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EXHIBIT 10.21
CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
DEALER AGREEMENT
This Dealer Agreement ("Agreement"), dated this 20th day of December,
1996 ("Effective Date"), is between Metroplex Telephone Company d/b/a AT&T
Wireless Services ("Company"), and Telephone Warehouse, Inc., a Texas
corporation, ("Dealer"). Dealer currently does business as Telephone Warehouse;
however, this Agent shall be binding on Dealer regardless of any assumed name
under which Dealer does business.
Company provides wireless radio telecommunications services ("Service")
in the Dallas/Ft. Worth, Texas metropolitan statistical area ("Area") directly
to individuals, corporations, associations, and other entities that purchase
such Service from Company ("Subscribers"). The Area is defined by the United
States Census Bureau and consists of the following counties: Collin, Dallas,
Denton, Ellis, Hood, Johnson, Kaufman, Parker, Rockwall, Somervell, Tarrant, and
Wise.
Company has offered to Dealer the opportunity to market Company's Service
in the Area and refer to Company potential Subscribers for the Service under the
terms and conditions of this Agreement, and Dealer has accepted.
Therefore, in consideration of the mutual promises and covenants
contained herein, the receipt and sufficiency of which are expressly
acknowledged, Company and Dealer agree as follows:
1. APPOINTMENT OF DEALER.
a. Appointment Company hereby appoints Dealer as an authorized
dealer for Company within the Area to solicit, and submit for consideration,
potential Subscribers to Company's Service under Company rate plans as specified
by Company from time to time, and to provide assistance to Subscribers as may be
authorized by Company. Dealer accepts such appointment. For purposes of this
Agreement, Service does not include any wireless telecommunications services
purchased from a reseller of Company's Service, and Subscriber does not include
individuals, corporations, associations, or other entities that purchase
Company's Service from a reseller. Notwithstanding anything else in this
Agreement, Dealer acknowledges and agrees that Company may (i)sell Service
directly to Subscribers (through itself, through Affiliated entities, or both),
(ii) appoint or authorize other persons or entities to solicit Subscribers to
the Service, and (iii) sell, lease, or provide directly to Subscribers, or
appoint or authorize other persons or entities to sell, lease, or provide,
wireless telephones and related equipment (collectively, "Equipment") and/or
installation, repair, and warranty service for such Equipment
b. Term. This Agreement shall be for a five (5) year term,
commencing on the Effective Date and terminating five (5) years thereafter,
unless sooner terminated under the terms herein. Upon completion of the initial
term, this Agreement will automatically renew for one (1) additional ***
term unless either party notifies the other party of its intention not
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to renew not less than nine (9) months prior to the expiration of the initial
term. Neither party shall be under any obligation to renew or extend.
c. Dealer Program Rules. This Agreement incorporates the
Dealer Program Rules attached as Exhibit A ("Dealer Program Rules"). Company
shall have the right to amend the Dealer Program Rules (by addition, deletion,
and/or modification of any terms) from time to time on thirty (30) days written
notice to Dealer, and any such amendment shall be automatically incorporated
into this Agreement.
d. "Independent Parties". In performance of this Agreement,
Dealer shall at all times act in its own capacity and right as an independent
contractor. Company and Dealer acknowledge that their relationship does not
create a general agency, joint venture, partnership, employment relationship, or
franchise between them. Dealer shall not pay, and Dealer acknowledges that it
has not paid, any franchise fee or other compensation for the right to enter
into this Agreement, solicit Subscribers for Company, or use any Marks (defined
herein). Except as expressly set forth herein, neither Company nor Dealer have
the authority to bind the other in any manner. Except as expressly set forth
herein or in the Dealer Program Rules, Dealer will provide all facilities,
equipment, and supplies required to perform its activity and meet its
obligations as contemplated hereunder. Company shall neither direct nor control
the work of Dealer nor assume any responsibility for Dealer's acts, errors, or
omissions. Dealer shall at all times identify Company as the Service provider.
Dealer shall identify itself as an "Authorized Dealer" of Company.
e. No Other Agreements. Dealer represents and warrants to
Company (i) that its execution and performance of this Agreement does not and
will not violate any other contract or obligation to which Dealer or any
Affiliate of Dealer is or was a party, including any covenant not to compete or
agreements concerning non-solicitation of customers or confidential information,
(ii) that it will not disclose to Company, or use or induce Company to use, any
proprietary or confidential information or trade secrets of any other person,
corporation, association, or entity, and (iii) that it has returned all property
and confidential information belonging to all prior employers or service
providers providing any type of product or service competitive with the Service
described herein for whom Dealer may have acted as an employee, agent, or
dealer.
2. COMPANY OBLIGATIONS
During the term of this Agreement, Company agrees (i) to provide
Service in the Area in accordance with the license granted to Company by the
Federal Communications Commission, (ii) to promote the Service in the Area in
such degree as Company in its sole discretion considers necessary, (iii) to
provide training and guidelines (in such amounts and in such frequency as is
provided by Company to other similarly situated dealers) to enable Dealer to
solicit, and submit for consideration, potential Subscribers to the Service, and
(iv) to provide promotional and other advertising materials containing Company's
trade name and other Marks (defined herein) in such types and amounts and under
such terms and conditions as determined
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by Company in its sole discretion, so that Dealer can identify itself as an
authorized dealer of Company and use Company's goodwill to facilitate the
solicitation of Subscribers to the Service.
3. DEALER OBLIGATIONS
a. Ethical Conduct. In all dealings related to this Agreement,
Dealer shall be governed by the highest standards of honesty, integrity, fair
dealing, and ethical conduct. Conduct amounting to a breach hereof includes, but
is not limited to, (i) business practices, conduct, promotions, and advertising
which may be in violation of state or federal law or injurious to Company or its
Affiliates (defined herein), or the business reputation, goodwill, or Marks of
any such entities, or to the general public or any actual or potential
Subscriber, (ii) falsification of any business records, (iii) misrepresentations
to Company, the general public, or any actual or potential Subscriber, (iv)
modification or emulation of any electronic serial number ("ESN") in violation
of any law or regulation (whether state, federal, or otherwise), and (v) the
commission of any illegal act constituting a felony or involving a crime of
moral turpitude or the filing of a criminal indictment or information against
Dealer or any director, officer, or executive of Dealer or any owner controlling
a 10% or greatest interest in Dealer for any such alleged illegal act. Dealer
warrants and agrees that throughout the term of this Agreement it will: (i)
comply with all applicable laws, rules, and regulations, whether federal, state,
or local, (ii) comply with Company's written policies and procedures as
promulgated from time to time as Company deems reasonable for the administration
of its business, and (iii) pay all business, payroll, property, income, sales,
use, and other taxes due upon or in connection with the operation of its
business.
b. Exclusivity. Dealer agrees that, at all times during the
term of this Agreement, Dealer, its Affiliates, their respective Personnel
(defined herein), and any successor entity to Dealer or any Affiliate of Dealer
shall not directly or indirectly offer or sell Wireless Services or assist or
solicit individuals, corporations, associations, or other entities to obtain
Wireless Services in the Area from any person or entity (including any reseller
of Wireless Services) other than Company. Dealer agrees that, during the term of
this Agreement, Dealer, its Affiliates, their respective Personnel, and any
successor entity to Dealer or any Affiliate of Dealer shall not act, directly or
indirectly, as a reseller of Company's Service or of any other Wireless Services
in the Area. The term "Affiliate" shall mean, with respect to any person or
entity, any other person or entity, directly or indirectly, in whole or in part,
owning, controlling, owned by, controlled by, or under common ownership or
control with such person or entity, and specifically includes, without
limitation, National Cellular, Inc. As used in this Agreement, the term
"Wireless Services" means: (i) cellular telephone service, (ii) personal
communications services, (iii) enhanced specialized mobile radio service, and
(iv) any other functionally similar or equivalent wireless voice or data
service, irrespective of the radio frequency band on which the services are
offered.
c. Best Efforts. Dealer shall use its best efforts to promote
and market Company's Service and to identify and refer to Company potential
Subscribers for the Service. Dealer shall use its best efforts to give prompt,
courteous, and efficient service to the general
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public and to actual and potential Subscribers and to protect and promote the
Company's goodwill and business reputation.
d. Subdealers. Dealer may appoint agents or independent
contractors (collectively, "Subdealers") to perform certain services, duties, or
obligations of Dealer under this Agreement or the Dealer Program Rules
(including, without limitation, the solicitation of Subscribers to the Service)
only with the written consent of Company, which may be withdrawn, and under such
terms and conditions as may be required by Company from time to time. Such
consent shall not be unreasonably withheld or withdrawn. Such terms and
conditions may include, without limitation, a requirement that the Subdealer
enter into a separate agreement with Company pertaining to, among other things,
the non-disclosure of Confidential Information (defined herein), exclusivity,
and non-solicitation of Subscribers. Any such appointment will not relieve
Dealer of any of its duties or obligations under this Agreement.
e. Personnel. All obligations and responsibilities to Dealer's
owners, directors, officers, employees, Subdealers, and any other person or
entity that obtains through Dealer the right to solicit Subscribers to the
Service (collectively, "Personnel") shall be those of Dealer. Company shall have
no obligations or responsibilities to such Personnel. Dealer shall cause its
current and future Personnel (including partners and shareholders if such
partners or shareholders own a 10% or greater interest in Dealer) to execute a
Confidentiality, Exclusivity, and Non-solicitation Agreement in the form
attached as Exhibit B, the originals of which shall be delivered to Company upon
request by Company. Dealer shall be fully responsible for all acts and omissions
of its Personnel and shall be strictly and absolutely liable for full compliance
by its Personnel with this Agreement, the Dealer Program Rules, and the
aforementioned Confidentiality, Exclusivity, and Non-solicitation Agreement. A
breach by its Personnel of any of the terms of any such agreements shall be
considered a breach by Dealer and shall entitle Company to pursue all rights and
remedies it may have under this Agreement, at law or in equity. Dealer shall
ensure that all of its sales and service Personnel attend training courses
required by Company relating to the Service or Equipment. Such training shall be
provided by Company at no direct charge to Dealer or its Personnel; provided,
however, that any costs (including, but not limited to, travel and living
expenses) incurred by Dealer or its Personnel in connection with such training
will be the sole responsibility of Dealer or its Personnel. Dealer shall allow
only those Personnel certified by Company or the applicable Equipment
manufacturer(s) or vendor(s) to provide installation, repair, or warranty
services.
f. Locations. Dealer shall operate its business hereunder at
easily accessible retail store-front location(s) ("Locations") which shall be
maintained so as to promote and protect Company's business reputation and
goodwill and shall have ample display room for wireless telephone demonstration
models. Dealer's present Locations are identified on the attached Exhibit C.
Dealer shall notify Company in writing immediately prior to commencing business
operations at any new Location or ceasing business operations at any Location.
The term "Locations" shall also include (without the necessity of amending this
Agreement) any Location that Dealer or any Affiliate of Dealer acquires
subsequent to the execution of this Agreement, regardless of whether or not
Dealer has yet notifier Company of such Location. In addition to the foregoing:
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(i) Dealer shall in good faith carry on its business
diligently and continuously at the Locations during the term of
this Agreement, shall keep the Locations open for business during
normal business hours, shall operate each of the Locations in a
professional, first-class, and reputable manner, and shall
maintain adequate Personnel attendance during normal business
hours; and
(ii) During the term of this Agreement, Company shall
have, and Dealer hereby grants to Company, the right of first
refusal to acquire any interest of Dealer or any Affiliate of
Dealer in any of the Locations prior to any full or partial sale,
lease, sublease, assignment, transfer, or other disposition
(collectively, "Transfer") of such interest by Dealer or any
Affiliate of Dealer. Dealer shall notify Company in writing of the
proposed terms and conditions of the proposed Transfer, and
Company shall have thirty (30) days after receipt of such notice
within which to elect to exercise its right to acquire the
interest on terms substantially equivalent to those of the
proposed Transfer. Company shall have no obligation to exercise
its right of first refusal with respect to any particular
Transfer, and Company's failure to exercise its rights with
respect to any particular Transfer shall not impair Company's
rights with respect to any subsequent Transfer.
g. Records. Dealer shall maintain at its principal place of
business for four (4) years from the date of their preparation or for the period
required by law, whichever is longer, complete and accurate records of its
business conducted pursuant to this Agreement (including, without limitation,
records of actual or potential Subscribers with whom Dealer or its Personnel has
had contact, records of compensation and other amounts paid to Dealer in
connection with Dealer's performance under this Agreement, and records of
Dealer's Equipment sales, leases, installations, and repairs). Dealer shall make
these records available to Company during normal business hours upon seventy-two
(72) hours prior notice.
h. Service Centers. If Company appoints Dealer as an
authorized service center, Dealer shall comply with all requirements, rules, and
regulations of Company relating to authorized service centers, as those rules
may be established or amended by Company from time to time. In the event Dealer
installs or repairs Equipment, Dealer shall comply with all standards,
procedures, and manuals of the appropriate Equipment manufacturers. Dealer's
appointment as an authorized service center shall not constitute or be construed
as a franchise.
4. PROMOTION AND SALE OF SERVICE.
a. Marketing and Promotion. Dealer shall use only Company
authorized rate plans, subscription agreements and forms, and solicitation,
enrollment, and activation procedures in soliciting potential Subscribers to the
Service (as such rate plans, agreements, forms, and procedures may be amended
from time to time upon notice by Company) Dealer shall offer Service rate plans
only to those Subscribers that meet Company eligibility requirements for the
particular service rate plan offered. Dealer shall take all reasonable steps to
confirm the
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accuracy of information obtained from potential Subscribers pursuant to Company
authorized forms and procedures. Dealer shall have no right, power, or authority
to make any representations or warranties regarding the Service except as
expressly directed by Company. Company reserves the right to amend its rate
plans for Service, and to add, delete, suspend, or modify terms and conditions
of the Service at any time.
b. Acceptance of Orders. All orders taken by Dealer for the
Service are subject to acceptance or rejection by Company. If Company does not
accept a potential Subscriber, Dealer may not enter into a subscriber agreement
with or otherwise agree to provide Service to such potential Subscriber. With
respect to the Service, all Subscribers shall be customers of Company and shall
not be considered customers of Dealer.
c. Deposits, Collections, and Billings. Dealer shall, on
behalf of Company, collect deposits and advance payments required by Company
from new Subscribers prior to Service activation. Such deposits and advance
payments shall be made payable to Company only (not to Dealer), and shall be
delivered to Company in accordance with the activation procedures set forth in
the Dealer Program Rules. Company shall be solely responsible for all billings
of Subscribers for Service, and all remittances resulting from such billings
shall be made directly to Company or Company's designee and shall be the
property of Company.
d. Compensation. Subject to the terms of this Agreement and
the Dealer Program Rules, Dealer shall be eligible for compensation from Company
on accepted applications for Service activation procured solely by Dealer or its
Personnel for which Service is activated during the term of this Agreement.
Dealer shall have no right to compensation other than that earned in strict
compliance with this Agreement, the Dealer Program Rules, and Company authorized
procedures. Dealer shall have no right to receive any compensation after the
expiration or termination of this Agreement (whether voluntary or involuntary).
Dealer shall be obligated to reimburse Company for Subscriber deactivations as
set forth in the Dealer Program Rules. The nature, terms, and amount of
compensation shall be in accordance with the Dealer Program Rules, which may be
modified from time to time on thirty (30) days written notice to Dealer. In
addition to Company's right to modify compensation as set forth in this
Agreement and the Dealer Program Rules, Company may establish separate types,
terms, and amounts of compensation for Subscribers to new Service rate plans
introduced by Company after the Effective Date.
e. Offsets. Company shall have the right, at any time, to
offset any amounts owed to Dealer or its Affiliates against any amounts owed by
Dealer or its Affiliates to Company pursuant to this Agreement or otherwise,
including, but not limited to, any costs, claims, expenses, losses, attorney
fees, and damages incurred by Company.
f. Reserve. Upon termination of this Agreement for whatever
reason, Company shall be entitled to establish and withhold a reserve from any
compensation or any other amounts owed to Dealer, which may be used to satisfy
any obligations owed by Dealer to Company, including, but not limited to,
obligations based on Subscriber deactivations following any termination of this
Agreement. The reserve shall equal the average compensation amount
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paid to Dealer per Subscriber during the six (6) months preceding termination,
multiplied by the number of Subscribers whose deactivations resulted in
reimbursement due from Dealer during that period. Any balance remaining in the
reserve after deducting all allowable offer six (6) months after the date of
termination of this Agreement will be paid to Dealer, without interest. The
establishment of this reserve shall not relieve Dealer of its obligation to pay
to Company any amounts owed to Company and not offset against the reserve.
g. Exclusive Rate Plans or Subscribers. Dealer acknowledges
that (i) Company may, from time to time, authorize or restrict Dealer's
solicitation of Subscribers for Service under certain of Company's rate plans,
and (ii) Company may also, from time to time, authorize or restrict Dealer's
solicitation for Service of certain categories of Subscriber or potential
Subscribers as may be identified by Company.
5. THE EQUIPMENT.
a. Minimum Technical Standards. Dealer shall recommend, sell,
lease, or furnish to Subscribers only Equipment that meets minimum FCC and
Company technical standards for regulatory compliance, transmission,
authentication, and overall technical quality. Dealer acknowledges that Company
may refuse Service to any Subscriber or potential Subscriber using Equipment
that does not meet such standards. Dealer further acknowledges that any
Equipment programmed with or utilizing a non-factory installed ESN does not meet
minimum standards.
b. Equipment Sources. Dealer may obtain Equipment for sale or
lease from any supplier so long as the Equipment meets or exceeds the technical
standards described in section 5(a) above. All sales of Equipment by Dealer to
Subscribers and all leases of Equipment to Subscribers where Dealer is the
lessor shall be for Dealer's own account and not as an agent of Company. Dealer
shall be solely responsible for establishing the sales price or rent and other
terms for all such sales and leases of Equipment.
c. Equipment Sold by Company. Company, at its sole option, may
sell Equipment to Dealer for cash, or, if Company so elects, under such credit
terms as Company may extend from time to time. In the event Company elects to
sell Equipment to Dealer on credit, Dealer agrees to execute all documents
necessary to give Company a security interest in such Equipment and to perfect
such security interest, and acknowledges that Company may reduce or cease to
extend such credit at any time at its sole option. Dealer shall bear the risk of
loss for all Equipment in its possession. No agreement by Company to sell
Equipment to Dealer shall constitute or be construed as a franchise.
d. Demonstration Equipment and Service. Company, at its sole
option, may supply Equipment and/or Service to Dealer for purposes of
demonstration to potential Subscribers, under such terms as Company may extend
from time to time. In consideration for Company supplying Equipment to Dealer,
Dealer shall bear the entire risk of loss or damage to such Equipment from the
time Dealer obtains possession of such Equipment until it is delivered
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to a Subscriber or returned to Company. Dealer shall keep all such Equipment
continuously insured under such terms and in such amounts as Company may require
from time to time.
6. GOODWILL.
Dealer acknowledges and agrees that Company has acquired goodwill,
advantages, and benefits as a consequence of Company's substantial investment in
its name, its development and cultivation of a reputation in the Area as a high
quality provider of Service, and the patronage and loyalty of its customers.
Dealer wants to hold itself out to the public as an authorized dealer for
Company and to use Company's goodwill and business reputation to attract and
solicit potential Subscribers to the Service. Dealer acknowledges and agrees
that its use of Company's goodwill and business reputation to solicit customers
and its knowledge and use of Company's Confidential Information (defined herein)
constitute good and sufficient consideration for this Agreement, including the
provisions pertaining to exclusivity, nondisclosure of Confidential Information,
non-solicitation of Subscribers, and the covenant not to compete. Dealer further
acknowledges and agrees that, through its use of the Company's goodwill and
business reputation, it will acquire the names of, and other information
regarding, Subscribers that it solicits for the Service, and that such names and
other information constitute Confidential Information belonging to Company.
Dealer agrees to use its best efforts to protect and promote Company's goodwill
and business reputation and not to use such goodwill or business reputation
except in connection with the promotion and marketing of, and the solicitation
of potential Subscribers for, Company's Service.
7. SERVICE MARKS, TRADEMARKS, AND TRADE NAMES.
Dealer acknowledges and agrees that all service marks, trademarks,
and trade names used by Company (collectively, the "Marks") and the rights to
use such Marks are the exclusive property of Company or are licensed for use by
Company from the owner(s) thereof, and Dealer shall not use any of the Marks
without Company's specific prior written approval. Dealer shall comply with all
rules and procedures pertaining to the Marks prescribed by Company from time to
time (collectively, the "Mark Rules") and shall obtain advance approval from
Company of all advertising or other promotional material which contains any of
the Marks. Subdealers may not use any Marks unless specifically authorized by
Company to do so, and then only in a manner specifically authorized by Company.
This precludes, without limitation, any use of Marks on any collateral,
promotional material, advertising, business cards, or stationary of any
Subdealer. Any unauthorized use of the Marks, or any use not in compliance with
this Agreement or the Mark Rules, by Dealer or its Personnel, including
Subdealers, shall constitute infringement of Company's rights in the Marks, a
material breach of this Agreement, and cause for termination. Dealer
acknowledges that it has no rights in or to the Marks except as provided herein,
and shall not acquire any rights in the Marks or expectancy to their use as a
result of any use of the Marks by Dealer or otherwise. Following the termination
of this Agreement for whatever reason, Dealer shall immediately discontinue use
of all Marks. No authorization to use Company's Marks shall constitute or be
construed as a franchise.
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8. CONFIDENTIAL INFORMATION, NON-SOLICITATION, AND COVENANT NOT TO
COMPLETE.
As more fully set forth in sections 2, 6, and 7 above, in order to
facilitate Dealer's marketing of the Service and solicitation of Subscribers,
Company will permit Dealer to use Company's goodwill, business reputation, and
Marks to attract potential Subscribers, and Company will provide Dealer with
initial and on-going specialized training, education, materials, and/or
information concerning the Service, Subscribers, and Equipment. Through the use
of Company's goodwill, business reputation, Marks, training, materials, and
information, Dealer will acquire the names of, and other information concerning,
Subscribers, other Confidential Information (defined herein), and other
advantages and benefits associated with its business. Dealer specifically agrees
and acknowledge that Subscriber information is confidential, proprietary, and is
not known to the general public or Company's competitors. Dealer further agrees
and acknowledges that the protection it has provided to Company in this section
is a material consideration to Company in entering into this Agreement, and
significant damage would occur to Company if Confidential Information were to
come into the possession of another provider or reseller of Wireless Services or
any dealer, agent, salesperson, or employee thereof. Likewise, if Dealer or any
director, offerer, or Affiliate of Dealer were to work for another provider or
reseller of Wireless Services other than Company as a dealer, subdealer, or
salesperson, or in any other capacity that would allow Dealer to take advantage
of Confidential Information and/or Subscriber contact and/or other advantages or
benefits acquired in connection with Dealer's relationship with Company, Company
would be materially damaged. Because of these special concerns, and to the
fullest extent permitted by law, the following provisions shall apply to Dealer,
its Affiliates, and, as applicable, Dealer's Personnel:
a. Confidential Information. As used in this Agreement,
"Confidential Information" means all information, not generally known to the
public, that relates to the business, marketing, technology, Subscribers,
finances, plans, proposals, or practices of Company, and includes, without
limitation, the identities of all Subscribers and prospects, Subscriber
information, subscribe agreements, dealer agreements, Dealer Program Rules, all
business plans, proposals and practices, all marketing plans, proposals and
practices, all technical plans and proposals, all research and development, all
budgets and projections, all nonpublic financial information, and all
information Company designates as "confidential". All Confidential Information
shall be considered trade secrets of Company and, in addition to the protections
provided herein, shall be entitled to all protections given by law to trade
secrets. The term "Confidential Information" shall apply to information in every
form in which it may exist, whether recorded or not, and, if recorded, whether
recorded on paper, film, tape, computer disk, or any other form or media.
b. Non-Disclosure of Confidential Information. Dealer
covenants and agrees that, both during the term of this Agreement and at all
times thereafter, Dealer, its Affiliates, their respective Personnel, and any
successor entity to Dealer or any Affiliate of Dealer (i) shall not use any
Confidential Information except in connection with the promotion and marketing
of, and the solicitation of Subscribers for, Company's Service, (ii) shall not
disclose to any person, firm, corporation, or other entity any Confidential
Information, (iii) shall not in any other way
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
publicly or privately disseminate any Confidential Information, and (iv) shall
not help anyone else do any of these things. Upon termination of this Agreement,
all Confidential Information (originals and copies) in the possession of Dealer,
any Affiliate of Dealer. their Personnel, or any successor entity to Dealer or
any Affiliate of Dealer shall be immediately returned to Company. Dealer shall
be responsible for ensuring compliance with this subsection by its Personnel and
Affiliates.
c. Non-Solicitation. During the time of this Agreement and for
a period of *** after termination or expiration of this Agreement (whether
voluntary or involuntary), Dealer, its Affiliates, their respective Personnel,
and any successor entity to Dealer or any Affiliate of Dealer shall not at any
time (i) request any Subscriber in the Area that Dealer knows (or has any reason
to know) is a Subscriber of Company to curtail or cancel its Service with
Company, (ii) otherwise divert or attempt to divert any such Subscribers from
patronizing Company or the Service, or (iii) solicit such Subscribers to
purchase Wireless Service from any person or entity other than Company. During
the *** period after termination or expiration of this Agreement, any then
current Subscribers of Company who contact Dealer regarding the Service shall be
referred directly to Company. Dealer shall be responsible for ensuring
compliance with this subsection by its Personnel and Affiliates.
d. Covenant Not to Compete. ***
e. Tolling. The time periods specified in this section shall
be tolled during any period of time during which Dealer is in breach of the
subsection in which the time period is specified.
9. DEFAULT AND TERMINATION.
a. Default. The following events and occurrences shall
constitute defaults of this Agreement: (i) any breach by Company of this
Agreement which Company does not cure or commence to cure within thirty (30)
days after receipt of written notice of such breach from Dealer, (ii) any breach
by Dealer of any of the provisions in sections 3(a), 3(b), 7, or 8 of this
Agreement, (iii) any other breach by Dealer of this Agreement or the Dealer
Program Rules
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which Dealer does not cure within thirty (30) days after sends Dealer written
notice of such breach, (iv) the insolvency of either party, the filing by either
party of a voluntary petition in bankruptcy, the filing of a petition in
bankruptcy against either party, the appointment of a receiver or other
representative for either party or its business or assets, and such situation is
not remedied or corrected within thirty (30) days, or the entry by either party
into any arrangement or assignment for the benefit of creditors, (v) the default
by either party under any other agreement between Dealer or any Affiliate of
Dealer, on the one hand, and Company or any Affiliate of Company, on the other
hand, (vi) the voluntary or involuntary sale, assignment, or other transfer of
Dealer's rights and/or obligations under this Agreement without the prior
written consent of Company, (vii) the voluntary or involuntary sale, assignment,
or other transfer of all or substantially all of Dealer's assets or the control
of Dealer not in the ordinary course of business without the prior written
consent of Company, and (viii) if applicable, the death or incapacity of Dealer.
b. Termination. This Agreement may be terminated for cause by
either party immediately upon the sending of a written notice of termination to
the other party. Termination for cause shall include (i) any termination for a
default as defined in section 9(a) above, and (ii) any termination pursuant to
any termination provision contained in the Dealer Program Rules. Company shall
also have the right to terminate this Agreement immediately upon written notice
to Dealer if Company ceases to provide Service in the Area. Dealer shall have
the right to terminate this Agreement upon written notice to Company within ten
(10) days following a material modification of the Dealer Program Rules. Such
termination will become effective thirty (30) days after Company's receipt of
such notice; provided, however, that if Company rescinds the change prior to the
expiration of such thirty (30) days, this Agreement will not terminate, but
shall continue in full force and effect. Unless sooner "mingled or extended
under the terms herein, this Agreement will terminate five (5) years after the
Effective Date.
1O. MISCELLANEOUS.
a. Limitation of Liability. Under no circumstances shall
Company or Dealer be liable to the other for any indirect, special,
consequential punitive, or exemplary damages as a result of any default or
breach of this Agreement or the termination or non-renewal of this Agreement or
any other event, conduct, act, or omission arising out of or related to the
dealer relationship between Company and Dealer whether based on contract, tort,
statute, or otherwise.
b. Injunction. In addition to any other remedies Company may
have at law, in equity, or pursuant to this Agreement, Company shall have the
option, in appropriate instances, to bring court proceedings to seek injunctive
or other equitable relief to enforce any right, duty, or obligation under this
Agreement. Dealer acknowledges that such injunctive or other equitable relief
will be an appropriate, but not an exclusive, remedy for Company to enforce its
rights under this Agreement, specifically including, but not limited to, its
rights under sections 3(b), 3(f)(ii), 7, and 8 above. Dealer specifically agrees
that, due to the nature of harm which Company would suffer if Dealer were to
breach any of the provisions of sections 3(b), 3(f)(ii), 7, or 8, Company shall
be entitled to, and Dealer hereby consents to, injunctive relief to enforce such
provisions. To obtain injunctive or other equitable relief, Company shall not be
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required to post a bond; or, if required by law or by the court, Dealer hereby
consents to a bond in the lowest amount permitted by law.
c. Indemnity. In the event of a breach of this Agreement
(including any representation or warranty stated herein), the breaching party
shall protect, defend, indemnify, and hold harmless the non-breaching party from
and against any and all liabilities, causes of action, claims, and demands of
every kind against the non-breaching party arising out of or redating to such
breach. In addition, Dealer shall protect, defend, indemnify, and hold harmless
Company (including Company's Affiliates and their directors, officers,
employees, agents, and contractors) from and against any and all costs and
expenses, losses, debts, damages, liabilities, causes of action, claims, and
demands of every kind arising out of or relating to Dealer's performance under
this Agreement, Dealer's operation of the Location(s), or the operation of
Dealer's business, including the business of any Subdealer. It is further agreed
that Dealer will maintain, at its sole cost and expense, any and an insurance
coverage necessary to protect its business and Company from all applicable
risks.
d. Governing Law, Forum, and Costs. This Agreement and the
rights and obligations of the parties hereunder shall be governed by and
construed in accordance with the laws of the State of Texas, without regard to
any rules governing conflicts of laws. Sole and exclusive jurisdiction and venue
for the resolution of any dispute arising between Company and Dealer shall be in
the state or federal courts sitting in Dallas County, Texas. In any legal
proceedings between the parties concerning this Agreement (whether for damage,
equitable relief, or both), the substantially prevailing party shall be entitled
to recover its reasonable costs, including court costs and attorney fees;
provided, however, that this provision shall not entitle any party other than
Company or Dealer to recover than costs.
e. Notices. All notices and other communications hereunder
shall be given in writing and shall be deemed to have been duly given and
effective (i) upon receipt if delivered in person, by cable, telegram, telecopy,
or telex, (ii) one (1) day after deposit with a national overnight express
delivery service (postage prepaid), or (iii) three (3) days after deposit in the
United States mail (registered or certified mail, postage prepaid, return
receipt requested). All notices and other communications hereunder shall be sent
to the following addresses:
If to Dealer: Telephone Warehouse, Inc.
2436 E. Randol Mill Road
Arlington, Texas 76011
Attn: Ron Koonsman
If to Company: AT&T Wireless Services
17300 N. Dallas Parkway
Dallas, Texas 75248
Attn: Dealer Manager
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with copy to: AT&T Wireless Services
Southwest Region Legal Department
5757 Alpha Road, Suite 1000
Dallas Texas 75240
f. Entire Agreement. This Agreement represents the entire
Agreement between the parties hereto with respect to the matters addressed in
this Agreement and, except as expressly provided herein, shell not be affected
by any other documents. All prior agreements, understandings, covenants,
promises, warranties, and representations relating to the matters addressed in
this Agreement are superseded. Notwithstanding the foregoing, this Agreement is
subject to the terms and conditions of the Consent Agreement dated December 20,
1996 by and between Company, Dealer, National Cellular, Inc., HIG Cellular
Acquisition Corporation, and Ron Koonsman.
g. Survival of Obligations. Company's and Dealer's rights and
obligations under sections 7, 8, and 10(a),(b), and (c) of this Agreement (or
any other provision that by its terms reasonably survives termination) and
Dealer's deactivation reimbursement obligations as set forth in the Dealer
Program Rules shall survive the termination of this Agreement. Further, this
Agreement shall govern as to any obligation incurred prior to termination of
this Agreement.
h. Assignment. Dealer acknowledges that Company may assign its
rights and/or obligations hereunder at any time without Dealer's prior approval,
whereupon Company shall be relieved of its obligations hereunder. Dealer may
not, voluntarily or involuntarily, assign, delegate, or otherwise transfer its
rights or obligations hereunder without the prior written consent of Company,
which shall not be unreasonably withheld. This prohibition shall extend to any
disposition or transfer of a controlling interest in the ownership or control of
Dealer and to any disposition or transfer of the assets of Dealer not in the
ordinary course of business, including any transfer by will or operation of law.
To the extent not prohibited hereby, this Agreement shall be binding upon and
inure to the benefit of Company and Dealer and their respective successors and
assigns.
i. Severability and Reformation. If any provision of this
Agreement shall be held invalid under any applicable law, such invalidity shall
not affect any other provision of this Agreement that can be given an effect
without the invalid provision. Further, all terms and conditions of this
Agreement shall be deemed enforceable to the fullest extent permissible under
applicable law, and, when necessary, the court is requested to reform any terms
or conditions necessary to give them such effect.
j. Authority. Company and Dealer each represent and warrant to
the other diet it is duly organized and in good standing in its state of
original organization, it has the requisite approvals to enter into this
Agreement, it is qualified to do business in the State of Texas, and the person
executing this Agreement on its behalf has full authority to execute this
Agreement.
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k. Amendment. Any amendment to this Agreement, other than
amendments to the Dealer Program Rules, shall not be valid unless such amendment
is made in writing and signed by Company's general manager for the Area.
1. No Waiver. No failure by Company to take action on account
of any default or breach of this Agreement or the Dealer Program Rules by Dealer
shall constitute a waiver of any such default or breach, or of the performance
required of Dealer under this Agreement or the Dealer Program Rules.
11. INDEPENDENT INVESTIGATION.
COMPANY AND DEALER ACKNOWLEDGE THEY HAVE READ THIS
AGREEMENT AND UNDERSTAND AND ACCEPT THE TERMS, CONDITIONS, AND COVENANTS
CONTAINED HEREIN AS BEING REASONABLY NECESSARY TO MAINTAIN COMPANY'S HIGH
STANDARDS FOR SERVICE. DEALER ACKNOWLEDGES AND UNDERSTANDS THAT COMPANY OR OTHER
DEALERS MAY AT ANY TIME COMPETE DIRECTLY OR INDIRECTLY WITH DEALER IN SOLICITING
SUBSCRIBERS FOR THE SERVICE OR IN THE SALE, LEASE, INSTALLATION, REPAIR, OR
WARRANTY SERVICING OF EQUIPMENT. DEALER HAS INDEPENDENTLY INVESTIGATED THE
WIRELESS SERVICES AND EQUIPMENT SALE, LEASING, INSTALLATION, OR REPAIR
BUSINESSES AND THE PROFITABILITY (IF ANY) AND RISKS THEREOF. COMPANY HAS NOT
MADE ANY REPRESENTATION OR WARRANTY REGARDING THE PROFITABILITY OR VIABILITY OF
DEALER'S BUSINESS EFFORTS OR THE WIRELESS BUSINESS GENERALLY, AND DEALER IS NOT
RELYING ON ANY REPRESENTATION, GUARANTEE, WARRANTY, OR STATEMENT OF COMPANY
OTHER THAN AS SPECIFICALLY SET FORTH IN THIS AGREEMENT
In witness whereof, the parties have executed this Agreement as of
the Effective Date.
COMPANY: DEALER:
Metroplex Telephone Company Telephone Warehouse, Inc.
d/b/a AT&T Wireless Services
Signature:/s/Gary Fleming Signature:/s/R.L. Koonsman
-------------------- --------------------
Printed Name:Gary Fleming Printed Name: R.L. Koonsman
----------------- -----------------
Title: President Title: President
------------------------ ------------------------
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EXHIBIT A
AT&T WIRELESS SERVICES
DEALER PROGRAM RULES
EFFECTIVE DATE: OCTOBER 1, 1996
(REVISED)
DALLAS METROPOLITAN SERVICE AREA
1. Part of Agreement. These Dealer Program Rules ("Rules") are a part of the
Dealer Agreement (the "Agreement") that has been executed by Company and
Dealer and, except as noted in paragraph 2 below, are to be interpreted
and administered in a manner consistent with the Agreement. These Rules
supersede and replace all prior Dealer Program Rules. These Rules are
subject to amendment at any time by Company upon thirty (30) days written
notice to Dealer.
2. Inconsistencies in Terms. If any inconsistency or conflict exists between
these Rules and the Agreement as amended or any prior Dealer Program
Rules, these Rules control.
3. Definitions. In addition to the terms defined in the Agreement, for
purposes of these Rules, the following terms will have the meanings set
forth below:
Activation Date - The date on which Company commences to provide Service
to the cellular telephone number assigned to a Subscriber.
Subscriber - Each individual, corporation, association, or other entity
that places an order through Dealer for Service that is accepted by
Company and for whom Service is activated. For purposes of computing
commissions, where an individual or entity places more than one order and
each order is for a different cellular telephone number, each order will
be treated as a separate Subscriber if the order is accepted by Company
and if Service is activated on that order. HOwever, if more than one
telephone number is assigned to an ESN, all orders for telephone numbers
assigned to the same ESN count as only one Subscriber. An individual or
entity for whom Service is activated shall NOT be considered a
"Subscriber" if such individual or entity (whether under the same or a
different name) was previously an active Subscriber during the
immediately preceding six-month period or if such activation is connected
with the deactivation of Company's Service on another (or other) cellular
telephone number(s), and Dealer shall not be eligible for compensation of
any kind with respect to such activation (unless the activation qualifies
as a "restore" under paragraph 11 or as otherwise provided in paragraph
13.e). It is the Dealer's responsibility to determine whether an
individual or entity that places an order qualifies as a Subscriber at
the point of sale prior to activation. This is accomplished by
questioning the customer, looking for an account number on the AXYS
system and/or calling Company's Customer Verification.
Dealer Subscribers - For each calendar month, this means the number of
new Subscribers that (i) were submitted by Dealer and accepted by Company
(ii) whose Activation Date was in that month, and (ii) whose Service has
not been terminated for any reason at end of the month.
Deactivated and Deactivation - Termination of Service to the cellular
telephone number assigned to a Subscriber for any reason. The Subscriber
may substitute phones or rate plans without being deactivated as long as
the same phone number is maintained.
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
Vesting Period - The period of time after the Activation Date during
which commissions, bonuses, and other compensation and incentives are
subject to adjustment or reimbursement as provided in these Rules. After
the expiration of the Vesting Period, commissions, bonuses, and other
compensation and incentives not subject to adjustment or reimbursement
unless obtained in violation of these Rules, the Agreement, or Company
authorized procedures.
4. ***
5. ***
6. ***
7. ***
8. ***
9. ***
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
***
10. ***
11. ***
3
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
12. ***
13. ***
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
***
14. ***
15. ***
16. ***
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
ASTERISKS DENOTE SUCH OMISSIONS.
17. ***
18. Previous Subscribers. Compensation will be paid with respect to a
Subscriber whose Activation Date preceded the effective date of these
Rules based on the Dealer Program Rules which were in effect on the
Subscriber's Activation Date.
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DEALER PROGRAM RULES RECEIPT
I acknowledge that I have received a copy of the Dealer Program Rules with an
effective date of October 1, 1996.
12-31-96
- ------------------------------------
(Date)
/s/Telephone Warehouse
- ------------------------------------
(Dealer Name)
/s/R. Koonsman
- ------------------------------------
(Signature)
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EXHIBIT "B"
CONFIDENTIALITY, EXCLUSIVITY, AND NON-SOLICITATION AGREEMENT
I, [EMPLOYEE/OFFICER NAME], AM A(N) [POSITION] OF [DEALER
NAME]("Dealer"), an authorized dealer of ________________________d/b/a AT&T
Wireless Services ("Company") to solicit and submit for consideration potential
Subscribers to the wireless telecommunications services ("Services") provided by
Company in the _____________________area ("Area"). The Area is defined by the
United States Census Bureau and consists of the following counties:
______________. Because of my relationship with Dealer and Dealer's relationship
with Company, I will receive knowledge, experience, and training concerning
wireless" telephone systems and equipment, including the Service and system of
Company, and will have contact with Company's Subscribers, and as a result I
will receive financial benefits through my relationship with Dealer. As used in
this Agreement, the term "Subscribers" means all subscribers to the Company's
Service who I learn about during or because of my relationship with Dealer, or
who have had any dealings or communication with Dealer at any time. As wed in
this Agreement, "Confidential Information" means all information, not generally
known to the public, that relates to the business, marketing, technology,
Subscribers, finances, plans, proposals or practices of Company, and it Dudes,
without limitation, the identities of all Subscribers and prospects, subscribe
agreements, dealer agreements, Dealer Program Rules, all business plans,
proposals and practices, all marketing plans, proposals and practical, all
technical plans and proposals, all research and development, All budgets and
projections, all nonpublic financial information, and all information Company
designates as "confidential." In return for such knowledge, experience,
training, and financial benefits, and in addition to other agreements of Dealer,
to the fullest extent permitted by law, I agree to do all of the following:
1. I agree that,while I am associated with Dealer and while
Dealer is an authorized dealer of Company, I will act according to the
highest standards of honesty, integrity, fair dealing, and ethical
conduct in all my dealings with Subscribers, potential Subscribers, and
Company. I Agree that a breach of this section includes, but is not
limited to, the making of misrepresentations or misleading statements to
Company or to any actual or potential Subscriber.
2. I agree to keep confidential all information defined as
"Confidential Information" above, and agree not to disclose to anyone Use
or to any other business such Confidential Information. I understand and
agree that all such Confidential Information constitutes trade secrets of
Company.
3. I agree that, while I am associated with Dealer and while
Dealer is an authorized dealer of Company, I will not solicit business
for any other Wireless Service Provider, and I will not help any other
Wireless Services Provider obtain business. As used herein, the term
"Wireless Service Provider" shall mean any provider, reseller, dealer,
subdealer, salesperson, or agent thereof of the following: (i) cellular
telephone
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service, (ii) personal communications services, (iii) enhanced
specialized mobile radio service, or (iv) any other functionally similar
or equivalent wireless voice or data service.
4. I agree that, for a period of one (1) year after the
termination of my association with Dealer or Dealer's association with
Company, whichever occurs first, I shall not request any Subscriber in
the Area whom I know to be a Subscriber to cancel his, her, or its
Service with Company, nor shall I solicit, divert, or try to divert any
Subscribers to another Wireless Services Providers, nor shall I help any
other Wireless Service Provider obtain or try to obtain any business from
any of these Subscribers. During this one-year period, if any
then-current Subscribers contact me about the Service, I will refer each
of them to Company.
5. I agree that Company is a third-party beneficiary of this
Agreement and shall be entitled to enforce this Agreement. If I break any
of my promises in this Agreement, I realize I can be used in court by
Company or by Dealer and be held liable for money damages or I can be
subject to injunctive or other equitable relief in favor of Company. I
also agree that, if any legal proceedings are bought concerning this
Agreement, the substantially prevailing party will be entitled to recover
all costs and reasonable attorney fees.
6. Each of the provisions of this Agreement is independent of
the other provisions of this Agreement. If a court of competent
jurisdiction decides that any part of this Agreement is unenforceable, I
agree to be bound by any lesser covenant that would impose the maximum
duty permitted by law, if such lesser covenant were separately stated in
this Agreement. This Agreement may be reformed to be enforceable to the
fullest extent permitted by law.
DATED: _____________________, 199___.
DEALER: OWNER, DIRECTOR, OFFICER,
EMPLOYEE, AGENT, OR
SUBDEALER OF DEALER:
- ------------------------------- ----------------------------------------
Signature: Signature:
--------------------- -------------------------------
Printed Name: Printed Name:
------------------ ----------------------------
Title: Title:
------------------------- ----------------------------------
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