIPMENT 29
ENGINEERING, DESIGN AND DEVELOPMENT SERVICES 30
FOB 31
FORCE MAJEURE 31
GOVERNING LAW 32
GRADE OF SERVICE 32
GSM FOR PACIFIC BELL 32
HAZARDOUS MATERIALS AND REGULATED SUBSTANCES 34
HEADINGS 35
HWM'S LIMITATION 35
INDEPENDENT CONTRACTOR 36
INFRINGEMENT 36
INSPECTION 37
INSTALLATION 38
INSURANCE 38
LIABILITY 39
LICENSES & PATENTS 40
M/WBE-DVBE PARTICIPATION PLANS AND REPORT 40
MBE/WBE/DVBE CANCELLATION 40
MOST FAVORED CUSTOMER 42
NO THIRD PARTY BENEFICIARY 43
NON-EXCLUSIVE MARKET RIGHTS 43
NON-INTERVENTION 43
NON-WAIVER 43
NOTICES 44
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 5
Agreement No. 980427
INDEX
Page 4 of 85
<TABLE>
<S> <C>
SECTION A - TERMS & CONDITIONS APPLICABLE TO ENTIRE AGREEMENT
ONGOING PERFORMANCE OF REMOTE PANIC ALARM 45
ORDER ACCEPTANCE 45
ORDER OF PRECEDENCE 45
PERSONNEL EMPLOYMENT 45
PLANT AND WORK RULES 46
POINTS OF CONTACT 46
PRICES AND PAYMENT 46
PRICE PROTECTION 47
PUBLICITY 48
PURCHASE AUTHORIZATION 48
PURCHASE PROVISIONS 49
QUALITY ASSURANCE 49
RECORDS AND AUDIT 51
REGISTRATION 51
RELEASES VOID 51
RELOCATION 52
REMEDIES CUMULATIVE 52
RESPONSIBILITIES 52
RISK OF LOSS 53
SBC AND HWM INFORMATION 53
SEVERABILITY 53
SHIPPING AND BILLING 54
SITE PREPARATION 55
SURVIVAL OF OBLIGATIONS 55
TAXES 56
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 6
Agreement No. 980427
INDEX
Page 5 of 85
<TABLE>
<S> <C>
SECTION A - TERMS & CONDITIONS APPLICABLE TO ENTIRE AGREEMENT
TECHNICAL REQUIREMENTS AND SPECIFICATIONS 58
TERMINATION AND CANCELLATION 58
TIME IS OF THE ESSENCE 59
TIMELY PERFORMANCE 59
TITLE 59
TRADE-INS 59
TRAINING 60
TRANSPORTATION 60
UNIVERSAL DESIGN 61
WARRANTY 62
WORK DONE BY OTHERS 64
WORK HEREUNDER 64
SECTION B - SOFTWARE LICENSE
GENERAL 65
GRANT OF LICENSE 65
DOCUMENTATION UPDATES 65
ERROR CORRECTIONS 66
FORM OF ORDER 68
INSTALLATION OF SOFTWARE 68
SOFTWARE PRODUCT DELIVERY & INSTALLATION 69
RELOCATION OF SOFTWARE 70
RETURN OF SOFTWARE 71
RIGHT TO REPRODUCE GPS MATERIAL AND DOCUMENTATION 71
RISK OF LOSS 71
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 7
Agreement No. 980427
INDEX
Page 6 of 85
<TABLE>
<S> <C>
SECTION B - SOFTWARE LICENSE
SOFTWARE UPDATES 72
SOURCE AVAILABILITY AND SOURCE CODE ESCROW 73
SOURCE CODE 76
STANDARD OF PERFORMANCE 76
TITLE 77
USE OF THE SOFTWARE 77
USE OF PLATFORMS 77
WARRANTY 77
SECTION C - GPS MATERIAL MAINTENANCE SERVICES
GENERAL 80
ACCESS 80
BASIC SERVICE 80
ENGINEERING CHANGES 81
ESCALATION PROCEDURE 82
FORM OF ORDER 82
MAINTENANCE BY OTHERS 83
MAINTENANCE LOG 83
PARTS 83
PARTS INVENTORY 83
REMEDIAL MAINTENANCE 84
STORAGE AND WORK SPACE 84
TERM OF ORDER 85
TIME AND MATERIAL 85
SECTION D - HWM NETWORK SERVICES
GENERAL 86
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 8
Agreement No. 980427
INDEX
Page 7 of 85
<TABLE>
<S> <C>
SCOPE OF RESPONSIBILITY 86
ALARM MONITORING 90
SECTION E - ENTIRE AGREEMENT
ENTIRE AGREEMENT 91
</TABLE>
Appendix I GPS Specifications
Appendix II Pricing
Appendix III Change Order
Appendix IV Executive Orders and Associated Regulations
Appendix V HWM's Quality Program Specifications
Exhibit A PRIME SUPPLIER MBE/WBE/DVBE PARTICIPATION PLAN
Exhibit B PARTICIPATION PLANS AND RESULTS REPORTS
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 9
Agreement No. 980427
SECTION A
Page 8 of 85
SECTION A - TERMS & CONDITIONS APPLICABLE TO ENTIRE AGREEMENT
PREAMBLE
This agreement ("Agreement") is made and entered into by and between
Southwestern Bell Telephone Company, Pacific Bell, Nevada Bell and Southern New
England Telephone (collectively "SBC") and HighwayMaster Corporation ("HWM") to
provide for acquisition, support and development of a Global Positioning
Satellite ("GPS") System and associated material ("GPS Material"). This
Agreement shall be effective as of the date of its execution by the last of the
parties hereto as defined below and, unless otherwise extended or terminated,
shall expire on December 31, 2001, whichever occurs first. SBC's liability for
HWM's costs and termination fees through the date of termination, as set forth
in the "Purchase Authorization" section below, shall survive termination or
expiration of this Agreement for any reason whatsoever, except for cancellation
of this Agreement as a result of HWM's failure to cure a material breach during
the applicable cure period (see, Termination and Cancellation paragraph).
Prior to delivery of Phase 2 requirements, only a failure to deliver GPS
Material failing to meet Phase 1 requirements as set forth in the GPS
specifications ("GPS Specifications"), attached hereto as Appendix I, and by
this reference made a part hereof (defined in the Deployment Schedule below) or
Installation services that do not conform with the GPS Specifications and are
materially defective will be considered a HWM material breach. With the
execution of this Agreement, Agreement No. 980374 will be replaced in its
entirety with this Agreement.
SCOPE OF AGREEMENT
This Agreement is applicable to the procurement by SBC from HWM of Global
Positioning System (GPS) material ("GPS Material") specified in Orders
submitted by SBC and any Software System and Services that have been announced
by HWM on or before the effective date hereof and, unless HWM notifies SBC to
the contrary, material, Software, Systems and Services available after such
effective date. The terms and conditions of this Section A will apply to all
other sections of this Agreement.
The provisions of this Agreement shall apply to all contracts entered into
between HWM and SBC during the term of this Agreement with respect to the GPS
Material and Services which are the subject of this Agreement unless the
parties expressly agree otherwise by a written modification to this Agreement,
signed by the persons who executed this Agreement or their authorized
representatives. In
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 10
Agreement No. 980427
SECTION A
Page 9 of 85
SCOPE OF AGREEMENT (CONTINUED)
the absence of such a modification to this Agreement or such separate
agreement, any terms in any other contract which are additional to, different
from or inconsistent with the provisions of this Agreement shall be deemed to
be void and of no effect whatsoever.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]The prices quoted in
this Agreement are based on the services outlined in Phases 1, 2 and 3 below.
Pricing for future requirements, including development Phase 4 and beyond, will
be negotiated as they are defined.
DEFINITIONS
For the purposes of this Agreement, all terms defined herein will have the
meanings so defined, unless the context clearly indicates otherwise. A term
defined in the singular will include the plural and vice versa when the context
so indicates. As used in this Agreement, the following terms shall have the
definitions set forth below:
1. ACCEPTANCE DATE
"ACCEPTANCE DATE" MEANS THE LAST DAY OF AN ACCEPTANCE PERIOD IN WHICH
A PRODUCT HAS SUCCESSFULLY COMPLETED THE ACCEPTANCE TESTS. IF SBC
WAIVES THE ACCEPTANCE TEST(S) FOR ANY PRODUCT IN WRITING, THE
ACCEPTANCE DATE FOR SUCH PRODUCT WILL BE THE INSTALLATION DATE FOR
SUCH PRODUCT. FOR ANY MAINTENANCE, SUPPORT OR OTHER SERVICE FOR WHICH
AN ACCEPTANCE TEST IS NOT REQUIRED, THE ACCEPTANCE DATE WILL BE THE
EFFECTIVE DATE.
2. ACCEPTANCE PERIOD
"Acceptance Period" means a period of fifteen (15) consecutive
calendar days (or the period specified in the Order) during which the
Acceptance Test(s) for a Product is/are performed.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 11
Agreement No. 980427
SECTION A
Page 10 of 85
DEFINITIONS (CONTINUED)
3. ACCEPTANCE TEST
"Acceptance Test" means the performance and reliability demonstrations
and tests defined herein that must be successfully completed by a
Product during the Acceptance Period which may include but will not
necessarily be limited to: (1) successful completion of SBC's routine
business transactions, (2) tests, demonstrations or transactions
performed during any HWM benchmarking, and (3) any other tests,
demonstrations or transactions included or referenced in the GPS
Specifications or which are appropriate to determine whether the
Product conforms to the requirements of the GPS Specifications.
4. DELIVERY DATE
"Delivery Date" means the date by which all items and parts of the GPS
Material as ordered are delivered to the destination specified in the
applicable Order.
5. DOCUMENTATION
"Documentation" will include, but not be limited to, user and system
manuals, training materials in machine readable or printed form.
6. DOWNTIME
"Downtime" means that period of time during which a Product is not
operating in accordance with the requirements of an Order or the GPS
Specifications as defined herein through no fault of SBC. Unless
otherwise specified herein or in an Order accepted by HWM, downtime
for each malfunction will start when SBC contacts HWM's designated
representative at a prearranged contact point and will end when the
GPS Material is operating in accordance with the requirements of the
Order or GPS Specifications.
7. EFFECTIVE DATE
"Effective Date" means the date shown on an Order which is the
beginning date for such Order.
8. ENTERPRISE LICENSE
"Enterprise License" means Products may be used at any location, on
any platform and by any number of Users.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 12
Agreement No. 980427
SECTION A
Page 11 of 85
DEFINITIONS (CONTINUED)
9. FIELD ENGINEER
"Field Engineer" means a person in HWM's employ qualified to repair
GPS Materials in a timely and professional manner.
10. GPS MATERIAL
"GPS MATERIAL" means an in-vehicle monitoring system as more
specifically defined in the GPS Specifications Document attached
hereto but at a minimum consisting of:
<TABLE>
<S> <C>
- -------------------------------------------------------------------------------------------------------------------
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT. THE OMITTED FOR CONFIDENTIAL TREATMENT. THE OMITTED
MATERIAL HAS BEEN FILED SEPARATELY WITH THE MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 13
Agreement No. 980427
SECTION A
Page 12 of 85
<TABLE>
<S> <C>
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
[Text has been omitted pursuant to a request [Text has been omitted pursuant to a request
for confidential treatment. The omitted for confidential treatment. The omitted
material has been filed separately with the material has been filed separately with the
SEC.] SEC.]
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.
THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
11. INSTALLATION ACCEPTANCE
"INSTALLATION ACCEPTANCE" for the purpose of this Agreement means only
the acceptance of the installation of the GPS Material and not the
acceptance of the GPS Material as such. Installation Acceptance shall
occur when the installed GPS Materials are demonstrated to SBC to be
operational through:
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 14
Agreement No. 980427
SECTION A
Page 13 of 85
DEFINITIONS (CONTINUED)
11. INSTALLATION ACCEPTANCE (CONTINUED)
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH
THE SEC.]12. INSTALLATION DATE
"Installation Date" means the date by which all components of a
Product or System are installed and prepared for Acceptance Tests at
the location specified in the applicable Order. The Installation Date
for Software and GPS Material includes delivery of Software, manuals
and supporting Documentation. The Installation Date may differ from
one Installation Site to another.
13. INSTALLATION SITE
"Installation Site" means the vehicle or work station location,
established by SBC, in which the GPS Material will reside. The
Installation Site(s) for each Product will be identified in the
applicable Order.
14. INTELLECTUAL PROPERTY
"Intellectual Property" means all copyrights, patents, mask works,
trade secrets, or other rights associated with any ideas, concepts,
techniques, inventions, processes, or works of authorship
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 15
Agreement No. 980427
SECTION A
Page 14 of 85
DEFINITIONS (CONTINUED)
15. LICENSE FEE
"License Fee(s)" means the fee associated with licensing of Product(s)
from HWM.
16. LICENSED SOFTWARE
"Licensed Software" means a standard computer program with respect to
which HWM has the right to grant SBC a license or sublicense to use
same. Licenses are granted as either perpetual or periodic, exclusive
or non-exclusive, for which HWM may or may not receive a License Fee.
Licensed Software also includes all associated Documentation.
17. ORDER
"Order" means an SBC document executed hereunder ordering GPS Materials
and/or Services and will be deemed to incorporate (1) the provisions of
this Agreement (including the Exhibits attached hereto), as it may from
time to time be amended, (2) the GPS Specifications applicable to such
Order and (3) any subordinate documents attached to or referenced in
this Agreement, such GPS Specifications or such Order. Each Order will
be deemed to be a separate and independent agreement between the
parties with respect to the subject matter thereof.
18. PREVENTIVE MAINTENANCE
"Preventive Maintenance" means maintenance performed or required to be
performed by HWM on a scheduled basis to keep the GPS Material in good
operating condition in accordance with the requirements of the
applicable Order. Preventive Maintenance, if applicable, will include
(1) calibration, testing, adjustments, cleaning, lubrication,
replacement of worn, defective or questionable parts, (2) maintenance
and engineering services necessary to retrofit or otherwise install
engineering changes, modifications and improvements (including the
latest engineering revision and all reliability improvements) approved
by HWM for SBC's configuration/environment as mutually agreed upon by
SBC and HWM and made to any GPS Material by HWM at any time during the
maintenance term for that GPS Material; and (3) automatic update
services for all manuals and Documentation furnished with any GPS
Material.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 16
Agreement No. 980427
SECTION A
Page 15 of 85
DEFINITIONS (CONTINUED)
19. PRINCIPAL PERIOD
"Principal Period" means a consecutive ten (10)-hour period daily,
Monday through Friday, excluding New Year's Day, Washington's
Birthday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day
and Christmas Day that HWM will install or perform maintenance
services. Unless otherwise specified in the Order, such ten (10) hour
period will be from 8:00 p.m. to 6:00 a.m. based on the local time in
each SBC or Affiliated Company's city.
20. PRODUCT
"Product" means any GPS Material, Software or System acquired by SBC
hereunder as described herein.
21. PROGRAM MATERIAL
"Program Material" means all material associated with Software ordered
hereunder including, but not limited to, test data, flow charts,
Documentation, data file listings, input and output formats. Program
Material expressly excludes source code and source code listings.
22. REMEDIAL MAINTENANCE
"Remedial Maintenance" means maintenance performed by HWM which is
necessary to return inoperative or malfunctioning GPS Material to good
operating condition.
23. SERVICES
"Services" means any service specified in an Order including, but not
limited to, any programming service, Preventive Maintenance, Remedial
Maintenance, software maintenance, technical consultation services,
and support services.
24. SOFTWARE
"Software" means custom Software and Licensed Software, including any
associated compiled program, routine, subroutine translation,
compiler, diagnostic routine, control software, and firmware.
Software does not include source code, source code listings and
similar raw component formats.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 17
Agreement No. 980427
SECTION A
Page 16 of 85
DEFINITIONS (CONTINUED)
25. SYSTEM
"System" means any collection or aggregation of two (2) or more GPS
Materials designed to function, or represented by HWM as being capable
of functioning, as an entity.
ACCEPTANCE OF GPS MATERIAL AS SUCH
SBC reserves the right to accept or reject GPS Materials fifteen (15) days
after delivery at the location designated in the applicable order. If, prior
to Acceptance by SBC, any of the GPS Materials or Services are found to not be
in strict conformance with this Agreement, including the GPS Specifications,
SBC shall have the right: (a) to reject the GPS Materials or Services and,
after providing HWM with written notice and an opportunity to cure as set forth
in this Agreement, cancel the Agreement and any applicable order and return any
GPS Materials or (b) at its option (1) in the case of GPS Materials, require
that such GPS Materials be repaired or replaced promptly at HWM's risk and
expense (including freight charges) within thirty (30) days and (2) in the case
of Services, require the performance or reperformance of such Services.
Acceptance of GPS Materials by SBC shall be without prejudice to SBC's right to
revoke acceptance pursuant to the Uniform Commercial Code. SBC will conduct
and complete acceptance testing, using its best efforts to complete acceptance
for each phase, release or shipment on the day of delivery and installation.
In the event that acceptance is not possible on the day of installation, SBC
will provide a single contact person with authority to sign off on acceptance,
by region, and will use its best efforts to sign off on acceptance or rejection
within two (2) weeks after installation. SBC's acceptance testing will consist
of tests to determine whether the GPS Materials meet the GPS Specifications.
After acceptance of any phase, release or shipment, any subsequent failures of
the GPS Material to meet the GPS Specifications applicable to such phase or
release shall be handled under applicable warranty provisions.
IF HWM IS UNABLE TO DELIVER GPS MATERIAL THAT MEETS THE PHASE 1 SPECIFICATIONS
AS SET FORTH IN THE GPS SPECIFICATIONS, OR IS UNABLE TO INSTALL SUCH MATERIALS
IN ACCORDANCE WITH THE GPS SPECIFICATIONS, BY THE END OF THE APPLICABLE CURE
PERIOD FOR DELIVERY AND INSTALLATION OF PHASE 1 FUNCTIONALITY, SBC WILL HAVE
THE RIGHT TO RECEIVE A REFUND EQUAL TO 100% OF AMOUNTS
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 18
Agreement No. 980427
SECTION A
Page 17 of 85
ACCEPTANCE OF GPS MATERIAL AS SUCH (CONTINUED)
PAID TO HWM EXCEPT FOR NETWORK SERVICE CHARGES, UPON SBC'S RETURN OF THE GPS
MATERIAL IN GOOD WORKING ORDER, NORMAL WEAR AND TEAR EXCLUDED.
IF HWM IS UNABLE TO DELIVER AND INSTALL GPS MATERIAL THAT MEETS THE PHASE 2 AND
PHASE 3 SPECIFICATIONS AS SET FORTH IN THE GPS SPECIFICATIONS, BY THE END OF
THE APPLICABLE CURE PERIOD FOR DELIVERY AND INSTALLATION OF SUCH GPS MATERIAL,
SBC SHALL HAVE THE RIGHT TO REVOKE ITS PREVIOUS ACCEPTANCE AND RECEIVE A REFUND
EQUAL TO EIGHTY-FIVE PERCENT (85%) OF THE AMOUNTS PAID BY SBC TO HWM EXCEPT FOR
NETWORK SERVICE CHARGES, UPON SBC'S RETURN OF THE GPS MATERIAL IN GOOD WORKING
ORDER, NORMAL WEAR AND TEAR EXCLUDED.
ACCESS
SBC's Premises:
1. HWM shall when appropriate have reasonable access to SBC's premises
during normal business hours and at such other times as may be agreed
upon by the parties in order to enable HWM to perform its obligations
under this Agreement. HWM shall coordinate such access with SBC's
designated representative prior to visiting such premises. HWM
assures SBC that only persons employed by HWM or subcontracted by HWM
will be allowed to enter SBC's premises. If SBC requests HWM or it's
Subcontractor to discontinue furnishing any person provided by HWM or
it's Subcontractor from performing work on SBC's premises, HWM shall
immediately comply with such request. Such person shall leave SBC's
premises promptly and HWM shall not furnish such person again to
perform work on SBC's premises without SBC's written consent.
2. SBC may require HWM or its subcontractor employees to exhibit
identification credentials, which SBC may issue in order to gain
access to SBC's premises for the performance of Services hereunder.
If, for any reason, any HWM's or HWM's subcontractor employees are no
longer performing such Services, HWM shall immediately inform SBC.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 19
Agreement No. 980427
SECTION A
Page 18 of 85
ACCESS (CONTINUED)
Notification shall be followed by the prompt delivery to SBC of the
identification credentials, if issued by SBC, or a written statement
of the reasons why said identification credentials cannot be returned.
3. HWM shall ensure that its personnel and subcontractor perform work
which conforms to SBC's practices and handbooks to protect GPS
Material, buildings or structures and to perform Services with care
and due regard for the safety, convenience and protection of SBC, its
employees and property, and members of the public.
4. In the event of theft or loss of property attributable to HWM, HWM
shall replace the property and/or reimburse SBC for replacement value
of the item.
5. HWM shall be responsible for ensuring that all persons furnished by
HWM work harmoniously with all others when on SBC's premises.
AFFILIATED COMPANY
"Affiliated Company" as used herein will be any present or future subsidiary,
affiliate or parent company of SBC. Subject to acceptance of an Order by HWM,
in accordance with the Order Acceptance clause herein, any Affiliated Company
that places an Order with HWM hereunder may incorporate into such Order the
terms and conditions of this Agreement. Such Affiliated Company will be
responsible for its own obligations including, but not limited to, charges
incurred in connection with such Order. Nothing in this Agreement will be
construed as requiring SBC to indemnify HWM for any acts or omissions of any
Affiliated Company.
AMENDMENTS AND WAIVERS
This Agreement may be amended or modified only by a written document signed by
the authorized representative of the party against whom enforcement is sought.
No course of dealing or failure of either party to strictly enforce any term,
right or condition of this Agreement shall be construed as a general waiver or
relinquishment of such term, right or condition. Waiver by either party of any
default shall not be deemed a waiver of any other default.
ASSIGNMENT
Neither party hereto may assign, subcontract or otherwise transfer it's rights
or obligations under this Agreement except with the prior written consent of
the other party hereto, which consent will not be unreasonably withheld;
provided, however, SBC will have the right to assign this Agreement to any
present or future AFFILIATE, SUBSIDIARY OR PARENT CORPORATION of SBC, without
securing the consent of HWM and may grant to any such assignee the same rights
and privileges SBC enjoys hereunder. Any attempted assignment not assented to
in the manner prescribed herein, except an assignment confined solely to money
due or to become due, will be void. It is expressly agreed that any assignment
of money will be void if (a) HWM fails to give SBC at least thirty (30) days
prior written notice thereof, or (b) such assignment imposes or attempts to
impose upon SBC additional costs or obligations in addition to the payment of
such money or (c) denies, alters or attempts to alter any of SBC's rights.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 20
Agreement No. 980427
SECTION A
Page 19 of 85
CABLES AND RELATED ITEMS
Each Order will be deemed to include, at no additional charge unless otherwise
specified, all cables necessary to operate all ordered Product at SBC's
Installation Site in accordance with the GPS Specifications. CELLULAR SERVICE
The actual cellular service for the purpose of this Agreement will be provided
by HWM as follows, in addition to the monthly Network Services fees as outlined
in Appendix II, Pricing, attached hereto and by this reference made a part
hereof:
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]CELLULAR SERVICE
(CONTINUED)[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
CHANGES & SUSPENSIONS
1. SBC may, by notice to HWM at any time before complete delivery is made
under any Order, request changes via a written Change Order, attached
hereto as Appendix III, and by this reference made a part hereof
within the general scope of such Order, including changes to
quantities, drawings, designs or GPS Specifications. Within a
reasonable time of receipt of the written Change Order, HWM shall
provide SBC with a Response to the Change Order including at a minimum
the estimated changes to prices, delivery dates, and the feasibility
of the implementation of changes to the GPS Specifications. SBC and
HWM must agree in writing to acceptance of the Change Order, including
any adjustments in prices or dates necessitated thereby and shall
execute a written revised Order reflecting such adjustments.
2. HWM may not, under any circumstances, rely on oral modifications to
any Order made under this Agreement.
3. If HWM desires to modify the Products and/or Services specified in any
Order, HWM shall provide written notice to SBC of the requested
modifications. SBC shall provide a written response to the request
within fifteen (15) days of the date of receipt of the request from
HWM. SBC shall approve the request if the Products and/or Services,
as modified, conform to the GPS Specifications. SBC has the right to
test any new,
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 21
Agreement No. 980427
SECTION A
Page 20 of 85
CHANGES & SUSPENSIONS
changed or revised Products and/or Services or have it tested by its
third party subcontractor prior to approval. If the Products and/or
Services do not conform to the GPS Specifications, SBC shall have the
right to reject such changes or modifications. In addition, SBC shall
reserve the right to determine whether a new software change is
applied.
CHANGES TO GPS MATERIAL
If HWM desires to modify the GPS Materials, HWM shall provide samples of the
GPS Materials and written notice to SBC of the requested modifications. SBC
shall provide a written response to the request within thirty (30) days of the
date of receipt of the request from HWM. SBC shall approve the request if the
GPS Materials, as modified, conform to the GPS Specifications. For purposes of
this clause, GPS Materials include GPS receiver, antenna, cellular Transceiver
and cellular antenna, microprocessor, handset, power supply, panic alarm, key
fob, modem and installation components such as the pedestal.
SBC has the right to test any new, changed or revised GPS Material or have it
tested by its third party subcontractor prior to approval. If the GPS Material
does not conform to the GPS Specifications, SBC shall have the right to reject
such changes or modifications. In addition, SBC shall reserve the right to
determine whether the new GPS Material is acceptable.
CLEAN UP
Upon completion of the installation of any Product hereunder, HWM will remove
promptly all HWM's tools, equipment, materials and debris from SBC's premises.
COMPLAINTS
SBC reserves the right to notify HWM in cases where SBC has identified current
or potential problems or service area concerning the operation, maintenance,
engineering, installation or design of GPS Material furnished hereunder.
Whenever SBC exercises such right, HWM agrees to:
1. Accept such notice (hereinafter referred to as an "Engineering Complaint")
and respond appropriately to resolve the Engineering Complaint. HWM agrees
to review the standards contained in Bell Communications Research,
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 22
Agreement No. 980427
SECTION A
Page 21 of 85
COMPLAINTS (CONTINUED)
Inc. ("Bellcore") technical publication GR-230-CORE, Issue 1,
September 1994, entitled "Engineering Complaints and Service Failure
Analysis Reports" during the ninety (90) days following the execution
of this Agreement so that it can determine whether it is feasible for
HWM to comply with these standards. If it is economically and
operationally feasible for HWM to comply with the Bellcore standards
without material additional operational expense on HWM's part, HWM
agrees to use its best effort to comply.
2. Acknowledge receipt of such Engineering Complaint and advise SBC of
HWM's proposed organization responsible for resolving it within ten
(10) working days of HWM's receipt thereof.
3. Resolve such Engineering Complaints within ninety (90) days calendar
days of the date of SBC's notice, unless a later date is mutually
agreed upon by the parties. If unable to resolve an Engineering
Complaint within said ninety (90)-day period, HWM will issue an
"interim report" as defined in GR-230-CORE.
4. Furnish to SBC a monthly report of the status of open Engineering
Complaints, in a mutually agreed upon medium, together with a proposed
schedule for their resolution.
5. Notify SBC in writing when an Engineering Complaint has been resolved.
COMPLIANCE WITH LAWS
HWM shall comply with the provisions of the Fair Labor Standards Act, the
Occupational Safety and Health Act and all other applicable federal, state,
county and local laws, ordinances, regulations and codes, including, but not
limited to, the procurement of permits, certificates, approvals, inspections
and licenses when needed, in the performance of this Agreement.
Southwestern Bell Telephone Company, Pacific Bell, and Nevada Bell, as common
carriers of telecommunications services, work as contractors for various
departments and agencies of the United States Government, and, for that reason,
work under their agreements may be subject to certain Executive Orders, laws ,
and associated regulations. To the extent that such Executive Orders, laws,
and associated regulations apply to work under this agreement, and only to that
extent, HWM agrees to comply with the provisions of Appendix IV, Executive
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 23
Agreement No. 980427
SECTION A
Page 22 of 85
COMPLIANCE WITH LAWS (CONTINUED)
Orders and Associated Regulations attached hereto and by this reference made a
part hereof.
CONFLICT OF INTEREST
HWM represents and warrants that no officer, director, employee or agent of SBC
has been or will be employed, retained or paid a fee, or otherwise has received
or will receive any personal compensation or consideration, by or from HWM or
any of HWM's officers, director's employees or agents in connection with the
obtaining, arranging or negotiation of this Agreement or other documents or
agreements entered into or executed in connection herewith.
CONTINUING AVAILABILITY OF PARTS, MAINTENANCE AND TECHNICAL SUPPORT SERVICES
1. HWM agrees to offer for sale to SBC for a period of five (5) years
after the Termination, Cancellation or expiration date of this
Agreement, functionally equivalent additions/modifications,
maintenance, replacement, and technical support services at HWM's then
current rates for said parts and/or services,
2. If HWM fails or is unable to supply such parts or obtain another
source of supply for SBC, then such inability shall be considered
noncompliance with this Section and, in addition to whatever other
rights and remedies SBC may have at law or in equity, HWM shall be
obligated to provide SBC, without obligation or charge, with limited,
nonexclusive license to the "technical information" or any other
rights required so that SBC can have manufactured or can obtain such
parts from other sources. No right of sublicense is granted herein.
3. The "technical information" includes, by example and not by way of
limitation:
a. manufacturing drawings and GPS Specifications of raw materials
and components comprising such parts;
b. manufacturing drawings and GPS Specifications covering special
tooling and the operation thereof;
c. a detailed list of all commercially available parts and
components purchased by HWM, disclosing the part number,
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 24
Agreement No. 980427
SECTION A
Page 23 of 85
CONTINUING AVAILABILITY OF PARTS, MAINTENANCE AND TECHNICAL SUPPORT SERVICES
(CONTINUED)
name and location of the supplier and price lists for the purchase
thereof.
4. HWM shall provide support for System Software or System Software
Features provided under this Agreement. In the event HWM refuses to
provide support then HWM shall grant to SBC a non-exclusive license,
without charge, to use such System Software programs, System Software
documentation and/or System Software tools and other technical
information as may be required for the purpose of so maintaining the
System Software and to provide for network compatibility. No right of
sublicense is granted to SBC.
5. HWM shall provide SBC advance written notification no later than two
(2) years prior to the discontinuance of the manufacture or the
provision of any GPS Material hereunder.
CURE
SBC will not be deemed to be in default under any of the terms of this
Agreement, and HWM may not seek or attempt to enforce any remedy for any
claimed default, unless SBC fails to cure or correct same within thirty (30)
days following receipt of written notice thereof from HWM.
DELIVERY
HWM agrees to make its best efforts barring complication in procuring parts to
have at least eleven thousand five hundred (11,500) GPS Units installed by
December 29, 1998. HWM further agrees to keep SBC informed, in writing, of any
delays in meeting this schedule.
HWM agrees to deliver all GPS Material on the Delivery Dates and to the
Installation Sites specified in the applicable Orders. SBC may request
delivery in advance of the Delivery Date specified in an Order by notifying HWM
in writing to that effect at least thirty (30) days prior to the specified
Delivery Date. If such advanced delivery is accepted by HWM, SBC will amend
the Order accordingly.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 25
Agreement No. 980427
SECTION A
Page 24 of 85
DELIVERY (CONTINUED)
At any time, but not less than thirty (30) days prior to the Delivery Date
specified in an Order, SBC, by written notification to HWM, may delay such
Date, for a period not to exceed thirty (30) days. HWM will assume full
responsibility for dealing with carriers to insure timely delivery of its
shipments, locate missing or late shipments, resolve billing for transportation
charges and submit and resolve all insurance claims arising from damage to its
shipments.
DEPLOYMENT SCHEDULE AND PHASED IMPLEMENTATION
GPS MATERIAL INSTALLATION
HWM shall begin installation of the eleven thousand five hundred
(11,500) GPS Units on September 15, 1998. HWM will use its best
efforts to deliver and install the units by December 29, 1998. [Text
has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] Prices for
installation are shown on Appendix II, and should be combined on the
invoice with the GPS Material upon completion of Installation
Acceptance. SWBT will remit to HWM payment in full as outlined in the
clause entitled Prices and Payment. Installation Acceptance shall be
completed within two (2) weeks of delivery and installation of such
shipment. HWM will deploy installers who will be dedicated an average
of eight (8) hours per day, five (5) days per week.
PHASES
This clause describes the basic requirements and development items for
the SBC GPS System. HWM and SBC agree to complete the GPS
Specifications that will provide the functionality specified below for
Phases 1, 2, and 3 as per the dates specified below:
1. HWM will develop and present their complete thorough GPS
Specification to SBC by September 12, 1998.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 26
Agreement No. 980427
SECTION A
Page 25 of 85
DEPLOYMENT SCHEDULE AND PHASED IMPLEMENTATION (CONTINUED)
2. SBC will review and provide comments to HWM on the GPS
Specifications by September 22, 1998.
3. SBC and HWM will meet to resolve any disputes in the GPS
Specifications.
Each party agrees to devote the necessary resources to complete the GPS
Specifications.
If HWM and SBC cannot resolve any disputes remaining after 3, above,
HWM's decision will prevail. However, SBC has the right to escalate
the dispute directly to a single arbitrator (in accordance with the
provisions specified in the paragraph of this Agreement called
"Disputes and Dispute Resolution") to present its case that HWM's
omission of a GPS Specification is, or inclusion of a GPS
Specification is not, necessary to meet the GPS System functionality.
HWM represents and warrants that the GPS Specifications will meet the
functionality for Phases 1, 2 and 3.
Once the GPS Specifications are complete and are executed by both
parties, the GPS Specifications will control over any discrepancies or
ambiguities between the RFP and the Phase 1, 2 and 3 descriptions in
this Agreement.
In developing the GPS Specifications, the parties agree that the scope
and functionality of the GPS Material will not expand beyond that set
forth in Phases 1, 2 and 3 herein and in the product specification
document which is attached hereto . Any additional or subsequent
changes will only be made upon the mutual agreement of the parties and
will be treated as a Change Order, subject to the payment of
additional development and/or product fees to HWM if SBC requests
expanded functionality.
HWM agrees to provide the following requirements and functionality as generally
described below and more specifically described in the GPS Specifications
Document attached to this Agreement:
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 27
Agreement No. 980427
SECTION A
Page 26 of 85
DEPLOYMENT SCHEDULE AND PHASED IMPLEMENTATION (CONTINUED)
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
DEPLOYMENT SCHEDULE AND PHASED IMPLEMENTATION (CONTINUED)[TEXT HAS BEEN OMITTED
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SEC.]
Should HWM not meet the requirements outlined under Phase 2 above, by
delivering the software enhancements necessary to meet the GPS Specifications
to provide such requirements and making it available for Installation by
January 15, 1999, or within a period of thirty (30) days thereafter then, in
addition to all other remedies provided under this Agreement or at law, HWM
agrees to credit or refund SWBT as liquidated damages and not as a penalty, an
amount equal to ten thousand dollars ($10,000) for each month after January,
1999, during any portion of which the delay continues.
Should HWM not meet the requirements outlined under Phase 3 above, by
delivering the software enhancements necessary to meet the GPS Specifications
to provide such requirements and making it available for Installation by
January 15, 1999, or within a period of thirty (30) days thereafter then, in
addition to all other remedies provided under this Agreement or at law, HWM
agrees to credit or refund the entities of Pacific Bell and Nevada Bell as a
whole, as liquidated damages and not as a penalty, an amount equal to ten
thousand dollars ($10,000) for each month after January, 1999, during any
portion of which the delay continues. If HWM should fail to meet this date
through no fault of its own, such as an unforeseen issue, non-performance or
failure of cooperation related to a third party (such as Nokia), the above
liquidated damage clause would not be applicable, and HWM's Delivery Dates
shall be extended in proportion to such delay by a third party.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 28
Agreement No. 980427
SECTION A
Page 27 of 85
DISPUTES AND DISPUTE RESOLUTION
Any dispute arising out of or relating to this Agreement or the breach,
Termination, or validity thereof, not settled within thirty (30) days of
written notice of such dispute, shall be settled by arbitration in accordance
with the then current Center for Public Resources Rules for Non-Administered
Arbitration of Business Disputes by three independent and impartial
arbitrators, of whom each party shall appoint one and the two appointed
arbitrators shall pick a third arbitrator. The arbitration shall be governed
by the United States Arbitration Act, 9 U.S.C. Sections 1-16 and judgment upon
the award rendered by the arbitrators may be entered by any court having
jurisdiction thereof. The place of arbitration shall be San Ramon, California,
St. Louis, Missouri, or Dallas, Texas, or their environs at the discretion of
the party requesting arbitration. The arbitrators are not empowered to award
damages in excess of compensatory damages and each party hereby irrevocably
waives any right to recover such damages with respect to any dispute resolved
by arbitration. Final and binding arbitration in accordance with the
procedures specified in this Section shall be the sole and exclusive procedure
for the resolution of any such disputes.
DOCUMENTATION
HWM will provide, at no additional cost to SBC, at least two (2) copies of each
update or revision to such original Documentation to each Installation Site and
SBC's General Headquarters. Additional copies of such Documentation will be
furnished at the then current per copy prices as specified in HWM's price list.
SBC will have the right to reproduce all printed material, Documentation, and
manuals supplied by HWM hereunder, provided that such reproduction is made
solely for SBC's internal use hereunder and includes any HWM copyright notice
contained in the original item being reproduced.
SBC may modify any Documentation for its own use and at its own expense to meet
its specific requirements.
EMERGENCY EQUIPMENT
HWM agrees to make every reasonable effort to assist SBC in locating GPS
Material compatible with that furnished by HWM hereunder in the event of an
emergency, such as a major breakdown, fire or other disaster.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 29
Agreement No. 980427
SECTION A
Page 28 of 85
EMERGENCY EQUIPMENT (CONTINUED)
SBC, at its option, may accept or reject an offer by HWM to use emergency or
substitute GPS Material. If accepted, the charge for such use, if any, will be
a limited arrangement between SBC and HWM until permanent replacement GPS
Material is installed and accepted.
ENGINEERING, DESIGN AND DEVELOPMENT SERVICES
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.] [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.]
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
FOB
GPS Material purchased hereunder will be shipped FOB Destination, prepay and
add, in accordance with the requirements of the clauses herein entitled
SHIPPING AND BILLING and TRANSPORTATION.
FORCE MAJEURE
1. Neither party shall be deemed in default of this Agreement or any
Order to the extent that any delay or failure in the performance of
its obligations results from any cause beyond its reasonable control
and without its fault or negligence, such as acts of God, acts of
civil or military authority, embargoes, epidemics, war, riots,
insurrections, fires, explosions, earthquakes, floods, unusually
severe weather conditions or strikes.
2. If any Force Majeure condition occurs, HWM shall give immediate notice
to SBC and SBC may elect to either: (1) terminate the affected
Order(s) or any part thereof, (2) suspend the affected Order(s) or any
part thereof for the duration of the Force Majeure condition, with the
option to obtain elsewhere GPS Material and Services to be furnished
under such Order(s) and deduct from any commitment under such Order(s)
the quantity of the GPS Material and Services obtained or for which
commitments have been made elsewhere or (3) resume performance under
such Order(s) once the Force Majeure condition ceases, with an option
in SBC to extend any affected delivery or performance date up to the
length of time the Force Majeure condition endured. Unless SBC gives
written notice within thirty (30) days after being notified of the
Force Majeure condition, option (2) shall be deemed selected.
3. Failure of HWM's subcontractors or suppliers to deliver GPS Material
or perform Services shall not be deemed a Force Majeure condition
unless such failure or delay is a result of a Force Majeure
experienced by HWM's subcontractors or suppliers.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 30
Agreement No. 980427
SECTION A
Page 29 of 85
GOVERNING LAW
1. With respect to Pacific Bell and Nevada Bell, this Agreement and
performance hereunder shall be governed by the laws of the state of
California. With respect to Southwestern Bell Telephone Company, this
Agreement and performance hereunder shall be governed by the laws of
the state of Missouri. With respect to Southern New England
Telephone, this Agreement and performance hereunder shall be governed
by the laws of the state of Connecticut.
2. This Agreement shall be considered completed, entered into, and
executed in California on behalf of Pacific Bell and Nevada, in
Missouri on behalf of Southwestern Bell Telephone Company and
Connecticut on behalf of Southern New England Telephone.
GRADE OF SERVICE
The parties agree to develop minimum performance standards to which the GPS
Materials comply. [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
GSM FOR PACIFIC BELL
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
GSM FOR PACIFIC BELL (CONTINUED)[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH
THE SEC.]If HWM should fail to meet this date through no fault of its own, such
as an unforeseen issue related to a third party or lack of necessary
cooperation by SBC or its affiliates, the above liquidated damage clause would
not be applicable.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 31
Agreement No. 980427
SECTION A
Page 30 of 85
HAZARDOUS MATERIALS AND REGULATED SUBSTANCES
A "Regulated Substance" as referenced in this clause is a generic term used to
describe all materials that are regulated by the federal or any state or local
government during transportation, handling and/or disposal. This includes, but
is not limited to, materials that are regulated as (a) "hazardous materials"
under the Hazardous Materials Act and the Control of Radioactive Contamination
of the Environment Law, Title 8 of the California Administrative Code, Section
5194, pursuant to the Hazardous Substances Information and Training Act, (b)
"chemical hazards" under Occupational Safety and Health Administration (OSHA)
standards, (c) "chemical substances or mixtures" under the Toxic Substances
Control Act, (d) "pesticides" under the Federal Insecticide, Fungicide and
Rodenticide Act, and (e) "hazardous wastes" as defined or listed under the
Resource Conservation and Recovery Act and the Hazardous Waste Control Law.
1. HWM shall comply with all applicable federal, state and local
laws, ordinances, codes, regulations and orders, including any
notice requirements (individually and collectively "Laws and
Regulations"), regarding any Material and Service ordered
hereunder which involves the handling or use of Materials or
materials which consist of or contain "hazardous materials" or
"chemical hazards" or "chemical substances or mixtures" or
"pesticides" or "hazardous wastes". HWM shall notify SBC and
provide to SBC all necessary notification and other
information (including but not limited to OSHA Material Safety
Data Sheets) at least thirty (30) days before shipping such
Regulated Substances to SBC or commencing the performance of
Services for SBC involving the handling or use of Regulated
Substances.
2. Notwithstanding any other provisions of this Agreement, SBC
shall have the right, but not the duty, to terminate without
liability any Order for Materials or Services which involves
the handling or use of Regulated Substances within thirty (30)
days after such notification from HWM. Otherwise, SBC and HWM
shall cooperate concerning the acceptance by SBC of such
Regulated Substances. HWM shall mark all Materials and/or
materials provided hereunder as Regulated Substances which are
required by all applicable Laws and Regulations to be so
marked, and shall provide assistance to SBC of an advisory
nature in the handling or use of Regulated
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 32
Agreement No. 980427
SECTION A
Page 31 of 85
HAZARDOUS MATERIALS AND REGULATED SUBSTANCES (CONTINUED)
Substances provided hereunder and the disposal of "hazardous
wastes", as defined by applicable Laws and Regulations
("Hazardous Wastes"), resulting therefrom.
3. Regulated Substances and/or Hazardous Wastes provided or
removed hereunder shall be transported by HWM in accordance
with the requirements of the applicable Laws and Regulations,
including, but not limited to, those of the Department of
Transportation and California Highway Patrol, governing
transportation of such Regulated Substances and/or Hazardous
Wastes.
4. HWM shall provide SBC with the same information pertaining to
Materials and Services which involve the handling or use of
Regulated Substances or Hazardous Wastes as HWM provides to
HWM's employees or agents involved in the disposition or
treatment of such Regulated Substances or Hazardous Wastes.
5. HWM further agrees to defend, indemnify and hold SBC harmless
from and against any damage, or expense (including attorneys'
fees and court costs) sustained by SBC because of HWM's
noncompliance herewith.
HEADINGS
Article, section or paragraph headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
HWM'S LIMITATION
EXCEPT FOR INDEMNITY AND INFRINGEMENT INDEMNITY OBLIGATIONS, SBC'S DAMAGES AND
HWM'S LIABILITY FOR DAMAGES UNDER ALL ORDERS SHALL BE LIMITED TO A REFUND OF
THE AMOUNTS PAID BY SBC FOR THE AFFECTED PRODUCT OR SERVICES. NEITHER PARTY
SHALL BE LIABLE TO THE OTHER FOR INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES
INCLUDING LOST PROFITS.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 33
Agreement No. 980427
SECTION A
Page 32 of 85
INDEPENDENT CONTRACTOR
HWM hereby declares and represents that HWM is engaged in an independent
business and shall perform its obligations under this Agreement as an
independent contractor and not as the agent or employee of SBC; that the
persons performing services hereunder are not agents or employees of the SBC;
that HWM has and hereby retains the right to exercise full control of and
supervision over the performance of HWM's obligations hereunder and full
control over the employment, direction, compensation and discharge of all
employees assisting in the performance of such obligations; that HWM shall be
solely responsible for all matters relating to payment of such employees,
including compliance with workers' compensation, unemployment, disability
insurance, social security, withholding and all other federal, state and local
laws, rules and regulations governing such matters; and that HWM shall be
responsible for HWM's own acts and omissions and those of HWM's agents,
employees and contractors during the performance of HWM's obligations under
this Agreement.
INFRINGEMENT
HWM agrees to indemnify and hold SBC harmless from and against any loss,
liability, damage or expense (including increased damages for willful
infringement, punitive damages, attorneys' fees and court costs) that may
result by reason of any infringement, or claim of infringement, of any trade
secret, patent, trademark, copyright or other proprietary interest of any third
party based on the normal use or installation of any GPS Material, Software,
Documentation, or program furnished to SBC hereunder, except to the extent that
such claim arises from HWM's compliance with SBC's detailed instructions. Such
exception will not, however, include:
1. Merchandise available on the open market or the same as such
merchandise.
2. Items of HWM's origin, design or selection.
HWM warrants that it has made reasonable independent investigation (including
obtaining legal opinions) to determine the legality of its right to produce and
sell the GPS Material/Equipment provided herein.
If an injunction or order is obtained against SBC's use of any GPS Material,
Software, Documentation, or program, or if in HWM's opinion any GPS Material,
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 34
Agreement No. 980427
SECTION A
Page 33 of 85
INFRINGEMENT (CONTINUED)
Software, Documentation, or program is likely to become the subject of a claim
of infringement, HWM will, at its expense:
1. Procure for SBC the right to continue using the GPS Material,
Software, Documentation, program; or
2. After consultation with SBC, replace or modify the GPS
Material, Software, Documentation, program or Service to make
it a substantially similar, functionally equivalent,
non-infringing GPS Material, Software, Documentation, program.
If the GPS Material, Software, Documentation, or program is purchased or
licensed and neither (1) or (2) above is possible, SBC may cancel the
applicable Order and require HWM to remove such GPS Material, Software,
Documentation, or program from SBC's location and refund on a prorated basis at
a rate of twenty percent (20%) per year for any charges paid therefor by SBC.
In no event will SBC be liable to HWM for any charges after the date that SBC
no longer uses and GPS Material, Software, Documentation, or program because of
actual or claimed infringement.
Each party hereto agrees to defend or settle, at its own expense, any action or
suit against the other party hereto for which it is responsible under this
clause. Each party further agrees to notify the other party promptly of any
claim of infringement for which the other party is responsible hereunder and
cooperate in every reasonable way to facilitate the defense thereof.
In the event that HWM, after notification of any claim for which HWM is
responsible, does not assume the defense of such action, HWM will reimburse SBC
for all of its costs incurred in the defense of the claim, including, but not
limited to attorneys' fees and interest on such SBC's payment of said amounts
from the date of SBC's payments of said amounts.
INSPECTION
When so stated in SBC's Order, HWM agrees to (a) notify SBC or SBC's agent when
GPS Material is ready for inspection, (b) give SBC such reasonable opportunity
to inspect such GPS Material at any time prior to the scheduled shipment date,
and (c) provide without charge any production testing facilities and
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 35
Agreement No. 980427
SECTION A
Page 34 of 85
INSPECTION (CONTINUED)
personnel required to inspect the GPS Material under the inspection
instructions specified. Purchase of any GPS Material under this Agreement is
subject to SBC's inspection and acceptance after delivery. It is mutually
agreed that SBC or SBC's agent may develop inspection instructions which will
be made a part of this Agreement at a later date by written agreement of the
parties. Inspection or failure to inspect on any occasion will not affect
SBC's rights under warranty or other provisions of this Agreement.
INSTALLATION
HWM agrees to install, at the price specified in Appendix II, Pricing, all GPS
Material ordered hereunder, including all necessary cabling, connection with
SBC-supplied power, utility and communications services, and in all other
respects make the GPS Material ready for operational use.
The GPS Material will be deemed installed and ready for operational use at the
conclusion of a successful Acceptance Test performed at the Installation Site
which demonstrates that the GPS Material meets minimum design capabilities.
HWM will provide SBC with written documentation of the successful Acceptance
Test and certify, by the Installation Date, that the GPS Material is ready for
operational use in accordance with SBC's Order. HWM's General Installation
and Testing Requirements are included in GPS Specifications.
INSURANCE
With respect to performance hereunder, and in addition to HWM's obligation to
indemnify, HWM agrees to maintain, at all times during the term of this
Agreement, the following minimum insurance coverages and limits and any
additional insurance and/or bonds required by law:
1. Workers' Compensation insurance with benefits afforded under
the laws of the state in which the Services are to be
performed and Employers Liability insurance with minimum
limits of $100,000 for Bodily Injury-each accident, $500,000
for Bodily Injury by disease-policy limits and $100,000 for
Bodily Injury by disease-each employee.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 36
Agreement No. 980427
SECTION A
Page 35 of 85
INSURANCE (CONTINUED)
2. Commercial General Liability insurance with minimum limits of:
$2,000,000 General Aggregate limit; $1,000,000 each occurrence
sub-limit for all bodily injury or property damage incurred in any one
occurrence; $1,000,000 each occurrence sub-limit for Personal Injury
and Advertising; $2,000,000 Products/Completed Operations Aggregate
limit, with a
$1,000,000 each occurrence sub-limit for Products/Completed
Operations. Fire Legal Liability sub-limits of $300,000 are required
for lease agreements.
3. Southwestern Bell Telephone Company AND Pacific Bell will be named as
an Additional Insured on the Commercial General Liability policy.
4. If use of a motor vehicle is required, Automobile Liability insurance
with minimum limits of $1,000,000 combined single limits per
occurrence for bodily injury and property damage, which coverage shall
extend to all owned, hired and non-owed vehicles.
5. SBC requires that companies affording insurance coverage have a B+ VII
or better rating, as rated in the A.M. Best Key rating Guide for
Property and Casualty Insurance Companies.
A certificate of insurance stating the types of insurance and policy limits
provided the HWM must be received prior to commencement of any work. The HWM
shall also require all subcontractors who may enter upon the work site to
maintain the same insurance requirements listed above.
LIABILITY
HWM shall indemnify, defend and hold harmless SBC (including its agents,
employees, officers, and directors) from and against any and all liability,
loss, damage, court cost, attorneys' fees or other expense of any kind which
arises out of any claim, demand, suit for damages, injunction or other relief,
on account of (a) injury to or death of any person, (b) damage to any property,
including theft, (c) public charges and penalties, or (d) any lien, caused by,
or resulting from the acts or omissions of the HWM (including any of its HWMs,
agents, or subcontractors but excepting the negligence or willful misconduct
solely of SBC or its employees) in furnishing the GPS Materials or Services
hereunder. This
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 37
Agreement No. 980427
SECTION A
Page 36 of 85
LIABILITY (CONTINUED)
indemnity shall survive the delivery, inspection and acceptance of the GPS
Materials or Services hereunder. HWM agrees to defend SBC, at no cost or
expense to SBC, against any such liability, claim, demand, suit or legal
proceeding. SBC agrees to notify HWM within a reasonable time of any written
claims or demands against SBC for which HWM is responsible under this clause.
LICENSES & PATENTS
No licenses, express or implied, under any patents are granted by SBC to HWM
under this Agreement.
M/WBE-DVBE PARTICIPATION PLANS AND REPORTS
HWM commits to goals for the participation of M/WBE and DVBE firms (as defined
in the Section entitled "MBE/WBE/DVBE Cancellation Clause) as follows: 0%
annual MBE participation; 0% annual WBE participation; and 0% annual DVBE
participation. These goals apply to all annual expenditures by any entity
pursuant to this Agreement with HWM.
Attached hereto and incorporated herein as Exhibit A is HWM's completed Prime
Contractor MBE/WBE/DVBE Commodity Product Subcontracting Plan outlining its
M/WBE-DVBE goals and specific and detailed plans to achieve those goals. HWM
will submit an updated Participation Plan annually by the first week in
January. HWM will submit M/WBE-DVBE Results Reports quarterly by the end of
the first week following the close of each quarter, using the form attached
hereto and incorporated herein as Exhibit B, Participation Plans and Results
Reports will be submitted to the Prime Supplier Results Manager.
MBE/WBE/DVBE CANCELLATION
1. HWM agrees that falsification or misrepresentation of, or failure to
report a disqualifying change in, the MBE/WBE/DVBE status of HWM or
any subcontractor utilized by HWM; or HWM's failure to cooperate in
any investigation conducted by SBC, or by SBC's agent, to determine
HWM's compliance with this section, will constitute a material breach
of this
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 38
Agreement No. 980427
SECTION A
Page 37 of 85
MBE/WBE/DVBE CANCELLATION (CONTINUED)
Agreement. In the event of any such breach, SBC may, at its option,
cancel ("Cancel") this Agreement upon twenty (20) days notice. HWM
acknowledges and agrees that SBC's right to Cancel is absolute and
unconditional, and SBC shall not be subject to liability, nor shall
HWM have any right to suit for damages as a result of such
cancellation.
2. For purchases under this Agreement by Pacific Bell, Pacific Bell
Directory, Pacific Bell Mobile Services, Pacific Bell Information
Services, Pacific Bell Communications, and any other entity operating
principally in California (collectively "California Affiliates"),
Minority and Women Business Enterprises (MBEs/WBEs) are defined as
businesses which satisfy the requirements of paragraph 3. below and
are certified as MBEs/WBEs by the California Public Utilities
Commission Clearinghouse ("CPUC-certified"). For purchases under this
Agreement by any entity that is not a California Affiliate, MBEs/WBEs
are defined as businesses which satisfy the requirements of paragraph
3. below and are either CPUC-certified or are certified as MBEs/WBEs
by a certifying agency recognized by SBC.
3. MBEs/WBEs must be at least 51% owned by a minority individual or group
or by one or more women (for publicly- held businesses, at least 51%
of the stock must be owned by one or more of those individuals), and
the MBEs/WBEs' management and daily business operations must be
controlled by one or more of those individuals, and these individuals
must be either U.S. citizens or legal aliens with permanent residence
status. For the purpose of this definition, minority group members
include male or female Asian Americans, Black Americans, Filipino
Americans, Hispanic Americans, Native Americans (i.e., American
Indians, Eskimos, Aleuts and Native Hawaiians), Polynesian Americans,
and multi-ethnic (i.e., any combination of MBEs and WBEs where no one
specific group has a 51% ownership and control of the business, but
when aggregated, the ownership and control combination meets or
exceeds the 51% rule). "Control" in this context means exercising the
power to make policy decisions. "Operate" in this context means
actively involved in the day-to-day management of the business and not
merely acting as officers or directors.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 39
Agreement No. 980427
SECTION A
Page 38 of 85
MBE/WBE/DVBE CANCELLATION (CONTINUED)
4. For purchases under this Agreement by California Affiliates, Disabled
Veteran Business Enterprises (DVBEs) are defined as business concerns
that satisfy the requirements of paragraph 5 below and are certified
as DVBEs by the California State Office of Small and Minority Business
(OSMB). The DVBE must be a resident of the State of California, and
must satisfy the requirements of paragraph 5 below. For purchases
under this Agreement by any entity that is not a California Affiliate,
DVBEs are defined as any business concern that satisfies the
requirements of paragraph 5 below and is either a defined DVBE for
purchases by California Affiliates, or is certified as a DVBE by a
certifying agency recognized by SBC.
5. The DVBE must be (1) a sole proprietorship at least 51% owned by one
or more disabled veterans; or (2) a publicly-owned business in which
at least 51% of the stock is owned by one or more disabled veterans;
or (3) a subsidiary which is wholly owned by a parent corporation, but
only if at least 51% of the voting stock of the parent corporation is
owned by one or more disabled veterans; or (4) a joint venture in
which at least 51% of the joint venture's management and control and
earnings are held by one or more disabled veterans. In each case, the
management and control of the daily business operations must be by one
or more disabled veterans. A disabled veteran is a veteran of the
military, naval or air service of the United States with a service-
connected disability. "Management and control" in this context means
exercising the power to make policy decisions and actively involved in
the day-to-day management of the business and not merely acting as
officers or directors.
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 40
Agreement No. 980427
SECTION A
Page 39 of 85
MOST FAVORED CUSTOMER (CONTINUED)
HWM shall review and certify its compliance with this clause to SBC annually.
Should such annual review indicate that SBC has not received the treatment to
which SBC is entitled, HWM shall provide SBC with GPS Material and/or Service
credits sufficient to fully compensate SBC for differences.
NO THIRD PARTY BENEFICIARIES
The provisions of this Agreement are for the benefit of the parties and not for
any other person.
NON-EXCLUSIVE MARKET RIGHTS
It is expressly understood and agreed that this Agreement does not grant HWM an
exclusive privilege to provide to SBC any or all GPS Material and Services of
the type described in this Agreement. It is, therefore, understood that SBC
may contract with other manufactures and suppliers for the procurement or trial
of comparable products and services and that SBC may itself perform the
Services described herein.
NON-INTERVENTION
In connection with the provision of GPS Material and Services by HWM to SBC,
HWM agrees that HWM, either directly or indirectly, shall not intentionally
attempt to influence any regulatory, legislative, or judicial body so as to,
prevent, or delay the offering of products or services by SBC which utilize the
GPS Material or Services supplied by HWM.
NON-WAIVER
No course of dealing or failure of either party to enforce strictly any term,
right or condition of this Agreement will be construed as a waiver of such
term, right or condition. The waiver by any party hereto of any default of any
other party hereto hereunder will not be deemed a waiver of any other prior or
subsequent defaults of any other party hereto. The express provision herein
for certain rights and remedies of the parties hereto are in addition to any
other legal and equitable rights and remedies to which the parties hereto
would otherwise be entitled.
NOTICES
Unless otherwise specifically provided in this Agreement or in any applicable
Order, all notices required or permitted by this Agreement shall be in writing
and may be delivered personally via courier or overnight delivery service, or
may be sent by facsimile or registered mail, return receipt requested, to the
following addresses, unless the parties are subsequently notified of any change
of address in accordance with this Section:
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 41
Agreement No. 980427
SECTION A
Page 40 of 85
If to HighwayMaster:
HighwayMaster Corporation
1155 Kas Drive
Richardson, Texas 75081
Attention: General Counsel
Facsimile: (972) 301-2263
If to SBC:
SBC
1010 Pine, 9-E-80
St. Louis, Missouri 63101
Attention: Chris Vilcinskas
Facsimile: (314) 235-8601
If to Affiliate:
(Affiliate Name)
(Affiliate Street Address)
(Affiliate City State Zip)
(Attention: Affiliate Contact Person)
Facsimile: (Affiliate Fax Number)
Any notice shall be deemed to have been received as follows: (1) by personal
delivery upon receipt; (2) by facsimile upon receipt; (3) by certified mail,
five (5) business days after delivery to the U.S. postal authorities by the
party serving notice. If notice is sent by facsimile, a confirming copy of the
same shall be sent by mail to the same address.
The address to which notices or communications may be given by either party may
be changed by written notice given by such party to the other pursuant to this
paragraph entitled "Notices".
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
ORDER ACCEPTANCE
HWM agrees to acknowledge in writing to SBC receipt of each Order within ten
(10) days of such receipt. HWM will have the right to reject any Order for (a)
failure of SBC to provide all ordering information required by this Agreement
or (b) failure of SBC to allow HWM reasonable time to supply the items
requested. HWM will also have the right to reject an Order which includes
additional unagreed to special terms and conditions. HWM will indicate in its
written acknowledgment to SBC whether the Order was accepted or rejected and,
if rejected, the reasons therefor. Acceptance of any Order by HWM will bind
both
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 42
Agreement No. 980427
SECTION A
Page 41 of 85
parties to honor dates, amounts and other ordering information shown thereon,
including supplemental provisions contained therein.
ORDER OF PRECEDENCE
In the event of a conflict or inconsistency between this Agreement and any
Order, the Order shall control. Except for such Order, the terms of this
Agreement shall not be deemed waived, amended or modified.
PERSONNEL EMPLOYMENT
For the term of this Agreement and for twelve (12) months after termination,
each party agrees that it shall not directly or indirectly, solicit, divert or
hire away, or attempt to solicit, divert or hire away, any agent, or employee
of the other party without prior written consent of the other party.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 43
Agreement No. 980427
SECTION A
Page 42 of 85
PLANT AND WORK RULES
Each party's employees and agents will, while on the premises of the other or
at any other location while performing Services under this agreement for SBC,
comply with all SBC rules and policies, including its "Code of Business
Conduct", a copy of which is available upon request, which prohibits the
possession of any weapon or implement which might be used as a weapon on SBC
properties. Either party will have the right to have the other party removed
and replace personnel which in its opinion is not conforming to its rules or
policies. In addition, the parties agree that, where required by government
regulations, it will submit satisfactory clearance from the U. S. Department of
Defense and/or other federal authorities concerned.
POINTS OF CONTACT
For the purpose of this Agreement the contacts shall be as follows:
HighwayMaster [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
Pacific Bell/Nevada Bell [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.]
SWBT [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
SNET [TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.]
PRICES AND PAYMENT
HWM shall submit invoices for installation charges and for GPS Materials upon
delivery and installation of such GPS Materials to SBC. SBC shall pay such
invoices no later than acceptance, or thirty (30) days from receipt of invoice
whichever occurs later. [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
HWM shall submit monthly invoices for Network Services prorated during the
first month based on the number of days left in the monthly billing cycle
following
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 44
Agreement No. 980427
SECTION A
Page 43 of 85
activation. Subsequent monthly invoices will be provided for each month
following activation.
PRICES AND PAYMENT (CONTINUED)[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.]
The prices shall be as outlined in Appendix II, attached hereto and by this
reference made a part hereof. Specific prices identified as still to be
determined
(TBD) will be identified in a modification to this Agreement as mutually agreed
by the parties. Should a difference occur in the amount invoiced by HWM and
paid by SBC a credit or a debit will be applied to an SBC future invoice.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 45
Agreement No. 980427
SECTION A
Page 44 of 85
PUBLICITY
HWM shall not use SBC's name or any language, pictures or symbols which could,
in SBC's judgment, imply SBC's identity or endorsement by SBC or any of its
employees in any (a) written, electronic or oral advertising or presentation or
(b) brochure, newsletter, book, electronic database or other written material
of whatever nature, without SBC's prior written consent (hereafter the terms in
this clause (a) and (b) shall be collectively referred to as "publicity
matters"). HWM will submit to SBC for written approval, prior to publication,
all publicity matters that mention or display SBC's name and/or marks or
contain language from which a connection to said name and/or marks may be
inferred or implied.
PURCHASE AUTHORIZATION
SBC agrees to place the orders under this Agreement for at least eleven
thousand five hundred (11,500) GPS units at the prices specified in Appendix
II, no later than December 29, 1998. SBC shall have a right to terminate
orders, in which case SBC's liability shall be comprised of and limited to the
following termination charges:
HWM's actual costs of (1) materials, components, and equipment identified to
this Agreement and then in HWM's inventory and engineering work identified to
this Agreement (to the extent that such HWM's purchase orders for such
materials, components , equipment and engineering work are not terminable and
such materials, components , equipment and engineering work are not usable in
HWM's other operations within two (2) months following such date of termination
or expiration), less any salvage value thereof; (2) HWM's actual costs incurred
in procuring such goods and services at the date of expiration or receipt of
notice of termination, less any salvage value thereof; and (3) reasonable
termination charges actually paid by HWM to its suppliers. In no way shall
SBC's total liability for termination of orders exceed twelve million dollars
($12,000,000) if written notice of termination is delivered by September 30,
1998, and twenty million dollars ($20,000,000) if written notice of termination
is delivered after September 30, 1998.
Upon receipt by HWM of notice of termination, title to all materials,
components, or equipment for which SBC is obligated to pay termination charges
under (1), above, shall vest in SBC. HWM shall follow SBC's instructions for
disposition of these items and work. In addition, when payment is made, HWM
shall provide SBC a copy of Software which is developed for SBC.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 46
Agreement No. 980427
SECTION A
Page 45 of 85
PURCHASE PROVISIONS
1. SCOPE
a. Subject to the terms and conditions of this Agreement, HWM
shall provide to SBC such Products and Services as are ordered
by SBC hereunder. As used herein, Services shall include
engineering and installation of Products ordered hereunder and
all other Services provided in connection with the applicable
Products.
2. Each such Order shall be numbered and shall include at least the
following items whenever such item is applicable to the Products and
Services covered by such Order:
a. The date of the Order;
b. The incorporation of this Agreement by reference;
c. A complete list of the products and Services covered by the
Order, specifying, attaching or referencing the quantity,
model number, program name or identification number, and
description for each;
d. The price of each Product and Service, including discounts (if
any), and any additional charges and costs;
e. Shipping instructions;
f. The destination to which the Products will be delivered and
the date and time for scheduled delivery;
g. The scheduled Installation Date;
h. The scheduled performance dates for the Services; and
i. Any special terms and conditions.
Orders shall be shipped complete unless SBC authorizes otherwise, in advance,
by writing.
QUALITY ASSURANCE
SBC expects and requires HWM to have a high quality process operating within
HWM's facilities to which GPS Material purchased hereunder will be subject. SBC
considers ANSI/ASQC Q9001 or ANSI/ASQC Q9002 registration to be of great value
to both the HWM and the SBC, and the HWM is encouraged, but not required, to
seek ANSI/ASQC Q9001 or ANSI/ASQC Q9002 registration if they are not currently
registered. In addition, HWM's Quality Program Specifications are attached
hereto as Appendix VII and by this reference made a part hereof.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 47
Agreement No. 980427
SECTION A
Page 46 of 85
QUALITY ASSURANCE (CONTINUED)
HWM hereby agrees that GPS Material furnished hereunder by HWM will be subject
to:
HWM's quality control activities and procedures, as accepted and
approved by SBC, including but not limited to any performance
measurements, testing, quality process reviews or inspections to
implement such procedures.
When requested by SBC, HWM will at no additional charge:
1. Notify SBC or SBC's Agent when GPS Material is ready for examination
and give SBC or SBC's Agent reasonable opportunity to examine same at
any time prior to the scheduled shipment date thereof.
2. Provide SBC or SBC's Agent with copies of HWM's Quality Manual,
current inspection procedures and product specifications for the GPS
Material furnished hereunder.
3. Maintain and make available to SBC or SBC's Agent the data, including
all information and reports about HWM's quality control procedure,
which demonstrate that the GPS Material meets the specified quality
and reliability requirements.
4. Provide SBC or SBC's Agent, at no charge, with access to HWM's test
equipment, facilities, data and specifications, assistance from HWM's
personnel and sufficient working space to enable SBC or SBC's Agent to
perform said quality assurance examination and/or process surveillance
and/or a review of HWM's total quality program at HWM's facilities.
5. HWM hereby agrees that SBC or its representative may perform a quality
assurance examination/inspection of GPS Material purchased hereunder
at HWM's facility at any time prior to the scheduled shipment date,
and will provide SBC or its representative accessibility to its
facility to do so. Nothing contained herein will affect SBC's rights
hereunder, under any warranty, or under any other provisions of this
Agreement. The purchase of any GPS Material under this Agreement is
subject to SBC's inspection and acceptance after delivery.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 48
Agreement No. 980427
SECTION A
Page 47 of 85
RECORDS AND AUDIT
For the purposes of this Agreement, HWM shall maintain complete and accurate
records of all amounts billable to and payments made by SBC hereunder in
accordance with standard recognized accounting practices. HWM shall retain
such records for a period of three (3) years from the date of final payment for
GPS Material covered by this authorization and maintain reasonable billing
detail for the time specified. HWM agrees to provide reasonable supporting
documentation concerning any disputed amount of invoice to SBC within thirty
(30) calendar days after receipt of written notification of such dispute. HWM
further agrees SBC shall have the right through its accredited representatives
to inspect and audit, during normal business hours, the time and material
charges involved to SBC under this authorization. This right to audit shall be
limited to validating the accuracy of its resources utilized and associated
charges to SBC and expressly excludes records and information pertaining to any
other customers, or HWM's accounting policies or practices. Should SBC request
an audit, HWM will make available the pertinent utilization records and files.
All costs directly attributable to such audit shall be paid by SBC.
REGISTRATION
When GPS Material furnished under this Agreement is subject to Part 68 of the
Federal Communications Commission's Rules and Regulations ("FCC Rules and
Regulations") as may from time to time be amended, HWM warrants that such GPS
Material is registered under and complies with Part 68 of such FCC Rules and
Regulations including, but not limited to, all labeling and customer
instruction requirements. HWM agrees to indemnify and hold SBC harmless from
and against any liability, claims or demands (including costs of defense and
attorneys' fees) that may be made because of HWM's noncompliance with Part 68
of the FCC Rules and Regulations. HWM agrees, at its expense, to defend SBC,
at SBC's request, against such liability, claim or demand, provided , however,
that HWM shall (1) keep SBC fully informed as to the progress of such defense,
and (2) afford SBC, at its own expense, an opportunity to participate on an
equal basis with HWM in such defense.
RELEASES VOID
Neither party shall require waivers or releases of any personal rights from
representatives of the other in connection with visits to its premises, and no
such releases or waivers shall be pleaded by either party in any action or
proceeding.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 49
Agreement No. 980427
SECTION A
Page 48 of 85
RELOCATION
Upon thirty (30) days' prior written notice from SBC, HWM agrees to prepare for
relocation and reinstall GPS Material purchased hereunder at any other site at
SBC's expense. The charge will be as specified in Appendix II, Pricing.
REMEDIES CUMULATIVE
Any rights of cancellation, termination, liquidated damages or other remedies
prescribed in this Agreement are cumulative and are not exclusive of any other
remedies to which the injured party may be entitled, including but not limited
to, the remedies of specific performance and cover; however, neither party
shall retain the benefit of inconsistent remedies.
RESPONSIBILITIES
The basic responsibilities of each party are outlined below.
SBC RESPONSIBILITIES
SBC will:
o Make available upon Agreement execution ten (10) different
types of SBC vehicles to HWM for installation analysis
o Prioritize sites and schedule for installation
o Coordinate schedule for site installation & site coordinators
o Provide contact names and telephone numbers and fully inform
these contacts before being contacted by HWM
o Coordinate to assure that vehicles are available at a ninety
five percent (95%) rate at the designated times and locations
o Assign a program manager for this implementation
HWM RESPONSIBILITIES
HWM will:
o Look at ten (10) different types of SBC vehicles to prepare
for installation
o Provide Installation drawings completed for HWM to start
installations
o Coordinate schedule for site installation & site coordinators
o Train SBC personnel within three (3) days following
Installation Acceptance pending agreement of a training plan
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 50
Agreement No. 980427
SECTION A
Page 49 of 85
RESPONSIBILITIES (CONTINUED)
o Coordinate to assure that vehicles available at a ninety five
percent (95%) rate are installed at the designated times and
locations
o Assign a program manager for this implementation
o Use its best efforts to complete delivery of Phase 1, 2, and 3
requirements by the Delivery Dates specified herein.
RISK OF LOSS
SBC will be relieved from all risk of physical loss, damage or destruction to
the GPS Material during the period the GPS Material is in transit or in the
possession of HWM up to and including the date Acceptance Date thereof, except
for any loss or damage caused solely by the negligence or willful misconduct of
SBC. After the Acceptance Date, SBC will assume all risk of loss, damage or
destruction to the GPS Material, except for any loss or damage caused by the
negligence or willful misconduct of HWM, its agents of employees.
SBC AND HWM INFORMATION
Any specifications, drawings, sketches, models, samples, tools, computer or
other apparatus programs, component lists, HWM lists, pricing lists,
documentation, technical information or business information or data, written,
oral or otherwise (all hereinafter designated "Information"), furnished to one
party by the other under this Agreement or in contemplation hereof will remain
the disclosing party's property. All copies of such Information in written,
graphic or other tangible form will be returned to the disclosing party upon
request. Information will be kept confidential by the parties (including the
agents, employees, and affiliates of each) in performing under this Agreement
and may not be used for any other purposes except upon such terms as may be
agreed upon between HWM and SBC in writing.
SEVERABILITY
If any provision or any part of provision of this Agreement shall be invalid or
unenforceable, such invalidity or non- enforceability shall not invalidate or
render unenforceable any other portion of this Agreement. The entire Agreement
will be
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 51
Agreement No. 980427
SECTION A
Page 50 of 85
SEVERABILITY (CONTINUED)
construed as if it did not contain the particular invalid or unenforceable
provision(s) and the rights and obligations of the HWM and SBC will be
construed and enforced accordingly.
SHIPPING AND BILLING
HWM will at its expense:
1. Ship Orders complete unless instructed otherwise by SBC.
2. Ship to the destination designated in an Order in accordance
with specific routing instructions.
3. Enclose a packing memorandum with each shipment and, when more
than one (1) package is shipped, identify the one containing the
memorandum.
4. Mark the Order number and Product identification on all
packages, subordinate documents and shipping papers.
5. Render invoices showing the Order number, through routing and
weight.
6. Render separate invoices for each shipment or Order.
On written request of SBC, HWM will mail Bills of Lading, shipping notices and
copies of transportation bills with copies of HWM's invoices to the address
indicated on said request.
HWM will limit billing on repair invoices to one (1) invoice per repair Order.
SBC shall reimburse HWM for any transportation charges incurred in delivery of
the GPS Materials to SBC. HWM will include the transportation charges from the
F.O.B. point to the destination as a separate charge on HWM's invoice for the
GPS Materials. Adequate protective packaging will be furnished by HWM at no
additional charge. Shipping and routing instructions may be altered as
mutually
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 52
Agreement No. 980427
SECTION A
Page 51 of 85
SHIPPING AND BILLING (CONTINUED)
agreed upon by HWM and SBC without written notice. C.O.D. shipments will not
be accepted. All claims for monies due or to become due from SBC will be
subject to deductions by SBC for any setoff or counterclaim for monies due or
to become due from HWM, whether under this Agreement or otherwise.
SITE PREPARATION
HWM agrees to furnish to SBC, in writing, GPS Specifications, Installation Site
requirements and HWM's recommendations for Site preparation at least ninety
(90) calendar days prior to the Delivery Date specified in the applicable
Order. The GPS Specifications will contain sufficient detail to ensure that
the GPS Material to be installed will operate efficiently in accordance
therewith. Any changes in GPS Specifications or Installation Site requirements
will be sent to SBC, in writing, at least ninety (90) calendar days prior to
the delivery of any additional units of GPS Material which may be ordered after
the initial Order. SBC will have the Installation Site prepared at no expense
to HWM in accordance with the GPS Specifications furnished by HWM.
Installation Site preparation will be scheduled to be completed at least ten
(10) calendar days prior to the Delivery Date specified in the applicable
Order, subject to the delay provisions of the clause entitled Delivery.
HWM may inspect the Site on the scheduled date for completion of preparation or
immediately after SBC informs HWM that Installation Site preparation is
complete. HWM will promptly report to SBC in writing, the date of the
inspection and any nonconforming conditions.
Any alterations or modifications in Installation Site preparation which are
attributable to incomplete or erroneous GPS Material Specifications,
Installation Site requirements or Installation Site recommendations provided by
HWM will be made by SBC at HWM's expense.
SURVIVAL OF OBLIGATIONS
The obligations of either party to this Agreement which by their nature would
continue beyond the termination, cancellation or expiration hereof, including,
by way of illustration only and not limitation, those in the clauses ENTITLED
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 53
Agreement No. 980427
SECTION A
Page 52 of 85
SURVIVAL OF OBLIGATIONS (CONTINUED)
COMPLIANCE WITH LAWS, INSURANCE, LIABILITY, PUBLICITY, RELEASES VOID,
SEVERABILITY, SBC AND HWM INFORMATION AND WARRANTY, will survive the
termination, cancellation or expiration of this Agreement.
TAXES
HWM will invoice SBC the amount of any federal excise taxes or state or local
sales taxes, if any, imposed upon the sale of GPS Material as separate items,
listing the taxing jurisdiction imposing the tax. Software and all Services
will be separately stated on the applicable invoice. SBC agrees to pay such
amounts to HWM. With respect to services, SBC will pay all applicable taxes
and equivalent government assessments in addition to the pricing set forth in
this Agreement. SBC shall pay, in addition to the charges due hereunder for
the Products and/or Services, all applicable federal, state, local sales, use,
and /or excise taxes or surcharges. HWM will invoice SBC the amount of any
federal excise taxes or state or local sales taxes imposed upon the sale of GPS
Material as separate items, listing the taxing jurisdiction imposing the tax.
SBC agrees to pay such amounts to HWM.
HWM agrees to pay, and to hold SBC harmless from and against, any penalty,
interest, additional tax or other charge that may be levied or assessed as a
result of the delay or failure of HWM, for any reason, to pay any tax or file
any return or information required by law, rule or regulation or by this
Agreement to be paid or filed by HWM. HWM agrees to pay and to hold SBC
harmless from and against any penalty or sanction assessed as a result of HWM
doing business with any country subject to U.S. trade restrictions.
SPECIAL TAX PROVISIONS
The following tax sections shall apply only to sales of products which occur in
the state of California and/or other states where the statutory taxation scheme
imposes the legal obligation to pay state, local and/or municipal sales taxes
upon the seller of products, rather than the buyer of products, and which
allows the seller to contractually shift the legal obligation to pay said
state, local and/or municipal sales taxes to the buyer.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 54
Agreement No. 980427
SECTION A
Page 53 of 85
TAXES (CONTINUED)
a. Upon SBC's request, the parties shall consult with respect to
the basis and rates upon which HWM shall pay any taxes for
which SBC is obligated to reimburse HWM under this Agreement.
If SBC determines that in its opinion any such taxes are not
payable or should be paid on a basis less than the full price
or at rates less than the full tax rate, HWM shall make
payment in accordance with such determinations. If collection
is sought by the taxing authority for a greater amount of
taxes than that so determined by SBC, HWM shall promptly
notify SBC. If SBC desires to contest such collection, SBC
shall promptly notify HWM. If SBC determines that in its
opinion it has reimbursed HWM for sales or use taxes in excess
of the amount which SBC is obligated to reimburse HWM, SBC and
HWM shall consult to determine the appropriate method of
recovery of such excess reimbursements. HWM shall credit any
excess reimbursements against tax reimbursements or other
payments due from SBC if and to the extent HWM can make
corresponding adjustments to its payments to the relevant tax
authority. At SBC's request, HWM shall timely file any claims
for refund and any other documents required to recover any
other excess reimbursements, and shall promptly remit to SBC
all such refunds (and interest) received.
b. Although HWM shall cooperate with and provide reasonable
assistance to SBC, SBC shall direct the conduct of any
proceedings, hearings or litigation involved in any contest
with respect to taxes for which SBC is obligated to reimburse
HWM under this Agreement. SBC shall reimburse HWM for any
taxes, interest, penalties or out of pocket expenses
reasonably incurred with SBC's advance written approval, such
as travel expenses of witnesses appearing in such proceedings,
which HWM may be required to pay because of HWM's complying
with SBC's determinations with respect to the payment of
contesting of any such taxes.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 55
Agreement No. 980427
SECTION A
Page 54 of 85
TAXES (CONTINUED)
c. If any taxing authority advises HWM that it intends to audit
HWM with respect to any taxes for which SBC is obligated to
reimburse HWM under this agreement, HWM shall (1) promptly so
notify SBC, (2) afford SBC an opportunity to participate on an
equal basis with HWM in such audit with respect to such taxes
and (3) keep SBC fully informed as to the progress of such
audit. Each party shall bear its own expenses with respect to
any such audit, and the responsibility for any additional tax,
penalty or interest resulting from such audit shall be
determined in accordance with the applicable provisions of
this Section. HWM's failure to comply with the notification
requirements of this section shall relieve SBC of its
responsibility to reimburse HWM for taxes only if HWM's
failure materially prejudiced SBC's ability to contest
imposition or assessment of those taxes.
TECHNICAL REQUIREMENTS AND SPECIFICATIONS
Product Technical Requirements and Specifications:
The GPS Material and Services shall comply with the GPS Specifications
as described in all Appendices or Exhibits, attached hereto and
incorporated into this Agreement by reference and such other
requirements and specifications as may be mutually agreed to by the
parties.
TERMINATION AND CANCELLATION
If either party is in material breach of an obligation hereunder, the party in
breach shall have the period(s) defined below from the date of written notice
thereof to cure such breach:
1. Prior to completing delivery and installation of Phase 1 requirements,
thirty (30) days from the date of written notice specifying the breach
in sufficient detail, followed by an additional thirty (30) days
after written notice of intent to cancel.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 56
Agreement No. 980427
SECTION A
Page 55 of 85
TERMINATION AND CANCELLATION (CONTINUED)
2. After completing delivery and installation of Phase 1 requirements,
thirty (30) days from the date of written notice specifying the
breach in sufficient detail, followed by an additional forty five (45)
day after written notice of intent to cancel.
If the breach is not cured within such applicable cure period, the party not in
breach may cancel this Agreement.
TIME IS OF THE ESSENCE
HWM understands that SBC's business and operations require the delivery of GPS
Material and the performance of Services hereunder be accomplished in the
period of time and by dates specified in the applicable Order. Therefore, it
is agreed that TIME IS OF THE ESSENCE in the delivery of GPS Material and the
performance of Services. In determining a period of time, the date upon which
action is taken to start the period shall not be counted and the period shall
end with the close of business on the last designated day of the period.
TIMELY PERFORMANCE
If HWM learns of anything that might prevent the timely delivery of the
Products and/or performance of the Services, HWM will immediately notify SBC of
all relevant information concerning the potential delay.
TITLE
Title to GPS Material purchased pursuant to this Agreement will remain in HWM
until the Acceptance Date thereof, at which time title will pass to SBC. Upon
receipt of payment, HWM will furnish SBC a Bill of Sale and all other documents
requested by SBC to enable it to perfect unencumbered title to the GPS
Material.
TRADE-INS
SBC may at any time request HWM to substitute any upgraded or later-developed
GPS Material for GPS Material purchased pursuant to this Agreement. In such
event, HWM may allow a trade-in credit for the old GPS Material toward the
purchase price of the new GPS Material equal to its depreciated value using
straight-line depreciation and a seven (7)-year life.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 57
Agreement No. 980427
SECTION A
Page 56 of 85
TRAINING
HWM will provide SBC, training materials and technical support to enable SBC to
properly and effectively use the GPS Material ordered hereunder.
Training will be provided for a mutually agreed to number of SBC personnel per
course. Initial training will normally be provided prior to or concurrent with
the Installation Date of the GPS Material at each applicable Installation Site;
provided, however, that Acceptance Testing of the GPS Material will not
commence until such training has been provided. Such training will be
conducted at the Installation Site or at other sites selected by SBC, and on
dates which are mutually agreeable to HWM and SBC.
At SBC's request, HWM will provide additional training classes from time to
time at a site selected by SBC or at HWM's site. SBC may also acquire kits of
training materials and may conduct its own courses. SBC will pay for such
additional training classes, or for such kits of training materials, at HWM's
then current standard published charge for such services, less any applicable
discounts. In the event of additional training at SBC's site, reasonable
expenses for travel and lodging for the trainer will be paid by SBC, provided
that reasonable supporting documentation is submitted by HWM therefor.
SBC may reproduce any training material originated by HWM for the purpose of
training SBC's own personnel. Any such reproductions will include any
copyright or similar proprietary notice contained in the items being
reproduced.
TRANSPORTATION
All transportation charges applicable to GPS Material both from and to HWM's
plant are to be paid by SBC; provided, however, that HWM will bear the cost of
transportation for GPS Material (a) shipped for mechanical replacement purposes
covered under any applicable Warranty, (b) removed as a result of GPS Material
failure while covered under any applicable Warranty, whether for the
convenience of HWM or pursuant to a demand by SBC as provided herein, and (c)
removed as a result of a default by HWM of any of the terms and conditions of
this Agreement or any Order.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 58
Agreement No. 980427
SECTION A
Page 57 of 85
TRANSPORTATION (CONTINUED)
HWM will prepay transportation and handling charges for all GPS Material
ordered hereunder and list same as separate items on HWM's invoice therefor.
Transportation charges to ship empty packing cases will be paid by HWM except
when the GPS Material is moved at SBC's request from one SBC Installation Site
to another.
Transportation charges payable by SBC will not exceed the cost of shipment
between SBC's location and the location of HWM's nearest plant of manufacture
of the GPS Material being shipped, regardless of the actual point of origin or
destination of the GPS Material.
SBC will pay only those rigging or drayage costs incurred at SBC's Installation
Site, except when HWM is responsible for payment of transportation charges as
stated above.
UNIVERSAL DESIGN
HWM advocates and supports and encourages its suppliers to advocate and support
the manufacturing and provision of products which embrace the concept of
"universal design". HWM shall use its reasonable efforts to manufacture and
provide products, including future versions of Products, to make it's products
accessible to the widest range of consumers including those with disabilities.
HWM agrees to reasonably cooperate with SBC in addressing disability access
issues, including hearing aid interference, that may arise in connection with
SBC's customer's use of HWM's Products furnished hereunder. Specifically HWM
agrees:
1. to ensure that its equipment is designed, developed and fabricated to
be accessible to and usable by people with disabilities, and
2. to ensure that the service is accessible to and usable to people with
disabilities, or
3. to ensure that the equipment or service is compatible with existing
peripheral devices or specialized customer premises equipment commonly
used by individuals with disabilities to achieve access, if the
requirements of subsection 1 and 2 are not readily achievable.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 59
Agreement No. 980427
SECTION A
Page 58 of 85
WARRANTY
HWM's warranties are based upon the product descriptions of GPS Material
contained in the GPS Specifications agreed upon by SBC and HWM (including any
specifications and demonstrations and drawings) and the demonstrations and
samples previously provided and demonstrated, as well as any other
specifications, drawings, demonstrations and samples that may be referred to or
incorporated in this Agreement or the final agreement between the parties.[Text
has been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.]
HWM warrants to SBC that GPS Material furnished hereunder will be merchantable,
free from defects in design, GPS Material and workmanship, fit and sufficient
for the purposes intended by SBC, free from all liens and encumbrances and will
conform to and perform in accordance with applicable GPS Specifications,
drawings, demonstrations and samples. In addition, if GPS Material contains one
or more manufacturer's warranties, which are permitted to be assigned by their
terms, HWM hereby assigns such warranties to SBC. These warranties will be in
addition to all other warranties, express, implied or statutory. All warranties
will survive inspection, acceptance, payment and use.[Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.]
HWM also warrants to SBC that any services provided hereunder will be performed
in a first-class, workmanlike manner, with the care, skill and diligence, and in
accordance with the applicable standards currently recognized in HWMs profession
or industry. If HWM fails to meet applicable professional standards, HWM will,
without additional compensation, correct or revise any errors or deficiencies in
the Services furnished hereunder.[Text has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed separately with
the SEC.]
GPS Material not meeting the warranties contained herein during the warranty
stated at the bottom of this warranty section, will, at SBC's option, be
repaired, adjusted or replaced by HWM at no cost to SBC. After the [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.] Warranty for Service a time
and material charge will be applied based on HWM service rates identified in the
Agreement. In the event of an emergency out-of-service condition caused by GPS
Material furnished hereunder, HWM agrees to ship replacement GPS Material, if
available, within [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] of
notification by SBC. Such emergency replacement Service shall continue for a
period of [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] after
the expiration of this
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 60
Agreement No. 980427
SECTION A
Page 59 of 85
Agreement. For GPS Materials not covered under warranty, charges for
replacement GPS Material shall be at the current selling price; freight charges
shall be borne by SBC.
WARRANTY (CONTINUED)[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SEC.]
In addition to the warranties stated above HWM warrants the [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.] for a period of [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.] for labor and [Text has been omitted pursuant
to a request for confidential treatment. The omitted material has been filed
separately with the SEC.] for all parts.
Warranties specified herein shall commence from the date of SBC's acceptance of
the applicable GPS Material or Service. [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] warranties shall commence on acceptance of Phase 1
GPS Material and the period shall not be extended as it relates to the [Text
has been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.] by virtue of subsequent
Software modifications.
WORK DONE BY OTHERS
If any part of the work is dependent upon work done by others, HWM shall
inspect and promptly report to SBC any defect that renders such other work
unsuitable for HWM's proper performance. HWM's silence shall constitute
approval of such other work as it is fit, proper and suitable for HWM's
performance of the work. HWM shall be entirely responsible for all persons
furnished by HWM working in harmony with all others when working on SBC's
premises.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 61
Agreement No. 980427
SECTION A
Page 60 of 85
WORK HEREUNDER
It is understood that visits by representatives of HWM or its suppliers for
inspection, adjustment or other similar purposes in connection with GPS
Material purchased hereunder will for all purposes be deemed "work hereunder"
and will be at no charge to SBC unless otherwise agreed in writing with SBC.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 62
Agreement No. 980427
SECTION A
Page 61 of 85
SECTION B - SOFTWARE LICENSE
GENERAL
HWM agrees to supply to SBC, under the terms and conditions set forth in this
Agreement, all Software and associated Documentation specified in an Order
submitted to HWM pursuant hereto.
GRANT OF LICENSE
HWM hereby grants to SBC a perpetual, non-exclusive, irrevocable, royalty-free
Enterprise License/Site License/CPU License (the "License") to use the Software
Products specified in Orders for any business purpose of SBC or its Affiliated
Companies. No right of sublicense is granted to SBC.
SBC may also alter tables and other user modifiable parameters as provided in
the GPS Specifications applicable to the Software Products. SBC shall also
have the right to create copies of machine readable Software Products and any
source code provided or acquired hereunder for backup and recovery purposes.
All materials developed or produced by SBC through use of the Software Products
shall remain the property of SBC and/or Affiliated Companies. SBC shall not
use, print, copy, modify, translate, alter, decompile, reverse engineer or
display the Software Products, in whole or in part, except as expressly
provided for in this Agreement.
DOCUMENTATION UPDATES
HWM agrees to provide updates to Documentation furnished to SBC hereunder which
is related to the use and support of the Software. HWM will also provide
periodic newsletters concerning the programs, Software enhancements,
programming notes, and Documentation corrections to the SBC liaison support
associated with such Software.
In the event of an emergency out-of-service condition caused by defective
Software or a disaster or other occurrence wherein SBC's copy of such Software
is destroyed or rendered unusable, HWM agrees to ship a replacement copy of the
current version of such Software as installed at SBC's Installation Site(s)
within two (2) workdays of verbal notification by SBC. HWM also agrees that
there will be no charge to SBC for such replacement copy of the Software, other
than the cost of the media upon which the Software resides.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 63
Agreement No. 980427
SECTION B
Page 62 of 92
ERROR CORRECTIONS
HWM will supply code corrections to correct errors or malfunctions in the
Software which cause such Software to either be unavailable for use by SBC or
fail to meet the applicable GPS Specifications therefor. Errors may be
reported to HWM by SBC either verbally or by written notice to HWM's Customer
Care Center located in Richardson, Texas at 1(800) 647- 6693. HWM will notify
SBC in writing of the existence of any significant error relating to SBC's
processing environment or use of the Software within forty-eight (48) hours
after the error is brought to its attention.
The error correction procedures will be designed to correct errors in the
Software in accordance with the following levels of error severity assigned by
SBC based on the following conditions:
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
*NOTE Resolution of intermittent error conditions will be handled on a
case-by-case basis.
HWM will correct any and all errors in Software in accordance with error
severity levels as described in this Clause, regardless of the source of
notification. If HWM determines that such errors cannot be corrected within
the specified intervals, HWM will immediately initiate an escalation procedure
to:
a. Immediately assign sufficiently skilled personnel to correct the
error.
b. Immediately notify HWM's senior management personnel that such
error has not been corrected and that the escalation procedure
has been activated.
c. Provide weekly written status reports of outstanding uncorrected
error to SBC.
If any Software error cannot be corrected by HWM in accordance with this
clause, HWM agrees to grant to SBC, on the next maintenance invoice, a
malfunction credit calculated separately for each error severity level as
follows:
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 64
Agreement No. 980427
SECTION B
Page 63 of 92
ERROR CORRECTIONS (CONTINUED)
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
FORM OF ORDER
An Order for Software will be written on SBC's Order form and will contain the
following information, if applicable:
1. The incorporation by reference of this Agreement.
2. The Installation Site(s).
3. The type of License (perpetual/annual).
4. The charge for the License being granted.
5. The date by which the Software will be delivered.
6. Data processing equipment model number and, if already
installed, its serial number.
7. Any special terms and conditions agreed upon by the parties.
INSTALLATION OF SOFTWARE
If requested by SBC in the applicable Order, HWM agrees to install the
Software, at the Installation Site designated therein, at no charge to SBC.
Installation of the Software by SBC or HWM will consist of a version that will
perform in accordance with the corresponding published performance GPS
Specifications therefor and will include a demonstration of the Software's
features and functions using HWM's standard demonstration procedure of the
installed Software on SBC's computer system.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 65
Agreement No. 980427
SECTION B
Page 64 of 92
INSTALLATION OF SOFTWARE (CONTINUED)
The purpose of the installation demonstration will be to confirm that all
Software ordered has been entered into SBC's program library and that such
Software functions in accordance with HWM's published performance GPS
Specifications associated therewith. The demonstration will be considered to
be successfully completed when the Software output results match the standard
set of results provided by HWM.
If HWM installs the Software, HWM will certify in writing to SBC, at the
successful completion of the installation demonstration, that the Software has
been properly installed and performs in accordance with HWM's published
performance GPS Specifications applicable thereto. If SBC installs same, HWM
agrees to provide complete installation instructions with the Software and
telephone consultation, during HWM's business hours, on the proper installation
thereof at no additional charge to SBC.
SOFTWARE PRODUCT DELIVERY AND INSTALLATION
For each Software Product, HWM shall deliver, at no additional charge, at least
the following basic materials:
1. Executable Software.
2. System implementation instructions and required procedures.
3. User instructions.
4. Sample data.
5. Any other programs, routines, subroutines or related material
HWM has or may develop necessary for the general use of the
Software Products which are normally furnished to users of the
Software Products at no charge.
6. Documentation and GPS Specifications associated with the
Software Products.
7. Complete installation instructions.
No Software Products under any Order shall be deemed to be delivered until all
Software Products required by that Order have been delivered, unless otherwise
agreed between the parties. HWM also agrees to provide, at no additional
charge, telephone consultation as necessary during HWM's normal business hours,
on the proper installation of the Software Products. In addition, upon
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 66
Agreement No. 980427
SECTION B
Page 65 of 92
PRODUCT DELIVERY AND INSTALLATION (CONTINUED)
request by SBC, HWM agrees to install the Software Products at SBC's
location(s) for no additional charge.
SBC may exchange Software Products, at no charge, for an alternative, generally
available version of the Software Products for use on different platforms or
operating systems. In order to exchange, SBC must certify to HWM in writing
that all existing copies of the version of the Software Products to be replaced
have been returned or destroyed, except for archival copies which are
impractical to remove from SBC's backup tapes. In addition, SBC shall certify
to HWM in writing that use of the replaced Software Products shall cease
(except if use is required due to a regulatory proceeding as provided below).
Software Products shall be delivered to the site(s) specified on the Order.
SBC may copy the Software Products as necessary to distribute to SBC's various
platforms.
RELOCATION OF SOFTWARE
SBC may redesignate the location at which the Software will be installed, and
will notify HWM of such new location and the effective date of the
redesignation. Concurrent operation of the Software at a second location for a
period not to exceed six (6) months for the purpose of redesignating the
assigned using location will not require an additional license or charge. The
term "location" or "Installation Site" as used herein will mean each facility
designated by SBC on each particular Order at which the Software is to be
installed.
The License granted under an Order for a designated Installation Site may be
transferred: (a) to a back-up location if the computer(s) at the designated
Installation Site is/are inoperative due to malfunction, to performance of
preventative maintenance, to engineering changes or to changes in features or
model, until such computer(s) is/are restored to operative status and
processing of the data already entered in the computer(s) at the back-up
location has been completed, or (b) to one other location for assembly,
compilation or use of the Software if the specifications of the computer(s) at
the designated Installation Site are such that the Software cannot be assembled
or compiled thereon.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 67
Agreement No. 980427
SECTION B
Page 66 of 92
RETURN OF SOFTWARE
Except as otherwise provided herein, SBC agrees to certify to HWM in writing,
within thirty (30) days after the termination or cancellation of any License
Order (except in the event of termination or cancellation due to default by
HWM), that use of the Software licensed thereunder shall cease (except if use
is required due to a regulatory proceeding as provided herein) and that the
original and all copies of all Software licensed thereunder have been destroyed
or returned to HWM. If continued use is required due to a decision or order of
a regulatory body, SBC shall notify HWM and make arrangements for necessary use
of the Software. However, any output created or generated through use of the
Software shall remain the property of SBC, and it shall not be returned to HWM.
RIGHT TO REPRODUCE MATERIAL AND DOCUMENTATION
SBC will have the right to reproduce all printed material, Documentation and
all machine-readable Software supplied by HWM hereunder, provided that such
reproduction of printed material and Documentation is made solely for SBC's
internal use. Any such reproductions will include any HWM notice contained in
the original items being reproduced.
In the case of severe Equipment failure, SBC may transfer this copy to
temporary Equipment. Any copies will be removed from the temporary Equipment
when the Equipment or Software is restored to its pre-emergency specifications.
RISK OF LOSS
If any Software is lost, damaged or made invalid during shipment or prior to
acceptance, HWM will promptly replace the Software and Software storage media
at no additional charge to SBC.
If any Software is lost or damaged while in the possession of SBC after
acceptance, HWM will promptly replace the Software at the established charge
for the Software storage media unless such media is provided by SBC.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 68
Agreement No. 980427
SECTION B
Page 67 of 92
SOFTWARE UPDATES
HWM agrees to supply improvements, new releases, updates, extensions, and other
changes to Software ordered hereunder which (a) HWM provides to other customers
who have a license to use such Software, (b) HWM deems to be logical
improvements or extensions to the original Software supplied to SBC, or (c) are
necessary for the Software to continue their computing functions as mutually
agreed upon between HWM and SBC. SBC will have the right to accept or reject
any such revised version of the Software or to remove same and replace it with
the previous version if such new version will degrade or impair SBC's computer
system. In addition, HWM will insure that Software licensed hereunder is kept
current with new releases of the operating system(s) listed in HWM's standard
published GPS Specifications.
HWM agrees to provide SBC a reasonable amount of mail and telephone consulting
assistance in the event that difficulties occur in the use of the Software or
in SBC's interpretation of the results of Software use. Upon notification by
SBC that such consulting service is required, HWM will proceed promptly toward
the resolution of all such reported problems by using and coordinating whatever
HWM resources are required to resolve the problem.
If such problem cannot be resolved by telephone or written communication within
thirty (30) days from the time SBC first contacts HWM, then if requested by
SBC, HWM will provide an employee, capable of resolving such problem at the
applicable SBC Installation Site for no additional charge, provided that the
problem is the failure of the Software to perform to general GPS Specifications
previously provided to SBC or to GPS Specifications contained in the then
current applicable Software GPS Specifications. If the error or malfunction
causes downtime on SBC's computer system on which the Software is installed,
then HWM will proceed promptly to resolve the problem.
In the event that a problem is found to be due to (a) a modification to the
Software made by SBC or (b) use of the Software in a manner which is not in
accordance with the instructions provided by HWM to SBC relating to use of the
Software, SBC agrees to pay HWM for all Technical Support or Services performed
to resolve or investigate the particular problem at HWM's then current
published standard time and material rates and reimburse HWM for any related
expenses incurred, provided that such expenses are reasonable and HWM furnishes
to SBC supporting documentation therefor.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 69
Agreement No. 980427
SECTION B
Page 68 of 92
SOURCE AVAILABILITY AND SOURCE CODE ESCROW
CODE & DOCUMENTATION ESCROW
A. GENERAL TERMS. The following Code and Documentation escrow provisions
shall apply to (1) any Code and Documentation of the Software provided as part
of the GPS Materials provided to SBC pursuant to this Agreement including
mobile unit software, host communications handler software; and (2) any Code
and Documentation for software utilized by HWM's Network Service Center to
provide enhanced switching services in connection with the GPS Materials (the
"Deposited Code and Documentation"). However, these escrow provisions shall
not apply to any software which is owned by a third party (the "Licensed
Materials"). SBC shall be able to use any intellectual property for its
purposes to enable SBC to continue to provide the functionality described in
the GPS Specifications and various call flows to perform all functionality and
services including any modifications to the Software to effect the use of the
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] Such escrow shall
occur regardless of whether payment has been made, or a dispute between the
parties is in progress. For purposes of this Section, the term "Code" shall
include:
1. CODE. Computer programming code. If not otherwise specified, Code
shall include both Object Code, Source Code and Compiler
Code/Compilation Programs. Code shall include any Maintenance
Modifications, and/or Enhancements created by HWM from time to time.
2. OBJECT CODE. The machine-readable form of the Code.
3. SOURCE CODE. The human-readable form of the Code and related
system documentation including all comments and any procedural code
such as job control language.
4. COMPILER CODE/COMPILATION PROGRAMS. All programs needed to compile
the source code to object code language.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 70
Agreement No. 980427
SECTION B
Page 69 of 92
SOURCE AVAILABILITY AND SOURCE CODE ESCROW (CONTINUED)
CODE & DOCUMENTATION ESCROW (CONTINUED)
B. ESCROW DEPOSIT. HWM will provide the Deposited Code and Documentation
to an escrow agent to be mutually selected by HWM and SBC. HWM will maintain
the Deposited Code and Documentation current with a filing delay of no more
than sixty (60) days following development of such Deposited Code and
Documentation related to any maintenance modifications and/or enhancements.
C. PAYMENT OF ESCROW AGENT FEES. HWM shall be responsible for and pay
any and all fees due to the escrow agent in connection with said escrow
agreement.
D. AVAILABILITY OF DEPOSITED MATERIALS TO SBC. The escrow agent shall
release, upon actual receipt of written notice from SBC and/or HWM, the
Deposited Code and Documentation to SBC if any of the following conditions
occurs subject to the resolution of any objections to the delivery thereof
served by HWM as specified below herein: (1) an assignment by HWM for the
benefit of creditors; (2) the filing of a petition in bankruptcy by HWM; (3)
the filing of creditors of HWM of a petition in bankruptcy against HWM which is
not stayed or dismissed within ninety (90) days; (4) the appointment of a
receiver over the assets of HWM; (5) the parties reasonable disagreement with
respect to the charges to be paid by SBC to HWM under this Agreement (6) HWM's
material breach of this Agreement; and/or (7) HWM's decision to cease
conducting the business which is the subject of this Agreement. The escrow
agent shall serve HWM with fifteen (15) days prior written notice before
delivering the Deposited Code and/or Documentation to SBC so that HWM may have
a reasonable opportunity to serve upon the escrow agent its written objections
to delivery thereof to SBC. In the event that a dispute arises as to whether
any of the foregoing conditions has been met, the escrow agent shall
immediately appoint a mutually acceptable neutral third party arbitrator, with
expertise in intellectual property and contract law, who will, no later than
three (3) weeks after the initial demand of SBC for the release of the
Deposited Code and Documentation, direct the escrow agent to hold or release
the applicable portion of the Code and/or documentation according to the
arbitrator's sole interpretation of this Agreement, the Source Code Escrow
Agreement, and any exhibits thereto.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 71
Agreement No. 980427
SECTION B
Page 70 of 92
SOURCE AVAILABILITY AND SOURCE CODE ESCROW (CONTINUED)
CODE & DOCUMENTATION ESCROW (CONTINUED)
E. CONDITIONS OF DELIVERY. The Deposited Code and Documentation, if and
when delivered to SBC shall be delivered subject to the following terms and
conditions:
1. SBC will have no right to make copies of, or to license or
sublicense, the Deposited Code and Documentation, other than the
rights which SBC has been granted to license or sublicense the same in
this Agreement.
2. SBC shall acquire no rights in the Deposited Code and
Documentation delivered by the Escrow Agent other than the license
rights granted by this Agreement and shall utilize the Deposited Code
and Documentation solely for the purpose of performing and/or
completing a maintenance and support of the applicable Licensed
Materials.
3. SBC shall keep the Deposited Code and Documentation at a
single location at SBC's Corporate Headquarters and will have a right
to use only one (1) copy of the Deposited Code and Documentation, with
the backup copy to be permanently stored as required below.
4. SBC's right to use the Deposited Code and Documentation will
be strictly limited to maintenance and support of the applicable
licensed Materials.
5. Except when actually being utilized for its permitted
purposes, the Deposited Code and Documentation will be kept in a
highly restricted limited access area with access thereto limited to
designated personnel who have a need to use the Deposited Code and
Documentation for the purposes permitted hereunder. The Deposited
Code and Documentation will be otherwise similarly protected by SBC in
a manner consistent with the manner in which it protects its own
highly confidential Intellectual Property (but no less than reasonable
manner), for the duration of time necessary to complete such permitted
purpose.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 72
Agreement No. 980427
SECTION B
Page 71 of 92
SOURCE AVAILABILITY AND SOURCE CODE ESCROW (CONTINUED)
CODE & DOCUMENTATION ESCROW (CONTINUED)
6. All designated personnel with access to the Deposited Code and
Documentation will (i) be advised in writing of the trade secret and
confidential nature of the Deposited Code and Documentation and HWM's
proprietary interest therein; and (2) previously have agreed to comply
with written confidentiality restrictions substantially similar to the
confidentiality restrictions set forth in this Agreement.
7. SBC shall immediately return the Deposited Code and
Documentation, and copies thereof within its possession or control, to
HWM or the escrow agent when SBC no longer requires the Deposited Code
and Documentation for support or maintenance purposes.
SOURCE CODE
If the applicable Order requires HWM to provide SBC with source code to the
licensed Software, HWM shall, prior to the Performance Date and at no
additional charge to SBC, provide SBC with a complete copy of the source code
for the Software and any other information necessary to enable SBC to maintain
the Software. During the license term HWM shall promptly provide SBC with
copies of any changes in or additions to such source code or other information.
Unless HWM has already provided SBC with a copy of current version of the
source code for the Software HWM shall, within ten (10) days after HWM's
receipt of SBC's written request therefor and at no additional charge, provide
SBC with a complete copy of the current version of the source code for the
Software hereunder and any other information necessary to enable SBC to
maintain the Software. SBC shall thereafter have a perpetual royalty-free
right to use the source code for the limited purpose of maintaining the
Software and for the purposes specified by modifications hereto.
STANDARD OF PERFORMANCE
If the Software, when operated by SBC's personnel during the Acceptance Test
for the specified Acceptance Period, operates in conformance with the mutually
agreed upon GPS Specifications, it will be deemed to have met the GPS
Specifications.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 73
Agreement No. 980427
SECTION B
Page 72 of 92
TITLE
Title to Software will remain in HWM. SBC will have the right to make a
reasonable number of copies of the Software for use as authorized in an Order.
USE OF THE SOFTWARE
HWM agrees that Software licensed hereunder may be used by any present or
future subsidiary, affiliate or parent corporation of SBC, whether the use be
carried out on site or by remote electronic access, and that all materials
developed by SBC will remain the property of SBC.
SBC will not use, print, copy, modify, translate, alter or display the
Software, in whole or in part, except as expressly provided for in this
Agreement. Further, SBC will not reverse compile, decompile or reverse
engineer any Software and any attempt to do so will be a breach of this
Agreement.
USE OF PLATFORMS
HWM agrees and promises to use the applicable platforms on which Software
Products are installed only for the purposes of installing, maintaining, or
otherwise supporting the Software Products. Any other use of such platforms
shall constitute a breach of this Agreement.
WARRANTY [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] HWM
hereby represents and warrants to SBC as follows:[Text has been omitted pursuant
to a request for confidential treatment. The omitted material has been filed
separately with the SEC.] 1. It has the right to grant to SBC a license to use
the Software Products set forth in each Order issued hereunder.
2. All Software Products furnished or developed under this Agreement
(including custom Software Products) shall be (i) free from defects
in material and workmanship, (ii) substantially conform to and
perform in accordance with HWM's then current published GPS
Specifications, and (iii) operate satisfactorily in the system
environment in which the Software Products are initially installed.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 74
Agreement No. 980427
SECTION B
Page 73 of 92
WARRANTY (CONTINUED)
3. Except as disclosed in the GPS Specifications appended to this
Agreement, the Software Products licensed hereunder contain no
"computer viruses", other "contaminants", including any codes, or
instructions that may be used to access, modify, delete, damage, or
disable SBC's computer system. If any "third party" software of other
vendors is incorporated into the Software Products furnished by HWM
hereunder, HWM shall obtain comparable warranties enforceable by SBC
from such vendors.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
5. HWM warrants that the Software does not contain any disabling code
which would render the Software Products unusable until a patch or new
password is entered on the machine for which it is licensed.
6. HWM warrants for a period of [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been
filed separately with the SEC.] from furnishing a Software Product
that any magnetic medium on which portions of a Software Product are
furnished shall be free from defects in material, workmanship or
recording.
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE
OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 75
Agreement No. 980427
SECTION B
Page 74 of 92
WARRANTY (CONTINUED)
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
8. HWM agrees to perform the Services in a first-class, workmanlike
manner, with care, skill and diligence, and in accordance with
applicable standards currently recognized by HWM's profession. HWM
further agrees to be responsible for the professional quality,
technical accuracy, completeness and coordination of all reports,
designs, drawings, plans, information, specifications and other items
and Software Products (including custom Software Products) and Services
furnished under this Agreement. If HWM fails to meet applicable
professional standards, HWM will, without additional compensation,
correct or revise any errors or deficiencies in its reports, drawings,
specifications, designs or other items or Software Products and
Services furnished hereunder.
9. [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the
SEC.]Generally available Software Products will contain, at a minimum,
the same functions and features as the associated Beta Test copy of
such Software Products.
The above warranties (except for the warranties contained in paragraphs 1 and
6) shall be effective for a period of [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] of the Software Products and/or the rendering of the
Services to SBC. The warranty contained in paragraph 1 shall be effective
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] HWM agrees to
correct, replace or credit, at SBC's sole option and at HWM's sole expense, any
non-conforming Software Product which is due to errors, malfunctions, or the
acts or omissions of HWM, its employees or agents. In addition, pursuant to
paragraph (6), HWM agrees to replace any defective media at no charge to SBC
during the [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
warranty period.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 76
Agreement No. 980427
SECTION C
Page 75 of 85
SECTION C - GPS MATERIAL MAINTENANCE SERVICES
GENERAL
HWM agrees to provide maintenance service on GPS Material acquired hereunder by
SBC upon the terms and conditions set forth in this Agreement and in Orders
placed by SBC pursuant to this Section and accepted by HWM. Such Orders will
be deemed accepted by HWM provided the Orders are in conformance with this
Section. Prices for parts and HWM's hourly rates are included in Appendix II.
ACCESS
SBC will provide HWM with reasonable access to the GPS Material to perform
maintenance service.
BASIC SERVICE
HWM agrees to perform the following basic maintenance service: accomplish
regularly scheduled Preventive Maintenance, if applicable; update the GPS
Material to provide the latest reliability improvements; respond to requests
for and accomplish Remedial Maintenance during the Principal Period; supervise
the preparation of the GPS Material for movement and set-up after movement; and
provide all tools and test equipment necessary for the maintenance of the GPS
Material. There will be no maintenance charges for the following basic
maintenance services if performed during the applicable warranty period and if
the malfunction or inoperative condition is covered under the applicable
warranty:
1. Preventive Maintenance, unless performed outside the Principal
Period, which will include, for purposes of this paragraph, the
mutually agreed to scheduled time for Preventive Maintenance.
2. Remedial Maintenance which was begun during the Principal Period
or an extension thereof or when HWM was notified during the
Principal Period or extension thereof of the need for Remedial
Maintenance.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 77
Agreement No. 980427
SECTION C
Page 76 of 85
BASIC SERVICE (CONTINUED)
3. Remedial Maintenance required within a thirty (30) day period
due to a recurrence of the same malfunction.
4. Time spent by maintenance personnel after arrival at SBC's Site
awaiting the arrival of additional maintenance personnel and/or
delivery of parts, etc., after a service call has commenced.
5. Remedial Maintenance required when the scheduled Preventive
Maintenance preceding the malfunction had not been performed.
6. Parts required for Preventive or Remedial Maintenance, including
replacement parts.
7. Remedial Maintenance performed outside the Contracted Period of
Coverage, unless specifically agreed otherwise by SBC in
writing.
When so agreed, SBC will pay for Remedial Maintenance requested to be performed
outside of the Contracted Period of Coverage at HWM's published rates;
relocation of GPS Material within a SBC location during the Contracted Period
of Coverage; unpacking, installation and Acceptance Tests, any GPS Material
certification for maintenance, and packing, removal and supervising the removal
or moving of any GPS Material.
Preventive Maintenance, if applicable, will be performed at mutually agreed
upon times which do not unreasonably interfere with SBC's use of the GPS
Material. HWM will specify in writing the frequency and duration of the
Preventive Maintenance required for the GPS Material, and SBC will specify the
Preventive Maintenance schedule which may be modified by mutual agreement.
ENGINEERING CHANGES
Engineering changes which are made to GPS Material after its manufacture will
be incorporated by HWM into the GPS Material at SBC's site. These changes will
be incorporated only after consultation with and scheduling by SBC. Time
required for any modifications or engineering changes will be subject to the
provisions hereof relating to maintenance credit for downtime. In addition,
HWM will, during such consultation, specify any related products which may be
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 78
Agreement No. 980427
SECTION C
Page 77 of 85
ENGINEERING CHANGES (CONTINUED)
affected by such engineering changes. All modifications will be subject to the
provisions of the Clause entitled ACCEPTANCE.
There will be no charge for the installation of engineering changes due to
Warranty covered defects on GPS Material or a recall of the GPS Material for
safety related defects.
ESCALATION PROCEDURE
HWM will endeavor to initiate on-site remedial Service at SBC's site within the
specified response time. If the trouble has not been corrected within six (6)
hours after SBC's request for Service, HWM's support center personnel will
initiate an escalation process to provide HWM's regional engineering
assistance. If the trouble has not been corrected within twelve (12) hours
after SBC's request, the problem will be escalated to HWM's engineering control
center. No charge will be made for any such escalation.
FORM OF ORDER
Orders for GPS Material maintenance will be written on SBC's forms and will
contain the following information:
1. The incorporation by reference of this Agreement.
2. A complete list of the GPS Material to be serviced, specifying
quantity, type, description, the monthly maintenance charge for
each item of GPS Material, the term of the Order and the total
annual/monthly maintenance charges payable by SBC.
3. The location at which the GPS Material is installed, including
floor, street, city, state and zip code.
4. The designation of a point of contact at which HWM's maintenance
representative will receive notification of GPS Material
failure.
5. The Principal Period, or extension thereof, selected by SBC.
6. Any special terms and conditions agreed upon between the
parties.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 79
Agreement No. 980427
SECTION C
Page 78 of 85
MAINTENANCE BY OTHERS
SBC will not knowingly permit persons other than authorized representatives of
HWM to perform maintenance or attempt repairs to any GPS Material while that
GPS Material is covered by maintenance provided by HWM hereunder, unless
otherwise agreed by HWM.
MAINTENANCE LOG
HWM agrees to maintain a legible maintenance log at each Installation Site
which will be made available to SBC for inspection upon request. This log will
include, at a minimum, the following:
1. The date and the time HWM was notified.
2. The date and time of HWM's arrival.
3. The time the GPS Material was made available to HWM.
4. The type and model number(s) of the GPS Material.
5. A description of the malfunction.
6. The time spent for repair.
7. The corrective action taken, including parts used.
8. The time the GPS Material was made available to SBC.
9. Applicable charges, if any.
10. Identification of HWM's representative.
11. SBC's representative's signature.
PARTS
There will be no additional charges for replacement parts during the covered
warranty period. Only new standard parts or parts of equal quality will be
used in effecting repairs. Parts which have been replaced will become the
property of HWM and will be removed from SBC's Site. Parts which are installed
on purchased GPS Material will become the property of SBC.
PARTS INVENTORY
HWM agrees to maintain a sufficient supply of spare parts at SBC's Site to make
emergency repairs.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 80
Agreement No. 980427
SECTION C
Page 79 of 85
REMEDIAL MAINTENANCE
Remedial Maintenance will be performed after notification to HWM that the GPS
Material is inoperative. HWM will furnish SBC with a designated point of
contact for such notification. During the Principal Period, or extension
thereof, set forth in the applicable Order, HWM agrees to have a Field Engineer
arrive at SBC's Site within twenty-four (24) hours after notification that
Service is required. Outside such Principal Period, or extension thereof, HWM
will use its best efforts to have its Field Engineer arrive at SBC's Site
within twenty-four (24) hours after notification that Service is required.
Such Service calls will be made at HWM's then current standard per-call rates.
Only one (1) Field Engineer will respond to a request for maintenance outside
of the Principal Period or extension thereof, unless it is mutually agreed that
more than one (1) Field Engineer is required.
The Principal Period or extension thereof may be changed by SBC upon thirty
(30) days' prior written notice to HWM.
Separate Principle Periods of Maintenance may be specified when there are two
(2) or more installations of HWM provided GPS Material at the same Site.
In the event that HWM finds itself unable to meet the standards set forth above
in responding to SBC's maintenance requests, HWM will, in consideration of the
size of the installed base, locate a Field Engineer within a fifty (50) mile
radius of SBC or, upon the reasonable request of HWM, SBC may provide office
space for such Field Engineer at SBC's Site.
STORAGE AND WORK SPACE
SBC will provide at no charge to HWM space for spare parts and working space,
including heat, light, ventilation, electric current and outlets for use by
HWM's maintenance personnel. These facilities will be located at SBC's site
within a reasonable distance of the GPS Material to be maintained. HWM will
maintain this space in an orderly manner, consistent with SBC's site rules.
SBC will not be liable for loss or damage to HWM's equipment or materials
stored on SBC's site.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 81
Agreement No. 980427
SECTION C
Page 80 of 85
TERM OF ORDER
The maintenance term will commence on the date set forth in the applicable
Order (but in no event earlier than the expiration of the warranty period for
the GPS Material involved) and continue for the initial maintenance term
specified therein and thereafter until canceled or terminated by SBC as
provided herein.
TIME AND MATERIAL
From time to time SBC may require Maintenance on GPS Material not covered under
a Maintenance Order. In these cases SBC will notify HWM of the problem and HWM
will provide assistance on a time and material basis. HWM will provide an
invoice to SBC for the services performed and SBC will make payment thirty (30)
days from the receipt of the invoice.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 82
Agreement No. 980427
SECTION D
Page 81 of 85
SECTION D - HWM NETWORK SERVICES
GENERAL
This Section sets forth the terms and conditions relating to collection and
delivery of data by HWM as well as the specific Services provided for the
monthly fee listed in Appendix II, Pricing.
SCOPE OF RESPONSIBILITY
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
SCOPE OF RESPONSIBILITY (CONTINUED)
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
NETWORK SERVICE TERMS
a SERVICES PROVIDED. [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
b AVAILABILITY OF SERVICE.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
c SERVICE COMMITMENT. [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
SCOPE OF RESPONSIBILITY (CONTINUED)
NETWORK SERVICE TERMS (Continued)
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.
THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.]
d RATES, CHARGES, BILLING AND PAYMENT FOR SERVICES. HWM will render to SBC
a monthly combined bill for the Enhanced Services and Enhanced
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 83
Agreement No. 980427
SECTION D
Page 82 of 85
Cellular Roaming service with each listed separately. SBC will receive a
paper bill unless electronic media is requested. SBC agrees to accept
responsibility for all calls made by SBC or its authorized users. The
rates for all services hereunder effective on the date of this Agreement
are set forth in this Agreement. Payment shall be due net thirty (30)
after receipt of invoice. All service fee payments shall be due and
payable to HWM Corporation at P.O. Box 970779, Dallas, Texas, 75397-0779.
e TAXES, DUTIES & SURCHARGES FOR SERVICES. All service charges are subject
to federal, foreign, state and/or local excise, sales, use, property,
retailers, occupation or other taxes, duties or surcharges. If any
governmental tax, duty or surcharge is determined to be applicable, then
SBC shall pay to HWM the full amount of any such tax, duty or surcharge at
the time payment is due for other charges pursuant to paragraph d above
herein.
f NONPAYMENT OF SERVICE FEES. A late payment charge of ten dollars ($10.00)
or one and one-half (1 1/2) percent of the outstanding balance, whichever
is higher, shall be assessed on a monthly basis on payments not paid by the
due date.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 84
Agreement No. 980427
SECTION D
Page 83 of 85
SCOPE OF RESPONSIBILITY (CONTINUED)
NETWORK SERVICE TERMS (CONTINUED)
g PRIVACY OF COMMUNICATION. In rendering service under this Agreement,
HWM will make reasonable efforts to protect the privacy of SBC's
communications. However, absolute privacy of communications is not
guaranteed. SBC acknowledges that wireless communications, including
cellular, satellite and other transmissions, are subject to
interceptions by parties possessing certain types of radio equipment
without the knowledge or permission of the user.
h LIMITED WARRANTY FOR SERVICES. During the duration of this Agreement,
HWM warrants that the Enhanced Services provided during Phases I, II
and III shall operate in good working order and that the Enhanced
Cellular Roaming services provided only during Phase I shall be in good
working order and available to SBC's vehicles equipped with Mobile
Communications Unit(s) when within the service areas of cellular
carriers offering cellular services to HWM.
i LIMITATION OF LIABILITY AND EXCLUSIVE REMEDY FOR SERVICES. SBC agrees
that the liability of HWM, if any, for interruptions, delays, and
failures in transmission of service ("service problems") to SBC (except
for SBC's own negligence or misconduct, for which SBC shall be solely
liable), is limited solely to the allowance of a credit as specified in
the Grade of Service section of this Agreement.
j REGULATORY STATUS. HWM and SBC acknowledge that HWM is a private
enhanced services provider, and that HWM's provision of the Enhanced
Services and its obtaining for SBC the Enhanced Cellular Roaming, are
in no way intended to impute to HWM the regulatory status of
telecommunications common carrier. To the extent the telecommunications
services addressed by this Agreement are provided to SBC by third party
telecommunications companies, HWM and SBC acknowledge that only the
third party telecommunications company providing such services may be
construed, if applicable, as a telecommunications common carrier. To
the extent federal, state, or local laws or regulations change or are
interpreted otherwise, SBC agrees to execute any reasonable retroactive
modification
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 85
Agreement No. 980427
SECTION D
Page 84 of 85
SCOPE OF RESPONSIBILITY (CONTINUED)
NETWORK SERVICE TERMS (CONTINUED)
to this agreement which does not affect the nature or cost of the
service, to the extent necessary to protect HWM against unfavorable
regulatory classifications.
k INTELLECTUAL PROPERTY RIGHTS. Unless otherwise specified in this
Agreement, HWM retains sole title to any intellectual property of HWM
utilized in conjunction with this Agreement. This Agreement does not
constitute a license to use any intellectual property owned or
controlled by HWM, except as set forth in this Agreement.
ALARM MONITORING
SCOPE
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
DESCRIPTION OF SERVICE
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 86
Agreement No. 980427
SECTION E
Page 85 of 85
SECTION E-ENTIRE AGREEMENT
ENTIRE AGREEMENT
The terms contained in this Agreement, and any Orders, including all Exhibits
and subordinate documents attached to or referenced in the Agreement or any
Orders, will constitute the entire agreement between HWM and SBC with regard to
the subject matter hereof and supersede all prior oral and written
communications, agreements and understandings of the parties, if any, with
respect hereto. This Agreement may not be modified expect by a written
instrument signed on behalf of both parties by the representatives who sign
this Agreement or their successors in title and authority. If either
representative is no longer employed by SBC/HWM or has been demoted, or if the
approval level no longer exists, a manager at a level equal to or exceeding the
original level must execute revisions to this Agreement.
SOUTHWESTERN BELL TELEPHONE COMPANY HIGHWAYMASTER CORPORATION ACCEPTED:
ACCEPTED:
By: (x) Steve Welch by W. J. Given By: (x) Jana Bell
------------------------------ --------------------------
Title: President-Corporate and Title: President and CEO
---------------------------- ----------------------------
Administrative Services
---------------------------
Date: 12/18/98 Date: 1/13/99
-------- -------
PACIFIC BELL ACCEPTED: NEVADA BELL ACCEPTED:
By: (x) Steve Welch by W. J. Given By: (x) Steve Welch by W. J. Given
------------------------------ -------------------------------
Title: President-Corporate and Title: President-Corporate and
----------------------- ----------------------------
Administrative Services Administrative Services
------------------------ ----------------------------
Date: 12/18/98 Date: 12/18/98
-------- --------
SOUTHERN NEW ENGLAND TELEPHONE ACCEPTED:
By: (x) Steve Welch by W. J. Given
------------------------------
Title: President-Corporate and
-----------------------
Administrative Services
-----------------------
Date: 12/18/98
--------
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 87
AGREEMENT NO. 980427
APPENDIX I
PAGE 1 OF 25
APPENDIX I - GPS SPECIFICATIONS
[TEXT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 88
AGREEMENT NO. 980427
APPENDIX II
PAGE 1 OF 3
APPENDIX II - PRICING FOR DEPLOYMENT OF INITIAL 11,5000 GPS UNITS
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the
SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 89
AGREEMENT NO. 980427
APPENDIX II
PAGE 2 OF 3
APPENDIX II - PRICING FOR DEPLOYMENT ABOVE INITIAL 11,5000 GPS UNITS
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 90
AGREEMENT NO. 980427
APPENDIX II
PAGE 3 OF 3
HWM NETWORK SERVICE CENTER MONTHLY FEE
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
NOTE: PRICES ABOVE DO NOT INCLUDE APPLICABLE TAXES, AND SURCHARGES WHICH WILL
BE BILLED AS A SEPARATE ITEM ON THE INVOICE.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 91
AGREEMENT NO. 980427
APPENDIX III
PAGE 1 OF 1
APPENDIX III - CHANGE ORDER
- -------------------------------------
CONTRACT/P.O. #
- -------------------------------------
- --------------------------------------------
LOCATION:
- --------------------------------------------
- -------------------------------------------------------------------------------
REQUEST NUMBER ORIGINATOR DATE ORIGINATED DATE ACCEPTED
- -------------- ---------- --------------- -------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DETAILED DESCRIPTION OF CHANGE REQUESTED (ATTACH ADDITIONAL INFORMATION IF
REQUIRED)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
IDENTIFY COST,
IF ANY:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARE CHANGES REQUIRED TO THE GPS SPECIFICATIONS - IF YES,
DESCRIBE AND ATTACH COPY OF CHANGES REQUESTED YES NO
----- ----
- -------------------------------------------------------------------------------
- ---------------
AUTHORIZATIONS:
- ---------------
- -------------------------------------------------------------------------------
SBC: HWM:
- -------------------------------------------------------------------------------
NAME: NAME:
- -------------------------------------------------------------------------------
DATE: DATE:
- -------------------------------------------------------------------------------
UPON ACCEPTANCE RETURN ONE COPY TO:
CHRIS VILCINSKAS, 1010 PINE, 9-E-80, ST. LOUIS, MO. 63101
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 92
AGREEMENT NO. 980427
APPENDIX IV
PAGE 1 OF 2
APPENDIX IV - EXECUTIVE ORDERS AND ASSOCIATED REGULATIONS
Work under this contract may be subject to the provisions of certain Executive
Orders, federal laws, state laws, and associated regulations governing
performance of this contract including, but not limited to: Executive Order
11246, Executive Order 11625, Executive Order 11701, and Executive Order 12138,
Section 503 of the Rehabilitation Act of 1973 as amended and the Vietnam Era
Veteran's Readjustment Assistance Act of 1974. To the extent that such
Executive Orders, federal laws, state laws, and associated regulations apply to
the work under this contract, and only to that extent, Contractor agrees to
comply with the provisions of all such Executive Orders, federal laws, state
laws, and associated regulations, as now in force or as may be amended in the
future, including, but not limited to the following:
1. EQUAL EMPLOYMENT OPPORTUNITY DUTIES AND PROVISIONS OF GOVERNMENT CONTRACTORS
In accordance with 41 C.F.R.Section 60-1.4(a), the parties incorporate
herein by this reference the regulations and contract clauses required by that
section, including but not limited to, Contractor's agreement that it will not
discriminate against any employee or applicant for employment because of race,
color, religion, sex, or national origin. The Contractor will take affirmative
action to ensure that applicants are employed, and that employees are treated
during employment, without regard to their race, color, religion, sex, or
national origin.
2. AGREEMENT OF NON SEGREGATED FACILITIES
In accordance with 41 C.F.R.Section 60-1.8, Contractor agrees that it does
not and will not maintain or provide for its employees any facilities
segregated on the basis of race, color, religion, sex, or national origin at
any of its establishments, and that it does not and will not permit its
employees to perform their services at any location, under its control, where
such segregated facilities are maintained. The term "facilities" as used
herein means waiting rooms, work areas, restaurants and other eating areas,
time clocks, rest rooms, wash rooms, locker rooms and other storage or dressing
areas, parking lots, drinking fountains, recreation or entertainment areas,
transportation, and housing facilities provided for employees; provided, that
separate or single-user restroom and necessary dressing or sleeping areas shall
be provided to assure privacy between the sexes.
3. AGREEMENT OF AFFIRMATIVE ACTION PROGRAM
Contractor agrees that it has developed and is maintaining an Affirmative
Action Plan as required by 41 C.F.R.Section 60-1.4(b).
4. AGREEMENT OF FILING
Contractor agrees that it will file, per current instructions, complete and
accurate reports on Standard Form 100 (EE0-1), or such other forms as may be
required under 41 C.F.R.Section 60-1.7(a).
5. AFFIRMATIVE ACTION FOR HANDICAPPED PERSONS AND DISABLED VETERANS, VETERANS
OF THE VIETNAM ERA.
In accordance with 41 C.F.R.Section 60-250.20, and 41 C.F.R.Section
60-741.20, the parties incorporate herein by this reference the regulations and
contract clauses required by those provisions to be made a part of government
contracts and subcontracts.
6. UTILIZATION OF SMALL, SMALL DISADVANTAGED AND WOMEN-OWNED SMALL BUSINESS
CONCERNS
As prescribed in 48 C.F.R., Ch. 1, 19.708(a):
(a) It is the policy of the United states that small business concerns,
small business concerns owned and controlled by socially and economically
disadvantaged individuals and small business concerns owned and controlled by
women shall have the maximum practicable opportunity to participate in
performing contracts let by any Federal agency, including contracts and
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 93
AGREEMENT NO. 980427
APPENDIX IV
PAGE 2 OF 2
APPENDIX IV - EXECUTIVE ORDERS AND ASSOCIATED REGULATIONS
sub-contracts for systems, assemblies, components, and related services for
major systems. It is further the policy of the United States that its prime
contractors establish procedures to ensure the timely payment amounts due
pursuant to the terms of the subcontracts with small business concerns, small
business concerns owned and controlled by socially and economically
disadvantaged individuals and small business concerns owned and controlled by
women.
(b) The Contractor hereby agrees to carry out this policy in the awarding
of subcontracts to the fullest extent consistent with efficient contract
performance. The Contractor further agrees to cooperate in any studies or
surveys as may be conducted by the United States Small Business Administration
or the awarding agency of the United States as may be necessary to determine
the extent of the Contractor's compliance with this clause.
(c) As used in this contract, the term small business concern shall mean a
small business as defined pursuant to section 3 of the Small Business Act and
relevant regulations promulgated pursuant thereto. The term small business
concern owned and controlled by socially and economically disadvantaged
individuals shall mean a small business concern which is at least 51 percent
unconditionally owned by one or more socially and economically disadvantaged
individuals; or, in the case of any publicly owned business, at least 51
percent of the stock of which is unconditionally owned by one or more socially
and economically disadvantaged individuals; and (2) whose management and daily
business operations are controlled by one or more such individuals. This term
also means small business concern that is at least 51 percent unconditionally
owned by an economically disadvantaged Indian tribe or Native Hawaiian
Organization, or a publicly owned business having at least 51 percent of its
stock unconditionally owned by one of these entities which has its management
and daily business controlled by members of an economically disadvantaged
Indian tribe or Native Hawaiian Organization, and which meets the requirements
of 13 CRF part 124. The Contractor shall presume that socially and
economically disadvantaged individual include Black Americans, Hispanic
Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian
Americans, and other minorities, or any other individual found to be
disadvantaged by the Administration pursuant to section 8(a) of the Small
business Act. The Contractor shall presume that socially and economically
disadvantaged entities also include Indian Tribes and Native Hawaiian
Organizations.
(d) The term "small business concern owned and controlled by women" shall
mean a small business concern (i) which is at least 51 percent owned by one or
more women, or, in the case of any publicly owned business, at least 51 percent
of the stock of which is owned by one or more women, and (ii) whose management
and daily business operations are controlled by one or more women; and
(e) Contractors acting in good faith may rely on written representations by
their sub-contractors regarding their status as a small business concern, a
small business concern owned and controlled by socially and economically
disadvantage individuals or a small business concern owned and controlled by
women.
7. SMALL, SMALL DISADVANTAGED AND WOMEN-OWNED SMALL BUSINESS SUB-CONTRACTING
PLAN.
The sub-contractor will adopt a plan similar to the plan required by 48 CFR
Ch. 1 at 52.219-9.
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The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 94
AGREEMENT NO. 980427
APPENDIX V
PAGE 1 OF 18
QUALITY MANUAL
HIGHWAYMASTER CORPORATION
16479 DALLAS PARKWAY
DALLAS, TEXAS 75248
(972) 732-2500
<TABLE>
<CAPTION>
DOCUMENTATION REVIEW
-----------------------------------------------------------
TITLE NAME
<S> <C>
----------------------------- --------------
COO Gordon Quick
-----------------------------------------------------------
Director Materials Operations Todd Whisenant
-----------------------------------------------------------
</TABLE>
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The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 95
AGREEMENT NO. 980427
APPENDIX V
PAGE 2 OF 18
INDEX
<TABLE>
<S> <C> <C>
1 THE CORPORATE QUALITY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2 QUALITY POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3 PURPOSE AND APPLICABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.1 PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.2 APPLICABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4 QUALTIY SYSTEM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4.1 MANAGEMENT RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4.2 QUALITY SYSTEMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4.3 CONTRACT REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4.4 DESIGN CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.5 DOCUMENT CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.6 PURCHASING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.7 PURCHASER SUPPLIED PRODUCTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.8 PRODUCT IDENTIFICATION / TRACEABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.9 PROCESS CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.10 INSPECTION AND TESTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.11 INSPECTION, MEASURING AND TEST EQUIPMENT . . . . . . . . . . . . . . . . . . . . . . . . 13
4.12 INSPECTION AND TEST STATUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.13 CONTROL OF NON-CONFORMING PRODUCT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.14 CORRECTIVE AND PREVENTIVE ACTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.15 HANDLING, STORAGE, PACKAGING, PRESERVATION AND DELIVERY . . . . . . . . . . . . . . . . . 16
4.16 QUALITY RECORDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.17 INTERNAL QUALITY AUDITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
</TABLE>
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for distribution outside their respective
companies except by written agreement.
<PAGE> 96
AGREEMENT NO. 980427
APPENDIX V
PAGE 3 OF 18
<TABLE>
<S> <C> <C>
4.18 TRAINING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.19 SERVICING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.20 STATISTICAL TECHNIQUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
</TABLE>
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and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 97
AGREEMENT NO. 980427
APPENDIX V
PAGE 4 OF 18
1 THE CORPORATE QUALITY STATEMENT
HIGHWAYMASTER IS A CUSTOMER-ORIENTED SUPPLIER
OF QUALITY PRODUCTS AND SERVICES. OUR TEAM IS
COMMITTED TO BEING THE PREFERRED SUPPLIER TO THE
INDUSTRIES WE SERVE BY PROVIDING SATISFACTION FOR
OUR CUSTOMERS. WE ARE DEDICATED TO CONTINUOUS IMPROVEMENT
AND STRIVE TO BE THE BEST IN EVERYTHING WE DO.
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<PAGE> 98
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APPENDIX V
PAGE 5 OF 18
2 QUALITY POLICY
HighwayMaster is committed to achieving Total Customer Satisfaction and
promoting continuous improvement throughout the organization. Every
employee is responsible for identifying and meeting customer
expectations. We are committed to provide our employees the necessary
tools, information and authority which allows them to make quality
decisions for HighwayMaster and its customers.
3 PURPOSE AND APPLICABILITY
3.1 PURPOSE
The purpose of this quality policy is to present HighwayMaster's concept
of the requirements for producing products and services that are
intended to meet the customer's needs and expectations. HighwayMaster is
committed to the increasing trend towards more stringent customer
expectations with regard to quality. HighwayMaster also realizes that
accompanying this trend there has been a growing realization that
continual improvements in quality are often necessary to achieve and
sustain good economic performance.
3.2 APPLICABILITY
This policy is applicable to all products and services sold by
HighwayMaster, inclusive of all programs that come under special quality
specifications and individual customer specifications.
4 QUALITY SYSTEM
HighwayMaster's quality system seeks to accomplish three objectives
regarding quality:
a. HighwayMaster shall achieve and sustain the quality of the product
or service produced so as to continually meet the customer's
stated or implied needs.
b. HighwayMaster shall provide confidence to its own management that
the intended quality is being achieved and sustained.
c. HighwayMaster shall provide confidence to the customer that the
intended quality is being, or will be, achieved in the delivered
product or service provided.
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and is not for general distribution within or
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<PAGE> 99
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APPENDIX V
PAGE 6 OF 18
4.1 MANAGEMENT RESPONSIBILITY
Management will define and document its policy and objectives for, and
commitment to, Quality. Management has the responsibility for providing
the necessary planning, resource allocation, training, operations, and
evaluation of quality. Management will ensure that this policy is
understood, implemented and maintained at all levels in the
organization.
4.2 QUALITY SYSTEMS
HighwayMaster shall institute and sustain a documented quality system.
This system will ensure that HighwayMaster builds a quality product that
meets all specified requirements. This system shall include:
4.2.1 The preparation of documented quality system procedures and instructions
in accordance with our customers requirements.
4.2.2 The effective implementation of those procedures and instructions
designed to ensure a quality product.
4.2.3 The timely preparation of quality plans and other quality documentation
as required by the customer. In the interest of standardization and
minimizing duplication of effort, this Quality Manual will be used as the
standard Quality Plan. Exceptions to the policy manual will be listed
separately as the customer Quality Plan.
4.2.4 The identification and acquisition of any controls, processes, inspection
equipment, tools, fixtures, and other equipment that may be required to
achieve the desired quality results.
4.2.5 The identification of specific skills needed to achieve the required
quality and the necessary training to ensure that qualified personnel
are performing to specified capabilities.
4.2.6 The updating, as required, of quality assurance, inspection and testing
techniques, equipment and other measuring devices to meet changes in
requirements and capabilities.
4.2.7 The identification, preparation and maintenance of quality records, and
reports as required by the customer.
4.2.8 An auditing system that ensures the compliance to all aspects of the
quality system as defined in this procedure.
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and is not for general distribution within or
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<PAGE> 100
AGREEMENT NO. 980427
APPENDIX V
PAGE 7 OF 18
4.3 CONTRACT REVIEW
HighwayMaster shall maintain a procedure for contract review. Product
Management shall ensure that Quality Engineering reviews customer
contracts for the following if required:
4.3.1 Quality requirements are adequately defined and documented.
4.3.2 Any quality requirements that are different from normal quality
specifications or requirements are resolved before the final signing of
the contract.
4.3.3 HighwayMaster has the capability to meet the contractual quality
requirements or is in the process of attaining those capabilities.
Product Management shall maintain records of the contract review.
4.4 DESIGN CONTROL
HighwayMaster design capability includes analog, digital, microprocessor
circuitry, as well as the complete capability for printed circuit board
and mechanical packaging design. HighwayMaster capability also includes
software development design capabilities.
Design Control procedures are written to ensure that design activities
meet requirements, are planned so that qualified personnel are assigned
to the project, and that all requirements are identified, documented,
and reviewed. The controlling procedures for ECR is #P0001 and the
controlling procedures for ECN is # P0002. Software and Hardware Design
Engineering departments control the various activity procedures
internally.
4.5 DOCUMENT CONTROL
All documents for HighwayMaster are reviewed and approved prior to
issue. Appropriate documents are available at locations where they are
intended to be used. Obsolete documents are removed from points of use
and retained in accordance with document control procedures.
4.5.1 Controlled Documentation
4.5.1.1 Quality system documents comprises the following type documents:
4.5.1.1.1 Quality Manual
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and is not for general distribution within or
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<PAGE> 101
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APPENDIX V
PAGE 8 OF 18
4.5 DOCUMENT CONTROL (CONTINUED)
4.5.1.2.1 Requirements
4.5.1.2.2 Drawings
4.5.1.2.3 Engineering Change Notices
4.5.1.2.4 Manufacturing Deviations
4.5.1.2.5 Related Form
4.5.2 Document Approval
Management initializes document changes. All documents are reviewed and
approved prior to issue. A master file of all documents is maintained
and is comprised of the document, revision, status, release date, change
date and the location(s) of the documents. Documents are distributed to
personnel and locations where they are used. When appropriate and
relevant, documents display an approval list.
4.5.3 Document Changes
4.5.3.1 Document changes are reviewed and authorized by the Implementation
Readiness Review (IRR) committee and Configuration Control Board (CCB)
teams. Revised portions of documents are distributed with a change
brief, and obsolete documents are removed. A master list specifying
the latest issues and revisions is maintained.
4.5.3.2 A notice of change documents is released to the appropriate personnel.
4.6 PURCHASING
HighwayMaster assesses its suppliers and subcontractors and purchases
only from those that can satisfy the company's quality requirements.
Purchasing documents clearly and completely describe ordered products,
including quality requirements. Purchasing documents are approved prior
to release.
4.6.1 Procurement
HighwayMaster will procure materials for each program utilizing prints
and specifications generated internally. In the absence of these, the
supplier's specifications shall be used. Purchasing requirements shall
contain the necessary data to adequately describe the product being
ordered, to include, where applicable:
4.6.1.1 A complete description of the product required
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<PAGE> 102
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APPENDIX V
PAGE 9 OF 18
4.6 PURCHASING (CONTINUED)
4.6.1.2 A listing of applicable specifications, drawing, process requirements,
testing, inspection and/or any other technical data that is required.
Notation of special approvals or qualifications of product,
procedures, process or personnel.
4.6.1.3 Purchasing will verify that the material being ordered meets the
current revision. Assumptions on revision levels will not be made
based on previous orders.
4.6.1.4 When applicable, Quality shall review and approve purchasing documents
for adequacy of specified requirements prior to release.
4.6.2 Approved/Qualified Vendor's List (AVL)
Purchasing will procure components and raw materials from only those
specified suppliers on the AVL. If additional suppliers are needed,
Purchasing will seek approval for additional suppliers through
Engineering, Materials Operations, Quality Assurance, and the customer.
Purchasing will select additional suppliers on the basis of their
ability to meet contractual requirements, including quality
requirements. HighwayMaster shall, through Quality Engineering, survey
additional suppliers as required using the Supplier Qualification
Procedure. (See Supplier Performance Evaluation MOP # 401)
4.6.3 Supplier Selection and Control
Supplier selection and control shall be the responsibility of Materials
Operations. The HighwayMaster Quality Department, using the
HighwayMaster Supplier Survey form (See Supplier Performance Evaluation
MOP # 401) will survey new suppliers. After the survey, the supplier
will be notified of the survey results, along with any required
corrective action, within two weeks of survey completion.
The Quality Department will maintain ongoing records of lot acceptance
rates (LAR) and delivery performance for each approved supplier.
Suppliers will be surveyed annually. Product source inspections will be
done quarterly. (See Supplier Performance Evaluation MOP # 401)
Failure to adequately respond to a Supplier Corrective Action Request
may be grounds for supplier disqualification.
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and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 103
AGREEMENT NO. 980427
APPENDIX V
PAGE 10 OF 18
4.6 PURCHASING (CONTINUED)
4.6.4 Supplier Report Card
A supplier report card shall be sent to each supplier at the end of each
month. The report card will list monthly and Year To Date (YTD) Lot
Acceptance Rate (LAR) and delivery performance, On Time Delivery (OTD).
The Quality Department has responsibility for maintaining these records
and sending the report cards.
4.6.5 Incoming Quality Assurance (IQA)
All production component and materials will be inspected by IQA to a
predetermined sampling plan using the relevant specifications. Where
deemed acceptable, "Ship to Stock" procedures will be established with
qualified suppliers. When incoming material is released for urgent
production purposes, it shall be identified and recorded in order to
permit recall and replacement in the event of non-conformances to
specified requirements.
4.6.5.1 Component Inspection & Test Planning
A dedicated inspection station shall be maintained at the
HighwayMaster Warehouse consisting of an inspection area,
appropriate tools, and file cabinets for drawings, procedures,
sampling plans, and test results. This station will be under the
control of the Quality Department.
4.6.5.2 First Article Inspection
First Article Inspection will be performed per First Article
procedure on all unique components (sheet metal, castings, PC
Boards, cabled, etc.). A copy of the First Article findings will
be placed in the Supplier history files. New revisions will be
incorporated into the First Articles as they are released through
the ECO procedure.
4.6.5.3 Lot Sampling And Record Keeping
Quality inspection instruction documents will be created for each
part, as new parts are received. These documents will detail
administrative, mechanical, and electrical tests to be performed
on each lot. An Acceptable Quality Level (AQL) sampling plan based
on ANSI ASQC Z1.4 will be created for each part. Normal inspection
levels (single sampling plan) will be used for all parts
initially. The HighwayMaster quality engineer has the authority to
change a plan to reduced or tightened inspection, based on quality
history.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 104
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APPENDIX V
PAGE 11 OF 18
4.6 PURCHASING (CONTINUED)
Inspection results will be recorded on the HighwayMaster
Inspection Summary form.
Non-conforming material shall be tagged "reject" and segregated
from acceptable and untested material where it will await
dispositioning by the Material Review Board. A one hundred percent
inspection of a rejected lot many be performed at the direction of
the Quality Engineer in the event that material is urgently
needed.
Each rejected lot shall be cause for us issuance of a Supplier
Corrective Action Request (SCAR).
4.6.5.4 Non-Conforming Material Control
A Material Review Board (MRB) shall review and disposition all
non-conforming and rejected procured material. The disposition
process is documented. The MRB shall consist of representatives
form Quality, Engineering, Purchasing, and Product Integrity. The
quality representative will chair the board.
The function of this board shall be the dispositioning of
non-conforming material. The five acceptable dispositions are:
4.6.5.4.1 Return To Vendor (RTV)
4.6.5.4.2 Use As Is (USI)
4.6.5.4.3 Scrap (SCP)
4.6.5.4.4 Rework (RWK)
4.6.5.4.5 Re-Inspect (REI)
4.6.5.5 Correction Action Request
Supplier correction action is a corrective action initiated by
HighwayMaster to resolve customer complaints regarding defective
product.
If the product is found to be defective, the Quality Department
will initiate appropriate corrective action, at the manufacturer
of the product. The corrective action will be documented and
maintained in the Corrective Action Log.
4.7 PURCHASER SUPPLIED PRODUCTS
Not Applicable for HighwayMaster at this time.
4.8 PRODUCT IDENTIFICATION / TRACEABILITY
HighwayMaster establishes and maintains procedures for marking the product
from applicable drawings, specifications, or other documents, during
production and delivery. Markings used for product identification include,
but not limited to:
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and is not for general distribution within or
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<PAGE> 105
AGREEMENT NO. 980427
APPENDIX V
PAGE 12 OF 18
a) labels
b) storage bins
c) product location
Such information is also used to maintain identification throughout the
production process. When tractability is a contractual requirement,
individual products or batches have a unique identification.
4.9 PROCESS CONTROL
HighwayMaster shall plan the production of assemblies and units so that a
quality product is produced and the processes are carried out under
controlled conditions.
4.9.1 Refer to subcontract manufacturer quality system.
4.9.2 Process Documentation
4.9.2.1 Manufacturing
Documentation for manufacturing shall be provided my
HighwayMaster's contract manufactures. Documents should include
the following types"
a) Work Instructions for each assembly with set-up and
detailed methods interactions
b) Material handling specification when required
c) Process specifications
d) Process flow charts
e) Quality flow-charts
f) Product traceability
g) Procedure for rework and repair to assemblies and units
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and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 106
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APPENDIX V
PAGE 13 OF 18
4.10 INSPECTION AND TESTING
Inspection and testing are conducted when purchased materials are
received, at significant stages of production, prior to shipping stages
of production, and prior to shipping finished product. The objective of
inspections and testing is to verify conformance with specified
requirements. Materials and products are prevented from being used or
shipped until the required inspections are completed. Records of
inspections are established and maintained as evidence that products
comply with stated requirements.
4.10.1 HighwayMaster's contract manufacturers shall provide procedures for
the following areas.
4.10.1.1 General
The general requirement for inspection and testing is documented
in the contract manufacturer's Quality Plan.
4.10.1.2 Receiving inspection and testing
The contract manufacturer's receiving inspection and testing plan
will be used to meet HighwayMaster requirements.
4.10.1.3 Final inspection and testing
The contract manufacturer's final inspection and testing plan will
be used to meet HighwayMaster requirements.
4.10.1.4 Inspection and test records
The contract manufacturer's inspection and test records plan will
be used to meet HighwayMaster requirements.
4.11 INSPECTION, MEASURING AND TEST EQUIPMENT
HighwayMaster policy requires that all tools, instruments, and test
equipment are in good repair and calibration. Refer to subcontract
manufacturer quality plan.
The contract manufacturer's procedures will be used to meet HighwayMaster
requirements for all products produced.
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employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 107
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APPENDIX V
PAGE 14 OF 18
4.12 INSPECTION AND TEST STATUS
The inspection and test status will be identified and maintained
throughout design, production, installation, and servicing of product.
This is defined in documented Quality Procedures and instructions to
ensure that only product which has passed required inspections and tests
is ultimately shipped to customers.
4.12.1 Nonconforming material is clearly identified and segregated
4.13 CONTROL OF NON-CONFORMING PRODUCT
Nonconforming product is identified, documented, evaluated, and
prevented from being used or shipped. Responsibility for disposition of
nonconforming product is defined and, when required, the customer is
contacted for advisement. Repaired or reworked product is reinspected.
4.13.1 Identification and Documentation
All nonconforming product that can not be corrected using IPC Standard
of repair or rework current revision is identified and documented.
4.13.2 Nonconforming Review and Disposition
A Material Review Board (MRB) shall review and disposition all
non-conforming and rejected product. The disposition process is
documented. The MRB shall consist of representatives form Quality,
Engineering, Purchasing, and Product Integrity. The quality
representative will chair the board. The function of this board shall
be the dispositioning of non-conforming product. The five acceptable
dispositions are:
4.13.2.1 Return To Vendor (RTV)
4.13.2.2 Use As Is (USI)
4.13.2.3 Scrap (SCP)
4.13.2.4 Rework (RWK)
Rework is subject to inspection after rework is performed
4.13.2.5 Re-Inspect (REI)
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and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 108
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PAGE 15 OF 18
4.14 CORRECTIVE AND PREVENTIVE ACTION
Corrective action is taken to help assure identified problems are
quickly resolved to minimize potential quality issues and implement
permanent solutions. Corrective actions are issued, recorded, and
verified in accordance with documented procedures. Preventative action
is taken to assist management in continuous improvement efforts.
Preventative actions are also issued, recorded, and verified in
accordance with documented procedures.
4.14.1 Everyone in the organization is responsible for instituting,
monitoring, or requesting corrective/preventative actions. Problems
are evaluated for potential impact on production processes, safely,
quality, performance, reliability, or customer satisfaction. Sources
of data and information used in evaluation may come from failure
analysis results, manufacturing operations, or customers.
4.14.2 Problems are analyzed to determine whether immediate corrective action
is required. Action may include production stoppage, shipping hold,
stock purge, supplier hold, or product recall. Once immediate control
action has been taken, the cause is analyzed to determine required
corrective action. Short-term corrective actions may include customer
notification, rework, or product screening. Long-term corrective
actions include product redesign or production process revision.
4.14.3 After the cause of the problem has been identified, measures are also
taken to prevent its recurrence. Nonconforming items are properly
disposed of or corrected. The effects of these measures are audited to
assure the desired goals are met and the permanent changes are in
place, documented, and communicated.
4.14.4 Corrective Action Request
Contract Manufacturer of nonconforming product are sent a corrective
action request to verify continuous compliance of product requirements
4.14.5 Preventive actions plans will be created as needed to address longer
term trends as represented by quality related data.
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The information contained herein is for use by authorized
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and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 109
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PAGE 16 OF 18
4.15 HANDLING, STORAGE, PACKAGING, PRESERVATION AND DELIVERY
All material and product is handled, stored, packaged, preserved and
delivered in a manner which prevents damage, deterioration, and
contamination.
4.15.1 Handling
Product handling is performed in a manner that prevents damage or
deterioration. Personnel are instructed in proper methods of ESD
control and general methods of handling.
4.15.2 Storage
Defined storage areas are provided to prevent damage or deterioration
of the product prior to use. The receipt and authorized issue of
product from the storage area is undertaken in line with written
procedures. Storage of product is controlled as to maintain product
quality.
4.15.3 Packaging
Product approved for delivery after final inspection and test has been
conducted, is packaged in such a manner as to provide adequate
protection from damage during storage and subsequent delivery. The use
and configuration of packaging materials is defined in written
specifications or in accordance with customer requirements. Packaged
product is suitably identified and the marking controlled.
4.15.4 Delivery
Product is afforded adequate protection after final inspection and
test. Where contractually specified, this protection is extended to
include delivery to destination.
4.16 QUALITY RECORDS
4.16.1 Control requirements
4.16.1.1 The Quality Engineering ensures that the records required in the
operation of the Quality Management System are properly
maintained.
4.16.1.2 Quality records are maintained to demonstrate achievement of the
required quality and the effectiveness of the Quality Management
System.
4.16.1.3 All quality records are legible and identifiable to the product or
process
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 110
AGREEMENT NO. 980427
APPENDIX V
PAGE 17 OF 18
4.16 QUALITY RECORDS (CONTINUED)
concerned. They may be in the form of any type of media including
electronic form. Quality records are stored and maintained in such
manner as to provide for ready access. Storage facilities are
selected to minimize deterioration or damage and prevent loss.
4.16.1.4 Regulatory Agency records, and Vendor supplied records related to
the quality of purchased goods shall be part of this system.
4.17 INTERNAL QUALITY AUDITS
4.17.1 The compliance and effectiveness of the Quality System is verified by
conducting internal quality audits on a regular basis. The results of
these audits are used by management to identify the state of the
Quality System.
4.17.2 Internal quality audits are performed by trained auditors who are
independent of the product, process or system that is audited. Audits
are planned and performed in accordance with documented procedures.
4.17.3 Records of all audits are maintained and reviewed with the responsible
management personnel.
4.17.4 Nonconformance identified during the audit process will be issued
corrective actions. These will be discussed and issued during the
management review. Corrective action follow-up will be performed in
accordance with documented procedures.
4.18 TRAINING
4.18.1 All personnel will have the necessary level of experience or training
to enable them to undertake designated tasks competently. In-house
training and certification, where specified, is provided. Where
necessary, external training resources and facilities will be
utilized.
4.18.2 Training records are maintained in accordance with documented
procedures. Records are maintained for all training carried out on
all employees, including internal, external, and on-the- job, courses
attended, and the qualification, and certificates received.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 111
AGREEMENT NO. 980427
APPENDIX V
PAGE 18 OF 18
4.19 SERVICING
Where servicing is a contractually specified requirement, the company
draws up a quality plan in consultation with the client to control this
activity. Documented procedures for performing, verifying and reporting
that serving meets specified requirements are established as servicing
activities are agree to.
4.20 STATISTICAL TECHNIQUES
4.20.1 Identification of Need
4.20.1.1 HighwayMaster's subcontractors will establish policy and
direction for Statistical Process Control implementation and
maintenance. Management may consist of: Directors of Manufacturing
or Engineering, Quality Assurance Director or their designee.
4.20.1.2 Statistical Control Techniques will be used throughout the
manufacturing process as a method of determining material, product
and process quality. An examination of the opportunity for
Statistical Control Techniques will be performed as new processes
are developed. Refer to subcontract manufacturer quality plan.
4.20.2 Procedures
4.20.2.1 Guidelines for the implementation of Statistical Control
Techniques are defined and documented at HighwayMaster's
subcontractors. Identification of statistical techniques that may
be used, the basis for selecting each method used as well as a
component for identifying when to use the method to verify
customers needs will be defined.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 112
Agreement No. 980427
Exhibit A
Page 1 of 3
================================================================================
PRIME SUPPLIER
MBE/WBE/DVBE PARTICIPATION PLAN
================================================================================
PRIME SUPPLIER NAME:
------------------------------------------------------------
ADDRESS:
------------------------------------------------------------------------
TELEPHONE NUMBER:
---------------------------------------------------------------
DESCRIBE GOODS OR SERVICES BEING PROVIDED UNDER THIS AGREEMENT:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DESCRIBE YOUR M/WBE-DVBE OR SUPPLIER DIVERSITY PROGRAM AND THE PERSONNEL
DEDICATED TO THAT PROGRAM:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
THE FOLLOWING, TOGETHER WITH ANY ATTACHMENTS IS SUBMITTED AS AN MBE/WBE/DVBE
PARTICIPATION PLAN.
1. GOALS
A. WHAT ARE YOUR MBE/WBE/DVBE PARTICIPATION GOALS?
o MINORITY BUSINESS ENTERPRISES (MBES) %
------
o WOMEN BUSINESS ENTERPRISES (WBES) %
------
o DISABLED VETERANS BUSINESS
ENTERPRISES (DVBES) %
------
B. WHAT IS THE ESTIMATED ANNUAL VALUE OF THIS CONTRACT WITH
PACIFIC BELL? ______________
SOUTHWESTERN BELL TELEPHONE COMPANY ("SBC")? ______________
OTHER SBC AFFILIATE? ______________
NOTE: INDICATE DOLLAR AWARD(S) AS IT APPLIES TO THIS CONTRACT
(I.E., PACIFIC BELL, SBC AND/OR AFFILIATE).
C. WHAT ARE THE DOLLAR AMOUNTS OF YOUR PROJECTED MBE/WBE/DVBE
PURCHASES?
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 113
Agreement No. 980427
Exhibit A
Page 2 of 3
o MINORITY BUSINESS ENTERPRISES (MBES)
--------
o WOMEN BUSINESS ENTERPRISES (WBES)
--------
o DISABLED VETERANS BUSINESS
ENTERPRISES (DVBES)
--------
*SEE MBE/WBE/DVBE CANCELLATION CLAUSE IN AGREEMENT FOR DEFINITIONS OF MBE, WBE,
AND DVBE*
2. LIST THE PRINCIPAL GOODS AND/OR SERVICES TO BE SUBCONTRACTED TO
MBE/WBE/DVBES OR DELIVERED THROUGH MBE/WBE/DVBE VALUE ADDED RESELLERS.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DETAILED PLAN FOR USE OF M/WBES-DVBES AS SUBCONTRACTORS,
DISTRIBUTORS, VALUE ADDED RESELLERS
FOR EVERY PRODUCT AND SERVICE YOU INTEND TO USE, PROVIDE THE FOLLOWING
INFORMATION: (ATTACH ADDITIONAL SHEETS IF NECESSARY)
<TABLE>
<CAPTION>
COMPANY NAME CLASSIFICATION PRODUCTS/SERVICES $ VALUE DATE TO BEGIN
(MBE/WBE/DVBE) TO BE PROVIDED
------------ -------------- ----------------- ------- -------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 114
Agreement No. 980427
Exhibit A
Page 3 of 3
3. SELLER AGREES THAT IT WILL MAINTAIN ALL NECESSARY DOCUMENTS AND
RECORDS TO SUPPORT ITS EFFORTS TO ACHIEVE ITS MBE/WBE/DVBE
PARTICIPATION GOAL(S). SELLER ALSO ACKNOWLEDGES THE FACT THAT
IT IS RESPONSIBLE FOR IDENTIFYING, SOLICITING AND QUALIFYING
MBE/WBE/DVBE SUBCONTRACTORS, DISTRIBUTORS AND VALUE ADDED
RESELLERS.
4. THE FOLLOWING INDIVIDUAL, ACTING IN THE CAPACITY OF MBE/WBE/DVBE
COORDINATOR FOR SELLER, WILL:
o ADMINISTER THE MBE/WBE/DVBE PARTICIPATION PLAN,
o SUBMIT SUMMARY REPORTS, AND
o COOPERATE IN ANY STUDIES OR SURVEYS AS MAY BE REQUIRED IN ORDER
TO DETERMINE THE EXTENT OF COMPLIANCE BY THE SELLER WITH THE
PARTICIPATION PLAN.
NAME: (PRINTED)
-------------------------------------------------------
TITLE:
-----------------------------------------------------------------
TELEPHONE NUMBER:
------------------------------------------------------
AUTHORIZED SIGNATURE:
--------------------------------------------------
DATE:
------------------------------------------------------------------
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 115
Agreement No. 980427
Exhibit B
Page 1 of 2
EXHIBIT B - PARTICIPATION PLANS AND RESULTS REPORTS
PRIME CONTRACTOR NAME:
ADDRESS:
TELEPHONE NUMBER:
RFQ/RFB/RFP/RFI NUMBER (IF APPLICABLE): NA
--
DESCRIPTION OF GOODS OR SERVICES:
DEFINITION: A COMMODITY (OR COMMERCIAL) PRODUCT IS DEFINED BY THE REGULATIONS AS
ONE IN REGULAR PRODUCTION THAT IS SOLD IN SUBSTANTIAL QUANTITIES TO
THE GENERAL PUBLIC AND/OR INDUSTRY AT REGULAR PRICES.
IF A COMPANY IS OFFERING A COMMODITY PRODUCT, THEN THE SUBCONTRACTING PLAN MAY
RELATE TO THE COMPANY'S GENERAL PRODUCTION OF BOTH COMMERCIAL AND NON-COMMERCIAL
PRODUCTS, RATHER THAN JUST SPECIFIC ITEMS BEING PROCURED UNDER THE CONTRACT.
THE FOLLOWING, TOGETHER WITH ANY ATTACHMENTS IS SUBMITTED AS AN MBE/WBE/DVBE
SUBCONTRACTING PLAN.
1. DO YOU PLAN TO SUBCONTRACT ANY PORTION OF THE GOODS OR SERVICES BEING
QUOTED, BID OR PROPOSED?
YES NO
2. IF ANSWER TO ITEM 1 IS YES,
A. WHAT IS YOUR OVERALL COMPANY MBE/WBE/DVBE PROGRAM GOAL:
o MINORITY BUSINESS ENTERPRISES (MBES) 0%
o WOMEN BUSINESS ENTERPRISES (WBES) 0%
o DISABLED VETERANS BUSINESS ENTERPRISES (DVBES) 0%
B. WHAT IS YOUR PROJECTED MBE/WBE/DVBE PURCHASES:
o MINORITY BUSINESS ENTERPRISES (MBES) 0%
o WOMEN BUSINESS ENTERPRISES (WBES) 0%
o DISABLED VETERANS BUSINESS ENTERPRISES (DVBES) 0%
* SEE MBE/WBE/DVBE CANCELLATION CLAUSE IN AGREEMENT FOR DEFINITIONS OF MBE,
WBE, AND DVBE*
3. IF ANSWER TO ITEM 1 IS NO, OR IF NO MBE/WBE/DVBE SUBCONTRACTORS WILL BE
UTILIZED WHERE SUBCONTRACTING HAS BEEN IDENTIFIED, PLEASE EXPLAIN IN
DETAIL: (ATTACH ADDITIONAL SHEETS IF NECESSARY)
NA
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 116
Agreement No. 980427
Exhibit B
Page 2 of 2
4. LIST THE PRINCIPAL GOODS AND/OR SERVICES TO BE SUBCONTRACTED TO
MBE/WBE/DVBES, SHOULD YOUR QUOTATION, BID OR PROPOSAL BE ACCEPTED: (ATTACH
ADDITIONAL SHEETS IF NECESSARY)
5. DESCRIBE WHAT GOOD FAITH EFFORTS YOU PLAN TO UNDERTAKE TO ENSURE THAT
MBE/WBE/DVBES WILL HAVE AN EQUITABLE OPPORTUNITY TO COMPETE FOR
SUBCONTRACTS TO BE AWARDED: (ATTACH ADDITIONAL SHEETS IF NECESSARY)
6. THE CONTRACTOR AGREES THAT IT WILL MAINTAIN, IF AWARDED THE RESULTING
CONTRACT/PURCHASE OR WORK ORDER, ALL NECESSARY DOCUMENTS AND RECORDS TO
SUPPORT ITS EFFORTS TO ACHIEVE ITS ESTIMATED MBE/WBE/DVBE SUBCONTRACTING
GOAL(S). CONTRACTOR ALSO ACKNOWLEDGES THE FACT THAT IT WILL BE RESPONSIBLE
FOR IDENTIFYING, SOLICITING AND QUALIFYING MBE/WBE/DVBE SUBCONTRACTORS.
7. THE FOLLOWING INDIVIDUAL, ACTING IN THE CAPACITY OF MBE/WBE/DVBE
COORDINATOR FOR CONTRACTOR, WILL:
o ADMINISTER THE MBE/WBE/DVBE SUBCONTRACTING PLAN,
o SUBMIT SUMMARY REPORTS, AND
o COOPERATE IN ANY STUDIES OR SURVEYS AS MAY BE REQUIRED BY SWBT IN ORDER
TO DETERMINE THE EXTENT OF COMPLIANCE BY ATC WITH THE SUBCONTRACTING
PLAN.
NAME:
TITLE:
TELEPHONE NUMBER:
AUTHORIZED SIGNATURE:
TYPED/PRINTED NAME:
TITLE:
DATE:
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties and their affiliates hereto only
and is not for general distribution within or
for distribution outside their respective
companies except by written agreement.
<PAGE> 1
EXHIBIT 10.36
ADMINISTRATIVE CARRIER AGREEMENT
THIS ADMINISTRATIVE CARRIER AGREEMENT (the "Agreement") is entered into
by and between HighwayMaster Corporation ("HighwayMaster"), a Delaware
corporation, with its principal place of business located at 1155 Kas Drive,
Richardson, Texas, 75081, and Southwestern Bell Mobile Systems, Inc., a Virginia
and Delaware corporation ("SBMS"), with its principal place of business located
at 17330 Preston Road, Suite 100A, Dallas, Texas 75252, effective as of March
30, 1999.
WHEREAS, HighwayMaster has previously engaged, and through the Cutover
Date will engage, GTE Wireless, Inc. ("GTEW") to provide administrative and
billing services to HighwayMaster in connection with HighwayMaster's provision
of enhanced services to its end users; and
WHEREAS, HighwayMaster and GTEW have agreed that HighwayMaster will
engage a new provider of administrative and billing services; and
WHEREAS, HighwayMaster desires to engage SBMS and SBMS desires to
provide to HighwayMaster certain administrative and billing services in
connection with HighwayMaster's provision of enhanced services to
HighwayMaster's end users;
NOW, THEREFORE, in consideration of the premises, the terms and
conditions set forth herein, the mutual benefits to be gained by the performance
thereof and other good, valuable, mutual and binding consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as follows:
I. DEFINITION OF TERMS
1. The definition of terms set forth in this Section 1 shall apply in this
Agreement (in addition to terms expressly defined elsewhere herein)
including any and all exhibits, addenda, and amendments made to or
incorporated herein now or in the future:
1.1. "Affiliate" means any person or entity that directly or
indirectly, through one or more intermediaries, controls, is
controlled by or is under common control with another person
or entity. Control shall be defined as (i) fifty percent (50%)
or more ownership or beneficial interest of income and capital
of an entity; or (ii) ownership of at least fifty percent
(50%) of the voting power of voting equity; or (iii) sole or
shared management by a general partner of the entity; or (iv)
the ability to otherwise direct management policies of the
entity by contract or otherwise.
1.2. "BID" means the billing identification code that allows an
NPA/NXX in a Market to be defined as a stand alone billing
center.
1.3. "Carrier" means a company authorized by appropriate regulatory
agencies to provide
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 1
<PAGE> 2
domestic cellular radio service.
1.4. "Cellular Number or MIN" means the phone number or mobile
identification number assigned to a Unit.
1.5. "Covered Markets" means those Markets operated by Carriers
with which SBMS has both an Intercarrier Roamer Service
Agreement ("IRSA") and Addendum to IRSA for HighwayMaster
Service, and with which HighwayMaster has a Cellular Service
Agreement ("CSA").
1.6. "CTS" means cellular telephone service available in any
Covered Market.
1.7. "CTS Usage" means the use of cellular airtime services for any
purpose.
1.8. "Cutover Date" means the date on which GTEW ceases to provide
Services for HighwayMaster and SBMS begins to provide the
Services to HighwayMaster.
1.9. "Data CTS" means the use of cellular airtime services for the
purpose of transmitting data communications via cellular
networks.
1.10. "End-Users" means the customers of HighwayMaster who purchase
the enhanced services for use in connection with the Units.
1.11. "FCC" means the Federal Communications Commission.
1.12. "HighwayMaster Information" means the technical and business
information which is proprietary and confidential to
HighwayMaster, and such other information marked
"Confidential" and disclosed to SBMS by HighwayMaster pursuant
to this Agreement. The HighwayMaster Information shall not
include information which: (a) is now or in the future becomes
generally known to the public through no fault of SBMS; (b)
prior to disclosure hereunder, is properly within the
legitimate possession of SBMS, without any restriction on
disclosure; (c) subsequent to disclosure hereunder, the
information is lawfully received from a third party having
rights to disseminate the information and without any
restriction on disclosure; (d) is obligated to be produced
under order of a court of competent jurisdiction or by means
of other valid legal process; provided, however, that SBMS
shall notify HighwayMaster of such order or process so that
HighwayMaster may seek a protective order; and/or (e) was
independently developed by SBMS without reference to or
reliance on the HighwayMaster Information.
1.13. "IRSA" means an Intercarrier Roamer Service Agreement.
1.14. "IRSA Addendum" means an Addendum to an Intercarrier Roamer
Service Agreement between SBMS and a Carrier to facilitate the
provision of domestic
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 2
<PAGE> 3
celluar roaming service to HighwayMaster's end users in that
Carrier's market(s).
1.15. "Market" means a cellular service area operated by a Carrier,
which consists of one or more licensed areas defined by the
Federal Communications Commission as either metropolitan
statistical areas ("MSAs") or rural service areas ("RSAs").
1.16. "Material Default" means any material breach of any
obligation, representation, warranty or covenant by a party to
this Agreement which has not been cured within thirty (30)
days after notice of such breach is given to the breaching
party by the non-breaching party.
1.17. "Non-SBMS Carrier" means a Carrier with which SBMS has signed
an IRSA that is not an SBMS Affiliate.
1.18. "Non-SBMS Market" means any domestic cellular market, whether
an MSA or RSA or a combination thereof, for which a Non-SBMS
Carrier holds the FCC license or in which a Non-SBMS Affiliate
manages or holds a controlling interest.
1.19. "NPA/NXX" means a ten thousand block of telephone numbers
represented by the NPA (numbering plan area or area code) and
NXX (prefix) assigned to that block of numbers.
1.20. "NSC" means the Network Services Center owned and operated by
HighwayMaster.
1.21. "Roaming Rate" means the agreed upon rate established by
HighwayMaster and each Carrier in a Market operated by such
Carrier for CTS Usage in that Carrier's Market.
1.22. "SBMS Carrier" means a Carrier that is SBMS or an SBMS
Affiliate.
1.23. "SBMS Information" means the technical and business
information which is proprietary and confidential to SBMS, and
such other information marked "Confidential" and disclosed to
HighwayMaster by SBMS pursuant to this Agreement. The SBMS
Information shall not include information which: (a) is now or
in the future becomes generally known to the public through no
fault of HighwayMaster; (b) prior to disclosure hereunder, is
properly within the legitimate possession of HighwayMaster,
without any restriction on disclosure; (c) subsequent to
disclosure hereunder, the information is lawfully received
from a third party having rights to disseminate the
information and without any restriction on disclosure; (d) is
obligated to be produced under order of a court of competent
jurisdiction or by means of other valid legal process;
provided, however, that HighwayMaster shall notify SBMS of
such order or process so SBMS may seek a protective order;
and/or (e) was independently developed by the HighwayMaster
without reference to or reliance on SBMS Information.
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 3
<PAGE> 4
1.24. "SBMS Market" means any domestic cellular market, whether an
MSA or an RSA or a combination thereof, for which SBMS or an
SBMS Affiliate holds the FCC license or in which SBMS or an
SBMS Affiliate manages or holds a controlling interest.
Attached hereto as Exhibit "A" is a list of all current SBMS
Markets.
1.25. "Services" means the administrative and settlement services to
be provided by SBMS to HighwayMaster for HighwayMaster's use
in connection with its provision of enhanced services to its
End-Users.
1.26. "SID" means the five (5) digit system identification code
assigned to a Market.
1.27. "Unit" means the HighwayMaster mobile communications unit.
1.28. "Voice CTS" means the use of cellular airtime services for the
purpose of transmitting voice communications via cellular
networks.
II. SBMS' OBLIGATIONS
2. SBMS' Obligations. In addition to the other covenants, terms and
conditions set forth in this Agreement, effective as of the Cutover
Date SBMS agrees to provide the following Services for HighwayMaster's
use in providing enhanced services to its End-Users in connection with
their use of the Units in any Covered Markets.
2.1. BID. SBMS will maintain the HighwayMaster BID for NPA/NXXs
solely for the use of HighwayMaster as permitted by any laws,
rules or regulations. The BIDs will permit identification of
Units in each Market as permitted by any laws, rules or
regulations.
2.2. Operational Services.
2.2.1. Visibility. SBMS will provide HighwayMaster with
access to Visibility services for the HighwayMaster
BID, subject to its ability to obtain GTE-TSI's
consent to do so.
2.2.2. SBMS will provide, or cause to be provided, to
HighwayMaster CIBER in collect tapes reflecting CTS
Usage associated with the HighwayMaster BID, subject
to its ability to obtain GTE-TSI's consent to do so.
Whether SBMS provides the tapes or causes them to be
provided directly to HighwayMaster by GTE-TSI shall
be decided in SBMS's sole discretion, as it deems
appropriate or feasible from time to time.
2.2.3. Within thirty (30) days of the end of each settlement
cycle, SBMS will provide HighwayMaster with a
financial summary consisting of charges by
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 4
<PAGE> 5
SBMS Carriers and Non-SBMS Carriers for CTS Usage
associated with the HighwayMaster BID in each
Carrier's respective Markets during that settlement
cycle, subject to its ability to obtain GTE-TSI's
consent to do so. SBMS will also provide CHARM
Reports to back up the summary, also subject to
GTE-TSI's consent.
2.2.3.1. As an alternative to the procedure set forth
in the preceding subsection, SBMS in its
sole discretion from time to time, may, with
GTE-TSI's consent, cause GTE-TSI to provide
HighwayMaster with access to the summary
financial information described above
through GTE-TSI's ACCESSibility service.
2.2.4. Following the close of each settlement cycle, SBMS
shall provide HighwayMaster with an invoice for the
Carrier Charges based upon the net settlement amounts
funded by SBMS with respect to the HighwayMaster BID.
2.3. Payment of Charges.
2.3.1. Net Settlement. SBMS shall act as HighwayMaster?s
payment agent for purposes of timely paying any and
all net settlement amounts charged by Carriers with
respect to NPA/NXXs and/or BID(s) assigned to
HighwayMaster or its End-Users in the Carrier?s
Market ("Carrier Charges"). The parties acknowledge
and understand that SBMS is merely acting as the
payment agent of HighwayMaster in connection with the
CIBERNET net settlement process and that
HighwayMaster is solely liable for any and all
amounts due Carriers for CTS Usage with respect to
the HighwayMaster BID.
2.3.2. Reimbursement. HighwayMaster shall reimburse SBMS for
any and all amounts paid by SBMS to Carriers for
Carrier Charges, regardless of whether such charges
were improperly invoiced or not. SBMS shall not have
any responsibility to investigate or determine
whether the Carrier Charges are correct, and
HighwayMaster has no defense to claims by SBMS for
amounts paid by it for Carrier Charges based upon the
impropriety of the Carrier Charges.
2.3.3. Improper Billing by Carriers. From time to time,
various carriers incorrectly rate or charge for CTS
Usage for cellular service provided to End-Users in
their Market. The parties anticipate that most
Carriers will sign the IRSA Addendum in the form of
that attached hereto as Exhibit 1. In those cases,
HighwayMaster will bear all responsibility for
seeking refunds for overcharges from the Carriers and
for making payments to Carriers for undercharges, and
will do so outside of the CIBERNET settlement
process. With respect to any Carrier(s) that are
unwilling to sign the Exhibit 1 form of IRSA Addendum
solely because of the paragraph 3 adjustment language
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 5
<PAGE> 6
therein, SBMS agrees to modify that language, and
SBMS and HighwayMaster agree to cooperate in
implementing a mutually acceptable mechanism for SBMS
to facilitate refunds from those Carriers for
improperly rated or charged CTS Usage.
2.3.4. HighwayMaster agrees to indemnify and hold harmless
SBMS from any and all claims, losses, damages, causes
of action, costs (including reasonable attorney's
fees) or reasonable expenses incurred by SBMS as a
result of any claim or action brought by a third
party and arising from the payment of amounts to
Carriers under this Agreement.
2.3.5. Alternative Billing Arrangements. Nothing herein
restricts HighwayMaster from entering into separate
agreements with Non-SBMS Carriers to establish
alternate standards, processes and arrangements by
which HighwayMaster would settle and be billed for
the use of such Non-SBMS Carrier's CTS ("Alternative
Billing Arrangements"), provided, that HighwayMaster
shall not be relieved of any of its obligations
hereunder. SBMS shall have no obligation to provide
any Services or assistance to HighwayMaster in
connection with the Alternative Billing Arrangement.
2.4. Provision of CTS.
2.4.1. SBMS Markets. HighwayMaster hereby authorizes SBMS
and SBMS agrees that it will negotiate and execute
IRSA Addenda and cause HighwayMaster to be provided
with CTS in the SBMS Markets under the same terms
(other than rates) that it negotiates such CTS access
in Non-SBMS Markets. To the extent that an SBMS
Market loses the required FCC license or other
necessary approvals, such SBMS Market shall have no
obligation to provide CTS to HighwayMaster.
2.4.2. Non-SBMS Markets. HighwayMaster hereby authorizes
SBMS and SBMS agrees that it will use commercially
reasonable efforts to negotiate and execute IRSA
Addenda in substantially the form of that attached
hereto as Exhibit 1 to cause HighwayMaster to be
provided with CTS in the Non-SBMS Markets. SBMS shall
ensure that its IRSA Addenda with the Non-SBMS
Carriers permit for rating of End-User CTS at the
rates set forth in HighwayMaster's CSAs with the
Non-SBMS Carriers. SBMS will have no liability to
HighwayMaster or any third party for its failure to
obtain IRSA Addenda from any particular Carriers or
from any particular number of Carriers either before
or after the Cutover Date. The terms and conditions
of all IRSA Addenda are confidential and proprietary
to SBMS and are subject to the provisions of this
Agreement relating to SBMS Information.
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 6
<PAGE> 7
III. SBMS' REPRESENTATIONS
3. SBMS' Representations.
3.1. Other Material Agreements. The execution, delivery and
performance of this Agreement does not conflict with or result
in a material breach of any provision of any material
agreement to which SBMS is a party.
3.2. Valid Execution. This Agreement has been duly executed and
delivered by an authorized representative of SBMS and
constitutes a valid and legally binding obligation of SBMS,
enforceable against it in accordance with its terms.
IV. HIGHWAYMASTER'S REPRESENTATIONS
4. HighwayMaster's Representations.
4.1. Other Material Agreements. The execution, delivery and
performance of this Agreement does not conflict with or result
in a material breach of any provision of any material
agreement to which HighwayMaster is a party.
4.2. Valid Execution. This Agreement has been duly executed and
delivered by an authorized representative of HighwayMaster and
constitutes a valid and legally binding obligation of
HighwayMaster, enforceable against it in accordance with its
terms.
V. HIGHWAYMASTER'S OBLIGATIONS
5. HighwayMaster's Obligations.
5.1. NPA/NXXs. HighwayMaster will provide to SBMS the NPA/NXX
combinations for its existing End-Users and all BIDs for those
NPA/NXXs. HighwayMaster's NPA/NXX combinations are currently
associated with a BID assigned to GTEW. HighwayMaster will
cause GTEW to cooperate with SBMS in assigning to SBMS the
NPA/NXXs and the BID with which they are associated.
HighwayMaster will ensure that the NPA/NXXs shall be in a
designated numbering system compatible with GTE
Telecommunications Systems Incorporated ("GTE-TSI") for
purposes of validation. The NPA/NXXs shall be stored and
maintained in a validation database at GTE-TSI (the
"HighwayMaster Database"). HighwayMaster and SBMS shall have
access to the HighwayMaster Database at all times during the
term of this Agreement and for a reasonable time period after
expiration or termination of this Agreement to allow each
party to perform or complete any outstanding billing or other
functions under this Agreement. [Text has been omitted
pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.]
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 7
<PAGE> 8
5.2. Negotiation of CTS Rates with Carriers. HighwayMaster is
solely responsible for the negotiation of any rates for CTS,
whether Voice CTS or Data CTS, and the execution of any CSAs
in Covered Markets. HighwayMaster will not sign any CSAs that
refer to SBMS or an administrative carrier without SBMS' prior
consent, nor will it sign any CSAs that conflict with the
terms of this Agreement. In order to permit SBMS to provide
the Services hereunder, HighwayMaster is required to notify
SBMS of the effective dates of, and supply SBMS with fully
executed copies of, any CSAs with Non-SBMS Markets.
HighwayMaster is also required to promptly notify SBMS of the
termination or expiration of any CSA. The terms and conditions
contained in these CSAs are confidential and proprietary to
HighwayMaster and are subject to the provisions of this
Agreement relating to HighwayMaster Information.
5.3. CTS Rates and Roaming Rates Acknowledgments. HighwayMaster
will be solely responsible for the negotiation and
establishment of CTS rates or other pricing with Non-SBMS
Carriers through its CSAs with the Non-SBMS Carriers.
HighwayMaster acknowledges that SBMS is not authorized and
cannot establish Roaming Rates for any Non-SBMS Market.
HighwayMaster acknowledges and agrees that it shall pay SBMS
an amount, including, but not limited to, the full amount of
all charges assessed by each Carrier with respect to
HighwayMaster NPA/NXXs and/or BIDs and paid by SBMS through
net settlement or otherwise. Nothing herein shall be construed
as requiring SBMS to offset any difference between the actual
rates charged by a Carrier in a particular Market and the
Roaming Rates or other rates requested or negotiated by
HighwayMaster with that Carrier. HighwayMaster further
acknowledges that IRSA Addenda between SBMS and the Non-SBMS
Carriers are subject to termination. To the extent any of the
IRSA Addenda are terminated, SBMS is not obligated to make
available Services in the Markets governed by such terminated
IRSA Addendum and SBMS shall have no obligation to
HighwayMaster for any damages, losses, or other effects of
such termination. SBMS will use commercially reasonable
efforts to maintain the IRSA Addenda with Non-SBMS Carriers.
5.4. Activations/Identification Changes. HighwayMaster shall be
responsible for all activations and identification changes
with respect to End-Users.
5.5. Technical Support. HighwayMaster shall be responsible for
responding to all End-User trouble tickets and will resolve
technical issues with Carriers and GTE-TSI.
5.6. Carrier Contacts. HighwayMaster will remain the point of
contact for Carriers with respect to rates, contract issues or
program changes. HighwayMaster shall handle all switch
configuration and network issues directly with each Carrier.
5.7. Regulatory and Legal Approvals. To the extent HighwayMaster is
required to obtain any federal, state, local or regulatory
approvals, licenses or certifications to provide enhanced
services to its End-Users, HighwayMaster is solely responsible
for
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 8
<PAGE> 9
obtaining such approvals, licenses or certifications.
HighwayMaster agrees to indemnify and hold harmless SBMS from
any claims, losses, damages, causes of action, costs
(including reasonable attorney's fees) or reasonable expenses
incurred by SBMS as a result of any claim or action brought by
a third party and arising from HighwayMaster's failure to
obtain any required licenses, approvals or other
certifications.
5.8. Technical Data Updates. SBMS and HighwayMaster will issue a
joint technical update to the Carriers explaining the
transition from HighwayMaster's prior administrative carrier
to SBMS. HighwayMaster shall compose and provide additional
technical data updates to all carriers at least two (2) times
per year, provided that HighwayMaster shall not release any
updates without prior written approval from SBMS, which
approval shall not be unreasonably withheld.
5.9. Technical Data Sheets. HighwayMaster will request and maintain
technical data sheets from Carriers for trouble resolution and
record maintenance.
5.10. CTS Restrictions. HighwayMaster, and not SBMS, shall be
responsible for informing Carriers of any required call
restrictions with respect to the HighwayMaster NPA/NXXs or
Units, [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed
separately with the SEC.] HighwayMaster acknowledges and
agrees that HighwayMaster will be solely responsible for any
amounts owed for CTS Usage or any other costs incurred in
Non-SBMS Markets where the Carrier does not provide or install
the required restrictions. HighwayMaster shall ensure that its
CSAs with Carriers impose obligations on the Carriers to
implement the dialing restrictions. HighwayMaster agrees to
maintain its current security and fraud prevention systems and
validation procedures in place and active, and to the extent
HighwayMaster ceases any such security protections,
HighwayMaster will be liable for fraudulent End-User CTS.
End-Users shall be permitted to dial 911 emergency services,
but HighwayMaster acknowledges that neither SBMS nor the SBMS
Markets provide or control the provision of 911 emergency
services in any Market.
VI. INTELLECTUAL PROPERTY
6. Intellectual Property.
6.1. No Assignment or License of Intellectual Property. Nothing
contained herein shall be construed to grant SBMS any right,
title or license in or to, whether express or implied, the
patents, copyrights, trademarks, trade secrets, mask works or
other proprietary rights of HighwayMaster or any improvements
and/or modifications thereto. Nothing contained herein shall
be construed to grant HighwayMaster any right, title or
license in or to, whether express or implied, the patents,
copyrights, trademarks, trade secrets, mask works or other
proprietary rights of SBMS or any improvements and/or
modifications thereto.
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 9
<PAGE> 10
6.2. Intellectual Property Indemnity. HighwayMaster agrees to
indemnify and hold SBMS harmless from and against any loss,
liability, damage or expense (including attorneys' fees and
court costs) that may result by reason of any infringement or
claim of infringement, of any entity's intellectual property
rights or other proprietary interest, arising out of any
services provided by HighwayMaster to End Users or Carriers.
This indemnity shall include, but is not limited to, any
claims by GTEW or its affiliates with respect to any
intellectual property employed by HighwayMaster. SBMS shall
promptly notify HighwayMaster of any claim for which it is
responsible hereunder.
VII. CONFIDENTIALITY
7. Confidentiality.
7.1. Ownership, Use and Confidentiality of HighwayMaster
Information. HighwayMaster Information shall remain the
property of HighwayMaster and its End-Users. SBMS may only use
the HighwayMaster Information to the extent set forth herein
or as required to perform the Services hereunder, unless SBMS
obtains the prior written consent of HighwayMaster to use the
HighwayMaster Information for another purpose. SBMS shall not
disclose the HighwayMaster Information to any third party
without the prior written consent of HighwayMaster. If SBMS
receives or is served with any order, subpoena, demand or
other request from a governmental agency, court, or other
legal forum to produce the HighwayMaster Information, in whole
or in part, SBMS will provide HighwayMaster with prompt notice
of such request so that HighwayMaster at its expense, may seek
a protective order or such other remedy to prevent production
of the HighwayMaster Information. If SBMS ultimately complies
with a proper request, SBMS will not be in violation of this
Section. Upon the termination or expiration of this Agreement
or, with respect to any HighwayMaster Information, on such
earlier date that SBMS in its opinion, shall no longer require
the HighwayMaster Information to provides the Services
hereunder, SBMS shall, at HighwayMaster's request, either
erase the HighwayMaster Information from any files maintained
by SBMS or return the HighwayMaster Information to
HighwayMaster. SBMS agrees to protect and safeguard the
confidentiality of the HighwayMaster Information to the same
degree and extent as SBMS protects and safeguards its own
confidential and proprietary information.
7.2. Ownership, Use and Confidentiality of SBMS Information. SBMS
Information shall remain the property of SBMS. HighwayMaster
may only use the SBMS Information to the extent set forth
herein or as required to perform its obligations hereunder,
unless HighwayMaster obtains the prior written consent of SBMS
to use the SBMS Information for another purpose. HighwayMaster
shall not disclose the SBMS Information to any third party
without the prior written consent of SBMS. If HighwayMaster
receives or is served with any order, subpoena, demand or
other
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 10
<PAGE> 11
request from a governmental agency, court, or other legal
forum to produce the SBMS Information, in whole or in part,
HighwayMaster will provide SBMS with prompt notice of such
request so that SBMS at its expense, may seek a protective
order or such other remedy to prevent production of the SBMS
Information. If HighwayMaster ultimately complies with a
proper request, HighwayMaster will not be in violation of this
Section. Upon the termination or expiration of this Agreement
or, with respect to any SBMS Information, on such earlier date
that HighwayMaster in its opinion, shall no longer require the
SBMS Information to perform its obligations hereunder,
HighwayMaster shall, at SBMS' request, either erase the SBMS
Information from any files maintained by HighwayMaster or
return the SBMS Information to SBMS. HighwayMaster agrees to
protect and safeguard the confidentiality of the SBMS
Information to the same degree and extent as HighwayMaster
protects and safeguards its own confidential and proprietary
information.
VIII. FEES AND INTEREST
8. Fees and Interest.
8.1. Monthly Administrative Carrier Fee. In exchange for the
Services provided hereunder to HighwayMaster by SBMS,
HighwayMaster shall pay to SBMS a monthly recurring
Administrative Carrier Fee within thirty (30) days of receipt
of an invoice for the same. Prior to the Cutover Date, the
Administrative Carrier Fee will be [Text has been omitted
pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.] per month.
After the Cutover Date the Administrative Carrier Fee will be
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with
the SEC.] per month.
8.2. Carrier Charge Reimbursement. HighwayMaster shall pay SBMS for
any and all Carrier Charges (including all SBMS and Non-SBMS
CTS and Roaming Charges) amounts paid by SBMS as set forth
elsewhere in this Agreement.
8.3. Clearinghouse Fees. [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has
been filed separately with the SEC.]
8.4. Late Payment. Any Administrative Carrier Fees, Carrier Charge
reimbursements or other charges or reimbursements not paid by
the due date shall accrue interest on the unpaid amount until
paid at the rate of 1 1/2 % per month or the maximum amount
allowed by law, whichever is less.
IX. TERM AND TERMINATION
9. Term and Termination.
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 11
<PAGE> 12
9.1. Initial Term. The initial term of this Agreement shall be for
a period of three years commencing on the date of execution of
this Agreement by both parties and ending on the third
anniversary of such date (the "Initial Term").
9.2. Renewal Term. Upon expiration of the Initial Term, this
Agreement shall automatically renew upon the same terms and
conditions for five (5) consecutive one (1) year renewal terms
(a "Renewal Term"), unless either party gives the other
written notice of its intent not to renew at least six (6)
months prior to the expiration of the existing Renewal Term.
9.3. Termination for Cause. In the event of a Material Default by
either party under this Agreement, the non-defaulting party
may terminate this Agreement by giving notice of such
termination to the other party to this Agreement, which notice
of termination shall specify a date no earlier than sixty (60)
days after the date such notice is given for such termination.
9.4. Termination for Nonpayment. In the event that HighwayMaster
fails to pay SBMS any amounts owed under this Agreement within
thirty (30) days of actual receipt of an Invoice and
HighwayMaster fails to fully cure such payment default within
ninety (90) days after notice by SBMS of such payment default,
then SBMS may terminate this Agreement by giving notice of
such termination to HighwayMaster, which notice of termination
shall specify a date no earlier than the date such notice is
given for such termination.
9.5. Termination for Insolvency. If HighwayMaster makes an
assignment for the benefit of creditors or files a voluntary
petition under Title 11 of the United States Code or under any
similar state insolvency laws or if HighwayMaster shall have
an involuntary petition for bankruptcy filed against it under
Title 11 of the United States Code and such involuntary
petition is not dismissed within thirty (30) days; or a
trustee or receiver is appointed to administer HighwayMaster's
business or assets, SBMS shall have the right to terminate
this Agreement effective upon notification of such termination
to HighwayMaster.
9.6. Termination for Impossibility. SBMS may terminate this
Agreement immediately upon written notice to HighwayMaster at
any time more than forty-five (45) days after the scheduled
Cutover Date if at such time HighwayMaster has not yet
effected the transfer of the HighwayMaster BID and associated
NPA/NXXs to SBMS.
9.7. Transition Period. Upon expiration of the Initial Term or any
Renewal Term or the termination of this Agreement under
Sections 9.2 or 9.3 (except when SBMS terminates HighwayMaster
as a result of a Material Default), SBMS shall continue to
provide the Services to HighwayMaster in accordance with the
terms and conditions of this Agreement for a period not to
exceed nine (9) months to permit
ADMINISTRATIVE CARRIER AGREEMENT
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<PAGE> 13
HighwayMaster to transition from SBMS to another party (the
"Transition Period"). At any time during the Transition
Period, HighwayMaster may terminate the provision of Service
by SBMS upon thirty (30) days written notice. Upon the
expiration of the Transition Period, SBMS shall have no
obligation to provide the Services to HighwayMaster under any
circumstances.
X. TRANSITION OF ADMINISTRATIVE CARRIERS
10. The Parties agree to the following provisions in connection with
HighwayMaster's transition of administrative carriers from GTEW to
SBMS:
10.1. The Cutover Date will be September 30, 1999, unless an earlier
date is agreed to in writing by the parties hereto.
10.2. HighwayMaster will cause GTEW to cooperate with SBMS in
assigning to SBMS the NPA/NXXs and the BID with which they are
associated effective as of the Cutover Date. HighwayMaster
will cause any existing GTEW roaming addenda that address
HighwayMaster service to terminate on or before the Cutover
Date. HighwayMaster will cause any existing Cellular Service
Agreements that reference GTEW as its administrative carrier
or that SBMS has not approved to terminate on or before the
Cutover Date.
10.3. HighwayMaster will use commercially reasonable efforts to sign
Cellular Service Agreements with as many of SBMS' domestic
cellular roaming partners as possible to be effective as of
the Cutover Date. HighwayMaster will continue its efforts to
sign up Carriers after the Cutover Date.
10.4. SBMS will use commercially reasonable efforts to sign IRSA
Addenda substantially in the form of that attached as Exhibit
1 hereto with as many of its domestic cellular roaming
partners as possible to be effective as of the Cutover Date.
SBMS will continue its efforts to sign up Carriers after the
Cutover Date in accordance with Section 2.4 above.
10.5. SBMS and HighwayMaster will coordinate their respective
efforts to obtain IRSA Addenda and Cellular Service Agreements
from the same Carriers.
XI. MISCELLANEOUS
11. Miscellaneous.
11.1. Force Majeure. Each party hereto shall be excused from
performance hereunder for any period and to the extent that it
is prevented from performing any action pursuant hereto, in
whole or in part, as a result of delays beyond its control
caused by the other party or by an act of God or the public
enemy, fire, floods, epidemics, quarantine
ADMINISTRATIVE CARRIER AGREEMENT
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<PAGE> 14
restrictions, civil disturbance, court order, labor dispute,
third party nonperformance (except to the extent such third
party nonperformance is wrongfully caused by a party to this
Agreement), or other cause beyond its control, including
without limitation failures or fluctuations in electrical
power, heat, light or air conditioning.
11.2. Single Point of Contact. SBMS and HighwayMaster shall each
identify in writing, subject to change at any time, a single
point of contact to coordinate activations, identify existing
problems with the provision of the Services by SBMS. Each
party will provide a contact person with adequate technical
knowledge and understanding of the mutual obligations
hereunder and such contact person will be available on a
regular basis Monday through Friday from 8:00 a.m. to 5:00
p.m. Central Standard Time.
11.3. Severability. Any provision of this Agreement which is
prohibited, unenforceable or is declared or found to be
illegal, unenforceable or void, in any jurisdiction shall, as
to such jurisdiction, be ineffective only to the extent of
such prohibition or unenforceability without invalidating the
remainder of such provision or the remaining provisions of
this Agreement or affecting the validity or enforceability of
such provision in any other jurisdiction.
11.4. Nondisclosure/Media Releases. All media releases, public
announcements and public disclosures by any party hereto
relating to this Agreement or its subject matter, including
without limitation promotional or marketing material, but not
including any announcement intended solely for internal
distribution or any disclosure required by legal, accounting
or regulatory requirements beyond the reasonable control of
such party, shall be coordinated with and approved by the
other party hereto prior to the release thereof, which
approval shall not be unreasonably withheld or delayed. The
terms of this Agreement are confidential except that either
party may disclose the terms of this Agreement to any of its
employees, consultants or professionals on a "need to know
basis" to permit performance hereunder. Neither party shall
announce or disclose to any third party, the terms and
conditions contained herein or any discussions relating
thereto, without the prior written consent of the other party,
except as required by law, in which case the party required to
make disclosure shall give the other party prompt notice of
any such requirement so that the other party can take any
actions it deems appropriate to protect the information from
disclosure. Notwithstanding the above, HighwayMaster shall be
permitted to disclose this Agreement to the Securities and
Exchange Commission ("SEC") and file it therewith, as
required. HighwayMaster shall provide the SEC with a clean and
redacted copy of the Agreement to indicate to the SEC which
Sections should be redacted and unavailable for public review.
A copy of the Agreement with the proposed redactions will be
provided to SBMS twenty (20) business days prior to filing the
Agreement with the SEC, and SBMS shall have such twenty (20)
business days to request additional or different redactions.
In the event no such comments are provided to HighwayMaster by
SBMS in such time period, HighwayMaster shall be authorized to
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 14
<PAGE> 15
file this Agreement with the SEC in the form given to SBMS for
review. To the extent the SEC or HighwayMaster determines that
any requested redactions are not allowed by the SEC,
HighwayMaster must notify SBMS of the specific changes
required by the SEC prior to filing this Agreement with the
SEC.
11.5. Notices. Any notice required by this Agreement must be given
by depositing a copy of such notice (i) in the United States
mail, postage prepaid, certified return receipt requested or
(ii) in overnight delivery or (ii) via facsimile. Any such
notice will be deemed to be received upon the earlier of
verification of delivery or on the third day after depositing
a copy of such notice in the mail or overnight delivery,
except that notices received by facsimile shall only be deemed
effective upon actual receipt by the individual with the title
set forth below as confirmed solely by such individual. Any
such notice will be given at the following addresses or to
such later addresses of which the sending party has received
actual or constructive notice:
If to HighwayMaster:
HighwayMaster Corporation
1155 Kas Drive
Richardson, Texas 75081
Attention: General Counsel
FAX No.: (972) 301-2263
If to SBMS:
Southwestern Bell Mobile Systems, Inc.
17330 Preston Road, Suite 100A
Dallas, Texas 75252
Attention: Director, Intercarrier Services
FAX No.: 972-733-6155
With a copy to:
Southwestern Bell Mobile Systems, Inc.
17330 Preston Road, Suite 100A
Dallas, Texas 75252
Attention: Vice President, Secretary, and General Counsel
FAX No.: 972-733-2021
11.6. Legal Representation. HighwayMaster acknowledges that SBMS has
offered no legal advice or counsel to HighwayMaster nor made
any representations to HighwayMaster regarding HighwayMaster's
exemption from the jurisdiction of federal, state, or local
governmental agencies with potential jurisdiction over the
parties herein and the Services to be rendered hereunder and
SBMS has not offered HighwayMaster any legal advice or counsel
regarding the subject matter of this Agreement. SBMS
acknowledges that HighwayMaster has offered no legal advice or
counsel to SBMS nor made any representations to SBMS regarding
SBMS' exemption from the
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 15
<PAGE> 16
jurisdiction of federal, state, or local governmental agencies
with potential jurisdiction over the parties herein and the
Services and obligations to be rendered hereunder and
HighwayMaster has not offered SBMS any legal advice or counsel
regarding the subject matter of this Agreement.
11.7. Interpretation. Headings used in this Agreement are for
convenience only and will not be deemed to be operative text.
Terms of gender will be deemed interchangeable, as will
singular and plural terms, in each case unless the context
otherwise requires.
11.8. Execution. This Agreement shall be deemed to be executed at
such time as all parties hereto have signed a counterpart
hereof and each party hereto has received from each of the
other parties hereto an originally-signed counterpart or a
facsimile transmission or other replication of an
originally-signed counterpart.
11.9. Waiver. The failure of either party to enforce, in any one or
more instances, performance of any of the terms, covenants or
conditions of this Agreement shall not be construed as a
waiver or a relinquishment of any right or claim granted or
arising hereunder or of the future performance of any such
term, covenant, or condition, and such failure shall in no way
affect the validity of this Agreement or the rights and
obligations of the parties hereto. The parties acknowledge
that a waiver of any term or provision hereof may only be
given by a written instrument executed by the party granting
the waiver.
11.10. WARRANTY DISCLAIMER. SBMS' AND HIGHWAYMASTER'S OBLIGATIONS
HEREUNDER ARE IN LIEU OF ALL WARRANTIES, EXPRESS OR IMPLIED.
SBMS MAKES NO WARRANTIES, EXPRESS OR IMPLIED REGARDING ANY
GOODS, SERVICES OR EQUIPMENT TO BE PROVIDED HEREIN, OR AS TO
ANY CTS TO BE PROVIDED IN ANY SBMS MARKETS INCLUDING ANY
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.
11.11. NO LIABILITY FOR INDIRECT DAMAGES. SBMS SHALL NOT BE LIABLE TO
HIGHWAYMASTER OR ANY THIRD PARTY, AND HIGHWAYMASTER SHALL NOT
BE LIABLE TO SBMS OR ANY THIRD PARTY, FOR INDIRECT,
INCIDENTAL, CONSEQUENTIAL, RELIANCE, OR SPECIAL DAMAGES,
INCLUDING WITHOUT LIMITATION, DAMAGES FOR LOST PROFITS,
REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT,
INDEMNITY, WARRANTY, STRICT LIABILITY OR TORT, ARISING FROM OR
RELATED TO THEIR PERFORMANCE OR NON-PERFORMANCE HEREUNDER.
11.12. LIMITATION OF LIABILITY. THE LIABILITY OF EITHER PARTY FOR ANY
CLAIM ASSERTED BY THE OTHER PARTY OR ANY THIRD PARTY ARISING
OUT OF THIS AGREEMENT (OTHER THAN CLAIMS BY SBMS FOR
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 16
<PAGE> 17
REIMBURSEMENT OF CARRIER CHARGES OR INTELLECTUAL PROPERTY
INDEMNITY IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT)
SHALL BE LIMITED TO AN AMOUNT EQUAL TO THE TOTAL AMOUNTS
INVOICED TO HIGHWAYMASTER IN THE TWELVE (12) MONTH PERIOD
IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO THE CLAIM.
11.13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original,
and all of which together shall constitute one and the same
instrument notwithstanding that all parties are not
signatories to each counterpart.
11.14. Assignability and Binding Effect. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and
their respective successors and permitted assigns. No party
may assign this Agreement without the prior written consent of
the other party hereto; provided, however, that SBMS may
assign this Agreement, and its rights and obligations
hereunder, to any of its Affiliates without the consent of any
other party.
11.15. Amendments. This Agreement may not be modified, amended or
supplemented except by an agreement in writing signed by all
of the parties hereto. Neither party shall accept or act upon
any instructions, directions, and/or modifications concerning
that party's performance hereunder which would affect the
terms, conditions, and/or pricing of this Agreement unless
authorized by the other party.
11.16. Expenses, Taxes, Etc. Each of the parties hereto shall pay all
fees and expenses incurred by it in connection with the
preparation and negotiation of this Agreement. There shall be
added to any charges incurred and payable by HighwayMaster
under this Agreement, an amount equal to any tariff, duty, or
levy tax including but not limited to sales, ad valorem and
use tax or any tax in lieu thereof imposed by any local,
state, or federal government or governmental agency with
respect to the Services or with respect to this Agreement, but
in no event will taxes be paid by HighwayMaster which are
based on the income or net worth of SBMS.
11.17. Third Parties. Except as expressly provided herein, nothing
herein expressed or implied is intended or shall be construed
to confer upon or give to any individual or entity other than
the parties hereto and their successors or permitted assigns,
any rights, benefits or remedies of any kind or character
whatsoever under or by reason of this Agreement.
11.18. Attorneys' Fees. Except as herein expressly provided, in any
arbitration, suit, action or proceeding brought by one party
against the other party under this Agreement, or where any
provision hereof is validly asserted as a defense, the
prevailing party shall be entitled to recover reasonable
attorneys' fees in addition to any other available remedy,
subject to the limitation of liabilities set forth herein.
ADMINISTRATIVE CARRIER AGREEMENT
PAGE - 17
<PAGE> 18
11.19. Independent Contractor. SBMS is providing the Services as an
independent contractor. This Agreement shall not be construed
to create a joint venture, partnership, employment
relationship, franchise or any other legal relationship
between the parties other than that of independent contractor.
Neither party shall share or be responsible for the debts and
liabilities of the other party, or have the authority to bind
the other party in any manner.
11.20. Entire Agreement. This Agreement, together with all Exhibits
attached hereto and expressly made a part of this Agreement,
shall constitute the entire agreement between the parties
hereto with respect to the Services and shall supersede all
prior proposals, negotiations, understandings and agreements,
whether oral or written.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first above written.
HIGHWAYMASTER CORPORATION,
A DELAWARE CORPORATION
By: (x) William H. McCausland
-----------------------------
Name: William H. McCausland
---------------------------
Title: Sr. V. P. - Operations
--------------------------
Date: March 30, 1999
--------------------------
SOUTHWESTERN BELL
MOBILE SYSTEMS, INC.
A VIRGINIA AND DELAWARE CORPORATION
By: (x) Lisa Guarnacci for Frank Boyer
-----------------------------
Name: Frank Boyer
---------------------------
Title: V. P. Product Development
--------------------------
Date: March 30, 1999
--------------------------
ADMINISTRATIVE CARRIER AGREEMENT
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<PAGE> 19
EXHIBIT 1
ADDENDUM TO INTERCARRIER ROAMER SERVICE AGREEMENT
This Addendum is made by and between SOUTHWESTERN BELL MOBILE SYSTEMS,
INC. on behalf of itself and its affiliates ("SBMS") AND [FILL IN CARRIER NAME],
on behalf of itself and its affiliates ("CARRIER").
WHEREAS, SBMS has signed an Administrative Carrier Agreement ("ACA")
with HighwayMaster Corporation ("HighwayMaster");
WHEREAS, Carrier desires to facilitate the provision of cellular roamer
service to end users of the HighwayMaster System and has signed or intends to
sign a Cellular Service Agreement with HighwayMaster to set rates and other
terms and conditions of the service to be provided by Carrier to HighwayMaster's
end users;
WHEREAS, in recognition of the unique requirements of HighwayMaster's
end users, including members of the long haul trucking industry and other
similarly situated industries with nomadic travel patterns, the Parties hereto
have assented to amend the IRSA(s) in accordance with the provisions set forth
herein;
NOW, THEREFORE, it is agreed as follows:
1. This Addendum shall amend the Intercarrier Roamer Service Agreement(s)
listed on Attachment A hereto (the "IRSA(s)"), along with any replacement
intercarrier roamer service agreements intended to replace, modify or
supersede the IRSAs. The provisions set forth herein are incorporated by
reference and shall become a part thereof. In the event that the IRSA(s) is
assigned in accordance with its terms, this Addendum shall be assigned
along with the IRSA(s).
2. Pursuant to the provisions herein stated, Carrier agrees for the term of
this Addendum to provide roaming service in accordance herewith in those
cellular markets set forth on Attachment B at the rates established by and
between Carrier and HighwayMaster. It is expressly understood and agreed
that SBMS shall have no responsibility for negotiating or setting rates for
the service to be provided by Carrier to HighwayMaster End Users.
3. SBMS is providing administrative and settlement functions for
HighwayMaster. SBMS shall participate with Carrier in the net settlement
process and provide the settlement funding account with respect to the
HighwayMaster BID(s). Notwithstanding the foregoing, HighwayMaster is the
party ultimately responsible for all of the cost of services for system
usage on Carrier's systems, at the rates set between HighwayMaster and
Carrier. Therefore, both parties agree that any disputes or adjustments
regarding Carrier's charges with respect to the HighwayMaster BID(s) shall
be handled directly between Carrier and HighwayMaster, and that any
mechanisms created by CIBERNET to adjust charges related to billing through
the Net Settlement Program will not be used with respect to the
HighwayMaster BID. HighwayMaster shall be entitled to seek amounts for any
1
<PAGE> 20
overcharges directly from Carrier, and Carrier shall be required to seek
amounts for any undercharges directly from HighwayMaster, and not SBMS.
4. SBMS shall notify Carrier of the NPA/NXX combinations created solely for
use by roamers as defined herein, which NPA/NXXs will be associated with a
unique HighwayMaster billing identification ("BID") assigned to SBMS. The
NPA/NXX's are not dialable from the Public Switched Telephone Network and
can only be successfully called through the HighwayMaster Network Services
Center. The HighwayMaster BID will be used nationally to identify vehicles
equipped with the HighwayMaster system. HighwayMaster will provide Carrier
with all updates of NPA/NXXs used for the purposes of this application.
HighwayMaster will provide Industry Standard Updates which shall be listed
on HighwayMaster's Technical Data Sheets. All assigned numbers will be
stored in a validation database, jointly maintained by TSI and
HighwayMaster. HighwayMaster shall provide activations, ESN changes and
updates to the database.
5. Term and Termination.
5.1. The term of this Addendum shall commence on the later of (a) the
Cutover Date under the ACA (which shall be no later than December 20,
1999); (b) the effective date of the Cellular Service Agreement
between Carrier and HighwayMaster; or (c) the date that the
HighwayMaster BID and NPA/NXXs are transferred from HighwayMaster's
current administrative carrier to SBMS; and shall continue for an
Initial Term of one (1) year. Thereafter, it shall renew for
successive one year terms, provided that either Party may terminate
this Addendum by providing written notice of termination to the other
at least sixty (60) days prior to the end of the Initial Term or any
Renewal Term.
5.2. This Addendum shall automatically terminate with respect to any
Carrier markets covered by an IRSA that expires or is terminated and
not replaced or superseded with another intercarrier roamer service
agreement between SBMS and Carrier.
5.3. SBMS may terminate this Agreement immediately upon written notice to
Carrier that: (a) the ACA between SBMS and HighwayMaster has
terminated; or (b) HighwayMaster has notified SBMS that the Cellular
Service Agreement between Carrier and HighwayMaster has terminated.
For purposes of this section, SBMS shall be entitled to rely solely on
notification from HighwayMaster with respect to whether the Cellular
Service Agreement between Carrier and HighwayMaster has terminated.
6. Neither Party hereto shall be liable to the other Party or any third party,
including affiliates, subsidiaries or partnership interests, for indirect,
incidental, consequential, reliance or special damages, including, without
limitation, damages for lost profits, regardless of the form of action
whether in contact, indemnify, warranty, strict liability or tort arising
from or related to the performance of the duties of either Party in
accordance with the terms set forth herein or the rendering of services
hereunder.
7. The Parties agree that HighwayMaster is an intended third-party beneficiary
of this Addendum.
2
<PAGE> 21
8. To the extent that the provisions of the Addendum conflict with the
IRSA(s), this Addendum shall control.
9. This Addendum may only be modified by written agreement of the Parties
hereto.
Southwestern Bell Mobile Systems, Inc. [CARRIER NAME]
By: By:
------------------------------- -------------------------------
Name: Name:
------------------------------- -------------------------------
Title: Title:
------------------------------- -------------------------------
Date: Date:
------------------------------- -------------------------------
3
<PAGE> 1
EXHIBIT 10.37
ADDENDUM TO AGREEMENT
THIS ADDENDUM is made this 20th day of October, 1998 by and between
INTERNATIONAL TELECOMMUNICATION DATA SYSTEMS, INC. ("ITDS"), a Delaware
corporation with principal offices at 225 High Ridge Road, Stamford, Connecticut
06905, and HIGHWAY MASTER CORPORATION, a Delaware corporation with principal
offices at 1155 Kas Drive, Richardson, Texas 75081 ("Customer").
WHEREAS, the parties have entered into a Software License Agreement, dated April
30, 1996 (the "Agreement"), and
WHEREAS, ITDS and Customer desire to amend the terms of the Agreement by
extending the term of the Agreement for an additional three years, replacing the
price chart attached to the Agreement.
In consideration of the promises and the mutual covenants and
agreements hereinafter set forth, ITDS and Customer agree as follows:
1. The Highway Master Pricing Chart attached to the Agreement, as
SCHEDULE B is hereby deleted and omitted in its entirety and is hereby replaced
with the PRICE CHART EFFECTIVE Cycle 09-98, which is attached hereto and
incorporated into the Agreement.
2. The first sentence of Section 2.1 of the Agreement is hereby deleted
and omitted in its entirety and is replaced with the following:
"The initial term of this Agreement shall commence upon the
execution hereof and shall continue until September 1, 2002."
3. [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
4. ITDS represents and warrants that its product and service provided
under this agreement are year 2000 compliant.
5. The first phrase of the last sentence of Section 3.1 which reads
"Notwithstanding anything to the contrary contained in the Agreement" shall be
deleted.
6. Section 3.1 of the contract shall be amended by adding the following
sentence to the end: [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.]
Except as expressly and specifically modified by the terms of this
Agreement, the parties hereby ratify and confirm all of the terms and conditions
of the Agreement. This Addendum to the Agreement shall also be considered to be
legally binding and incorporated into the above referenced Agreement when
executed by all parties.
<PAGE> 2
IN WITNESS WHEREOF, the parties have executed this Agreement.
INTERNATIONAL TELECOMMUNICATION HIGHWAY MASTER CORPORATION
DATA SYSTEMS, INC.
By: (x) Peter P. Bassermann By (x) Jana Bell
------------------------------------- --------------------------------
Peter P. Bassermann Name: Jana Bell
President -----------------------------
Date: 2-4-99 Title: President & CEO
----------------- ----------------------------
Date: 2/2/99
-----------------------------
2
<PAGE> 3
SCHEDULE B
HIGHWAYMASTER PRICING
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
3
<PAGE> 1
EXHIBIT 10.38
SECOND ADDENDUM TO AGREEMENT
THIS ADDENDUM is made this 31st day of January, 1999 by and between
INTERNATIONAL TELECOMMUNICATION DATA SYSTEMS, INC. ("ITDS"), a Delaware
corporation with principal offices at 225 High Ridge Road, Stamford, Connecticut
06905, and HIGHWAY MASTER CORPORATION, a Delaware corporation with principal
offices at 1155 Kas Drive, Richardson, Texas 75081 ("Customer").
WHEREAS, the parties have entered into a Software License Agreement,
dated April 30, 1996 which was amended by an Addendum to Agreement dated October
20, 1998(collectively, the "Agreement"), and
WHEREAS, ITDS and Customer desire to amend the terms of the Agreement
by incorporating service levels and providing Customer a cancellation provision.
In consideration of the promises and the mutual covenants and
agreements hereinafter set forth, ITDS and Customer agree as follows:
1. Schedule F attached hereto entitled "Service Level Matrix" is
hereby incorporated into the Agreement.
2. Schedule G attached hereto is hereby incorporated into the
Agreement.
3. Schedule H attached hereto entitled "Examples of Comprehensive
JobR Specifications" is hereby incorporated into the Agreement.
4. Schedule I attached hereto entitled "Computer Output Systems
Performance Table" is hereby incorporated into the Agreement.
5. Schedule J attached hereto is hereby incorporated into the
Agreement.
6. Schedule K attached hereto is hereby incorporated into the
Agreement.
Except as expressly and specifically modified by the terms of this
Second Addendum, the parties hereby ratify and confirm all of the terms
and conditions of the Agreement. This Second Addendum to the Agreement
shall also be considered to be legally binding and incorporated into
the above referenced Agreement when executed by all parties.
IN WITNESS WHEREOF, the parties have executed this Agreement:
INTERNATIONAL TELECOMMUNICATION HIGHWAY MASTER CORPORATION
DATA SYSTEMS, INC.
By: (x) Peter P. Bassermann By (x) Jana Bell
------------------------------------- --------------------------------
Peter P. Bassermann Name: Jana Bell
President -----------------------------
Date: 2-4-99 Title: President & CEO
----------------- ----------------------------
Date: 2/2/99
-----------------------------
<PAGE> 2
SCHEDULE F
SERVICE LEVEL MATRIX
ITDS' performance in each of the service levels will be reported in the monthly
Report Card.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
<PAGE> 3
SCHEDULE "G"
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
<PAGE> 4
SCHEDULE H
EXAMPLES OF COMPREHENSIVE JOBR SPECIFICATIONS
To Be Provided
<PAGE> 5
SCHEDULE I
COMPUTER OUTPUT SYSTEMS PERFORMANCE TABLE
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
<PAGE> 6
SCHEDULE J
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
<PAGE> 7
SCHEDULE K
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
<PAGE> 1
EXHIBIT 10.39
MANUFACTURING AND EQUIPMENT PURCHASE AGREEMENT
This manufacturing and equipment purchase agreement (the "Agreement")
is made and entered into this the ___ day of February, 1999, by and between
Wireless Link Corporation whose principle place of business is 1909 Milmont
Drive, Milpitas, California, 95035 (hereinafter referred to as "Wireless Link")
and HighwayMaster Corporation whose principle place of business is 1155 Kas
Drive, Richardson, Texas, 75081 (hereinafter referred to as "HIGHWAYMASTER").
The terms and conditions contained herein apply to the manufacture of mobile
communication products and the related material procurement, inventory, test and
packaging thereof.
RECITALS:
A. WIRELESS LINK is engaged in the business of designing, manufacturing
and selling communications products and possesses certain rights to technology
used in a wireless asset-tracking product (referred to hereinafter as the
"Wireless Product").
B. HIGHWAYMASTER wishes to engage WIRELESS LINK to manufacture a module
which will meet the specifications set forth in Attachment A attached hereto
(the "Modified Wireless Product"), which HIGHWAYMASTER will market under its own
trade names and trademarks.
C. WIRELESS LINK and HIGHWAYMASTER desire to set forth herein the terms
and conditions for the purchase and sale of the Modified Wireless Product
manufactured by WIRELESS LINK.
NOW, THEREFORE, in consideration of the recitals, mutual covenants and
terms and conditions herein contained, the parties hereto agree as follows:
1. Term of Agreement
The Effective Date of this Agreement shall be January 22, 1999, and shall
continue unless terminated by either party with ninety (90) days written notice,
or under other sections of this Agreement.
The terms and conditions contained in this Agreement shall have precedence over
individual purchase orders or other documents referenced herein, unless this
Agreement is amended in writing.
2. Products and Pricing
Products covered by this Agreement and applicable prices are listed by part
number in Attachment B. From time-to-time, additional products may be
incorporated into or removed from this Agreement by revision to Attachment B
agreed upon by HIGHWAYMASTER and WIRELESS LINK in writing. The initial prices
reflected in Attachment B are the baseline for this Agreement. Pricing is to be
reviewed on a quarterly basis.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 1
<PAGE> 2
3. Purchase Orders
Purchase orders will be issued by HIGHWAYMASTER to WIRELESS LINK for the
Modified Wireless Product. HIGHWAYMASTER will issue a purchase order each
quarter for the Modified Wireless Product. Each purchase order shall include a
purchase commitment for the [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] following the issuance of the purchase order as specifically defined
hereinafter. Specifically, the purchase order shall include quantity purchase
commitments for each of the [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] periods of the [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] With respect to the initial [Text has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed separately with
the SEC.], HIGHWAYMASTER is obligated to take delivery of and pay for [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.] of the quantity specified in
the purchase order for the initial [Text has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed separately with
the SEC.] With respect to the second [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.], HIGHWAYMASTER may delay or cancel up to for [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.] of the quantity specified in the purchase order
without penalty or increase said specified quantity by [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.] without penalty. With respect to the final [Text
has been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.] HIGHWAYMASTER may delay or
cancel up to [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] of the
quantity specified in the purchase order without penalty or increase said
specified quantity by [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] without penalty. The initial purchase order will be issued no less than
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] before expected
delivery of the Modified Wireless Product units. Subsequent purchase orders will
be issued no less than [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] prior to the start of each additional quarter for the forecasted
production quantities for that quarter.
4. Scheduling
HIGHWAYMASTER will send to WIRELESS LINK each month an updated 12 month rolling
forecast for the Modified Wireless Product. The rolling forecast will be divided
into weekly requirements for the next 3 months, monthly requirements for the
following 3 months and quarterly
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 2
<PAGE> 3
requirements for the next 6 months. WIRELESS LINK will respond to the monthly
update as authorization to manufacture for shipment per the forecast with
adjustments as may be necessary to meet Kanban requirements as described in
Attachment C hereto.
WIRELESS LINK will accommodate increases over the current month's scheduled
build quantity. However, increases in scheduled deliveries will require review
of material and manpower prior to advising HIGHWAYMASTER if such increase can be
accomplished. In cases where HIGHWAYMASTER' requirements exceed the immediate
release quantity, equitable adjustments will be made by HIGHWAYMASTER for any
agreed upon expediting costs incurred by WIRELESS LINK.
5. Strategic Inventory
It is recognized that the forecast supplied by HIGHWAYMASTER for [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.] is speculative and is subject to change
from month to month; therefore, WIRELESS LINK will place cancelable orders with
vendors to support [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] except
for long lead time components and non-cancelable, non-returnable components as
described below. [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] of the
forecast for the next calendar quarter will be considered a firm order subject
to cancellation charges as defined herein. In the event of a cancellation or
decline in [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] firm
requirements, HIGHWAYMASTER will be liable (to the extent of the cancellation or
decline) for the cost of WIRELESS LINK's non-cancelable orders with vendors
(including long lead time and non-cancelable, non-returnable orders as described
below), non-returnable components on hand, work in process material (and direct
out-of-pocket labor costs previously incurred in manufacturing the work in
progress), and kanban quantities on hand (per Attachment C). In order for
WIRELESS LINK to be entitled to such payments, it must have HighwayMaster's
advance written approval for non-cancelable orders, long lead time orders,
non-returnable components, [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] manufacturing schedules (approval for one month worth of components is
considered to be the monthly forecast transmitted to WIRELESS LINK). Finished
goods and work in process will be purchased at the resale price, components at
the quoted standard cost. If it is not possible for WIRELESS LINK to adjust
inventories by slower production, negotiating adjustments in supplier schedules,
or other similar means, HIGHWAYMASTER will issue a purchase order to WIRELESS
LINK for parts that become excess due to the above clause within thirty (30)
days of being notified of the situation from WIRELESS LINK.
Some parts of the Modified Wireless Product have standard procurement lead times
of [Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.], and therefore, should
be considered strategic inventory.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 3
<PAGE> 4
HIGHWAYMASTER authorizes WIRELESS LINK to place up to [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.] of these parts on order with vendors in
accordance with the provided forecast at WIRELESS LINK'S discretion. WIRELESS
LINK is similarly authorized to reorder those long lead items as the lead time
frame is encountered and inventory levels become exhausted. These lead times
will be supported by documentation from WIRELESS LINK'S vendor. In the event
that components have lead times in excess of [Text has been omitted pursuant to
a request for confidential treatment. The omitted material has been filed
separately with the SEC.], WIRELESS LINK will inform HIGHWAYMASTER of such and
will not place such long-term orders until it has obtained prior written
approval from HIGHWAYMASTER. Purchase orders placed under this condition must
have a reschedule and cancellation clause on them, meaning that they must allow
for rescheduling of delivery times and cancellation under certain conditions,
without penalty. Prior to issuing a non-cancelable/non-returnable ("NCNR")
purchase order, WIRELESS LINK will inform HIGHWAYMASTER and will not place such
NCNR purchase order until obtaining advance written approval from HIGHWAYMASTER.
HIGHWAYMASTER will respond to requests for NCNR orders promptly. WIRELESS LINK
shall provide HIGHWAYMASTER with a list of vendors identified as providing
non-cancelable, non-returnable components or long lead times to deliver
components upon the execution of this Agreement.
WIRELESS LINK will maintain and manage the "on-order" positions for strategic
inventory components. WIRELESS LINK'S liability will be to manage this excess to
the best of its abilities, which includes reschedule in and out of material as
required, given the HIGHWAYMASTER inputs and market conditions.
WIRELESS LINK will regularly review its non-cancelable orders with vendors
(including long lead time and non-cancelable, non-returnable orders),
non-returnable components on hand, levels of work in process material (and
direct out-of-pocket labor costs previously incurred in manufacturing the work
in progress), and KANBAN quantities on hand with the goal toward continual
reductions in these items, including possible re-negotiation of unfavorable
contracts with vendors when circumstances permit it.
If HIGHWAYMASTER is required by this Agreement to pay for costs billed by third
parties associated with non-cancelable orders (including long lead time,
non-cancelable, and non-returnable orders) and non-returnable items on hand,
HIGHWAYMASTER will first have the option of purchasing the items from the third
party, assuming the contract with the third party supplier or otherwise dealing
directly with the supplier to determine ways in which HIGHWAYMASTER could
encourage the supplier to reduce lead times, non-cancelable restrictions, and
non-returnable restrictions.
6. Shipment Authorization
HIGHWAY MASTER will provide WIRELESS LINK with weekly shipping instructions for
products to be shipped in the following month. All products will be shipped to
HIGHWAYMASTER'S warehouse.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 4
<PAGE> 5
HIGHWAYMASTER may adjust up or down the quantities of products that it orders
WIRELESS LINK to ship subject to the terms of Paragraph 3 of this Agreement
entitled "Purchase Orders." This adjustment will be made by the weekly shipment
releases to WIRELESS LINK. To accommodate unplanned requirements, a FAX can be
utilized to initiate an adjustment, however, this must be followed with written
notification within five (5) working days.
At the time of each shipment, WIRELESS LINK will provide, by shipment, a list of
electronic serial numbers ("ESN") and mobile identification numbers ("MINS")for
all units shipped in addition to the shipper information identifying customer,
carrier, tracking number and ship date. If at any time WIRELESS LINK has in its
possession finished goods or other inventory which has been purchased by
HIGHWAYMASTER, it will keep such items in a separately-locked warehouse space or
cage accessible to HIGHWAYMASTER and limited to authorized WIRELESS LINK
personnel, with the cage contents labeled as "PROPERTY OF HIGHWAYMASTER. The
warehousing may be subject to warehousing fees if the warehousing period exceeds
five (5) working days.
7. Transportation Costs
The costs of transportation for shipment of products, except for products
returned to WIRELESS LINK for repair under Limited Warranty set forth in
paragraph 12 below herein, will be the responsibility of HIGHWAYMASTER.
HIGHWAYMASTER will provide WIRELESS LINK with the approved carriers to be used
for such transportation. Freight costs will be billed directly to HIGHWAYMASTER
by these carriers. WIRELESS LINK shall package and pack the products as
indicated/or approved by HIGHWAYMASTER which will provide protection against
damage during shipment, handling, and storage, and will enable HIGHWAYMASTER or
HIGHWAYMASTER'S customer to easily identify the contents of the package.
In the event of WIRELESS LINK'S inability to deliver product for shipment as
committed, WIRELESS LINK agrees to revise the ship method and pay the difference
in freight. This may include alternate ship methods such as airfreight. Requests
for premium transportation will be honored by WIRELESS LINK, and cost of such
premium transportation will be passed on to HIGHWAYMASTER.
8. Freight On Board
Shipping dates shall be established by Wireless on receipt of HIGHWAYMASTER'S
purchase order and shall be communicated by WIRELESS LINK to HIGHWAYMASTER in
writing. All shipments hereunder shall be freight collect, F.O.B. WIRELESS
LINK'S designated shipping point whether in the United State of the Philippines.
All goods shipped are identified and all risks of loss pass to HIGHWAYMASTER
upon delivery to HIGHWAYMASTER, its designated carrier, or any other agent of
HIGHWAYMASTER.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 5
<PAGE> 6
9. Continuous Improvement
HIGHWAYMASTER and WIRELESS LINK will formally review all costs every one hundred
and twenty days (120) as part of the agenda of a Quarterly Review Meeting. It is
critical to the success of both companies that a continuous effort be applied to
reducing costs over the life of the product. As part of this continuous effort
to reduce costs, the following formula will be applicable:
a. Savings from HIGHWAYMASTER generated suggestions will be applied [Text
has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] to
HIGHWAYMASTER.
b. Savings from WIRELESS LINK generated suggestions will be applied [Text
has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] to
HIGHWAYMASTER and [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately
with the SEC.] to WIRELESS LINK.
10. Terms of Payment and Record Keeping
WIRELESS LINK shall issue a single end of week billing to HIGHWAYMASTER for
shipments made during the week. Shipments will be sent out only by authorization
of HIGHWAYMASTER as specified in its weekly shipment releases described in
Section 7 above. Such weekly billing statements shall include a listing of all
shipments made in the week by shipper number. Terms are net [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.] from the date of the invoice.
When payments are made by HIGHWAYMASTER, checks must reference WIRELESS LINK'S
invoice number and indicate the amount paid against that invoice. WIRELESS LINK
shall maintain complete and accurate records of all amounts billed and payments
made by HIGHWAYMASTER hereunder in accordance with generally accepted accounting
practices. These records will be made available to HIGHWAYMASTER upon request.
WIRELESS LINK will retain such records for a period of three (3) years from the
date of final payment for all products covered under this Agreement. WIRELESS
LINK agrees to provide reasonable supporting documentation concerning any
disputed amount on an invoice to HIGHWAYMASTER within thirty (30) days after
HIGHWAYMASTER provides such a request to WIRELESS LINK.
11. Administration of Contract
Both HIGHWAYMASTER and WIRELESS LINK shall assign an individual, hereinafter
referred to as "Contract Administrator", to administer this Agreement throughout
its term. The Director of Materials Operations or designee shall be such
Contract Administrator on behalf of HIGHWAYMASTER and may be contacted at 1155
Kas Drive, Richardson, Texas, 75081. Phone (972) 301-2000. The corresponding
WIRELESS LINK Contract Administrator shall be the Program
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 6
<PAGE> 7
Manager, who may be contacted at 1909 Milmont Drive, Milpitas, California 95035.
Phone (408) 719-1100. All matters related to the performance of this Agreement
shall be administered through those individuals or their designees. Either party
may change the Contract Administrator by notifying the other party of such
change.
All directions, documentation, notifications, forecasts and changes of any kind,
as well as any other activity necessary for the execution of this Agreement,
must be authorized by the HIGHWAYMASTER Contract Administrator prior to
execution by WIRELESS LINK.
12. Limited Warranty
All products manufactured by WIRELESS LINK for HIGHWAYMASTER are warranted for a
period of [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] from
the date of activation or [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed separately with the
SEC.] from the date of manufacture, whichever comes first. WIRELESS LINK
warrants to HIGHWAYMASTER all products manufactured will conform to the Modified
Wireless Product Specifications contained in Attachment A and the Product and
Quality specifications contained in Attachment D hereto and to be free of
defects in workmanship and material. The date of manufacture will be determined
by the date code contained within the serial number of the Module or the date of
first installation listed in HIGHWAYMASTER'S customer database. Warranty claims
will be handled by HIGHWAYMASTER'S Warranty department and will be coordinated
with the WIRELESS LINK repair center by mutual Agreement. WIRELESS LINK'S
liability for claims of warranty is limited to parts and labor to repair, or at
WIRELESS LINK'S option, replacement of any defective component or components.
HIGHWAYMASTER will provide supporting documentation for retrieval costs.
WIRELESS LINK shall not be liable under this warranty if testing and examination
by HIGHWAYMASTER or WIRELESS LINK discloses that the Modified Wireless Product
has been modified or altered in any manner after it was shipped by WIRELESS
LINK. Additionally, WIRELESS LINK shall not be liable under this warranty if
testing and examination by WIRELESS LINK discloses that the alleged defect in
such Modified Wireless Product does not exist or was caused by HIGHWAYMASTER'S
or any third person's misuse, neglect, improper installation or testing,
unauthorized attempts to repair, or any other cause beyond the range of intended
use, or by accident, fire or other hazard.
Due to the nature of HIGHWAYMASTER'S customers, it is necessary to replace a
suspected failure with a known good (refurbished) unit prior to receipt of the
suspect failure. This replacement unit will come from a pool of returned and
repaired units inventoried by HIGHWAYMASTER. In order to keep this pool as small
as possible, WIRELESS LINK agrees that it will repair or replace all units
returned to WIRELESS LINK under warranty within two (2) weeks of receipt by
WIRELESS LINK.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 7
<PAGE> 8
The parties acknowledge that certain costs accrue to HIGHWAYMASTER in response
to customer requests relating to failures under warranty. The parties anticipate
that failures under warranty for any given [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] shall not exceed [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] of the units manufactured in the initial [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.] and thereafter not to exceed
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] of the units
manufactured. In the event failures under warranty in the initial [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.] exceed [Text has been omitted pursuant
to a request for confidential treatment. The omitted material has been filed
separately with the SEC.] of units manufactured in that period or failures
subsequent to the [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] exceed
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] of the units
manufactured in such subsequent period, WIRELESS LINK agrees to replace, at
WIRELESS LINK'S cost, all units in excess of the [Text has been omitted pursuant
to a request for confidential treatment. The omitted material has been filed
separately with the SEC.] during the initial [Text has been omitted pursuant to
a request for confidential treatment. The omitted material has been filed
separately with the SEC.] and in excess of [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] in the period following the initial [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.] with new units or to repair the excess
returned units and credit HIGHWAYMASTER [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.] of HIGHWAYMASTER'S retrieval cost of the returned
unit; provided, however, that the retrieval cost shall not exceed [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.] per Unit without the written agreement
of each party hereto. Units returned for repair more than two times within the
warranty period are to be scrapped at WIRELESS LINK'S expense and WIRELESS LINK
shall provide HIGHWAYMASTER with a new Unit free of charge.
WIRELESS LINK agrees to deliver, freight prepaid, to HIGHWAYMASTER'S customers'
location, any product repaired or replaced pursuant to this warranty.
HIGHWAYMASTER will instruct the user to return, at WIRELESS LINK'S expense, any
such defective products to WIRELESS LINK'S facility. If practical, HIGHWAYMASTER
agrees to notify WIRELESS LINK before such products are returned so that
WIRELESS LINK may elect either to repair such products on location at the users
facility or at its own manufacturing facility. When an In-warranty return is
received at WIRELESS LINK, a credit will be issued to HIGHWAYMASTER. When the
unit is repaired or replaced, a debit will be issued to HIGHWAYMASTER.
WIRELESS LINK shall not be liable under this warranty with respect to any
Modified Wireless Product that is not returned in its original shipping
container
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 8
<PAGE> 9
or a functionally equivalent container or that has not been packaged for return
shipment in the manner described in the instructions, if any, set forth in the
WIRELESS LINK shipping guidelines.
If WIRELESS LINK'S testing and examination does not disclose a defect warranted
under this Agreement, Wireless shall so advise HIGHWAYMASTER in writing and
provide evidence of no warranted defects and dispose of such Modified Wireless
Product in accordance with HIGHWAYMASTER'S instructions and at HIGHWAYMASTER'S
cost. Prior to shipment of any Units back to WIRELESS LINK, HIGHWAYMASTER will
conduct a functional test.
NO WARRANTY IS MADE OR IMPLIED AS TO SUITABILITY FOR ANY PARTICULAR INTENDED
USE. NO WARRANTY IS PROVIDED FOR DAMAGES DUE TO SHIPPING, INSTALLATION,
ENVIRONMENTAL CONDITIONS OUTSIDE OF DESIGN SPECIFICATIONS OR ABUSE BY THE USER
IN WHICH CASE WIRELESS LINK WILL NOTIFY HIGHWAYMASTER OF FREIGHT AND REPAIR
CHARGES IN ADVANCE OF INCURRING REPAIR COSTS. THERE ARE NO OTHER WARRANTIES,
EXPRESSED OR IMPLIED, EXCEPT AS EXPRESSLY STATED HEREIN.
WIRELESS LINK will establish and maintain a repair depot for the repair of units
built by WIRELESS LINK. This operation will remain available for a minimum of
eighteen (18) months beyond the production of the last built model or revision
of that unit. Pricing for repair of products not covered by this warranty
(out-of warranty) will be pre-negotiated at the time such work is required. Any
out of warranty repair work by WIRELESS LINK will be warranted for ninety (90)
days.
Failure data is to be shared between HIGHWAYMASTER and WIRELESS LINK in a timely
manner to insure any corrective action that may be required can be implemented
promptly.
13. Data
HIGHWAYMASTER retains the sole responsibility for all software, firmware,
information or memory data of HIGHWAYMASTER or its customers or end-users
contained in, stored on or integrated with any Modified Wireless Product
returned to Wireless pursuant to any warranty under this Agreement.
14. Miscellaneous Part Purchases
On occasion HIGHWAYMASTER will require WIRELESS LINK to provide component parts
for RMA repair, conversions, or others uses. These transfers of inventory will
be done at the quoted standard cost without margin.
15. Servicing Customers
HIGHWAYMASTER shall be solely responsible for providing service to its customers
and end-
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 9
<PAGE> 10
users in the installation and operation of the Modified Wireless Products and
for answering their service questions. Any service questions from
HIGHWAYMASTER's customers and end-users will be referred by WIRELESS LINK back
to HIGHWAYMASTER.
16. No False Representations
HIGHWAYMASTER shall not knowingly make any false or misleading representations
to its customers, end-users or to other persons regarding the Modified Wireless
Products and shall not make any statements about the specifications, features or
capabilities of the Modified Wireless Products that are inconsistent with those
set forth in this Agreement.
17. Proprietary Information and Confidentiality
For the purpose of this Section 17, "Proprietary Information and
Confidentiality" is defined as all information which either party protects
against unrestricted disclosure to others and which: (i) if in written or other
tangible form, is clearly designated as "confidential," "proprietary," "property
of . . .," "for internal use only," or the like, or (ii) if disclosed orally, is
identified as confidential at the time of its disclosure and is reduced to a
writing designating such information as "confidential" which is delivered to the
receiving party within thirty (30) days following such disclosure. HIGHWAYMASTER
understands and acknowledges that all Wireless Confidential Information and
Industrial Property Rights is Confidential Information that is subject to this
Section 17.
Each party agrees, with respect to any Proprietary and Confidential Information
received by it from the other party: (i) to hold such Proprietary and
Confidential Information in confidence and use it only for the purposes provided
in this Agreement; (a)to use the same methods and degree of care to prevent
disclosure of such Proprietary and Confidential Information as it uses to
prevent disclosure of its own proprietary and confidential information; and (b)
not to disclose any Proprietary and Confidential Information to any third party
(other than directors and officers of the receiving party, and employees of the
receiving party involved directly with the Agreement, all of whom shall be
informed of the confidential nature of the Proprietary and Confidential
Information), without the prior written consent of the disclosing party.
Each party's confidentiality obligations with respect to Proprietary and
Confidential Information received from the other party shall cease if, and to
the extent that, such information: (a) was rightfully in the receiving party's
possession or was rightfully known to the receiving party prior to receipt from
the disclosing party; (b) is independently developed by the receiving party,
without use of Proprietary and Confidential Information of the other party; (c)
is or becomes public knowledge without the fault of the receiving party; (d) is
or becomes rightfully available to the receiving party without confidential
restriction from a source not bound by a confidentiality obligation to the
disclosing party; or (e) is required to be disclosed pursuant to court or
government action provided, however, that the disclosing party is given
reasonable prior notice of such disclosure and the receiving party takes all
reasonable steps to prevent disclosure until the disclosing party has had an
opportunity to appear and object to the action.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 10
<PAGE> 11
The confidentiality obligations and other restrictions imposed under this
Section 17 shall terminate with respect to each item of Proprietary and
Confidential Information three (3) years from the date of its delivery to the
receiving party. Upon termination or expiration of this Agreement, either party
may request the other party in writing to return to it all Proprietary and
Confidential Information that has been provided to it, and all copies made
thereof, and the other party shall promptly return all such information and
copies capable of being returned, except for one copy which may be retained for
archival purposes.
18. Termination for Convenience
HIGHWAYMASTER reserves the right to terminate any purchase order or any part
thereof for the sole convenience of HIGHWAYMASTER. In the event of such
termination, WIRELESS LINK shall immediately stop all work thereunder, and shall
immediately notify any of its suppliers to cease such work unless HIGHWAYMASTER
has stated its intention to assume such supply contracts. WIRELESS LINK shall be
paid for actual units completed prior to receipt by WIRELESS LINK of the
notification of termination (not in excess of the [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.] firm-order limits set forth in Sections 3, 4 and
5 above), plus costs calculated and otherwise limited as set forth in sections
3, 4 and 5 above (the same costs as HIGHWAYMASTER would be liable for in the
event of a scheduling change or cancellation). WIRELESS LINK shall not be paid
for any work done after receipt of notice of termination, nor for any cost
incurred by WIRELESS LINK'S suppliers, which WIRELESS LINK could reasonably have
avoided. HIGHWAYMASTER agrees to accept all inventory as indicated above, which
is not useable by WIRELESS LINK elsewhere, returnable or otherwise disposed of,
and will direct WIRELESS LINK as to the shipping address within thirty (30) days
of settlement. HIGHWAYMASTER may also assume supply contracts or otherwise deal
directly with suppliers as more fully described in Section 5 above.
19. Termination for Cause
Either party may terminate this Agreement for cause in the event of any default
by the other party of any material provision of this Agreement, provided that
the party claiming default shall grant to the breaching party a period of thirty
(30) days (or such longer period as is granted by the non-breaching party in its
sole discretion) to cure such claimed defaults which have been properly noticed
in writing. If such claim has not been cured, the non-breaching party may cancel
any purchase order. However, in the event of a breach by HIGHWAYMASTER that
gives rise to such termination, HIGHWAYMASTER must assume responsibility for all
conforming raw material, finished goods, and work in process according to
Section 5.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 11
<PAGE> 12
20. Force Majeure
HIGHWAYMASTER or WIRELESS LINK may delay delivery or acceptance of products
occasioned by causes beyond their control. WIRELESS LINK shall hold such goods
at the direction of HIGHWAYMASTER and shall deliver them when the cause
affecting the delay has been removed. Causes beyond each party's control shall
include but not be limited to: government action or failure of the government to
act where such action is required, strike or labor trouble, fire, unusually
severe weather, lightning, or similar types of circumstances.
21. Patent Copyright and Trade Secret Indemnity
WIRELESS LINK agrees, at its own expense, to defend HIGHWAYMASTER , from and
against any claim, suit or proceeding, and to pay all judgments and costs
finally awarded against HIGHWAYMASTER or said customer by reason of such claim,
suit or proceeding, insofar as it is based upon an allegation that any Modified
Wireless Product, or part thereof, furnished by WIRELESS LINK infringes any
United States letter patent, if WIRELESS LINK is notified promptly of such
claims in writing and is given authority and full and proper information and
assistance (at WIRELESS LINK'S expense) for the defense of same. In case a
Modified Wireless Product or part thereof, is held in such suit to constitute an
infringement and the use of such product, or any part thereof, is enjoined,
WIRELESS LINK shall, at its sole discretion and at its own expense, either (i)
procure for HIGHWAYMASTER the right to continue using such Product or the
infringing portion thereof, or (ii) replace or modify the same with
non-infringing devices or parts which do not materially degrade the performance,
capability or utility of such Product. In no event will Wireless be liable to
pay to HIGHWAYMASTER in the aggregate more than the total amount that
HIGHWAYMASTER has paid to WIRELESS LINK pursuant to this Agreement.
HIGHWAYMASTER shall have the right to employ separate counsel in any claim, suit
or proceeding and to participate in the defense thereof, but the fees and
expenses of HIGHWAY MASTER's counsel shall not be borne by WIRELESS LINK unless
(i) WIRELESS LINK specifically so agrees, or (ii) WIRELESS LINK after notice and
without cause, does not assume such defense. WIRELESS LINK shall not be liable
to indemnify HIGHWAYMASTER for any settlement effected without WIRELESS LINK'S
consent, unless WIRELESS LINK failed after notice and without cause to defend
such claim, suit or proceeding.
The indemnification set forth herein shall not apply if the infringement arises
from or is based upon WIRELESS LINK'S compliance with the particular
requirements of HIGHWAYMASTER or HIGHWAYMASTER'S customer that differ from
WIRELESS LINK'S standard product specifications; or from modifications or
alterations of the Modified Wireless Product, or part thereof, by HIGHWAYMASTER,
or from a combination of the Modified Wireless Product, or part thereof, with
other items not furnished or manufactured by WIRELESS LINK.
22. Quality Assurance Audits and Product Acceptance
HIGHWAYMASTER reserves the right to audit all processes associated with the
production of the Modified Wireless Product at WIRELESS LINK. WIRELESS LINK
shall manufacture the products
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 12
<PAGE> 13
in substantial conformance with the product quality specifications contained in
the Trailer Tracker Quality Plan (DOC 400-08034 and Attachment D). Any audit or
inspection by HIGHWAYMASTER shall not relieve WIRELESS LINK of the requirement
to effectively control processes and perform its own inspections of the products
manufactured for HIGHWAYMASTER. WIRELESS LINK shall perform, as a minimum, the
following types of Quality inspections in accordance with its own published
manual:
Incoming Material Inspection
In Process Inspection
Final Inspection
ICT Test
Functional Test
WIRELESS LINK shall record the results of inspections and first pass yield data
from all tests and shall provide to HIGHWAYMASTER upon request, reports of
product yields and causes for rejection or test failure. Results shall be
capable of being reported by supplier, by inspection or test point, and by
HIGHWAYMASTER product part number. Where frequency of failure requires
initiation of corrective action, HIGHWAYMASTER shall be informed of the actions
taken and of the subsequent verification of the corrections taken.
WIRELESS LINK understands that particular HIGHWAYMASTER customer requirements
may modify existing Quality programs. HIGHWAYMASTER understands that depending
on the scope of such modification, pricing may have to be adjusted for increased
or decreased cost. HIGHWAYMASTER shall (at HIGHWAYMASTER discretion) perform
incoming inspection and/or test upon receipt of products shipped by WIRELESS
LINK. Inspection, testing, auditing or the failure to do any of the foregoing
shall not affect HIGHWAYMASTER'S right to reject any product or revoke its
acceptance under any provision of this Agreement. Furthermore, payment for
products delivered hereunder shall not constitute acceptance thereof.
HIGHWAYMASTER shall have the right to inspect and test such products at any time
or stage within sixty days (60) of the date of manufacture and to reject any or
all said products that are defective or non-conforming.
23. Taxes
Unless HIGHWAYMASTER first provides WIRELESS LINK with an appropriate and valid
exemption certificate there shall be added to the price of all goods shipped
hereunder the amount of any sales or use tax applicable to the sale or license
of such goods to HIGHWAYMASTER, but under no circumstances shall there be added
to such price the amount of any general business tax, personal property tax, or
any tax levied upon WIRELESS LINK that is based on or measured by the gross
receipts, net income or share or asset value of WIRELESS LINK.
24. Additional Actions
Each party hereto agrees to (or cause others to take) such other action and to
execute and deliver (or
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 13
<PAGE> 14
cause others to execute and deliver) such agreements, certificates or documents
as may be reasonably necessary or desirable to carry out the provisions of this
Agreement.
25. Notice
Any notice required or permitted under this Agreement, unless otherwise
expressly permitted hereunder, shall be in writing and shall be deemed to have
been fully given and/or delivered (i) when personally delivered, (ii) when sent
by telefax, (iii) one business day after the business day of deposit pre-paid
with a national overnight carrier, or (iv) five business days after the business
day of deposit pre-paid with the United States Mail.
Notices must be addressed to:
HIGHWAYMASTER CORPORATION
1155 Kas Drive
Richardson, Texas 75081
Attn: General Counsel
WIRELESS LINK CORPORATION.
1909 Milmont Drive
Milpitas, California 95035
Attn: Program Manager
26. Relationship of the Parties
The relationship of WIRELESS LINK and HIGHWAYMASTER established by this
Agreement is that of independent contractors, and nothing contained in this
Agreement shall be construed to (i) give either party the power to direct and
control the day-to-day activities of the other or (ii) constitute the parties as
partners, joint venturers, co-owners or otherwise as participants in a joint or
common undertaking. WIRELESS LINK, its agents and employees are not the
representatives of HIGHWAYMASTER for any purpose except as expressly set forth
in this Agreement, and they have no power or authority as agent, employee or in
any other capacity to represent, act for, bind, or otherwise create or assume
any obligation on behalf of HIGHWAYMASTER for any purpose whatsoever. All
financial obligations associated with WIRELESS LINK's business are the sole
responsibility of WIRELESS LINK. HIGHWAYMASTER, its agents and employees are not
the representatives of WIRELESS LINK for any purpose except as expressly set
forth in this Agreement, and they have no power or authority as agent, employee
or in any other capacity to represent, act for, bind, or otherwise create or
assume any obligation on behalf of WIRELESS LINK for any purpose whatsoever. All
financial obligations associated with HIGHWAYMASTER's business are the sole
responsibility of HIGHWAYMASTER. All sales and other agreements between
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 14
<PAGE> 15
HIGHWAYMASTER and its customers are HIGHWAYMASTER's exclusive responsibility and
shall have no effect on HIGHWAYMASTER's obligations under this Agreement.
HIGHWAYMASTER shall be solely responsible for, and shall indemnify and hold
WIRELESS LINK free and harmless from, any and all claims, damages, or lawsuits
arising out of the acts or omissions of HIGHWAYMASTER, its employees, servants,
agents, independent contractors or any of them.
27. Export
HIGHWAYMASTER shall comply with all applicable provisions of the United States
Export Administration regulations with respect to the export of goods and shall
provide WIRELESS LINK with all documentation and data necessary or desirable in
monitoring such compliance. HIGHWAYMASTER agrees to hold WIRELESS LINK harmless
from and indemnify WIRELESS LINK against any liability arising from the failure
of HIGHWAYMASTER or HIGHWAYMASTER's customers to comply with such regulations.
This provision shall survive any termination, transfer, or expiration of this
Agreement.
28. Government Contracts
If any of the goods to be furnished pursuant to this Agreement are to be used in
the performance of a U.S. Government contract or subcontract then a U.S.
Government contract number shall appear on all purchase orders and applicable
U.S. Government procurement regulations shall be incorporated herein by
reference. HIGHWAYMASTER agrees to hold WIRELESS LINK harmless from any loss and
to indemnify WIRELESS LINK against any claim resulting from a violation of such
regulations where HIGHWAYMASTER has failed to notify WIRELESS LINK of their
applicability.
29. Assignment
This Agreement is personal to the parties hereto and any delegation by either
party of its duties of performance under this Agreement or any assignment by
either party hereto of its rights hereunder is prohibited and shall, at the
option of the other party, void this Agreement, provided that WIRELESS LINK may
assign its rights to receive payments hereunder.
30. Waivers
No waiver of any provision of this Agreement shall be effective unless made in
writing. No waiver of any breach of any provision of this Agreement shall
constitute a waiver of any subsequent breach of the same or of any other
provision of this Agreement.
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 15
<PAGE> 16
31. Severability
Any provision of this Agreement which is invalid, prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity, prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such invalidity, prohibition or
unenforceability in any such jurisdiction shall not invalidate or render
unenforceable such provisions in any other jurisdiction.
32. Titles and Schedules
Titles or captions of sections contained in this Agreement have been inserted
only as a matter of convenience and in no way define, limit, extend, describe or
otherwise affect the scope of meaning of this Agreement or the intent of any
provisions hereof. All exhibits, schedules, appendices and agendas referred to
in this Agreement are incorporated herein by reference as though fully set forth
herein.
33. Governing Law
The rights and obligations of the parties to this Agreement shall be governed by
and construed in accordance with the laws of the State of California, without
regard to the principles of conflicts of laws.
34. Interpretation
The plural shall include the singular, and the singular shall include the
plural, whenever used.
35. Limitation on HIGHWAYMASTER and WIRELESS LINK Liability
In no event shall HIGHWAYMASTER or WIRELESS LINK be liable for anticipated
profits or for special, incidental or consequential damages.
36. Confidentiality of Agreement
Each party to this Agreement agrees to maintain the terms of this Agreement
confidential and refrain from disclosing the same to third parties without the
prior written consent of the other party hereto.
37. Entire Agreement
This Agreement, including any Exhibits, schedules and tables attached hereto
which either have been specifically referred to herein, constitutes the entire
agreement between the parties with respect to the subject matter hereof. This
Agreement supersedes all prior discussions, understandings and agreements with
respect to such subject matter.
IN WITNESS WHEREOF: with the intent to be legally bound, HIGHWAYMASTER has
caused
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 16
<PAGE> 17
this Agreement to be signed by its authorized representative, and WIRELESS LINK
with the same intent has caused this Agreement to be signed by its duly
authorized representative on its own behalf.
HIGHWAYMASTER CORPORATION WIRELESS LINK CORPORATION
By: (x) Jana Bell By: (x) Hamid Najafi
-------------------------- -----------------------------
Title: President & CEO Title: President & CEO
--------------------- -----------------------
Date: March 9, 1999 Date: February 16, 1999
---------------------- -------------------------
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 17
<PAGE> 18
ATTACHMENT A
MODIFIED WIRELESS PRODUCT SPECIFICATION
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
RESTRICTED PROPRIETARY INFORMATION
The information contained herein is for the use of authorized employees of the
parties and their affiliates hereto only and is not for general distribution
within or distribution outside their respective companies
except by written agreement.
Page - 18
<PAGE> 19
ATTACHMENT B
PRODUCT PART NUMBER AND PRICE
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
Proprietary and Confidential
Page - 19
<PAGE> 20
ATTACHMENT C
KANBAN QUANTITIES PLAN
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
Proprietary and Confidential
Page - 20
<PAGE> 21
ATTACHMENT D
TRAILER TRACKER QUALITY PLAN (DOC 400-08034
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
Proprietary and Confidential 21
<PAGE> 1
EXHIBIT 10.40
AGREEMENT
This Agreement is entered into as of the 19th day of January, 1999,
between Cellemetry LLC, ("Cellemetry") and HighwayMaster Corporation ("Company")
on the following terms and conditions:
OVERVIEW. Cellemetry and Company desire to enter into an agreement under which
Company will market in the United States Applications Powered Heavy Construction
Equipment tracking, location, status notification (requiring forward and reverse
channel traffic), event notification (requiring only reverse channel traffic),
and data communications (the "Services") using Cellemetry's proprietary access
technology using features of a cellular network (the "Cellemetry(R) Data
Service"). Each party will provide certain products and services as set forth
herein and in accordance with the terms of this Agreement. Both parties agree to
use their best efforts to maximize the commercial use of Cellemetry(R) Data
Service with respect to the provision of Services. Each party agrees that it
will not knowingly perform or fail to perform its responsibilities under this
Agreement in such a manner as to cause harm to Cellemetry(R) Data Service.
DEFINITIONS. As used in this Agreement, the following words shall have the
definitions set forth in this Paragraph:
"Application" - Computer software and associated hardware that operates
with Cellemetry(R) Data Service to provide monitoring and
other telemetry services to customers.
"Cellemetry(R) Data Service" - [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has
been filed separately with the SEC.]
"Cellular Service Area" - A Metropolitan Statistical Area ("MSA") or a
Rural Service Area ("RSA") within which a cellular carrier
("Carrier") is licensed by the Federal Communications
Commission to provide cellular service, provided, however,
that if a Carrier has combined multiple MSAs and/or RSAs under
a single System ID ("SID"), the area encompassed under the
single SID shall be the Cellular Service Area.
"Gateway" - [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed
separately with the SEC.]
"Message" - A one-way broadcast over the cellular network using
Cellemetry(R) Data Service.
<PAGE> 2
"United States" or "U.S." - The forty-nine continental United States,
the District of Columbia, and Hawaii.
TERM OF AGREEMENT. This Agreement shall become effective upon its execution by
both parties and shall continue in effect for ten (10) years unless sooner
terminated as provided herein.
LICENSING PROVISIONS. During the initial and any renewal terms: (i) Cellemetry
grants Company a non-transferable, non-exclusive license to market the
Cellemetry(R) Data Service in conjunction with Applications and Services. This
license shall be limited to the Specified Market and Geographic Scope
(Territory) designated below. In the event that Company wishes to provide
Services using Cellemetry(R) Data Service in any other market or territory, it
must request from Cellemetry a separate license covering such new areas.
Cellemetry shall retain the right to consider such request in its own
discretion.
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
MARKET DEFINITION. [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
GEOGRAPHIC SCOPE. The rights granted hereunder shall apply to all Cellular
Service Areas in the United States for which Cellemetry has entered or may enter
into agreements with cellular carriers to provide Cellemetry(R) Data Service.
The parties anticipate that the number of Cellular Service Areas will expand,
and Company shall not pay any additional amounts hereunder due to such
expansion. Should Company wish to provide the Services using Cellemetry(R) Data
Service in other Cellular Service Areas or in other countries, it may request
that Cellemetry enter into a separate agreement. Cellemetry may, but shall not
be obligated to, negotiate and enter into such an agreement. [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.]
COMPANY'S OBLIGATIONS. Company shall provide to Cellemetry by March 1, 1999, a
detailed three (3) year business plan, updated annually for a rolling three (3)
year forecast, which shall outline (i) the Company's distribution plans,
including channels of distribution and deployment schedule; (ii) a marketing
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<PAGE> 3
communications plan, including attending trade shows, advertising etc.; (iii)
sales support, including sales tools, sales training; etc.; and (iv) an industry
forecast with assumptions; and (v) written confirmation of company financial
viability.
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
Company agrees that it will only use radios manufactured by companies
approved by Cellemetry in connection with its provision of the Services.
Cellemetry does not presently manufacture radios, but nothing in this Agreement
shall preclude Cellemetry from manufacturing radios or from accepting a royalty
rate [Text has been omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the SEC.]
During the initial and any renewal terms, Company shall provide ongoing
support for the Applications used to provide the Services and for all related
hardware and software, including but not limited to the interface, long distance
transport circuits, local circuits, and clearinghouse hardware and software.
Company shall provide support to its customers and shall be the intermediary
between its customers and the Cellemetry(R) Data Service Gateway.
If the Company fails to achieve the items listed in this section
entitled Company's Obligation, fails to achieve development dates in the section
entitled Licensing Provisions, or fails use its best efforts as set forth in the
Overview Section, Cellemetry may cancel this agreement as its sole and exclusive
remedy for such failures of Company after 30 days written notice to Company with
opportunity to use during such notice period.
CELLEMETRY OBLIGATIONS. Cellemetry shall, at its own expense, arrange for the
development and provide the Cellemetry(R) Data Service Gateways and arrange for
the commercial availability of the radios necessary to provide Cellemetry(R)
Data Service.
Cellemetry shall provide or make available ongoing support for
operational Gateways. Cellemetry shall notify Company of any material changes to
the Gateways within a reasonable time (at least sixty days) after they have been
made and tested. In the event that Cellemetry must make changes that are not
"backward compatible," Cellemetry shall provide at least one hundred eighty
(180) days' prior written notice to Company, and will provide Company a
reasonable time to discuss the proposed change with Cellemetry and propose
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<PAGE> 4
alternatives, which Cellemetry shall reasonably consider. Company shall be
entitled to access to Cellemetry support for Cellemetry(R) Data Service, which
shall be provided without additional charge upon execution of this Agreement.
Cellemetry shall provide telephone problem resolution support on a
twenty-four (24) hours a day seven (7) days a week basis. At a minimum, response
times for calls received during normal business hours (8:30 a.m. - 5:30 p.m. in
the time zone of the party receiving the call Monday through Friday, holidays
excepted) is thirty (30) minutes from receipt of the call. During all other
hours calls will be returned within one (1) hour and thirty (30) minutes of
receipt of the call. Only calls relating to Network Service Affecting problems
will be returned during non-business hours. Non-Service Affecting problems
received during non-business hours will be returned the next day. Both the
Company and Cellemetry shall provide and maintain a current and up to date
twenty-four (24) hours a day seven (7) days a week Trouble Escalation Contact
List with the appropriate telephone, cellular, and/or paging numbers of the
organization and/or personnel responsible for assisting in trouble resolution
both during and after normal business hours, and a list of the holidays observed
by each party.
Cellemetry shall maintain a Gateway for testing purposes in the United
States. Cellemetry shall have the right to make changes or alterations or to
have changes or alterations made to the test Gateway or to any
commercially-deployed Gateways, including both software and hardware at any time
and from time to time during the term of this Agreement. Cellemetry shall notify
Company at least twenty-four (24) hours prior to any scheduled hardware or
software changes being performed on its commercial Gateway(s), and within
twenty-four (24) hours after any non-scheduled hardware or software changes have
been performed on its commercial Gateway(s). Cellemetry shall provide testing
facilities to Company to allow it to review material changes prior to the
release of those changes for commercial use. Cellemetry shall use its best
efforts to ensure that the changes are backward compatible. During the term of
this Agreement, the parties shall review operational issues at least every
twelve (12) months to discuss minor Gateway and other modifications that need to
be made to the equipment or services contemplated by this Agreement.
EXISTING CELLEMETRY COVERAGE. At the time of execution of this Agreement
Cellemetry represents and warrants that it has reliable, fully operational
Cellemetry coverage in service throughout substantially all of the geographic
coverage areas represented on the coverage map attached to this Agreement as
Appendix 1.
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<PAGE> 5
SERVICE LEVEL AGREEMENT. Cellemetry and the Company agree to negotiate in good
faith to attach a Service Level Agreement as a binding amendment to this
Agreement within 90 days after execution of this Agreement, with the purpose of
establishing certain minimum standards of service with which the Cellemetry(R)
Data Service must comply. The Service Level Agreement will address downtime
standards, partial coverage downtime standards, partial coverage downtime
standards, system operability, system response time, compliance with
specifications, and other technical and service standards which Cellemetry will
warrant to customer. The Service Level Agreement will contain penalties for
failure to meet Service Level Commitments, such as refunds of amounts paid for
affected airtime services, pricing reductions, assistance with fleet-wide
retrofits which result from failures, rights of cancellation, or similar
penalties. In the event the parties do not execute a Service Level Agreement
amendment to this Agreement which is satisfactory to HighwayMaster within 90
days after execution of this Agreement, Customer will have option of canceling
this Agreement without liability to Cellemetry.
DEFAULTS. Either party shall be deemed to have committed an event of default
hereunder if such party:
(a) is in default of any of its material obligations hereunder and fails to cure
such default within thirty (30) days after written notice from the first party
specifying the default and the specific actions necessary to cure same; or
(b) is grossly negligent, engages in criminal activity or fraud with respect to
the first party, any customer, or any regulatory agency; or
(c) institutes or has instituted against it, insolvency, receivership, or
bankruptcy proceedings, if such proceedings are not dismissed or stayed within
sixty (60) days after having been filed; or
(d) makes an assignment for the benefit of creditors; or
(e) dissolves or ceases to do business; or
(f) commits an event of default under or otherwise breaches the terms of any
other agreement between the parties hereto.
Upon the occurrence of an event of default by a party hereto, the other
party shall be entitled to terminate this Agreement and exercise any other
rights and remedies available to it under this Agreement, or under applicable
law or in equity arising therefrom. All remedies hereunder shall be cumulative.
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<PAGE> 6
PAYMENTS. In consideration of the rights granted under this Agreement, Company
agrees to pay Cellemetry the amounts set forth in Appendix 2. The amounts due
and payable hereunder shall be reported to Cellemetry by Company on a monthly
basis within ten (10) business days after the end of the month, and the amounts
due shall be payable to Cellemetry within fifteen (15) days after the close of
each calendar quarter until July 1, 2000, and within fifteen (15) days after the
end of each month thereafter. Each report shall contain an explanation of the
amount of the payment and the method by which it was calculated. All payments
shall be in U.S. dollars.
Cellemetry shall have the right, not more than once in a twelve (12)
month period, through a major independent auditing firm, to audit the records
underlying the payments made under this Agreement to determine their accuracy.
Any information derived from the reports or records shall be maintained in
confidence by the auditor and Cellemetry. Company shall maintain all such
reports and records for a minimum of three (3) years after the date of the
termination or expiration of this Agreement. Should Cellemetry determine through
such an audit that Company has underpaid the amounts due under this Agreement by
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] then Company shall, in
addition to paying the difference between the amount due and the amount paid and
interest thereon at two percentage points above the prime rate published by the
Wall Street Journal on the date payment was due until the date paid, reimburse
Cellemetry for the expenses Cellemetry incurred in performing the audit.
If any payment due under the terms of this Agreement is not paid when
due, then Company shall pay Cellemetry, in addition to the overdue amount,
interest on such overdue amount from the date it was due until it was paid at a
rate which is two percentage points above the prime rate published by the Wall
Street Journal on the date payment was due, or the maximum rate permitted by
law, whichever is less. Payment of such interest shall be in addition to any
other remedies that Cellemetry may have for Company's failure to make timely
payments.
Company shall be solely responsible for payment of any taxes (including
sales or use taxes and intangible taxes) resulting from Company's operation of
its business under this Agreement, excluding any income taxes payable by
Cellemetry on fees received from Company. Company agrees to hold Cellemetry
harmless from all claims and liability arising from Company's failure to report
or pay such taxes, provided Cellemetry has reported or collected sales, use and
intangible taxes as required by law.
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<PAGE> 7
MARKET RESEARCH. Cellemetry shall have the right, not more often than once per
calendar year, to perform market research projects with respect to Company's
existing customer base or within the industry. Cellemetry shall be responsible
for the costs of performing the market research projects, and Company agrees
that, if Cellemetry so requests, it will assist in the development of the market
definition, sampling, and questionnaire design. Cellemetry acknowledges that the
identity and characteristics of Company" customers are a trade secret of
Company, and Cellemetry will not disclose or commercially exploit such
information without the express written consent of Company.
BRAND IDENTIFICATION AND PUBLICITY. In Cellemetry's sole discretion, and subject
to the terms of the Trademark License Agreement attached hereto as Appendix 3,
the logo for Cellemetry(R) Data Service will appear in all Cellemetry(R) Data
Service-related print and sales support materials. In accordance with and as
permitted by the terms of the Trademark License Agreement, the Cellemetry name
may be omitted from the logo for Cellemetry(R) Data Service. Company agrees to
submit to Cellemetry all representative copies of, advertising, sales promotion,
press releases and other publicity matters relating to the purposes of this
Agreement wherein Cellemetry's name, marks, or logo, or the name or mark of any
Cellemetry Company is mentioned or language from which the connection of said
names, marks, or logo therewith may be inferred or implied. Cellemetry shall not
be entitled to reimbursement by Company for any approved use of the logo.
Company agrees not to publish or use such advertising, sales promotion, press
releases, or publicity matters without Cellemetry's prior written approval.
INTELLECTUAL PROPERTY. As used herein, "Intellectual Property Rights" means all
forms of intellectual property rights and protections that may be obtained for,
or may pertain to, Cellemetry(R) Data Service and may include, without
limitation, all right, title, and interest in (i) all U.S. and foreign letters
patent and all filed, pending, or potential applications for such letters
patent; (ii) all trade secret rights and equivalent rights arising under common
law, state law, Federal law, and laws of foreign countries; (iii) all mask
works, copyrights, and other literary property or authors' rights, whether or
not protected by copyright or under common law, state law, Federal law, and laws
of foreign countries; and (iv) all proprietary indicia, trademarks, trade names,
symbols, logos, and/or brand names under common law, state law, Federal law, and
laws of foreign countries.
Company hereby recognizes that, except as expressly set forth in this
Agreement, Cellemetry retains all Intellectual Property Rights which may be
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<PAGE> 8
owned by Cellemetry in Cellemetry(R) Data Service and any Information (as
defined in the Paragraph entitled "Nondisclosure") owned by Cellemetry that is
disclosed to Company under this Agreement, including any fixes, improvements, or
other derivatives thereof to the extent created by Cellemetry and not by the
Company.
Cellemetry hereby recognizes that Company retains all Intellectual
Property Rights in its system for monitoring distribution usage as described
above (by using, for example, cellular voice channel radio technology) and in
any Information (as defined in the Paragraph entitled "Nondisclosure") owned by
Company that is disclosed to Cellemetry under this Agreement, including any
fixes, improvements, or other derivatives thereof.
NOTICE. Notice or other advice required to be given hereunder shall be deemed
given when deposited, postage prepaid, in the United States Mail addressed as
follows:
Cellemetry: Cellemetry LLC
Suite 200
1600 Parkwood Circle
Atlanta, GA 30339-3769
Company: HighwayMaster Corporation
Director of Trailer Tracking
1155 East Kas Drive
Richardson, TX 75081
With a copy to: General Counsel
If either party changes its address during the term hereof, it shall so advise
the other party in writing and any notice thereafter required to be given shall
be sent by certified mail to such new address.
NONDISCLOSURE. The parties agree to comply with the terms of the Non-disclosure
Agreement that is attached hereto as Appendix 4, which shall supersede any prior
non-disclosure agreement between the parties; provided, however, notwithstanding
anything to the contrary in the Non-disclosure Agreement, that the
Non-disclosure Agreement shall have the same term as this Agreement and that any
obligations that by the terms of the Non-disclosure Agreement will continue
after the termination or expiration of the Non-disclosure Agreement shall
likewise continue after the termination or expiration of this Agreement.
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PLANT RULES AND SECURITY REQUIREMENTS. The employees and agents of each party
shall, while on the premises of the other, comply with all plant rules and
regulations in effect at such premises, including security requirements.
LIABILITIES. Cellemetry shall have no liability to Company for any delay in
performance or for non-performance of the Services arising from any manufacturer
or supplier of any of the equipment, including any peripheral equipment,
necessary to the provision by Company of the Services.
LIMITATION OF LIABILITY. (a) EACH PARTY UNDERSTANDS THAT OCCASIONAL INTERRUPTION
OR IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE MAY OCCUR DUE TO DEFECTS IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE OR FROM PROBLEMS IN THE
PROVISION OF CELLULAR SERVICE; THAT ANY POTENTIAL HARM FROM INTERRUPTIONS OR
IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE OR IN THE PROVISION OF CELLULAR
SERVICE IS SPECULATIVE IN NATURE; AND THAT NEITHER PARTY ASSUMES ANY
RESPONSIBILITY OTHER THAN THAT CONTAINED IN THIS AGREEMENT. ACCORDINGLY, EACH
PARTY AGREES THAT EXCEPT AS LIMITED BY LAW, THE TOTAL CUMULATIVE LIABILITY OF
THE OTHER PARTY FOR LOSSES OR DAMAGES ARISING OUT OF MISTAKES, OMISSIONS,
INTERRUPTIONS, DELAYS, ERRORS, OR DEFECTS IN THE CELLEMETRY(R) DATA SERVICE
HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR IN THE PROVISION OF CELLULAR
SERVICE, OR FOR LOSSES OR DAMAGES ARISING OUT OF THE FAILURE OF EITHER PARTY TO
MAINTAIN PROPER STANDARDS OF MAINTENANCE AND OPERATION SHALL BE LIMITED SOLELY
TO THE ALLOWANCE OF A CREDIT TO THE COMPANY IN THE AMOUNT OF THE CHARGES BILLED
BY CELLEMETRY TO COMPANY FOR THE AFFECTED TRAILERS DURING THE PERIOD IN WHICH
THE SERVICE PROBLEM OCCURRED. THE CELLULAR CARRIER'S CUMULATIVE LIABILITY SHALL
IN NO EVENT EXCEED ONE THOUSAND DOLLARS ($1000.00). NEITHER PARTY SHALL HAVE ANY
LIABILITY FOR ANY MISTAKE, OMISSION, INTERRUPTION, DELAY, ERROR, OR DEFECT IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR
IN THE PROVISION OF CELLULAR SERVICE THAT DOES NOT LAST FOR AT LEAST TWENTY FOUR
(24) HOURS.
(b) NEITHER PARTY SHALL IN ANY EVENT BE LIABLE FOR SERVICE OR EQUIPMENT
INTERRUPTIONS, DELAYS IN TRANSMISSION, OR ERRORS OR DEFECTS IN SERVICE OR
EQUIPMENT WHEN CAUSED BY ACTS OF GOD, FIRE, WAR, RIOTS, GOVERNMENT AUTHORITIES,
DEFAULT OF SUPPLIER, OR OTHER CAUSES BEYOND THE CONTROL OF THAT PARTY. [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.]
(d) THE LIABILITY OF EACH PARTY IN CONNECTION WITH THE PROVISION OF
CELLEMETRY(R) DATA SERVICE PROVIDED IS SUBJECT TO
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THE FOREGOING LIMITATIONS AND NEITHER PARTY MAKES ANY WARRANTIES OF ANY KIND,
OTHER THAN STATED IN THIS AGREEMENT, EXPRESSED OR IMPLIED, INCLUDING THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AS TO THE
PROVISION OF SUCH SERVICE.
LIABILITY INSURANCE. Both Cellemetry and Company, at their own expense, shall
take out and at all times during the term of this Agreement maintain commercial
general liability insurance, including products and completed operations and
contractual liability coverage, as will protect each party from claims for
bodily injury and property damage, including death, which may arise in or result
from either party's operations in carrying out the purposes of this Agreement.
Said commercial general liability coverage shall be written on an occurrence
basis with limits of not less than $1,000,000 per occurrence/aggregate. Each
party shall named the other party as an additional insured with respect to the
insurance provided under this Agreement. In addition, both parties shall
maintain statutory workers compensation and employers liability insurance in the
amount of not less than $300,000. If the use of vehicles by either party is
necessary for the execution of this Agreement, then that party shall maintain
vehicle liability insurance with a combined single limit of not less than
$1,000,000.
Certificates of such insurance shall be submitted to the other party
prior to the Application being in commercial service and at any time upon either
party's request. Certificates of insurance shall be sent to:
Cellemetry LLC HighwayMaster Corporation
Suite 200 1155 Kas Drive
1600 Parkwood Circle Richardson, TX 75081
Atlanta, GA 30339-3769
No insurance required to be maintained pursuant to this Agreement shall
be canceled without giving at least ten (10) days prior written notification to
the other party.
INDEMNIFICATION. Both parties agrees to indemnify and save harmless the other
party from any liabilities, lawsuits, penalties, claims, or demands (including
the costs, expenses, and reasonable attorneys fees on account thereof) that may
be made: (1) by any third party for injuries, including death, to persons or
damage to property, including theft, resulting from either Company's or
Cellemetry's negligent or willful acts or omissions or those of persons
furnished by Company or Cellemetry, its agents or subcontractors; or (2) by any
employee or former
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employee of either party or any of its subcontractors for which Company's or
Cellemetry's or subcontractor's liability to such employee or former employee
would otherwise be subject to payments under the state Worker's Compensation or
similar laws. Both parties agree to defend the other party, at that party's
request, against any such liability, claim, or demand. Both parties agree to
notify the other party promptly of any written claims or demands against that
party for which Company or Cellemetry is responsible hereunder.
RELATIONSHIP. Neither Company nor its subcontractors, nor the employees or
agents of any of them, shall be deemed to be Cellemetry's employees or agents,
it being understood that Company and its subcontractors are independent
contractors for all purposes and at all times, and Company and its
subcontractors shall be wholly responsible for withholding or payment of all
Federal, State, and local income and other payroll taxes with respect to their
employees, including contributions from them as required by law.
ARBITRATION. Any disputes arising hereunder with respect to the fulfillment or
interpretation of any terms or conditions hereof shall be settled by an amicable
effort by the parties.
Either party may request that any such dispute which is not amicably
settled by such efforts of the parties shall be submitted to voluntary binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), as modified herein.
Either party may initiate arbitration by filing a demand at the
regional office of the AAA closest to Cellemetry's offices. Disputes will be
heard and determined by a panel of three arbitrators. Each party will appoint
one arbitrator to serve on the panel, and the AAA will appoint one neutral
arbitrator. Neither party will communicate separately with any arbitrator. All
communications between a party and an arbitrator will be directed to the AAA for
transmittal to the arbitrator.
Either party may petition the court in the state in which the
arbitration was held to confirm, correct, or vacate the award on the grounds
stated in the Federal Arbitration Act. Nothing in this paragraph will prevent
either party from seeking injunctive relief against the other party (and its
employees or agents) from any judicial or administrative authority pending the
resolution of a dispute or controversy by arbitration. The arbitrators shall
also decide on the liability for costs including the reimbursement of reasonable
attorneys' fees.
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CHOICE OF LAW. This Agreement shall be construed in accordance with the law of
the State of Georgia without regard to its choice of law provisions.
SEVERABILITY. In the event that any one or more of the provisions contained
herein shall for any reason be held to be unenforceable in any respect under the
laws of the jurisdiction governing the entire Agreement, the Agreement shall
then be construed as if such unenforceable provision or provisions had never
been contained herein.
RELEASES VOID. Neither party shall require waivers or releases of any personal
rights from representatives or customers of the other in connection with visits
to its premises and both parties agree that no such releases or waivers shall be
pleaded by them or by third persons in any action or proceeding.
GIFTS AND GRATUITIES. The exchange or offering of any gift item, personal
service, unusual entertainment or hospitality by either party of this Agreement
to the other party is expressly prohibited. This prohibition is equally
applicable to either party's officers, employees, agents or immediate family
members. Any violation of this tenet constitutes cause for immediate
cancellation of this Agreement.
FORCE MAJEURE. Neither party shall be liable to the other for failure or
inability to perform its obligations hereunder to the extent that such failure
or inability is due to force majeure. For the purposes of this Agreement, "force
majeure" shall mean causes beyond the reasonable control of the party, including
but not limited to acts of God, acts of the public enemy, fires, floods, acts of
any government, strikes, embargoes, unusually severe weather conditions, or
inability to obtain necessary raw materials. In the event of any such situation,
the party shall be given a reasonable period of time in which to complete its
obligations, during which the other party's payment obligations shall be
suspended. Should the condition continue for a period of six (6) months, then
the other party shall have the right to terminate this Agreement without
liability to the other party except as to rights accrued as of the date of
termination.
ASSIGNMENT. Except upon change of control of either party, neither party may
assign this Agreement without the prior written consent of the other party,
which consent shall not be unreasonably withheld.
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SECTION HEADINGS. The headings of the several Sections are inserted for
convenience of reference only and are not intended to be a part of, or to affect
the meaning or interpretation of, this Agreement.
ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
Cellemetry and Company with respect to the subject matter hereof and shall not
be amended or modified without specific written provision to that effect, signed
by both parties. No oral statement of any person whomsoever shall, in any manner
or degree, modify or otherwise affect the terms and provisions of this
Agreement.
Cellemetry LLC HighwayMaster Corporation
By: (x) John K. Collings By: (x) Jana Bell
-------------------- -------------
Title: EVP Cellemetry LLC Title: President
------------------ ---------
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APPENDIX 1
TOTAL CELLEMETRY COVERAGE AREA
[MAP]
<PAGE> 15
Appendix 2
Payment
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
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Appendix 3
TRADEMARK LICENSE AGREEMENT
This Agreement is made by and between Cellemetry LLC ("Licensor"), and
Company ("Licensee").
WHEREAS, the "CELLEMETRY" mark and logo are registered trademarks of
Cellemetry Corporation ("Cellemetry"); and
WHEREAS, Licensee desires to use the "CELLEMETRY" mark in word and
logotype form (the "Mark") in connection with its provision of applications,
which consist of software programs that provide telemetry features, such as
remote meter reading, alarm monitoring, and similar functions, ("Applications")
and associated equipment, which consists of radios and devices connecting the
radios to monitoring, alarm, or similar equipment at a cellular customer's
location, ("Equipment") to facilitate the use by the cellular customer ("End
User") of Cellemetry telemetry messaging services provided by a cellular carrier
which licenses the CELLEMETRY mark and related technology from Licensor (a
"Carrier") in accordance with the terms of the agreement to which this Agreement
is attached;
WHEREAS, Cellemetry will obtain a benefit in consideration of the
advertising from Licensee's marketing using the "CELLEMETRY" mark to designate
the service with which the Applications and the Equipment are compatible; and
WHEREAS, Cellemetry has authorized Licensor to sublicense the Mark to
Licensee pursuant to the terms hereof;
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, the parties hereby agree as follows:
I. PURPOSE
Licensee proposes to engage in the business of developing and providing
certain Applications and Equipment for use by End Users to enable Carriers to
provide telemetry messaging services to such End Users using Cellemetry(R) Data
Service within the geographic territory comprising the Cellular Service Area(s)
of
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the applicable Carrier (the "Territory"). Licensee desires to use the Mark in
connection with the provision of Applications and Equipment to End Users (the
"Business") in the Territory to denote compatibility of the Applications and
Equipment with Cellemetry(R) Data Service. Licensor is willing to permit
Licensee to use the Mark in connection therewith on the terms and conditions set
forth herein.
II. LICENSE
Licensor grants to Licensee, upon the terms and conditions of this
Agreement, the non-exclusive right, license, and privilege to use the Mark only
in the Territory and only to promote the Applications in marketing material,
advertising, and publicity and on the Equipment that it provides in connection
therewith to denote the compatibility of the Equipment with Cellemetry(R) Data
Service. No license is granted herein with respect to the use of the Mark as a
trademark on the Applications or the Equipment or with respect to any other mark
owned or used by Licensor or Cellemetry, including, but not limited to,
CELLEMETRY or the Bell Symbol logo.
III. TERM
Except as otherwise provided in this Agreement, the term of this
Agreement is co-extensive with the agreement to which it is attached, and it
shall expire or terminate on the same date as that agreement.
IV. DUTIES OF LICENSOR
All duties of Licensor under this Agreement are to Licensee, and no
other party except Cellemetry, the owner of the Marks, is entitled to rely on,
enforce, or obtain relief for breach of any such obligation, either directly or
by subrogation. Licensor shall undertake the following duties:
A. Trademark Usage Guidelines
Licensor will provide Licensee with written and graphic
guidelines for the correct reproduction, application, and presentation of the
Mark, which may include Mark specimens, samples of advertisements, and clip art
indicating color, proportion, and format.
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V. DUTIES OF LICENSEE
Licensee understands and acknowledges that the proper usage of the Mark
and the use of the Mark in association with a high quality of goods and service
is important to Licensee, Licensor, Cellemetry, and other licensees of the Mark
in order to protect the reputation of, and goodwill associated with, the Mark.
Toward that end, Licensee acknowledges and accepts the following duties:
A. Quality of Service
Licensee agrees to provide high quality Applications for use with
Cellemetry(R) Data Service. In no event shall Licensee market any Applications
that have not been submitted to Licensor for approval pursuant to the Licensor's
certification program and approved by Licensor.
B. Quality of Goods
Licensee shall construct the Equipment in full compliance with
all guidelines and specifications promulgated by the Federal Communications
Commission and any state regulatory commission, and to the highest standards
applicable in the industry. To the extent that it is applicable, Licensee shall
apply for and obtain certification by the Underwriters Laboratories for the
Equipment.
C. Use of Mark
Licensee shall apply the Mark only in accordance with the
provisions of Sections VII and VIII hereof.
D. Inspection
Licensor shall have the right at any time to conduct during
regular business hours an examination of any services or Applications provided
and materials or Equipment produced by or for Licensee on or with which the Mark
is used at Licensee's facilities to determine compliance of such services,
Applications, materials, and Equipment with the requirements of this Agreement,
the trademark usage guidelines, and the applicable standards set forth in
Section V.B. hereof (the "Standards"). Licensee shall furnish such samples as
Licensor may request for examination. If at any time such services,
Applications, materials, or Equipment shall, in the sole opinion of Licensor,
fail to conform with those Standards, Licensor or its authorized representative
shall so notify Licensee. Upon such notification Licensee shall promptly cease
to use the Mark on or with such
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services, Applications, materials, and Equipment and shall not use such
services, Applications, materials, and Equipment for any purpose until the
Standards have been met to the satisfaction of Licensor.
E. Legal Compliance
Licensee agrees to comply, at its own expense, with all
applicable laws, ordinances, and regulations of federal, state, county, or
municipal authorities. Licensee agrees to notify Licensor in writing within five
(5) days of the commencement of any action, suit, or proceeding, and of the
issuance of any order, writ, injunction, award, or decree of any court, agency,
or other governmental instrumentality, which could have a material adverse
effect on Licensee's ability to engage in the Business.
F. Business Practices
Licensee shall not engage in any trade practice or other
activity which is harmful to the goodwill or reflects unfavorably on the Mark or
on the reputation of Licensee or Licensor or which constitutes deceptive or
unfair competition, consumer fraud, or misrepresentation.
VI. FEES AND REPORTING
A. Initial Fee
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
VII. MARK
A. Licensor acknowledges and agrees to the following: (i) Cellemetry is
the owner of all right, title, and interest in and to the Mark, and (ii)
Licensor is a wholly-owned indirect subsidiary of Cellemetry, and Cellemetry
controls the manner of use of the Mark under the related company doctrine of
federal trademark law and, accordingly, Licensor has been authorized by
Cellemetry to enter into this Agreement.
B. With respect to Licensee's use of the Mark pursuant to this
Agreement, Licensee acknowledges and agrees to the following:
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1. Licensee shall use only the Mark designated by Licensor and
shall use it only in the manner authorized and permitted by Licensor, and only
in accordance with the written and graphic guidelines provided for the correct
reproduction, application and presentation of the Mark.
2. Licensee shall use the Mark only in connection with the
conduct of the Business in the Territory.
3. Licensee shall identify Cellemetry as the owner of the Mark
in conjunction with all uses of the Mark and shall place such notices on the
Mark as are prescribed by Cellemetry.
4. Licensee shall have no right to sublicense the Mark to any
other person or entity.
5. Licensee's right to use the Mark is limited to the uses
authorized under this Agreement, and any unauthorized use constitutes an
infringement of Licensor's and Cellemetry's rights.
6. Licensee shall not use the Mark as part of its legal name
or its commercial trade name or in conjunction with any services provided by
Licensee except as provided herein.
7. Licensor and its subsidiaries make no warranties regarding
ownership of any rights in or the validity of said Mark.
8. Licensor shall have the sole authority to conduct the
defense at Licensor's expense of any suit brought against Licensee claiming that
the Mark infringes the trademark or trade name rights of a third party and to
settle any such claim or suit. Licensor shall have the sole right to engage in
infringement or unfair competition proceedings involving the Mark. Licensee
shall promptly notify Licensor of the particulars of any suit or claim brought
against Licensee based on its use of the Mark and of any suspected infringement
of or challenge to the validity, registration, or Licensor's ownership of the
Mark which occurs in the Territory, or elsewhere, should the Licensee become
aware. Licensor may, in its sole discretion, institute or defend proceedings as
it shall deem fit. If Licensor or Cellemetry undertake the prosecution or
defense of any litigation relating to the Mark, Licensee agrees to execute any
and all documents and to do whatever acts and things as may, in the opinion of
counsel for Licensor or Cellemetry, be necessary or advisable to carry out the
prosecution or defense, at Licensor's
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expense. If, in Licensor's or Cellemetry's sole judgment, any claim or suit for
infringement brought by a third party can be avoided or resolved by the
discontinuation of the use of the Mark by Licensee, Licensor shall so notify
Licensee and Licensee shall discontinue all use of the Mark pursuant to Article
XII hereof. Licensor's or Cellemetry's liability for damages to Licensee for any
loss of the use of the Mark (including any loss resulting from Cellemetry's loss
of title or ownership of the Mark or the rights thereto whether by judgment,
settlement, or otherwise) shall be limited to the sum of [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.]. THE FOREGOING SETS FORTH THE ENTIRE OBLIGATION
AND LIABILITY OF LICENSOR AND CELLEMETRY FOR BREACH OF SECTION VII(A) AND FOR
INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS.
9. Licensee acknowledges and agrees that the Mark is valid.
Licensee shall not directly or indirectly contest the validity, registration, or
Cellemetry's ownership of the Mark.
10. Licensee's use of the Mark pursuant to this Agreement does
not give Licensee any ownership interest or other interest in or to the Mark,
except the license granted in this Agreement. Any and all goodwill arising from
Licensee's use of the Mark shall inure solely and exclusively to the benefit of
Cellemetry, and upon expiration or termination of this Agreement and the license
granted by it, no monetary amount shall be assigned as attributable to any
goodwill associated with Licensee's use of the Mark.
11. Licensor and Cellemetry have and retain the following
rights, among others:
(a) The right to use the Mark itself, as a corporate
or trade name, in connection with regional and national advertising, and with
selling products and services, both within and outside the Territory;
(b) The right to grant licenses for use of the Mark
in addition to those licenses already granted to existing licensees of the Mark;
and
(c) The right to use the Mark in any manner
whatsoever in Cellemetry's sole discretion.
12. In the event that the Mark, including any design logos
adopted after execution of this Agreement which shall be used with the Mark,
can, in
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Licensor's sole opinion, no longer be used, Licensor reserves the right to
provide a substitute mark or design.
VIII. ADVERTISING
Recognizing the value of advertising and the importance of advertising
in establishing and maintaining the goodwill and public image of the Mark, the
parties agree as follows:
A. Licensee's Advertising
All advertising and promotion by Licensee in any manner or
medium must be conducted in a dignified manner and must conform to the written
and graphic guidelines specified by Licensor. Licensee shall display the Mark in
the manner prescribed by Licensor on all signs and all other advertising and
promotional materials used in connection with Licensee's provision of the
Applications and Equipment. If requested by Licensor, Licensee at its own
expense shall promptly provide to Licensor photocopies of all print
advertisements and promotional materials and audio/video cassettes of
radio/television advertising using the Mark. Licensee shall immediately
discontinue any use of the Mark which is inconsistent with the terms hereof on
written notice from Licensor. If Licensee mentions cellular or wireless
capabilities or remote monitoring capabilities of its Applications or Equipment
in its advertising without using the Mark in such advertising, Licensee shall
give credit to Licensor in the advertising as the owner and provider of the
technology on which the Applications or Equipment operate.
B. Materials Provided by Licensor
Licensor may provide from time to time, in its sole
discretion, advertising and promotional plans and materials, including, without
limitation, newspaper mats, television and radio tapes, promotional brochures,
and sales aids. Licensee may use all or any of these materials in its sole
discretion.
IX. CONFIDENTIALITY OF INFORMATION AND USE RESTRICTION
Any technical information furnished to Licensee under this Agreement
shall remain the property of Licensor and shall be returned to Licensor upon
request. Unless such information was previously known to Licensee free of any
obligation to keep it confidential or has been or is subsequently made public by
Licensor, it shall be held in confidence and shall be used only for the purposes
of this Agreement.
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X. EXPORT
Licensee hereby assures Licensor that it does not intend to and will
not knowingly, without the prior written consent of Licensor, conduct the
Business outside of the Territory. In the event that Licensor consents to any
such transaction, Licensee agrees to comply with all applicable United States
export control laws and regulations as they currently exist and as they may be
amended.
XI. TRANSFER OF INTEREST
A. Transfer by Licensor
Licensor shall have the right to transfer or assign all or any
part of its rights or obligations herein to any person or legal entity. If
Licensor's assignee assumes all of the obligations of Licensor under this
Agreement and sends written notice of the assignment so attesting, Licensee
shall promptly execute a general release of Licensor, and any subsidiaries,
partners, and Affiliates of Licensor, from claims against or liabilities of
Licensor or such subsidiaries, partners, or Affiliates of Licensor to the extent
that they arise under this Agreement.
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B. Transfer by Licensee
Licensee may not assign or transfer any of its rights under
this Agreement.
XII. DEFAULT AND TERMINATION
A. Termination by Licensor -- Without Notice
Licensee shall be deemed to be in default under this
Agreement, and all rights granted herein shall automatically terminate without
notice to Licensee, if Licensee becomes insolvent or makes a general assignment
for the benefit of creditors; or if a petition in bankruptcy is filed by
Licensee or against Licensee and not opposed by Licensee within sixty (60) days
of such filing; or if Licensee is adjudicated as bankrupt or insolvent; or if a
bill in equity or other proceeding for the appointment of a receiver of Licensee
or other custodian for Licensee's business or assets if filed and consented to
by Licensee; or if a receiver or other permanent or temporary custodian of
Licensee's assets or property, or any part thereof, is appointed by any court of
competent jurisdiction; or if proceedings for a composition with creditors under
any state or federal law should be instituted by or against Licensee; or if a
material final judgment remains unsatisfied or of record for thirty (30) days or
longer (unless supersedeas bond is filed); or if Licensee is dissolved; or if a
suit to foreclose any lien or mortgage against real or personal property used in
the operation of Licensee's business, the loss of which would have a material
adverse effect on Licensee, is instituted against Licensee and not dismissed
within thirty (30) days; or if execution is levied against Licensee's business
or property, the loss of which would have a material adverse effect on Licensee;
or if real or personal property of Licensee used in its business, the loss of
which would have a material adverse effect on Licensee, shall be sold after levy
thereupon by any sheriff, marshal, or constable; or if Licensee at any time
ceases to operate or otherwise abandons its business or otherwise forfeits the
right to do or transact business in any market(s) in the Territory; or if
Licensee loses any government license required to engage in the Business or
otherwise forfeits the right to do or transact business in one or more
market(s), in which event Licensee's rights under this Agreement shall
automatically terminate.
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B. Termination by Licensor - Upon Notice
Upon the occurrence of any of the following events, Licensee
shall be deemed to be in default and Licensor may, at its option, terminate this
Agreement and all rights granted hereunder without affording Licensee any
opportunity to cure the default. Said termination shall be effective immediately
upon receipt of notice by Licensee:
1. If any officer of Licensee is convicted of a felony, a
fraud, or any other crime or offense that Licensor believes is reasonably likely
to have a material adverse effect on the Mark, the goodwill associated
therewith, or Licensor's interest therein;
2. If a material threat or danger to public health or safety
results from the conduct of the Business;
3. If Licensee purports to transfer any rights or obligations
under this Agreement to any third party, contrary to the terms of this
Agreement;
4. If the Licensee contests in any court or proceeding the
validity or registration of, or Licensor's or Cellemetry's ownership of, the
Mark or other rights licensed hereunder; or
5. If Licensee fails to maintain the information furnished
hereunder in confidence or fails to restrict the transmission of information as
required herein by this Agreement.
C. Termination By Licensor - After Notice and Opportunity to Cure
Except as provided in the foregoing paragraphs and of this
Section, Licensee shall have sixty (60) days after its receipt from Licensor of
a written notice of termination within which to remedy any default hereunder
(or, if the default cannot reasonably be cured within such sixty (60) days, to
initiate within that time substantial and continuing action to cure the
default), and to provide evidence thereof to Licensor. If any such default is
not cured within that time (or, if appropriate, substantial and continuing
action to cure the default is not initiated within that time), or such longer
period as applicable law may require, this Agreement shall terminate without
further notice to Licensee effective immediately upon expiration of the sixty
(60) day period or such longer period as applicable law may require. Licensee
shall be in default hereunder for any failure
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<PAGE> 26
to comply substantially with any of the requirements imposed by this Agreement
or to carry out the terms of this Agreement in good faith. Such defaults shall
include, without limitation, the occurrence of any of the following events:
1. If Licensee fails, refuses or neglects promptly to submit
information as required under this Agreement, or makes any material false
statements in connection therewith;
2. If Licensee fails to comply, in any material respect, with
the standards for use of the Mark provided by Licensor;
3. If Licensee misuses or makes any unauthorized use of the
Mark or otherwise materially impairs the goodwill associated therewith or
Licensor's rights therein;
4. If Licensee engages in any business or markets any goods or
services under a name or mark which, in Licensor's opinion, is confusingly
similar to the Mark;
5. If Licensee, by act or omission, permits a continued
material violation in connection with the Business of any law, ordinance, rule,
or regulation of a governmental agency, in the absence of a good faith dispute
over its application or legality and without promptly resorting to an
appropriate administrative or judicial forum for relief therefrom;
6. If Licensee fails to make any payment specified herein; or
7. If Licensee refuses or neglects a request by Licensor for
sample marketing materials, advertising copy, stationery, or other materials, or
access to the premises of Licensee.
XIII. OBLIGATIONS UPON TERMINATION OR EXPIRATION
Upon termination or expiration of this Agreement, all rights granted
hereunder shall forthwith terminate, and:
A. Identification
1. Licensee shall immediately cease to hold itself out as a
present or former Licensee of Licensor.
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2. Licensee shall immediately and permanently cease to use, in
any manner whatsoever, the Mark; and all other marks and distinctive forms,
slogans, signs, symbols, monograms, and devices associated with the Mark; in
particular, Licensee shall cease to use, without limitation, all signs,
advertising materials, displays, stationery, and forms which display the Mark.
3. Licensee agrees not to use any reproduction, counterfeit,
copy, or colorable imitation of the Mark which is likely to cause confusion,
mistake, or deception, or which is likely to dilute Licensor's or Cellemetry's
rights in and to the Mark. Further, Licensee agrees not to utilize any
designation of origin or description or representation which falsely suggests or
represents an association or connection with Licensor or the Mark.
B. Payments of Monies Due
Licensee shall pay to Licensor all damages, costs, and
expenses, including reasonable attorney's fees, incurred by Licensor subsequent
to the termination or expiration of this Agreement in obtaining injunctive or
other relief for the enforcement of any provisions of this Article XIII.
XIV. INDEPENDENT STATUS AND INDEMNIFICATION
A. It is understood and agreed by the parties hereto that this
Agreement does not create a fiduciary relationship between them; that Licensee
shall remain an independent business; and that nothing in this Agreement is
intended to constitute either party as an agent, legal representative,
subsidiary, joint venturer, partner, employee, or servant of the other for any
purpose whatsoever.
B. During the term of this Agreement and any renewal hereof, Licensee
shall hold itself out to the public as an independent business using the Mark
pursuant to a license from Licensor. Licensee agrees to take such action as may
be necessary to so notify the public.
C. It is understood and agreed that nothing in this Agreement
authorizes Licensee to make any contract, agreement, warranty or representation
on Licensor's behalf, or to incur any debt or other obligation in Licensor's
name. Licensor shall in no event assume liability for, or be deemed liable
hereunder as a result of, any such action; nor shall Licensor be liable by
reason of this Agreement for any act or omission of Licensee in its conduct of
its business or for any claim or judgment arising therefrom against Licensee,
Cellemetry or Licensor. Licensee
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shall indemnify and hold Cellemetry and its Affiliates and their respective
officers, directors, employees, and stockholders harmless from and against (1)
any and all claims, whether for personal injury or otherwise, arising directly
or indirectly from, as a result of, or in connection with, the conduct of this
Business in which the Mark is used, as well as the costs, including attorney's
fees, of defending against them, and (2) damages due to any improper or
unauthorized use of the Mark.
D. In no event shall either party be liable to the other for any
incidental or consequential damages, whether foreseeable or not, arising from
any breach of the other party's obligations under this Agreement.
XV. APPROVALS AND WAIVERS
A. Whenever this Agreement requires the prior approval or consent of
Licensor, Licensee shall make a written request to Licensor therefor at least
five business days prior to the date by which Licensee needs Licensor's consent,
and such approval or consent shall be obtained in writing.
B. Licensor and Cellemetry make no warranties or guarantees upon which
Licensee may rely, and assume no liability or obligation to Licensee, by
providing any waiver, approval, consent, or suggestion to Licensee in connection
with this Agreement, or by reason of any neglect, delay or, denial of any
request therefor.
C. No failure of Licensor to exercise any power reserved to it in this
Agreement, or to insist upon compliance by Licensee with any obligation or
condition in this Agreement, and no custom or practice of the parties at
variance with the terms hereof, shall constitute a waiver of Licensor's rights
to demand exact compliance with any of the terms of this Agreement. Waiver by
Licensor of any particular default shall not affect or impair Licensor's right
with respect to any subsequent default of the same or of a different nature; nor
shall any delay, forbearance or omission by Licensor to exercise any power or
right arising out of any breach or default by Licensee of any of the terms,
provisions, or covenants of this Agreement affect or impair Licensor's rights;
nor shall such constitute a waiver by Licensor of any rights hereunder or rights
to declare any subsequent breach or default.
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D. Subsequent acceptance by Licensor of any payments due to it shall
not be deemed to be a waiver by Licensor of any preceding breach by Licensee of
any terms, covenants, or conditions of this Agreement.
XVI. NOTICES
Any and all notices required or permitted under this Agreement shall be
in writing and shall be personally delivered or mailed by certified or
registered mail, return receipt requested, to the respective parties at the
addresses set forth in the Agreement to which this Agreement is attached.
Any notice by certified or registered mail shall be deemed to have been
given at the date and time of receipt.
XVII. ENTIRE AGREEMENT
This Agreement, the documents referred to herein, and the attachments
hereto constitute the entire, full and complete agreement between Licensor and
Licensee concerning the subject matter hereof, and supersede all prior
agreements. Without limiting the foregoing, this Agreement shall be deemed to
amend and restate in its entirety and to supersede, for all purposes, any prior
agreement between the parties hereto which contemplates or has as its primary
purpose the grant of a license to use the Mark. Except for those permitted to be
made unilaterally by Licensor hereunder, no amendment, change or variance from
this Agreement shall be binding on either party unless mutually agreed to by the
parties and executed by their authorized officers or agents in writing.
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XVIII. SEVERABILITY AND CONSTRUCTION
A. Except as expressly provided to the contrary herein, each portion,
section, part, term, and/or provision of this Agreement shall be considered
severable; and if, for any reason, a portion, section, part, term, and/or
provision herein is determined to be invalid and contrary to, or in conflict
with, any existing or future law or regulation by a court or agency having valid
jurisdiction, such shall not impair the operation of, or have any other effect
upon, such other portions, sections, parts, terms, and/or provisions of this
Agreement as may remain otherwise intelligible; and the latter shall continue to
be given full force and effect and bind the parties hereof; and said invalid
portions, sections, parts, and/or provisions shall be deemed not to be a part of
this Agreement.
B. Nothing in this Agreement is intended, nor shall be deemed, to
confer any rights or remedies upon any person or legal entity other than
Licensor, Cellemetry, or Licensee, and their respective successors and assigns
as permitted by this Agreement.
C. In the event a court in a final decision rules that any provision of
this Agreement or portion thereof is unenforceable, Licensee agrees to be bound
by the maximum duty ruled enforceable by the court.
D. All captions in this Agreement are intended solely for the
convenience of the parties, and none shall be deemed to affect the meaning or
construction of any provision hereof.
E. All references herein to the masculine, neuter, or singular shall be
construed to include the masculine, feminine, neuter, or plural, where
applicable; and all acknowledgments, promises, covenants, agreements, and
obligations herein made or undertaken by Licensee shall be deemed jointly and
severally undertaken by all those executing this Agreement on behalf of
Licensee.
XIX. APPLICABLE LAW
A. THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED UNDER THE LAWS OF
THE STATE OF GEORGIA, WITHOUT REGARD TO ITS CONFLICTS OF LAWS PROVISIONS.
B. No right or remedy conferred upon or reserved to Licensor or
Licensee by this Agreement is intended to be, nor shall be deemed, exclusive of
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any other right or remedy herein or by law or equity provided or permitted, but
each shall be cumulative of every other right or remedy.
C. Nothing herein contained shall bar Licensor's or Cellemetry's right
to apply for injunctive relief against threatened conduct that will cause it
loss or damages, under applicable equity rules, including the applicable rules
for obtaining restraining orders and preliminary injunctions.
XX. ACKNOWLEDGMENTS
Licensor expressly disclaims the making of, and Licensee acknowledges
that it has not received, any warranty or guarantee, express or implied, as to
the potential volume, profits, or success resulting from the utilization of the
Mark by Licensee.
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EXHIBIT A
Trademark Licensee Agreement
List of Marks
The Mark currently designated by the Licensor for use hereunder is as
follows:
<TABLE>
<CAPTION>
Mark Date of Registration Registration Number
---- -------------------- -------------------
<S> <C> <C>
CELLEMETRY 10/01/96 Reg. No. 2,004,693
</TABLE>
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Appendix 4
NONDISCLOSURE AGREEMENT
1. Project Defined. Each party may receive from the other party
information of a non-public nature for use by such party and its officers,
directors, agents, employees and representatives, including financial and legal
advisers (collectively "Representatives"), in the course of the performance of
the Agreement to which this Nondisclosure Agreement is attached.
2. Information Defined. Each party acknowledges that, in the course of
its performance under the Agreement, it will receive certain private and
proprietary information from or about the other party or its affiliates,
including but not limited to the terms of the Agreement to which this
Nondisclosure Agreement is attached, technical, financial or business
information and models, names of customers or partners, proposed business deals,
reports, plans, market projections, software programs, data or any other private
and proprietary information relating to the Agreement which may include certain
trade secrets ("Information"). The term "Information" as used herein also
includes: (i) the fact that the Information has been made available to or is
being inspected or evaluated by such party; and (ii) any information, work
papers, analyses, compilations, projections, studies, documents, terms,
conditions, correspondence, facts or other materials derived or produced by such
party or its representatives for the other party in connection with the
Agreement. Any Information supplied by a party to the other party prior to the
execution of this Agreement shall be subject to the same treatment as the
Information made available after the execution of this Agreement.
3. Exclusions from Definition. The term "Information" as used herein
does not include any data or information that: (a) is already known to a party
at the time it is disclosed to such party; or (b) before being divulged by such
party: (i) has become generally known to the public through no wrongful act of
such party or its representatives; (ii) has been rightfully received by such
party from a third party without restriction on disclosure and without a breach
of an obligation of confidentiality running directly or indirectly to the other
party; (iii) has been approved for release by a written authorization by the
other party; or (iv) is independently developed by such party without use,
directly or indirectly, of the Information received from the other party.
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4. Nondisclosure Obligation. Each party shall keep the Information
confidential and shall not disclose such Information, in whole or in part, to
any person other than its Representatives who need to know such Information in
connection with such party's performance under the Agreement except with the
prior written consent of the other party or as otherwise permitted hereunder.
Such Representatives shall be informed by the party of the confidential nature
of the Information and shall be required by the party to agree in writing to be
bound by this Agreement. The Information shall be used by the party solely for
the purpose of performing under the Agreement, and shall not be otherwise used
for that party's own benefit or for any purpose detrimental to the interests of
the other party.
5. Standard of Protection. For the purpose of complying with the
obligations set forth herein, each party shall use efforts commensurate with
those that it employs for the protection of corresponding sensitive information
of its own, which shall in any event be no lesser a standard than the type of
efforts that would be taken by a reasonable business for the protection of its
own highly confidential information and trade secrets.
6. Compliance with Legal Process. In the event that either party is
legally requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, Civil Investigative Demand or similar
process or, in the opinion of counsel for such party, by federal or state
securities or other statutes, regulations or laws) to disclose any Information,
such party shall promptly notify the other party of such request or requirement
prior to disclosure so that the other party may seek an appropriate protective
order and/or waive compliance with the terms of this Agreement.
7. Ownership; Return of Information. All Information (including
tangible copies and computerized or electronic versions and summaries thereof)
shall remain the property of the party to which it belongs. Within ten (10) days
following the receipt of a written request from a party, the other party shall
deliver to the first party all tangible materials containing or embodying the
Information received from the other party, together with a certificate executed
by an officer of such party certifying that all such materials in such party's
possession or control have been delivered to the other party or destroyed.
Neither party shall assert directly or indirectly any right with respect to the
Information which may impair or be adverse to the other party's ownership
thereof.
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8. Remedies for Breach. Each party understands and agrees that money
damages would not be a sufficient remedy for any breach of this Agreement and
that the other party shall be entitled to seek injunctive or other equitable
relief to remedy or forestall any such breach or threatened breach. Such remedy
shall not be deemed to be the exclusive remedy for any breach of this Agreement,
but shall be in addition to all other rights and remedies available at law or in
equity.
9. No Representations or Further Obligations. Neither this Agreement
nor the disclosure of Information shall constitute or imply any promise or
intention to make any purchase of services by either party. None of the
Information which may be disclosed by either party shall constitute any
representation, warranty, assurance, guarantee or inducement by that company to
the other company of any kind, and in particular, with respect to the accuracy
or completeness of any Information or the non-infringement of trademarks,
patents, copyrights, mask protection rights or any other intellectual property
rights, or other rights of third persons. It is understood that this Agreement
does not obligate either party to enter into any further agreements or to
proceed with any possible relationship or other transaction.
10. Term; Termination. This Agreement shall terminate as to the
exchange of any new Information three (3) years after the effective date hereof.
Either party may terminate the exchange of Information under this Agreement at
any time by written notice to the other specifically referencing this Agreement.
In any event, however, the obligations of each company to maintain the
confidentiality of the Information it has received under this Agreement shall
continue for a period of three (3) years after such termination and then
terminate; provided, however, that such obligation shall continue indefinitely
as to Information constituting a trade secret under applicable law for so long
as such Information remains a trade secret.
11. No Waiver. No failure or delay by either party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder.
12. Amendment. This Agreement may not be modified, supplemented or
amended orally, but only by a writing signed by both parties hereto.
13. Applicability to Associated Parties. Any information disclosed to
Company by any of Cellemetry's affiliated companies or by any company, person
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or other entity participating with Cellemetry in any consortium, partnership,
joint venture or similar business combination in connection with the Agreement,
which would otherwise constitute Information hereunder if disclosed by
Cellemetry, shall be deemed to constitute Information under this Agreement, and
the rights of Cellemetry under this Agreement may be enforced by any such
affiliate or other entity in addition to Cellemetry with respect to any
violation relating to the Information disclosed by such affiliate or other
entity, as if such entity were also a party to this Agreement.
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EXHIBIT 10.41
AGREEMENT
This Agreement is entered into as of the 19th day of January, 1999,
between Cellemetry LLC, ("Cellemetry") and HighwayMaster Corporation ("Company")
on the following terms and conditions:
OVERVIEW. Cellemetry and Company desire to enter into an agreement under which
Company will market in the United States Applications for Railroad Locomotive or
Rail Car tracking, location, status notification (requiring forward and reverse
channel traffic), event notification (requiring only reverse channel traffic),
and data communications (the "Services") using Cellemetry's proprietary access
technology using features of a cellular network (the "Cellemetry(R) Data
Service"). Each party will provide certain products and services as set forth
herein and in accordance with the terms of this Agreement. Both parties agree to
use their best efforts to maximize the commercial use of Cellemetry(R) Data
Service with respect to the provision of Services. Each party agrees that it
will not knowingly perform or fail to perform its responsibilities under this
Agreement in such a manner as to cause harm to Cellemetry(R) Data Service.
DEFINITIONS. As used in this Agreement, the following words shall have the
definitions set forth in this Paragraph:
"Application" - Computer software and associated hardware that operates
with Cellemetry(R) Data Service to provide monitoring and
other telemetry services to customers.
"Cellemetry(R) Data Service" - [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has
been filed separately with the SEC.]
"CellularService Area" - A Metropolitan Statistical Area ("MSA") or a
Rural Service Area ("RSA") within which a cellular carrier
("Carrier") is licensed by the Federal Communications
Commission to provide cellular service, provided, however,
that if a Carrier has combined multiple MSAs and/or RSAs under
a single System ID ("SID"), the area encompassed under the
single SID shall be the Cellular Service Area.
"Gateway" - [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed
separately with the SEC.]
"Message" - A one-way broadcast over the cellular network using
Cellemetry(R) Data Service.
<PAGE> 2
"United States" or "U.S." - The forty-nine continental United States,
the District of Columbia, and Hawaii.
TERM OF AGREEMENT. This Agreement shall become effective upon its execution by
both parties and shall continue in effect for ten (10) years unless sooner
terminated as provided herein.
LICENSING PROVISIONS. During the initial and any renewal terms: (i) Cellemetry
grants Company a non-transferable, non-exclusive license to market the
Cellemetry(R) Data Service in conjunction with Applications and Services. This
license shall be limited to the Specified Market and Geographic Scope
(Territory) designated below. In the event that Company wishes to provide
Services using Cellemetry(R) Data Service in any other market or territory, it
must request from Cellemetry a separate license covering such new areas.
Cellemetry shall retain the right to consider such request in its own
discretion.
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.] Company
agrees that it will not sell or provide any Application that has not been
submitted to Cellemetry for certification and certified by Cellemetry.
Cellemetry will conduct certification in a reasonably prompt manner, pursuant to
reasonable objective technical standards.
MARKET DEFINITION. [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
GEOGRAPHIC SCOPE. The rights granted hereunder shall apply to all Cellular
Service Areas in the United States for which Cellemetry has entered or may enter
into agreements with cellular carriers to provide Cellemetry(R) Data Service.
The parties anticipate that the number of Cellular Service Areas will expand,
and Company shall not pay any additional amounts hereunder due to such
expansion. Should Company wish to provide the Services using Cellemetry(R) Data
Service in other Cellular Service Areas or in other countries, it may request
that Cellemetry enter into a separate agreement. Cellemetry may, but shall not
be obligated to, negotiate and enter into such an agreement. [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.]
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<PAGE> 3
COMPANY'S OBLIGATIONS. Company shall provide to Cellemetry by May 1, 1999, a
detailed three (3) year business plan, updated annually for a rolling three (3)
year forecast, which shall outline (i) the Company's distribution plans,
including channels of distribution and deployment schedule; (ii) a marketing
communications plan, including attending trade shows, advertising etc.; (iii)
sales support, including sales tools, sales training; etc.; and (iv) an industry
forecast with assumptions; and (v) written confirmation of company financial
viability.
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
Company agrees that it will only use radios manufactured by companies
approved by Cellemetry in connection with its provision of the Services.
Cellemetry does not presently manufacture radios, but nothing in this Agreement
shall preclude Cellemetry from manufacturing radios or from accepting a royalty
rate [Text has been omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the SEC.]
During the initial and any renewal terms, Company shall provide ongoing
support for the Applications used to provide the Services and for all related
hardware and software, including but not limited to the interface, long distance
transport circuits, local circuits, and clearinghouse hardware and software.
Company shall provide support to its customers and shall be the intermediary
between its customers and the Cellemetry(R) Data Service Gateway.
If the Company Fails to achieve the items listed in this section
entitled Company's Obligation, fails to achieve development dates in the section
entitled Licensing Provisions, or fails use its best efforts as set forth in the
Overview Section, Cellemetry may cancel this agreement as its sole and exclusive
remedy for such failures of Company after 30 days written notice to Company with
opportunity to use during such notice period.
CELLEMETRY OBLIGATIONS. Cellemetry shall, at its own expense, arrange for the
development and provide the Cellemetry(R) Data Service Gateways and arrange for
the commercial availability of the radios necessary to provide Cellemetry(R)
Data Service.
Cellemetry shall provide or make available ongoing support for
operational Gateways. Cellemetry shall notify Company of any material changes to
the Gateways within a reasonable time (at least sixty days) after they have been
made
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<PAGE> 4
and tested. In the event that Cellemetry must make changes that are not
"backward compatible," Cellemetry shall provide at least one hundred eighty
(180) days' prior written notice to Company, and will provide Company a
reasonable time to discuss the proposed change with Cellemetry and propose
alternatives, which Cellemetry shall reasonably consider. Company shall be
entitled to access to Cellemetry support for Cellemetry(R) Data Service, which
shall be provided without additional charge upon execution of this Agreement.
Cellemetry shall provide telephone problem resolution support on a
twenty-four (24) hours a day seven (7) days a week basis. At a minimum, response
times for calls received during normal business hours (8:30 a.m. - 5:30 p.m. in
the time zone of the party receiving the call Monday through Friday, holidays
excepted) is thirty (30) minutes from receipt of the call. During all other
hours calls will be returned within one (1) hour and thirty (30) minutes of
receipt of the call. Only calls relating to Network Service Affecting problems
will be returned during non-business hours. Non-Service Affecting problems
received during non-business hours will be returned the next day. Both the
Company and Cellemetry shall provide and maintain a current and up to date
twenty-four (24) hours a day seven (7) days a week Trouble Escalation Contact
List with the appropriate telephone, cellular, and/or paging numbers of the
organization and/or personnel responsible for assisting in trouble resolution
both during and after normal business hours, and a list of the holidays observed
by each party.
Cellemetry shall maintain a Gateway for testing purposes in the United
States. Cellemetry shall have the right to make changes or alterations or to
have changes or alterations made to the test Gateway or to any
commercially-deployed Gateways, including both software and hardware at any time
and from time to time during the term of this Agreement. Cellemetry shall notify
Company at least twenty-four (24) hours prior to any scheduled hardware or
software changes being performed on its commercial Gateway(s), and within
twenty-four (24) hours after any non-scheduled hardware or software changes have
been performed on its commercial Gateway(s). Cellemetry shall provide testing
facilities to Company to allow it to review material changes prior to the
release of those changes for commercial use. Cellemetry shall use its best
efforts to ensure that the changes are backward compatible. During the term of
this Agreement, the parties shall review operational issues at least every
twelve (12) months to discuss minor Gateway and other modifications that need to
be made to the equipment or services contemplated by this Agreement.
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<PAGE> 5
EXISTING CELLEMETRY COVERAGE. At the time of execution of this Agreement
Cellemetry represents and warrants that it has reliable, fully operational
Cellemetry coverage in service throughout substantially all of the geographic
coverage areas represented on the coverage map attached to this Agreement as
Appendix 1.
SERVICE LEVEL AGREEMENT. Cellemetry and the Company agree to negotiate in good
faith to attach a Service Level Agreement as a binding amendment to this
Agreement within 90 days after execution of this Agreement, with the purpose of
establishing certain minimum standards of service with which the Cellemetry(R)
Data Service must comply. The Service Level Agreement will address downtime
standards, partial coverage downtime standards, partial coverage downtime
standards, system operability, system response time, compliance with
specifications, and other technical and service standards which Cellemetry will
warrant to customer. The Service Level Agreement will contain penalties for
failure to meet Service Level Commitments, such as refunds of amounts paid for
affected airtime services, pricing reductions, assistance with fleet-wide
retrofits which result from failures, rights of cancellation, or similar
penalties. In the event the parties do not execute a Service Level Agreement
amendment to this Agreement which is satisfactory to HighwayMaster within 90
days after execution of this Agreement, Customer will have option of canceling
this Agreement without liability to Cellemetry.
DEFAULTS. Either party shall be deemed to have committed an event of default
hereunder if such party:
(a) is in default of any of its material obligations hereunder and fails to cure
such default within thirty (30) days after written notice from the first party
specifying the default and the specific actions necessary to cure same; or
(b) is grossly negligent, engages in criminal activity or fraud with respect to
the first party, any customer, or any regulatory agency; or
(c) institutes or has instituted against it, insolvency, receivership, or
bankruptcy proceedings, if such proceedings are not dismissed or stayed within
sixty (60) days after having been filed; or
(d) makes an assignment for the benefit of creditors; or
(e) dissolves or ceases to do business; or
(f) commits an event of default under or otherwise breaches the terms of any
other agreement between the parties hereto.
Upon the occurrence of an event of default by a party hereto, the other
party shall be entitled to terminate this Agreement and exercise any other
rights and
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<PAGE> 6
remedies available to it under this Agreement, or under applicable law or in
equity arising therefrom. All remedies hereunder shall be cumulative.
PAYMENTS. In consideration of the rights granted under this Agreement, Company
agrees to pay Cellemetry the amounts set forth in Appendix 2. The amounts due
and payable hereunder shall be reported to Cellemetry by Company on a monthly
basis within ten (10) business days after the end of the month, and the amounts
due shall be payable to Cellemetry within fifteen (15) days after the close of
each calendar quarter until July 1, 2000, and within fifteen (15) days after the
end of each month thereafter. Each report shall contain an explanation of the
amount of the payment and the method by which it was calculated. All payments
shall be in U.S. dollars.
Cellemetry shall have the right, not more than once in a twelve (12)
month period, through a major independent auditing firm, to audit the records
underlying the payments made under this Agreement to determine their accuracy.
Any information derived from the reports or records shall be maintained in
confidence by the auditor and Cellemetry. Company shall maintain all such
reports and records for a minimum of three (3) years after the date of the
termination or expiration of this Agreement. Should Cellemetry determine through
such an audit that Company has underpaid the amounts due under this Agreement
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.], then Company shall,
in addition to paying the difference between the amount due and the amount paid
and interest thereon at two percentage points above the prime rate published by
the Wall Street Journal on the date payment was due until the date paid,
reimburse Cellemetry for the expenses Cellemetry incurred in performing the
audit.
If any payment due under the terms of this Agreement is not paid when
due, then Company shall pay Cellemetry, in addition to the overdue amount,
interest on such overdue amount from the date it was due until it was paid at a
rate which is two percentage points above the prime rate published by the Wall
Street Journal on the date payment was due, or the maximum rate permitted by
law, whichever is less. Payment of such interest shall be in addition to any
other remedies that Cellemetry may have for Company's failure to make timely
payments.
Company shall be solely responsible for payment of any taxes (including
sales or use taxes and intangible taxes) resulting from Company's operation of
its business under this Agreement, excluding any income taxes payable by
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<PAGE> 7
Cellemetry on fees received from Company. Company agrees to hold Cellemetry
harmless from all claims and liability arising from Company's failure to report
or pay such taxes, provided Cellemetry has reported or collected sales, use and
intangible taxes as required by law.
MARKET RESEARCH. Cellemetry shall have the right, not more often than once per
calendar year, to perform market research projects with respect to Company's
existing customer base or within the industry. Cellemetry shall be responsible
for the costs of performing the market research projects, and Company agrees
that, if Cellemetry so requests, it will assist in the development of the market
definition, sampling, and questionnaire design. Cellemetry acknowledges that the
identity and characteristics of Company" customers are a trade secret of
Company, and Cellemetry will not disclose or commercially exploit such
information without the express written consent of Company.
BRAND IDENTIFICATION AND PUBLICITY. In Cellemetry's sole discretion, and subject
to the terms of the Trademark License Agreement attached hereto as Appendix 3,
the logo for Cellemetry(R) Data Service will appear in all Cellemetry(R) Data
Service-related print and sales support materials. In accordance with and as
permitted by the terms of the Trademark License Agreement, the Cellemetry name
may be omitted from the logo for Cellemetry(R) Data Service. Company agrees to
submit to Cellemetry all representative copies of, advertising, sales promotion,
press releases and other publicity matters relating to the purposes of this
Agreement wherein Cellemetry's name, marks, or logo, or the name or mark of any
Cellemetry Company is mentioned or language from which the connection of said
names, marks, or logo therewith may be inferred or implied. Cellemetry shall not
be entitled to reimbursement by Company for any approved use of the logo.
Company agrees not to publish or use such advertising, sales promotion, press
releases, or publicity matters without Cellemetry's prior written approval.
INTELLECTUAL PROPERTY. As used herein, "Intellectual Property Rights" means all
forms of intellectual property rights and protections that may be obtained for,
or may pertain to, Cellemetry(R) Data Service and may include, without
limitation, all right, title, and interest in (i) all U.S. and foreign letters
patent and all filed, pending, or potential applications for such letters
patent; (ii) all trade secret rights and equivalent rights arising under common
law, state law, Federal law, and laws of foreign countries; (iii) all mask
works, copyrights, and other literary property or authors' rights, whether or
not protected by copyright or under common law, state law, Federal law, and laws
of foreign countries; and (iv) all proprietary indicia,
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<PAGE> 8
trademarks, trade names, symbols, logos, and/or brand names under common law,
state law, Federal law, and laws of foreign countries.
Company hereby recognizes that, except as expressly set forth in this
Agreement, Cellemetry retains all Intellectual Property Rights which may be
owned by Cellemetry in Cellemetry(R) Data Service and any Information (as
defined in the Paragraph entitled "Nondisclosure") owned by Cellemetry that is
disclosed to Company under this Agreement, including any fixes, improvements, or
other derivatives thereof to the extent created by Cellemetry and not by the
Company.
Cellemetry hereby recognizes that Company retains all Intellectual
Property Rights in its system for monitoring distribution usage as described
above (by using, for example, cellular voice channel radio technology) and in
any Information (as defined in the Paragraph entitled "Nondisclosure") owned by
Company that is disclosed to Cellemetry under this Agreement, including any
fixes, improvements, or other derivatives thereof.
NOTICE. Notice or other advice required to be given hereunder shall be deemed
given when deposited, postage prepaid, in the United States Mail addressed as
follows:
Cellemetry: Cellemetry LLC
Suite 200
1600 Parkwood Circle
Atlanta, GA 30339-3769
Company: HighwayMaster Corporation
Director of Trailer Tracking
1155 East Kas Drive
Richardson, TX 75081
With a copy to: General Counsel
If either party changes its address during the term hereof, it shall so advise
the other party in writing and any notice thereafter required to be given shall
be sent by certified mail to such new address.
NONDISCLOSURE. The parties agree to comply with the terms of the Non-disclosure
Agreement that is attached hereto as Appendix 4, which shall supersede any prior
non-disclosure agreement between the parties; provided, however, notwithstanding
anything to the contrary in the Non-disclosure Agreement, that
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<PAGE> 9
the Non-disclosure Agreement shall have the same term as this Agreement and that
any obligations that by the terms of the Non-disclosure Agreement will continue
after the termination or expiration of the Non-disclosure Agreement shall
likewise continue after the termination or expiration of this Agreement.
PLANT RULES AND SECURITY REQUIREMENTS. The employees and agents of each party
shall, while on the premises of the other, comply with all plant rules and
regulations in effect at such premises, including security requirements.
LIABILITIES. Cellemetry shall have no liability to Company for any delay in
performance or for non-performance of the Services arising from any manufacturer
or supplier of any of the equipment, including any peripheral equipment,
necessary to the provision by Company of the Services.
LIMITATION OF LIABILITY. (a) EACH PARTY UNDERSTANDS THAT OCCASIONAL INTERRUPTION
OR IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE MAY OCCUR DUE TO DEFECTS IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE OR FROM PROBLEMS IN THE
PROVISION OF CELLULAR SERVICE; THAT ANY POTENTIAL HARM FROM INTERRUPTIONS OR
IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE OR IN THE PROVISION OF CELLULAR
SERVICE IS SPECULATIVE IN NATURE; AND THAT NEITHER PARTY ASSUMES ANY
RESPONSIBILITY OTHER THAN THAT CONTAINED IN THIS AGREEMENT. ACCORDINGLY, EACH
PARTY AGREES THAT EXCEPT AS LIMITED BY LAW, THE TOTAL CUMULATIVE LIABILITY OF
THE OTHER PARTY FOR LOSSES OR DAMAGES ARISING OUT OF MISTAKES, OMISSIONS,
INTERRUPTIONS, DELAYS, ERRORS, OR DEFECTS IN THE CELLEMETRY(R) DATA SERVICE
HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR IN THE PROVISION OF CELLULAR
SERVICE, OR FOR LOSSES OR DAMAGES ARISING OUT OF THE FAILURE OF EITHER PARTY TO
MAINTAIN PROPER STANDARDS OF MAINTENANCE AND OPERATION SHALL BE LIMITED SOLELY
TO THE ALLOWANCE OF A CREDIT TO THE COMPANY IN THE AMOUNT OF THE CHARGES BILLED
BY CELLEMETRY TO COMPANY FOR THE AFFECTED TRAILERS DURING THE PERIOD IN WHICH
THE SERVICE PROBLEM OCCURRED. THE CELLULAR CARRIER'S CUMULATIVE LIABILITY SHALL
IN NO EVENT EXCEED ONE THOUSAND DOLLARS ($1000.00). NEITHER PARTY SHALL HAVE ANY
LIABILITY FOR ANY MISTAKE, OMISSION, INTERRUPTION, DELAY, ERROR, OR DEFECT IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR
IN THE PROVISION OF CELLULAR SERVICE THAT DOES NOT LAST FOR AT LEAST TWENTY FOUR
(24) HOURS.
(b) NEITHER PARTY SHALL IN ANY EVENT BE LIABLE FOR SERVICE OR EQUIPMENT
INTERRUPTIONS, DELAYS IN TRANSMISSION, OR ERRORS OR DEFECTS IN SERVICE OR
EQUIPMENT WHEN CAUSED BY ACTS OF GOD,
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FIRE, WAR, RIOTS, GOVERNMENT AUTHORITIES, DEFAULT OF SUPPLIER, OR OTHER CAUSES
BEYOND THE CONTROL OF THAT PARTY.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
(d) THE LIABILITY OF EACH PARTY IN CONNECTION WITH THE PROVISION OF
CELLEMETRY(R) DATA SERVICE PROVIDED IS SUBJECT TO THE FOREGOING LIMITATIONS AND
NEITHER PARTY MAKES ANY WARRANTIES OF ANY KIND, OTHER THAN STATED IN THIS
AGREEMENT, EXPRESSED OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AS TO THE PROVISION OF
SUCH SERVICE.
LIABILITY INSURANCE. Both Cellemetry and Company, at their own expense, shall
take out and at all times during the term of this Agreement maintain commercial
general liability insurance, including products and completed operations and
contractual liability coverage, as will protect each party from claims for
bodily injury and property damage, including death, which may arise in or result
from either party's operations in carrying out the purposes of this Agreement.
Said commercial general liability coverage shall be written on an occurrence
basis with limits of not less than $1,000,000 per occurrence/aggregate. Each
party shall named the other party as an additional insured with respect to the
insurance provided under this Agreement. In addition, both parties shall
maintain statutory workers compensation and employers liability insurance in the
amount of not less than $300,000. If the use of vehicles by either party is
necessary for the execution of this Agreement, then that party shall maintain
vehicle liability insurance with a combined single limit of not less than
$1,000,000.
Certificates of such insurance shall be submitted to the other party
prior to the Application being in commercial service and at any time upon either
party's request. Certificates of insurance shall be sent to:
Cellemetry LLC HighwayMaster Corporation
Suite 200 1155 Kas Drive
1600 Parkwood Circle Richardson, TX 75081
Atlanta, GA 30339-3769
No insurance required to be maintained pursuant to this Agreement shall
be canceled without giving at least ten (10) days prior written notification to
the other party.
INDEMNIFICATION. Both parties agrees to indemnify and save harmless the other
party from any liabilities, lawsuits, penalties, claims, or demands (including
the
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costs, expenses, and reasonable attorneys fees on account thereof) that may
be made: (1) by any third party for injuries, including death, to persons or
damage to property, including theft, resulting from either Company's or
Cellemetry's negligent or willful acts or omissions or those of persons
furnished by Company or Cellemetry, its agents or subcontractors; or (2) by any
employee or former employee of either party or any of its subcontractors for
which Company's or Cellemetry's or subcontractor's liability to such employee or
former employee would otherwise be subject to payments under the state Worker's
Compensation or similar laws. Both parties agree to defend the other party, at
that party's request, against any such liability, claim, or demand. Both parties
agree to notify the other party promptly of any written claims or demands
against that party for which Company or Cellemetry is responsible hereunder.
RELATIONSHIP. Neither Company nor its subcontractors, nor the employees or
agents of any of them, shall be deemed to be Cellemetry's employees or agents,
it being understood that Company and its subcontractors are independent
contractors for all purposes and at all times, and Company and its
subcontractors shall be wholly responsible for withholding or payment of all
Federal, State, and local income and other payroll taxes with respect to their
employees, including contributions from them as required by law.
ARBITRATION. Any disputes arising hereunder with respect to the fulfillment or
interpretation of any terms or conditions hereof shall be settled by an amicable
effort by the parties.
Either party may request that any such dispute which is not amicably
settled by such efforts of the parties shall be submitted to voluntary binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), as modified herein.
Either party may initiate arbitration by filing a demand at the
regional office of the AAA closest to Cellemetry's offices. Disputes will be
heard and determined by a panel of three arbitrators. Each party will appoint
one arbitrator to serve on the panel, and the AAA will appoint one neutral
arbitrator. Neither party will communicate separately with any arbitrator. All
communications between a party and an arbitrator will be directed to the AAA for
transmittal to the arbitrator.
Either party may petition the court in the state in which the
arbitration was held to confirm, correct, or vacate the award on the grounds
stated in the Federal Arbitration Act. Nothing in this paragraph will prevent
either party from seeking
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injunctive relief against the other party (and its employees or agents) from any
judicial or administrative authority pending the resolution of a dispute or
controversy by arbitration. The arbitrators shall also decide on the liability
for costs including the reimbursement of reasonable attorneys' fees.
CHOICE OF LAW. This Agreement shall be construed in accordance with the law of
the State of Georgia without regard to its choice of law provisions.
SEVERABILITY. In the event that any one or more of the provisions contained
herein shall for any reason be held to be unenforceable in any respect under the
laws of the jurisdiction governing the entire Agreement, the Agreement shall
then be construed as if such unenforceable provision or provisions had never
been contained herein.
RELEASES VOID. Neither party shall require waivers or releases of any personal
rights from representatives or customers of the other in connection with visits
to its premises and both parties agree that no such releases or waivers shall be
pleaded by them or by third persons in any action or proceeding.
GIFTS AND GRATUITIES. The exchange or offering of any gift item, personal
service, unusual entertainment or hospitality by either party of this Agreement
to the other party is expressly prohibited. This prohibition is equally
applicable to either party's officers, employees, agents or immediate family
members. Any violation of this tenet constitutes cause for immediate
cancellation of this Agreement.
FORCE MAJEURE. Neither party shall be liable to the other for failure or
inability to perform its obligations hereunder to the extent that such failure
or inability is due to force majeure. For the purposes of this Agreement, "force
majeure" shall mean causes beyond the reasonable control of the party, including
but not limited to acts of God, acts of the public enemy, fires, floods, acts of
any government, strikes, embargoes, unusually severe weather conditions, or
inability to obtain necessary raw materials. In the event of any such situation,
the party shall be given a reasonable period of time in which to complete its
obligations, during which the other party's payment obligations shall be
suspended. Should the condition continue for a period of six (6) months, then
the other party shall have the right to terminate this Agreement without
liability to the other party except as to rights accrued as of the date of
termination.
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ASSIGNMENT. Except upon change of control of either party, neither party may
assign this Agreement without the prior written consent of the other party,
which consent shall not be unreasonably withheld.
SECTION HEADINGS. The headings of the several Sections are inserted for
convenience of reference only and are not intended to be a part of, or to affect
the meaning or interpretation of, this Agreement.
ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
Cellemetry and Company with respect to the subject matter hereof and shall not
be amended or modified without specific written provision to that effect, signed
by both parties. No oral statement of any person whomsoever shall, in any manner
or degree, modify or otherwise affect the terms and provisions of this
Agreement.
Cellemetry LLC HighwayMaster Corporation
By: (x) John K. Collings By: (x) Jana Bell
---------------------- ---------------------
Title: EVP Cellemetry LLC Title: President
------------------- ------------------
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APPENDIX 1
TOTAL CELLEMETRY COVERAGE AREA
[MAP]
<PAGE> 15
Appendix 2
Payment
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
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<PAGE> 16
Appendix 3
TRADEMARK LICENSE AGREEMENT
This Agreement is made by and between Cellemetry LLC ("Licensor"), and
Company ("Licensee").
WHEREAS, the "CELLEMETRY" mark and logo are registered trademarks of
Cellemetry Corporation ("Cellemetry"); and
WHEREAS, Licensee desires to use the "CELLEMETRY" mark in word and
logotype form (the "Mark") in connection with its provision of applications,
which consist of software programs that provide telemetry features, such as
remote meter reading, alarm monitoring, and similar functions, ("Applications")
and associated equipment, which consists of radios and devices connecting the
radios to monitoring, alarm, or similar equipment at a cellular customer's
location, ("Equipment") to facilitate the use by the cellular customer ("End
User") of Cellemetry telemetry messaging services provided by a cellular carrier
which licenses the CELLEMETRY mark and related technology from Licensor (a
"Carrier") in accordance with the terms of the agreement to which this Agreement
is attached;
WHEREAS, Cellemetry will obtain a benefit in consideration of the
advertising from Licensee's marketing using the "CELLEMETRY" mark to designate
the service with which the Applications and the Equipment are compatible; and
WHEREAS, Cellemetry has authorized Licensor to sublicense the Mark to
Licensee pursuant to the terms hereof;
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, the parties hereby agree as follows:
I. PURPOSE
Licensee proposes to engage in the business of developing and providing
certain Applications and Equipment for use by End Users to enable Carriers to
provide telemetry messaging services to such End Users using Cellemetry(R) Data
Service within the geographic territory comprising the Cellular Service Area(s)
of
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the applicable Carrier (the "Territory"). Licensee desires to use the Mark in
connection with the provision of Applications and Equipment to End Users (the
"Business") in the Territory to denote compatibility of the Applications and
Equipment with Cellemetry(R) Data Service. Licensor is willing to permit
Licensee to use the Mark in connection therewith on the terms and conditions set
forth herein.
II. LICENSE
Licensor grants to Licensee, upon the terms and conditions of this
Agreement, the non-exclusive right, license, and privilege to use the Mark only
in the Territory and only to promote the Applications in marketing material,
advertising, and publicity and on the Equipment that it provides in connection
therewith to denote the compatibility of the Equipment with Cellemetry(R) Data
Service. No license is granted herein with respect to the use of the Mark as a
trademark on the Applications or the Equipment or with respect to any other mark
owned or used by Licensor or Cellemetry, including, but not limited to,
CELLEMETRY or the Bell Symbol logo.
III. TERM
Except as otherwise provided in this Agreement, the term of this
Agreement is co-extensive with the agreement to which it is attached, and it
shall expire or terminate on the same date as that agreement.
IV. DUTIES OF LICENSOR
All duties of Licensor under this Agreement are to Licensee, and no
other party except Cellemetry, the owner of the Marks, is entitled to rely on,
enforce, or obtain relief for breach of any such obligation, either directly or
by subrogation. Licensor shall undertake the following duties:
A. Trademark Usage Guidelines
Licensor will provide Licensee with written and graphic
guidelines for the correct reproduction, application, and presentation of the
Mark, which may include Mark specimens, samples of advertisements, and clip art
indicating color, proportion, and format.
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V. DUTIES OF LICENSEE
Licensee understands and acknowledges that the proper usage of the Mark
and the use of the Mark in association with a high quality of goods and service
is important to Licensee, Licensor, Cellemetry, and other licensees of the Mark
in order to protect the reputation of, and goodwill associated with, the Mark.
Toward that end, Licensee acknowledges and accepts the following duties:
A. Quality of Service
Licensee agrees to provide high quality Applications for use
with Cellemetry(R) Data Service. In no event shall Licensee market any
Applications that have not been submitted to Licensor for approval pursuant to
the Licensor's certification program and approved by Licensor.
B. Quality of Goods
Licensee shall construct the Equipment in full compliance with
all guidelines and specifications promulgated by the Federal Communications
Commission and any state regulatory commission, and to the highest standards
applicable in the industry. To the extent that it is applicable, Licensee shall
apply for and obtain certification by the Underwriters Laboratories for the
Equipment.
C. Use of Mark
Licensee shall apply the Mark only in accordance with the
provisions of Sections VII and VIII hereof.
D. Inspection
Licensor shall have the right at any time to conduct during
regular business hours an examination of any services or Applications provided
and materials or Equipment produced by or for Licensee on or with which the Mark
is used at Licensee's facilities to determine compliance of such services,
Applications, materials, and Equipment with the requirements of this Agreement,
the trademark usage guidelines, and the applicable standards set forth in
Section V.B. hereof (the "Standards"). Licensee shall furnish such samples as
Licensor may request for examination. If at any time such services,
Applications, materials, or Equipment shall, in the sole opinion of Licensor,
fail to conform with those Standards, Licensor or its authorized representative
shall so notify Licensee. Upon such notification Licensee shall promptly cease
to use the Mark on or with such
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services, Applications, materials, and Equipment and shall not use such
services, Applications, materials, and Equipment for any purpose until the
Standards have been met to the satisfaction of Licensor.
E. Legal Compliance
Licensee agrees to comply, at its own expense, with all
applicable laws, ordinances, and regulations of federal, state, county, or
municipal authorities. Licensee agrees to notify Licensor in writing within five
(5) days of the commencement of any action, suit, or proceeding, and of the
issuance of any order, writ, injunction, award, or decree of any court, agency,
or other governmental instrumentality, which could have a material adverse
effect on Licensee's ability to engage in the Business.
F. Business Practices
Licensee shall not engage in any trade practice or other
activity which is harmful to the goodwill or reflects unfavorably on the Mark or
on the reputation of Licensee or Licensor or which constitutes deceptive or
unfair competition, consumer fraud, or misrepresentation.
VI. FEES AND REPORTING
A. Initial Fee
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
VII. MARK
A. Licensor acknowledges and agrees to the following: (i) Cellemetry is
the owner of all right, title, and interest in and to the Mark, and (ii)
Licensor is a wholly-owned indirect subsidiary of Cellemetry, and Cellemetry
controls the manner of use of the Mark under the related company doctrine of
federal trademark law and, accordingly, Licensor has been authorized by
Cellemetry to enter into this Agreement.
B. With respect to Licensee's use of the Mark pursuant to this
Agreement, Licensee acknowledges and agrees to the following:
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1. Licensee shall use only the Mark designated by Licensor and
shall use it only in the manner authorized and permitted by Licensor, and only
in accordance with the written and graphic guidelines provided for the correct
reproduction, application and presentation of the Mark.
2. Licensee shall use the Mark only in connection with the
conduct of the Business in the Territory.
3. Licensee shall identify Cellemetry as the owner of the Mark
in conjunction with all uses of the Mark and shall place such notices on the
Mark as are prescribed by Cellemetry.
4. Licensee shall have no right to sublicense the Mark to any
other person or entity.
5. Licensee's right to use the Mark is limited to the uses
authorized under this Agreement, and any unauthorized use constitutes an
infringement of Licensor's and Cellemetry's rights.
6. Licensee shall not use the Mark as part of its legal name
or its commercial trade name or in conjunction with any services provided by
Licensee except as provided herein.
7. Licensor and its subsidiaries make no warranties regarding
ownership of any rights in or the validity of said Mark.
8. Licensor shall have the sole authority to conduct the
defense at Licensor's expense of any suit brought against Licensee claiming that
the Mark infringes the trademark or trade name rights of a third party and to
settle any such claim or suit. Licensor shall have the sole right to engage in
infringement or unfair competition proceedings involving the Mark. Licensee
shall promptly notify Licensor of the particulars of any suit or claim brought
against Licensee based on its use of the Mark and of any suspected infringement
of or challenge to the validity, registration, or Licensor's ownership of the
Mark which occurs in the Territory, or elsewhere, should the Licensee become
aware. Licensor may, in its sole discretion, institute or defend proceedings as
it shall deem fit. If Licensor or Cellemetry undertake the prosecution or
defense of any litigation relating to the Mark, Licensee agrees to execute any
and all documents and to do whatever acts and things as may, in the opinion of
counsel for Licensor or Cellemetry, be necessary or advisable to carry out the
prosecution or defense, at Licensor's
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expense. If, in Licensor's or Cellemetry's sole judgment, any claim or suit for
infringement brought by a third party can be avoided or resolved by the
discontinuation of the use of the Mark by Licensee, Licensor shall so notify
Licensee and Licensee shall discontinue all use of the Mark pursuant to Article
XII hereof. Licensor's or Cellemetry's liability for damages to Licensee for
any loss of the use of the Mark (including any loss resulting from Cellemetry's
loss of title or ownership of the Mark or the rights thereto whether by
judgment, settlement, or otherwise) shall be limited to the sum of [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC]. THE FOREGOING SETS FORTH THE
ENTIRE OBLIGATION AND LIABILITY OF LICENSOR AND CELLEMETRY FOR BREACH OF SECTION
VII(A) AND FOR INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS.
9. Licensee acknowledges and agrees that the Mark is valid.
Licensee shall not directly or indirectly contest the validity, registration, or
Cellemetry's ownership of the Mark.
10. Licensee's use of the Mark pursuant to this Agreement does
not give Licensee any ownership interest or other interest in or to the Mark,
except the license granted in this Agreement. Any and all goodwill arising from
Licensee's use of the Mark shall inure solely and exclusively to the benefit of
Cellemetry, and upon expiration or termination of this Agreement and the license
granted by it, no monetary amount shall be assigned as attributable to any
goodwill associated with Licensee's use of the Mark.
11. Licensor and Cellemetry have and retain the following
rights, among others:
(a) The right to use the Mark itself, as a corporate or
trade name, in connection with regional and national advertising, and with
selling products and services, both within and outside the Territory;
(b) The right to grant licenses for use of the Mark in
addition to those licenses already granted to existing licensees of the Mark;
and
(c) The right to use the Mark in any manner whatsoever in
Cellemetry's sole discretion.
12. In the event that the Mark, including any design logos
adopted after execution of this Agreement which shall be used with the Mark,
can, in
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Licensor's sole opinion, no longer be used, Licensor reserves the right
to provide a substitute mark or design.
VIII. ADVERTISING
Recognizing the value of advertising and the importance of advertising
in establishing and maintaining the goodwill and public image of the Mark, the
parties agree as follows:
A. Licensee's Advertising
All advertising and promotion by Licensee in any manner or
medium must be conducted in a dignified manner and must conform to the written
and graphic guidelines specified by Licensor. Licensee shall display the Mark in
the manner prescribed by Licensor on all signs and all other advertising and
promotional materials used in connection with Licensee's provision of the
Applications and Equipment. If requested by Licensor, Licensee at its own
expense shall promptly provide to Licensor photocopies of all print
advertisements and promotional materials and audio/video cassettes of
radio/television advertising using the Mark. Licensee shall immediately
discontinue any use of the Mark which is inconsistent with the terms hereof on
written notice from Licensor. If Licensee mentions cellular or wireless
capabilities or remote monitoring capabilities of its Applications or Equipment
in its advertising without using the Mark in such advertising, Licensee shall
give credit to Licensor in the advertising as the owner and provider of the
technology on which the Applications or Equipment operate.
B. Materials Provided by Licensor
Licensor may provide from time to time, in its sole
discretion, advertising and promotional plans and materials, including, without
limitation, newspaper mats, television and radio tapes, promotional brochures,
and sales aids. Licensee may use all or any of these materials in its sole
discretion.
IX. CONFIDENTIALITY OF INFORMATION AND USE RESTRICTION
Any technical information furnished to Licensee under this Agreement
shall remain the property of Licensor and shall be returned to Licensor upon
request. Unless such information was previously known to Licensee free of any
obligation to keep it confidential or has been or is subsequently made public by
Licensor, it
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shall be held in confidence and shall be used only for the purposes of this
Agreement.
X. EXPORT
Licensee hereby assures Licensor that it does not intend to and will
not knowingly, without the prior written consent of Licensor, conduct the
Business outside of the Territory. In the event that Licensor consents to any
such transaction, Licensee agrees to comply with all applicable United States
export control laws and regulations as they currently exist and as they may be
amended.
XI. TRANSFER OF INTEREST
A. Transfer by Licensor
Licensor shall have the right to transfer or assign all or any
part of its rights or obligations herein to any person or legal entity. If
Licensor's assignee assumes all of the obligations of Licensor under this
Agreement and sends written notice of the assignment so attesting, Licensee
shall promptly execute a general release of Licensor, and any subsidiaries,
partners, and Affiliates of Licensor, from claims against or liabilities of
Licensor or such subsidiaries, partners, or Affiliates of Licensor to the extent
that they arise under this Agreement.
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B. Transfer by Licensee
Licensee may not assign or transfer any of its rights under
this Agreement.
XII. DEFAULT AND TERMINATION
A. Termination by Licensor -- Without Notice
Licensee shall be deemed to be in default under this
Agreement, and all rights granted herein shall automatically terminate without
notice to Licensee, if Licensee becomes insolvent or makes a general assignment
for the benefit of creditors; or if a petition in bankruptcy is filed by
Licensee or against Licensee and not opposed by Licensee within sixty (60) days
of such filing; or if Licensee is adjudicated as bankrupt or insolvent; or if a
bill in equity or other proceeding for the appointment of a receiver of Licensee
or other custodian for Licensee's business or assets if filed and consented to
by Licensee; or if a receiver or other permanent or temporary custodian of
Licensee's assets or property, or any part thereof, is appointed by any court of
competent jurisdiction; or if proceedings for a composition with creditors under
any state or federal law should be instituted by or against Licensee; or if a
material final judgment remains unsatisfied or of record for thirty (30) days or
longer (unless supersedeas bond is filed); or if Licensee is dissolved; or if a
suit to foreclose any lien or mortgage against real or personal property used in
the operation of Licensee's business, the loss of which would have a material
adverse effect on Licensee, is instituted against Licensee and not dismissed
within thirty (30) days; or if execution is levied against Licensee's business
or property, the loss of which would have a material adverse effect on Licensee;
or if real or personal property of Licensee used in its business, the loss of
which would have a material adverse effect on Licensee, shall be sold after levy
thereupon by any sheriff, marshal, or constable; or if Licensee at any time
ceases to operate or otherwise abandons its business or otherwise forfeits the
right to do or transact business in any market(s) in the Territory; or if
Licensee loses any government license required to engage in the Business or
otherwise forfeits the right to do or transact business in one or more
market(s), in which event Licensee's rights under this Agreement shall
automatically terminate.
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B. Termination by Licensor - Upon Notice
Upon the occurrence of any of the following events, Licensee
shall be deemed to be in default and Licensor may, at its option, terminate this
Agreement and all rights granted hereunder without affording Licensee any
opportunity to cure the default. Said termination shall be effective immediately
upon receipt of notice by Licensee:
1. If any officer of Licensee is convicted of a felony, a
fraud, or any other crime or offense that Licensor believes is reasonably likely
to have a material adverse effect on the Mark, the goodwill associated
therewith, or Licensor's interest therein;
2. If a material threat or danger to public health or safety
results from the conduct of the Business;
3. If Licensee purports to transfer any rights or obligations
under this Agreement to any third party, contrary to the terms of this
Agreement;
4. If the Licensee contests in any court or proceeding the
validity or registration of, or Licensor's or Cellemetry's ownership of, the
Mark or other rights licensed hereunder; or
5. If Licensee fails to maintain the information furnished
hereunder in confidence or fails to restrict the transmission of information as
required herein by this Agreement.
C. Termination By Licensor - After Notice and Opportunity to Cure
Except as provided in the foregoing paragraphs and of this
Section, Licensee shall have sixty (60) days after its receipt from Licensor of
a written notice of termination within which to remedy any default hereunder
(or, if the default cannot reasonably be cured within such sixty (60) days, to
initiate within that time substantial and continuing action to cure the
default), and to provide evidence thereof to Licensor. If any such default is
not cured within that time (or, if appropriate, substantial and continuing
action to cure the default is not initiated within that time), or such longer
period as applicable law may require, this Agreement shall terminate without
further notice to Licensee effective immediately upon expiration of the sixty
(60) day period or such longer period as applicable law may require. Licensee
shall be in default hereunder for any failure
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<PAGE> 26
to comply substantially with any of the requirements imposed by this Agreement
or to carry out the terms of this Agreement in good faith. Such defaults shall
include, without limitation, the occurrence of any of the following events:
1. If Licensee fails, refuses or neglects promptly to submit
information as required under this Agreement, or makes any material false
statements in connection therewith;
2. If Licensee fails to comply, in any material respect, with
the standards for use of the Mark provided by Licensor;
3. If Licensee misuses or makes any unauthorized use of the
Mark or otherwise materially impairs the goodwill associated therewith or
Licensor's rights therein;
4. If Licensee engages in any business or markets any goods or
services under a name or mark which, in Licensor's opinion, is confusingly
similar to the Mark;
5. If Licensee, by act or omission, permits a continued
material violation in connection with the Business of any law, ordinance, rule,
or regulation of a governmental agency, in the absence of a good faith dispute
over its application or legality and without promptly resorting to an
appropriate administrative or judicial forum for relief therefrom;
6. If Licensee fails to make any payment specified herein; or
7. If Licensee refuses or neglects a request by Licensor for
sample marketing materials, advertising copy, stationery, or other materials, or
access to the premises of Licensee.
XIII. OBLIGATIONS UPON TERMINATION OR EXPIRATION
Upon termination or expiration of this Agreement, all rights granted
hereunder shall forthwith terminate, and:
A. Identification
1. Licensee shall immediately cease to hold itself out as a
present or former Licensee of Licensor.
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2. Licensee shall immediately and permanently cease to use, in
any manner whatsoever, the Mark; and all other marks and distinctive forms,
slogans, signs, symbols, monograms, and devices associated with the Mark; in
particular, Licensee shall cease to use, without limitation, all signs,
advertising materials, displays, stationery, and forms which display the Mark.
3. Licensee agrees not to use any reproduction, counterfeit,
copy, or colorable imitation of the Mark which is likely to cause confusion,
mistake, or deception, or which is likely to dilute Licensor's or Cellemetry's
rights in and to the Mark. Further, Licensee agrees not to utilize any
designation of origin or description or representation which falsely suggests or
represents an association or connection with Licensor or the Mark.
B. Payments of Monies Due
Licensee shall pay to Licensor all damages, costs, and
expenses, including reasonable attorney's fees, incurred by Licensor subsequent
to the termination or expiration of this Agreement in obtaining injunctive or
other relief for the enforcement of any provisions of this Article XIII.
XIV. INDEPENDENT STATUS AND INDEMNIFICATION
A. It is understood and agreed by the parties hereto that this
Agreement does not create a fiduciary relationship between them; that Licensee
shall remain an independent business; and that nothing in this Agreement is
intended to constitute either party as an agent, legal representative,
subsidiary, joint venturer, partner, employee, or servant of the other for any
purpose whatsoever.
B. During the term of this Agreement and any renewal hereof, Licensee
shall hold itself out to the public as an independent business using the Mark
pursuant to a license from Licensor. Licensee agrees to take such action as may
be necessary to so notify the public.
C. It is understood and agreed that nothing in this Agreement
authorizes Licensee to make any contract, agreement, warranty or representation
on Licensor's behalf, or to incur any debt or other obligation in Licensor's
name. Licensor shall in no event assume liability for, or be deemed liable
hereunder as a result of, any such action; nor shall Licensor be liable by
reason of this Agreement for any act or omission of Licensee in its conduct of
its business or for any claim or judgment arising therefrom against Licensee,
Cellemetry or Licensor. Licensee
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shall indemnify and hold Cellemetry and its Affiliates and their respective
officers, directors, employees, and stockholders harmless from and against (1)
any and all claims, whether for personal injury or otherwise, arising directly
or indirectly from, as a result of, or in connection with, the conduct of this
Business in which the Mark is used, as well as the costs, including attorney's
fees, of defending against them, and (2) damages due to any improper or
unauthorized use of the Mark.
D. In no event shall either party be liable to the other for any
incidental or consequential damages, whether foreseeable or not, arising from
any breach of the other party's obligations under this Agreement.
XV. APPROVALS AND WAIVERS
A. Whenever this Agreement requires the prior approval or consent of
Licensor, Licensee shall make a written request to Licensor therefor at least
five business days prior to the date by which Licensee needs Licensor's consent,
and such approval or consent shall be obtained in writing.
B. Licensor and Cellemetry make no warranties or guarantees upon which
Licensee may rely, and assume no liability or obligation to Licensee, by
providing any waiver, approval, consent, or suggestion to Licensee in connection
with this Agreement, or by reason of any neglect, delay or, denial of any
request therefor.
C. No failure of Licensor to exercise any power reserved to it in this
Agreement, or to insist upon compliance by Licensee with any obligation or
condition in this Agreement, and no custom or practice of the parties at
variance with the terms hereof, shall constitute a waiver of Licensor's rights
to demand exact compliance with any of the terms of this Agreement. Waiver by
Licensor of any particular default shall not affect or impair Licensor's right
with respect to any subsequent default of the same or of a different nature; nor
shall any delay, forbearance or omission by Licensor to exercise any power or
right arising out of any breach or default by Licensee of any of the terms,
provisions, or covenants of this Agreement affect or impair Licensor's rights;
nor shall such constitute a waiver by Licensor of any rights hereunder or rights
to declare any subsequent breach or default.
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D. Subsequent acceptance by Licensor of any payments due to it shall
not be deemed to be a waiver by Licensor of any preceding breach by Licensee of
any terms, covenants, or conditions of this Agreement.
XVI. NOTICES
Any and all notices required or permitted under this Agreement shall be
in writing and shall be personally delivered or mailed by certified or
registered mail, return receipt requested, to the respective parties at the
addresses set forth in the Agreement to which this Agreement is attached.
Any notice by certified or registered mail shall be deemed to have been
given at the date and time of receipt.
XVII. ENTIRE AGREEMENT
This Agreement, the documents referred to herein, and the attachments
hereto constitute the entire, full and complete agreement between Licensor and
Licensee concerning the subject matter hereof, and supersede all prior
agreements. Without limiting the foregoing, this Agreement shall be deemed to
amend and restate in its entirety and to supersede, for all purposes, any prior
agreement between the parties hereto which contemplates or has as its primary
purpose the grant of a license to use the Mark. Except for those permitted to be
made unilaterally by Licensor hereunder, no amendment, change or variance from
this Agreement shall be binding on either party unless mutually agreed to by the
parties and executed by their authorized officers or agents in writing.
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XVIII. SEVERABILITY AND CONSTRUCTION
A. Except as expressly provided to the contrary herein, each portion,
section, part, term, and/or provision of this Agreement shall be considered
severable; and if, for any reason, a portion, section, part, term, and/or
provision herein is determined to be invalid and contrary to, or in conflict
with, any existing or future law or regulation by a court or agency having valid
jurisdiction, such shall not impair the operation of, or have any other effect
upon, such other portions, sections, parts, terms, and/or provisions of this
Agreement as may remain otherwise intelligible; and the latter shall continue to
be given full force and effect and bind the parties hereof; and said invalid
portions, sections, parts, and/or provisions shall be deemed not to be a part of
this Agreement.
B. Nothing in this Agreement is intended, nor shall be deemed, to
confer any rights or remedies upon any person or legal entity other than
Licensor, Cellemetry, or Licensee, and their respective successors and assigns
as permitted by this Agreement.
C. In the event a court in a final decision rules that any provision of
this Agreement or portion thereof is unenforceable, Licensee agrees to be bound
by the maximum duty ruled enforceable by the court.
D. All captions in this Agreement are intended solely for the
convenience of the parties, and none shall be deemed to affect the meaning or
construction of any provision hereof.
E. All references herein to the masculine, neuter, or singular shall be
construed to include the masculine, feminine, neuter, or plural, where
applicable; and all acknowledgments, promises, covenants, agreements, and
obligations herein made or undertaken by Licensee shall be deemed jointly and
severally undertaken by all those executing this Agreement on behalf of
Licensee.
XIX. APPLICABLE LAW
A. THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED UNDER THE LAWS OF
THE STATE OF GEORGIA, WITHOUT REGARD TO ITS CONFLICTS OF LAWS PROVISIONS.
B. No right or remedy conferred upon or reserved to Licensor or
Licensee by this Agreement is intended to be, nor shall be deemed, exclusive of
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<PAGE> 31
any other right or remedy herein or by law or equity provided or permitted, but
each shall be cumulative of every other right or remedy.
C. Nothing herein contained shall bar Licensor's or Cellemetry's right
to apply for injunctive relief against threatened conduct that will cause it
loss or damages, under applicable equity rules, including the applicable rules
for obtaining restraining orders and preliminary injunctions.
XX. ACKNOWLEDGMENTS
Licensor expressly disclaims the making of, and Licensee acknowledges
that it has not received, any warranty or guarantee, express or implied, as to
the potential volume, profits, or success resulting from the utilization of the
Mark by Licensee.
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EXHIBIT A
Trademark Licensee Agreement
List of Marks
The Mark currently designated by the Licensor for use hereunder is as
follows:
<TABLE>
<CAPTION>
Mark Date of Registration Registration Number
---- -------------------- -------------------
<S> <C> <C>
CELLEMETRY 10/01/96 Reg. No. 2,004,693
</TABLE>
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Appendix 4
NONDISCLOSURE AGREEMENT
1. Project Defined. Each party may receive from the other party
information of a non-public nature for use by such party and its officers,
directors, agents, employees and representatives, including financial and legal
advisers (collectively "Representatives"), in the course of the performance of
the Agreement to which this Nondisclosure Agreement is attached.
2. Information Defined. Each party acknowledges that, in the course of
its performance under the Agreement, it will receive certain private and
proprietary information from or about the other party or its affiliates,
including but not limited to the terms of the Agreement to which this
Nondisclosure Agreement is attached, technical, financial or business
information and models, names of customers or partners, proposed business deals,
reports, plans, market projections, software programs, data or any other private
and proprietary information relating to the Agreement which may include certain
trade secrets ("Information"). The term "Information" as used herein also
includes: (i) the fact that the Information has been made available to or is
being inspected or evaluated by such party; and (ii) any information, work
papers, analyses, compilations, projections, studies, documents, terms,
conditions, correspondence, facts or other materials derived or produced by such
party or its representatives for the other party in connection with the
Agreement. Any Information supplied by a party to the other party prior to the
execution of this Agreement shall be subject to the same treatment as the
Information made available after the execution of this Agreement.
3. Exclusions from Definition. The term "Information" as used herein
does not include any data or information that: (a) is already known to a party
at the time it is disclosed to such party; or (b) before being divulged by such
party: (i) has become generally known to the public through no wrongful act of
such party or its representatives; (ii) has been rightfully received by such
party from a third party without restriction on disclosure and without a breach
of an obligation of confidentiality running directly or indirectly to the other
party; (iii) has been approved for release by a written authorization by the
other party; or (iv) is independently developed by such party without use,
directly or indirectly, of the Information received from the other party.
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4. Nondisclosure Obligation. Each party shall keep the Information
confidential and shall not disclose such Information, in whole or in part, to
any person other than its Representatives who need to know such Information in
connection with such party's performance under the Agreement except with the
prior written consent of the other party or as otherwise permitted hereunder.
Such Representatives shall be informed by the party of the confidential nature
of the Information and shall be required by the party to agree in writing to be
bound by this Agreement. The Information shall be used by the party solely for
the purpose of performing under the Agreement, and shall not be otherwise used
for that party's own benefit or for any purpose detrimental to the interests of
the other party.
5. Standard of Protection. For the purpose of complying with the
obligations set forth herein, each party shall use efforts commensurate with
those that it employs for the protection of corresponding sensitive information
of its own, which shall in any event be no lesser a standard than the type of
efforts that would be taken by a reasonable business for the protection of its
own highly confidential information and trade secrets.
6. Compliance with Legal Process. In the event that either party is
legally requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, Civil Investigative Demand or similar
process or, in the opinion of counsel for such party, by federal or state
securities or other statutes, regulations or laws) to disclose any Information,
such party shall promptly notify the other party of such request or requirement
prior to disclosure so that the other party may seek an appropriate protective
order and/or waive compliance with the terms of this Agreement.
7. Ownership; Return of Information. All Information (including
tangible copies and computerized or electronic versions and summaries thereof)
shall remain the property of the party to which it belongs. Within ten (10) days
following the receipt of a written request from a party, the other party shall
deliver to the first party all tangible materials containing or embodying the
Information received from the other party, together with a certificate executed
by an officer of such party certifying that all such materials in such party's
possession or control have been delivered to the other party or destroyed.
Neither party shall assert directly or indirectly any right with respect to the
Information which may impair or be adverse to the other party's ownership
thereof.
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8. Remedies for Breach. Each party understands and agrees that money
damages would not be a sufficient remedy for any breach of this Agreement and
that the other party shall be entitled to seek injunctive or other equitable
relief to remedy or forestall any such breach or threatened breach. Such remedy
shall not be deemed to be the exclusive remedy for any breach of this Agreement,
but shall be in addition to all other rights and remedies available at law or in
equity.
9. No Representations or Further Obligations. Neither this Agreement
nor the disclosure of Information shall constitute or imply any promise or
intention to make any purchase of services by either party. None of the
Information which may be disclosed by either party shall constitute any
representation, warranty, assurance, guarantee or inducement by that company to
the other company of any kind, and in particular, with respect to the accuracy
or completeness of any Information or the non-infringement of trademarks,
patents, copyrights, mask protection rights or any other intellectual property
rights, or other rights of third persons. It is understood that this Agreement
does not obligate either party to enter into any further agreements or to
proceed with any possible relationship or other transaction.
10. Term; Termination. This Agreement shall terminate as to the
exchange of any new Information three (3) years after the effective date hereof.
Either party may terminate the exchange of Information under this Agreement at
any time by written notice to the other specifically referencing this Agreement.
In any event, however, the obligations of each company to maintain the
confidentiality of the Information it has received under this Agreement shall
continue for a period of three (3) years after such termination and then
terminate; provided, however, that such obligation shall continue indefinitely
as to Information constituting a trade secret under applicable law for so long
as such Information remains a trade secret.
11. No Waiver. No failure or delay by either party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder.
12. Amendment. This Agreement may not be modified, supplemented or
amended orally, but only by a writing signed by both parties hereto.
13. Applicability to Associated Parties. Any information disclosed to
Company by any of Cellemetry's affiliated companies or by any company, person
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or other entity participating with Cellemetry in any consortium, partnership,
joint venture or similar business combination in connection with the Agreement,
which would otherwise constitute Information hereunder if disclosed by
Cellemetry, shall be deemed to constitute Information under this Agreement, and
the rights of Cellemetry under this Agreement may be enforced by any such
affiliate or other entity in addition to Cellemetry with respect to any
violation relating to the Information disclosed by such affiliate or other
entity, as if such entity were also a party to this Agreement.
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<PAGE> 1
EXHIBIT 10.42
AGREEMENT
This Agreement is entered into as of the 19th day of January, 1999,
between Cellemetry LLC, ("Cellemetry") and HighwayMaster Corporation ("Company")
on the following terms and conditions:
OVERVIEW. Cellemetry and Company desire to enter into an agreement under which
Company will market in the United States Container (including contents)
tracking, location, status notification (requiring forward and reverse channel
traffic), event notification (requiring only reverse channel traffic), and data
communications (the "Services") using Cellemetry's proprietary access technology
using features of a cellular network (the "Cellemetry(R) Data Service"). Each
party will provide certain products and services as set forth herein and in
accordance with the terms of this Agreement. Both parties agree to use their
best efforts to maximize the commercial use of Cellemetry(R) Data Service with
respect to the provision of Services. Each party agrees that it will not
knowingly perform or fail to perform its responsibilities under this Agreement
in such a manner as to cause harm to Cellemetry(R) Data Service.
DEFINITIONS. As used in this Agreement, the following words shall have the
definitions set forth in this Paragraph:
"Application" - Computer software and associated hardware that
operates with Cellemetry(R) Data Service to provide monitoring
and other telemetry services to customers.
"Cellemetry(R) Data Service" - [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been
filed separately with the SEC.]
"CellularService Area" - A Metropolitan Statistical Area ("MSA") or a
Rural Service Area ("RSA") within which a cellular carrier
("Carrier") is licensed by the Federal Communications Commission
to provide cellular service, provided, however, that if a Carrier
has combined multiple MSAs and/or RSAs under a single System ID
("SID"), the area encompassed under the single SID shall be the
Cellular Service Area.
"Gateway" - [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed
separately with the SEC.]
"Message" - A one-way broadcast over the cellular network using
Cellemetry(R) Data Service.
<PAGE> 2
"United States" or "U.S." - The forty-nine continental United States,
the District of Columbia, and Hawaii.
TERM OF AGREEMENT. This Agreement shall become effective upon its execution by
both parties and shall continue in effect for ten (10) years unless sooner
terminated as provided herein.
LICENSING PROVISIONS. During the initial and any renewal terms: (i) Cellemetry
grants Company a non-transferable, non-exclusive license to market the
Cellemetry(R) Data Service in conjunction with Applications and Services. This
license shall be limited to the Specified Market and Geographic Scope
(Territory) designated below. In the event that Company wishes to provide
Services using Cellemetry(R) Data Service in any other market or territory, it
must request from Cellemetry a separate license covering such new areas.
Cellemetry shall retain the right to consider such request in its own
discretion.
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
MARKET DEFINITION. [Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
GEOGRAPHIC SCOPE. The rights granted hereunder shall apply to all Cellular
Service Areas in the United States for which Cellemetry has entered or may enter
into agreements with cellular carriers to provide Cellemetry(R) Data Service.
The parties anticipate that the number of Cellular Service Areas will expand,
and Company shall not pay any additional amounts hereunder due to such
expansion. Should Company wish to provide the Services using Cellemetry(R) Data
Service in other Cellular Service Areas or in other countries, it may request
that Cellemetry enter into a separate agreement. Cellemetry may, but shall not
be obligated to, negotiate and enter into such an agreement. [Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.]
COMPANY'S OBLIGATIONS. Company shall provide to Cellemetry by June 1, 1999, a
detailed three (3) year business plan, updated annually for a rolling three (3)
year forecast, which shall outline (i) the Company's distribution plans,
including channels of distribution and deployment schedule; (ii) a marketing
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<PAGE> 3
communications plan, including attending trade shows, advertising etc.; (iii)
sales support, including sales tools, sales training; etc.; and (iv) an industry
forecast with assumptions; and (v) written confirmation of company financial
viability.
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
Company agrees that it will only use radios manufactured by companies
approved by Cellemetry in connection with its provision of the Services.
Cellemetry does not presently manufacture radios, but nothing in this Agreement
shall preclude Cellemetry from manufacturing radios or from accepting a royalty
rate [Text has been omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the SEC.]
During the initial and any renewal terms, Company shall provide ongoing
support for the Applications used to provide the Services and for all related
hardware and software, including but not limited to the interface, long distance
transport circuits, local circuits, and clearinghouse hardware and software.
Company shall provide support to its customers and shall be the intermediary
between its customers and the Cellemetry(R) Data Service Gateway.
If the Company Fails to achieve the items listed in this section
entitled Company's Obligation, fails to achieve development dates in the section
entitled Licensing Provisions, or fails use its best efforts as set forth in the
Overview Section, Cellemetry may cancel this agreement as its sole and exclusive
remedy for such failures of Company after 30 days written notice to Company with
opportunity to use during such notice period.
CELLEMETRY OBLIGATIONS. Cellemetry shall, at its own expense, arrange for the
development and provide the Cellemetry(R) Data Service Gateways and arrange for
the commercial availability of the radios necessary to provide Cellemetry(R)
Data Service.
Cellemetry shall provide or make available ongoing support for
operational Gateways. Cellemetry shall notify Company of any material changes to
the Gateways within a reasonable time (at least sixty days) after they have been
made and tested. In the event that Cellemetry must make changes that are not
"backward compatible," Cellemetry shall provide at least one hundred eighty
(180) days' prior written notice to Company, and will provide Company a
reasonable time to discuss the proposed change with Cellemetry and propose
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<PAGE> 4
alternatives, which Cellemetry shall reasonably consider. Company shall be
entitled to access to Cellemetry support for Cellemetry(R) Data Service, which
shall be provided without additional charge upon execution of this Agreement.
Cellemetry shall provide telephone problem resolution support on a
twenty-four (24) hours a day seven (7) days a week basis. At a minimum, response
times for calls received during normal business hours (8:30 a.m. - 5:30 p.m. in
the time zone of the party receiving the call Monday through Friday, holidays
excepted) is thirty (30) minutes from receipt of the call. During all other
hours calls will be returned within one (1) hour and thirty (30) minutes of
receipt of the call. Only calls relating to Network Service Affecting problems
will be returned during non-business hours. Non-Service Affecting problems
received during non-business hours will be returned the next day. Both the
Company and Cellemetry shall provide and maintain a current and up to date
twenty-four (24) hours a day seven (7) days a week Trouble Escalation Contact
List with the appropriate telephone, cellular, and/or paging numbers of the
organization and/or personnel responsible for assisting in trouble resolution
both during and after normal business hours, and a list of the holidays observed
by each party.
Cellemetry shall maintain a Gateway for testing purposes in the United
States. Cellemetry shall have the right to make changes or alterations or to
have changes or alterations made to the test Gateway or to any
commercially-deployed Gateways, including both software and hardware at any time
and from time to time during the term of this Agreement. Cellemetry shall notify
Company at least twenty-four (24) hours prior to any scheduled hardware or
software changes being performed on its commercial Gateway(s), and within
twenty-four (24) hours after any non-scheduled hardware or software changes have
been performed on its commercial Gateway(s). Cellemetry shall provide testing
facilities to Company to allow it to review material changes prior to the
release of those changes for commercial use. Cellemetry shall use its best
efforts to ensure that the changes are backward compatible. During the term of
this Agreement, the parties shall review operational issues at least every
twelve (12) months to discuss minor Gateway and other modifications that need to
be made to the equipment or services contemplated by this Agreement.
EXISTING CELLEMETRY COVERAGE. At the time of execution of this Agreement
Cellemetry represents and warrants that it has reliable, fully operational
Cellemetry coverage in service throughout substantially all of the geographic
coverage areas represented on the coverage map attached to this Agreement as
Appendix 1.
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<PAGE> 5
SERVICE LEVEL AGREEMENT. Cellemetry and the Company agree to negotiate in good
faith to attach a Service Level Agreement as a binding amendment to this
Agreement within 90 days after execution of this Agreement, with the purpose of
establishing certain minimum standards of service with which the Cellemetry(R)
Data Service must comply. The Service Level Agreement will address downtime
standards, partial coverage downtime standards, partial coverage downtime
standards, system operability, system response time, compliance with
specifications, and other technical and service standards which Cellemetry will
warrant to customer. The Service Level Agreement will contain penalties for
failure to meet Service Level Commitments, such as refunds of amounts paid for
affected airtime services, pricing reductions, assistance with fleet-wide
retrofits which result from failures, rights of cancellation, or similar
penalties. In the event the parties do not execute a Service Level Agreement
amendment to this Agreement which is satisfactory to HighwayMaster within 90
days after execution of this Agreement, Customer will have option of canceling
this Agreement without liability to Cellemetry.
DEFAULTS. Either party shall be deemed to have committed an event of default
hereunder if such party:
(a) is in default of any of its material obligations hereunder and fails to cure
such default within thirty (30) days after written notice from the first party
specifying the default and the specific actions necessary to cure same; or
(b) is grossly negligent, engages in criminal activity or fraud with respect to
the first party, any customer, or any regulatory agency; or
(c) institutes or has instituted against it, insolvency, receivership, or
bankruptcy proceedings, if such proceedings are not dismissed or stayed within
sixty (60) days after having been filed; or
(d) makes an assignment for the benefit of creditors; or
(e) dissolves or ceases to do business; or
(f) commits an event of default under or otherwise breaches the terms of any
other agreement between the parties hereto.
Upon the occurrence of an event of default by a party hereto, the other
party shall be entitled to terminate this Agreement and exercise any other
rights and remedies available to it under this Agreement, or under applicable
law or in equity arising therefrom. All remedies hereunder shall be cumulative.
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<PAGE> 6
PAYMENTS. In consideration of the rights granted under this Agreement, Company
agrees to pay Cellemetry the amounts set forth in Appendix 2. The amounts due
and payable hereunder shall be reported to Cellemetry by Company on a monthly
basis within ten (10) business days after the end of the month, and the amounts
due shall be payable to Cellemetry within fifteen (15) days after the close of
each calendar quarter until July 1, 2000, and within fifteen (15) days after the
end of each month thereafter. Each report shall contain an explanation of the
amount of the payment and the method by which it was calculated. All payments
shall be in U.S. dollars.
Cellemetry shall have the right, not more than once in a twelve (12)
month period, through a major independent auditing firm, to audit the records
underlying the payments made under this Agreement to determine their accuracy.
Any information derived from the reports or records shall be maintained in
confidence by the auditor and Cellemetry. Company shall maintain all such
reports and records for a minimum of three (3) years after the date of the
termination or expiration of this Agreement. Should Cellemetry determine through
such an audit that Company has underpaid the amounts due under this [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.], then Company shall, in
addition to paying the difference between the amount due and the amount paid and
interest thereon at two percentage points above the prime rate published by the
Wall Street Journal on the date payment was due until the date paid, reimburse
Cellemetry for the expenses Cellemetry incurred in performing the audit.
If any payment due under the terms of this Agreement is not paid when
due, then Company shall pay Cellemetry, in addition to the overdue amount,
interest on such overdue amount from the date it was due until it was paid at a
rate which is two percentage points above the prime rate published by the Wall
Street Journal on the date payment was due, or the maximum rate permitted by
law, whichever is less. Payment of such interest shall be in addition to any
other remedies that Cellemetry may have for Company's failure to make timely
payments.
Company shall be solely responsible for payment of any taxes (including
sales or use taxes and intangible taxes) resulting from Company's operation of
its business under this Agreement, excluding any income taxes payable by
Cellemetry on fees received from Company. Company agrees to hold Cellemetry
harmless from all claims and liability arising from Company's failure to report
or pay such taxes, provided Cellemetry has reported or collected sales, use and
intangible taxes as required by law.
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<PAGE> 7
MARKET RESEARCH. Cellemetry shall have the right, not more often than once per
calendar year, to perform market research projects with respect to Company's
existing customer base or within the industry. Cellemetry shall be responsible
for the costs of performing the market research projects, and Company agrees
that, if Cellemetry so requests, it will assist in the development of the market
definition, sampling, and questionnaire design. Cellemetry acknowledges that the
identity and characteristics of Company" customers are a trade secret of
Company, and Cellemetry will not disclose or commercially exploit such
information without the express written consent of Company.
BRAND IDENTIFICATION AND PUBLICITY. In Cellemetry's sole discretion, and subject
to the terms of the Trademark License Agreement attached hereto as Appendix 3,
the logo for Cellemetry(R) Data Service will appear in all Cellemetry(R) Data
Service-related print and sales support materials. In accordance with and as
permitted by the terms of the Trademark License Agreement, the Cellemetry name
may be omitted from the logo for Cellemetry(R) Data Service. Company agrees to
submit to Cellemetry all representative copies of, advertising, sales promotion,
press releases and other publicity matters relating to the purposes of this
Agreement wherein Cellemetry's name, marks, or logo, or the name or mark of any
Cellemetry Company is mentioned or language from which the connection of said
names, marks, or logo therewith may be inferred or implied. Cellemetry shall not
be entitled to reimbursement by Company for any approved use of the logo.
Company agrees not to publish or use such advertising, sales promotion, press
releases, or publicity matters without Cellemetry's prior written approval.
INTELLECTUAL PROPERTY. As used herein, "Intellectual Property Rights" means all
forms of intellectual property rights and protections that may be obtained for,
or may pertain to, Cellemetry(R) Data Service and may include, without
limitation, all right, title, and interest in (i) all U.S. and foreign letters
patent and all filed, pending, or potential applications for such letters
patent; (ii) all trade secret rights and equivalent rights arising under common
law, state law, Federal law, and laws of foreign countries; (iii) all mask
works, copyrights, and other literary property or authors' rights, whether or
not protected by copyright or under common law, state law, Federal law, and laws
of foreign countries; and (iv) all proprietary indicia, trademarks, trade names,
symbols, logos, and/or brand names under common law, state law, Federal law, and
laws of foreign countries.
Company hereby recognizes that, except as expressly set forth in this
Agreement, Cellemetry retains all Intellectual Property Rights which may be
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<PAGE> 8
owned by Cellemetry in Cellemetry(R) Data Service and any Information (as
defined in the Paragraph entitled "Nondisclosure") owned by Cellemetry that is
disclosed to Company under this Agreement, including any fixes, improvements, or
other derivatives thereof to the extent created by Cellemetry and not by the
Company.
Cellemetry hereby recognizes that Company retains all Intellectual
Property Rights in its system for monitoring distribution usage as described
above (by using, for example, cellular voice channel radio technology) and in
any Information (as defined in the Paragraph entitled "Nondisclosure") owned by
Company that is disclosed to Cellemetry under this Agreement, including any
fixes, improvements, or other derivatives thereof.
NOTICE. Notice or other advice required to be given hereunder shall be deemed
given when deposited, postage prepaid, in the United States Mail addressed as
follows:
Cellemetry: Cellemetry LLC
Suite 200
1600 Parkwood Circle
Atlanta, GA 30339-3769
Company: HighwayMaster Corporation
Director of Trailer Tracking
1155 East Kas Drive
Richardson, TX 75081
With a copy to: General Counsel
If either party changes its address during the term hereof, it shall so advise
the other party in writing and any notice thereafter required to be given shall
be sent by certified mail to such new address.
NONDISCLOSURE. The parties agree to comply with the terms of the Non-disclosure
Agreement that is attached hereto as Appendix 4, which shall supersede any prior
non-disclosure agreement between the parties; provided, however, notwithstanding
anything to the contrary in the Non-disclosure Agreement, that the
Non-disclosure Agreement shall have the same term as this Agreement and that any
obligations that by the terms of the Non-disclosure Agreement will continue
after the termination or expiration of the Non-disclosure Agreement shall
likewise continue after the termination or expiration of this Agreement.
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<PAGE> 9
PLANT RULES AND SECURITY REQUIREMENTS. The employees and agents of each party
shall, while on the premises of the other, comply with all plant rules and
regulations in effect at such premises, including security requirements.
LIABILITIES. Cellemetry shall have no liability to Company for any delay in
performance or for non-performance of the Services arising from any manufacturer
or supplier of any of the equipment, including any peripheral equipment,
necessary to the provision by Company of the Services.
LIMITATION OF LIABILITY. (a) EACH PARTY UNDERSTANDS THAT OCCASIONAL INTERRUPTION
OR IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE MAY OCCUR DUE TO DEFECTS IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE OR FROM PROBLEMS IN THE
PROVISION OF CELLULAR SERVICE; THAT ANY POTENTIAL HARM FROM INTERRUPTIONS OR
IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE OR IN THE PROVISION OF CELLULAR
SERVICE IS SPECULATIVE IN NATURE; AND THAT NEITHER PARTY ASSUMES ANY
RESPONSIBILITY OTHER THAN THAT CONTAINED IN THIS AGREEMENT. ACCORDINGLY, EACH
PARTY AGREES THAT EXCEPT AS LIMITED BY LAW, THE TOTAL CUMULATIVE LIABILITY OF
THE OTHER PARTY FOR LOSSES OR DAMAGES ARISING OUT OF MISTAKES, OMISSIONS,
INTERRUPTIONS, DELAYS, ERRORS, OR DEFECTS IN THE CELLEMETRY(R) DATA SERVICE
HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR IN THE PROVISION OF CELLULAR
SERVICE, OR FOR LOSSES OR DAMAGES ARISING OUT OF THE FAILURE OF EITHER PARTY TO
MAINTAIN PROPER STANDARDS OF MAINTENANCE AND OPERATION SHALL BE LIMITED SOLELY
TO THE ALLOWANCE OF A CREDIT TO THE COMPANY IN THE AMOUNT OF THE CHARGES BILLED
BY CELLEMETRY TO COMPANY FOR THE AFFECTED TRAILERS DURING THE PERIOD IN WHICH
THE SERVICE PROBLEM OCCURRED. THE CELLULAR CARRIER'S CUMULATIVE LIABILITY SHALL
IN NO EVENT EXCEED ONE THOUSAND DOLLARS ($1000.00). NEITHER PARTY SHALL HAVE ANY
LIABILITY FOR ANY MISTAKE, OMISSION, INTERRUPTION, DELAY, ERROR, OR DEFECT IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR
IN THE PROVISION OF CELLULAR SERVICE THAT DOES NOT LAST FOR AT LEAST TWENTY FOUR
(24) HOURS.
(b) NEITHER PARTY shall in ANY event be liable for Service or equipment
interruptions, delays in transmission, or errors or defects in Service or
equipment when caused by acts of God, fire, war, riots, government authorities,
default of supplier, or other causes beyond THE CONTROL OF THAT PARTY. [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.]
(d) THE LIABILITY OF EACH PARTY IN CONNECTION WITH THE PROVISION OF
CELLEMETRY(R) DATA SERVICE PROVIDED IS SUBJECT TO
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THE FOREGOING LIMITATIONS AND NEITHER PARTY MAKES ANY WARRANTIES OF ANY KIND,
OTHER THAN STATED IN THIS AGREEMENT, EXPRESSED OR IMPLIED, INCLUDING THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AS TO THE
PROVISION OF SUCH SERVICE.
LIABILITY INSURANCE. Both Cellemetry and Company, at their own expense, shall
take out and at all times during the term of this Agreement maintain commercial
general liability insurance, including products and completed operations and
contractual liability coverage, as will protect each party from claims for
bodily injury and property damage, including death, which may arise in or result
from either party's operations in carrying out the purposes of this Agreement.
Said commercial general liability coverage shall be written on an occurrence
basis with limits of not less than $1,000,000 per occurrence/aggregate. Each
party shall named the other party as an additional insured with respect to the
insurance provided under this Agreement. In addition, both parties shall
maintain statutory workers compensation and employers liability insurance in the
amount of not less than $300,000. If the use of vehicles by either party is
necessary for the execution of this Agreement, then that party shall maintain
vehicle liability insurance with a combined single limit of not less than
$1,000,000.
Certificates of such insurance shall be submitted to the other party
prior to the Application being in commercial service and at any time upon either
party's request. Certificates of insurance shall be sent to:
Cellemetry LLC HighwayMaster Corporation
Suite 200 1155 Kas Drive
1600 Parkwood Circle Richardson, TX 75081
Atlanta, GA 30339-3769
No insurance required to be maintained pursuant to this Agreement shall
be canceled without giving at least ten (10) days prior written notification to
the other party.
INDEMNIFICATION. Both parties agrees to indemnify and save harmless the other
party from any liabilities, lawsuits, penalties, claims, or demands (including
the costs, expenses, and reasonable attorneys fees on account thereof) that may
be made: (1) by any third party for injuries, including death, to persons or
damage to property, including theft, resulting from either Company's or
Cellemetry's negligent or willful acts or omissions or those of persons
furnished by Company or Cellemetry, its agents or subcontractors; or (2) by any
employee or former
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employee of either party or any of its subcontractors for which Company's or
Cellemetry's or subcontractor's liability to such employee or former employee
would otherwise be subject to payments under the state Worker's Compensation or
similar laws. Both parties agree to defend the other party, at that party's
request, against any such liability, claim, or demand. Both parties agree to
notify the other party promptly of any written claims or demands against that
party for which Company or Cellemetry is responsible hereunder.
RELATIONSHIP. Neither Company nor its subcontractors, nor the employees or
agents of any of them, shall be deemed to be Cellemetry's employees or agents,
it being understood that Company and its subcontractors are independent
contractors for all purposes and at all times, and Company and its
subcontractors shall be wholly responsible for withholding or payment of all
Federal, State, and local income and other payroll taxes with respect to their
employees, including contributions from them as required by law.
ARBITRATION. Any disputes arising hereunder with respect to the fulfillment or
interpretation of any terms or conditions hereof shall be settled by an amicable
effort by the parties.
Either party may request that any such dispute which is not amicably
settled by such efforts of the parties shall be submitted to voluntary binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), as modified herein.
Either party may initiate arbitration by filing a demand at the
regional office of the AAA closest to Cellemetry's offices. Disputes will be
heard and determined by a panel of three arbitrators. Each party will appoint
one arbitrator to serve on the panel, and the AAA will appoint one neutral
arbitrator. Neither party will communicate separately with any arbitrator. All
communications between a party and an arbitrator will be directed to the AAA for
transmittal to the arbitrator.
Either party may petition the court in the state in which the
arbitration was held to confirm, correct, or vacate the award on the grounds
stated in the Federal Arbitration Act. Nothing in this paragraph will prevent
either party from seeking injunctive relief against the other party (and its
employees or agents) from any judicial or administrative authority pending the
resolution of a dispute or controversy by arbitration. The arbitrators shall
also decide on the liability for costs including the reimbursement of reasonable
attorneys' fees.
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CHOICE OF LAW. This Agreement shall be construed in accordance with the law of
the State of Georgia without regard to its choice of law provisions.
SEVERABILITY. In the event that any one or more of the provisions contained
herein shall for any reason be held to be unenforceable in any respect under the
laws of the jurisdiction governing the entire Agreement, the Agreement shall
then be construed as if such unenforceable provision or provisions had never
been contained herein.
RELEASES VOID. Neither party shall require waivers or releases of any personal
rights from representatives or customers of the other in connection with visits
to its premises and both parties agree that no such releases or waivers shall be
pleaded by them or by third persons in any action or proceeding.
GIFTS AND GRATUITIES. The exchange or offering of any gift item, personal
service, unusual entertainment or hospitality by either party of this Agreement
to the other party is expressly prohibited. This prohibition is equally
applicable to either party's officers, employees, agents or immediate family
members. Any violation of this tenet constitutes cause for immediate
cancellation of this Agreement.
FORCE MAJEURE. Neither party shall be liable to the other for failure or
inability to perform its obligations hereunder to the extent that such failure
or inability is due to force majeure. For the purposes of this Agreement, "force
majeure" shall mean causes beyond the reasonable control of the party, including
but not limited to acts of God, acts of the public enemy, fires, floods, acts of
any government, strikes, embargoes, unusually severe weather conditions, or
inability to obtain necessary raw materials. In the event of any such situation,
the party shall be given a reasonable period of time in which to complete its
obligations, during which the other party's payment obligations shall be
suspended. Should the condition continue for a period of six (6) months, then
the other party shall have the right to terminate this Agreement without
liability to the other party except as to rights accrued as of the date of
termination.
ASSIGNMENT. Except upon change of control of either party, neither party may
assign this Agreement without the prior written consent of the other party,
which consent shall not be unreasonably withheld.
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SECTION HEADINGS. The headings of the several Sections are inserted for
convenience of reference only and are not intended to be a part of, or to affect
the meaning or interpretation of, this Agreement.
ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
Cellemetry and Company with respect to the subject matter hereof and shall not
be amended or modified without specific written provision to that effect, signed
by both parties. No oral statement of any person whomsoever shall, in any manner
or degree, modify or otherwise affect the terms and provisions of this
Agreement.
Cellemetry LLC HighwayMaster Corporation
By: (x) John K. Collings By: (x) Jana Bell
-------------------------- -----------------------------
Title: EVP Cellemetry LLC Title: President
----------------------- --------------------------
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APPENDIX 1
TOTAL CELLEMETRY COVERAGE AREA
[MAP]
<PAGE> 15
Appendix 2
Payment
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
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Appendix 3
TRADEMARK LICENSE AGREEMENT
This Agreement is made by and between Cellemetry LLC ("Licensor"), and
Company ("Licensee").
WHEREAS, the "CELLEMETRY" mark and logo are registered trademarks of
Cellemetry Corporation ("Cellemetry"); and
WHEREAS, Licensee desires to use the "CELLEMETRY" mark in word and
logotype form (the "Mark") in connection with its provision of applications,
which consist of software programs that provide telemetry features, such as
remote meter reading, alarm monitoring, and similar functions, ("Applications")
and associated equipment, which consists of radios and devices connecting the
radios to monitoring, alarm, or similar equipment at a cellular customer's
location, ("Equipment") to facilitate the use by the cellular customer ("End
User") of Cellemetry telemetry messaging services provided by a cellular carrier
which licenses the CELLEMETRY mark and related technology from Licensor (a
"Carrier") in accordance with the terms of the agreement to which this Agreement
is attached;
WHEREAS, Cellemetry will obtain a benefit in consideration of the
advertising from Licensee's marketing using the "CELLEMETRY" mark to designate
the service with which the Applications and the Equipment are compatible; and
WHEREAS, Cellemetry has authorized Licensor to sublicense the Mark to
Licensee pursuant to the terms hereof;
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, the parties hereby agree as follows:
I. PURPOSE
Licensee proposes to engage in the business of developing and providing
certain Applications and Equipment for use by End Users to enable Carriers to
provide telemetry messaging services to such End Users using Cellemetry(R) Data
Service within the geographic territory comprising the Cellular Service Area(s)
of
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the applicable Carrier (the "Territory"). Licensee desires to use the Mark in
connection with the provision of Applications and Equipment to End Users (the
"Business") in the Territory to denote compatibility of the Applications and
Equipment with Cellemetry(R) Data Service. Licensor is willing to permit
Licensee to use the Mark in connection therewith on the terms and conditions set
forth herein.
II. LICENSE
Licensor grants to Licensee, upon the terms and conditions of this
Agreement, the non-exclusive right, license, and privilege to use the Mark only
in the Territory and only to promote the Applications in marketing material,
advertising, and publicity and on the Equipment that it provides in connection
therewith to denote the compatibility of the Equipment with Cellemetry(R) Data
Service. No license is granted herein with respect to the use of the Mark as a
trademark on the Applications or the Equipment or with respect to any other mark
owned or used by Licensor or Cellemetry, including, but not limited to,
CELLEMETRY or the Bell Symbol logo.
III. TERM
Except as otherwise provided in this Agreement, the term of this
Agreement is co-extensive with the agreement to which it is attached, and it
shall expire or terminate on the same date as that agreement.
IV. DUTIES OF LICENSOR
All duties of Licensor under this Agreement are to Licensee, and no
other party except Cellemetry, the owner of the Marks, is entitled to rely on,
enforce, or obtain relief for breach of any such obligation, either directly or
by subrogation. Licensor shall undertake the following duties:
A. Trademark Usage Guidelines
Licensor will provide Licensee with written and graphic
guidelines for the correct reproduction, application, and presentation of the
Mark, which may include Mark specimens, samples of advertisements, and clip art
indicating color, proportion, and format.
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V. DUTIES OF LICENSEE
Licensee understands and acknowledges that the proper usage of the Mark
and the use of the Mark in association with a high quality of goods and service
is important to Licensee, Licensor, Cellemetry, and other licensees of the Mark
in order to protect the reputation of, and goodwill associated with, the Mark.
Toward that end, Licensee acknowledges and accepts the following duties:
A. Quality of Service
Licensee agrees to provide high quality Applications for use with
Cellemetry(R) Data Service. In no event shall Licensee market any Applications
that have not been submitted to Licensor for approval pursuant to the Licensor's
certification program and approved by Licensor.
B. Quality of Goods
Licensee shall construct the Equipment in full compliance with
all guidelines and specifications promulgated by the Federal Communications
Commission and any state regulatory commission, and to the highest standards
applicable in the industry. To the extent that it is applicable, Licensee shall
apply for and obtain certification by the Underwriters Laboratories for the
Equipment.
C. Use of Mark
Licensee shall apply the Mark only in accordance with the
provisions of Sections VII and VIII hereof.
D. Inspection
Licensor shall have the right at any time to conduct during
regular business hours an examination of any services or Applications provided
and materials or Equipment produced by or for Licensee on or with which the Mark
is used at Licensee's facilities to determine compliance of such services,
Applications, materials, and Equipment with the requirements of this Agreement,
the trademark usage guidelines, and the applicable standards set forth in
Section V.B. hereof (the "Standards"). Licensee shall furnish such samples as
Licensor may request for examination. If at any time such services,
Applications, materials, or Equipment shall, in the sole opinion of Licensor,
fail to conform with those Standards, Licensor or its authorized representative
shall so notify Licensee. Upon such notification Licensee shall promptly cease
to use the Mark on or with such
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services, Applications, materials, and Equipment and shall not use such
services, Applications, materials, and Equipment for any purpose until the
Standards have been met to the satisfaction of Licensor.
E. Legal Compliance
Licensee agrees to comply, at its own expense, with all
applicable laws, ordinances, and regulations of federal, state, county, or
municipal authorities. Licensee agrees to notify Licensor in writing within five
(5) days of the commencement of any action, suit, or proceeding, and of the
issuance of any order, writ, injunction, award, or decree of any court, agency,
or other governmental instrumentality, which could have a material adverse
effect on Licensee's ability to engage in the Business.
F. Business Practices
Licensee shall not engage in any trade practice or other
activity which is harmful to the goodwill or reflects unfavorably on the Mark or
on the reputation of Licensee or Licensor or which constitutes deceptive or
unfair competition, consumer fraud, or misrepresentation.
VI. FEES AND REPORTING
A. Initial Fee
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
VII. MARK
A. Licensor acknowledges and agrees to the following: (i) Cellemetry is
the owner of all right, title, and interest in and to the Mark, and (ii)
Licensor is a wholly-owned indirect subsidiary of Cellemetry, and Cellemetry
controls the manner of use of the Mark under the related company doctrine of
federal trademark law and, accordingly, Licensor has been authorized by
Cellemetry to enter into this Agreement.
B. With respect to Licensee's use of the Mark pursuant to this
Agreement, Licensee acknowledges and agrees to the following:
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1. Licensee shall use only the Mark designated by Licensor and
shall use it only in the manner authorized and permitted by Licensor, and only
in accordance with the written and graphic guidelines provided for the correct
reproduction, application and presentation of the Mark.
2. Licensee shall use the Mark only in connection with the
conduct of the Business in the Territory.
3. Licensee shall identify Cellemetry as the owner of the Mark
in conjunction with all uses of the Mark and shall place such notices on the
Mark as are prescribed by Cellemetry.
4. Licensee shall have no right to sublicense the Mark to any
other person or entity.
5. Licensee's right to use the Mark is limited to the uses
authorized under this Agreement, and any unauthorized use constitutes an
infringement of Licensor's and Cellemetry's rights.
6. Licensee shall not use the Mark as part of its legal name
or its commercial trade name or in conjunction with any services provided by
Licensee except as provided herein.
7. Licensor and its subsidiaries make no warranties regarding
ownership of any rights in or the validity of said Mark.
8. Licensor shall have the sole authority to conduct the
defense at Licensor's expense of any suit brought against Licensee claiming that
the Mark infringes the trademark or trade name rights of a third party and to
settle any such claim or suit. Licensor shall have the sole right to engage in
infringement or unfair competition proceedings involving the Mark. Licensee
shall promptly notify Licensor of the particulars of any suit or claim brought
against Licensee based on its use of the Mark and of any suspected infringement
of or challenge to the validity, registration, or Licensor's ownership of the
Mark which occurs in the Territory, or elsewhere, should the Licensee become
aware. Licensor may, in its sole discretion, institute or defend proceedings as
it shall deem fit. If Licensor or Cellemetry undertake the prosecution or
defense of any litigation relating to the Mark, Licensee agrees to execute any
and all documents and to do whatever acts and things as may, in the opinion of
counsel for Licensor or Cellemetry, be necessary or advisable to carry out the
prosecution or defense, at Licensor's
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expense. If, in Licensor's or Cellemetry's sole judgment, any claim or suit
for infringement brought by a third party can be avoided or resolved by the
discontinuation of the use of the Mark by Licensee, Licensor shall so notify
Licensee and Licensee shall discontinue all use of the Mark pursuant to Article
XII hereof. Licensor's or Cellemetry's liability for damages to Licensee for
any loss of the use of the Mark (including any loss resulting from Cellemetry's
loss of title or ownership of the Mark or the rights thereto whether by
judgment, settlement, or otherwise) shall be limited to the sum of [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC]. THE FOREGOING SETS FORTH THE
ENTIRE OBLIGATION AND LIABILITY OF LICENSOR AND CELLEMETRY FOR BREACH OF
SECTION VII(A) AND FOR INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS.
9. Licensee acknowledges and agrees that the Mark is valid.
Licensee shall not directly or indirectly contest the validity, registration, or
Cellemetry's ownership of the Mark.
10. Licensee's use of the Mark pursuant to this Agreement does
not give Licensee any ownership interest or other interest in or to the Mark,
except the license granted in this Agreement. Any and all goodwill arising from
Licensee's use of the Mark shall inure solely and exclusively to the benefit of
Cellemetry, and upon expiration or termination of this Agreement and the license
granted by it, no monetary amount shall be assigned as attributable to any
goodwill associated with Licensee's use of the Mark.
11. Licensor and Cellemetry have and retain the following
rights, among others:
(a) The right to use the Mark itself, as a corporate or
trade name, in connection with regional and national
advertising, and with selling products and services, both
within and outside the Territory;
(b) The right to grant licenses for use of the Mark in
addition to those licenses already granted to existing
licensees of the Mark; and
(c) The right to use the Mark in any manner whatsoever
in Cellemetry's sole discretion.
12. In the event that the Mark, including any design logos
adopted after execution of this Agreement which shall be used with the Mark,
can, in
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Licensor's sole opinion, no longer be used, Licensor reserves the right to
provide a substitute mark or design.
VIII. ADVERTISING
Recognizing the value of advertising and the importance of advertising
in establishing and maintaining the goodwill and public image of the Mark, the
parties agree as follows:
A. Licensee's Advertising
All advertising and promotion by Licensee in any manner or
medium must be conducted in a dignified manner and must conform to the written
and graphic guidelines specified by Licensor. Licensee shall display the Mark in
the manner prescribed by Licensor on all signs and all other advertising and
promotional materials used in connection with Licensee's provision of the
Applications and Equipment. If requested by Licensor, Licensee at its own
expense shall promptly provide to Licensor photocopies of all print
advertisements and promotional materials and audio/video cassettes of
radio/television advertising using the Mark. Licensee shall immediately
discontinue any use of the Mark which is inconsistent with the terms hereof on
written notice from Licensor. If Licensee mentions cellular or wireless
capabilities or remote monitoring capabilities of its Applications or Equipment
in its advertising without using the Mark in such advertising, Licensee shall
give credit to Licensor in the advertising as the owner and provider of the
technology on which the Applications or Equipment operate.
B. Materials Provided by Licensor
Licensor may provide from time to time, in its sole
discretion, advertising and promotional plans and materials, including, without
limitation, newspaper mats, television and radio tapes, promotional brochures,
and sales aids. Licensee may use all or any of these materials in its sole
discretion.
IX. CONFIDENTIALITY OF INFORMATION AND USE RESTRICTION
Any technical information furnished to Licensee under this Agreement
shall remain the property of Licensor and shall be returned to Licensor upon
request. Unless such information was previously known to Licensee free of any
obligation to keep it confidential or has been or is subsequently made public by
Licensor, it
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shall be held in confidence and shall be used only for the purposes of this
Agreement.
X. EXPORT
Licensee hereby assures Licensor that it does not intend to and will
not knowingly, without the prior written consent of Licensor, conduct the
Business outside of the Territory. In the event that Licensor consents to any
such transaction, Licensee agrees to comply with all applicable United States
export control laws and regulations as they currently exist and as they may be
amended.
XI. TRANSFER OF INTEREST
A. Transfer by Licensor
Licensor shall have the right to transfer or assign all or any
part of its rights or obligations herein to any person or legal entity. If
Licensor's assignee assumes all of the obligations of Licensor under this
Agreement and sends written notice of the assignment so attesting, Licensee
shall promptly execute a general release of Licensor, and any subsidiaries,
partners, and Affiliates of Licensor, from claims against or liabilities of
Licensor or such subsidiaries, partners, or Affiliates of Licensor to the extent
that they arise under this Agreement.
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B. Transfer by Licensee
Licensee may not assign or transfer any of its rights under
this Agreement.
XII. DEFAULT AND TERMINATION
A. Termination by Licensor -- Without Notice
Licensee shall be deemed to be in default under this
Agreement, and all rights granted herein shall automatically terminate without
notice to Licensee, if Licensee becomes insolvent or makes a general assignment
for the benefit of creditors; or if a petition in bankruptcy is filed by
Licensee or against Licensee and not opposed by Licensee within sixty (60) days
of such filing; or if Licensee is adjudicated as bankrupt or insolvent; or if a
bill in equity or other proceeding for the appointment of a receiver of Licensee
or other custodian for Licensee's business or assets if filed and consented to
by Licensee; or if a receiver or other permanent or temporary custodian of
Licensee's assets or property, or any part thereof, is appointed by any court of
competent jurisdiction; or if proceedings for a composition with creditors under
any state or federal law should be instituted by or against Licensee; or if a
material final judgment remains unsatisfied or of record for thirty (30) days or
longer (unless supersedeas bond is filed); or if Licensee is dissolved; or if a
suit to foreclose any lien or mortgage against real or personal property used in
the operation of Licensee's business, the loss of which would have a material
adverse effect on Licensee, is instituted against Licensee and not dismissed
within thirty (30) days; or if execution is levied against Licensee's business
or property, the loss of which would have a material adverse effect on Licensee;
or if real or personal property of Licensee used in its business, the loss of
which would have a material adverse effect on Licensee, shall be sold after levy
thereupon by any sheriff, marshal, or constable; or if Licensee at any time
ceases to operate or otherwise abandons its business or otherwise forfeits the
right to do or transact business in any market(s) in the Territory; or if
Licensee loses any government license required to engage in the Business or
otherwise forfeits the right to do or transact business in one or more
market(s), in which event Licensee's rights under this Agreement shall
automatically terminate.
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B. Termination by Licensor - Upon Notice
Upon the occurrence of any of the following events, Licensee
shall be deemed to be in default and Licensor may, at its option, terminate this
Agreement and all rights granted hereunder without affording Licensee any
opportunity to cure the default. Said termination shall be effective immediately
upon receipt of notice by Licensee:
1. If any officer of Licensee is convicted of a felony, a
fraud, or any other crime or offense that Licensor believes is reasonably likely
to have a material adverse effect on the Mark, the goodwill associated
therewith, or Licensor's interest therein;
2. If a material threat or danger to public health or safety
results from the conduct of the Business;
3. If Licensee purports to transfer any rights or obligations
under this Agreement to any third party, contrary to the terms of this
Agreement;
4. If the Licensee contests in any court or proceeding the
validity or registration of, or Licensor's or Cellemetry's ownership of, the
Mark or other rights licensed hereunder; or
5. If Licensee fails to maintain the information furnished
hereunder in confidence or fails to restrict the transmission of information as
required herein by this Agreement.
C. Termination By Licensor - After Notice and Opportunity to Cure
Except as provided in the foregoing paragraphs and of this
Section, Licensee shall have sixty (60) days after its receipt from Licensor of
a written notice of termination within which to remedy any default hereunder
(or, if the default cannot reasonably be cured within such sixty (60) days, to
initiate within that time substantial and continuing action to cure the
default), and to provide evidence thereof to Licensor. If any such default is
not cured within that time (or, if appropriate, substantial and continuing
action to cure the default is not initiated within that time), or such longer
period as applicable law may require, this Agreement shall terminate without
further notice to Licensee effective immediately upon expiration of the sixty
(60) day period or such longer period as applicable law may require. Licensee
shall be in default hereunder for any failure
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to comply substantially with any of the requirements imposed by this Agreement
or to carry out the terms of this Agreement in good faith. Such defaults shall
include, without limitation, the occurrence of any of the following events:
1. If Licensee fails, refuses or neglects promptly to submit
information as required under this Agreement, or makes any material false
statements in connection therewith;
2. If Licensee fails to comply, in any material respect, with
the standards for use of the Mark provided by Licensor;
3. If Licensee misuses or makes any unauthorized use of the
Mark or otherwise materially impairs the goodwill associated therewith or
Licensor's rights therein;
4. If Licensee engages in any business or markets any goods or
services under a name or mark which, in Licensor's opinion, is confusingly
similar to the Mark;
5. If Licensee, by act or omission, permits a continued
material violation in connection with the Business of any law, ordinance, rule,
or regulation of a governmental agency, in the absence of a good faith dispute
over its application or legality and without promptly resorting to an
appropriate administrative or judicial forum for relief therefrom;
6. If Licensee fails to make any payment specified herein; or
7. If Licensee refuses or neglects a request by Licensor for
sample marketing materials, advertising copy, stationery, or other materials, or
access to the premises of Licensee.
XIII. OBLIGATIONS UPON TERMINATION OR EXPIRATION
Upon termination or expiration of this Agreement, all rights granted
hereunder shall forthwith terminate, and:
A. Identification
1. Licensee shall immediately cease to hold itself out as a
present or former Licensee of Licensor.
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2. Licensee shall immediately and permanently cease to use, in
any manner whatsoever, the Mark; and all other marks and distinctive forms,
slogans, signs, symbols, monograms, and devices associated with the Mark; in
particular, Licensee shall cease to use, without limitation, all signs,
advertising materials, displays, stationery, and forms which display the Mark.
3. Licensee agrees not to use any reproduction, counterfeit,
copy, or colorable imitation of the Mark which is likely to cause confusion,
mistake, or deception, or which is likely to dilute Licensor's or Cellemetry's
rights in and to the Mark. Further, Licensee agrees not to utilize any
designation of origin or description or representation which falsely suggests or
represents an association or connection with Licensor or the Mark.
B. Payments of Monies Due
Licensee shall pay to Licensor all damages, costs, and
expenses, including reasonable attorney's fees, incurred by Licensor subsequent
to the termination or expiration of this Agreement in obtaining injunctive or
other relief for the enforcement of any provisions of this Article XIII.
XIV. INDEPENDENT STATUS AND INDEMNIFICATION
A. It is understood and agreed by the parties hereto that this
Agreement does not create a fiduciary relationship between them; that Licensee
shall remain an independent business; and that nothing in this Agreement is
intended to constitute either party as an agent, legal representative,
subsidiary, joint venturer, partner, employee, or servant of the other for any
purpose whatsoever.
B. During the term of this Agreement and any renewal hereof, Licensee
shall hold itself out to the public as an independent business using the Mark
pursuant to a license from Licensor. Licensee agrees to take such action as may
be necessary to so notify the public.
C. It is understood and agreed that nothing in this Agreement
authorizes Licensee to make any contract, agreement, warranty or representation
on Licensor's behalf, or to incur any debt or other obligation in Licensor's
name. Licensor shall in no event assume liability for, or be deemed liable
hereunder as a result of, any such action; nor shall Licensor be liable by
reason of this Agreement for any act or omission of Licensee in its conduct of
its business or for any claim or judgment arising therefrom against Licensee,
Cellemetry or Licensor. Licensee
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shall indemnify and hold Cellemetry and its Affiliates and their respective
officers, directors, employees, and stockholders harmless from and against (1)
any and all claims, whether for personal injury or otherwise, arising directly
or indirectly from, as a result of, or in connection with, the conduct of this
Business in which the Mark is used, as well as the costs, including attorney's
fees, of defending against them, and (2) damages due to any improper or
unauthorized use of the Mark.
D. In no event shall either party be liable to the other for any
incidental or consequential damages, whether foreseeable or not, arising from
any breach of the other party's obligations under this Agreement.
XV. APPROVALS AND WAIVERS
A. Whenever this Agreement requires the prior approval or consent of
Licensor, Licensee shall make a written request to Licensor therefor at least
five business days prior to the date by which Licensee needs Licensor's consent,
and such approval or consent shall be obtained in writing.
B. Licensor and Cellemetry make no warranties or guarantees upon which
Licensee may rely, and assume no liability or obligation to Licensee, by
providing any waiver, approval, consent, or suggestion to Licensee in connection
with this Agreement, or by reason of any neglect, delay or, denial of any
request therefor.
C. No failure of Licensor to exercise any power reserved to it in this
Agreement, or to insist upon compliance by Licensee with any obligation or
condition in this Agreement, and no custom or practice of the parties at
variance with the terms hereof, shall constitute a waiver of Licensor's rights
to demand exact compliance with any of the terms of this Agreement. Waiver by
Licensor of any particular default shall not affect or impair Licensor's right
with respect to any subsequent default of the same or of a different nature; nor
shall any delay, forbearance or omission by Licensor to exercise any power or
right arising out of any breach or default by Licensee of any of the terms,
provisions, or covenants of this Agreement affect or impair Licensor's rights;
nor shall such constitute a waiver by Licensor of any rights hereunder or rights
to declare any subsequent breach or default.
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D. Subsequent acceptance by Licensor of any payments due to it shall
not be deemed to be a waiver by Licensor of any preceding breach by Licensee of
any terms, covenants, or conditions of this Agreement.
XVI. NOTICES
Any and all notices required or permitted under this Agreement shall be
in writing and shall be personally delivered or mailed by certified or
registered mail, return receipt requested, to the respective parties at the
addresses set forth in the Agreement to which this Agreement is attached.
Any notice by certified or registered mail shall be deemed to have been
given at the date and time of receipt.
XVII. ENTIRE AGREEMENT
This Agreement, the documents referred to herein, and the attachments
hereto constitute the entire, full and complete agreement between Licensor and
Licensee concerning the subject matter hereof, and supersede all prior
agreements. Without limiting the foregoing, this Agreement shall be deemed to
amend and restate in its entirety and to supersede, for all purposes, any prior
agreement between the parties hereto which contemplates or has as its primary
purpose the grant of a license to use the Mark. Except for those permitted to be
made unilaterally by Licensor hereunder, no amendment, change or variance from
this Agreement shall be binding on either party unless mutually agreed to by the
parties and executed by their authorized officers or agents in writing.
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XVIII. SEVERABILITY AND CONSTRUCTION
A. Except as expressly provided to the contrary herein, each portion,
section, part, term, and/or provision of this Agreement shall be considered
severable; and if, for any reason, a portion, section, part, term, and/or
provision herein is determined to be invalid and contrary to, or in conflict
with, any existing or future law or regulation by a court or agency having valid
jurisdiction, such shall not impair the operation of, or have any other effect
upon, such other portions, sections, parts, terms, and/or provisions of this
Agreement as may remain otherwise intelligible; and the latter shall continue to
be given full force and effect and bind the parties hereof; and said invalid
portions, sections, parts, and/or provisions shall be deemed not to be a part of
this Agreement.
B. Nothing in this Agreement is intended, nor shall be deemed, to
confer any rights or remedies upon any person or legal entity other than
Licensor, Cellemetry, or Licensee, and their respective successors and assigns
as permitted by this Agreement.
C. In the event a court in a final decision rules that any provision of
this Agreement or portion thereof is unenforceable, Licensee agrees to be bound
by the maximum duty ruled enforceable by the court.
D. All captions in this Agreement are intended solely for the
convenience of the parties, and none shall be deemed to affect the meaning or
construction of any provision hereof.
E. All references herein to the masculine, neuter, or singular shall be
construed to include the masculine, feminine, neuter, or plural, where
applicable; and all acknowledgments, promises, covenants, agreements, and
obligations herein made or undertaken by Licensee shall be deemed jointly and
severally undertaken by all those executing this Agreement on behalf of
Licensee.
XIX. APPLICABLE LAW
A. THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED UNDER THE LAWS OF
THE STATE OF GEORGIA, WITHOUT REGARD TO ITS CONFLICTS OF LAWS PROVISIONS.
B. No right or remedy conferred upon or reserved to Licensor or
Licensee by this Agreement is intended to be, nor shall be deemed, exclusive of
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any other right or remedy herein or by law or equity provided or permitted, but
each shall be cumulative of every other right or remedy.
C. Nothing herein contained shall bar Licensor's or Cellemetry's right
to apply for injunctive relief against threatened conduct that will cause it
loss or damages, under applicable equity rules, including the applicable rules
for obtaining restraining orders and preliminary injunctions.
XX. ACKNOWLEDGMENTS
Licensor expressly disclaims the making of, and Licensee acknowledges
that it has not received, any warranty or guarantee, express or implied, as to
the potential volume, profits, or success resulting from the utilization of the
Mark by Licensee.
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EXHIBIT A
Trademark Licensee Agreement
List of Marks
The Mark currently designated by the Licensor for use hereunder is as
follows:
<TABLE>
<CAPTION>
Mark Date of Registration Registration Number
---- -------------------- -------------------
<S> <C> <C>
CELLEMETRY 10/01/96 Reg. No. 2,004,693
</TABLE>
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Appendix 4
NONDISCLOSURE AGREEMENT
1. Project Defined. Each party may receive from the other party
information of a non-public nature for use by such party and its officers,
directors, agents, employees and representatives, including financial and legal
advisers (collectively "Representatives"), in the course of the performance of
the Agreement to which this Nondisclosure Agreement is attached.
2. Information Defined. Each party acknowledges that, in the course of
its performance under the Agreement, it will receive certain private and
proprietary information from or about the other party or its affiliates,
including but not limited to the terms of the Agreement to which this
Nondisclosure Agreement is attached, technical, financial or business
information and models, names of customers or partners, proposed business deals,
reports, plans, market projections, software programs, data or any other private
and proprietary information relating to the Agreement which may include certain
trade secrets ("Information"). The term "Information" as used herein also
includes: (i) the fact that the Information has been made available to or is
being inspected or evaluated by such party; and (ii) any information, work
papers, analyses, compilations, projections, studies, documents, terms,
conditions, correspondence, facts or other materials derived or produced by such
party or its representatives for the other party in connection with the
Agreement. Any Information supplied by a party to the other party prior to the
execution of this Agreement shall be subject to the same treatment as the
Information made available after the execution of this Agreement.
3. Exclusions from Definition. The term "Information" as used herein
does not include any data or information that: (a) is already known to a party
at the time it is disclosed to such party; or (b) before being divulged by such
party: (i) has become generally known to the public through no wrongful act of
such party or its representatives; (ii) has been rightfully received by such
party from a third party without restriction on disclosure and without a breach
of an obligation of confidentiality running directly or indirectly to the other
party; (iii) has been approved for release by a written authorization by the
other party; or (iv) is independently developed by such party without use,
directly or indirectly, of the Information received from the other party.
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4. Nondisclosure Obligation. Each party shall keep the Information
confidential and shall not disclose such Information, in whole or in part, to
any person other than its Representatives who need to know such Information in
connection with such party's performance under the Agreement except with the
prior written consent of the other party or as otherwise permitted hereunder.
Such Representatives shall be informed by the party of the confidential nature
of the Information and shall be required by the party to agree in writing to be
bound by this Agreement. The Information shall be used by the party solely for
the purpose of performing under the Agreement, and shall not be otherwise used
for that party's own benefit or for any purpose detrimental to the interests of
the other party.
5. Standard of Protection. For the purpose of complying with the
obligations set forth herein, each party shall use efforts commensurate with
those that it employs for the protection of corresponding sensitive information
of its own, which shall in any event be no lesser a standard than the type of
efforts that would be taken by a reasonable business for the protection of its
own highly confidential information and trade secrets.
6. Compliance with Legal Process. In the event that either party is
legally requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, Civil Investigative Demand or similar
process or, in the opinion of counsel for such party, by federal or state
securities or other statutes, regulations or laws) to disclose any Information,
such party shall promptly notify the other party of such request or requirement
prior to disclosure so that the other party may seek an appropriate protective
order and/or waive compliance with the terms of this Agreement.
7. Ownership; Return of Information. All Information (including
tangible copies and computerized or electronic versions and summaries thereof)
shall remain the property of the party to which it belongs. Within ten (10) days
following the receipt of a written request from a party, the other party shall
deliver to the first party all tangible materials containing or embodying the
Information received from the other party, together with a certificate executed
by an officer of such party certifying that all such materials in such party's
possession or control have been delivered to the other party or destroyed.
Neither party shall assert directly or indirectly any right with respect to the
Information which may impair or be adverse to the other party's ownership
thereof.
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8. Remedies for Breach. Each party understands and agrees that money
damages would not be a sufficient remedy for any breach of this Agreement and
that the other party shall be entitled to seek injunctive or other equitable
relief to remedy or forestall any such breach or threatened breach. Such remedy
shall not be deemed to be the exclusive remedy for any breach of this Agreement,
but shall be in addition to all other rights and remedies available at law or in
equity.
9. No Representations or Further Obligations. Neither this Agreement
nor the disclosure of Information shall constitute or imply any promise or
intention to make any purchase of services by either party. None of the
Information which may be disclosed by either party shall constitute any
representation, warranty, assurance, guarantee or inducement by that company to
the other company of any kind, and in particular, with respect to the accuracy
or completeness of any Information or the non-infringement of trademarks,
patents, copyrights, mask protection rights or any other intellectual property
rights, or other rights of third persons. It is understood that this Agreement
does not obligate either party to enter into any further agreements or to
proceed with any possible relationship or other transaction.
10. Term; Termination. This Agreement shall terminate as to the
exchange of any new Information three (3) years after the effective date hereof.
Either party may terminate the exchange of Information under this Agreement at
any time by written notice to the other specifically referencing this Agreement.
In any event, however, the obligations of each company to maintain the
confidentiality of the Information it has received under this Agreement shall
continue for a period of three (3) years after such termination and then
terminate; provided, however, that such obligation shall continue indefinitely
as to Information constituting a trade secret under applicable law for so long
as such Information remains a trade secret.
11. No Waiver. No failure or delay by either party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder.
12. Amendment. This Agreement may not be modified, supplemented or
amended orally, but only by a writing signed by both parties hereto.
13. Applicability to Associated Parties. Any information disclosed to
Company by any of Cellemetry's affiliated companies or by any company, person
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or other entity participating with Cellemetry in any consortium, partnership,
joint venture or similar business combination in connection with the Agreement,
which would otherwise constitute Information hereunder if disclosed by
Cellemetry, shall be deemed to constitute Information under this Agreement, and
the rights of Cellemetry under this Agreement may be enforced by any such
affiliate or other entity in addition to Cellemetry with respect to any
violation relating to the Information disclosed by such affiliate or other
entity, as if such entity were also a party to this Agreement.
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<PAGE> 1
EXHIBIT 10.43
AGREEMENT
This Agreement is entered into as of the 7th day of January, 1999,
between Cellemetry LLC, ("Cellemetry") and HighwayMaster Corporation ("Company")
on the following terms and conditions:
OVERVIEW. Cellemetry and Company desire to enter into an agreement under which
Company will market in the United States Applications for detachable truck
trailer tracking (not including container monitoring/tracking) (the "Services")
using Cellemetry's proprietary access technology using features of a cellular
network (the "Cellemetry(R) Data Service"). Each party will provide certain
products and services as set forth herein and in accordance with the terms of
this Agreement. Both parties agree to use their best efforts to maximize the
commercial use of Cellemetry(R) Data Service with respect to the provision of
Services. Each party agrees that it will not knowingly perform or fail to
perform its responsibilities under this Agreement in such a manner as to cause
harm to Cellemetry(R) Data Service.
DEFINITIONS. As used in this Agreement, the following words shall have the
definitions set forth in this Paragraph:
"Application" - Computer software and associated hardware that operates
with Cellemetry(R) Data Service to provide monitoring and
other telemetry services to customers.
"Cellemetry(R) Data Service" - [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has
been filed separately with the SEC.]
"CellularService Area" - A Metropolitan Statistical Area ("MSA") or a
Rural Service Area ("RSA") within which a cellular carrier
("Carrier") is licensed by the Federal Communications
Commission to provide cellular service, provided, however,
that if a Carrier has combined multiple MSAs and/or RSAs under
a single System ID ("SID"), the area encompassed under the
single SID shall be the Cellular Service Area.
"Gateway" - [Text has been omitted pursuant to a request for
confidential treatment. The omitted material has been filed
separately with the SEC.]
"Message"- A one-way broadcast over the cellular network using
Cellemetry(R) Data Service.
<PAGE> 2
"United States" or "U.S." - The forty-nine continental United States,
the District of Columbia, and Hawaii.
TERM OF AGREEMENT. This Agreement shall become effective upon its execution by
both parties and shall continue in effect for ten (10) years unless sooner
terminated as provided herein.
AGREEMENT; EXCLUSIVITY. Subject to all of the terms of this Agreement, [Text has
been omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the SEC.]
MARKET DEFINITION. The product market for which the rights are granted to
Company hereunder shall be the market for detachable truck trailer tracking (not
including container monitoring/tracking), and equipment associated therewith.
GEOGRAPHIC SCOPE. The rights granted hereunder shall apply to all Cellular
Service Areas in the United States for which Cellemetry has entered or may enter
into agreements with cellular carriers to provide Cellemetry(R) Data Service.
The parties anticipate that the number of Cellular Service Areas will expand,
and Company shall not pay any additional amounts hereunder due to such
expansion. Should Company wish to provide the Services using Cellemetry(R) Data
Service in other Cellular Service Areas or in other countries, it may request
that Cellemetry enter into a separate agreement. Cellemetry may, but shall not
be obligated to, negotiate and enter into such an agreement[Text has been
omitted pursuant to a request for confidential treatment. The omitted material
has been filed separately with the SEC.]
PRODUCT DEVELOPMENT. Company shall, at its own expense, develop and provide, by
April 30, 1999, the necessary monitoring interface that is commercially
operational, with all associated documentation - methods, procedures, and
practices for integrating that interface into existing and new detachable truck
trailer tracking equipment; along with a back-end system that is commercially
operational, to allow companies to monitor such equipment as set forth above
using Cellemetry(R) Data Service, and a service center for connection to its
customers so that they will not have direct access to the Cellemetry(R) Data
Service Gateways. Cellemetry shall, at its own expense, arrange for the
development of and provide the Cellemetry(R) Data Service Gateways and arrange
for the commercial availability of the radios necessary to provide Cellemetry(R)
Data Service. Company agrees that it will only use radios manufactured by
companies approved by Cellemetry in connection with its provision of the
Services.
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<PAGE> 3
Cellemetry does not presently manufacture radios, but nothing in this Agreement
shall preclude Cellemetry from manufacturing radios or from accepting a royalty
rate [Text has been omitted pursuant to a request for confidential treatment.
The omitted material has been filed separately with the SEC.]
PRODUCT TECHNICAL SUPPORT. During the term of this Agreement, Company shall
provide ongoing support for the Applications used to provide the Services and
for all related hardware and software, including but not limited to the
interface, long distance transport circuits, local circuits, and clearinghouse
hardware and software. Company shall provide support to its customers and shall
be the intermediary between its customers and the Cellemetry(R) Data Service
Gateway. Cellemetry shall provide or make available ongoing support for
operational Gateways. Cellemetry shall notify Company of any material changes to
the Gateways within a reasonable time (at least sixty days) after they have been
made and tested. In the event that Cellemetry must make changes that are not
"backward compatible," Cellemetry shall provide at least one hundred eighty
(180) days' prior written notice to Company, and will provide Company a
reasonable time to discuss the proposed change with Cellemetry and propose
alternatives, which Cellemetry shall reasonably consider. Company shall be
entitled to access to Cellemetry support for Cellemetry(R) Data Service, which
shall be provided without additional charge upon execution of this Agreement.
Cellemetry shall provide telephone problem resolution support on a twenty-four
(24) hours a day seven (7) days a week basis. At a minimum, response times for
calls received during normal business hours (8:30 a.m. - 5:30 p.m. in the time
zone of the party receiving the call Monday through Friday, holidays excepted)
is thirty (30) minutes from receipt of the call. During all other hours calls
will be returned within one (1) hour and thirty (30) minutes of receipt of the
call. Only calls relating to Network Service Affecting problems will be returned
during non-business hours. Non-Service Affecting calls received during
non-business hours will be returned the next business day. Both the Company and
Cellemetry shall provide and maintain a current and up to date twenty-four (24)
hours a day seven (7) days a week Trouble Escalation Contact List with the
appropriate telephone, cellular, and/or paging numbers of the organization
and/or personnel responsible for assisting in trouble resolution both during and
after normal business hours, and a list of the holidays observed by each party.
Cellemetry shall maintain a Gateway for testing purposes in the United
States. Cellemetry shall have the right to make changes or alterations or to
have changes or alterations made to the test Gateway or to any
commercially-deployed Gateways, including both software and hardware, at any
time and from time to
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<PAGE> 4
time during the term of this Agreement. Cellemetry shall notify Company at least
twenty-four (24) hours prior to any scheduled hardware or software changes being
performed on its commercial Gateway(s), and within twenty-four (24) hours after
any non-scheduled hardware or software changes have been performed on its
commercial Gateway(s). Cellemetry shall provide testing facilities to Company to
allow it to review material changes prior to the release of those changes for
commercial use. Cellemetry shall use its best efforts to ensure that the changes
are backward compatible. During the term of this Agreement, the parties shall
review operational issues at least every twelve (12) months to discuss minor
Gateway and other modifications that need to be made to the equipment or
services contemplated by this Agreement.
EXISTING CELLEMETRY COVERAGE. At the time of execution of this Agreement
Cellemetry represents and warrants that it has reliable, fully operational
Cellemetry coverage in service throughout substantially all of the geographic
coverage areas represented on the coverage map attached to this Agreement as
Appendix 1.
SERVICE LEVEL AGREEMENT. Cellemetry and the Company agree to negotiate in good
faith to attach a Service Level Agreement as a binding amendment to this
Agreement within 90 days after execution of this Agreement, with the purpose of
establishing certain minimum standards of service with which the Cellemetry Data
Service must comply. The Service Level Agreement will address downtime
standards, partial coverage downtime standards, system operability, system
response time, compliance with specifications, and other technical and service
standards which Cellemetry will warrant to customer. The Service Level Agreement
will contain penalties for failure to meet Service Level Commitments, such as
refunds of amounts paid for affected airtime services, pricing reductions,
assistance with fleet-wide retrofits which result from failures, rights of
cancellation, or similar penalties. In the event the parties do not execute a
Service Level Agreement amendment to this Agreement which is satisfactory to
HighwayMaster within 90 days after execution of this Agreement, Customer will
have option of canceling this Agreement without liability to Cellemetry.
COMMITMENTS FOR MAINTAINING EXCLUSIVITY. [Text has been omitted pursuant to a
request for confidential treatment. The omitted material has been filed
separately with the SEC.]
DEFAULTS. Either party shall be deemed to have committed an event of default
hereunder if such party:
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<PAGE> 5
(a) is in default of any of its material obligations hereunder and fails to cure
such default within thirty (30) days after written notice from the first party
specifying the default and the specific actions necessary to cure same; or
(b) is grossly negligent, engages in criminal activity or fraud with respect to
the first party, any customer, or any regulatory agency; or
(c) institutes or has instituted against it, insolvency, receivership, or
bankruptcy proceedings, if such proceedings are not dismissed or stayed within
sixty (60) days after having been filed; or
(d) makes an assignment for the benefit of creditors; or
(e) dissolves or ceases to do business; or
(f) commits an event of default under or otherwise breaches
the terms of any other agreement between the parties hereto.
Upon the occurrence of an event of default by a party hereto, the other
party shall be entitled to terminate this Agreement and exercise any other
rights and remedies available to it under this Agreement, or under applicable
law or in equity arising therefrom. All remedies hereunder shall be cumulative.
PAYMENTS. In consideration of the rights granted under this Agreement, Company
agrees to pay Cellemetry the amounts set forth in Appendix 2. The amounts due
and payable hereunder shall be reported to Cellemetry by Company on a monthly
basis within ten (10) business days after the end of the month, and the amounts
due shall be payable to Cellemetry within fifteen (15) days after the close of
each calendar quarter until July 1, 2000, and within fifteen (15) days after the
end of each month thereafter. Each report shall contain an explanation of the
amount of the payment and the method by which it was calculated. All payments
shall be in U.S. dollars.
Cellemetry shall have the right, not more than once in a twelve (12)
month period, through a major independent auditing firm, to audit the records
underlying the payments made under this Agreement to determine their accuracy.
Any information derived from the reports or records shall be maintained in
confidence by the auditor and Cellemetry. Company shall maintain all such
reports and records for a minimum of three (3) years after the date of the
termination or expiration of this Agreement. Should Cellemetry determine through
such an audit that Company has underpaid the amounts due under this Agreement by
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.] then Company shall, in
addition to paying the difference between the amount due and the amount paid and
interest thereon at two percentage points above the prime rate published by the
Wall Street Journal
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<PAGE> 6
on the date payment was due until the date paid, reimburse Cellemetry for the
expenses Cellemetry incurred in performing the audit.
If any payment due under the terms of this Agreement is not paid when
due, then Company shall pay Cellemetry, in addition to the overdue amount,
interest on such overdue amount from the date it was due until it was paid at a
rate which is two percentage points above the prime rate published by the Wall
Street Journal on the date payment was due, or the maximum rate permitted by
law, whichever is less. Payment of such interest shall be in addition to any
other remedies that Cellemetry may have for Company's failure to make timely
payments.
Company shall be solely responsible for payment of any taxes (including
sales or use taxes and intangible taxes) resulting from Company's operation of
its business under this Agreement, excluding any income taxes payable by
Cellemetry on fees received from Company. Company agrees to hold Cellemetry
harmless from all claims and liability arising from Company's failure to report
or pay such taxes, provided Cellemetry has reported or collected sales, use and
intangible taxes as required by law.
MARKET RESEARCH. Cellemetry shall have the right, not more often than once per
calendar year, to perform market research projects with respect to Company's
existing customer base or within the industry. Cellemetry shall be responsible
for the costs of performing the market research projects, and Company agrees
that, if Cellemetry so requests, it will assist in the development of the market
definition, sampling, and questionnaire design. Cellemetry acknowledges that the
identity and characteristics of Company" customers are a trade secret of
Company, and Cellemetry will not disclose or commercially exploit such
information without the express written consent of Company.
BRAND IDENTIFICATION AND PUBLICITY. In Cellemetry's sole discretion, and subject
to the terms of the Trademark License Agreement attached hereto as Appendix 3,
the logo for Cellemetry(R) Data Service will appear in all Cellemetry(R) Data
Service-related print and sales support materials. In accordance with and as
permitted by the terms of the Trademark License Agreement, the Cellemetry name
may be omitted from the logo for Cellemetry(R) Data Service. Company agrees to
submit to Cellemetry all representative copies of, advertising, sales promotion,
press releases and other publicity matters relating to the purposes of this
Agreement wherein Cellemetry's name, marks, or logo, or the name or mark of any
Cellemetry Company is mentioned or language from which the connection of said
names, marks, or logo therewith may be inferred or implied. Cellemetry shall not
be entitled to reimbursement by Company for any approved use of the logo.
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<PAGE> 7
Company agrees not to publish or use such advertising, sales promotion, press
releases, or publicity matters without Cellemetry's prior written approval.
INTELLECTUAL PROPERTY. As used herein, "Intellectual Property Rights" means all
forms of intellectual property rights and protections that may be obtained for,
or may pertain to, Cellemetry(R) Data Service and may include, without
limitation, all right, title, and interest in (i) all U.S. and foreign letters
patent and all filed, pending, or potential applications for such letters
patent; (ii) all trade secret rights and equivalent rights arising under common
law, state law, Federal law, and laws of foreign countries; (iii) all mask
works, copyrights, and other literary property or authors' rights, whether or
not protected by copyright or under common law, state law, Federal law, and laws
of foreign countries; and (iv) all proprietary indicia, trademarks, trade names,
symbols, logos, and/or brand names under common law, state law, Federal law, and
laws of foreign countries.
Company hereby recognizes that, except as expressly set forth in this
Agreement, Cellemetry retains all Intellectual Property Rights which may be
owned by Cellemetry in Cellemetry(R) Data Service and any Information (as
defined in the Paragraph entitled "Nondisclosure") owned by Cellemetry that is
disclosed to Company under this Agreement, including any fixes, improvements, or
other derivatives thereof to the extent created by Cellemetry and not by the
Company.
Cellemetry hereby recognizes that Company retains all Intellectual
Property Rights in its system for monitoring distribution usage as described
above (by using, for example, cellular voice channel radio technology) and in
any Information (as defined in the Paragraph entitled "Nondisclosure") owned by
Company that is disclosed to Cellemetry under this Agreement, including any
fixes, improvements, or other derivatives thereof.
NOTICE. Notice or other advice required to be given hereunder shall be deemed
given when deposited, postage prepaid, in the United States Mail addressed as
follows:
Cellemetry: Cellemetry LLC
Suite 200
1600 Parkwood Circle
Atlanta, GA 30339-3769
Company: HighwayMaster Corporation
Director of Trailer Tracking
1155 East Kas Drive
Richardson, TX 75081
With a copy to: General Counsel
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<PAGE> 8
If either party changes its address during the term hereof, it shall so advise
the other party in writing and any notice thereafter required to be given shall
be sent by certified mail to such new address.
NONDISCLOSURE. The parties agree to comply with the terms of the Non-disclosure
Agreement that is attached hereto as Appendix 4, which shall supersede any prior
non-disclosure agreement between the parties; provided, however, notwithstanding
anything to the contrary in the Non-disclosure Agreement, that the
Non-disclosure Agreement shall have the same term as this Agreement and that any
obligations that by the terms of the Non-disclosure Agreement will continue
after the termination or expiration of the Non-disclosure Agreement shall
likewise continue after the termination or expiration of this Agreement.
PLANT RULES AND SECURITY REQUIREMENTS. The employees and agents of each party
shall, while on the premises of the other, comply with all plant rules and
regulations in effect at such premises, including security requirements.
LIABILITIES. Cellemetry shall have no liability to Company for any delay in
performance or for non-performance of the Services arising from any manufacturer
or supplier of any of the equipment, including any peripheral equipment,
necessary to the provision by Company of the Services.
LIMITATION OF LIABILITY. (a) EACH PARTY UNDERSTANDS THAT OCCASIONAL INTERRUPTION
OR IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE MAY OCCUR DUE TO DEFECTS IN
THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE OR FROM PROBLEMS IN THE
PROVISION OF CELLULAR SERVICE; THAT ANY POTENTIAL HARM FROM INTERRUPTIONS OR
IRREGULARITIES IN THE CELLEMETRY(R) DATA SERVICE OR IN THE PROVISION OF CELLULAR
SERVICE IS SPECULATIVE IN NATURE; AND THAT NEITHER PARTY ASSUMES ANY
RESPONSIBILITY OTHER THAN THAT CONTAINED IN THIS AGREEMENT. ACCORDINGLY, EACH
PARTY AGREES THAT EXCEPT AS LIMITED BY LAW, THE TOTAL CUMULATIVE LIABILITY OF
THE OTHER PARTY FOR LOSSES OR DAMAGES ARISING OUT OF MISTAKES, OMISSIONS,
INTERRUPTIONS, DELAYS, ERRORS, OR DEFECTS IN THE CELLEMETRY(R) DATA SERVICE
HARDWARE OR SOFTWARE, IN THE APPLICATION(S), OR IN THE PROVISION OF CELLULAR
SERVICE, OR FOR LOSSES OR DAMAGES ARISING OUT OF THE FAILURE OF EITHER PARTY TO
MAINTAIN PROPER STANDARDS OF MAINTENANCE AND OPERATION SHALL BE LIMITED SOLELY
TO THE ALLOWANCE OF A CREDIT TO THE COMPANY IN THE AMOUNT OF THE
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<PAGE> 9
CHARGES BILLED BY CELLEMETRY TO COMPANY FOR THE AFFECTED TRAILERS DURING THE
PERIOD IN WHICH THE SERVICE PROBLEM OCCURRED. THE CELLULAR CARRIER'S CUMULATIVE
LIABILITY SHALL IN NO EVENT EXCEED ONE THOUSAND DOLLARS ($1000.00). NEITHER
PARTY SHALL HAVE ANY LIABILITY FOR ANY MISTAKE, OMISSION, INTERRUPTION, DELAY,
ERROR, OR DEFECT IN THE CELLEMETRY(R) DATA SERVICE HARDWARE OR SOFTWARE, IN THE
APPLICATION(S), OR IN THE PROVISION OF CELLULAR SERVICE THAT DOES NOT LAST FOR
AT LEAST TWENTY FOUR (24) HOURS. (b) NEITHER PARTY shall in ANY event be liable
for Service or equipment interruptions, delays in transmission, or errors or
defects in Service or equipment when caused by acts of God, fire, war, riots,
government authorities, default of supplier, or other causes beyond THE CONTROL
OF THAT PARTY.
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
(d) THE LIABILITY OF EACH PARTY IN CONNECTION WITH THE PROVISION OF
CELLEMETRY(R) DATA SERVICE PROVIDED IS SUBJECT TO THE FOREGOING LIMITATIONS AND
NEITHER PARTY MAKES ANY WARRANTIES OF ANY KIND, OTHER THAN STATED IN THIS
AGREEMENT, EXPRESSED OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AS TO THE PROVISION OF
SUCH SERVICE.
LIABILITY INSURANCE. Both Cellemetry and Company, at their own expense, shall
take out and at all times during the term of this Agreement maintain commercial
general liability insurance, including products and completed operations and
contractual liability coverage, as will protect each party from claims for
bodily injury and property damage, including death, which may arise in or result
from either party's operations in carrying out the purposes of this Agreement.
Said commercial general liability coverage shall be written on an occurrence
basis with limits of not less than $1,000,000 per occurrence/aggregate. Each
party shall named the other party as an additional insured with respect to the
insurance provided under this Agreement. In addition, both parties shall
maintain statutory workers compensation and employers liability insurance in the
amount of not less than $300,000. If the use of vehicles by either party is
necessary for the execution of this Agreement, then that party shall maintain
vehicle liability insurance with a combined single limit of not less than
$1,000,000.
Certificates of such insurance shall be submitted to the other party
prior to the Application being in commercial service and at any time upon either
party's request. Certificates of insurance shall be sent to:
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Cellemetry LLC HighwayMaster Corporation
Suite 200 1155 Kas Drive
1600 Parkwood Circle Richardson, TX 75081
Atlanta, GA 30339-3769
No insurance required to be maintained pursuant to this Agreement shall
be canceled without giving at least ten (10) days prior written notification to
the other party.
INDEMNIFICATION. Both parties agrees to indemnify and save harmless the other
party from any liabilities, lawsuits, penalties, claims, or demands (including
the costs, expenses, and reasonable attorneys fees on account thereof) that may
be made: (1) by any third party for injuries, including death, to persons or
damage to property, including theft, resulting from either Company's or
Cellemetry's negligent or willful acts or omissions or those of persons
furnished by Company or Cellemetry, its agents or subcontractors; or (2) by any
employee or former employee of either party or any of its subcontractors for
which Company's or Cellemetry's or subcontractor's liability to such employee or
former employee would otherwise be subject to payments under the state Worker's
Compensation or similar laws. Both parties agree to defend the other party, at
that party's request, against any such liability, claim, or demand. Both parties
agree to notify the other party promptly of any written claims or demands
against that party for which Company or Cellemetry is responsible hereunder.
RELATIONSHIP. Neither Company nor its subcontractors, nor the employees or
agents of any of them, shall be deemed to be Cellemetry's employees or agents,
it being understood that Company and its subcontractors are independent
contractors for all purposes and at all times, and Company and its
subcontractors shall be wholly responsible for withholding or payment of all
Federal, State, and local income and other payroll taxes with respect to their
employees, including contributions from them as required by law.
ARBITRATION. Any disputes arising hereunder with respect to the fulfillment or
interpretation of any terms or conditions hereof shall be settled by an amicable
effort by the parties.
Either party may request that any such dispute which is not amicably
settled by such efforts of the parties shall be submitted to voluntary binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), as modified herein.
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<PAGE> 11
Either party may initiate arbitration by filing a demand at the
regional office of the AAA closest to Cellemetry's offices. Disputes will be
heard and determined by a panel of three arbitrators. Each party will appoint
one arbitrator to serve on the panel, and the AAA will appoint one neutral
arbitrator. Neither party will communicate separately with any arbitrator. All
communications between a party and an arbitrator will be directed to the AAA for
transmittal to the arbitrator.
Either party may petition the court in the state in which the
arbitration was held to confirm, correct, or vacate the award on the grounds
stated in the Federal Arbitration Act. Nothing in this paragraph will prevent
either party from seeking injunctive relief against the other party (and its
employees or agents) from any judicial or administrative authority pending the
resolution of a dispute or controversy by arbitration. The arbitrators shall
also decide on the liability for costs including the reimbursement of reasonable
attorneys' fees.
CHOICE OF LAW. This Agreement shall be construed in accordance with the law of
the State of Georgia without regard to its choice of law provisions.
SEVERABILITY. In the event that any one or more of the provisions contained
herein shall for any reason be held to be unenforceable in any respect under the
laws of the jurisdiction governing the entire Agreement, the Agreement shall
then be construed as if such unenforceable provision or provisions had never
been contained herein.
RELEASES VOID. Neither party shall require waivers or releases of any personal
rights from representatives or customers of the other in connection with visits
to its premises and both parties agree that no such releases or waivers shall be
pleaded by them or by third persons in any action or proceeding.
GIFTS AND GRATUITIES. The exchange or offering of any gift item, personal
service, unusual entertainment or hospitality by either party of this Agreement
to the other party is expressly prohibited. This prohibition is equally
applicable to either party's officers, employees, agents or immediate family
members. Any violation of this tenet constitutes cause for immediate
cancellation of this Agreement.
FORCE MAJEURE. Neither party shall be liable to the other for failure or
inability to perform its obligations hereunder to the extent that such failure
or inability is due to force majeure. For the purposes of this Agreement, "force
majeure" shall mean causes beyond the reasonable control of the party, including
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but not limited to acts of God, acts of the public enemy, fires, floods, acts of
any government, strikes, embargoes, unusually severe weather conditions, or
inability to obtain necessary raw materials. In the event of any such situation,
the party shall be given a reasonable period of time in which to complete its
obligations, during which the other party's payment obligations shall be
suspended. Should the condition continue for a period of six (6) months, then
the other party shall have the right to terminate this Agreement without
liability to the other party except as to rights accrued as of the date of
termination.
ASSIGNMENT. Except upon change of control of either party, neither party may
assign this Agreement without the prior written consent of the other party,
which consent shall not be unreasonably withheld.
SECTION HEADINGS. The headings of the several Sections are inserted for
convenience of reference only and are not intended to be a part of, or to affect
the meaning or interpretation of, this Agreement.
ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
Cellemetry and Company with respect to the subject matter hereof and shall not
be amended or modified without specific written provision to that effect, signed
by both parties. No oral statement of any person whomsoever shall, in any manner
or degree, modify or otherwise affect the terms and provisions of this
Agreement.
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Cellemetry LLC HighwayMaster Corporation
By: (x)Gordon T. Ray By: (x) Jana Bell 1/11/99
---------------------- ------------------------
Title: President Title: President & CEO
------------------- ---------------------
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APPENDIX 1
TOTAL CELLEMETRY COVERAGE AREA
[MAP]
<PAGE> 15
Appendix 2
Payment
[Text has been omitted pursuant to a request for confidential treatment. The
omitted material has been filed separately with the SEC.]
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Appendix 3
TRADEMARK LICENSE AGREEMENT
This Agreement is made by and between Cellemetry LLC ("Licensor"), and
Company ("Licensee").
WHEREAS, the "CELLEMETRY" mark and logo are registered trademarks of
Cellemetry Corporation ("Cellemetry"); and
WHEREAS, Licensee desires to use the "CELLEMETRY" mark in word and
logotype form (the "Mark") in connection with its provision of applications,
which consist of software programs that provide telemetry features, such as
remote meter reading, alarm monitoring, and similar functions, ("Applications")
and associated equipment, which consists of radios and devices connecting the
radios to monitoring, alarm, or similar equipment at a cellular customer's
location, ("Equipment") to facilitate the use by the cellular customer ("End
User") of Cellemetry telemetry messaging services provided by a cellular carrier
which licenses the CELLEMETRY mark and related technology from Licensor (a
"Carrier") in accordance with the terms of the agreement to which this Agreement
is attached;
WHEREAS, Cellemetry will obtain a benefit in consideration of the
advertising from Licensee's marketing using the "CELLEMETRY" mark to designate
the service with which the Applications and the Equipment are compatible; and
WHEREAS, Cellemetry has authorized Licensor to sublicense the Mark to
Licensee pursuant to the terms hereof;
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, the parties hereby agree as follows:
I. PURPOSE
Licensee proposes to engage in the business of developing and providing
certain Applications and Equipment for use by End Users to enable Carriers to
provide telemetry messaging services to such End Users using Cellemetry(R) Data
Service within the geographic territory comprising the Cellular Service Area(s)
of
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the applicable Carrier (the "Territory"). Licensee desires to use the Mark in
connection with the provision of Applications and Equipment to End Users (the
"Business") in the Territory to denote compatibility of the Applications and
Equipment with Cellemetry(R) Data Service. Licensor is willing to permit
Licensee to use the Mark in connection therewith on the terms and conditions set
forth herein.
II. LICENSE
Licensor grants to Licensee, upon the terms and conditions of this
Agreement, the non-exclusive right, license, and privilege to use the Mark only
in the Territory and only to promote the Applications in marketing material,
advertising, and publicity and on the Equipment that it provides in connection
therewith to denote the compatibility of the Equipment with Cellemetry(R) Data
Service. No license is granted herein with respect to the use of the Mark as a
trademark on the Applications or the Equipment or with respect to any other mark
owned or used by Licensor or Cellemetry, including, but not limited to,
CELLEMETRY or the Bell Symbol logo.
III. TERM
Except as otherwise provided in this Agreement, the term of this
Agreement is co-extensive with the agreement to which it is attached, and it
shall expire or terminate on the same date as that agreement.
IV. DUTIES OF LICENSOR
All duties of Licensor under this Agreement are to Licensee, and no
other party except Cellemetry, the owner of the Marks, is entitled to rely on,
enforce, or obtain relief for breach of any such obligation, either directly or
by subrogation. Licensor shall undertake the following duties:
A. Trademark Usage Guidelines
Licensor will provide Licensee with written and graphic
guidelines for the correct reproduction, application, and presentation of the
Mark, which may include Mark specimens, samples of advertisements, and clip art
indicating color, proportion, and format.
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V. DUTIES OF LICENSEE
Licensee understands and acknowledges that the proper usage of the Mark
and the use of the Mark in association with a high quality of goods and service
is important to Licensee, Licensor, Cellemetry, and other licensees of the Mark
in order to protect the reputation of, and goodwill associated with, the Mark.
Toward that end, Licensee acknowledges and accepts the following duties:
A. Quality of Service
Licensee agrees to provide high quality Applications for use with
Cellemetry(R) Data Service. In no event shall Licensee market any Applications
that have not been submitted to Licensor for approval pursuant to the Licensor's
certification program and approved by Licensor.
B. Quality of Goods
Licensee shall construct the Equipment in full compliance with
all guidelines and specifications promulgated by the Federal Communications
Commission and any state regulatory commission, and to the highest standards
applicable in the industry. To the extent that it is applicable, Licensee shall
apply for and obtain certification by the Underwriters Laboratories for the
Equipment.
C. Use of Mark
Licensee shall apply the Mark only in accordance with the
provisions of Sections VII and VIII hereof.
D. Inspection
Licensor shall have the right at any time to conduct during
regular business hours an examination of any services or Applications provided
and materials or Equipment produced by or for Licensee on or with which the Mark
is used at Licensee's facilities to determine compliance of such services,
Applications, materials, and Equipment with the requirements of this Agreement,
the trademark usage guidelines, and the applicable standards set forth in
Section V.B. hereof (the "Standards"). Licensee shall furnish such samples as
Licensor may request for examination. If at any time such services,
Applications, materials, or Equipment shall, in the sole opinion of Licensor,
fail to conform with those Standards, Licensor or its authorized representative
shall so notify Licensee. Upon such notification Licensee shall promptly cease
to use the Mark on or with such
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services, Applications, materials, and Equipment and shall not use such
services, Applications, materials, and Equipment for any purpose until the
Standards have been met to the satisfaction of Licensor.
E. Legal Compliance
Licensee agrees to comply, at its own expense, with all
applicable laws, ordinances, and regulations of federal, state, county, or
municipal authorities. Licensee agrees to notify Licensor in writing within five
(5) days of the commencement of any action, suit, or proceeding, and of the
issuance of any order, writ, injunction, award, or decree of any court, agency,
or other governmental instrumentality, which could have a material adverse
effect on Licensee's ability to engage in the Business.
F. Business Practices
Licensee shall not engage in any trade practice or other
activity which is harmful to the goodwill or reflects unfavorably on the Mark or
on the reputation of Licensee or Licensor or which constitutes deceptive or
unfair competition, consumer fraud, or misrepresentation.
VI. FEES AND REPORTING
A. Initial Fee
[Text has been omitted pursuant to a request for confidential
treatment. The omitted material has been filed separately with the SEC.]
VII. MARK
A. Licensor acknowledges and agrees to the following: (i)
Cellemetry is the owner of all right, title, and interest in and to the Mark,
and (ii) Licensor is a wholly-owned indirect subsidiary of Cellemetry, and
Cellemetry controls the manner of use of the Mark under the related company
doctrine of federal trademark law and, accordingly, Licensor has been authorized
by Cellemetry to enter into this Agreement.
B. With respect to Licensee's use of the Mark pursuant to this
Agreement, Licensee acknowledges and agrees to the following:
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1. Licensee shall use only the Mark designated by Licensor and
shall use it only in the manner authorized and permitted by Licensor, and only
in accordance with the written and graphic guidelines provided for the correct
reproduction, application and presentation of the Mark.
2. Licensee shall use the Mark only in connection with the
conduct of the Business in the Territory.
3. Licensee shall identify Cellemetry as the owner of the Mark
in conjunction with all uses of the Mark and shall place such notices on the
Mark as are prescribed by Cellemetry.
4. Licensee shall have no right to sublicense the Mark to any
other person or entity.
5. Licensee's right to use the Mark is limited to the uses
authorized under this Agreement, and any unauthorized use constitutes an
infringement of Licensor's and Cellemetry's rights.
6. Licensee shall not use the Mark as part of its legal name
or its commercial trade name or in conjunction with any services provided by
Licensee except as provided herein.
7. Licensor and its subsidiaries make no warranties regarding
ownership of any rights in or the validity of said Mark.
8. Licensor shall have the sole authority to conduct the
defense at Licensor's expense of any suit brought against Licensee claiming that
the Mark infringes the trademark or trade name rights of a third party and to
settle any such claim or suit. Licensor shall have the sole right to engage in
infringement or unfair competition proceedings involving the Mark. Licensee
shall promptly notify Licensor of the particulars of any suit or claim brought
against Licensee based on its use of the Mark and of any suspected infringement
of or challenge to the validity, registration, or Licensor's ownership of the
Mark which occurs in the Territory, or elsewhere, should the Licensee become
aware. Licensor may, in its sole discretion, institute or defend proceedings as
it shall deem fit. If Licensor or Cellemetry undertake the prosecution or
defense of any litigation relating to the Mark, Licensee agrees to execute any
and all documents and to do whatever acts and things as may, in the opinion of
counsel for Licensor or Cellemetry, be necessary or advisable to carry out the
prosecution or defense, at Licensor's
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expense. If, in Licensor's or Cellemetry's sole judgment, any claim or suit for
infringement brought by a third party can be avoided or resolved by the
discontinuation of the use of the Mark by Licensee, Licensor shall so notify
Licensee and Licensee shall discontinue all use of the Mark pursuant to Article
XII hereof. Licensor's or Cellemetry's liability for damages to Licensee for any
loss of the use of the Mark (including any loss resulting from Cellemetry's loss
of title or ownership of the Mark or the rights thereto whether by judgment,
settlement, or otherwise) shall be limited to the sum of [Text has been omitted
pursuant to a request for confidential treatment. The omitted material has been
filed separately with the SEC.] THE FOREGOING SETS FORTH THE ENTIRE OBLIGATION
AND LIABILITY OF LICENSOR AND CELLEMETRY FOR BREACH OF SECTION VII(A) AND FOR
INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS.
9. Licensee acknowledges and agrees that the Mark is valid.
Licensee shall not directly or indirectly contest the validity, registration, or
Cellemetry's ownership of the Mark.
10. Licensee's use of the Mark pursuant to this Agreement does
not give Licensee any ownership interest or other interest in or to the Mark,
except the license granted in this Agreement. Any and all goodwill arising from
Licensee's use of the Mark shall inure solely and exclusively to the benefit of
Cellemetry, and upon expiration or termination of this Agreement and the license
granted by it, no monetary amount shall be assigned as attributable to any
goodwill associated with Licensee's use of the Mark.
11. Licensor and Cellemetry have and retain the following
rights, among others:
(a) The right to use the Mark itself, as a corporate or
trade name, in connection with regional and national advertising, and with
selling products and services, both within and outside the Territory;
(b) The right to grant licenses for use of the Mark in
addition to those licenses already granted to existing licensees of the Mark;
and
(c) The right to use the Mark in any manner whatsoever in
Cellemetry's sole discretion.
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12. In the event that the Mark, including any design logos
adopted after execution of this Agreement which shall be used with the Mark,
can, in Licensor's sole opinion, no longer be used, Licensor reserves the right
to provide a substitute mark or design.
VIII. ADVERTISING
Recognizing the value of advertising and the importance of advertising
in establishing and maintaining the goodwill and public image of the Mark, the
parties agree as follows:
A. Licensee's Advertising
All advertising and promotion by Licensee in any manner or
medium must be conducted in a dignified manner and must conform to the written
and graphic guidelines specified by Licensor. Licensee shall display the Mark in
the manner prescribed by Licensor on all signs and all other advertising and
promotional materials used in connection with Licensee's provision of the
Applications and Equipment. If requested by Licensor, Licensee at its own
expense shall promptly provide to Licensor photocopies of all print
advertisements and promotional materials and audio/video cassettes of
radio/television advertising using the Mark. Licensee shall immediately
discontinue any use of the Mark which is inconsistent with the terms hereof on
written notice from Licensor. If Licensee mentions cellular or wireless
capabilities or remote monitoring capabilities of its Applications or Equipment
in its advertising without using the Mark in such advertising, Licensee shall
give credit to Licensor in the advertising as the owner and provider of the
technology on which the Applications or Equipment operate.
B. Materials Provided by Licensor
Licensor may provide from time to time, in its sole
discretion, advertising and promotional plans and materials, including, without
limitation, newspaper mats, television and radio tapes, promotional brochures,
and sales aids. Licensee may use all or any of these materials in its sole
discretion.
IX. CONFIDENTIALITY OF INFORMATION AND USE RESTRICTION
Any technical information furnished to Licensee under this Agreement
shall remain the property of Licensor and shall be returned to Licensor upon
request.
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Unless such information was previously known to Licensee free of any
obligation to keep it confidential or has been or is subsequently made public by
Licensor, it shall be held in confidence and shall be used only for the purposes
of this Agreement.
X. EXPORT
Licensee hereby assures Licensor that it does not intend to and will
not knowingly, without the prior written consent of Licensor, conduct the
Business outside of the Territory. In the event that Licensor consents to any
such transaction, Licensee agrees to comply with all applicable United States
export control laws and regulations as they currently exist and as they may be
amended.
XI. TRANSFER OF INTEREST
A. Transfer by Licensor
Licensor shall have the right to transfer or assign all or any
part of its rights or obligations herein to any person or legal entity. If
Licensor's assignee assumes all of the obligations of Licensor under this
Agreement and sends written notice of the assignment so attesting, Licensee
shall promptly execute a general release of Licensor, and any subsidiaries,
partners, and Affiliates of Licensor, from claims against or liabilities of
Licensor or such subsidiaries, partners, or Affiliates of Licensor to the extent
that they arise under this Agreement.
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B. Transfer by Licensee
Licensee may not assign or transfer any of its rights under
this Agreement.
XII. DEFAULT AND TERMINATION
A. Termination by Licensor -- Without Notice
Licensee shall be deemed to be in default under this
Agreement, and all rights granted herein shall automatically terminate without
notice to Licensee, if Licensee becomes insolvent or makes a general assignment
for the benefit of creditors; or if a petition in bankruptcy is filed by
Licensee or against Licensee and not opposed by Licensee within sixty (60) days
of such filing; or if Licensee is adjudicated as bankrupt or insolvent; or if a
bill in equity or other proceeding for the appointment of a receiver of Licensee
or other custodian for Licensee's business or assets if filed and consented to
by Licensee; or if a receiver or other permanent or temporary custodian of
Licensee's assets or property, or any part thereof, is appointed by any court of
competent jurisdiction; or if proceedings for a composition with creditors under
any state or federal law should be instituted by or against Licensee; or if a
material final judgment remains unsatisfied or of record for thirty (30) days or
longer (unless supersedeas bond is filed); or if Licensee is dissolved; or if a
suit to foreclose any lien or mortgage against real or personal property used in
the operation of Licensee's business, the loss of which would have a material
adverse effect on Licensee, is instituted against Licensee and not dismissed
within thirty (30) days; or if execution is levied against Licensee's business
or property, the loss of which would have a material adverse effect on Licensee;
or if real or personal property of Licensee used in its business, the loss of
which would have a material adverse effect on Licensee, shall be sold after levy
thereupon by any sheriff, marshal, or constable; or if Licensee at any time
ceases to operate or otherwise abandons its business or otherwise forfeits the
right to do or transact business in any market(s) in the Territory; or if
Licensee loses any government license required to engage in the Business or
otherwise forfeits the right to do or transact business in one or more
market(s), in which event Licensee's rights under this Agreement shall
automatically terminate.
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B. Termination by Licensor - Upon Notice
Upon the occurrence of any of the following events, Licensee
shall be deemed to be in default and Licensor may, at its option, terminate this
Agreement and all rights granted hereunder without affording Licensee any
opportunity to cure the default. Said termination shall be effective immediately
upon receipt of notice by Licensee:
1. If any officer of Licensee is convicted of a felony, a
fraud, or any other crime or offense that Licensor believes is reasonably likely
to have a material adverse effect on the Mark, the goodwill associated
therewith, or Licensor's interest therein;
2. If a material threat or danger to public health or safety
results from the conduct of the Business;
3. If Licensee purports to transfer any rights or obligations
under this Agreement to any third party, contrary to the terms of this
Agreement;
4. If the Licensee contests in any court or proceeding the
validity or registration of, or Licensor's or Cellemetry's ownership of, the
Mark or other rights licensed hereunder; or
5. If Licensee fails to maintain the information furnished
hereunder in confidence or fails to restrict the transmission of information as
required herein by this Agreement.
C. Termination By Licensor - After Notice and Opportunity to Cure
Except as provided in the foregoing paragraphs and of this
Section, Licensee shall have sixty (60) days after its receipt from Licensor of
a written notice of termination within which to remedy any default hereunder
(or, if the default cannot reasonably be cured within such sixty (60) days, to
initiate within that time substantial and continuing action to cure the
default), and to provide evidence thereof to Licensor. If any such default is
not cured within that time (or, if appropriate, substantial and continuing
action to cure the default is not initiated within that time), or such longer
period as applicable law may require, this Agreement shall terminate without
further notice to Licensee effective immediately upon expiration of the sixty
(60) day period or such longer period as applicable law may require. Licensee
shall be in default hereunder for any failure
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to comply substantially with any of the requirements imposed by this Agreement
or to carry out the terms of this Agreement in good faith. Such defaults shall
include, without limitation, the occurrence of any of the following events:
1. If Licensee fails, refuses or neglects promptly to submit
information as required under this Agreement, or makes any material false
statements in connection therewith;
2. If Licensee fails to comply, in any material respect, with
the standards for use of the Mark provided by Licensor;
3. If Licensee misuses or makes any unauthorized use of the
Mark or otherwise materially impairs the goodwill associated therewith or
Licensor's rights therein;
4. If Licensee engages in any business or markets any goods or
services under a name or mark which, in Licensor's opinion, is confusingly
similar to the Mark;
5. If Licensee, by act or omission, permits a continued
material violation in connection with the Business of any law, ordinance, rule,
or regulation of a governmental agency, in the absence of a good faith dispute
over its application or legality and without promptly resorting to an
appropriate administrative or judicial forum for relief therefrom;
6. If Licensee fails to make any payment specified herein; or
7. If Licensee refuses or neglects a request by Licensor for
sample marketing materials, advertising copy, stationery, or other materials, or
access to the premises of Licensee.
XIII. OBLIGATIONS UPON TERMINATION OR EXPIRATION
Upon termination or expiration of this Agreement, all rights granted
hereunder shall forthwith terminate, and:
A. Identification
1. Licensee shall immediately cease to hold itself out as a
present or former Licensee of Licensor.
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2. Licensee shall immediately and permanently cease to use, in
any manner whatsoever, the Mark; and all other marks and distinctive forms,
slogans, signs, symbols, monograms, and devices associated with the Mark; in
particular, Licensee shall cease to use, without limitation, all signs,
advertising materials, displays, stationery, and forms which display the Mark.
3. Licensee agrees not to use any reproduction, counterfeit,
copy, or colorable imitation of the Mark which is likely to cause confusion,
mistake, or deception, or which is likely to dilute Licensor's or Cellemetry's
rights in and to the Mark. Further, Licensee agrees not to utilize any
designation of origin or description or representation which falsely suggests or
represents an association or connection with Licensor or the Mark.
B. Payments of Monies Due
Licensee shall pay to Licensor all damages, costs, and
expenses, including reasonable attorney's fees, incurred by Licensor subsequent
to the termination or expiration of this Agreement in obtaining injunctive or
other relief for the enforcement of any provisions of this Article XIII.
XIV. INDEPENDENT STATUS AND INDEMNIFICATION
A. It is understood and agreed by the parties hereto that this
Agreement does not create a fiduciary relationship between them; that Licensee
shall remain an independent business; and that nothing in this Agreement is
intended to constitute either party as an agent, legal representative,
subsidiary, joint venturer, partner, employee, or servant of the other for any
purpose whatsoever.
B. During the term of this Agreement and any renewal hereof,
Licensee shall hold itself out to the public as an independent business using
the Mark pursuant to a license from Licensor. Licensee agrees to take such
action as may be necessary to so notify the public.
C. It is understood and agreed that nothing in this Agreement
authorizes Licensee to make any contract, agreement, warranty or representation
on Licensor's behalf, or to incur any debt or other obligation in Licensor's
name. Licensor shall in no event assume liability for, or be deemed liable
hereunder as a result of, any such action; nor shall Licensor be liable by
reason of this Agreement for any act or omission of Licensee in its conduct of
its business or for any claim or judgment arising therefrom against Licensee,
Cellemetry or Licensor. Licensee
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shall indemnify and hold Cellemetry and its Affiliates and their respective
officers, directors, employees, and stockholders harmless from and against (1)
any and all claims, whether for personal injury or otherwise, arising directly
or indirectly from, as a result of, or in connection with, the conduct of this
Business in which the Mark is used, as well as the costs, including attorney's
fees, of defending against them, and (2) damages due to any improper or
unauthorized use of the Mark.
D. In no event shall either party be liable to the other for any
incidental or consequential damages, whether foreseeable or not, arising from
any breach of the other party's obligations under this Agreement.
XV. APPROVALS AND WAIVERS
A. Whenever this Agreement requires the prior approval or consent
of Licensor, Licensee shall make a written request to Licensor therefor at least
five business days prior to the date by which Licensee needs Licensor's consent,
and such approval or consent shall be obtained in writing.
B. Licensor and Cellemetry make no warranties or guarantees upon
which Licensee may rely, and assume no liability or obligation to Licensee, by
providing any waiver, approval, consent, or suggestion to Licensee in connection
with this Agreement, or by reason of any neglect, delay or, denial of any
request therefor.
C. No failure of Licensor to exercise any power reserved to it in
this Agreement, or to insist upon compliance by Licensee with any obligation or
condition in this Agreement, and no custom or practice of the parties at
variance with the terms hereof, shall constitute a waiver of Licensor's rights
to demand exact compliance with any of the terms of this Agreement. Waiver by
Licensor of any particular default shall not affect or impair Licensor's right
with respect to any subsequent default of the same or of a different nature; nor
shall any delay, forbearance or omission by Licensor to exercise any power or
right arising out of any breach or default by Licensee of any of the terms,
provisions, or covenants of this Agreement affect or impair Licensor's rights;
nor shall such constitute a waiver by Licensor of any rights hereunder or rights
to declare any subsequent breach or default.
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D. Subsequent acceptance by Licensor of any payments due to it
shall not be deemed to be a waiver by Licensor of any preceding breach by
Licensee of any terms, covenants, or conditions of this Agreement.
XVI. NOTICES
Any and all notices required or permitted under this Agreement shall be
in writing and shall be personally delivered or mailed by certified or
registered mail, return receipt requested, to the respective parties at the
addresses set forth in the Agreement to which this Agreement is attached.
Any notice by certified or registered mail shall be deemed to have been
given at the date and time of receipt.
XVII. ENTIRE AGREEMENT
This Agreement, the documents referred to herein, and the attachments
hereto constitute the entire, full and complete agreement between Licensor and
Licensee concerning the subject matter hereof, and supersede all prior
agreements. Without limiting the foregoing, this Agreement shall be deemed to
amend and restate in its entirety and to supersede, for all purposes, any prior
agreement between the parties hereto which contemplates or has as its primary
purpose the grant of a license to use the Mark. Except for those permitted to be
made unilaterally by Licensor hereunder, no amendment, change or variance from
this Agreement shall be binding on either party unless mutually agreed to by the
parties and executed by their authorized officers or agents in writing.
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XVIII. SEVERABILITY AND CONSTRUCTION
A. Except as expressly provided to the contrary herein, each
portion, section, part, term, and/or provision of this Agreement shall be
considered severable; and if, for any reason, a portion, section, part, term,
and/or provision herein is determined to be invalid and contrary to, or in
conflict with, any existing or future law or regulation by a court or agency
having valid jurisdiction, such shall not impair the operation of, or have any
other effect upon, such other portions, sections, parts, terms, and/or
provisions of this Agreement as may remain otherwise intelligible; and the
latter shall continue to be given full force and effect and bind the parties
hereof; and said invalid portions, sections, parts, and/or provisions shall be
deemed not to be a part of this Agreement.
B. Nothing in this Agreement is intended, nor shall be deemed, to
confer any rights or remedies upon any person or legal entity other than
Licensor, Cellemetry, or Licensee, and their respective successors and assigns
as permitted by this Agreement.
C. In the event a court in a final decision rules that any
provision of this Agreement or portion thereof is unenforceable, Licensee agrees
to be bound by the maximum duty ruled enforceable by the court.
D. All captions in this Agreement are intended solely for the
convenience of the parties, and none shall be deemed to affect the meaning or
construction of any provision hereof.
E. All references herein to the masculine, neuter, or singular
shall be construed to include the masculine, feminine, neuter, or plural, where
applicable; and all acknowledgments, promises, covenants, agreements, and
obligations herein made or undertaken by Licensee shall be deemed jointly and
severally undertaken by all those executing this Agreement on behalf of
Licensee.
XIX. APPLICABLE LAW
A. THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED UNDER THE
LAWS OF THE STATE OF GEORGIA, WITHOUT REGARD TO ITS CONFLICTS OF LAWS
PROVISIONS.
B. No right or remedy conferred upon or reserved to Licensor or
Licensee by this Agreement is intended to be, nor shall be deemed, exclusive of
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any other right or remedy herein or by law or equity provided or permitted, but
each shall be cumulative of every other right or remedy.
C. Nothing herein contained shall bar Licensor's or Cellemetry's
right to apply for injunctive relief against threatened conduct that will cause
it loss or damages, under applicable equity rules, including the applicable
rules for obtaining restraining orders and preliminary injunctions.
XX. ACKNOWLEDGMENTS
Licensor expressly disclaims the making of, and Licensee acknowledges
that it has not received, any warranty or guarantee, express or implied, as to
the potential volume, profits, or success resulting from the utilization of the
Mark by Licensee.
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EXHIBIT A
Trademark Licensee Agreement
List of Marks
The Mark currently designated by the Licensor for use hereunder is as
follows:
<TABLE>
<CAPTION>
Mark Date of Registration Registration Number
---- -------------------- -------------------
<S> <C> <C>
CELLEMETRY 10/01/96 Reg. No. 2,004,693
</TABLE>
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Appendix 4
NONDISCLOSURE AGREEMENT
1. Project Defined. Each party may receive from the other party
information of a non-public nature for use by such party and its officers,
directors, agents, employees and representatives, including financial and legal
advisers (collectively "Representatives"), in the course of the performance of
the Agreement to which this Nondisclosure Agreement is attached.
2. Information Defined. Each party acknowledges that, in the course of
its performance under the Agreement, it will receive certain private and
proprietary information from or about the other party or its affiliates,
including but not limited to the terms of the Agreement to which this
Nondisclosure Agreement is attached, technical, financial or business
information and models, names of customers or partners, proposed business deals,
reports, plans, market projections, software programs, data or any other private
and proprietary information relating to the Agreement which may include certain
trade secrets ("Information"). The term "Information" as used herein also
includes: (i) the fact that the Information has been made available to or is
being inspected or evaluated by such party; and (ii) any information, work
papers, analyses, compilations, projections, studies, documents, terms,
conditions, correspondence, facts or other materials derived or produced by such
party or its representatives for the other party in connection with the
Agreement. Any Information supplied by a party to the other party prior to the
execution of this Agreement shall be subject to the same treatment as the
Information made available after the execution of this Agreement.
3. Exclusions from Definition. The term "Information" as used herein
does not include any data or information that: (a) is already known to a party
at the time it is disclosed to such party; or (b) before being divulged by such
party: (i) has become generally known to the public through no wrongful act of
such party or its representatives; (ii) has been rightfully received by such
party from a third party without restriction on disclosure and without a breach
of an obligation of confidentiality running directly or indirectly to the other
party; (iii) has been approved for release by a written authorization by the
other party; or (iv) is independently developed by such party without use,
directly or indirectly, of the Information received from the other party.
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4. Nondisclosure Obligation. Each party shall keep the Information
confidential and shall not disclose such Information, in whole or in part, to
any person other than its Representatives who need to know such Information in
connection with such party's performance under the Agreement except with the
prior written consent of the other party or as otherwise permitted hereunder.
Such Representatives shall be informed by the party of the confidential nature
of the Information and shall be required by the party to agree in writing to be
bound by this Agreement. The Information shall be used by the party solely for
the purpose of performing under the Agreement, and shall not be otherwise used
for that party's own benefit or for any purpose detrimental to the interests of
the other party.
5. Standard of Protection. For the purpose of complying with the
obligations set forth herein, each party shall use efforts commensurate with
those that it employs for the protection of corresponding sensitive information
of its own, which shall in any event be no lesser a standard than the type of
efforts that would be taken by a reasonable business for the protection of its
own highly confidential information and trade secrets.
6. Compliance with Legal Process. In the event that either party is
legally requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, Civil Investigative Demand or similar
process or, in the opinion of counsel for such party, by federal or state
securities or other statutes, regulations or laws) to disclose any Information,
such party shall promptly notify the other party of such request or requirement
prior to disclosure so that the other party may seek an appropriate protective
order and/or waive compliance with the terms of this Agreement.
7. Ownership; Return of Information. All Information (including
tangible copies and computerized or electronic versions and summaries thereof)
shall remain the property of the party to which it belongs. Within ten (10) days
following the receipt of a written request from a party, the other party shall
deliver to the first party all tangible materials containing or embodying the
Information received from the other party, together with a certificate executed
by an officer of such party certifying that all such materials in such party's
possession or control have been delivered to the other party or destroyed.
Neither party shall assert directly or indirectly any right with respect to the
Information which may impair or be adverse to the other party's ownership
thereof.
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8. Remedies for Breach. Each party understands and agrees that money
damages would not be a sufficient remedy for any breach of this Agreement and
that the other party shall be entitled to seek injunctive or other equitable
relief to remedy or forestall any such breach or threatened breach. Such remedy
shall not be deemed to be the exclusive remedy for any breach of this Agreement,
but shall be in addition to all other rights and remedies available at law or in
equity.
9. No Representations or Further Obligations. Neither this Agreement
nor the disclosure of Information shall constitute or imply any promise or
intention to make any purchase of services by either party. None of the
Information which may be disclosed by either party shall constitute any
representation, warranty, assurance, guarantee or inducement by that company to
the other company of any kind, and in particular, with respect to the accuracy
or completeness of any Information or the non-infringement of trademarks,
patents, copyrights, mask protection rights or any other intellectual property
rights, or other rights of third persons. It is understood that this Agreement
does not obligate either party to enter into any further agreements or to
proceed with any possible relationship or other transaction.
10. Term; Termination. This Agreement shall terminate as to the
exchange of any new Information three (3) years after the effective date hereof.
Either party may terminate the exchange of Information under this Agreement at
any time by written notice to the other specifically referencing this Agreement.
In any event, however, the obligations of each company to maintain the
confidentiality of the Information it has received under this Agreement shall
continue for a period of three (3) years after such termination and then
terminate; provided, however, that such obligation shall continue indefinitely
as to Information constituting a trade secret under applicable law for so long
as such Information remains a trade secret.
11. No Waiver. No failure or delay by either party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder.
12. Amendment. This Agreement may not be modified, supplemented or
amended orally, but only by a writing signed by both parties hereto.
13. Applicability to Associated Parties. Any information disclosed to
Company by any of Cellemetry's affiliated companies or by any company, person
34
<PAGE> 36
or other entity participating with Cellemetry in any consortium, partnership,
joint venture or similar business combination in connection with the Agreement,
which would otherwise constitute Information hereunder if disclosed by
Cellemetry, shall be deemed to constitute Information under this Agreement, and
the rights of Cellemetry under this Agreement may be enforced by any such
affiliate or other entity in addition to Cellemetry with respect to any
violation relating to the Information disclosed by such affiliate or other
entity, as if such entity were also a party to this Agreement.
35
<PAGE> 1
Exhibit 11
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1999 1998
------------ -------------
<S> <C> <C>
Net income (loss) applicable to common stockholders:
Net income (loss) $ 390,000 $(11,589,000)
============ ============
Weighted average number of shares outstanding:
Weighted average number of shares outstanding, net of treasury shares -
Basic EPS 24,933,261 24,898,986
Additional weighted average shares for assumed exercise of stock options,
net of shares assumed to be repurchased with exercise proceeds 510,957 --
------------ ------------
Weighted average number of shares outstanding, net of treasury shares -
Diluted EPS 25,444,218 24,898,986
============ ============
Net income (loss) per common share applicable to common stockholders:
Basic EPS $ 0.02 $ (0.47)
============ ============
Diluted EPS $ 0.02 $ (0.47)
============ ============
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 15,810
<SECURITIES> 7,251
<RECEIVABLES> 23,967
<ALLOWANCES> 9,442
<INVENTORY> 14,536
<CURRENT-ASSETS> 74,100
<PP&E> 32,858
<DEPRECIATION> 11,728
<TOTAL-ASSETS> 104,316
<CURRENT-LIABILITIES> 38,840
<BONDS> 91,795
0
0
<COMMON> 253
<OTHER-SE> (26,572)
<TOTAL-LIABILITY-AND-EQUITY> 104,316
<SALES> 4,340
<TOTAL-REVENUES> 17,081
<CGS> 3,144
<TOTAL-COSTS> 6,420
<OTHER-EXPENSES> 8,811
<LOSS-PROVISION> 828
<INTEREST-EXPENSE> 3,342
<INCOME-PRETAX> 390
<INCOME-TAX> 0
<INCOME-CONTINUING> 390
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 390
<EPS-PRIMARY> 0.02
<EPS-DILUTED> 0.02
</TABLE>
