Exhibit 10.36 Contract No. D08E20H44 Between Southwestern Bell Telephone
Company and Technology Service Group, Inc. Dated June 9, 1997.
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Southwestern Bell Telephone Company ("Buyer")
A Missouri Corporation
One Bell Center
St. Louis, Missouri 63101
And
Technology Service Group, Inc. ("Seller")
A Delaware Corporation
20 Mansell Court East - Suite 200
Roswell, Georgia 30076
CONTRACT NO. D08E20H44
June 9, 1997
DATE OF EXECUTION
RESTRICTED - PROPRIETARY INFORMATION
The information contained herein is for use by authorized
employees of the parties hereto only and is not for general
distribution within or outside their respective Companies.
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TABLE OF CONTENTS
PREAMBLE 1
COMMITMENTS OF THE PARTIES 2
AFFILIATED COMPANIES 7
ASSIGNMENT 8
BREACH BY BUYER 8
BREACH BY SELLER 8
CHANGES TO MATERIAL AND CLASSIFICATION THEREOF 9
CHOICE OF LAW 10
COMPLIANCE WITH LAWS 10
CONFLICT OF INTEREST 11
CONTINUING AVIALABILITY OF REPLACEMENT AND REPAIR PARTS 11
CUSTOM SOFTWARE DEVELOPMENT 12
EMERGENCY SUPPORT SERVICE 12
ENGINEERING COMPLAINTS 14
ERROR CORRECTIONS 15
EXECUTION/ENTIRE AGREEMENT 19
F.O.B 19
FORCE MAJEURE 19
FREIGHT CLASSIFICATION 20
HAZARDOUS MATERIALS/REGULATED SUBSTANCES 20
HEADINGS 21
INFANT MORTALITY 21
INFRINGEMENT 21
INSIGNIA 23
INSURANCE 23
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LIABILITY AND INDEMNIFICATION 24
LICENSES 25
MATERIAL/SOFTWARE DOCUMENTATION 25
MODIFICATION TO CONFORM TO LAWS 26
MONTHLY SHIPMENT REPORTS 26
NON-EXCLUSIVE DEALING 26
NON-WAIVER 27
NOTICES 27
PLANT AND WORK RULES 27
PUBLICITY 28
QUALITY ASSURANCE 28
RECORDS AND AUDIT 29
RELEASES VOID 30
RELIABILITY 30
REPAIR SERVICES FOR MATERIAL/SELECTION OF OUTSIDE REPAIR VENDOR 31
RIGHT OF ACCESS 35
SELLER'S INFORMATION 35
SELLER'S LIMITATION ON PAYMENTS TO BUYER 35
SEVERABILITY 35
SHIPMENTS TO BUYER 35
SHIPPING AND BILLING 36
SHIPPING PRIORITY 37
SOFTWARE MAINTENANCE 37
SOFTWARE UPDATES 38
SOURCE CODE REQUIREMENTS 38
SUPPORT OF PREVIOUS VERSIONS OF SOFTWARE 39
SURVIVAL OF OBLIGATIONS 39
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TAXES 39
TECHNICAL SUPPORT FOR COINNET AND MATERIAL 40
TERMINATION 41
TESTING 42
TITLE AND RISK OF LOSS 42
TRAINING 42
USE OF INFORMATION 43
WARRANTY 43
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This contract ("the Contract") by and between Southwestern Bell Telephone
Company ("SWBT" or Buyer"), a Missouri Corporation, with its principal place of
business located at One Bell Center, St. Louis, Missouri, 63101 and Technology
Service Group, Inc. ("TSG" or "Seller"), a Delaware corporation, with its
principal place of business located at 20 Mansell Court East, Suite 200,
Roswell, Georgia 30076, is entered into this 9th day of June, 1997.
PREAMBLE
TSG has previously delivered computer products ("CoinNet") and associated
telephone equipment ("Material") to SWBT. CoinNet presently includes computer
hardware and peripherals, software including Station Message Detail Record
("SMDR") software added to the CoinNet software before the execution of the
Contract (the "pre-existing SMDR software"), and chassis firmware. The Material
includes TSG electronic chassis, including GemStar 4032-GS, upgraded GemStar
4032-GS, GemStar 4032-GSX, and all Gemini chassis (hereinafter referred to
collectively as the "chassis"), CMI-30C electronic locks (hereinafter the
"locks"), CMI 2752-001 electronic keys (hereinafter the "keys"), CMI 2680-001
electronic key controllers (hereinafter the "controllers") and associated power
sources (hereinafter the "adaptors"). TSG agrees to provide additional CoinNet
hardware and peripherals, software, services and Material to SWBT, as specified
herein. TSG agrees that its provision of CoinNet, services and Material
hereunder will be governed by the terms, conditions, covenants, standards,
benchmark measurements, specifications and other requirements as set forth
herein, including Attachments A through G, which are attached hereto and by this
reference made a part hereof.
COMMITMENTS OF THE PARTIES
1. TSG warrants that CoinNet and all Material deployed by SWBT as of 5:00 p.m.
CDT July 2, 1997, which includes the CoinNet computer hardware and
peripherals, software, chassis firmware and Material (including, but not
limited to, four hundred sixty-seven (467) new CMI keys and controllers
delivered to SWBT in April and May 1997) previously provided to SWBT by TSG
and for which SWBT has paid in full, will operate as an integrated system
(the "Integrated System") to provide the features and functionalities, and
perform per the technical standards, benchmark measurements, product
specifications, requirements, processes, procedures and guidelines agreed
upon by the parties herein, including Attachments A through G, and in the
Bellcore and other technical documents referenced in the Contract,
including any said technical documents referenced in said Attachments,
provided that CoinNet is operated by Buyer in accordance with the COINNET
OPERATING GUIDELINES contained in Attachment A. All such technical
standards, benchmark measurements, specifications, requirements, processes,
procedures and guidelines are hereinafter referred to collectively as the
"REQUIREMENTS" and each individually as a "REQUIREMENT".
In the event that any REQUIREMENT contained in Attachment A is inconsistent
or in conflict with any REQUIREMENT contained elsewhere in the Contract, or
in any other Attachment or referenced document, the REQUIREMENT in
Attachment A shall control. Except as to Attachment A, if any REQUIREMENT
in a document incorporated into the
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Contract by reference only (i.e., not physically attached) is inconsistent
or in conflict with any REQUIREMENT contained elsewhere in the Contract,
including in any Attachment or other document incorporated by reference and
physically attached to the Contract, then the REQUIREMENT contained in the
Contract or Attachment so attached, shall control.
In complying with its obligations under the Contract, TSG may employ the
computer hardware and peripherals currently used, or already purchased by
SWBT for use, with the existing CoinNet system.
TSG warrants that, as of 5:00 P.M. CDT on July 2, 1997, the following will
occur:
(a) TSG will provide all Material/Software documentation in compliance with the
MATERIAL/SOFTWARE DOCUMENTATION clause of the Contract and with Attachment
A, Section III. "Documentation," as used in the Contract to refer to
software or firmware documentation, includes without limitation, all
documentation as described in Attachment A, Section III;
(b) TSG must comply with all provisions of the SOURCE CODE REQUIREMENTS clause
of the Contract.
2. After 5:00 P.M. CDT on July 2, 1997, as recertified chassis (as described
in paragraph 3, immediately below) and new GemStar 4032-GSX chassis
purchased hereunder are deployed, the Integrated System will continue to
perform per the REQUIREMENTS. It is understood by TSG that this additional
deployment could result in a total deployment of up to 75,000 TSG
electronic chassis to be supported as part of the Integrated System.
3. TSG will test, repair if necessary, and recertify all chassis purchased
prior to execution of the Contract and never deployed ("warehoused"
chassis) and used chassis, up to a total of 13,000 chassis. "Recertify" as
used in the Contract, means that TSG will test and repair as necessary the
chassis submitted by SWBT for recertification, and certify that such
chassis will perform per the REQUIREMENTS. "Recertification" as used in the
Contract, means the process of recertifying, carried to completion.
TSG will perform the recertification of warehoused and used chassis at SWBT
premises designated by SWBT or at TSG's premises located at 315 Byrd
Street, Orange, Virginia, 22960. TSG may request that warehoused and used
chassis which require testing before recertification be shipped to said TSG
premises. In the event of such a request, said chassis are to be packed (in
a manner equivalent to the packing employed when said chassis were
originally shipped to SWBT) and shipped by SWBT.
SWBT will make its best efforts to ship said warehoused chassis to said TSG
premises on or before June 16, 1997, at SWBT's expense. SWBT will make its
best efforts to ship said used chassis to said TSG premises on or before
July 2, 1997, at SWBT's expense. SWBT will bear the risk of in-transit
damage or loss for shipments to TSG of chassis to be recertified.
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TSG will bear the expense of repairs required to warehoused chassis. TSG
warrants that all recertified warehoused chassis will perform per the
REQUIREMENTS for one (1) year beginning on the date each such chassis is
shipped or otherwise returned to the possession of SWBT by TSG. After
recertification of warehoused chassis shipped to TSG's premises, TSG will
pack and return ship the chassis to the location(s) designated by SWBT in
writing, at TSG's expense. TSG will bear the risk of in-transit damage or
loss of said return shipments to SWBT.
The repair of used chassis still under the original warranty will be at
TSG's expense. If the original warranty has expired, the repair will be at
SWBT's expense, the cost of such repair to be fifty dollars ($50.00) per
chassis. In the event used chassis returned to TSG for testing and
recertification do not require repair, TSG will recertify and warrant said
chassis for a period of one hundred eighty (180) days or the remainder of
the original warranty, whichever is longer. In the event used chassis
returned to TSG for testing and recertification require repair, TSG will
perform said repair and then recertify and warrant said chassis for a
period of ninety (90) days or the remainder of the original warranty,
whichever is longer. After recertification of used chassis shipped to TSG's
premises, TSG will pack and return ship the chassis to the location(s)
designated by SWBT in writing. Such shipments will be at SWBT's expense,
but TSG will bear the risk of in-transit damage or loss as to such
shipments.
Whether the recertification is performed on SWBT's or TSG's premises, upon
recertification, TSG will place a sticker, stamp or other suitable
indication of recertification on each chassis and the outside of each
packing box. Each such indication of recertification must include the
warranty expiration date.
In addition, in the case of GemStar 4032-GS units shipped to TSG for
recertification, upon request by SWBT, TSG will upgrade said GemStar
4032-GS chassis to GemStar 4032-GSX functionality, at SWBT's expense. The
additional cost of each such upgrade to repaired used ("used-repair
required") chassis will be thirty dollars ($30.00). The additional cost of
each such upgrade to used chassis which do not require repair ("used-repair
not required") will be forty dollars ($40.00) per chassis. The warranty
periods for recertified, upgraded chassis, including "warehoused,"
"used-repair not required" and "used-repair required" chassis, will be the
same as the warranty periods for such recertified chassis which are not
upgraded, i.e., one (1) year, one hundred eighty (180) days and ninety (90)
days, respectively.
No later than the date of each shipment of recertified warehoused and used
chassis to SWBT, TSG will provide notice of each such shipment in writing
in accordance with the NOTICES clause of the Contract. In addition, and on
the same date, TSG will send a facsimile copy of said notice to SWBT's
Director-Technology Integration, fax number 210-222-7702. Each such notice
must include, at a minimum, the ship date, the serial number and warranty
expiration date of each chassis included in each such shipment. As to each
such shipment, TSG will also comply with paragraphs (b) through (j) of the
SHIPPING AND BILLING clause of the Contract. Each recertified chassis,
including electronic lock and cash box out switch, if shipped to TSG as a
unit, will be returned to SWBT as a unit, one unit to a box.
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However, TSG will not be responsible for recertifying electronic locks and
cash box out switches.
SWBT or its representative will have the right to audit the recertification
process, whether performed on SWBT premises or TSG premises. If on TSG
premises, SWBT or its representative will be given access to said premises
within twenty-four (24) hours of SWBT's or its representative's oral or
written request.
All warehoused and used TSG chassis returned by SWBT for recertification
which cannot be repaired will be returned to the location(s) designated by
SWBT, within thirty (30) calendar days. Unrepairable warehoused chassis
will be shipped to SWBT at TSG's risk and expense. Unrepairable used
chassis will be shipped to SWBT at SWBT's risk and expense.
TSG will not be required to repair, certify or warrant any warehoused or
used chassis physically damaged through shipment or storage by SWBT.
TSG will return ship recertified warehoused and used chassis to SWBT in
accordance with the schedule in Attachment E, SCHEDULE FOR TSG SHIPMENT OF
RECERTIFIED CHASSIS TO SWBT. TSG will return ship said warehoused and used
chassis by normal commercial transportation calculated to result in
delivery to SWBT of no more than ten (10) calendar days after date of
shipment.
In the event the Contract is terminated pursuant to the TERMINATION clause
or cancelled pursuant to either the BREACH BY BUYER or BREACH BY SELLER
clause, TSG will, within thirty (30) days ship to the location(s)
designated by SWBT all Material owned by SWBT which is in TSG's possession
in its then present condition, whether or not it has been repaired,
upgraded or recertified. Material under warranty will be shipped to SWBT at
TSG's risk and expense. Material out of warranty will be shipped to SWBT at
TSG's risk but at SWBT's expense. TSG agrees that TSG's unauthorized
holding of any such chassis past thirty (30) calendar days will cause
damages to SWBT that will be difficult to determine. Therefore, TSG agrees
to pay SWBT liquidated damages calculated by multiplying the average
monthly revenues of a deployed SWBT payphone divided by thirty (30), by the
number of chassis withheld, times the number of days past thirty (30) that
expire before the chassis are delivered to SWBT's possession. The parties
agree that such sum constitutes a reasonable estimate of SWBT's actual
financial losses.
4. TSG will select and train an out-of-warranty third party repair vendor
acceptable to SWBT, by December 31, 1997, as set forth in the REPAIR
SERVICES FOR MATERIAL clause of the Contract.
5. SWBT will obtain, on or before the date of execution of the Contract, by
contract or employment, a person with a minimum of three (3) years
experience with UNIX-based computer systems, to actively assist TSG during
the time period June 6, 1997 through July 2, 1997, to effect and implement
the REQUIREMENTS applicable to CoinNet. Such person (or his or her
equivalent) will also be made available by SWBT to administer the system
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throughout the life of the Contract or until such time as SWBT ceases to
use CoinNet, whichever comes first. SWBT's agreement to make such person
available in no way relieves or limits TSG's obligations under the Contract
or the REQUIREMENTS. If, at some later point, SWBT replaces said person
with another, the replacement person will also have a minimum of three (3)
years experience with UNIX-based systems. SWBT will make every reasonable
effort to provide a minimum of thirty (30) days overlap between the
original person and any replacement person.
6. TSG will sell and SWBT will purchase an additional 11,000 new GemStar
4032-GSX kits (which will include the chassis, electronic locks and cash
box out switches) in accordance with the following schedule:
November 3, 1997 . . . . . . . . . . . . . . 1,000 kits
December 1, 1997 . . . . . . . . . . . . . . 2,000 "
January 2, 1998 . . . . . . . . . . . . . . .2,500 "
February 2, 1998 . . . . . . . . . . . . . . 2,500 "
March 2, 1998 . . . . . . . . . . . . . . . .3,000 "
Said 11,000 new chassis will be shipped to SWBT at the location(s)
designated by SWBT in writing. Said chassis will be shipped and delivered
in accordance with the SHIPPING AND BILLING clause of the Contract.
The price of each GemStar 4032-GSX chassis will be $266.50, which price
includes the chassis, CMI-30C electronic lock and cash box out switch, all
of which together constitute one kit.
7. In addition to the purchase price of the 11,000 new GemStar 4032-GSX units,
SWBT will make the following payments ("milestone payments") to TSG:
(a) A payment of $250,000.00 will be placed in the overnight mail to TSG
five (5) days after execution of the Contract;
(b) If TSG is in compliance with all of its obligations under the Contract
which it is required to perform as of July 2, 1997, SWBT will place an
additional payment of $250,000.00 in the overnight mail to TSG on that
date;
(c) If TSG has complied with all of its obligations under the Contract
which it is required to perform by September 1, 1997, SWBT will place
an additional payment of $100,000.00 in the overnight mail to TSG on
that date;
(d) If TSG has complied with all of its obligations under the Contract
which it is required to perform by December 31, 1997, including the
obligation to select and train an outside repair vendor, SWBT will
place an additional payment of $150,000.00 in the overnight mail to
TSG on that date; and
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(e) If TSG has complied with all of its obligations under the Contract
which it is required to perform by March 31, 1998, SWBT will place an
additional payment of $250,000.00 in the overnight mail to TSG on that
date.
8. In addition to the pre-existing SMDR software added to CoinNet prior to the
execution of the Contract, TSG will design and implement new
open-architecture SMDR software ("new SMDR software") by September 30,
1997. TSG warrants that the design and implementation of the new SMDR
software will be completed and will function per the REQUIREMENTS as of
that date. SWBT must procure Operating System and DBMS licenses and
hardware required for the new SMDR software excluding hardware required for
CoinNet.
(a) The new SMDR software must store SMDR data in a non-proprietary data
base so that SWBT may create user friendly ad hoc reports without
conversion or replication of the existing data outside of the CoinNet
system.
(b) Any further reference herein to the "CoinNet software," will mean all
CoinNet software, including the pre-existing and new SMDR software.
9. The parties will begin planning the requirements of a "communications
application program interface" (the "API") by July 2, 1997. The API is to
be used with "open systems" that will allow the API to directly interface
with all TSG chassis in the field, with or without the CMI electronic lock
interface. This module will include the use of protocols and access methods
used by CoinNet and the chassis to establish communication, including
controls used to negotiate and issue and/or receive commands to and/or from
CoinNet and the chassis. TSG will provide, without charge, up to fifty (50)
man days of support for the design, development and implementation of the
API by qualified TSG personnel or TSG designates. One man day is defined as
eight (8) hours. TSG will supply a minimum of ten (10) man days during the
period of July 2, 1997 through September 30, 1997. TSG will supply the
remaining forty (40) man days and any additional support requested by SWBT
as described in the next paragraph below, between October 1, 1997 and March
2, 1998. The parties may mutually agree to amend the timing of this
schedule if necessary due to the development and implementation of the new
SMDR software. TSG agrees to provide such support at SWBT's location, upon
request by SWBT. SWBT agrees to reimburse TSG for all reasonable travel
costs which are mutually agreed upon by the parties. SWBT agrees to notify
TSG at least one week in advance of any such travel request whenever
possible, but no less than seventy two (72) hours in advance.
TSG will provide additional such support for the API, upon request by SWBT.
However, any support requested over and above the aforestated fifty (50)
man days will be provided by TSG at the rate of seventy-five dollars
($75.00) per hour.
TSG will provide written substantiation documenting all support provided
pursuant to this clause. SWBT agrees to provide TSG a non-exclusive,
royalty free license for the API.
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10. SWBT will make every reasonable effort to deploy the recertified chassis in
accordance with the schedule set forth in Attachment F, "SCHEDULE FOR
DEPLOYMENT OF RECERTIFIED CHASSIS BY SWBT."
11. TSG delivered ten (10) new CMI electronic keys (CMI Product No. 2725-001),
ten (10) new electronic key controllers (CMI Product No. 2680-001) and ten
(10) new adaptors to SWBT on April 18, 1997, and an additional four hundred
and fifty-seven (457) of said keys and controllers on May 13, 1997 (without
adaptors). The previous version of the CMI electronic keys and controllers
which were replaced by said four hundred and sixty seven (467) new CMI keys
and controllers will be returned to TSG by SWBT on or before July 2, 1997.
TSG will ensure that SWBT has been provided with the number of SWBT-owned
adaptors needed for the new keys and controllers.
12. TSG will provide to SWBT all services set forth herein, for the agreed upon
time periods, including without limitation, emergency support services,
repair services for Material, software maintenance and support, and
technical support for CoinNet and Material.
13. SWBT will be responsible for maintenance of all computer hardware and
peripherals provided by TSG under the Contract.
AFFILIATED COMPANIES
"Affiliated Company" (or Companies) as used herein means any present or future
affiliate, subsidiary or parent corporation of Buyer.
An Affiliated Company that places an Order with Seller hereunder will
incorporate into such Order the terms and conditions of this Contract. Such
Affiliated Company will be responsible for its own obligations including, but
not limited to, all charges incurred in connection with such Order. Nothing in
this Contract will be construed as requiring Buyer to indemnify Seller for any
acts or omissions of an Affiliated Company.
ASSIGNMENT
Neither party hereto may assign, subcontract or otherwise transfer its rights or
obligations under this Contract except with the prior written consent of the
other party; provided, however, Buyer will have the right to assign this
Contract to any present or future affiliate, subsidiary or parent corporation of
Buyer, without securing the consent of Seller, and may grant to any such
assignee the same rights and privileges Buyer 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) Seller fails to give
Buyer at least thirty (30) calendar days prior written notice thereof, or (b)
such assignment attempts to impose upon Buyer obligations to the assignee in
addition to the payment of such money or preclude Buyer from dealing solely and
directly with Seller in all matters pertaining to this Contract, including the
negotiation of amendments or settlement of charges due.
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BREACH BY BUYER
SWBT will not be deemed to be in default under any of the terms of this
Contract, and TSG may not seek or attempt to enforce any remedy for any claimed
default, unless SWBT fails to cure or correct same within thirty (30) calendar
days following receipt of written notice thereof from TSG sent by registered
U.S. mail, to the address listed for SWBT in the NOTICES clause herein.
BREACH BY SELLER
In the event that the Integrated System fails to perform per the REQUIREMENTS as
of 5:00 P.M. CDT on July 2, 1997, SWBT shall have the right, unilaterally and at
its sole discretion, to immediately cancel this Contract in its entirety,
without advance notice or opportunity for TSG to cure and without further
obligation or penalty of any kind, including any obligation to make additional
payments to or accept additional shipments from TSG. In the event of such
failure SWBT will also have the right, unilaterally and at its sole discretion,
to continue performance under the Contract, and at the same time require TSG to
continue performance, for an additional period of time as determined by SWBT,
unilaterally and at its sole discretion. The parties agree that SWBT is not
obligated to provide any such extension. However, in the event SWBT extends the
time for performance, such extension will not constitute a waiver of its right
to cancel the contract at any time thereafter, provided the breach has
continued.
If at any point after 5:00 P.M. CDT on July 2, 1997, TSG is not in breach, but
at a later time is in breach or default of any term, condition or covenant of
this Contract, and said breach or default continues for a period of thirty (30)
calendar days after the receipt of written notice thereof from SWBT sent by
registered U.S. Mail, to the address listed for TSG in the NOTICES clause
herein, then, in addition to all other rights and remedies available at law or
in equity, SWBT will have the right to cancel this Contract immediately and
without penalty and without further obligation under this Contract, including
any obligation to make further payments to or accept additional shipments of
Material from TSG. In the event of such failure SWBT also will have the right,
unilaterally and at its sole discretion, to continue performance under the
Contract and at the same time require TSG to continue performance, for an
additional period of time within the life of the Contract as set forth herein,
as determined by SWBT, unilaterally and at its sole discretion. The parties
agree that SWBT is not obligated to provide any such extension. However, in the
event SWBT extends the time for performance, such extension will not constitute
a waiver of its right to cancel the Contract at any time thereafter, provided
the Integrated System's failure to perform per the REQUIREMENTS has continued.
CHANGES TO MATERIAL AND CLASSIFICATION THEREOF
Seller agrees to notify Buyer, in advance, of any change to be made in the
Material that would impact upon either reliability or the form, fit or function
of the Material. Seller further agrees, at the time of such notification, to
provide Buyer with: (a) a change number; (b) a description of the change; (c)
the reason for the change; (d) a description of the impact of the change upon
the following: (i) reliability, (ii) Seller's product specifications, and (iii)
form, fit or function; (e) the name of a designated person and phone number to
contact for information regarding the change;
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(f) a date after which all newly manufactured Material will have the change
applied in the manufacturing process; (g) a date by which all changes are
expected to be completed by Seller for all such Material; and (h) the
recommended repair location (Buyer's or Seller's facility).
In the event SWBT agrees to any such change, it will be Seller's responsibility
to furnish Material change notices for all Material provided hereunder in
accordance with the latest issue of GR-209-CORE, "Generic Requirements for
Product Change Notices." Such Material change notices will be forwarded to the
following address:
Contract Manager
Southwestern Bell Telephone Company
1010 Pine, Suite 900
St. Louis, Missouri 63101-3099
In order for Buyer to review such changes to the Material, a minimum of thirty
(30) calendar days advance notice will be required, except for those cases where
an extremely unsatisfactory condition requires immediate action. The final
classification of any such change to the Material proposed by Seller will be by
mutual agreement between Seller and Buyer.
For changes classified as "A" or "AC", Seller agrees to promptly modify or
replace, at no charge, all affected Material provided hereunder and the
documentation relevant thereto. Buyer will have the right to invoice Seller for
any labor expenses incurred by Buyer attributable to the replacement of such
Material.
For changes classified as "B" or "D", Seller agrees to notify Buyer of the exact
nature thereof and discuss with Buyer the details regarding the proposed
implementation procedure for affected Material which is being or will be
manufactured. Buyer will determine, at its option, if Material previously
shipped will be modified or replaced. Should such modification or replacement be
deemed necessary, Seller will arrange therefor at prices and schedules to be
mutually agreed upon with Buyer prior to implementation. Relevant documentation
for such affected Material will also be provided by Seller at no charge.
In the event that Buyer and Seller fail to reach agreement on any change in
Material proposed by Seller which materially and adversely affects the
reliability of or the form, fit or function of the Material, Buyer will have the
right without penalty to terminate this Contract and any or all additional
purchases of Material affected by any such change. Further, in such event, Buyer
will not be obligated to make any additional payments to Seller under this
Contract which are scheduled to be paid on a date after the date of termination.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
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Seller's obligations under this clause will continue until September 30, 1998
unless SWBT agrees in writing to a different period of time. Seller's
obligations under this clause will survive any termination by Buyer pursuant to
the TERMINATION clause or any cancellation of the Contract by Buyer pursuant to
the BREACH BY SELLER clause.
CHOICE OF LAW
This Contract will be governed by and construed in accordance with the laws of
the State of Missouri.
COMPLIANCE WITH LAWS
Seller agrees to comply with the provisions of the Fair Labor Standards Act, the
Occupational Safety and Health Act ("OSHA"), the National Electrical Safety Code
("NESC") and all other applicable federal, state, county and local laws,
ordinances, regulations and codes (including the identification and procurement
of required permits, certificates, approvals and inspections), in Seller's
performance under this Contract. Seller further agrees, during the term hereof,
to comply will all applicable Executive and Federal regulations as set forth in
Form SW9368, a copy of which is attached hereto as Attachment G. Seller will
defend, indemnify and hold Buyer harmless from and against any loss, liability,
damage or expense, including reasonable attorney fees and court costs sustained
by Buyer because of Seller's noncompliance herewith.
CONFLICT OF INTEREST
Seller represents and warrants that no officer, director, employee or agent of
Buyer 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
Seller or any of Seller's officers, directors, employees or agents in connection
with the obtaining, arranging or negotiating of this Contract or other documents
or agreements entered into or executed in connection herewith.
CONTINUING AVAILABILITY OF REPLACEMENT AND REPAIR PARTS
Seller agrees to offer for sale to Buyer, for a period of seven (7) years after
the shipment date of the last GemStar 4032-GSX chassis purchased under this
Contract, functionally equivalent replacement and repair parts for all Material,
at fifteen percent (15%) above TSG's cost. Upon oral or written request, TSG
will provide to SWBT written substantiation of such costs.
In the event Seller is unable to supply such parts or obtain another source of
supply that is acceptable to Buyer, then such inability will be considered to be
noncompliance with this clause and Seller agrees, without obligation or charge
to Buyer, to provide Buyer with the technical information and any other rights
that are owned and/or controlled by Seller, which are required for Buyer to
obtain such parts from other sources. TSG will use reasonable commercial efforts
to assist Buyer to obtain technical information and other rights not owned
and/or controlled by TSG.
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The "technical information" will include, by way of example only and not by way
of limitation:
(a) Manufacturing drawings and specifications of raw materials and components
comprising such parts;
(b) Manufacturing drawings and specifications covering any special tooling and
the operation thereof;
(c) A detailed list of all commercially available parts and components
purchased by Seller on the open market, disclosing the part number, name
and location of the supplier thereof and the price.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
Seller's obligations under this clause will survive any termination by Buyer
pursuant to the TERMINATION clause or any cancellation by Buyer pursuant to the
BREACH BY SELLER clause, for a period of seven (7) years after the shipment date
of the last GemStar 4032-GSX chassis purchased by Buyer hereunder.
CUSTOM SOFTWARE DEVELOPMENT
Custom Software means unique or specialized computer programs developed by
Seller, as requested by Buyer in writing after the date of execution of this
Contract. This provision does not apply to software changes or development
(including, without limitation, the new SMDR software) which TSG is obligated to
provide hereunder. Seller's rate for such development shall not exceed
seventy-five dollars ($75.00) per hour and such charges billed to Buyer shall be
substantiated upon Buyer's request. The time frame for such development shall be
mutually agreed upon in writing by Seller and Buyer on an individual request
basis.
Seller's obligations under this clause will continue through September 30, 1998
and will survive any termination by Buyer pursuant to the TERMINATION clause or
any cancellation of the Contract by Buyer pursuant to the BREACH BY SELLER
clause. However, the parties may extend the provisions of this clause upon
mutual agreement in writing. In such event, TSG's hourly rate of seventy-five
dollars ($75.00) will be subject to renegotiation.
EMERGENCY SUPPORT SERVICE
Material and Service(s)
In the event any natural or other emergency or disaster occurs whereby Material
and/or Service(s) provided pursuant to this Contract is/are rendered inoperative
and such a condition materially
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affects Buyer's ability to provide telecommunications services to its
subscribers, Seller agrees, at Buyer's request, to assist Buyer as follows:
(a) Seller will locate backup or replacement Material and/or Service(s) for
Buyer's use.
(b) Seller will provide Buyer with a periodically updated, current listing of
technical support personnel, together with after-hours telephone contact
procedures, to assist Buyer in resolving out-of-service conditions.
(c) If Material is available from Seller's stock, Seller will make every effort
to ship replacement Material in a manner specified by Buyer within
twenty-four (24) hours of receipt of Buyer's request therefor.
(d) When Material required by Buyer is not available from stock for immediate
shipment, Seller agrees to pursue the following alternative courses of
action:
(i) Assist Buyer in locating functionally equivalent substitute Material.
(ii) If requested by Buyer, schedule the repair or new manufacture of
Material on a priority basis. Buyer will indemnify Seller for any
penalties incurred by Seller as a result of such priority efforts due
to contractual obligations with third parties.
(iii)Assist Buyer by providing field technical personnel to make temporary
modifications and arrangements to mitigate the effects of
out-of-service conditions. If requested by Buyer, Seller will document
such efforts and any associated charges.
Charges for services performed by Seller under this clause and charges for
replacement Material will be at the current Contract price or, if no such
Contract price exists, Seller's then current published selling price. Additional
charges, if any, for Seller's use of overtime and premium transportation
necessary to alleviate the out-of-service condition and authorized by Buyer in
writing, will be included as a separate item on Seller's invoice.
Seller will make available the individual whose title, phone number and location
are listed below to provide assistance and information on a twenty-four (24)
hour basis for all of the support service described above:
Director of Technical Services
20 Mansell Court East, Suite 200
Roswell, Georgia 30076
(770) 587-0208
(770) 641-7528 (FAX)
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Software
(a) So long as Buyer continues to use CoinNet as developed by Seller hereunder,
but no longer than September 30, 1998, in the event of an emergency
out-of-service condition caused by defective software, including firmware,
or a disaster or other occurrence wherein Buyer's copy of such software is
destroyed or rendered unusable, Seller agrees to ship a replacement copy of
the current version of such software as installed at Buyer's installation
sites(s), within two (2) business days of oral or written notification by
Buyer. Buyer will maintain back-up copies of software in accordance with
reasonable disaster recovery procedures.
(b) Seller also agrees that there will be no charge to Buyer for such
replacement copy of the software, other than the cost of the media upon
which the software resides, plus transportation costs.
(c) In the event a situation arises that warrants the initiation of Disaster
Recovery Procedures (the "Procedures") at the installation site where
software is installed, and such Procedures require the temporary movement
of the operations of such location to back-up facilities of another company
or any other temporary back-up facilities, Seller agrees to continue to
provide software maintenance for the software as provided in the SOFTWARE
MAINTENANCE clause of the contract. All rights and/or obligations of this
Contract will remain in effect during the execution of such Procedures.
Material, Services and Software
(a) As to Material and services relating to Material, Seller's obligations
under this clause will continue for a period of seven (7) years after the
date of last shipment of Material under this Contract unless SWBT agrees in
writing to a different period of time. As to software and services relating
to software, Seller's obligations under this clause will continue through
September 30, 1998, unless SWBT agrees in writing to a different period of
time or until SWBT stops using CoinNet as developed by TSG, whichever
occurs first. Seller's obligations under this clause will survive any
termination by Buyer pursuant to the TERMINATION clause or any cancellation
of the Contract by Buyer pursuant to the BREACH BY SELLER clause.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
ENGINEERING COMPLAINTS
Buyer reserves the right to notify Seller in cases where Buyer has identified
current or potential problems or service issues concerning the operation,
maintenance, engineering, installation or design of Material furnished
hereunder. Whenever Buyer exercises such right, Seller agrees, without charge to
Buyer, to:
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(a) Accept such notice (hereinafter referred to as an "Engineering Complaint")
and handle it in accordance with the latest issue of Bell Communications
Research, Inc. ("Bellcore") technical publication GR-230-CORE, entitled
"Engineering Complaints and Service Failure Analysis Reports;"
(b) Acknowledge receipt of such Engineering Complaint and notify Buyer of
Seller's employee or representative responsible for resolving it, said
notice to be provided within fifteen (15) calendar days of Seller's receipt
thereof;
(c) Resolve such Engineering Complaint within ninety (90) calendar days of the
date Buyer's notice is received, unless a later date is mutually agreed
upon by the parties in writing. If unable to resolve an Engineering
Complaint within said ninety (90) day period, Seller will issue an "interim
report" as defined in GR-230-CORE, above;
(d) Furnish to Buyer a monthly report of the status of each open Engineering
Complaint in writing, together with a proposed schedule for the resolution
of each;
(e) Notify Buyer in writing when an Engineering Complaint has been resolved,
within ten (10) calendar days of such resolution.
All notices and reports to SWBT required under this clause will be provided in
accordance with the NOTICES clause of the contract.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
Seller's obligations under this clause will continue for a period of seven (7)
years after the date of last shipment of Material pursuant to this Contract
unless SWBT agrees in writing to a different period of time. Seller's
obligations under this clause will survive any termination by Buyer pursuant to
the TERMINATION clause or any cancellation of the Contract by Buyer pursuant to
the BREACH BY SELLER clause. There will be no charge to Buyer for services
provided pursuant to this clause prior to September 30, 1998. After that date,
said services will be provided to Buyer at Seller's established rates, which
rates will not exceed one hundred dollars ($100.00) per hour.
ERROR CORRECTIONS
Seller will supply code corrections to correct CoinNet software and chassis
firmware, errors and/or malfunctions which cause CoinNet either to be
unavailable for use by Buyer or fail to meet the applicable REQUIREMENTS
therefor. Errors and/or malfunctions may be reported to Seller by Buyer either
orally or by written notice to Seller. Seller will notify Buyer in writing of
the existence of any significant error and/or malfunction relating to Buyer's
processing environment
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or use of the CoinNet software within forty-eight (48) hours after Seller
receives notice or otherwise becomes aware of the error and/or malfunction.
"Hardware" as used herein means any equipment associated with the use of CoinNet
or other software.
1. Procedures
The error correction procedures applicable to correct errors in said software or
CoinNet will be in accordance with the following levels of error severity
assigned by Buyer based on the following conditions:
(a) Severity Level 1:
Said software and/or CoinNet functionality is inoperative and/or
intermittent; inability to use is considered by Buyer to have critical
impact to Buyer's operations.
Resolution
Seller will respond and begin diagnosis of the problem immediately.
Resolution will be within four (4) hours after Buyer's oral or written
notification to Seller. Resolution of the error will be in the form of
program code corrections or procedures for Buyer to bypass or work
around the error condition in order to continue operations. If a
bypass procedure is utilized. Seller will continue error correction
activity on a twenty-four (24) hour basis until a permanent correction
is provided to Buyer.
(b) Severity Level 2:
Said software and/or CoinNet is partially inoperative and/or
intermittent; the inoperative portion is a considered by Buyer to have
a less critical impact on Buyer's operations than Severity Level 1
errors, but is considered by Buyer to be severely restrictive.
Resolution of intermittent error conditions will be handled on a
case-by-case basis.
Resolution
Seller will respond and begin diagnosis of the problem immediately.
Resolution will be within eight (8) hours after Buyer's notification
to Seller. Resolution of the error will be in the form of program code
corrections or procedures for Buyer to bypass or work around the error
condition. If a bypass procedure is utilized, the trouble reported
will be downgraded to a Severity Level 3.
(c) Severity Level 3:
Said software and/or CoinNet is usable but with limited functionality.
Error condition is not considered by Buyer to be critical to Buyer's
continuing operations. Buyer has determined a method to work around
the error condition.
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Resolution
Seller will respond and begin diagnosis within six (6) hours.
Resolution will be within seventy-two (72) hours after Buyer's
notification to Seller. Resolution of the error will be either
correction or a report of activities necessary to correct the error
condition. If a report of activities is utilized, correction will be
accomplished within seven (7) days from time of notification.
(d) Severity Level 4:
Said software and/or CoinNet functionality is usable, but correction
is required by the next maintenance release. In the event of a
Severity Level 4 condition, Seller will suggest a resolution to
correct the error condition as soon as possible.
Resolution
Resolution will be implemented by the next regularly scheduled
maintenance release.
2. Escalation Procedures
Seller will correct any and all errors in said software and/or CoinNet in
accordance with the procedures applicable to the respective Severity Levels as
described in this clause, regardless of the source of identification. If Seller
determines that such errors cannot be corrected within the specified intervals,
Seller will immediately initiate an escalation procedure to:
(a) Immediately assign sufficiently skilled personnel to correct the error;
(b) Immediately notify Seller'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 continuing uncorrected errors to
Buyer in accordance with the NOTICES clause. A copy of each such report
will also be sent via fax to SWBT's Director-Technology Integration at
(210) 222-7702, on the same date.
3. Credits to Buyer
If any software and/or CoinNet error cannot be corrected by Seller in accordance
with this clause, Seller agrees to grant to Buyer, on the next repair invoice,
an "error credit" calculated separately for each error severity level as
follows:
(a) Severity Level 1:
The number of hours or portion thereof of inability to use over four (4)
hours, multiplied by an amount of money equivalent to Seller's average
hourly maintenance rate;
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(b) Severity Level 2:
The number of hours or portion thereof of partial inability to use over
eight (8) hours, multiplied by an amount equivalent to Seller's average
hourly maintenance rate;
(c) Severity Level 3:
The number of business days or portion thereof of limited operation over
five (5) business days, multiplied by an amount equivalent to Seller's
eight hour business day daily maintenance rate;
(d) Severity Level 4:
No credit will be applicable. However, Seller will continue to attempt to
correct all such errors until correction is accomplished.
Seller's obligations under 3(a), (b), (c) and (d) of this clause will
continue for the period from date of execution of the Contract until
September 30, 1998.
4. Rate
Seller's average hourly maintenance rate for purposes of paragraph 3,
immediately preceding, is twenty-five ($25.00) dollars regardless of the
applicable Severity Level.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
Seller's obligations under this clause will continue for a period of seven (7)
years after the date of last shipment of new GemStar 4032-GSX kits purchased
under this Contract unless SWBT agrees in writing to a different period of time
or until SWBT stops using CoinNet as developed by TSG, whichever occurs first.
Seller's obligations under this clause will survive any termination by Buyer
pursuant to the TERMINATION clause or any cancellation of the Contract by Buyer
pursuant to the BREACH BY SELLER clause. Services provided by Seller under this
clause will be provided to Buyer at no charge through September 30, 1998. After
that date said services will be provided to Buyer at Seller's established rates,
which rates will not exceed one hundred dollars ($100.00) per hour.
EXECUTION / ENTIRE AGREEMENT
Execution of this Contract will be unqualified and unconditional, and subject to
and expressly limited to the REQUIREMENTS, terms and conditions of this
Contract. All previous offers by Seller are hereby rejected and Buyer will not
be bound by terms additional to or different from
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those contained herein that may appear in any other communication from Seller,
unless such terms are expressly agreed to in a written instrument signed by
Buyer. Acceptance of Material or services, payment, or any inaction by Buyer
will not constitute Buyer's consent to or acceptance of any such additional or
different terms.
Upon execution, the terms contained in this Contract constitute the entire
agreement between Seller and Buyer with regard to the subject matter hereof and
supersedes any and all prior oral or written communications, agreements and
understandings of the parties, if any, with respect thereto. THIS CONTRACT MAY
NOT BE MODIFIED EXCEPT BY A WRITTEN INSTRUMENT SIGNED ON BEHALF OF EACH PARTY BY
THEIR RESPECTIVE REPRESENTATIVES WHO SIGN THIS CONTRACT, OR THEIR SUCCESSORS IN
TITLE AND AUTHORITY. If either party's representative is no longer employed by
Buyer/Seller 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 any
revisions to this Contract.
F.O.B.
Material purchased hereunder will be shipped F.O.B. Origin, prepaid.
FORCE MAJEURE
Neither party hereto will be held responsible for any delay or failure in
performance of any provision of this Contract to the extent that such delay or
failure is caused by fire, flood, explosion, war, strike, embargo, government
requirement, civil or military authorities, Act of God, the public enemy, acts
or omissions of carriers, or any other cause beyond the control of Seller or
Buyer. If any force majeure condition occurs, the party delayed or unable to
perform will give immediate notice thereof to the other party (the "affected
party") and the affected party may elect to:
(a) Terminate this Contract or any purchase of Material not already shipped or
services not already performed, after six (6) months notice of the force
majeure condition and said condition is not cured, provided that any such
termination will not occur prior to March 31, 1998; or
(b) Immediately suspend this Contract for the duration of the force majeure
condition, buy or sell elsewhere the Material to be bought or sold or
services not already performed hereunder, deduct from the quantity of any
purchase commitments under this Contract the quantity bought or sold or for
which such purchase commitments have been made elsewhere; not make any
further payments to Seller for new chassis to be purchased hereunder except
for product actually delivered to Buyer; and not make additional milestone
payments scheduled herein.
However, if any such force majeure condition affects only Seller's ability
to deliver said Gemstar 4032-GSX kits to be purchased hereunder, Buyer will
not be required to make any further payments for such Gemstar 4032-GSX kits
not already shipped and/or received but,
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in such event, the other provisions of the Contract will remain in full
force and effect and the parties' respective obligations under such other
provisions will continue as set forth in the Contract. In such event, Buyer
may terminate any obligation under the Contract to purchase new GemStar
4032-GSX kits not already shipped, after six (6) months notice of the force
majeure condition and said condition is not cured, provided that any such
termination will not occur prior to March 31, 1998.
(c) In the event of either (a) or (b), resume performance hereunder once the
force majeure condition ceases, provided that, if performance is resumed,
the party suffering the force majeure condition will have the option to
extend the term of this Contract up to the length of time the force majeure
condition endured.
Unless written notice to the contrary is given within thirty (30) days after the
affected party is notified of the force majeure condition, option (b) above will
be deemed selected.
FREIGHT CLASSIFICATION
Material purchased hereunder will be shipped to Buyer subject to freight charges
appropriate for goods as classified in the "National Motor Freight
Classification Catalog."
HAZARDOUS MATERIALS / 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 Transportation Act;" (b) "chemical hazards" under
current 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 all amendments to any of the foregoing.
If any Material purchased under this Contract contains a regulated substance,
Seller agrees to notify Buyer immediately and provide to Buyer all necessary
notification and other information (including but not limited to OSHA Material
Safety Data Sheets) regarding said regulated substance required by law. Seller
further agrees to defend, indemnify and hold Buyer harmless from and against any
loss, liability, damage or expense (including attorney fees and court costs)
sustained by Buyer because of Seller's noncompliance herewith.
HEADINGS
The headings of the clauses herein are inserted for convenience only and are not
intended to affect the meaning or interpretation of this Contract.
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INFANT MORTALITY
Unless otherwise agreed to in writing by Buyer, Seller hereby agrees that
Material furnished hereunder by Seller will, at the time of shipment, have
sufficient burn-in operating time at the component, circuit pack and/or system
level to assure an Infant Mortality Factor ("IMF") of not more than 3.2,
compiled with a minimum sample test of three pieces in accordance with Bellcore
Specification TR-TSY-000456, Issue 1, Section 7.2.1 (November 1989). The IMF is
the ratio of the failures experienced in the first year of operation (8,760
hours) to the failures experienced in a year of operation at Steady State
Reliability ("SSR") assuming a Weibull Infant Mortality Model with a slope of
0.75 and 10,000 hours to reach SSR.
Seller further agrees that it will, at no charge, provide Buyer or its
representative the accessibility and assistance necessary for Buyer or its
representative to verify that Material purchased hereunder satisfies the IMF and
SSR requirements.
Nothing contained herein will affect Buyer's rights hereunder, under any
warranty, or under any other provisions of the Contract.
INFRINGEMENT
Seller agrees to indemnify and hold Buyer harmless from and against any loss,
liability, damage or expense (including increased damages for willful
infringement, punitive damages, attorney 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 Material, software,
documentation, program or services furnished to Buyer hereunder, whether arising
during or after performance pursuant to the Contract, except to the extent that
such claim arises from Seller's compliance with Buyer's detailed instructions
for which Buyer agrees to indemnify Seller. Such exception will not, however,
include:
(a) Merchandise available on the open market or the same as such merchandise.
(b) Items of Seller's origin, design or selection.
Seller warrants that it has made reasonable independent investigation to
determine the legality of its right to produce and sell the Material, other
products and services provided pursuant to this Contract.
If an injunction or other order is obtained against Buyer's use of any Material,
software, documentation, program or services, or if in Seller's opinion any
Material, software, documentation, program or service is likely to become the
subject of a claim of infringement, Seller will, at its expense:
(i) Procure for Buyer the right to continue using the Material, software,
documentation, program or service; or
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(ii) After consultation with Buyer, replace or modify the Material, software,
documentation, program or service so that it constitutes substantially
similar, functionally equivalent, noninfringing Material, software,
documentation, program or service.
If the Material, software, documentation, program or service is purchased or
licensed and neither (i) or (ii) above is possible, Buyer may cancel the
applicable order and/or require Seller to remove such Material, software,
documentation, program or service from Buyer's location and refund to Buyer any
charges paid therefor.
In no event will Buyer be liable to Seller for any charges after the date that
Buyer no longer uses the Material, software, documentation, program or service
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 Seller, after notification of any claim for which Seller is
responsible, does not assume the defense of such action, Seller will reimburse
Buyer for all of its costs incurred in the defense of the claim, including, but
not limited to, attorney fees and interest on Buyer's payment of said amounts
from the date of said payment.
INSIGNIA
Upon Buyer's written request, Seller will affix certain of Buyer's trademarks,
trade names, insignia, symbols, decorative designs or evidences of Buyer's
inspection (hereafter collectively called "Insignia") to the Material furnished
hereunder. Such Insignia will not be affixed, used or otherwise displayed on or
in connection with the Material, without Buyer's prior written approval. The
manner in which such Insignia will be affixed must be approved in writing by
Buyer.
Seller agrees to remove all Insignia from Material rejected or not purchased by
Buyer prior to any sale, use or disposition thereof by Seller. Seller further
agrees to defend, indemnify and hold Buyer harmless from and against any claim,
loss, damage or expense (including attorney fees and court costs) arising out of
Seller's failure to so remove the insignia. This clause will in no way alter or
modify Seller's obligations under the USE OF INFORMATION clause of the Contract.
INSURANCE
With respect to performance hereunder, Seller agrees to maintain, at all times
during the term of this Contract, or period during which Seller's obligations
hereunder survive termination or cancellation of the Contract, the following
insurance coverage and any additional insurance and/or bonds required by law:
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(a) Workers' Compensation insurance with benefits afforded under the laws of
the state in which the work is to be performed.
(b) Employer's Liability insurance with minimum limits of $100,000 for bodily
injury by accident or disease, per employee, and $500,000 for bodily
injury by accident or disease, policy aggregate.
(c) General Liability insurance with minimum limits of $1,000,000 per
occurrence for bodily injury and property damage arising out of
Premises/Operations, $1,000,000 per occurrence Personal Injury and
$1,000,000 General Policy Aggregate (applicable to Commercial General
Liability Policies), and $1,000,000 per occurrence/aggregate for
Products/Completed Operations. Coverage must include Blanket Contractual,
Independent Contractor's Liability and Broad Form Property Damage and name
Buyer as an "Additional Insured."
(d) If use of motor vehicles is required, Automobile Liability insurance with
minimum limits of $1,000,000 per occurrence for bodily injury and property
damage, which coverage extends to all owned, hired and non-owned autos.
Insurance companies affording coverage hereunder must have a Best's Rating of
B+VII or better.
Upon Buyer's request, Seller agrees to furnish certificates or other acceptable
proof of the foregoing insurance which will provide for Buyer to be notified in
writing at least thirty (30) days prior to cancellation of or any material
change in any of the insurance evidenced thereby.
LIABILITY AND INDEMNIFICATION
SELLER AGREES TO INDEMNIFY AND SAVE BUYER (AND ALL PARENT, AFFILIATE AND
SUBSIDIARY COMPANIES, AND INCLUDING ALL OFFICERS, DIRECTORS, AGENTS AND
EMPLOYEES THEREOF) HARMLESS FROM AND AGAINST ANY AND ALL LIABILITY, LOSS, DAMAGE
OR EXPENSE (INCLUDING ATTORNEY FEES AND COURT COSTS) INCURRED BY BUYER IN
CONNECTION WITH ANY CLAIM, DEMAND OR SUIT FOR DAMAGES, INJUNCTION OR OTHER
RELIEF, CAUSED BY, RESULTING FROM OR ATTRIBUTABLE TO THE MATERIAL OR THE ACTS OR
OMISSIONS OF SELLER (INCLUDING ANY OF ITS SUPPLIERS, AGENTS OR SUBCONTRACTORS,
BUT EXCEPTING NEGLIGENT ACTS OR OMISSIONS SOLELY ATTRIBUTABLE TO BUYER), WHETHER
ARISING DURING OR AFTER PERFORMANCE PURSUANT TO THE CONTRACT, IN FURNISHING THE
MATERIAL OR PERFORMING SERVICES HEREUNDER. THIS INDEMNITY WILL SURVIVE THE
DELIVERY, INSPECTION AND ACCEPTANCE OF MATERIAL OR PERFORMANCE OF SERVICES
HEREUNDER.
SELLER FURTHER AGREES TO DEFEND BUYER (AND ALL PARENT, AFFILIATE AND SUBSIDIARY
COMPANIES, INCLUDING ALL OFFICERS, DIRECTORS, AGENTS AND EMPLOYEES THEREOF), AT
BUYER'S REQUEST, AGAINST ANY SUCH CLAIM, DEMAND OR SUIT AND BUYER AGREES TO
PROMPTLY NOTIFY
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SELLER OF ANY CLAIM OR DEMAND AGAINST BUYER FOR WHICH SELLER IS OR MAY BE
RESPONSIBLE UNDER THIS CLAUSE.
SELLER'S FOREGOING AGREEMENT TO INDEMNIFY AND SAVE BUYER (AND ALL PARENT,
AFFILIATE AND SUBSIDIARY COMPANIES, INCLUDING ALL OFFICERS, DIRECTORS, AGENTS
AND EMPLOYEES THEREOF), HARMLESS AND DEFEND INCLUDES, BUT IS NOT LIMITED TO, ANY
CLAIM, SUIT OR ACTION OF INFRINGEMENT OF ANY PATENT, TRADEMARK, COPYRIGHT, TRADE
SECRET OR ANY OTHER INTELLECTUAL PROPERTY OF ANY THIRD PARTY.
SELLER AGREES NOT TO IMPLEAD OR BRING ANY ACTION AGAINST BUYER (AND ALL PARENT,
AFFILIATE AND SUBSIDIARY COMPANIES, INCLUDING ALL OFFICERS, DIRECTORS, AGENTS
AND EMPLOYEES THEREOF), BASED ON ANY CLAIM BY ANY PERSON FOR PERSONAL INJURY OR
DEATH THAT OCCURS IN THE COURSE OR SCOPE OF EMPLOYMENT OF SUCH PERSON BY SELLER
AND THAT ARISES OUT OF MATERIAL OR SERVICES FURNISHED UNDER THIS CONTRACT OR
RESULTING FROM SELLER'S BREACH OF THE USE OF INFORMATION CLAUSE OF THE CONTRACT.
LICENSES
No licenses, express or implied, under any patents are granted by Buyer to
Seller under this Contract.
MATERIAL/SOFTWARE DOCUMENTATION
Seller agrees to provide, at no charge to Buyer, copies of all pertinent
Material/Software documentation so that Buyer will have a complete set of
documentation to operate, support, maintain, order, and install the
Material/Software purchased by or provided to Buyer. As to software and
firmware, such documentation includes without limitation, the source code,
program materials and other documentation described in Attachment A, Section
III. Any and all such documentation is confidential and proprietary, if so
marked by Seller.
Seller further agrees to provide to Buyer all documentation associated with any
Material change/correction, whether in or out of warranty, and all changes,
corrections or revisions to software and services provided to Buyer pursuant to
this Contract. This documentation will be provided to Buyer by Seller before any
Material, software or service is installed, delivered, implemented and/or
accepted, except as otherwise mutually agreed in writing. In the event of a
software overwrite correcting an emergency, service-affecting problem/defect,
any and all of the information necessary to resolve such problem/defect will be
provided in writing via facsimile or, if requested by Buyer, orally by
telephone. There will be no charge to Buyer for this documentation and/or
information, including the delivery mechanism and periodic updates. The medium
on which such documentation is to be provided will be by mutual consent. All
documentation subject to the provisions of this clause will be provided to Buyer
on or before the
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dates set forth in the SOURCE CODE REQUIREMENTS clause of the Contract. Buyer
may reproduce any and all documentation marked by Seller as proprietary or
confidential, for its own internal use, and will include Seller's copyright
notices, if any, on all such reproductions.
Buyer may modify any documentation for its own use, and at its own expense, to
meet its specific requirements. The conditions and charges, if any, for Seller's
support of such modifications will be subject to agreement between Seller and
Buyer. Any unmodified portion of such modified documentation will be subject to
the same conditions and limitations as have been designated herein for the
original documentation. Title to any such modified documentation will reside
with Buyer.
As to Material and services relating to Material, Seller's obligations under
this clause will continue for a period through September 30, 1998 unless SWBT
agrees in writing to a different period of time. As to software and services
relating to software, Seller's obligations under this clause will continue for a
period through September 30, 1998 unless SWBT agrees in writing to a different
period of time or until SWBT stops using CoinNet as developed by TSG, whichever
occurs first. Seller's obligations under this clause will survive any
termination by Buyer pursuant to the TERMINATION clause or any cancellation of
the Contract by Buyer pursuant to the BREACH BY SELLER clause.
MODIFICATION TO CONFORM TO LAWS
This Contract and all obligations hereunder will be subject to all applicable
laws, court orders, rules and regulations (collectively "Laws"), including, by
way of illustration and not limitation, the Telecommunications Act of 1996. In
the event this Contract, or any of the provisions hereof or the operations
contemplated hereunder, are found to be inconsistent with or contrary to any
such Laws, the latter will be deemed to control and, if commercially
practicable, this Contract will be regarded as modified accordingly and will
continue in full force and effect as so modified. If such modified Contract is
not commercially practicable, in the opinion of either party, then the parties
agree to meet promptly and discuss any necessary amendments or modifications in
order to comply with any such Laws, and if mutual agreement cannot be reached,
then this Contract may be terminated immediately by either party.
MONTHLY SHIPMENT REPORTS
Seller shall provide Buyer a completed Monthly Shipment Report for Material
purchased, repaired or recertified and shipped to Buyer in the preceding month
(including recertified chassis returned to SWBT) by the fifteenth (15th)
calendar day of the following month. The first report will be for the month of
June 1997, and reports shall continue from month to month thereafter. Each
report will be delivered to SWBT in accordance with the NOTICES clause of the
Contract. A copy of each report will also be sent via facsimile to SWBT's
Director-Technology Integration, (210) 222-7702, on the same date.
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NON-EXCLUSIVE DEALING
It is expressly understood and agreed that this Contract does not grant Seller
an exclusive privilege to sell to Buyer all Material which Buyer may require. It
is, therefore, understood that Buyer may contract with other manufacturers and
suppliers for the procurement of comparable products or services. However, in
such event, Buyer does not waive any of Seller's obligations under the Contract.
As to the 11,000 new GemStar 4032-GSX kits to be purchased hereunder, however,
except as otherwise provided in the Contract, Buyer is required to purchase all
of said new GemStar kits from Seller.
NON-WAIVER
No course of dealing or failure of either party to strictly enforce any term,
right or condition of this Contract will be construed as a waiver of such term,
right or condition. The waiver by Buyer in one instance of any default of Seller
hereunder will not be deemed a waiver of any other default of Seller. The
express provision herein for certain rights and remedies of Buyer are in
addition to any other legal and equitable rights and remedies to which Buyer
would otherwise be entitled.
NOTICES
Any notice, demand or report which under the terms of this Contract or otherwise
must or may be given or made by Seller or Buyer to the other, will be in writing
and given or made by overnight delivery service, facsimile, telegram or similar
communication or by certified or registered mail, return receipt requested,
addressed to the respective parties as shown:
(a) If to Buyer: Southwestern Bell Telephone Company
Procurement Contracting
1010 Pine - Suite 900
St. Louis, Missouri 63101
Attn: Mrs. Gail Meyers
(b) If to Seller: Technology Service Group, Inc.
20 Mansell Court East - Suite 200
Roswell, Georgia 30076
Attn: President
A copy of each such notice, demand or report to SWBT will also be sent via fax
to SWBT's Director-Technology Integration, (210) 222-7702, on the same date the
original is sent.
Unless otherwise provided, such notice or demand will be deemed to have been
given or made when sent, if sent by overnight delivery service, facsimile,
telegram or similar communication, or when deposited, postage prepaid, in the
U.S. mail.
The above addresses may be changed at any time by giving thirty (30) days prior
written notice as provided above.
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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 SWBT,
comply with all plant rules and regulations, including, but not limited to, the
section of SBC Communications Inc.'s "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 SWBT premises or properties. In
addition, the parties agree that, where required by government regulations,
Seller will submit satisfactory clearance from the U.S. Department of Defense
and/or other federal authorities concerned.
PUBLICITY
Seller agrees not to advertise or, except as required by the disclosure
requirements of the U.S. Securities and Exchange Commission ("SEC"), otherwise
make known to others any information regarding this Contract. Seller further
agrees not to use in any advertising or sales promotions, press releases or
other publicity matters, any endorsements, direct or indirect quotes, or
pictures implying endorsement by Buyer or any of its employees. Seller agrees to
require its subcontractors to comply with these restrictions. Buyer will provide
a copy of the final version of the Contract, except for Attachments B, C and D,
to Seller on a diskette.
QUALITY ASSURANCE
1. Seller hereby agrees that the Material furnished hereunder by Seller will
be subject to:
(a) Seller's quality control activities and procedures, including any
performance measurements, testing, quality process reviews or inspections
to implement such procedures, which are hereinafter collectively referred
to as the Quality Program Standards ("QPS").
(b) The requirements contained in the current issues of the following Bellcore
documents and subsequent issues thereof:
TR-NWT-000332 - "Reliability Prediction Procedure for Electronic Equipment"
TR-TSY-000357 - "Component Reliability Assurance Requirements for
Telecommunications Equipment"
TR-NWT-000078 - "Generic Physical Design Requirements for
Telecommunications Products and Equipment"
TR-NWT-001037 - "Statistical Process Control Program Generic Requirements"
TR-NWT-001359 - "Supplier Data - Basic Generic Requirements"
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GR-1252-CORE - "Quality System Generic Requirements For Hardware"
2. Process Surveillance procedures may be initiated by Buyer or its
representative. Seller further agrees that it will:
(a) Notify Buyer or its representative when Material is ready for examination
and give Buyer or its representative reasonable opportunity to examine
Material at any time prior to the scheduled shipment date. At Buyer's
option, examination of Material may be performed prior to final assembly
and/or completion of manufacturing or repair processes in accordance with
the above-referenced requirements;
(b) Provide Buyer or its representative with copies of Seller's and Seller's
sub-contractor(s)' quality manual(s), current inspection procedures and/or
product specifications for the Material furnished hereunder, provided the
same can be obtained from Seller's sub-contractor(s) and provided Seller's
sub-contractor(s) consent to such disclosure. Seller will make commercially
reasonable efforts to comply with this provision by July 2, 1997;
(c) Maintain and make available to Buyer or its representative the data
obtained through Seller's quality control procedures which demonstrate that
the Material meets the specified quality and reliability requirements;
(d) Provide Buyer or its representative, at no charge, access to Seller's test
equipment, facilities, data and specifications, assistance from Seller's
personnel and sufficient working space to enable Buyer or its
representative to perform said Quality Assurance Examination and/or Process
Surveillance and/or a review of Seller's total quality program at Seller's
facilities;
(e) Only Material subject to review by Buyer or its representative will be
accepted for delivery to Buyer. Where Seller is authorized by Buyer to
establish a stock of Material for future shipment, such Material will be
available for examination by Buyer or its representative prior to reserving
same for Buyer and such reserved Material will not be shipped on orders to
anyone other than Buyer; and
(f) The purchase of any Material hereunder is subject to Buyer's inspection and
acceptance after delivery thereof.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
RECORDS AND AUDIT
Seller agrees to maintain complete and accurate records of all amounts billable
to and payments made by Buyer hereunder in accordance with standard recognized
accounting practices. Seller
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shall retain such records for a period of three (3) years from the date of final
payment for Material or services specified. Seller further agrees to provide
written substantiation of any disputed invoice amount to Buyer within thirty
(30) calendar days after receipt of written notification of such dispute.
Seller agrees that Buyer shall have the right through its accredited
representatives to inspect and audit, during normal business hours, the time and
material charges invoiced to Buyer hereunder. This right to audit shall be
limited to validating the accuracy of Seller resources utilized and associated
charges to Buyer and expressly excludes the right to audit the composition of
rates invoiced, any cost or pricing data, records and information pertaining to
any other Buyer or Seller's accounting policies or practices. Should Buyer
request an audit, Seller will make available the pertinent utilization records
and files. All costs directly attributable to such audit will be paid by Buyer.
RELEASES VOID
Neither party will require waivers or releases of any personal rights from
representatives of the other in connection with visits to each other's
respective premises, and no such releases or waivers will be pleaded by Seller,
Buyer or third persons in any action or proceeding.
RELIABILITY
Beginning July 2, 1997, Buyer and Seller will monitor the cumulative failure
rate of the Material specified below. If the cumulative failure rate of any such
Material exceeds that identified in paragraph (a) or (c) of this clause, or if
CoinNet fails to perform as set forth in (d), any such failure(s) will
constitute a breach of contract by Seller.
(a) Chassis
For purposes of this clause the term "cumulative base chassis" means the
total number of chassis recertified by TSG (as described above in the
COMMITMENTS OF THE PARTIES clause) and new chassis purchased hereunder,
which are deployed by SWBT in the field. The term "cumulative failure rate"
means the percentage of the cumulative base chassis which fail to perform
per the REQUIREMENTS. TSG warrants that the cumulative failure rate of the
cumulative base chassis will not exceed six percent (6%). The first
cumulative failure rate calculation will be on October 31, 1997. Subsequent
cumulative failure rate calculations will be made as of the last business
day of each month after October 1997. Failures, for purposes of cumulative
failure rate calculations as described in this clause, include infant
mortality and out of box failures. Cumulative failure rate calculations
will be adjusted as necessary for any errors identified by Buyer or its
representatives pursuant to the REPAIR SERVICES FOR MATERIAL and
COMMITMENTS OF THE PARTIES clauses of the Contract, including any and all
errors made by Seller in the designation of cumulative base chassis as No
Trouble Found ("NTF") chassis.
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(b) If the NTF's for all chassis returned to TSG for repair (excluding chassis
returned for recertification) for any one calendar month after June 1997
exceed ten percent (10 %) of the total number of chassis returned for
repair during that month, Buyer will pay Seller a charge of twenty-five
dollars ($25.00) for each of the chassis which exceed ten percent (10%).
(c) TSG warrants that, beginning with June 1, 1997, the cumulative failure rate
of the four hundred sixty-seven (467) new CMI electronic keys delivered in
April and May 1997 will not exceed six percent (6%). The cumulative failure
rate of said keys will be the percentage of the four hundred sixty-seven
(467) keys which fail to perform per the REQUIREMENTS. The first cumulative
failure rate calculation date of the keys will be August 31, 1997.
(d) TSG warrants that, beginning at 5:00 P.M. CDT, July 2, 1997, CoinNet will
perform per the REQUIREMENTS at all times up to and including September 30,
1998.
REPAIR SERVICES FOR MATERIAL/SELECTION OF OUTSIDE REPAIR VENDOR
TSG will provide repair services for Material still under warranty and for
Material which is out-of-warranty, as follows:
(a) Material Under Warranty
Seller will provide repair services for Material still under warranty
throughout the warranty period, at no charge to Buyer.
Material repaired while still under warranty will be warranted by TSG to
perform per the REQUIREMENTS for the balance of the original warranty
period or ninety (90) days, whichever is greater.
If a unit of Material under warranty is returned to Seller as provided in
this clause, and is determined to be beyond repair, Seller will so notify
Buyer and will provide a replacement to Buyer, which replacement will be
warranted by Seller for the balance of the original warranty period or
ninety (90) days, whichever is greater.
All transportation charges for and risk of in-transit damage or loss to
Material still under warranty shipped to Seller by Buyer for repair, will
be borne by Seller. All transportation charges for and risk of in-transit
damage or loss to repaired Material shipped to Buyer by Seller, will also
be borne by Seller.
(b) Material Not Under Warranty
Seller agrees to provide out-of-warranty repair service on all Material
purchased by Buyer before or after execution of the Contract, at Buyer's
expense. Out-of-warranty material will be shipped by Buyer to Seller for
repair to a destination designated by Seller.
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Out-of-warranty Material returned to Seller for repair will be repaired by
TSG and warranted to perform per the REQUIREMENTS for ninety (90) days from
the date of return shipment.
If out-of-warranty material returned for repair is determined to be beyond
repair, Seller will so notify Buyer. If requested, Seller will sell Buyer a
replacement at the higher of the Contract price or Seller's then current
published price or, if no such prices exist, at a price to be mutually
agreed upon by the parties. In such event, the replacement will be
warranted by Seller to perform per the REQUIREMENTS for a period of one (1)
year.
All transportation charges for and risk of in-transit damage or loss to
out-of-warranty Material returned to Seller for repair under this clause,
will be borne by Buyer. All transportation charges associated with the
return of such repaired or replacement Material to Buyer, will be borne by
Buyer but prepaid by Seller and listed as a separate item on Seller's
invoice for repair. Seller will bear the risk of in-transit damage or loss
for shipments of repaired or replacement Material to Buyer.
The cost to Buyer of out-of-warranty repair for chassis will be fifty
dollars ($50.00) per chassis, which cost will be subject to annual rate
increases of no more than five percent (5%).
(c) Procedures Applicable to Both Under Warranty and Out-of-Warranty Repair
Buyer may contact Seller concerning any questions that may arise concerning
repair, at no charge to Buyer.
Buyer shall furnish the following information with Material returned to
Seller for repair: (a) Buyer's name and complete address; (b) name(s) and
telephone number(s) of Buyer's employee(s) to contact in case of questions
about the Material to be repaired; ( c) "ship to" address for return of
repaired Material if different from address in (a); (d) a complete list of
Material returned; (e) the nature of the defect or failure, if known; and
(f) whether or not the returned Material is still under warranty.
Repair or replacement Material will be marked by Seller to show the
warranty expiration date, stenciled or otherwise identified in a permanent
manner, at a readily visible location on the Material and packing box.
All invoices originated by Seller for repair services must be clearly
identified as such, and must contain a reference to Buyer's order for said
repair services. Invoices for repair services will be paid by Buyer, net
thirty (30) days.
In addition to the foregoing, TSG will provide Monthly Repair Reports to
SWBT in accordance with the NOTICES clause of the Contract. A copy of each
report will also be sent via facsimile to SWBT's Director-Technology
Integration, (210) 222-7702, on the same date. Each report will include the
preceding calendar month and must be received by SWBT by the fifteenth
(15th) calendar day of the following month. The first report will be for
the month of June 1997. Each report will include the following information:
1) the total number
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of chassis recertified by TSG (as described above in the COMMITMENTS OF THE
PARTIES clause), new chassis purchased hereunder, and deployed TSG chassis
purchased by SWBT prior to the execution of this Contract which are still
under warranty, which were tested by TSG during each such month; 2) the
number of said chassis tested during each such month and found not to
perform per the REQUIREMENTS; 3) the repairs that were required; and 4) the
number of said chassis which were determined by TSG to be NTF during each
such month.
SWBT or its representatives will have the right to audit the testing and
repair performed by TSG pursuant to this clause at any time, wherever
performed, upon giving twenty-four (24) hours oral or written notice to
TSG.
Unless otherwise agreed upon by the parties, Seller will make commercially
reasonable efforts to repair and return ship all repaired and replacement
Material within thirty (30) calendar days of receipt of the Material for
repair.
(d) Selection of Outside Repair Vendor by TSG
TSG, at no charge to SWBT, will select and train a qualified, competent
repair vendor ("outside vendor") acceptable to SWBT by December 31, 1997,
and provide said vendor with all manuals, specifications, documents and
other information needed to perform repair on all Material. SWBT will not
unreasonably withhold its approval of an outside vendor so selected by TSG.
SWBT will have the right to require reasonable assurance from TSG of said
vendor's qualifications and that said outside vendor has been adequately
trained to perform the competent repair of all Material. TSG will also
provide said vendor with a list of all repair parts that are needed, or may
be needed, to repair all Material, and will identify each such repair part
by part number or other identification, and identify the manufacturer
and/or supplier of each such part. It will be TSG's responsibility to reach
agreement with said vendor regarding the protection of TSG's confidential
technical documentation and information.
TSG will sell all parts necessary to make repairs to the Material to the
outside vendor at fifteen percent (15%) above TSG's cost. TSG will provide
written substantiation of such cost to SWBT, upon request.
SWBT will have the right to negotiate the cost of repair of SWBT's Material
directly with the outside vendor selected by TSG. If said outside vendor
will not agree to provide repair services at an average price within one
hundred fifty percent (150%) of TSG's price, TSG will pay to the outside
vendor on Buyer's behalf, the incremental difference between one hundred
fifty percent (150%) of TSG's price and the outside vendor's price, through
September 30, 1998.
TSG's failure to select and train an outside repair vendor as required
herein will constitute a breach of the Contract by TSG, concerning which
breach SWBT is not required to provide advance notice nor allow TSG an
opportunity to cure. In the event of such breach, SWBT
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will have the right to immediately cancel this Contract without penalty or
further obligation to TSG, including the payment to be made to TSG on
December 31, 1997 and all subsequent payments scheduled thereafter under
the Contract. Further, in such event, SWBT will not be obligated to
purchase or accept any additional shipments of new GemStar 4032-GSX kits
scheduled hereunder.
(e) Selection of Outside Repair Vendor by SWBT
TSG will not have the exclusive right to provide repair services for
Materials. SWBT may, at any time during the time TSG is obligated to
provide said repair services hereunder, select a vendor of SWBT's choice to
provide such services. TSG will provide said vendor information,
documentation, repair parts and parts lists ("resources") in accordance
with TSG's obligations to provide such resources to a repair vendor
selected by TSG as described in paragraph (d) of this clause, provided that
such vendor selected by SWBT signs an appropriate non-disclosure agreement
regarding the protection of TSG's proprietary information and
documentation. TSG will provide services under this sub-paragraph (e) at an
hourly rate of seventy-five dollars ($75.00). If travel by TSG personnel is
required, Buyer will reimburse TSG for normal business travel expenses. TSG
will not be responsible to provide computer hardware to any vendor selected
by SWBT.
The foregoing notwithstanding, nothing contained in this clause will waive
or otherwise adversely affect Buyer's rights under the WARRANTY clause or
any other provision of this Contract, and will not alter any time period
within which Seller is obligated to perform as set forth in the Contract.
Seller's obligations under this clause will continue for a period of seven
(7) years after the date of last shipment of Material pursuant to this
Contract unless SWBT agrees in writing to a different period of time.
Seller's obligations under this clause will survive any termination by
Buyer pursuant to the TERMINATION clause or any cancellation of the
Contract by Buyer pursuant to the BREACH BY SELLER clause.
RIGHT OF ACCESS
Both Seller and Buyer will permit reasonable access to the other's facilities in
connection with work hereunder. No charge will be made for such visits. It is
agreed that twenty four (24) hours prior notice will be given when such access
is requested. Seller agrees to remove any of its employees from Buyer's premises
at Buyer's request.
SELLER'S INFORMATION
Information, including specifications, drawings, sketches, models, samples,
tools, computer or other apparatus programs, technical information or data,
written, oral or otherwise, furnished by Seller to Buyer under this Contract or
in contemplation thereof will not be considered to be confidential or
proprietary unless so marked by Seller as confidential or proprietary.
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SELLER'S LIMITATION ON PAYMENTS TO BUYER
Notwithstanding anything in the Contract to the contrary, in no event shall the
damages, charges, credits, assessments or the like, in the aggregate, payable by
Seller arising from the provisions of the SHIPMENTS TO BUYER, RELIABILITY, and
ERROR CORRECTION Clauses hereunder exceed five (5%) percent of the then total
invoice amounts issued by Seller to Buyer hereunder.
SEVERABILITY
If any provision of this Contract is determined to be invalid or unenforceable,
such invalidity or unenforceability will not invalidate or render unenforceable
the entire Contract, but rather the entire Contract will be construed as if it
did not contain the particular invalid or unenforceable provision(s) and the
rights and obligations of Seller and Buyer will be construed and enforced
accordingly.
SHIPMENTS TO BUYER
Seller shall be allowed a maximum shipping interval of thirty (30) calendar days
after each of the purchase dates set forth in the COMMITMENTS OF THE PARTIES
clause, paragraph 6, to ship said kits purchased on each such date. Each such
shipment must be received by Buyer within ten (10) calendar days of the last day
of the maximum shipping interval unless otherwise mutually agreed by the
parties, in writing. Unless mutual agreement is reached, should Buyer request
rescheduling resulting in an extension of the shipping date by more than
fourteen (14) days beyond the maximum shipping interval for any shipment, Seller
shall be entitled to assess a charge of one and one half percent (1.5%) of the
chassis price per month on chassis included in the rescheduled shipment. Should
Seller fail to make each shipment of said chassis within said thirty (30) day
maximum shipping interval, Seller will be in breach of the Contract and Buyer,
without advance notice or opportunity for TSG to cure, will have the right to
immediately cancel the Contract, without penalty or further obligation to TSG,
including the withholding of all subsequent milestone payments and payments for
material and services not already delivered and/or provided to SWBT. In such
event, SWBT will not be obligated to purchase or accept any additional shipments
of new GemStar 4032-GSX kits scheduled hereunder.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
SHIPPING AND BILLING
Seller agrees to:
(a) As to the new GemStar 4032-GSX kits purchased on each date set forth in
the COMMITMENTS OF THE PARTIES clause, paragraph 6, ship the total number
of kits
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purchased on each such date in one shipment, unless instructed otherwise by
Buyer. As to any other Material, ship orders complete unless instructed
otherwise by Buyer;
(b) Ship each shipment to the destination designated by Buyer in accordance
with any specified routing instructions.
(c) Package, mark and label Material in accordance with Buyer's Specification
No. 76295 (except in connection with any bar code requirements) already in
Seller's possession and made a part hereof by this reference. Adequate
protective packaging will be furnished by Seller at no additional charge.
Seller further agrees to use MacPac packaging, unless otherwise mutually
agreed between the parties, and identify repaired Material with green tape
on the exterior of the packing box as well as on the individual unit boxes;
(d) Enclose the appropriate packing memorandum with each shipment and, when
more than one (1) package is shipped, clearly identify the package
containing the packing memorandum;
(e) Mark Buyer's order and/or purchase number, item sequence numbers, and item
identification numbers and descriptions on all packages, subordinate
documents and shipping papers;
(f) Render invoices in duplicate or as otherwise specified by Buyer, showing
Buyer's order and/or purchase number, item sequence numbers, item
identification numbers and descriptions, through routing and weight;
(g) Render separate invoices for each shipment;
(h) Mail bills of lading, if applicable, shipping notices and copies of
transportation bills with Seller's invoices to Buyer's address indicated on
the applicable order or other purchase document.
(i) Include only one (1) such order or shipment on each invoice.
(j) The GemStar 4032-GSX electronic chassis, electronic lock and cash box out
switch which comprise each kit will be shipped as one (1) kit within the
same box.
For shipments made to Buyer's Material Distribution Center ("MDC") in Lancaster,
Texas, if any, Seller agrees to ship Material on pallets with dimensions of 42"
by 42" and stack Material thereon no higher than 48".
If prepayment of transportation charges is authorized, Seller will include the
transportation charges for the Material from the F.O.B. point to the designated
destination as a separate charge on Seller's invoice therefor.
Shipping and routing instructions may be altered by mutual agreement of the
parties in writing. Unless otherwise agreed, all invoices for the new GemStar
4032-GSX kits purchased hereunder will be payable net thirty (30) days from
Buyer's receipt of the invoice or kits, whichever is later.
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As to Seller's provision of other Material and services, invoices will be
payable net thirty (30) days from the date of Buyer's receipt of the invoice or
Material or services, whichever is later. Discounts may be taken when allowed.
C.O.D. shipments will not be accepted. Late payment charges will be assessed at
a rate of one and one-half percent (1.5%) per month.
SHIPPING PRIORITY
Seller will afford Buyer shipping priority over other customers in accordance
with mutually agreed to shipping schedules.
SOFTWARE MAINTENANCE
Seller agrees to furnish software maintenance services to Buyer, at no charge,
through September 30, 1998. After September 30, 1998, Seller agrees to furnish
software maintenance services to Buyer at an hourly rate of seventy-five dollars
($75.00), which rate shall be subject to annual increases of no more than five
percent (5%). "Software maintenance" means any of the services provided by
Seller that are designed to maintain the software in conformance with the
REQUIREMENTS.
Seller's obligations under this clause will continue for a period of seven (7)
years after the date of last shipment of Material under this Contract unless
SWBT agrees in writing to a different period of time or until SWBT stops using
CoinNet as developed by TSG, whichever occurs first. Seller's obligations under
this clause will survive any termination by Buyer pursuant to the TERMINATION
clause or any cancellation of the Contract by Buyer pursuant to the BREACH BY
SELLER clause.
SOFTWARE UPDATES
Seller agrees to supply improvements, new releases, updates, extensions, and
other changes to the CoinNet software and firmware, including the pre-existing
and new SMDR software to be developed hereunder, which: (a) Seller provides to
other customers who have a license to use any such software; (b) Seller deems to
be logical improvements or extensions to the original software supplied to
Buyer; or (c) are necessary for the software to continue the computing functions
mutually agreed upon between Seller and Buyer. Buyer 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
Buyer's computer system. In addition, Seller will insure that software licensed
hereunder is kept current with new releases of the operating system(s) listed in
Seller's standard published specifications or the REQUIREMENTS. Such software
updates will be provided to Seller at no charge. Software updates will be
provided to Buyer at Seller's published prices, after September 30, 1998.
Seller's obligations under this clause will continue for a period of seven (7)
years after the date of last shipment of Material under this Contract unless
SWBT agrees in writing to a different period of time or until SWBT stops using
CoinNet as developed by TSG, whichever occurs first. Seller's obligations under
this clause will survive any termination by Buyer pursuant to the
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TERMINATION clause or any cancellation of the Contract by Buyer pursuant to the
BREACH BY SELLER clause.
SOURCE CODE REQUIREMENTS
(a) TSG will provide to SWBT a copy of the most current version of the CoinNet
software source code and documentation as described in Attachment A, as
well as any other information and/or materials required to support,
maintain, order, install, modify or correct said software, by July 2, 1997.
(b) The new SMDR software source code and documentation (source code and
documentation as described in Attachment A, Section III), as well as any
other information and/or materials required to support, maintain, order,
install, modify or correct said software, will be provided to SWBT by TSG
on or before September 30, 1997.
(c) As to the CoinNet software, TSG will provide to SWBT, without charge, a
copy of the source code and documentation of any and all changes and/or
revisions to said software, including all information and/or materials
pertinent thereto, of the same type and/or nature as that described in (a)
and (b) above.
(d) Seller's obligations under this clause will continue through September 30,
1998 unless SWBT agrees in writing to a different period of time or until
SWBT stops using CoinNet as developed by TSG, whichever occurs first.
Seller's obligations under this clause will survive any termination by
Buyer pursuant to the TERMINATION clause or any cancellation of the
Contract by Buyer pursuant to the BREACH BY SELLER clause.
SUPPORT OF PREVIOUS VERSIONS / SOFTWARE
When Seller issues a new version of existing software, as provided in the
SOFTWARE UPDATES clause of the Contract, Seller agrees to provide error
correction and technical support for the previous version of that software,
without charge to Buyer. Services provided under this clause after September 30,
1998, will be provided at a price of seventy-five dollars ($75.00) per hour,
which price will be subject to annual increases of no more than five percent
(5%).
Seller's obligations under this clause will continue for a period of seven (7)
years after the date of last shipment of Material under this Contract unless
SWBT agrees in writing to a different period of time or until SWBT stops using
CoinNet as developed by TSG, whichever occurs first. Seller's obligations under
this clause will survive any termination by Buyer pursuant to the TERMINATION
clause or any cancellation of the Contract by Buyer pursuant to the BREACH BY
SELLER clause.
SURVIVAL OF OBLIGATIONS
In addition to the survival of obligations as set forth elsewhere in the
Contract, Seller's obligations hereunder which by their nature would continue
beyond the termination, cancellation or expiration
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hereof, including, by way of illustration only and not limitation, those
obligations in the clauses entitled "COMPLIANCE WITH LAWS," "INFRINGEMENT,"
"LIABILITY AND INDEMNIFICATION," "PUBLICITY," "RELEASES VOID," "SEVERABILITY,"
"USE OF INFORMATION" and "WARRANTY," will survive the breach, termination,
cancellation or expiration of the Contract.
TAXES
In the event that Buyer is liable under federal law for excise taxes or under
state or local law for sales taxes collected by Seller on the Material provided
hereunder, Seller agrees to bill such taxes as separate items, listing each tax
jurisdiction involved. Buyer will have the right to require Seller to contest
with the imposing jurisdiction, at Buyer's expense, any taxes or assessments
which Buyer may deem to be improperly levied. Seller further agrees, upon
request of Buyer, to furnish statements evidencing that taxes and assessments
for which Buyer is responsible hereunder and which have been billed to Buyer by
Seller, have been paid.
TECHNICAL SUPPORT FOR COINNET AND MATERIAL
Buyer shall be entitled to ongoing, timely technical support service, including
field service support and access to Seller by telephone for all CoinNet software
and firmware and Material. The availability or performance of this technical
support service shall not be construed as altering or affecting Seller's
obligations as set forth in the WARRANTY clause or as elsewhere provided in this
Contract. Said support will be provided at no charge through September 30, 1998.
Thereafter, said support will be provided by Seller at a price of seventy-five
dollars ($75.00) per hour, subject to annual price increases of no more than
five percent (5%).
Said ongoing technical support will be available to Buyer from Seller via
telephone during normal working hours. Response to Buyer shall be within one
hour (1) after a request is made provided that the request is made and can be
answered within normal working hours. Technical support for CoinNet and the
Material shall be ongoing and extend beyond the warranty period for seven (7)
years after the last shipment of Material under this Contract, unless SWBT
agrees in writing to a shorter period of time or, as to CoinNet software and
firmware, at such time as Buyer stops using CoinNet as developed by Seller.
Buyer will call Seller for technical support for CoinNet software, firmware and
Material, by calling the following number during the times indicated:
1-800-447-8353
8:00 AM - 5:00 PM EASTERN TIME (M-F)
Seller will give SWBT thirty (30) days advance notice of any change in the
technical support call number.
So long as Buyer continues to use CoinNet, Seller agrees to provide Buyer all
necessary mail and telephone consulting assistance in the event that
difficulties occur in the use of the software or in Buyer's interpretation of
the results of software use. Upon notification by Buyer that such
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consulting service is required, Seller will proceed promptly toward the
resolution of all such reported problems by using and coordinating all Seller
resources which are required to resolve the problem.
Further, as to CoinNet, after July 2, 1997, if a reported problem cannot be
resolved by telephone or written communication within thirty (30) days from the
time Buyer first contacts Seller then, if requested by Buyer, Seller will
provide an employee capable of resolving such problem at the applicable Buyer
installation site for no additional charge, provided that the problem is the
failure of the software to perform per the REQUIREMENTS. However, SWBT agrees to
pay reasonable travel expenses for mutually agreed upon travel of TSG personnel
which is necessary to provide services under this clause. If such failure causes
downtime on Buyer's computer system on which the software is installed, then
Seller will proceed immediately to resolve the problem.
In the event that a problem is found to be due to: (a) a modification to the
software made by Buyer; or (b) use of the software in a manner which is not in
accordance with the instructions provided by Seller to Buyer relating to use of
the software as set forth in the COINNET OPERATING GUIDELINES in Attachment A,
Buyer agrees to pay Seller for all technical support or services performed to
resolve or investigate the particular problem at Seller's then current published
standard time and material rates, and reimburse Seller for any related expenses
incurred, provided that such rates and expenses are reasonable and Seller
furnishes to Buyer supporting documentation therefor.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely affect Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
Seller's obligations under this clause will survive any termination by Buyer
pursuant to the TERMINATION clause or any cancellation of the Contract by Buyer
pursuant to the BREACH BY SELLER clause.
TERMINATION
Buyer may terminate this Contract without cause, in whole or in part, at any
time, by giving Seller at least thirty (30) days prior written notice. Upon
termination, Buyer agrees to pay Seller all amounts due for the new GemStar
4032-GSX kits to be purchased by Buyer hereunder which have not yet been
purchased and paid for, as set forth in the purchase schedule set forth herein,
payments to be made net thirty (30) days after the respective scheduled purchase
dates, provided however, that the chassis to have been purchased on each such
purchase date have been shipped and delivered to SWBT as scheduled and ownership
thereof has passed to SWBT.
The milestone payments to be made to Seller on July 2, September 1, and December
31, 1997, and on March 31, 1998, will also be paid as scheduled. In the event of
such termination, Buyer will pay any amount due to Seller for performance of
services under this Contract, payable net
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thirty (30) days from receipt of invoice. Upon request from Buyer, Seller will
provide written substantiation of all such services billed to Buyer.
In the event SWBT elects to terminate the Contract in accordance with the
TERMINATION clause of the Contract, or cancels the Contract pursuant to the
BREACH BY SELLER clause of the Contract, TSG will return to SWBT within thirty
(30) calendar days, at the cost of the party who would have otherwise borne the
cost of return shipment as provided herein, all TSG electronic chassis owned by
SWBT in TSG's possession including, but not limited to, chassis returned to TSG
for repair and/or recertification, in their then present condition, whether or
not they have been repaired, upgraded or recertified. TSG agrees that TSG's
unauthorized holding of any such chassis past thirty (30) calendar days, will
cause damages to SWBT that will be difficult to determine. Therefore, TSG agrees
to pay SWBT liquidated damages calculated by multiplying the average monthly
revenues of a deployed SWBT payphone divided by thirty (30) by the number of
chassis withheld, times the number of days past thirty (30) that expire before
the chassis are delivered to SWBT's possession. The parties agree that such sum
constitutes a reasonable estimate of SWBT's actual financial losses.
TESTING
Buyer may, at its expense, have any or all Material tested, repaired,
recertified or purchased hereunder, tested by Bellcore or other independent
vendor selected by Buyer. Failure of the products to test in compliance with the
REQUIREMENTS will be addressed on a priority basis by Seller. Seller and Buyer
will develop a mutually agreed upon time line for Seller to resolve
noncompliance. Failure to correct such problems in accordance with the time line
may result in termination of this Contract and all commitments will be null and
void on the part of the Buyer.
The foregoing notwithstanding, nothing contained in this clause will waive or
otherwise adversely Buyer's rights under the WARRANTY clause or any other
provision of this Contract, and will not alter any time period within which
Seller is obligated to perform as set forth in the Contract.
TITLE AND RISK OF LOSS
Title to Material purchased hereunder will vest in Buyer when the Material has
been delivered and accepted at the F.O.B. point designated by Buyer. If this
Contract calls for additional services such as unloading, installation or the
like to be performed after delivery, Seller will retain risk of loss to the
Material until the additional services have been performed to Buyer's
satisfaction.
TRAINING
Seller will provide Buyer training, training materials and technical support to
enable Buyer to properly and effectively use CoinNet (including all hardware and
peripherals, software and firmware) and Material, at no charge to SWBT, through
September 30, 1997. Thereafter, such training, training materials and support
will be provided by Seller at a rate of seventy-five dollars ($75.00) per hour,
which rate will be subject to annual increases of no more than five percent
(5%).
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Seller's obligations under this clause will continue for a period of seven (7)
years after the date of last shipment of Material pursuant to this Contract
unless SWBT agrees in writing to a different period of time. Seller's
obligations under this clause will survive any termination by Buyer pursuant to
the TERMINATION clause or any cancellation of the Contract by Buyer pursuant to
the BREACH BY SELLER clause.
USE OF INFORMATION
Any specifications, drawings, sketches, models, samples, tools, computer or
other apparatus programs, technical or business information or data, written,
oral or otherwise (all hereinafter designated "Information"), furnished to
Seller by Buyer in regard to CoinNet or the Material since January 1994, or
under this Contract, or in contemplation thereof, will remain Buyer's property
and all copies thereof, in written, graphic or other tangible form, will be
returned to Buyer upon request. Seller agrees to keep the information
confidential in performing under this Contract and not use same for any other
purpose except upon such terms as may be agreed upon by Seller and Buyer in
writing.
WARRANTY
Seller warrants to Buyer that Material purchased, recertified, repaired or
upgraded hereunder will be merchantable, free from defects in design, material
and workmanship, fit and sufficient for the purposes intended by Buyer for the
applicable warranty period as set forth in the Contract. Material will be free
from all liens and encumbrances and will conform to and perform per the
REQUIREMENTS and in accordance with any other applicable specifications,
drawings and samples.
Seller warrants to Buyer that any services provided hereunder will be performed
in a first-class, workmanlike manner.
Seller warrants to Buyer that the media on which software is furnished will be
free from defects in material and workmanship and free from all liens and
encumbrances. Seller further warrants that the software will conform to and
perform in accordance with any of Seller's documentation, specifications,
drawings, product literature and samples, and the REQUIREMENTS.
In addition, if Material or software contains one or more manufacturer's
warranties from a party other than Seller, Seller hereby assigns such warranties
to Buyer. These warranties will be in addition to all other warranties, express,
implied or statutory.
Seller warrants that Material furnished hereunder conforms with and will perform
in accordance with Attachment A and with Seller's product specifications for
Material described in Attachments B, C, and D. Failure of the Material to
perform per the REQUIREMENTS may result in cancellation of the Contract and
render all commitments of Buyer null and void.
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All warranties will survive inspection, acceptance, payment and use. In addition
to Buyer's other remedies, Material not meeting the warranties contained herein
will, at Seller's option, be repaired or replaced by Seller at no cost to Buyer.
The warranty provisions of this clause apply with equal force to any part of
Seller's obligations under the Contract performed by or dependent on work done
by others (e.g., subcontractors) on behalf of Seller. If any part of the
services or other work performed by Seller is dependent upon work done by
others, Seller will inspect such work and promptly report to Buyer any defect
therein that renders such other work unsuitable for Seller's proper performance
hereunder. Seller's silence will constitute approval of such other work as being
fit, proper and suitable for Seller's performance of the services or other work.
Seller warrants that all Material purchased by SWBT prior to execution of the
Contract which is still within the original warranty period will perform per the
REQUIREMENTS for the remainder of said original warranty period.
Seller warrants that each of the 11,000 new GemStar 4032-GSX kits purchased
hereunder will perform per the REQUIREMENTS for a period through September 30,
1998.
TSG warrants that the Integrated System will perform per the REQUIREMENTS
through September 30, 1998.
Seller's obligations under this clause will survive any termination by Buyer
pursuant to the TERMINATION clause or any cancellation of the Contract by Buyer
pursuant to the BREACH BY SELLER clause.
IN WITNESS WHEREOF, the foregoing Contract has been executed by the parties
hereto, in two originals, as of the dates set forth below:
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________________________________ ________________________________
Vincent C. Bisceglia Date Ronald M. Jennings Date
President and CEO Vice President-General Manager
Technology Service Group, Inc. Public Communications
Southwestern Bell Telephone Company
CORPORATE ACKNOWLEDGMENTS
STATE OF TEXAS )
)
COUNTY OF DALLAS )
Before me, the undersigned Notary Public, on this day personally appeared
Vincent C. Bisceglia, known to me to be the person and officer whose name is
subscribed to the Contract. He acknowledged to me that he is the President and
CEO of Technology Service Group, Inc. and that he executed and is duly
authorized to execute the Contract in the name of and on behalf of Technology
Service Group, Inc., for the purposes and consideration expressed in the
Contract.
GIVEN under my hand and seal of office on the _____ day of June, 1997.
___________________________________________
Notary Public in and for the State of Texas
My commission expires __________
STATE OF TEXAS )
)
COUNTY OF DALLAS )
Before me the undersigned Notary Public, on this day personally appeared
Ronald M. Jennings, known to me to be the person and officer whose name is
subscribed to the Contract. He acknowledged to me that he executed and is duly
authorized to execute the Contract in the name of and on behalf of Southwestern
Bell Telephone Company for the purposes and consideration expressed in the
Contract.
GIVEN under my hand and seal of office on the _____ day of June, 1997.
___________________________________________
Notary Public in and for the State of Texas
My commission expires __________
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ATTACHMENT A
TECHNICAL STANDARDS, BENCHMARK MEASUREMENTS, SPECIFICATIONS
AND OTHER REQUIREMENTS FOR COINNET AND MATERIAL
In addition to the technical standards, benchmark measurements, specifications
and other requirements set forth elsewhere in the Contract, the technical
standards, benchmark measurements, specifications and other requirements set
forth in this Attachment will apply to CoinNet, including computer hardware and
peripherals, software (including pre-existing SMDR software added to the CoinNet
software before execution of the Contract), new SMDR software and chassis
firmware, and all Material, including GemStar 4032-GS, upgraded GemStar 4032-GS,
GemStar 4032-GSX, and all Gemini chassis (hereinafter the "chassis"), CMI-30C
electronic locks (hereinafter the "locks"), CMI 2752-001 electronic keys
(hereinafter the "keys"), CMI 2680-001 electronic key controllers (hereinafter
the "controllers"), and associated power sources (hereinafter the "adaptors"),
which CoinNet and Material are subjects of the Contract to which this Attachment
is attached. All of the technical standards, benchmark measurements,
specifications and other requirements set forth in this Attachment and elsewhere
in the Contract are referred to collectively herein as the "REQUIREMENTS." All
technical standards, benchmark measurements, specifications and other
requirements are subject to Buyer's operation of the Integrated System in
accordance with the instructions set forth in the COINNET OPERATING GUIDELINES,
below.
COINNET HARDWARE AND SOFTWARE REQUIREMENTS
I. Assumptions
1. The term "peak hours" as used herein, means the hours from 10 a.m. to 3
p.m. and from 9 p.m. to 12 a.m., inclusive.
2. All benchmark measurements, except for trunk busy studies, should be
considered to have sampling rates of one every fifteen minutes and be
averaged over a two week period known as the "study period." Trunk busy
studies will provide the total number of occurrences per hour, to be
averaged over a one week period.
3. The system must perform per the REQUIREMENTS with all features and
functionalities as required in the Contract including, without limitation,
the pre-existing SMDR software and the additional SMDR software to be
developed hereunder ("new SMDR software") and support all TSG chassis,
including GemStar 4032-GS, upgraded GemStar 4032-GS, GemStar 4032-GSX, and
all Gemini chassis purchased by SWBT both before and after the execution of
the Contract. TSG understands that the total number of such chassis may be
up to 75,000.
4. CoinNet must simultaneously support all deployed chassis, up to 15
concurrent interactive administrative users, the existing base of 360
technicians who perform installations, collections and repair, up to 20
concurrent reports (with no more than 5 of said reports being SMDR reports)
in normal peak hours operations and up to 15 concurrent manual polls.
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Normal "peak hours" operational functions and reports include:
o Adds, deletes and changes to the phones database.
o Adds, deletes and changes to the options database.
o Global changes to the phones database.
o Building phone groups based on phones database criteria.
o Phone database reports.
o Manual polling of phones.
o System log reports.
o Daily tape backup.
o SMDR reports.
Operational functions that will be performed outside of "peak hours"
include:
o PaSS export for collected phones, exported from phones database. Run
four (4) times a day, two (2) times during "peak hours" and twice
during "non peak" hours.
o PaSS import of route and stop information to the phones database.
o "Needs collect" report processed and faxed to 87 sites.
o FTP of all databases to backup machine.
o Daily maintenance reports processed.
o Autopolling.
TSG will notify SWBT of the impact on CoinNet's ability to perform per the
REQUIREMENTS that may and/or will result from mutually agreed upon changes
to said features, functions, reports or processes.
5. In addition to the REQUIREMENTS set forth elsewhere in this Attachment and
in the Contract, CoinNet, it's features and functionalities, including, but
not limited to, the features, functions, reports and processes mentioned
above, must perform per the specifications of: TSG Document No.
44156-750-05A (12/94), (Attachment B); TSG Document No. 44156-770-01 (4/95
and 6/95) (Attachment C); CMI Document Nos. CS-2680-001 and CS-2752-001
(1996) (Attachment D); and all updates of said documents.
6. SWBT agrees to update all chassis deployed by SWBT with the most recent
TSG-provided software updates by July 2, 1997.
II. SYSTEM HARDWARE REQUIREMENTS
1. Memory
a. Memory utilization must maintain an average during the study period of
no less than ten percent (10%) free pages.
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b. During the study period, the system swap file must maintain an average
of forty percent (40%) free pages.
2. Disk Utilization
a. The percentage of disk subsystem busy with read/write operations
during the study period must never exceed an average of seventy
percent (70%).
b. The disk wait time during the study period must never exceed an
average of twenty (20) milliseconds.
c. Overall disk capacity must never exceed eighty percent (80%) full.
3. CPU Utilization
a. The average percentage of measured CPU utilization must never exceed
ninety percent (90%) during the study period.
b. The average percentage of CPU time waiting on block I/O (as measured
by UNIX or SCO SAR utility) must never exceed forty percent (40%) of
total non-idle processor time during the study period.
4. Busy Line (Trunk Group) Study
a. The number of overflows (also known as incoming busies) compared to
total number of calls on a trunk group must never exceed an average of
nine percent (9%) for peak hours, over any weekly study period.
III. Software/Application Requirements
1. Source Code
The software and source code for CoinNet and SMDR must be provided as required
in this Attachment and elsewhere in the Contract, and will include the
following:
a) TSG must provide to SWBT a copy of CoinNet software, including the
pre-existing SMDR software and new SMDR software, and any other software
developed for SWBT by TSG hereunder, within the respective time frames set
forth in the Contract. The source codes and program materials, as well as
any other documentation required to support, maintain, order, install,
modify, or correct the most current version of said software must also be
provided to SWBT within the respective time frames set forth in the
Contract. SWBT will have the absolute right to make any alterations,
variations, modifications, additions or improvements to the source code of
said software at its own risk and expense, or contract with third parties
for such modifications, provided such third parties are not competitors of
TSG, provided SWBT
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obtains an appropriate non-disclosure agreement from any such third party,
and provided that SWBT shall restrict the use of the source code,
documentation and software to SWBT, its parent, subsidiary and affiliate
companies.
b) Title to deliverables shall reside with TSG. All rights, title, and
interest, including copyright, in all original works for authorship fixed
in any tangible medium, will belong to TSG.
c) All rights, title and interest in and to all intellectual property produced
for SWBT by TSG shall belong to TSG and shall be considered "works made for
hire" in accordance with the United States copyright law. SWBT shall have a
non-exclusive license to use such property, which SWBT may assign to any
parent, affiliate or subsidiary company without the consent of TSG.
2. Documentation
Documentation is defined as all documentation used in relation to CoinNet
(including computer hardware and peripherals, software (including pre-existing
and new SMDR software) and chassis firmware) and Materials (including all TSG
chassis as listed in the PREAMBLE of the Contract, electronic locks, keys,
controllers and adaptors, including system procedures, functions, and database
structures, operating and instruction manuals, system level documentation and
protocols and access methods used by CoinNet and the chassis to establish
communication, including controls used to negotiate and issue and/or receive
commands to and/or from CoinNet and the chassis, and other materials describing
the structure and operation of all CoinNet software and its interfaces. TSG will
provide the documentation to SWBT before July 2, 1997, except as to the new SMDR
software, the documentation for which will be provided to SWBT as soon as the
design thereof has been completed, but no later than September 30, 1997. The
documentation will include the following but may also include other requested
and available information:
a) Library list
b) Module Map-Object Descriptions/Purpose for all objects
c) Process Overview
d) Implementation Notes
e) Description of Use
f) Specific Build Instructions
g) Process flow for application, including each subsystem
h) Current Bug List(unfixed or unresolved problems
i) Description of all development tools used
j) Third party licensing information and reference details
ELECTRONIC LOCKS, KEYS, CONTROLLERS AND ADAPTORS
The electronic locks, the four hundred sixty-seven (467) CMI keys delivered in
April and May 1997, the controllers and adaptors must perform per the
REQUIREMENTS under normal SWBT field operating conditions, including, without
limitation, the specifications and requirements set forth herein and in Control
Module, Inc.'s (CMI's) customer specification documents CS-2680
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- -001 and CS-2752-001 (1996); TSG Document No. 44156-750-05A (12/94); TSG
Document No. 44156-770-01 (4/95 and 6/95); and all updates of said documents.
ELECTRONIC CHASSIS
All new GemStar 4032-GSX chassis (including the electronic lock and cash box out
switch) purchased under the Contract, all recertified chassis (as described in
the Contract), and all other TSG electronic chassis owned by SWBT and still
under warranty, must perform per the REQUIREMENTS, under normal SWBT field
operating conditions, including, without limitation, the specifications and
requirements set forth herein and in TSG Document No. 44156-750-05A (12/94); TSG
Document No. 44156-770-01 (4/95 and 6/95); CMI customer specification documents
CS-2680-001 (1996) and CS-2752-001; and all updates of said documents.
COINNET OPERATING GUIDELINES
SWBT will perform the following procedures which may be modified from time to
time by mutual agreement of the parties.
System Administrator Daily Checks:
o Monitor and clean up unneeded files and reports. Check system clock.
o Check faxserver.
o Check Coinnet Polls.
o Check for any locked up modems. Check that faxed reports have gone
out.
o Check that daily maintenance report has run.
o Daily tape backup.
o Check that databases were FTPed to backup machine.
Operator Basic Guidelines
o Do operating system and voice file downloads on nights and weekends.
o Upgrade all chassis to the latest operating system version (H.EPE for
GS phones, L.eLE for 1 meg phones).
o Setup all 1 meg option files to allow call-ins at 1200 baud.
o Restrict Reports/Globals changes to no more than 20 simultaneously.
Only 5 simultaneous SMDR/CDR reports.
o 60-70 modems should remain dedicated to incoming call traffic during
daytime hours.
o Delete disconnected numbers from the database.
o Investigate no activity phones.
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GENERAL REQUIREMENTS
To the extent that any of the above-referenced TSG and/or CMI documents contain
specifications inconsistent with each other, the specifications contained in
Attachment A will prevail. If any of the specifications, requirements or
instructions contained in said documents have been updated or revised in any
way, TSG will so notify SWBT by 5:00 p.m. CDT on July 2, 1997.
Whether or not specifically identified in the Contract or in the
above-referenced TSG and CMI documents, TSG must provide an Integrated System
that performs per the REQUIREMENTS, the components of which Integrated System
are: CoinNet (computer hardware and peripherals, software and chassis firmware),
pre-existing and new SMDR software, electronic chassis, electronic locks, keys,
controllers and adaptors. Said Integrated System must provide the features and
functionalities set forth in the Contract and in said TSG and CMI documents and
perform per the REQUIREMENTS.
TSG must continue to support CoinNet or do so through its representatives
approved by SWBT, as set forth in the Contract, until SWBT stops using or
modifies the source code of the CoinNet software. Said support must meet the
service levels documented in the Contract including, without limitation, the
following clauses: EMERGENCY SUPPORT SERVICE, ERROR CORRECTIONS, CUSTOM SOFTWARE
DEVELOPMENT, SOFTWARE MAINTENANCE, SOFTWARE UPDATES, SUPPORT OF PREVIOUS
VERSIONS-SOFTWARE, TECHNICAL SUPPORT FOR COINNET AND MATERIAL, REPAIR SERVICES
FOR MATERIAL, CHANGES TO MATERIAL AND CLASSIFICATION THEREOF, ENGINEERING
COMPLAINTS, CONTINUING AVAILABILITY OF REPLACEMENT AND REPAIR PARTS and
MATERIAL/SOFTWARE DOCUMENTATION.
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