Current Report — Form 8-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 8-K Current Report 5 16K
5: EX-99..4 Notice of Pendency of Class and Deriv. Action 26 79K
2: EX-99.1 Order and Final Judgment 8 23K
3: EX-99.2 Stipulation of Settlement 34 85K
4: EX-99.3 Scheduling Order 6 19K
6: EX-99.5 Master Channel Agreement 23 76K
7: EX-99.6 Master Facilities Agreement 20 67K
EX-99.6 — Master Facilities Agreement
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Exhibit 99.6
Master Facilities Agreement
This Master Facilities Agreement ("Agreement") by and between MCI WorldCom
Network Services, Inc., a Georgia corporation with offices at 500 Clinton Center
Drive, Clinton, Mississippi ("WorldCom", which term includes WorldCom
affiliates), and Digex, Inc., a Delaware corporation, with offices at One Digex
Plaza, Beltsville, Maryland ("Digex", which term includes Digex affiliates), is
entered into as of January 1, 2001 ("Effective Date"). Each of WorldCom and
Digex are referred to as a "Party" and collectively as the "Parties".
WHEREAS, WorldCom owns or controls certain WorldCom data centers situated
in the locations set forth on Schedule 1 and in the future will make available
additional data centers (as defined below, each a "Facility", collectively, the
"Facilities") and desires to grant Digex a license to use space ("Space") and
related Ancillary Services (as defined on Schedule 1) in WorldCom's Facilities;
and
WHEREAS, Digex desires to purchase such a license on the terms and
conditions set forth herein.
NOW THEREFORE, in consideration of the foregoing premises and mutual
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties hereby
agree as follows:
1. Scope of this Agreement. Under this Agreement, WorldCom will sell and
Digex will purchase the right to use Space and connections from the
Space to a WorldCom Internet Protocol network hub ("Internet Transit
Bandwidth"), and related services in one or more WorldCom data centers
either set forth on Schedule 1 or as made available by WorldCom after
the Effective Date (as defined above, a "Facility", collectively, the
"Facilities") for the purpose of supporting customers purchasing
managed hosting services. The term Space shall include Rack Space,
Additional Space, Ancillary Services and Onsite Technical Support
Services as described in Schedule 1. This Agreement does not include
provision of Internet connections to Digex-owned or operated data
centers, which is provided under the terms of the UUdirect
Multi-Megabit Agreement executed on October 18, 2000, including any
amendments ("Bandwidth Agreement").
2. Facilities Covered. The initial Facilities in which Digex has agreed
to purchase Space and Internet Transit Bandwidth ("Current
Facilities"), and the pricing associated with each, are listed in
Schedule 1. Digex may obtain Space and Internet Transit Bandwidth in
the Current Facilities and other Facilities in accordance with the
terms and procedures outlined in this Agreement. Digex may use Space
to install, operate, maintain, and interconnect the Equipment for
itself and its managed
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hosting services customers. Digex shall not use Space to resell
colocation services on a standalone basis. Digex may, as a part of its
managed web hosting business, enter into channel agreements with
technology providers and other customers (that do not compete with
WorldCom) and use the Space for such providers and/or customers.
3. Minimum Specifications, Acceptance of Space, and Training.
3.1 WorldCom acknowledges and agrees that Digex has certain minimum
data center specifications that it requests its suppliers to meet
("Minimum Specifications") and agrees to use commercially
reasonable efforts to meet the Minimum Specifications in any
Facility in which Space is offered to Digex.. Digex's current
Minimum Specifications are set forth in Schedule 2. Digex
acknowledges that not every Facility meets or will meet all of
Digex's Minimum Specifications, and accepts that the pricing in
Schedule 1 reflects the current "as is" specification of each
Facility.
3.2 Digex shall have the right, upon reasonable advance notice, to
inspect a Facility to determine whether the Space meets its
Minimum Specifications. Alternatively, upon written request by
Digex with respect to a given Facility, WorldCom shall certify
with respect to which Minimum Specifications such Facility is in
compliance. After Space in a Facility has been made available to
Digex, Digex can periodically require that WorldCom review
whether that Facility continues to meet the specification for
that Facility most recently approved by Digex.
3.3 If further requested by Digex, where such request identifies the
specific Minimum Specifications with respect to which Digex
wishes to have a Facility not otherwise in compliance with
Digex's Minimum Specifications (as identified on Schedule 2)
brought into compliance, WorldCom will evaluate, in good faith,
the level of capital investment and the specific actions
necessary to bring such Facility into compliance with the Minimum
Specifications as requested by Digex. WorldCom will share the
results of such evaluation with Digex. The Parties will then
negotiate in good faith as to the course of action to be taken to
bring the Facility into compliance with the Minimum
Specifications. The mutually agreed upon results of any such
negotiation shall be reduced to writing, and shall specify, in
addition to the specific actions to be undertaken, the financial
responsibility of each Party for financing such actions. In no
event shall Digex have any obligation to invest capital or make
any improvements in any Facilities. In no event shall WorldCom
have any obligation to invest capital or make any improvements to
a Facility under this Section 3.3 where such investment exceeds
any additional revenue commitment Digex is willing to make to
WorldCom with respect to Digex's use of such Facility, taking
into account both Digex direct sales and Digex sales through the
World-
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Com channel. Notwithstanding the foregoing, the parties shall
cooperate with each other in WorldCom's efforts to build any new
Facilities intended to serve as fully functioning Internet data
centers in conformity with the Minimum Specifications and/or in a
manner that meets the needs of customers served by each of
WorldCom and Digex, including, but not limited to, any WorldCom
channel customers.
3.4 WorldCom will notify Digex at least sixty (60) days in advance of
Space in any Facility being made available to Digex
("Availability Date"). Digex may reject Space on the basis that
the Space does not meet the Minimum Requirement by notifying
WorldCom in writing of its decision at least thirty (30) days
prior to the Availability Date. Any such notice rejecting the
Space shall state with specificity the Minimum Specifications
that have not been met for that Space. If no written notice of
rejection is received by the thirty (30th) day prior to the
Availability Date the Space shall be deemed accepted.
3.5 The Parties shall undertake mutual reasonable best efforts to
reduce to the point of elimination the need for Digex personnel
on-site within a Facility. Digex may temporarily assign a
technical support team (the "Digex Site Start-Up Team") to
install, deploy, operate and maintain the equipment, systems, and
procedures necessary for the provision of Digex managed hosting
services in that Facility. The applicable Digex Site Start-Up
Team shall (a) train the individuals responsible for WorldCom
On-Site Technical Support in the given Facility on all
foreseeable technical support that may be required within the
Facility after departure of the Digex Site Start-Up Team, (b)
develop procedures for the effective performance of this
technical support, and (c) perform such technical support on an
interim basis to the extent it cannot be performed by WorldCom
On-Site Technical Support.
4. Forecasts. Digex shall submit written forecasts to WorldCom's
designated point of contact every month listing the amount of Rack
Space and Internet Transit Bandwidth that Digex anticipates requiring
in each Facility during the subsequent twelve (12)-month period. These
forecasts are non-binding, and shall not obligate Digex to purchase
the forecasted Space from WorldCom nor WorldCom to provide the
forecasted required Space but are meant to (a) facilitate
communications between the Parties; (b) identify potential Space
constraints, and (c) allow the Parties to prepare additional Space in
advance of Digex's need for such Space to serve customers. The first
such forecast is due within five (5) days from the Effective Date. If
Digex does not provide a forecast with respect to a Facility, Digex's
forecast for such Facility shall be assumed to be no less than the
Space requirements set forth in Digex's last forecast. In any event,
WorldCom agrees to provide Digex with adequate and sufficient Space to
permit Digex to provide services to WorldCom's channel customers.
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5. Minimum Revenue Commitment: Provisions relating to the Minimum Revenue
Commitment owed by Digex to WorldCom shall be set forth in Schedule 1,
Section 3.
6. Term and Termination.
6.1 This Agreement will continue until December 31, 2003 ("Initial
Term"). Either Party shall have the option to request twelve (12)
month extensions of the Term ("Extended Term") that may be
accepted or rejected by the other Party, subject to the
following:
6.1.1 Each request for an extension of the term must be in
writing and shall request an additional extension period of
twelve (12) months beginning on January 1. All requests for
an extension must be delivered by the requesting Party to
the other Party no less than twelve (12) months prior to the
expiration of the Initial Term, or subsequent Extended Term.
The request shall be granted and the Agreement deemed
extended for an additional twelve (12) months unless the
other Party delivers to the requesting Party a written
rejection of the extension request within 30 days of
receiving the notice of request for an extension.
6.1.2 In the event neither Party requests an extension, or in the
event that one Party rejects the proposed extension, the
Agreement shall terminate at the end of the Initial Term or
any Extended Term;
6.2 Either Party may immediately terminate this Agreement for Cause.
"Cause" will mean the failure of the other Party to cure a breach
of a material obligation that is capable of being cured within
thirty (30) days under this Agreement within thirty (30) days
after receipt of notice from the terminating Party or a
commercially reasonable amount of time for any breach that cannot
be cured within a thirty (30) day cure period. Such notice will
identify the material obligation under this Agreement at issue
and the basis for the terminating Party's belief that the
non-terminating Party is in breach and will state that, if the
non-terminating Party does not cure the breach within the
relevant period, the terminating Party will immediately terminate
the Agreement for Cause.
6.3 WorldCom shall have the right to terminate this Agreement upon
thirty (30) days written notice in the event of the following:
6.3.1 The proposed merger between WorldCom and Intermedia is not
fully approved and completed on or before December 31, 2001;
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6.3.2 The transfer of a majority ownership or voting interest in
Digex to an entity that WorldCom considers a competitor of
WorldCom in any respect;
6.3.3 The Parties are unable to reach final agreement on the
proposed Digex/WorldCom Funding Agreement on or before the
later of 30 days after the date on which WorldCom provides
to Digex a complete draft of the proposed Funding Agreement
or March 31, 2001;
6.3.4 The proposed settlement envisioned by the Memorandum of
Understanding dated February 15, 2001 regarding the In re:
Digex, Inc. Shareholder Litigation, Consolidated Civil
Action No. 18336 NC, pending in the Court of Chancery in the
State of Delaware, does not become final and non-appealable
on or before December 31, 2001;
6.3.5 Digex's insolvency, apparent inability to pay debts as they
become due, filing of bankruptcy or general assignment for
the benefit of creditors;
6.4 Digex shall have the right to terminate this Agreement upon
thirty (30) days written notice in the event of the following:
6.4.1 The proposed merger between WorldCom and Intermedia is not
fully approved and completed on or before December 31, 2001;
6.4.2 The Parties are unable to reach final agreement on the
proposed Digex/WorldCom Funding Agreement on or before the
later of 30 days after the date on which WorldCom provides
to Digex a complete draft of the proposed Funding Agreement
or March 31, 2001;
6.4.3 The proposed settlement envisioned by the Memorandum of
Understanding dated February 15, 2001 regarding the In re:
Digex, Inc. Shareholder Litigation, Consolidated Civil
Action No. 18336 NC, pending in the Court of Chancery in the
State of Delaware, does not become final and non-appealable
on or before December 31, 2001
6.4.3 WorldCom's insolvency, apparent inability to pay debts as
they become due, filing of bankruptcy or general assignment
for the benefit of creditors;
7. Term for Space. Space in a given Facility shall be subject to an
initial minimum term of six months from the date such space is made
available to Digex. Thereafter, use of such Space may be terminated by
Digex upon 60 days' advance written notice. In the event Digex
terminates its use of Space during the initial six-
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month term for reasons other than WorldCom breach, Digex shall pay
WorldCom an amount equal to the total fees due for such Space for the
balance of such initial term. In the event that the initial term for
any Space extends beyond the termination or expiration of this
Agreement, the terms and conditions of this Agreement shall continue
to apply to the use of such space by Digex for the balance of the term
of the space.
8. Transition Obligations.
8.1 In the event of the expiration of this Agreement, or its
termination for Cause by Digex in accordance with Section 6.2
then (a) the Parties shall continue to perform their respective
obligations hereunder subject to the terms of this Agreement for
a transition period not to exceed twelve (12) months from the
date of expiration or termination of the Agreement; and (b) for
twelve (12) months from the date of expiration or termination of
this Agreement the Monthly Fees shall remain the same as on the
Agreement's expiration or termination date, and thereafter shall
be adjusted to commercial rates.
8.2 In the event this Agreement is terminated for Cause by WorldCom
in accordance with Section 6.2, and such Cause includes
non-payment of undisputed items (or any non-payment not occurring
as the result of a good faith dispute), (a) the Parties shall
continue to perform their respective obligations hereunder
subject to the terms of this Agreement for a transition period
not to exceed one month from the termination date of the
Agreement; and (b) the Monthly Fees in effect on the date of the
Agreement's termination shall remain in effect during such
transition period;
8.3 In the event this Agreement is terminated by WorldCom for a Cause
unrelated to non-payment, (a) the Parties shall continue to
perform their respective obligations hereunder subject to the
terms of this Agreement for a transition period not to exceed
twelve (12) months from the termination date of the Agreement;
and (b) effective on the termination date of this Agreement the
Monthly Fees shall be adjusted to commercial rates.
8.4 Subject to the terms and conditions set forth in Sections 8.1,
8.2, and 8.3 above, Digex shall have the option to use, but is
under no obligation to continue to use, the Space in any Facility
for Digex's Customer Equipment that is dedicated to Digex's
direct customers or for any WorldCom channel customer that Digex
is obligated to continue to provide service during any applicable
transition period.
9. Fees. Digex shall pay monthly fees for Rack Space, Additional Space
(if applicable), Internet Transit Bandwidth, and any one-time fees for
Cross-Connect Services (collectively the "Monthly Fees"). Monthly Fees
for Space and Internet Tran-
108
sit Bandwidth in Current Facilities are set forth in Schedule 1.
Monthly Fees are specified in US$. Monthly Fees for Space and Internet
Transit Bandwidth in other Facilities shall be as mutually agreed-upon
by the Parties, with the price for Rack Space based upon the cost
methodology in Schedule 1, Section 2.. The Parties agree that the
Monthly Fees shall be based on WorldCom's cost for such Space as
described in Schedule 1, Section 2 ("Components of WorldCom Costs").
Monthly fees for space are inclusive of real estate taxes assessed
upon the facility in which the Space is located. Digex's obligation to
pay for Space in a Facility shall begin on the date any Customer
Equipment or Infrastructure Equipment is initially installed in the
Rack Space. Digex's obligation to pay for Internet Transit Bandwidth
in a Facility shall begin on the date of first use of such Internet
Transit Bandwidth.
10. Business Review of Monthly Fees.
10.1 The Monthly Fees specified in Schedule 1 shall not be changed
during the first six months of the Agreement. During each
December that this Agreement remains in force, WorldCom will
perform a review of the Monthly Fees applicable in a given
Facility to determine whether material changes to the Components
of WorldCom's Costs (as described in Schedule 1, Section 2)
necessitate an adjustment to the Monthly Fee for Space in that
Facility, including but not limited to a reduction in the Monthly
Fee for Space in a given Facility resulting from WorldCom
efficiencies that had the effect of reducing the relevant
Components of WorldCom Costs for that Facility.
10.2 WorldCom will complete the cost review required pursuant to
Section 10.1 in December based upon cost data from that calendar
year, and the Program Executive of WorldCom (as defined in the
Master Channel Agreement) will inform Digex in writing of any
adjustments to the Monthly Fee for Space in a given Facility. Any
such adjustment shall be effective in January, the calendar month
following the month in which WorldCom began its review.
10.3 In the event Digex disputes any adjustment to the Monthly Fee
made by WorldCom, at the written request of Digex made within
thirty days of its receipt of WorldCom's notice of the adjustment
Digex disputes, WorldCom will, within sixty (60) days from Digex
written notice, conduct an analysis of the pricing at which
similar services (including space and bandwidth) at the same
Facility have been sold to other WorldCom customers that are not
WorldCom affiliates, and effective the calendar month of the
Digex request, the Monthly Fee for Space in that Facility shall
be adjusted to the most favorable pricing obtained by any another
WorldCom customer purchasing similar quantities of similar
services in that Facility.
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11. WorldCom Obligations.
11.1 WorldCom shall provide the Space, Infrastructure Equipment,
Onsite Technical Support Services, Ancillary Services, and
Internet Transit Bandwidth as specified in Schedule 1 in
accordance with the terms and conditions of this Agreement and
shall comply with the generally accepted standards and practices
of the managed web hosting (if available) or the
telecommunications industry (whichever is higher) of the locality
in which the applicable Facility is located that are not
inconsistent with the terms and conditions hereof.
11.2 WorldCom shall perform its obligations hereunder in compliance
with all governing rules, regulations, orders or laws, and shall
maintain in full force and effect all required licenses,
consents, certificates, permissions or authorizations necessary
for the performance of its obligations hereunder.
11.3 WorldCom shall not cause any liens of other encumbrances to be
placed on any Customer Equipment or Digex Equipment, and, in the
event any liens placed on such Equipment are attributable to
WorldCom, then WorldCom shall discharge such liens expeditiously.
If any such liens are not discharged within ten (10) days from
the date of Digex's notice to remove any such lien, Digex, may,
at its option, discharge said lien and shall receive a credit or
otherwise off-set any costs or expenses incurred by Digex
associated with such liens (including without limitation, any
reasonable attorneys' fees and/or allocable costs of in-house
counsel) against any amount due WorldCom hereunder.
11.4 WorldCom shall not, by reason of this Agreement, obtain any
right, title, or interest in any Customer Equipment or Digex
Equipment.WorldCom agrees that no individual it authorizes to
enter the Facility will have been convicted of a felony.
WorldCom's employees and agents are prohibited from bringing any
of the following materials into a Facility: wet cell batteries,
explosives, flammable liquids or gases, alcohol, controlled
substances, weapons, cameras, audio or video recording devices,
and similar equipment and materials.
11.5 WorldCom agrees to maintain the Space in an orderly manner and
shall be responsible for the prompt removal from the Facility of
all trash, packing material, cartons, etc. that WorldCom's
employees, customers or agents brought to or had delivered to the
Facility.
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11.6 WorldCom agrees to maintain and operate its Equipment in a safe
manner, and keep the Space and any portion of the Facility it
accesses in good order and condition. WorldCom will take all
commercially reasonable efforts to ensure that no employees,
customers, agents of WorldCom will harm or allow any attempt to
breach the security of the Facility, the Space, or any third
party system, network, or property at the Facility or accessed by
means of the Space.
11.7 WorldCom agrees not to alter, tamper with, adjust, or repair any
equipment or property not belonging to WorldCom. (except for any
Infrastructure Equipment), and agrees not to erect signs or
devices on the exterior of the storage cabinet or to make any
construction changes or material alterations to any Space
provided to Digex or the interior or external portions of the
Facility without Digex's prior written consent, which shall not
be unreasonably withheld.
12. Digex Obligations.
12.1 Digex shall perform its obligations hereunder in accordance with
the terms and conditions of this Agreement and shall comply with
the generally accepted standards and practices of the
telecommunications industry of the locality in which the
applicable Facility is located that are not inconsistent with the
terms and conditions hereof. Digex may use the Space only for the
purposes of installing, maintaining, and operating the Equipment.
Subject to the terms of this Agreement, WorldCom shall permit
Digex to have means of access to the Space and Facilities (both
physical and remote) at all times 24x7. Access to the Facility is
restricted to Digex's authorized employees and agents and access
by customers will only be with WorldCom prior approval. Digex
will furnish to WorldCom, and keep current, a written list for
each Facility identifying a maximum of nine (9) individuals
authorized to obtain entry to that Facility and access the Space;
provided, however, Digex will have the right to request that
other employees, agents and/or customer representative be granted
temporary accessto a Facility (or the Space) by providing
WorldCom with advance notice of the names of those persons and
the dates of the requested access, provided that such request may
not be unreasonably denied by WorldCom. Digex agrees that no
employee or subcontractor it authorizes to enter the Facility
will have been convicted of a felony. Digex assumes
responsibility for all acts or omissions of the individuals
included on this list or authorized by Digex to enter the
Facility. Digex's employees, customers, and agents will comply
with all applicable laws and ordinances; with the generally
accepted standards and practices of the telecommunications
industry in that locality; and with all WorldCom or Facility
security procedures, Facility rules, requirements, and safety
practices. WorldCom may revoke the entry privileges of any person
who fails to comply with this
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Agreement, who is disorderly or who continues to be disorderly
following notification thereof and a reasonable opportunity to
cure.
12.2 Subject to and in accordance with generally accepted managed web
hosting industry standards in that locality, Digex's employees,
customers, and agents shall not use any products, tools,
materials, or methods that, in WorldCom's reasonable judgment,
may harm, endanger, or interfere with the Facility, or the
personnel or property of WorldCom, its vendors or its other
customers. WorldCom reserves the right to take any reasonable
action to prevent such potential harm.
12.3 Digex shall be required to maintain the Space in an orderly
manner and shall be responsible for the prompt removal from the
Facility of all trash, packing material, cartons, etc. that
Digex's employees, customers or agents brought to or had
delivered to the Facility.
12.4 Upon termination of this Agreement or the release of all Space
within a given Facility, Digex is responsible for arranging
prompt removal of its Equipment from the Facility at Digex's sole
risk and expense.
12.5 Digex will maintain and operate the Equipment in a safe manner,
and keep the Space and any portion of the Facility it accesses in
good order and condition. Digex will take all commercially
reasonable efforts to ensure that no employees, customers, agents
of Digex will harm or allow any attempt to breach the security of
the Facility, the Space, or any third party system, network, or
property at the Facility or accessed by means of the Space.
12.6 Digex agrees to use the common areas of the Facility for the
purposes for which they are intended and abide by any rules
governing such common areas. Such rules include, but are not
limited to, a prohibition against smoking in the Facility.
12.7 Digex's employees and agents are prohibited from bringing any of
the following materials into the Facility: wet cell batteries,
explosives, flammable liquids or gases, alcohol, controlled
substances, weapons, cameras, audio or video recording devices,
and similar equipment and materials.
12.8 Digex agrees not to alter, tamper with, adjust, or repair any
equipment or property not belonging to Digex (except for any
Infrastructure Equipment), and agrees not to erect signs or
devices on the exterior of the storage cabinet or to make any
construction changes or material alterations to the Space or the
interior or external portions of the Facility without WorldCom's
prior written consent.
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13. Lease Obligations. For Facilities leased by WorldCom or any of its
affiliates, WorldCom shall provide written notice immediately upon any
termination or expiration of a lease that would necessitate relocation
of the Space and Equipment, provided that in the event of any
termination or expiration of a lease, WorldCom may cease providing
Space in a given Facility and instead provide Digex comparable Space
in another Facility. In such event, the Parties shall in good faith
develop a migration plan to move Equipment to the new Space such that
disruption of Digex's services to its customers is minimized. WorldCom
shall reimburse Digex for any reasonable costs incurred by Digex
directly in connection with any such migration plan. Notwithstanding
the foregoing, WorldCom shall (a) not unreasonably or arbitrarily
require Digex to relocate any Equipment and in the event of any such
relocation the Space shall to the fullest extent possible meet or
exceed the most recent mutually agreed upon specification for the
Facility; and (b) at all times provide Digex with Space that affords
Digex comparable environmental conditions for the Equipment and
comparable accessibility to the Equipment.
14. Damage to Space or Facilities.
14.1 If Space or a Facility is damaged or destroyed, WorldCom shall
give prompt notice to Digex of such damage, and in emergency
situations, may temporarily relocate Equipment. If the damage or
destruction renders the Space or Facility wholly unsuitable for
Digex's use hereunder, then either Party may elect within ten
(10) days after such damage, to terminate this Agreement with
respect to the Space or Facility, and if either Party shall so
elect, by giving the other written notice of termination, both
Parties shall stand released of and from further liability under
the terms hereof with respect thereto.
14.2 If the Space or Facility suffers only minor damage and is not be
rendered wholly unsuitable for Digex's use, or is damaged and the
option to terminate is not exercised by either Party, WorldCom
shall, at its sole cost and expense, repair the particular Space
or Facility to substantially the same condition it was in prior
to the damage, completing the same without delay, time being of
the essence. In the event that WorldCom shall fail to complete
the repair within a reasonable time period or relocate the
Equipment in the same manner provided in Section 13 for
termination of a lease, Digex shall have the option to terminate
this Agreement with respect to the affected Space
14.3 In all cases where Space or Facilities are damaged or destroyed,
Digex shall be entitled to an equitable abatement of the Monthly
Fees for such Space or Facility, depending upon the unsuitability
of the Space or Facility for Digex's permitted use, until such
Space or Facility is fully repaired and restored and the
Equipment installed therein. In all cases where Space or
Facilities are damaged or destroyed, WorldCom shall (i) not
unreasonably
113
or arbitrarily require Digex to relocate any Equipment; and (ii)
at all times provide Digex with Space that affords Digex
comparable environmental conditions for the Equipment and
comparable accessibility to the Equipment.
15. Service Level Requirements. The basic Service Level Agreement ("SLA")
applicable to the Space in any U.S. Facility provided under this
Agreement is set forth in Schedule 3. The Parties contemplate that by
March 15, 2001 they will have adopted additional SLAs for U.S.
Facilities including, but not limited to, the following topics:
Response Time Guarantees and Installation Guarantees. For Facilities
outside the U.S., Facility-specific SLAs covering the same topics as
the U.S. SLA shall be mutually agreed upon by the Parties, reduced in
writing, and attached to this Agreement. The SLA sets forth Digex's
sole remedies for any claim relating to the availability or use of the
Space, including any failure to meet any guarantee set forth in the
SLA. All SLA calculations and determinations will be based on WorldCom
and Digex records and data that are maintained in the regular course
of business. In the event of a difference between Digex and WorldCom
records on a particular measured issue, the WorldCom records shall
prevail, unless such records and data are demonstrated to be in error]
Notwithstanding anything to the contrary, the maximum amount of credit
in any calendar month under the SLA shall not exceed the Monthly Fee
which, absent the credit, would have been charged for the affected
Space in the applicable Facility that month.
16. Responsibility for Digex Customer Content. Digex and its customers,
and not WorldCom, have sole and exclusive control over the software
applications and content residing on Equipment in the Space provided
to Digex ("Digex Customer Content"). WorldCom acknowledges and agrees
that this Digex Customer Content may include certain Digex proprietary
software used in the provision of managed hosting services and that
such software may constitute Digex Confidential Information governed
by the terms of Schedule 4, Section 7 ("Confidentiality"). Digex
acknowledges and WorldCom agrees that in the performance of its
obligations hereunder WorldCom is not providing, either directly or
indirectly, and will not seek access to the Digex Customer Content
that would allow WorldCom to exercise any ownership of or control over
the Digex Customer Content. Digex shall promptly and thoroughly
respond to any notices, complaints, or demands forwarded to Digex by
WorldCom, including, but not limited to notices that the Digex
Customer Content violates the Digital Millennium Copyright Act (the
"DMCA") or any other law, regulation, or private right.
17. No Estate Or Property Interest. Digex acknowledges that it has been
granted only a license to occupy certain designated portions of the
Facilities and that it has not been granted any real property
interests in the Space or any Facility. Payments by Digex under this
Agreement do not create or vest in Digex (or in any other person) any
leasehold estate, easement, ownership interest, or other property
right or
114
interest of any nature in any part of the Facility. The Parties intend
that Equipment, whether or not physically affixed to the Facility,
shall not be construed to be fixtures.
18. Additional Terms and Conditions. Addition terms and conditions that
apply under this Agreement are set forth in Schedule 4.
19. Integration/No Oral Modification Clause. This Agreement, including all
Schedules hereto, sets forth the entire agreement between WorldCom and
Digex with respect to the subject matter herein and supersedes all
previous and contemporaneous written and oral representations,
understandings or agreements related to the subject matter herein.
This Agreement may not be modified except in a writing signed by
authorized representatives of both Parties.
AGREED AND ACCEPTED FOR AND ON BEHALF OF DIGEX
-----------------------------------------
Signature
-----------------------------------------
Name
-----------------------------------------
Title
-----------------------------------------
Date
AGREED AND ACCEPTED FOR AND ON BEHALF OF WORLDCOM
-----------------------------------------
Signature
-----------------------------------------
Name
-----------------------------------------
Title
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Date
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Schedule 4
General Terms and Conditions
20. Contractors. WorldCom affiliates or subcontractors may perform some or all
of WorldCom's duties and/or obligations under the Agreement, though this
shall not relieve WorldCom of its performance obligations. At Digex's
request WorldCom will identify the specific functions then-performed by
subcontractors in a given Facility.
21. Indemnification. WorldCom and Digex agree to defend, indemnify and hold
each other harmless from and against any third party claims, suits, damages
and expenses asserted against or incurred by one Party arising out of
bodily injury, death, or damage to real or tangible personal property
caused by the negligent act or omission of the other Party.
22. CONSEQUENTIAL DAMAGE WAIVER AND LIMITATION OF LIABILITY.
3.1 Neither Party nor any of its Affiliates will be liable to the other
Party for indirect, consequential, special or punitive damages,
including without limitation lost business, profits or goodwill,
awarded under any theory of liability, including without limitation
breach of contract, tort or statute and arising from or related to
this Agreement; provided however, that until such time as the WorldCom
and Intermedia merger is fully completed, the foregoing limitation
shall not apply with respect to claims by one party that the other
party has engaged in intentional misappropriation of the other party's
Intellectual Property, or has intentionally breached the
Confidentiality Provisions of Section 7 of this Schedule.
3.1 Digex's sole remedies for WorldCom's violation of any agreed upon SLAs
shall be set forth in those SLAs.
3.2 The total liability of WorldCom and its affiliates for any single
claim or cause of action arising from a single Facility (including but
not limited to breach of contract, statutory, negligence, and other
torts) will be limited to the lesser of: (a) direct damages proved by
Digex in connection with the claims; or (b) the total amount of
Monthly Fees paid to WorldCom by Digex for the entire Rack Space and
Internet Transit Bandwidth in the Facility in the three (3) calendar
months preceding the date the claim or cause of action arose.
3.3 The total aggregate liability of WorldCom and its affiliates for all
claims or causes of action arising out of or relating to this
Agreement shall not exceed
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the lesser of (a) $10,000,000.00 or (b) the direct damages proved by
Digex in connection with the claims.
3.4 The total liability of Digex and its affiliates for any single claim
or cause of action arising from a single Facility (including but not
limited to breach of contract, statutory, negligence, and other torts)
will be limited to the lesser of: (a) direct damages proved by
WorldCom in connection with the claims; or (b) the total amount of
Monthly Fees paid to WorldCom by Digex claim for the entire Rack Space
and Internet Transit Bandwidth in the Facility in the three (3)
calendar months preceding the date of the in which the claim or cause
of action arose.
3.5 The total aggregate liability of Digex and its affiliates for all
claims or causes of action arising out of or relating to this
Agreement shall not exceed the lesser of (a) $10,000,000.00 or (b) the
direct damages proven by WorldCom in connection with the claims.
3.6 Notwithstanding the foregoing, Digex's payment obligations hereunder
shall not be subject to the limitations of liability under Section 3.5
and 3.6. Notwithstanding any other provision in this Agreement to the
contrary, the liability of the Parties and their affiliates will not
be limited for or by (a) bodily injury or death caused by such Party's
or its affiliates' negligence or willful misconduct; (b) loss or
damage to real or tangible personal property caused by such Party's or
its affiliates negligence or willful misconduct; (c) such Party's of
its affiliates' indemnity obligations under Section 2 of this
Schedule.
4 NO WARRANTY. Except as set forth in any applicable SLAs, WorldCom expressly
disclaims any and all other warranties, written or oral, statutory or
contractual, express or implied, including without limitation, the warranty
of merchantability, infringement, completeness, quality or fitness for a
particular purpose or use relating to subject matter of this Agreement.
5 Force Majeure. Other than as expressly set forth in this Agreement, neither
Party shall be liable under this Agreement for delays, failures to perform,
damages, losses or destruction, or malfunction of any equipment, or any
consequence thereof, caused by, or due to any cause beyond its reasonable
control, including, but not limited to, fire, earthquake, flood, water, the
elements, acts of God, third party labor disputes, utility curtailments,
cable cuts, failure caused by telecommunications or other Internet
provider(s), power failures, explosions, civil disturbances, vandalism,
governmental ac-
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tions, shortages of equipment or supplies, or any other force or occurrence
beyond its reasonable control.
6 Notice. Each notice required or permitted under this Agreement shall be
given in writing. Such notice shall be personally delivered; sent by first
class mail, postage prepaid and marked for delivery by certified or
registered mail, return receipt requested; sent by nationally recognized
overnight courier; or sent by facsimile; in each case, addressed to the
Parties listed below at their respective places of business, or at such
other addresses of which notice has been given to the addressing Party:
If to WorldCom: WorldCom
Three Ravinia Drive
Atlanta, Georgia 30346
Attn: Vice President - E-Business Development
w/ copy to: WorldCom
1133 19th Street. NW
Washington, DC 20036
Attn: Vice President- Business Transactions
Law and Public Policy
If to Digex: Digex
6900 Muirkirk Meadows Drive
Beltsville, Maryland 20705
Attn: Senior Vice President - Business Operations
w/ copy to: Digex
6900 Muirkirk Meadows Drive
Beltsville, Maryland 20705
Attn: General Counsel
Such notice shall be deemed delivered upon personal delivery; five days
after deposit in the U.S. mail, one day after deposit with a nationally
recognized overnight courier, and upon actual confirmation of receipt of a
facsimile.
7 Confidentiality. Each Party shall protect as confidential, and shall not
disclose to any third party, any and all Confidential Information received
from the disclosing Party, or such Party's customers, or otherwise
discovered by the receiving Party during the term of this Agreement.
Confidential Information shall include, but not be limited to, the pricing
and terms of this Agreement, and all information relating to the disclosing
Party's or such Party's customers' technology, research, development,
business affairs, and marketing or sales plans (collectively the
"Confidential Information"). The Parties agree that a Party's Intellectual
Property (as defined in the Master Channel Agreement) shall be deemed to be
that Party's Confidential Information. The Parties shall use
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Confidential Information only for the purposes set forth in this Agreement.
The foregoing restrictions on use and disclosure of Confidential
Information do not apply to information that: (i) is in the possession of
the receiving Party at the time of its disclosure and is not otherwise
subject to obligations of confidentiality; (ii) is, or becomes publicly
known, through no wrongful act or omission of the receiving Party; (iii) is
received without restriction from a third party free to disclose it without
obligation to the disclosing Party; (iv) is developed independently by the
receiving Party without reference to the Confidential Information, or (v)
is required to be disclosed by law, regulation, or court or governmental
order. Each Party acknowledges that breach of this provision by it would
result in irreparable harm to the other Party, for which money damages
would be an insufficient remedy, and therefore that the other Party shall
be entitled to seek injunctive relief to enforce the provisions of this
Section 7.
8 Payment. No later than the tenth (10th) day of each calendar month,
WorldCom will provide Digex with a detailed monthly billing file in a
mutually agreed upon format for Digex payment purposes. WorldCom will send
Digex a single, consolidated, monthly invoice for all billing under the
Agreement, with all charges invoiced in U.S. Dollars. Digex will pay all
undisputed charges contained in the WorldCom invoice within thirty (30)
days after receipt of invoice ("Due Date"). Digex may withhold payment of
charges disputed in good faith, provided that Digex documents the reasons
for the dispute, and provided that the Parties utilize commercially
reasonable efforts to resolve the dispute according to the escalation
procedures set forth in Section 9 of this Schedule. In the event that Digex
withholds payment due to an invoice dispute with its customer, Digex will
only withhold from WorldCom amounts that are no greater than those
reasonably related to WorldCom's alleged non-performance. Digex shall
provide written notice of any dispute within 30 days of the Due Date. In
the event Digex does not provide notice of dispute within this period, the
invoice will be deemed correct. Any invoice not properly disputed pursuant
to the provisions of this Section that remains unpaid after the Due Date
will bear late payment fees at the lower of one and one-half percent
(1-1/2%) per month or the highest rate legally permissible, until paid.
9 Dispute Resolution. In the event of a dispute under this Agreement, the
Parties agree to first escalate resolution of that dispute within their
respective organizations in a good faith attempt to resolve the matter. The
Parties will use commercially reasonable efforts to resolve any disputes
without resort to litigation, and agree to pursue the following dispute
resolution process to resolve any and all forms of disputes:
9.1 All disputes will be identified in writing and sent to the appropriate
executive and legal contacts set forth in the notice provisions.
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9.2 If the dispute is not resolved within ten (10) days after receipt, the
dispute will be escalated to the VP level.
9.3 If the dispute is not resolved within ten (10) days after secondary
escalation, the dispute will be escalated to the Presidential level.
9.4 If the dispute not resolved within ten (10) days after Presidential
escalation, the dispute shall be submitted for binding arbitration
pursuant to the commercial rules and procedures of the American
Arbitration Association for resolution.
9.5 Parties can extend dispute resolution periods by written agreement.
9.6 In the event that this Agreement requires the Parties to reach a
mutual agreement before undertaking any performance of any obligations
under this Agreement and the Parties are unable to agree, it will be
treated as a dispute subject to this Section 9.
10 Data Protection. By entering into this Agreement, Digex acknowledges that
information regarding Digex, its employees, customers, or any user of the
Space or Internet Transit Bandwidth provided to or otherwise obtained by
WorldCom in connection with this Agreement ("Data") may be processed by:
(i) WorldCom, WorldCom affiliates, and WorldCom agents both within and
outside Europe and outside the country(ies) where Data are obtained in
connection with processing Digex's order, and the delivery, installation,
support, and maintenance of the services; and (ii) WorldCom and WorldCom
affiliates to incorporate Data into global database(s) of all WorldCom and
WorldCom affiliate customer information, accessible from any part of the
world via web technology (or such other appropriate technology) to assist
WorldCom and WorldCom affiliates in providing better or complementary or
ancillary products and services to their customers. From and after the
Effective Date, Digex agrees to obtain informed and express consent to the
processing of Data as set forth herein from its employees, customers, and
any users of the Space.
11 Intellectual Property.
11.1 Digex shall have no ownership interest in any WorldCom Intellectual
Property (as defined in the Master Channel Agreement) obtained by
Digex in connection with its performance of this Agreement. As between
the Parties, WorldCom shall own all such Intellectual Property and any
Intellectual Property obtained by Digex for the purpose of performance
of Digex's obligations under this Agreement can solely be used for the
express purposes set forth herein.
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11.2 WorldCom shall have no ownership interest in any Digex Intellectual
Property (as defined in the Master Channel Agreement) obtained by
WorldCom in connection with its performance of this Agreement. As
between the Parties, Digex shall own all such Intellectual Property
and any Intellectual Property obtained by WorldCom for the purpose of
performance of WorldCom's obligations under this Agreement can solely
be used for the express purposes set forth herein.
11.3 Neither Party shall, and shall not permit others to, modify or
decompile any Intellectual Property of the other Party, make
derivative works thereof, or transfer, assign or sublicense any such
Intellectual Property to any third party, except to the extent of the
express purposes set forth herein. On or following any termination or
expiration of this Agreement (and following any transition period),
each Party shall immediately cease all use of the other Party's
Intellectual Property and shall not retain any copies thereof (in any
media or format).
12 Choice of Law; No Waiver. This Agreement will be subject to and governed by
the substantive laws of the State of New York, without regard to that
state's conflicts of law principles. The venue for resolution of any
dispute that is not resolved by the parties in accordance with this
Agreement will be the state or federal court sitting in New York, New York.
No failure on the part of either Party to exercise, and no delay in
exercising, any right or remedy hereunder shall operate as a waiver thereof
nor shall any single or partial exercise of any right or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other
right or remedy granted hereby or by law.
13 Assignment. This Agreement, or any interest herein, will not be assigned,
in whole or in part, by either Party without the prior written consent of
the other Party, which will not be unreasonably withheld. Notwithstanding
the forgoing, WorldCom may assign this Agreement to an affiliate.
14 Successors. This Agreement shall inure to the benefit of and be binding on
the Parties and their respective heirs, executors, administrators, legal
representatives, successors, and permitted assigns.
15 Bandwidth. The following provisions of the Bandwidth Agreement shall apply
to the Internet Transit Bandwidth provided hereunder: Section 1.C ("Network
Applications Fees"), Section 9, Section 11, and Section 12. For purposes of
this Section any reference to "UUNET" in the Bandwidth Agreement shall be
deemed a reference to WorldCom.
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16 No Oral Modification. Nothing in this Agreement, or in the course of
dealing between the Parties pursuant to this Agreement, shall be deemed to
create between the Parties (including their respective directors, officers,
employees and agents) a partnership, joint venture, association, employment
relationship or any other relationship, other than that of independent
contractors with respect to each other. Neither Party shall have the
authority to commit or legally bind the other Party in any manner
whatsoever, including but not limited to, the acceptance or making of any
agreement, representation or warranty. 17 No Third Party Beneficiaries.
This Agreement inures to the benefit of WorldCom and Digex only and no
third party shall have any rights hereunder.
18 Severability. If any provision of this Agreement is held invalid or
unenforceable, such provision shall be deemed deleted from this Agreement
and shall be replaced by a valid and enforceable provision which so far as
possible achieves the same objectives as the severed provision was intended
to achieve, and the remaining provisions of this Agreement shall continue
in full force and effect.
19 Headings. The section headings used herein are for reference and
convenience only and shall not enter into the interpretation hereof.
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Dates Referenced Herein and Documents Incorporated by Reference
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