NON EXCLUSIVE AGREEMENT
Exhibit 10.2
INTERNET-BASED
SALES
NON-EXCLUSIVE
AUTHORIZED AGENCY
AGREEMENT
BETWEEN
CINGULAR WIRELESS,
LLC,
d/b/a CINGULAR
WIRELESS
AND
INPHONIC, INC
Exhibits
Exhibit A - Area
Exhibit B - Authorized Cingular
Services
Exhibit C - Compensation
Exhibit D - Omitted Intentionally
Exhibit E - Omitted Intentionally
Exhibit F - Nondiscrimination Compliance
Agreement
Exhibit G - Omitted Intentionally
Exhibit H - Cingular Agent Operations
Manual
Exhibit I - Cingular Equipment Return
Policy
Exhibit J - Subagents
Exhibit K - Electronic Signature requirements
for electronic commerce
THIS AUTHORIZED AGENCY AGREEMENT, effective
August 1, 2003 (the “Agreement”) is between
Cingular Wireless, LLC, doing business as Cingular Wireless
(“Cingular”) and InPhonic, Inc., a Delaware Corporation
(“Agent”).
RECITALS:
Whereas, Cingular is involved in the
development, establishment and sale of Wireless Communications
Service (“WCS”) which requires the use by WCS
subscribers (“Subscribers”) of personal communications
equipment (“Equipment”); and
Whereas, Cingular operates a WCS
system in the geographic service area(s) defined in this Agreement,
and desires to provide WCS in these areas to Subscribers through
authorized agents, Resellers, distributors, retailers, direct sales
and other channels of distribution; and
Whereas, Cingular has adopted and
used or intends to adopt and use certain valuable trademarks and
service marks, symbols, logos and other identifying indicia
(“Marks”) in the provision of its WCS and Equipment;
and
Whereas, Agent is desirous of
selling Cingular’s WCS as an Authorized Agent of Cingular and
is desirous of selling Equipment, and providing basic Equipment
testing/troubleshooting service for Subscribers to utilize WCS;
and
1
NON EXCLUSIVE AGREEMENT
Whereas, Cingular and Agent further
agree that Agent shall sell or lease, and shall provide testing and
troubleshooting services for Equipment, and shall be licensed to
use certain Marks in its business operations, as more specifically
detailed hereinafter.
Now, therefore, in consideration of
the mutual promises herein contained, it is hereby agreed as
follows:
1. Definitions
“ Activation ” or
“ Activated ” - means the initiation of
Cingular’s WCS in a Subscriber’s Equipment.
“ Affiliate ” - a
Person is an affiliate of an entity that directly or indirectly,
through one or more intermediaries, controls, is controlled by or
is under common control with such Person.
“ Area ” - means
the geographic area described on Exhibit A, in which Cingular
markets WCS.
“ Authorized Cingular
Services ” - means those services provided by Cingular
that Agent is authorized hereunder to sell on behalf of Cingular,
including WCS, and any other services set forth on Exhibit B, as
amended in writing from time to time by the parties.
“ Churn ” - means
a measurement of Subscriber turnover that takes into consideration
the number of current subscribers activated by Agent, and the
number of Subscribers Activated by Agent who have terminated WCS
Service, or have had their WCS account terminated, cancelled or
suspended by Cingular, including but not limited to, termination or
suspension for failure to pay charges when due. The formula and
time frames for calculating Churn may be revised from time to
time.
“ Equipment ” -
means the personal communications equipment needed for using
WCS.
“ CMRS ” or
“ Commercial Mobile Radio Services ” - means any
and all services that: (A) fit the definition of commercial mobile
services pursuant to Section 332 of the Communications Act, (47
U.S.C. § 332); (B) are subject to regulation as Commercial
Mobile Radio Services by the FCC under the orders set forth in
implementation of Sections 3(n) and 332 of the Communications Act;
Regulatory Treatment of Mobile Services (cc Docket No. 930252) or
such other orders or rules as may be in effect from time to time;
or (C) are the functional equivalent of a commercial mobile service
as defined in 47 U.S.C. § 332. CMRS shall in any event include
all forms of specialized mobile radio service (SMR and ESMR),
cellular service, personal communications services and one and two
way communication services provided by a communication common
carrier and commonly referred to as paging services.
“ CPNI ” or
“ Customer Proprietary Network Information ” -
means “customer proprietary network information” as
that term is defined in Section 222 of the Telecommunications Act
(47 U.S.C. § 222).
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NON EXCLUSIVE AGREEMENT
“ Marks ” - means
any and all trademarks, service marks, trade names, insignia,
symbols, logos, or decorative designs, which Cingular owns, or is
licensed or sublicensed to use, in connection with WCS or products
relating thereto.
“ Paging Services
” - means paging services as defined in Section 22.99 of the
Telecommunications Act (47 CFR § 22.99)
“ Person ” -
means any person, association, partnership, co-partnership,
corporation, joint stock company, trust, or other entity however
organized.
“ Reseller ” -
means any Person that purchases bulk quantities of CMRS from a CMRS
carrier for resale distribution, directly or indirectly, to
ultimate users of CMRS, which users become Reseller’s
customers, and not the customers of the underlying CMRS
carrier.
“ Subscriber ” -
means any customer enrolled by Agent and whose WCS is Activated,
provided that each WCS telephone number assigned to a customer of
Cingular’s WCS is deemed to be a separate Subscriber,
regardless of how many WCS telephone numbers may be assigned to or
used by any one customer.
“ Subscriber List
Information ” - means “subscriber list
information” as defined in Section 222 of the
Telecommunications Act (47 U.S.C. § 222).
“ Successor ” -
means any Person that succeeds to or acquires the rights, title or
interests of another.
“ WCS ” - means
any and all the CMRS services provided by Cingular in the
Area.
2. Acknowledgments and
Representations
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a)
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Cingular and
Agent acknowledge that they have read this Agreement and understand
and accept the terms, conditions and covenants contained herein as
being reasonable and necessary to maintain Cingular’s high
standards for WCS and thereby protect and preserve the goodwill of
Cingular’s WCS and its Marks.
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b)
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Agent
acknowledges that Cingular’s ability to operate a WCS system
is conditioned upon the continuing validity of a FCC license. Agent
recognizes that Cingular’s ability to operate a WCS system
may be affected by state and federal court decisions, state and
federal regulatory approvals, and/or the maintenance of necessary
contractual arrangements. Agent agrees that if Cingular is
prohibited from, or otherwise ceases, selling WCS in the Area,
Cingular may declare this Agreement, or any part herein, null and
void with no penalty.
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c)
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Cingular
expressly disclaims the making of, and Agent acknowledges that it
has not received or relied upon, any representation as to the gross
compensation or revenue that it may earn as a result of its agency
relationship with Cingular and acknowledges that it has no
knowledge of any representations relating to its agency
relationship with Cingular by an officer, employee or agent of
Cingular that are contrary to the terms herein. Agent has made
material representations to Cingular in its application for
appointment as an authorized Agent of Cingular and Cingular has
relied upon such representations as a material inducement to enter
into this Agreement with Agent.
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3
NON EXCLUSIVE AGREEMENT
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d)
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Agent and
Cingular mutually agree that they shall not have any liability to
the other for any special, consequential, incidental, or indirect
damages, or lost profits or revenues, even if advised of the
possibility of such damages.
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3. Relationships of the Parties
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a)
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Subject to all
of the terms and conditions herein, Agent shall, within the Area,
solicit and contract subscribers for Authorized Cingular
Services.
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b)
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Agent
acknowledges that this is a nonexclusive agreement with respect to
Cingular and Cingular expressly reserves the right without
obligation or liability to Agent, to market in the same Area served
by Agent, Authorized Cingular Services, any other Cingular WCS and
Equipment, and any other products and services offered by Cingular
or its Affiliates, whether through Cingular’s own
representatives or through others including, but not limited to,
other authorized exclusive or nonexclusive agents, exclusive or
nonexclusive dealers, as well as Resellers, distributors, and
retailers. Cingular also reserves the right to alter, or subtract
from the Authorized Cingular Services set forth in Exhibit B at any
time and for any reason and shall provide as much prior notice as
reasonably possible. Agent also acknowledges and understands that
Cingular or its Affiliates may establish other retail or wholesale
locations within the Area which offer products or services of
Cingular (or its Affiliates) which may be in competition with
Agent.
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c)
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Agent
acknowledges and agrees that Agent has been engaged to sell WCS at
the rates that Cingular publishes in its rate plan brochures as
revised from time to time (the “Published Rates”).
Agent does not have the authority to vary the Published Rates or
any terms of WCS as determined by Cingular from time to time.
Further, Agent does not have the authority under this agreement,
unless specifically authorized in writing by Cingular, to Activate
individual lines on behalf of anyone qualifying to receive the
rates set out in a competitive bid by Cingular.
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d)
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In the Area,
Agent shall operate in accordance with such standards as Cingular
may from time to time prescribe for Internet-Based distribution.
The current standards are attached hereto as Exhibit K. Agent
acknowledges and agrees that this Agreement does not authorize
Agent to make sales via telemarketing.
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e)
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Agent
acknowledges and agrees that its sole relationship with Cingular
with respect to the Area is as described herein, and that during
the term of this Agreement it shall not have any other direct or
indirect relationship with Cingular, including but not limited to,
as a Reseller of Cingular’s WCS.
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f)
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Upon enrollment
of a particular Subscriber, such Subscriber shall become a customer
of Cingular, and Cingular shall offer and furnish such customer
billing services as Cingular deems appropriate. Cingular shall be
responsible for collection of any charges for WCS from
Subscribers.
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4
NON EXCLUSIVE AGREEMENT
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g)
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With the sole
exception of selling Authorized Cingular Services to Subscribers
enrolled by Agent for the account of Cingular with respect to which
Agent acts as an agent of Cingular and owes Cingular the fiduciary
and other obligations of an agent to its principal, Cingular and
Agent acknowledge and agree that their agency relationship arising
from this Agreement does not constitute or create a general agency,
joint venture, partnership, employment relationship or franchise
between them.
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h)
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Agent hereby
represents that Agent is engaged in an independent business and
will perform its obligations under this Agreement as an independent
contractor and not as the employee or agent of Cingular (except as
noted in the previous paragraph); that the Persons performing
Services hereunder are not employees or agents of Cingular; that
Agent has and hereby retains the right to exercise full control of
and supervision over the performance of Agent’s obligations
hereunder and full control over the employment, direction,
compensation and discharge of all employees, contractors or agents
of Agent assisting in the performance of such obligations; that
Agent will be solely responsible for all matters relating to
payment of such employees, contractors or agents, including
compliance with workers’ compensation, unemployment,
disability insurance, social security, withholding and all other
federal, state and local laws, rules and regulations governing such
matters; and that Agent will be responsible for Agent’s own
acts and those of Agent’s employees, contractors and agents
during the performance of Agent’s obligations under this
Agreement.
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i)
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Agent
acknowledges that compensation paid and other terms and conditions
for adding Subscribers to Cingular’s services may vary among
agents and other distributors of Cingular’s services in
Cingular’s sole discretion.
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4. Relationship with Sub-Agents
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a)
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Agent may enter
into agreements with any Person (subject to the conditions stated
herein) to sell Cingular’s Authorized Cingular Services on
behalf of Agent (“Sub-Agent”). Agent shall provide
Cingular with prior written request, including such information as
Cingular shall require from time to time, of its desire to contract
with a subagent. Agent shall not enter into any agreement with a
Sub-Agent until Cingular has approved such Sub-Agent.
Notwithstanding anything herein, Cingular shall have the right to
disapprove at any time any previously approved Sub-Agent, and Agent
shall immediately terminate its Sub-Agency relationship with such
Sub-Agents. All approved Sub-Agents shall be listed in Exhibit J
(Sub-Agents), as amended in writing from time to time by the
parties. Agent shall have provisions in its agreement with all
Sub-Agents allowing Agent to terminate its relationship with any
Sub-Agent Cingular has notified Agent is disapproved. Upon request
of Cingular, Agent shall provide a list of all
Sub-Agents.
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b)
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Cingular shall
have the right to require the immediate removal of any Sub-Agent
whose acts or omissions would, if committed or omitted by Agent,
constitute a breach of, or default under, this Agreement by Agent.
In the event of any such Sub-Agent act or omission, Cingular shall
have the additional right, notwithstanding anything to the contrary
herein, to rescind Agent’s right to operate through such
Sub-Agent.
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5
NON EXCLUSIVE AGREEMENT
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c)
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Agent
understands and agrees that Sub-Agents of Agent shall not be
permitted to use Cingular Marks in any manner whatsoever. Any
unauthorized use of Cingular Marks by a Sub-Agent shall be grounds
for immediate termination of this Agreement, in addition to
Cingular’s right to any other remedies under law or
equity.
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d)
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Agent may not
delegate its responsibilities under this Agreement to any
Sub-Agent, and shall remain liable to Cingular pursuant to the
terms of this Agreement for any act or omission of a Sub-Agent
notwithstanding any agreement with a Sub-Agent. Agent shall
indemnify, defend and hold Cingular harmless for the acts or
omissions of any Sub-Agents or any breach of this Agreement by any
Sub-Agents.
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e)
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Notwithstanding
anything herein to the contrary, if Agent breaches any provision in
this Section 4, Cingular’s remedies shall include, but not be
limited to:
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i)
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rescinding
Agent’s right to operate through Sub-Agents,
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ii)
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suspension of
compensation due Agent for Subscribers activated through
Sub-Agent;
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iii)
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immediate
termination of this Agreement.
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5. Agent Responsibilities
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a)
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Agent agrees to
provide sufficient personnel, materials and advertising to actively
promote Authorized Cingular Services in a quality manner, and to
maintain appropriate Web Site to enhance the sale of Authorized
Cingular Services.
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b)
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Agent will
offer Authorized Cingular Services to Subscribers subject to all of
the applicable terms and conditions of Cingular’s then most
current form of contract for customers.
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c)
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Agent agrees to
maintain sufficient workers compensation insurance and Commercial
General Liability (“CGL”) insurance to protect Cingular
and its Affiliates from all claims of liabilities arising out of or
in connection with this Agreement or Agent’s performance
under this Agreement, including but not limited to the acts,
omissions, and/or representations of Agent and its officers,
employees and representatives. Cingular and its Affiliates shall be
named as “additional insureds” on each CGL policy, and
each workers compensation insurance policy and/or CGL policy shall
contain a waiver of subrogation clause. Such insurance coverage
shall be maintained under one or more policies of insurance from a
recognized insurance company qualified to do business within the
Area providing minimum liability protection of one million dollars
($1,000,000) per occurrence for bodily and personal injury and
death and one million dollars ($1,000,000) per occurrence of
property damage. Each such insurance policy shall provide for not
less than thirty (30) days prior notice to all insureds of any
modifications, cancellation or non-renewal. Cingular may, at any
time and with ninety (90) days prior notice to Agent, require Agent
to increase its coverage of any type of insurance in reasonable
amounts and to require different or additional kinds of insurance,
to reasonably reflect inflation, identification of special risks,
changes in law or standards of liability, higher damage awards or
other reasonable changes in circumstances. Upon request by
Cingular, Agent shall furnish proof satisfactory to Cingular that
insurance coverage required hereunder is in force.
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6
NON EXCLUSIVE AGREEMENT
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d)
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Agent agrees to
maintain operations and follow procedures that are in full
compliance with Cingular’s requirements as specified in
Cingular’s manuals and training guides as may be amended and
distributed from time to time, and to allow Cingular reasonable
access to Agent’s facilities for inspection. Agent shall
collect from Subscribers as directed by Cingular, deposits securing
the Subscriber’s payment for service. Agent shall have no
claim to any such deposits collected. In the event that Agent fails
to collect deposits from Subscribers as directed by Cingular,
Cingular may offset such un-remitted deposits against any amount
owed by Cingular to Agent. Cingular shall collect deposit amounts
from Agent through deductions from commissions and other payments
owed by Cingular to Agent. Notwithstanding that any deposit amount
was collected from Agent through an offset, Agent shall have no
claim against such deposit and it shall be refundable only to the
Subscriber on whose behalf the deposit was, or should have been,
collected. Agent agrees that it may be required to supply certain
computer equipment necessary to interact with Cingular’s
systems for the purpose of Activating Subscribers and for accessing
Subscriber accounts for purposes of providing customer service. The
Cingular Agent Operations Manual, as amended from time to time, is
binding upon Agent as if fully set forth herein. The current
version of the Cingular Agent Operations Manual is attached as
Exhibit H.
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e)
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Agent agrees
that if Cingular in its sole discretion should provide access to
any of Cingular’s systems for purposes of Activating
Subscribers, or accessing Subscribers accounts, that Agent shall
only use such access for the purpose authorized explicitly in
writing by Cingular. Should Cingular provide any equipment to be
used for such purpose, Agent agrees that such equipment shall
remain the property of Cingular. Should Cingular provide any
software for use in connection with such equipment, Agent agrees
that such software shall be subject to a separate license
agreement.
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f)
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For its own
account, Agent agrees to sell or lease Equipment to be used by
Subscribers of Cingular’s WCS. Agent may only offer FCC
approved equipment. Agent agrees to maintain an inventory of
Equipment sufficient to meet reasonable anticipated demand by
Subscribers, which Agent enrolls. In particular, but without
limitation, Agent agrees not to use any Equipment bearing
trademarks similar to or resembling the Marks of Cingular without
the express written approval of Cingular. Except for any
Cingular-owned Equipment which Agent handles on behalf of Cingular,
all Equipment sales and leases shall be made by or on behalf of
Agent for its own account and not as Agent for, or for the account
of, Cingular. Agent may establish sale and lease prices, fees and
charges for the Equipment and Cingular shall have no control over
such prices or over Agent’s Equipment. Notwithstanding the
foregoing, Agent shall comply with Cingular’s Equipment
Return Policy, attached hereto as Exhibit I and as amended from
time to time in Cingular’s discretion. With respect to the
sale or lease of Agent’s Equipment, Subscribers shall be
customers of Agent and Cingular shall have no responsibility to
Agent or to Subscribers with respect to the sale or lease of
Agent’s Equipment.
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7
NON EXCLUSIVE AGREEMENT
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g)
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Agent agrees
that all Equipment sold by Agent for use with Cingular’s
service shall conform to such standards of hardware and software as
Cingular may prescribe from time to time. Agent acknowledges that
such requirements may preclude Agent from selling Equipment that is
approved by the FCC for use on Cingular’s service, may
require certain types or Equipment for use with certain plans, or
may require preloading software or data in the Equipment. By way of
illustration, and not limitation, Cingular may require Agent to
sell Equipment that is capable of operating on both
Cingular’s TDMA and GSM systems (“GAIT
Equipment”), and has been preloaded with the Intelligent
Roamer Data Base specifying the systems on with the Equipment will
operate when outside the geographic area in which it was activated;
Cingular may prohibit the sale of TDMA Equipment in geographic
areas in which Cingular operates both a GSM and TDMA wireless
system; or Cingular may require the sale of Equipment that is
capable of accessing Cingular’s GPRS system.
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h)
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Agent agrees to
take all necessary steps to ensure compliance with Agent
obligations under the Agreement by Agent and its personnel and any
other parties involved in the sale of the Authorized Cingular
Services by Agent.
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i)
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Agent agree
that it will at all times, faithfully, honestly and diligently,
perform its obligations hereunder, and that Agent will continuously
exert its best efforts to promote and enhance the use of
Cingular’s Authorized Cingular Services.
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j)
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Agent agrees
that during and after the term of this Agreement, Agent will not
reveal, divulge, make known, sell, exchange, give away, or transfer
in any way any CPNI, or any other information regarding Cingular
Subscribers obtained by it in connection with its relationship with
Cingular to any Person other than Cingular except with the express
written permission of Cingular or as required under Section 222 of
the Telecommunications Act or other applicable law. Agent shall use
CPNI and/or any other information regarding Cingular Subscribers
obtained in connection with its relationship as Agent solely for
the purposes of:
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i)
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marketing
additional Authorized Cingular Services to Cingular Subscribers
consistent with the terms of this Agreement,
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ii)
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Agent (but no
Successor) maintaining periodic contact with Subscribers as
required for warranty service, installation or maintenance of
Equipment, and
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iii)
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the resolution
of disputes between Agent (but no other corporate entity) and
Subscribers relating to Equipment charges.
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k)
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Any use by
Agent of CPNI is subject to the orders, rules and regulations
promulgated by the FCC and if any use as outlined in this paragraph
is determined to be in conflict with an FCC order, rule or
regulation, Cingular may require such use to cease
immediately.
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l)
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Agent agrees to
advertise association with Cingular’s Authorized Cingular
Services as an authorized Agent of Cingular, pursuant to any
written procedures Cingular may publish from time to
time.
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8
NON EXCLUSIVE AGREEMENT
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m)
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Agent agrees
that it will not allow any other Person to use its agent
code(s).
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6. Cingular’s
Responsibilities
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a)
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Subject to
Cingular’s ability to provide WCS in connection with
necessary licenses and regulatory approvals and the continuing
validity of such necessary licenses and regulatory approvals, and
subject to compliance with Cingular’s procedures and
guidelines established from time to time, Cingular agrees to
provide the Authorized Cingular Services to Subscribers solicited
by Agent in accordance with this Agreement.
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b)
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Cingular shall
establish the rates, terms and conditions of the sale of its
Authorized Cingular Services to Subscribers, which rates, terms and
conditions shall be subject to change upon notice by
Cingular.
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c)
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Cingular shall
establish the administrative procedures and guidelines for sale of
Authorized Cingular Services, enrollment of Subscribers and
customer service provided to Subscribers. Such procedures and
guidelines may include a requirement that Agent provide certain
equipment necessary to Activate Subscribers or to access
Cingular’s systems so as to provide customer service to
Subscribers.
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d)
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Cingular agrees
to promote and advertise Authorized Cingular Services and provide
promotional literature from time to time as Cingular deems
necessary and appropriate.
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e)
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Cingular agrees
to bill Subscribers for Authorized Cingular Service(s) charges and
provide customer service and assistance with respect to collection
of Authorized Cingular Service charges, and provide such other
customer service and assistance deemed necessary or appropriate by
Cingular.
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7. CPE Bearing Cingular’s
Marks
Agent shall be prohibited (unless
Cingular agrees otherwise in writing) from selling Equipment which
bears Cingular’s Marks to any Person other than a Subscriber
to whom Agent has sold Authorized Cingular Service(s) hereunder.
This clause is intended to protect Cingular’s Marks and to
assure that such Marks are used properly.
8. Compensation
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a)
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Agent shall be compensated as
provided on Exhibit C. Notwithstanding anything herein, or on
Exhibit C to the contrary, Cingular may from time to time revise
existing rate plans, or introduce special rate plans for which
compensation shall be different than as set out on Exhibit C.
Examples of special rate plans include, but are not limited to
plans designed for business customers, data only plans, and
FamilyTalk Plans. In order to be compensated for activating
Subscribers on such revised or special rate plans, Agent must agree
in writing to accept such different compensation. In the event
Agent fails to agree to accept such different compensation, but
nonetheless activates Subscribers on such revised or special plans,
Agent shall be deemed to have accepted the different compensation
and all terms and conditions applicable thereto. In the event Agent
fails to agree to accept such different compensation but
Subscribers switch to such revised or
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9
NON EXCLUSIVE AGREEMENT
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special plans
within the Vesting Period (as defined below) no compensation shall
be payable. Commissions and other compensation payments shall only
be earned as long as this Agreement is in effect, and the
expiration or termination of this Agreement shall terminate
Agent’s right to earn any further commission, compensation,
fee, bonuses, or other such future payment that might otherwise be
earned if this Agreement had not terminated or expired.
Notwithstanding the foregoing in this Section 8.a), where the
Subscriber satisfies the Vesting Period (as defined in Exhibit C)
prior to the expiration or termination of this Agreement, the
Activation Commission shall be paid to Agent by CINGULAR even
though this Agreement has expired or been terminated. Activation
Commissions in which the Subscriber fails to satisfy the Vesting
Period either before or following this Agreement’s expiration
or termination, shall be charged-back to Agent (or paid by Agent to
CINGULAR in cash within 30 days of CINGULAR’s request for
payment) even though this Agreement has expired or been
terminated.
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b)
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An Activation
Commission shall be earned and paid for each qualified Subscriber
enrolled by Agent for Authorized Cingular Services during the term
of this Agreement, subject to the conditions set forth herein. A
Subscriber will be deemed enrolled only when i) the Subscriber has
been accepted by Cingular, ii) the Subscriber’s WCS telephone
number has been Activated in the Equipment, and iii) the Subscriber
remains on the Service for the Vesting Period. An Activation
Commission shall not be considered earned by Agent in the event a
Subscriber does not remain continuously active on Cingular’s
system during the Vesting Period regardless of whether the
Activation Commission was previously paid by Cingular for that
Subscriber.
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c)
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If any
Subscriber’s Service is discontinued prior to satisfying the
Vesting Period and Cingular has already paid Agent the Activation
Commission, an equipment rebate, a cooperative advertising payment,
a SPIFF, or any other payment made in connection with the
activation of a Subscriber (“Activation Payments”),
prior to such Service discontinuance, Cingular will be entitled to
deduct (in the form of a charge-back) the Activation Payments
previously paid, from any future payments due and owing to Agent.
Agent understands that such discontinuance may arise from the
Subscriber’s election to deactivate Service or, from
Cingular’s deactivation of Service for that Subscriber. Any
Cingular deactivation of Subscriber Service shall arise only for
cause. Cingular’s deactivation of a Subscriber’s
Service “for cause” may arise from, but not necessarily
be limited to the following events: Subscriber credit problems,
failure or delay in Subscriber payment for Service, Subscriber
fraud or misuse of Equipment or Cingular’s WCS, or
Subscriber’s breach of any of Cingular’s terms and
conditions of Service. Agent acknowledges and agrees that Cingular
may grant Subscribers fifteen (15) days, or such other period as
Cingular may determine in its sole discretion, during which
Subscribers may cancel agreements without incurring termination
fees, including agreements obligating the Subscriber to purchase
the Authorized Cingular Services for a period of months or years.
Agent agrees that Agent shall not require Subscribers to enter into
contractual relationships directly with Agent that create
obligations for the Subscriber who terminates Authorized Cingular
Services pursuant to Cingular policies or that are otherwise
inconsistent with Cingular’s policies.
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10
NON EXCLUSIVE AGREEMENT
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d)
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Agent must
provide Cingular with all Subscriber sales information, including
all back-up documentation, the date of sale, description of the
Equipment and a copy of the Subscriber’s service order
completed by Agent which shall specify, among other pertinent
information, the Subscriber’s WCS phone number. Agent shall
maintain and, upon request, provide to Cingular full, accurate and
complete back-up documentation covering each Subscriber. In the
event that Cingular pays compensation prior to the receipt of such
documentation, and such documentation is not subsequently provided
within five (5) days of Cingular’s request, Cingular may
deduct such previously paid compensation as a charge-back from
future compensation due Agent.
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e)
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In the event
that charge-backs made by Cingular exceed the amount to be paid
Agent during the same month, Cingular may, at its option, deduct
those charge-backs from moneys due Agent in subsequent months. In
the event Cingular determines in its reasonably exercised
discretion that Agent is likely to cease doing business, Cingular
may withhold sufficient compensation to cover anticipated
charge-backs after Agent ceases to do business. If this Agreement
expires or is terminated, and there is not sufficient money due
Agent to cover the amount of Cingular charge-backs, Agent shall be
required to refund to Cingular the remaining balance of the
charge-backs in cash within 30 days of written request.
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f)
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Upon reasonable
advance notice, Agent and Cingular or their designated
representatives shall each have access during normal business hours
to all pertinent books and records of the other relating to the
obligations of the parties under this Agreement, including but not
limited to, records of Activations, deactivations, and Activation
Commission accounts, for the purpose of verifying that all
Activation Commissions have been properly earned, credited and
paid.
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g)
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Agent agrees
that if Cingular identifies a situation in which Agent’s
activities violate this Agreement, Cingular may (i) withhold
payment of compensation amounts applicable to the numbers under
investigation during the investigation of activities and/or (ii)
require Agent to cease all activities hereunder.
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h)
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In addition to
any other limitations set forth herein, no Activation Commission,
Co-op payment, rebate, or other compensation otherwise due shall be
paid to Agent for any WCS or Equipment sold:
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ii)
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by another
Cingular agent,
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iii)
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by any other
Person including another authorized sales
representative,
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iv)
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in a
fraudulent, deceitful or misleading manner as determined by
Cingular in its sole discretion exercised in good faith;
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v)
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to Cingular or
its Affiliates or their respective employees; or,
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11
NON EXCLUSIVE AGREEMENT
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i)
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Reserved.
Cingular shall have the right to set off against any payment due
Agent by Cingular hereunder, or under any other Agreement between
Agent and Cingular or any Subsidiary of Cingular, for any amounts
owed to it by Agent, equipment purchased from Cingular, customer
account adjustments, amounts due for advertising, or amounts due
for failure to attend scheduled training, seminars, or workshops if
any. Not withstanding the forgoing, Cingular will not set off any
payment due Agent by Cingular with any amounts owed by Agent to
Cingular, unless Agent is past due in accordance with the terms for
such amounts owed, and Cingular will provide Agent 5 business days
notice in order that Agent may otherwise pay amounts owed and avoid
the set off.
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j)
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Should
Cingular, in its sole discretion, determine that Agent has inflated
or otherwise manipulated its count of Subscribers by falsifying
applications adding nonexistent Subscribers, adding Subscribers who
do not use minimal amounts of airtime, or by any other means or
methods, then Cingular shall, in addition to any other rights it
may have under this Agreement, have the right to immediately
terminate this Agreement and/or to collect from Agent, and Agent
agrees to pay to Cingular, all payments made to Agent by Cingular
for each such Subscriber and all amounts due for unpaid bills for
service for each such Subscriber. Agent agrees that Cingular may
deduct such amounts from compensation due Agent as a Charge Back.
Provided, however, Cingular shall not require Agent to repay any
compensation which was paid for such Subscriber after twelve (12)
months from such Subscriber’s Activation date.
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k)
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Exhibit C may
be revised as provided therein.
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9. Equipment
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a)
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Agent may
purchase Equipment from Cingular in accordance with the General
Purchase Agreement entered into by InPhonic, Inc.
(“PURCHASER”) and Cingular Wireless LLC
(“SELLER”) effective July 1, 2001. Agent may sell
Equipment to its customers at such prices as it determines in its
sole discretion. Agent understands that in order to purchase
Equipment from Cingular other than on a cash on delivery basis,
Agent may be required to sign security agreements, financing
statements and related documents.
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10. Use of Marks by Agent
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a)
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Periodically, Cingular will
publish a list of Marks that Agent is licensed to use under this
Agreement. The right granted hereunder shall be the non-exclusive
right of Agent to use the Marks solely in the Area. Such list will
also be supplemented with rules and procedures prescribed by
Cingular pertaining to the Marks. Agent agrees to comply with all
such rules and procedures prescribed by Cingular from time to time
during the term of this Agreement. Agent acknowledges that its
right to use the Marks is derived solely from this Agreement and is
limited to the identification of Agent as an agent of Cingular.
Agent recognizes the great value of the goodwill associated with
the Marks, and acknowledges that the Marks and all rights therein
and goodwill pertaining thereto, belong exclusively to Cingular,
and that the Marks also have a secondary meaning in the mind of the
public. Agent acknowledges and agrees that all usage of the Marks
by Agent and any goodwill established thereby shall inure to the
exclusive benefit of Cingular and
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12
NON EXCLUSIVE AGREEMENT
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its Affiliates
and that this Agreement does not confer any goodwill or other
interests in the Marks upon Agent. Any unauthorized use of the
Marks by Agent, or any use not in compliance herewith, shall
constitute an infringement of the rights of Cingular and its
Affiliates in and to the Marks and shall further constitute a
material breach of this Agreement.
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b)
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Agent shall use
the Marks with such words qualifying or identifying the agency
relationship of Cingular and Agent as Cingular from time to time
shall prescribe. Agent shall not use the Marks as part of any
corporate or trade name or with any prefix, suffix or other
modifying words, terms, designs or symbols, or in any modified
form, nor may Agent use the Marks in connection with the sale or
lease of any unauthorized product or service or in any other manner
not expressly authorized by this Agreement or separately in writing
by Cingular. If Agent uses Cingular’s Marks on any of
Agent’s stationery, other forms or business cards, Agent
agrees to display the Marks on such stationery, other forms, and
business cards used in its WCS business in the manner prescribed by
Cingular. Agent agrees to obtain such fictitious or assumed name
certificates or registrations as may be required by applicable law,
provided the fictitious or assumed name is approved in writing by
Cingular and Cingular is provided a copy of the certificate and/or
registration. If any fictitious or assumed name used by Agent
includes anything that identifies Cingular or its Marks, Cingular
may at any time require Agent to cease using such fictitious or
assumed name, and to cancel any corresponding certificate and/or
registration.
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c)
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If it becomes
advisable at any time in Cingular’s sole discretion for Agent
to modify or discontinue use of any Mark or substitute one or more
additional trade or service marks to identify its relationship with
Cingular or, if applicable, any Equipment, Agent agrees to comply
therewith within a reasonable time after written notice thereof by
Cingular and the sole obligation of Cingular in any such event
shall be to reimburse Agent for the out-of-pocket costs, if any, of
complying with this obligation. In addition, Agent shall replace
obsolete identification signs or identification material with new
signs or identification material should Agent adopt new Marks
replacing one or more Marks identified by Cingular in such list as
hereinbefore specified.
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d)
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Upon reasonable
notice from Cingular, Agent shall provide Cingular with samples of
all advertising and other literature, packages, labels, and
labeling prepared by Agent which use the Marks or the logos. When
using the Marks or the logos under this Agreement, Agent undertakes
to comply with all laws pertaining to trademarks or service marks
in force at any time in the Area.
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11. Cingular’s Title and Protection of
Cingular’s Rights
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a)
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Agent agrees
that it will not challenge the title or any rights of Cingular in
and to the Marks either dining the term of this Agreement or
thereafter.
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b)
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Agent agrees to assist Cingular,
and Cingular agrees to reimburse Agent for all associated
reasonable and necessary actual costs incurred by Agent in
connection therewith, to protect any of Cingular rights to the
Marks. Cingular, if it so desires, may commence or
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13
NON EXCLUSIVE AGREEMENT
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prosecute any
claims or suits in its own name or in the name of Agent or join
Agent as a party thereto for such purposes. When known, Agent shall
notify Cingular in writing of any infringements or imitations by
others of the Marks which are the same as or similar to those
covered by this Agreement. Cingular shall have the sole right to
determine whether any action shall be taken on account of any such
infringements or imitations. Agent shall not institute any suit or
take any action on account of any such infringements or imitations
without first obtaining the written consent of Cingular.
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12. Compliance With Laws And Good Business
Practices
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a)
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Agent shall
secure and maintain in force all licenses and permits required by
Agent and its employees in the enrollment of Subscribers and the
sale or lease of Equipment, installation and maintenance of
Equipment, including without limitation, all required FCC or other
permits and certifications, if required, and business and sales tax
licenses, and shall conduct its business in full compliance with
all state and federal laws, ordinances and regulations applicable
to Agent’s business. Agent shall sell Authorized Cingular
Services in accordance with applicable rules, regulations, statutes
and decisions governing such Services.
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b)
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Agent shall
promptly pay when due, all taxes and assessments against any real
or personal property used in connection with Agent’s
business, and all liens or encumbrances of every kind or character
created or placed upon or against any such property, and all
accounts and other indebtedness of every kind incurred by Agent in
the conduct of its business.
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c)
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Agent shall
comply, at its own expense, with the provisions of all applicable
municipal requirements and those state and federal laws and
executive orders applicable to Agent as an employer.
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d)
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Agent expressly
agrees not to discriminate against any Subscriber, employee or
applicant for service because of race, color, religion, age, sex,
national origin or physical handicap during the performance of this
Agreement and shall comply with the applicable provisions of
Exhibit F (Nondiscrimination Compliance Agreement) incorporated
herein and made a part of this Agreement. As used in Exhibit F,
“Contractor” shall refer to Agent. Agent agrees to
submit to Cingular, on Cingular request, a statement that it is in
compliance with this Section.
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13. Advertising and Business Practices of
Agent
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a)
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All advertising
and promotion by Agent shall (i) be completely factual, (ii)
conform to the highest standards of advertising and conform
completely with applicable laws. All advertising and marketing
materials which Agent desires to use in connection with the
Authorized Cingular Services must be submitted to Cingular for
written approval prior to their use, whether or not prepared or
previously approved by Cingular.
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b)
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Agent agrees
that it will not commence any advertising or promotion pursuant to
this Agreement without Cingular’s prior written
consent.
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14
NON EXCLUSIVE AGREEMENT
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c)
|
Agent shall
notify Cingular in writing within five (5) days of t
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