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THIS MASTER
DISTRIBUTION AGREEMENT (this “Agreement”), dated effective as of the Final Closing Date of that certain Membership
Interest Purchase and Sale Agreement dated January 22, 2024, by and between Excess Telecom, Inc., and KonaTel, Inc. (the
“PSA” or the “Purchase Agreement” and such date being the “Effective Date”) is entered into by
and among (i) Excess Telecom, Inc., Nevada corporation, having its principal place of business located at 3773 Howard Hughes
Parkway, Suite 590S, Las Vegas, Nevada (hereinafter referred to as “Excess Telecom”); (ii) KonaTel, Inc., a Delaware
corporation , having its principal place of business located at 500 N. Central Expressway, Suite 202, Plano, Texas75074
(hereinafter referred to as “Distributor”) and (iii) IM Telecom, LLC, an Oklahoma limited liability company (hereafter
“IM Telcom”). Excess Telecom, Distributor and IM Telecom may be referred to herein each individually as a
“Party” or collectively as the “Parties.”
WHEREAS, Distributor
is in the business of providing marketing assistance for wireless telecommunications services, acquiring and distributing wireless handsets
and tablets, shipping such handsets and tablets to customers, and provisioning wireless services pursuant to agreements with third party
providers of wireless telecommunications carriers (the “Distribution Services”);
WHEREAS, IM Telecom
is in the business of offering and providing wireless telecommunications services subsidized by the federal Lifeline program and state
Lifeline programs (“LifeLine”), and the Affordable Connectivity Program (“ACP”) to qualified customers, and offering
and providing handsets and tablets compatible with Wireless Services to such qualified customers;
WHEREAS, IM Telecom
desires to engage and allow Distributor to perform the Distribution Services as set forth herein, and Distributor desires to be so engaged
by IM Telecom;
WHEREAS, pursuant
to the Purchase Agreement, Excess Telecom will purchase 100% of the membership interests in and to IM Telecom (the “Membership Interests”)
from Distributor, and upon consummation of the Final Closing (as defined in the Purchase Agreement) of the purchase and sale of the sale
of the Membership Interests, Excess Telecom will be the sole member of IM Telecom;
WHEREAS, the Parties
are parties to that certain Management Services Agreement of even date herewith (the “Management Agreement”) pursuant to which
Excess Telecom will perform certain services for IM Telecom until the Final Closing Date (as defined in the Purchase Agreement); and
WHEREAS, the Parties
intend that this Agreement will survive the sale of the Membership Interest to Excess Telecom under the Purchase Agreement.
NOW, THEREFORE,
in consideration of the mutual promises and obligations contained in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:
1.
Nature of Business Relationship
The Parties to this Agreement are independent
businesses entering into an arms-length contract in keeping with their pre-existing businesses. This Agreement will not be construed to
create a partnership, joint venture, employment or franchise relationship among Excess Telecom and IM Telecom, or either of them, and
Distributor, and no Party will represent that such a relationship exists. Distributor is solely responsible for all salaries and other
compensation of its respective employees, suppliers, subcontractors, and agents, and for making all deductions and withholdings from employees’
salaries and other compensation and paying all contributions, taxes and assessments. Neither Distributor nor its employees, agents, independent
contractors and/or subcontractors are entitled to participate in any workers’ compensation, retirement, insurance, stock options
or any other benefits afforded to employees of IM Telecom or Excess Telecom. Except as set forth in Section 6.1 and as provided
in the Management Agreement, Distributor has no authority to bind IM Telecom or Excess Telecom to a contract, Distributor is not authorized
to act as an agent for IM Telecom or Excess Telecom, and Distributor will not represent that such a relationship exists. Except as provided
herein, IM Telecom has no authority to bind Distributor to a contract, and IM Telecom is not authorized to act as an agent for the Distributor,
and will not represent that such a relationships exists.
2.
Definitions
2.1.
“Affiliate” of any Person means any other Person directly or indirectly controlling or controlled
by or under direct or indirect common control with such Person. For the purposes of this definition, “control,” when used
with respect to any Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have
meanings correlative to the foregoing. The term “Affiliate” does not include the officers, directors, or employees
of a Person, if the Person is a corporation, and does not include the employees of a Person, if the Person is a limited liability company
or limited partnership.
2.2.
“Affordable Connectivity Fund” or “ACP” shall refer to the United States government-sponsored
program that provides eligible households with a discount on broadband service and connected devices and any similar governmental programs
that may be established providing similar service that may replace, expand or modify the current ACP.
2.3.
“Applicable Telecommunications Laws and Regulations” means Federal Communications Act of 1934,
as amended, regulations or case law of the FCC, applicable state telecommunications laws, and applicable regulations and case law of state
public utility commissions.
2.4.
“DBA” means and includes the names, trade styles, tradenames and lines of business now or
hereafter established or created under which the IM Telecom Program is conducted or offered to End Users, including, without limitation,
the line of business and doing-business-as operation known as “Infiniti Mobile”.
2.5.
“Distributor End User” means the End Users of IM Telcom as of the Term Start Date and any
purchasers of Distributor Products and Wireless Services marketed or distributed by Distributor under this Agreement under the Infiniti
Mobile DBA.
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2.6.
“Distributor Products” shall mean the equipment or hardware, including handsets and tablets,
distributed by Distributor to Distributor End Users pursuant to this Agreement.
2.7.
“Distributor Services” means the Distributor Wireless Services, Distributor Products, Lifeline
services, ACP services and such other ancillary services relating to Lifeline and ACP services offered to Distributor End Users under
the Licenses.
2.8.
“Distributor Wireless Services” means wireless telecommunications services subsidized by the
federal Lifeline program and states that offer state Lifeline funds, and the ACP, provided by Distributor to Distributor End Users in
coordination with Distributor’s underlying carrier(s) under the Licenses.
2.9.
“Effective Date” means the date set forth above.
2.10.
“End User” shall mean each end user of IM Telecom’s (including all DBA’s) Mobile
Products and Wireless Services under the Licenses, for example, an individual customer that meets the Lifeline and/or ACP rules and regulations.
2.11.
“IM Telecom End User” means any End User other than (i) Distributor End Users and (ii) any
End Users receiving products or services under the Infiniti Mobile DBA.
2.12.
“IM Telecom Products” shall mean the equipment or hardware, including handsets and tablets
provided to IM Telecom End Users.
2.13.
“IM Telecom Wireless Services” means wireless telecommunications services subsidized by the
federal Lifeline program and states that offer state Lifeline funds, and the ACP, provided by IM Telecom to IM Telecom End Users in coordination
with IM Telecom’s underlying carrier(s) and the Licenses.
2.14.
“IM Telecom” means IM Telecom, LLC, an Oklahoma limited liability company.
2.15.
“IM Telecom Program” shall refer to the program in which End Users subscribe to Lifeline or
ACP services now or hereafter provided to End Users under the Licenses.
2.16.
“Independent Sales Representatives” (“ISR”) shall mean any individual person that
Distributor approves to market the IM Telecom Program to End Users under the Infiniti Mobile DBA.
2.17.
“Infiniti Mobile DBA” means and includes, without limitation, the DBA presently operated by
IM Telecom in providing LifeLine and ACP program services under Licenses, together with any alterations, operational combinations or mergers
of the Infiniti Mobile DBA with other DBAs that may occur over time, which other DBAs used by Distributor are subject to IM Telecom’s
approval, which approval shall not be unreasonably withheld, conditioned or delayed.
2.18.
“Infiniti Mobile Marks” means, collectively, the tradename “Infiniti Mobile” and
all related trademarks, service marks, trade names, service names, insignia, symbols, logos, decorative designs and other identifying
marks now or hereafter relating thereto.
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2.19.
“Licenses” means the licenses now or hereafter issued under Applicable Telecommunication Laws
and Regulations for the operation of the IM Telecom Program and the Infiniti Mobile DBA and the provision of the Wireless Services and
sales of the Mobile Products.
2.20.
“Lifeline” shall refer to the federal Lifeline program and other state Lifeline programs,
collectively, unless a single Lifeline program is specified.
2.21.
“Person” means any natural person, any unincorporated association, any corporation, any partnership,
any joint venture, any limited liability company, any trust, any other legal entity, or any Governmental Authority.
2.22.
“Territory” shall mean all areas where the ACP and/or Lifeline services are approved by under
Applicable Telecommunications Laws and Regulations to be offered, and including, without limitation, such other areas that IM Telecom
now or hereafter obtains a License to provided Lifeline or ACP services and such areas that IM Telecom now or hereafter markets and distributes
its IM Telecom Products and Wireless Services, to members of the general public who qualify for Lifeline and ACP benefits, subject to
compliance with IM Telecom’s compliance policies and procedures.
2.23.
“Top-Ups” shall mean a purchase of minutes, text messages, and/or data by End User that in
addition to what is included each month in the End User’s Lifeline or ACP plan.
3.
Term and Exclusivity
3.1.
This Agreement will commence as of the Term Start Date (as defined below) and continue for a period of
ten (10) years from the date of the Final Closing under the PSA (“Initial Term”). The Initial Term may be renewed for
successive two (2) year periods (each a “Renewal Term”) unless a Party serves a notice to terminate (90) days prior to
the end of the Initial Term or a Renewal Term. The word “Term” means the Initial Term and any Renewal Terms as provided above.
3.2.
Pursuant to the grant of rights under this Agreement, Distributor or its designated Affiliate shall have
the non-exclusive right to provide the Distributor Services using Infiniti Mobile DBA during the Term of this Agreement, subject to the
other terms herein. Excess Telecom and IM Mobile reserve the right to engage other distributors within the Territory.
3.3.
KonaTel hereby grants to IM Telecom the non-exclusive, non-transferrable and non-sublicensable right and
license to use the Infiniti Mobile Marks and Infiniti Mobile DBA for any purpose that is reasonable or proper in furtherance of this Agreement,
and not for use or license for or to any other distributor of IM Telecom without Distributor’s written consent (the “Infiniti
License”). The Infiniti License will be irrevocable, subject to termination automatically upon the indefeasible satisfaction of
all obligations under this Agreement following the termination or expiration of this Agreement.
3.4.
For purposes of this Agreement and notwithstanding any other provision of this Agreement to the contrary,
the obligations of IM Telecom under this Agreement will be assumed by Excess Telecom in the event it dissolves IM Telecom or otherwise
transfers IM Telecom’s Licenses.
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3.5.
At any time during the Term, Distributor may provide services to End Users under its own licenses or licenses
of its Affiliates and/or cease to procure new Distributor End Users under the IM Telecom DBA and the Licenses.
4.
Termination
4.1.
Either Excess Telecom and IM Telecom, on the one hand, or KonaTel, on the other hand, may terminate this
Agreement for the other’s material breach of this Agreement following written notice specifying the nature of such failure or breach,
and the opportunity for thirty (30) days to cure the breach unless such failure can be cured, but is not in the determination of the non-breaching
Party reasonably susceptible of being cured within said thirty (30) day period (such determination of reasonable being “Cure Period
Reasonability”), in which event such a failure shall not constitute a breach of this Agreement if breaching party commences curative
action promptly following notice of the breach, and thereafter prosecutes such action to completion with all due diligence and dispatch
and actually cures such breach within ninety (90) days.
4.2.
Either Excess Telecom and IM Telecom, on the one hand, or KonaTel, on the other hand, may terminate this
Agreement upon written notice to the other Party if the other Party is found by a court of competent jurisdiction to have committed any
act of fraud, theft, or files for bankruptcy protection.
4.3.
IM Telecom or Excess Telecom may terminate this Agreement if Distributor or its ISRs perform any act which
IM Telecom or Excess Telecom reasonably determines may materially impair, diminish, or otherwise damage, the reputation or goodwill of
IM Telecom or Excess Telecom, including without limitation, customer complaints by a Distributor End User that are excessive relative
to Excess Telecom’s historic complaint rates, or which on an individual basis are more serious or pejorative that Excess Telecom’s
historic complaints, or violations of the Lifeline or ACP rules and regulations which may include in the determination of IM Telecom or
Excess Telecom, individually, or in the aggregate, result in any fine, investigation, suspension of the Licenses held by IM Telecom or
Excess Telecom, and Distributor is unable to affect or provide adequate remedy within thirty (30) days after receipt of written notice
from IM Telecom or Excess Telecom of such event. The Parties agree that the determination of what may injure, or reasonably tend to injure,
the reputation or goodwill of the injured Party is a matter in the sole but reasonable discretion of IM Telecom or Excess Telecom and
shall be based on customary business practices in the industry and Excess Telecom’s or IM Telecom’s documented policies and
procedures.
4.4.
Either Excess Telecom and IM Telecom, on the one hand, or KonaTel, on the other hand, may terminate this
Agreement on ninety (90) days’ notice if Distributor obtains its own licenses, or enters into a distribution agreement with another
party which hold licenses substantially similar to the Licenses.
4.5.
Either Excess Telecom and IM Telecom, on the one hand, or KonaTel, on the other hand, may terminate this
Agreement on thirty (30) days’ notice if there is claimable activity with respect to fewer than Five Thousand (5,000) Distributor
End Users in the preceding ninety (90) day period.
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4.6.
Notwithstanding any provision of this Agreement to the contrary, this Agreement may not be terminated
for convenience or otherwise without cause by Excess Telecom and/or IM Telecom, provided that the non-renewal of the Term shall not be
deemed or construed to be a termination for convenience.
5.
Effect of Termination; Remedies.
5.1.
Upon termination, Distributor shall immediately cease all marketing and distribution efforts with respect
to Distributor Products and Distributor Wireless Services under License of IM Telecom or Excess Telecom, and shall immediately cease all
marketing and distribution efforts with respect to any other IM Products or IM Mobile Services. Distributor shall maintain all data, records
and reports for a minimum of twenty four (24) months after termination and make such data, records and reports available for download
to Excess Telecom and IM Telecom at all times.
5.2.
If IM Telecom or Excess Telecom terminates this Agreement for any reason or no reason, Distributor shall
be entitled to, at Distributor’s sole cost and expense, including the reasonably fees of professionals of Excess Telecom and IM
Telecom in connection with such further acts: (i) receive, within thirty (30) days, the unpaid amount payable under Schedule A
of the Agreement as of the date of termination solely to the extent actually received by IM Telecom, (ii) to continue to receive each
month, for not more than three (3) years, the recurring compensation as provided on Schedule A for each valid customer secured
by Distributor during the term of this Agreement so long as (a) such customer remains active including having usage; and (b) Excess Telecom
and/or IM Telecom continues to receive state and federal Lifeline or ACP funding for such customer (and IM Telecom or Excess Telecom,
as applicable, shall not intentionally cease to allow receipt of such funding) and (iii) transition the customers in clause (ii) above
to another ACP or LifeLine program over such 3-year period; provided, however, the amounts payable pursuant this sentence will in any
event continue to be subject to any clawbacks, fines, judgments, penalties, or other financial obligations arising from litigation, audits,
or enforcement actions by Governmental Authorities. Excess Telecom and IM Telecom shall cooperate with Distributor in effecting the orderly
transfer of customers under clause (iii) above and shall maintain the LifeLine and ACP programs during such transition period.
5.3.
Right of Offset. Excess Telecom and IM Telecom shall have the right to use amounts otherwise payable
to Distributor under this Agreement to offset liabilities or monetary damages that IM Telecom or Excess Telecom actually incurs arising
from Distributor’s activities in connection with this Agreement, including without limitation clawbacks, fines, judgments, penalties,
or other financial obligations arising from litigation, audits, or enforcement actions by Governmental Authorities. Subject to the terms
below, Distributor will forfeit, and have no rights to, any amounts so used to offset actual liabilities or damages to the extent incurred
by IM Telecom or Excess Telecom. IM Telecom shall, in its regular monthly statements, provide Distributor with adequate detail concerning
any charges taken and monies withheld. Upon the termination of this Agreement, all such amounts not used to offset liabilities or damages
that IM Telecom or Excess Telecom incurs arising from Distributor’s activities in connection with this Agreement shall be promptly
refunded back to Distributor, on the latter of (i) the conclusion of the last active pending investigation or proceeding by a government
agency concerning Distributor Products or Wireless Services, and (ii) one (1) year plus five (5) business days
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following the effective date of termination
of this Agreement. If IM Telecom or Excess Telecom reasonably determines at the request of Distributor that any clawback, fine, or penalty
is subject to meritorious and plausibly responsive contest, it will, at the sole and advance cost and expense of Distributor act in good
faith to contest such clawback, fine, or penalty.
6.
Distributor’s Authority & Obligations.
6.1.
Conditional on Distributor’s material compliance with all terms and conditions of this Agreement,
IM Telecom makes a limited grant of non-exclusive authority to Distributor as follows:
6.1.1.
IM Telecom grants to Distributor a non-exclusive, non-transferrable, non-sublicensable right to market
and distribute Distributor Products and Wireless Services solely within the Territory to members of the general public who qualify for
Lifeline and/or ACP benefits, and to enroll properly qualified Lifeline and ACP customers with IM Telecom in accordance with law and with
IM Telecom’s approved enrollment process. Any purchasers of Distributor Products and Wireless Services marketed or distributed by
Distributor shall be the customers of IM Telecom and not customers of Distributor for purposes of the Licenses and Applicable Telecommunication
Laws. Distributor may delegate or perform the Services under this Agreement through current Affiliates of Distributor. All Affiliates
and agents of Distributor, current or future, must be approved by IM Telecom prior to beginning marketing activities or activation of
customers.
6.1.2.
IM Telecom authorizes Distributor, in Distributor’s discretion, to utilize Distributor’s employees
or ISRs within the authorized Territory for the purpose of performing under this Agreement in marketing and distribution of Distributor
Products and Distributor Services to End Users, provided that:
6.1.2.1.Except
for Distributor’s ability to enroll properly qualified Lifeline and ACP customers on behalf of IM Telecom in accordance with law
and with IM Telecom’s enrollment process, neither Distributor nor its employees or ISRs shall have any authority to bind IM Telecom
in any manner whatsoever.
6.1.2.2.Distributor
is solely responsible for selection of its employees and/or ISRs, for negotiating the terms of any contracts or agreements with such employees
or ISRs, and for all payment or compensation to such employees and ISRs.
6.1.2.3.Distributor,
its employees, and any ISRs that Distributor engages for the purpose of performing under this Agreement must adhere to all applicable
laws, including without limitation federal and state regulations for Lifeline and ACP.
6.1.2.4.Distributor
shall adhere to FCC guidelines that prohibit payment of commissions for enrollment representatives and adhere to IM Telecom audit requests
for verification of compensation method.
6.2.
Excess Telecom and IM Telecom each acknowledge and agree that, subject to the Infiniti License, Distributor
owns all rights in and to the Infiniti Mobile Marks and will use the Infinity Mobile Marks in connection with the Distributor Services
and advertising to potential End
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Users, subject in each case to industry
standard guidelines that IM Telecom or Excess Telecom may update through notices sent to Distributor from time to time for purposes of
maintaining compliance with Applicable Telecommunications Laws and Regulations and the Licenses; provided, that any such guidelines provided
by IM Telecom Excess Telecom shall be reasonable and consistent with guidelines followed by IM Telecom or Excess Telecom in its own business
operations. IM Telecom and Excess Telecom shall not, in any manner, represent that either has any ownership in the Infiniti Mobile Marks,
and IM Telecom and Excess Telecom acknowledge that the use of the Infiniti Mobile Marks shall not create in IM Telecom’s or Excess
Telecom’s favor any right, title or interest in and to the Infiniti Mobile Marks but all uses of the Infiniti Mobile Marks pursuant
to this Agreement, if any, shall inure to the benefit of Distributor. Neither IM Telecom nor Excess Telecom shall have any right to use
any of the Infiniti Mobile Marks under this Agreement, except solely in furtherance of the express terms hereof. Distributor may, in its
sole discretion assign the Infiniti Mobile Marks to any third party, provided, that such assignment of the Infiniti Mobile Marks will
not be deemed or construed to be an assignment or transfer by KonaTel of this Agreement or any rights, privileges, or obligations arising
hereunder.
6.3.
During the term of this Agreement, Distributor shall have the right to, (i) facilitate the enrollment
of End Users in the IM Telecom Program under the Licenses for the provision of Distributor Services, (ii) provide areas to display “point
of sale” materials for implementing the IM Telecom Program and procuring customers for Distributor thereunder, (iii) implement and
maintain reasonable physical, technical, administrative, and organizational safeguards to protect against unauthorized access to, or unauthorized
destruction, use, modification, or disclosure of, Confidential Information, (iii) procure compatible devices and tablets in accordance
with FCC and USAC rules and regulations, and to activate service for Distributor End Users on the appropriate network(s) of Distributor’s
underlying carrier(s).
6.4.
Distributor acknowledges that a breach by Distributor of this Agreement with respect to the Licenses under
this Section 6 would cause IM Telecom and Excess Telecom irreparable damages, for which an award of damages would not be adequate compensation
and agrees that, in the event of such breach or threatened breach, IM Telecom and Excess Telecom will be entitled to equitable relief,
including a restraining order, injunctive relief, specific performance and any other relief that may be available from any court without
necessity of bond or proof of actual damages, in addition to any other remedy to which IM Telecom or Excess Telecom may be entitled at
law or in equity. Such remedies shall not be deemed to be exclusive but shall be in addition to all other remedies available at law or
in equity, subject to any express exclusions or limitations in this Addendum or the Agreement to the contrary.
7.
Additional Distributor Obligations, Duties, and Warranties
7.1.
Distributor shall perform its duties under this Agreement in a legal, professional and ethical manner
and in compliance with all applicable laws, rules, regulations, and orders of the United States, and any other relevant government agencies
(including, without limitation, the Federal Communications Commission (“FCC”), the Universal Service Administrative Company
(“USAC”) and state utilities/public service commissions) with jurisdiction over either Party or its activities in the performance
of its obligations under this Agreement. The parties specifically agree that state and federal rules governing the federal Lifeline program
as established by 47
8
U.S.C. §254 and 47 C.F.R. §
54.400-417, apply to the activities of Distributor, IM Telecom, and Excess Telecom.
7.2.
Distributor agrees (i) to comply with any and all policies and procedures prescribed by the regulatory
authorities governing Lifeline and ACP for the solicitation and enrollment of End Users on the IM Telecom Program, and (ii) to comply
with any and all standards regarding the Distributor Products as set forth by the regulating authorities of Lifeline and ACP.
7.3.
Neither Distributor, nor any of its sales personnel, employees, agents or representatives are authorized
to, and will not, make any, representation, warranty or covenant, whether in writing or orally, on behalf of IM Telecom or Excess Telecom,
other than as approved by IM Telecom or Excess Telecom in writing, in advance of the delivery of such representation, warranty, or covenant.
Distributor shall not commit any act or omission that it knows, or reasonably should know, may reflect unfavorably on IM Telecom or Excess
Telecom or otherwise diminish or impair its reputation or goodwill. Distributor shall not misrepresent any prices, products, services
or other matters offered by IM Telecom or Excess Telecom, including, without limitation, with respect to ; provided, that, solely to the
extent any misrepresentation is may actually be fully cured by doing so, Distributor may remedy any such misrepresentation by undertaking
a corrective plan, including, without limitation, offering concessions at KonaTel’s direct expense to all adversely affected End
Users, that is reasonably acceptable to IM Telecom or Excess Telecom. Distributor shall require all of its employees, ISRs, and subcontractors
or independent contractors to abide by all of the requirements of this Agreement. Distributor shall cooperate with IM Telecom and Excess
Telecom to resolve any actual, or potential, instances of non-compliance with the policies and procedures as set forth by the regulatory
authorities, IM Telecom, or Excess Telecom governing Lifeline and ACP. Distributor further acknowledges that enrollment of Distributor
End Users must be materially consistent with IM Telecom or Excess Telecom procedures and policies.
7.4.
Distributor agrees to meet with IM Telecom or Excess Telecom representatives periodically when reasonably
requested by IM Telecom or Excess Telecom to discuss marketing and distribution activities, provisioning issues, problem resolution, and/or
other topics related to the Parties’ performance under this Agreement.
7.5.
Distributor shall assure that all ISRs signed up by the Distributor are familiar with all federal and
state regulations, and policies and procedures of IM Telecom and Excess Telecom, and will distribute IM Telecom Products and Wireless
Services in compliance therewith, prior to such ISRs marketing or distributing any Mobile Products to End Users. Excess Telecom offers
a voluntary training for individuals who wish to distribute IM Telecom Products and Wireless Services, and any of Distributor’s
ISRs may participate in such Excess Telecom voluntary training if they so elect. Distributor shall timely respond to all questions, problems
or other issues of ISRs, and shall visit all Distributor ISRs, as needed, to confirm compliance with state and federal regulations for
Lifeline and ACP. If IM Telecom or Excess Telecom determines in its reasonable discretion that an ISR is not complying with ACP and/or
Lifeline rules, or IM Telecom or Excess Telecom policies and procedures, Distributor must not circumvent IM Telecom’s or Excess
Telecom’s termination of access to IM Telecom and Excess Telecom systems by such ISR , IM Telecom or Excess Telecom may terminate
any such ISR’s system access.
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7.6.
Distributor will provide customer service representatives at the sole expense of Distributor to serve
Distributor End Users (including without limitation Distributor’s ISRs).
7.7.
Distributor, at its sole expense, will provide Distributor Products to Distributor End Users who have
been acquired by Distributor or Distributor’s representatives. Such Distributor Products will be activated only upon Distributor
End User’s qualification for Lifeline or ACP. Such handsets or tablets will be enabled to provide Distributor End Users access to
emergency (E-911) services and will meet all applicable governmental standards and regulations (including standards pertaining to disabled
customers). All tablets must be approved by USAC or the FCC before being distributed for the ACP. Distributor agrees to any and all inspections
required by IM Telecom or Excess Telecom to ensure compliance with this provision. Distributor will be responsible for all costs related
to maintaining the Distributor Products.
7.8.
Distributor will pay all income taxes on compensation received pursuant to this Agreement and will further
pay all use, sales, value-added, and ad valorem taxes on property owned and used by Distributor in fulfilling Distributor’s duties
under this Agreement. Distributor will also pay any and all payroll taxes for its employees who may be engaged in activities to fulfill
Distributor’s duties under this Agreement.
7.9.
Distributor shall be solely responsible for all expenses incurred in Distributor’s performance under
this Agreement, including without limitation the costs of materials used for marketing and distribution, and travel expenses. Distributor
shall be responsible for marketing and marketing costs, and for developing and utilizing effective marketing techniques and materials.
7.10.
All marketing and advertising materials must be approved in writing by IM Telecom or Excess Telecom prior
to dissemination or use to ensure that they (i) do not misrepresent Distributor Products or Distributor Wireless Services, and (ii) comply
with all state or federal rules and regulations. Such approval shall not be unreasonably withheld.
7.11.
Distributor may market, distribute and/or represent IM Telecom’s Products and Wireless Services,
in geographic Territories approved by IM Telecom or Excess Telecom.
7.12.
Each of Distributor, on the one hand, and IM Telecom and Excess Telecom, on the other hand, agree that,
during the Term and for a period of three (3) years following the Term (the “Restricted Period”), such Party or Parties, and
any person or entity acting on behalf of, under the control of or otherwise in affiliation with such Party or Parties, may not directly
or indirectly do any of the following: (i) intentionally solicit, call on, divert, take away, influence or induce any of the other Party’s
or Parties’ (as the case may be, the “Other Party”) (a) client, customers, or distributors or prospective customers
or distributors (wherever located) with respect to goods, products or services that are competitive with the Other Party’s business,
or (b) suppliers or vendors or prospective suppliers or vendors (wherever located) to supply materials, resources or services to be used
in connection with goods or services that are competitive with those of the Other Party’s business, or in a manner that would materially
and adversely affect the Other Party’s relationship with such persons; (ii) hire, solicit, or take away any person or entity who
or which was an employee of or service provider or consultant to the Other Party within the twelve (12) month period prior to the date
of such hiring, solicitation, or taking away, or is or becomes at any time during the Restricted Period an employee or service provider
or consultant
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of the Other Party or any of its affiliates;
or (iii) directly or indirectly assist any person or entity to take or attempt or offer to take any of the foregoing actions described
in this Section; provided, however, the foregoing provisions of this Section will not be deemed or construed to restrict general solicitations
that may, without specific intent, violate the foregoing terms of this Section.
7.13.
Distributor acknowledges and agrees that this twenty-four (24) month non-solicitation provision is reasonable
both in time and scope, and that Distributor has received adequate consideration under this Agreement for this provision.
8.
Operational Obligations and Duties of the Parties
8.1.
For Distributor End Users Distributor will provide and manage the services and products of an Operations
Support System (“OSS”) provider, a compliance and billing provider, a tax service provider, legal and regulatory affairs provider(s),
call center, an airtime service provider, and other administrative duties.
8.2.
Distributor is responsible for paying its underlying carrier(s) for monthly recurring charges for cost
of service for Distributor End Users.
8.3.
IM Telecom will submit all necessary forms to USAC for reimbursements for the provision of Lifeline and
ACP services and will collect all amounts provided by USAC for all End Users. IM Telecom will further manage all audit requests from any
governmental or quasi-governmental entity (such as USAC) pertaining to Lifeline/ACP or service provisioning, usage, and payments and Distributor
will participate fully and in a transparent and adequately timely manner as requested by IM Telecom.
8.4.
IM Telecom will review all orders or applications for IM Telecom Products and IM Telecom Wireless Services
obtained by Distributor (or Distributor’s ISRs) prior to final acceptance of such customers, and IM Telecom must give its approval
to all new prospective customers and be satisfied that such customers are qualified to receive Lifeline or ACP services before any IM
Telecom Wireless Services are provided to customers, or before any IM Telecom Mobile Products are provided to End Users. IM Telecom’s
review process will be performed in a reasonable and timely manner using best efforts, of a similar nature to those it would normally
undertake with its own prospective customers. IM Telecom will promptly communicate all such review processes and results with reasonable
specificity to Distributor and Distributor shall have the opportunity to address, substantiate and contest the qualifications of any new
prospective customers.
8.5.
IM Telecom shall, at its expense (but without prejudice to Distributor’s obligations under this
Agreement), maintain, or cause to be maintained, all Licenses for the IM Telecom Program and provision of the Lifeline and ACP services
in good standing during the term of this Agreement.
8.6.
Distributor will be solely responsible for:
8.6.1.
Distributor’s call center operations, including telephone costs, customer service, and review queue;
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8.6.2.
Wages and salaries of Distributor employees;
8.6.3.
Customer management functions, which may include but not limited to:
8.6.3.1.Sending
non-usage text and email alerts;
8.6.3.2.30-day
non-usage disconnects; and
8.6.3.3.Form 497
reporting.
8.7.
Distributor shall be solely responsible for the payment of all government-imposed taxes, surcharges and
fees related to the sale of Distributor Products and Distributor Wireless Services to Distributor End Users, including but not limited
to 911 fees and municipal, county, state, or other taxes, as well as any other fees related to the services, subject to Schedule A which
is attached hereto.
8.8.
Distributor shall be solely responsible for the procurement of all Distributor Products for enrollment
of Distributor End Users.
9.
Payment
9.1.
The agreement of the Parties with respect to compensation and distribution of anticipated revenues (including
revenues derived from USAC payments, individual state Lifeline payments, ACP payments, and monthly Top-Ups) and are outlined in Schedule
A attached hereto, the terms of which are incorporated herein by reference.
9.2.
Payment of customer-related fees will be based on a flat fee basis, and IM Telecom shall pay Distributor
in accordance with Schedule A hereto to compensate Distributor for the duties and obligations provided and fulfilled by Distributor. Specifically,
payments made to Distributor shall reflect the Distributor portion of revenue less IM Telecom’s expenses and fees, as set forth
in Schedule A. Such payments will be made not later than three (3) business days following IM Telecom’ receipt of amounts received
from USAC, and/or individual states, for the provision of Lifeline and ACP services to those customers who have been acquired by Distributor
or Distributor’s representatives and who subscribe to Distributor Products and Distributor Wireless Services.
9.3.
Distributor will cooperate fully with IM Telecom in any audit or investigation or request for information
by any governmental authority including any quasi-governmental authority such as USAC pertaining to Distributor Products or Distributor
End Users and who subscribed to Distributor Products and Distributor Wireless Services. This duty to cooperate will survive any event
of termination described in Section 5 or a period of three (3) years.
9.4.
Distributor agrees that any and all payments to be made by IM Telecom or IM Telecom under this Agreement
to Distributor shall be subject to a chargeback in the form of deductions from future payments to reimburse IM Telecom for any and all
regulatory fines that have been actually assessed to IM Telecom and deemed by a Governmental Authority to be owed, taxes, or fees (including
911 fees) related to providing wireless service to Distributor End Users under the Infiniti Mobile DBA, or chargebacks or adjustments
to previous payments made by USAC
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or any other source as a result of findings
that customers under the Infiniti Mobile DBA are or were ineligible for Lifeline or ACP services or Mobile Products by the applicable
Governmental Authority. If the payments due to Distributor the month following discovery of such fines, taxes, fees, or chargebacks do
not completely satisfy all amounts owed to IM Telecom, Distributor will pay the difference directly to IM Telecom within thirty (30) calendar
days of notice thereof together will proper supporting documentation, as reasonably determined by IM Telecom. IM Telecom and IM Telecom
will use commercially acceptable efforts to negotiate fees and payment terms to mitigate the fines or penalties. Distributor hereby agrees
to comply with all IM Telecom or IM Telecom agreed settlements relating to Distributor End Users in accordance this the terms above; provided.
9.5.
In the event of any compliance investigation, audit, or proceeding initiated by a Governmental Authority
or as part of an internal regulatory audit which involves any act or omission by Distributor in connection with the performance of the
Distributor Services accordance with this Agreement, IM Telecom may, in its sole discretion, withhold any or all payments due to Distributor
in accordance with the terms hereof. In the event such compliance investigation is initiated as part of an internal regulatory audit,
individual payments may not be withheld for any period in excess of thirty (30) days, provided, that, such period will extend to up to
ninety (90) days if IM Mobile or Excess Telecom provide notice that such investigation may reasonably take more than thirty (30) days
(such determination being “Investigation Withholding Reasonability”). In the event such investigation, audit, or proceeding
results in a determination that Distributor (1) failed to materially comply with any written policy or regulation, or (2) failed to materially
comply with any statute, rule, or regulation applicable to Distributor under this Agreement, then Distributor shall forfeit payments owed
to Distributor for the sales of IM Telecom Products and IM Telecom Wireless Services which are determined by either IM Telecom or any
governmental or quasi-governmental authority (such as USAC) to be invalid, unlawful, or not in compliance with applicable laws or regulations,
and to the extent of any and all costs, expenses, damages, or losses incurred by IM Telecom as a result of such failures. IM Telecom’
remedies under this paragraph, including such forfeiture, shall be in addition to any other remedies available to IM Telecom under this
Agreement or applicable law. IM Telecom shall give Distributor prompt notice of any such determination for forfeiture, and Distributor
may within 30 days after receipt of such notice, (i) file suit for judicial review of the validity of such forfeiture or (ii) initiate
the Dispute Resolution procedures in Section 5.5 above. Failure to file such suit or to initiate the Dispute Resolution procedures
in Section 5.5 above within said 30-day period will constitute acceptance by Distributor of the forfeiture.
10.
Indemnification
10.1.
Distributor shall indemnify, defend, and hold Excess Telecom and IM Telecom, together with their respective
affiliates, and such parties respective shareholders, officers, directors, employees, agents, affiliates, and their respective successors
and assigns (“IM Telecom Indemnitees”) harmless from any and all losses, damages, liabilities, deficiencies, claims, actions,
judgments, settlements, interest, awards, penalties, fines, costs or expenses of whatever kind, including reasonable attorneys’
fees, fees and the costs of enforcing any right to indemnification under this Agreement and the cost of pursuing any insurance providers
(collectively, “Losses”), incurred by IM Telecom Indemnitees relating to any claim or demand alleged or asserted by a third
party that arise from or in connection with, or relate to
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(1) Distributor’s or ISRs
exercise of rights or privileges under this Agreement or performance of its obligations pursuant to this Agreement, including but not
limited to offering for sale or sale of IM Telecom Products and Wireless Services, (2) any breach of any representation, warranty, covenant,
or agreement in this Agreement by Distributor or ISRs, (3) any negligent or willful acts or omissions of Distributor, its employees,
agents, or subcontractors resulting in any bodily injury or death to any person or loss, disappearance or damage to tangible or intangible
property; (4) any infringement, misuse or misappropriation of any third-party intellectual property rights by Distributor, its employees,
agents, or subcontractors; (5) any failure to comply with applicable laws, rules or regulations by Distributor, its employees, agents,
or subcontractors; (6) any action initiated by Distributor’s employees, agents, or subcontractors against IM Telecom or Excess Telecom
for wages, fringe benefits, other compensation, or similar claims under applicable law; (7) any employment related claims or demands made
by the employees or contractors of Distributor, including, without limitation, any claim of co-employment by virtue of Distributor’s
exercise of rights and privileges hereunder, or/and (8) any and all fees, costs and expenses, including, without limitation, reasonable
attorneys’ fees incurred by or on behalf of IM Telecom or Excess Telecom in the investigation of or defense against any and all
the foregoing Claims.
10.2.
The indemnification obligations imposed by this section includes, but is not limited to court costs, punitive
or exemplary damages, and reasonable attorney’s fees.
10.3.
Subject to Section 12 below, Disclaimer of Warranties, IM Telecom shall indemnify, defend and hold harmless
Distributor, its officers, directors, employees, agents, affiliates, successors and permitted assigns (each, an “Distributor Indemnitees”)
against any and all Losses relating to any claim of a third party to the extent primarily resulting from IM Telecom’s gross negligence,
willful misconduct or uncured material breach of this Agreement, or to the extent relating to any employment related claims or demands
made by the employees or contractors of IM Telecom (excluding any person that is an employee or contractor of IM Telecom, LLC as of the
Effective Date, or who or which is engaged at the direction of Distributor); provided, however, to the extent IM Telecom may receive a
recovery of Distributor’s Losses from a third party that is not an IM Telecom Indemnitee or an insurer of any of them, IM Telecom
will exercise commercially reasonable efforts to provide Distributor with the benefit of such recovery.
11.
Insurance
11.1.
Distributor shall at all times during the term of this Agreement, and for three (3) years thereafter,
maintain in full force and effect at its sole expense, a comprehensive general liability insurance policy in protection of Distributor
and IM Telecom, its officers, elected officials, boards, agents and employees for any and all damages and penalties which may arise as
a result of Distributor’s Services under this Agreement. The policy shall name Distributor as insured and IM Telecom and Excess
Telecom as an additional insured and must have a single occurrence limit of not less than two million dollars ($2,000,000), an aggregate
limit of not less than three million dollars ($2,000,000). The deductible on the policy shall be no higher than $100,000. The insurance
required under this paragraph shall be issued by insurers rated in “Best’s Insurance Guide” with a “General Policyholders
Rating” of at least “A-” for “Financial Strength” and a “Financial Size Category” rating of
at least X.
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11.2.
Distributor shall procure and maintain workers’ compensation and employer’s liability insurance
in accordance with the laws of the state during the term of this Agreement.
11.3.
Distributor shall submit to IM Telecom upon periodic request evidence that Distributor has the insurance
required under this Section.
11.4.
Distributor shall ensure that IM Telecom receives at least thirty (30) days’ prior written notice
before any policy is cancelled or materially modified to the extent such notice is provided by the applicable insurance in accordance
with applicable law. If Distributor fails to obtain the necessary coverages after not less than 30 days’ prior notice to Distributor,
IM Telecom may obtain such coverages to the extent reasonable and applicable at Distributor’s expense.
11.5.
Failure to comply with this Section shall constitute a material breach of this Agreement; provided, that
Distributor shall have the right to cure such default in accordance with the term of this Agreement, provided, however, during any period
for which Distributor is in breach of the terms of this Section 11, the limitations of liability will not apply to any claim for which
Distributor is liable or owes indemnification to IM Telecom or any other party.
12.
DISCLAIMER OF WARRANTIES
12.1.
Each Party acknowledges that no Party hereto manufactures or assembles any Mobile Products, and no Party
hereto sells or provides any Mobile Products other than code-division multiple access (“CDMA”) or Global System for Mobile
Communications (“GSM”) voice-enabled devices, and that no IM Indemnitee has any responsibility, obligation, or liability for
any Mobile Products distributed under this Agreement, and provides no warranties for such Mobile Products.
12.2.
THE PARTIES ACKNOWLEDGE THAT THE PRODUCTS AND MOBILE PRODUCTS PROVIDED BY AN IM INDEMNITEE UNDER THIS
AGREEMENT ARE PROVIDED “AS IS,”“WITH ALL FAULTS” AND WITHOUT ANY WARRANTY. TO THE MAXIMUM EXTENT PERMITTED BY
LAW, IM TELECOM AND EXCESS TELECOM EACH DISCLAIMS ANY AND ALL WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE
IMPLIED WARRANTY OF MERCHANTABILITY AND THE IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, WHETHER ARISING BY A COURSE OF DEALING,
USAGE OR TRADE PRACTICE OR COURSE OF PERFORMANCE.
13.
LIMITATION OF LIABILITY
13.1.
SUBJECT TO SECTION 13.2 BELOW, NO PARTY SHALL, UNDER ANY CIRCUMSTANCES, BE LIABLE TO ANOTHER FOR CONSEQUENTIAL
OR INCIDENTAL DAMAGES INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, EVEN IF SUCH PARTY HAS BEEN APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES
OCCURRING. UNDER NO CIRCUMSTANCES SHALL A PARTY BE LIABLE TO THE OTHER PARTY BEYOND THE AMOUNT IT RECEIVED UNDER THE AGREEMENT.
13.2.
The limitations on liability set forth in Section 13.1 do not apply to liability arising from (1) a Party’s
duty to indemnify the other under this Agreement; (2) a breach of a Party’s
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confidentiality obligations under this
Agreement; or (3) any infringement, misuse or misappropriation of any Intellectual Property rights in any material respect, including,
without limitation any breach by Distributor of Section 6.
13.3.
Subject to the other provisions of this Section 13, Distributor’s sole remedy for breach
of this Agreement by IM Telecom will be an action at law for actual damages incurred by Distribution from such breach.
14.
Entire Agreement
This Agreement, including the exhibits
and schedules attached hereto and the documents and instruments referred to herein, embodies the entire agreement and understanding of
the Parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, representations, warranties,
covenants or undertakings, other than those expressly set forth or referred to herein. This Agreement, and any documents and instruments
contemplated hereby, supersedes all prior agreements and undertakings between the Parties with respect to such subject matter. If any
term or provision of this Agreement shall be found to be illegal or unenforceable, then notwithstanding such illegality or unenforceability,
this Agreement shall remain in full force and effect, and such term or provision shall be deemed to be deleted. The Parties specifically
agree that the attached Schedule A and any exhibits are incorporated by reference herein as a part of this Agreement, the same as if set
forth in the body hereof.
15.
Amendments
This Agreement may be amended, modified
or supplemented only by an instrument in writing executed by the Party against which enforcement of the amendment, modification or supplement
may be sought.
16.
Assignment and Assumption
Except as expressly provided below, this
Agreement may not be assigned by any Party at any time without the written consent of the other Parties, and any attempt to do so shall
be void and of no effect. Notwithstanding the foregoing limitations on the assignment of this Agreement to the contrary, any Party to
this Agreement may assign its rights under this Agreement without the consent of the other Parties, if the assignment is made to an Affiliate,
or an entity acquiring all or substantially all of its assets or business of such transferring Party; provided, that the transferring
Party will, prior to the effectiveness of such assignment, cause such Affiliate or the party acquiring the assets of such transferring
Party to assume the obligations of such Party under this Agreement.
17.
Governing Law, Jurisdiction and Venue
This Agreement will be effective and
binding only when executed by an authorized representative of each Party. This Agreement shall be governed by the laws of the State of
Nevada, and both parties further consent to jurisdiction by the state and federal courts sitting in Clark County in the State of Nevada.
All notices provided under this Agreement
must be in writing and will be deemed to be duly given after it has been sent by both electronic mail and First Class U.S. mail to the
addresses below, or at such other address as any Party hereto may have furnished to the other Party in writing by pursuant to written
notice under this Agreement:
Distributor agrees that it will take all necessary steps in accordance with industry standards to prevent
the divulgence to any person or entity: (a) Customer Proprietary Information (CPI), Personally Identifying Information (PII), or Customer
Proprietary Network Information (CPNI), or protected health information of any person learned as a result of performing under this Agreement
in violation of applicable law; (b) the names, addresses, telephone numbers, or other personal data of IM Telecom’s customers or
prospective customers; or (c) the contents of any communications by IM Telecom’s customers.
18.2.
Both Parties agree to keep confidential and not disclose or use, except in performance of its
17
obligations under this Agreement, confidential
or proprietary information related to each party’s business that is learned in connection with this Agreement, including without
limitation: information relating to both Parties’ products or technology, price lists, customer lists (including without limitation
the names, addresses, telephone numbers, email addresses or other identifying or contact information pertaining to persons or concerns
that are, were, or are likely to become IM Telecom customers), business plans, processes, trade secrets, know-how, ideas, inventions (whether
patentable or not), computer programs, names and expertise of employees and consultants, all information relating to customers and customer
transactions and other technical, business, financial, customer and product development plans, forecasts, strategies and information,
any information about the financial or business affairs of IM Telecom, and any information that by its very nature may be reasonably assumed
to be confidential in accordance with industry standards (“Confidential Information”).
18.3.
Each Party shall use reasonable precautions to protect Confidential Information and employ at least those
precautions that it employs to protect its own confidential or proprietary information. “Confidential Information” shall not
include information either party can document (a) is in or (through no improper action or inaction by Distributor) enters the public domain
(and is readily available without substantial effort), or (b) was rightfully in its possession or known by its prior to the receipt from
the other Party, or (c) was rightfully disclosed to it by another person without restriction, or (d) is expressly permitted pursuant to
this Agreement, (e) was independently developed by Distributor by persons without access to such information and without use of any
Confidential Information (f) was required by law or court order. Furthermore, Distributor may disclose the terms and conditions of this
Agreement as is necessary in order for Distributor to make any public disclosures required under federal or state securities laws or regulations.
Distributor acknowledges and agrees that due to the unique nature of IM Telecom’s Confidential Information, there can be no adequate
remedy at law for any breach of its obligations hereunder, that any such breach may allow the Distributor or third parties to unfairly
compete with IM Telecom resulting in irreparable harm to IM Telecom, and therefore, that upon any such breach or any threat thereof, IM
Telecom shall be entitled to appropriate equitable relief in addition to whatever remedies it might have at law. Distributor will notify
IM Telecom in writing immediately upon the occurrence of any unauthorized release of Confidential Information.
18.4.
Except as provided above, neither Party shall disclose the terms of this Agreement to any third party
without the prior written consent of the other Party.
18.5.
Any material breach of this Section will constitute a material breach of this Agreement; provided, that
if the release of the information described in Section 18.1 above is covered by Distributor’s cyber and technology services insurance
policies such release of information shall not constitute a breach under this this Section 18.
19.
Compliance with Laws. The Parties desire and intend that this Agreement and the performance of
the Distribution Services hereunder comply fully with all Applicable Telecommunications Laws and Regulations, and this Agreement shall
be interpreted and applied in such manner as is consistent with all such laws. If the FCC or any state body of competent jurisdiction
determines that any provision of this Agreement violates any communications licenses or the Applicable Telecommunications Laws and Regulations
or the Licenses, the Parties shall use their best efforts to immediately bring this Agreement
18
into compliance therewith, consistent
with the non-violative terms and provisions of this Agreement. It is expressly understood and agreed by the Parties that nothing in this
Agreement is intended to give the Distributor any right which would be deemed to constitute a transfer of “control” (as defined
in the Applicable Telecommunications Laws and Regulations) of IM Telecom of its Business, any or all of its Licenses, or of one or more
of its communications licenses to Distributor.
20.
Miscellaneous
20.1.
Force Majeure. No Party shall be held responsible for any delay or failure to perform hereunder
for which delay or failure is due to acts of God, fire, flood, earthquake, ice storms, or other natural disasters, solar flares, explosions,
severe weather conditions, national or regional emergencies, insurrections, embargoes, a governmental authority’s failure to timely
act, riots or other civil unrest, wars, invasions or hostilities (whether war is declared or not), terrorism threats or acts, strikes,
lockouts, labor disputes, labor stoppages or slowdowns. The impacted Party will promptly notify the other in writing of the occurrence
and details of any force majeure that has caused, or is likely to cause, the notifying Party to fail to perform its obligations under
this agreement and will use diligent efforts to end the failure or delay and ensure the effects of such force majeure event are minimized.
Failure of a Party to perform under this agreement due to the occurrence of a force majeure event lasting more than thirty (30) days will,
upon twenty-four (24) hours’ written notice to the other Parties hereto, represent a ground for termination by a Party of the service
affected by such force majeure, without termination fees or other liability or obligation.
20.2.
No Waiver. The waiver by any Party of any right hereunder, or waiver relative to a failure to perform
or breach by the other Parties hereto, will not be deemed as a waiver of any other right hereunder, or a waiver relative to any other
or subsequent breach of failure of the other Parties hereto of the same or similar or dissimilar nature.
20.3.
Intellectual Property. Distributor acknowledges and agrees that except as specified herein, Distributor
shall have no rights, title or interest in any trademarks, service marks, or other intellectual property (collectively, the “Intellectual
Property”) of IM Telecom or Excess Telecom.
20.4.
Counterparts. This Agreement may be executed in several counterparts, all of which taken together,
shall constitute a single Agreement between the Parties. Each Party acknowledges that it has read and understood this Agreement and that
it has had the opportunity to consult with legal counsel.
20.5.
Headings. The section headings used herein are for reference and convenience only and shall not
enter into the interpretation of this Agreement.
20.6.
Survival. Sections 5 (Termination), 9 (Payment), 10 (Indemnification), 11 (Insurance), 13 (Limitation
of Liability), 16 (Governing Law, Jurisdiction and Venue) and 18 (Confidentiality), of this Agreement will be deemed to survive the termination
or expiration of this Agreement. The Parties further agree that any provisions of this Agreement that by their nature would survive termination
shall so survive.
20.7.
No Third-Party Beneficiaries. This Agreement benefits solely the Parties to this Agreement
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and their respective permitted successors
and assigns and nothing in this Agreement, express or implied, confers to any other Person any legal or equitable right, benefit or remedy
of any nature whatsoever under or by reason of this Agreement.
20.8.
Disputes Generally.
20.8.1.
Upon mutual agreement of the Parties, any dispute arising under this Agreement may be submitted to mediation
upon terms and conditions agreed to by the Parties. If, within five (5) business days after a dispute arises, the Parties have not agreed
to mediation or if the Parties agree to mediation but mediation is unsuccessful and such dispute is not resolved within fifteen (15) days
after submission to mediation, except as otherwise set forth in this Section20.8, any and all disputes, claims and controversies
based on, arising out of, under or in connection with this Agreement or the transactions contemplated hereby (including actions arising
in contract or tort and any claims by a party against another party related in any way to this Agreement), or any course of conduct, course
of dealing, statement (written or verbal) or action of any party, or any exercise by any party of their respective rights under this Agreement
or in any way relating to this Agreement that are brought before a forum in which pre-dispute waivers of the right to trial by jury are
invalid under applicable law (each, a “Dispute”) shall be settled and resolved by binding arbitration in Las Vegas,
Nevada, before a single arbitrator with the JAMS (“JAMS”) pursuant to the then prevailing JAMS Comprehensive Commercial
Arbitration Rules and Procedures except as modified by this Agreement. For the avoidance of doubt, any disagreement among the parties
as to whether a dispute, claim or controversy is subject to arbitration under the terms of this Agreement shall constitute a Dispute.
20.8.2.
Notwithstanding the choice of JAMS Comprehensive Commercial Arbitration Rules and Procedures, solely in
the case of the following Disputes, the Dispute will be resolved pursuant to JAMS Streamlined Commercial Arbitration Rules and Procedures:
20.8.2.1.
Any Dispute solely relating to the determination of Cure Period Reasonability; and
20.8.2.2.
Any Dispute solely relating to the determination of Investigation Withholding Reasonability.
20.8.3.
In reaching a decision on any Dispute, the arbitrator shall be bound by the provisions of this Agreement
and by the law that the parties have selected to govern the enforcement and interpretation of this Agreement. The arbitrator’s decision
on the Dispute shall be a final and binding determination, and such decision may be confirmed and shall be fully enforceable as an arbitration
award in any court having jurisdiction and venue over the parties. The arbitrator shall have exclusive jurisdiction to determine any questions
of arbitrability and any such question shall be governed by the Federal Arbitration Act. Each party agrees to accept service of process
for all arbitration proceedings in accordance with the notice provisions of this Agreement.
20.8.4.
Nothing in this Section20.8 is intended to restrict or prevent a party from (i) joining any party
as a defendant in any action brought by or against a third party; (ii) bringing an action
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in court to effect any attachment or
garnishment; (iii) bringing an action in court to compel arbitration as required by this Section20.8, or solely, in the case of
IM Telecom or Excess Telecom, (iv) seeking equitable or injunctive relief.
20.8.5.
If a Dispute includes multiple claims, some of which are found not subject to this Agreement, the parties
shall stay the proceedings of the Disputes or part or parts thereof not subject to this Agreement until all other Disputes or parts thereof
are resolved in accordance with this Agreement. If there are Disputes by or against multiple parties, some of which are not subject to
this Agreement, the parties shall sever the Disputes subject to this Agreement and resolve them in accordance with this Agreement.
20.8.6.
During the pendency of any Dispute which is submitted to arbitration in accordance with this Agreement,
each of the parties to such Dispute shall bear equal shares of the fees charged and costs incurred by the arbitrator in performing the
services described in this Agreement.
20.8.7.
The prevailing party shall be entitled to reasonable costs of arbitration and legal fees, including reasonable
attorney fees, expert witness fees, paralegal fees, the fees of the arbitrator and other reasonable costs and disbursements charged to
the party by its counsel, in such amount as is determined by the arbitrator.
20.8.8.
THE PARTIES UNDERSTAND THAT EACH PARTY IS CONSENTING TO, AND AGREEING TO PARTICIPATE IN REMOTE PROCEEDINGS
WITH RESPECT TO THE ARBITRATION OF ANY DISPUTE, AND FURTHER AUTHORIZES AND DIRECTS THE ARBITRATOR TO COMPEL THE REMOTE PROCEEDINGS OF
SUCH ARBITRATION.
20.8.9.
Because each party is giving up the right to litigate any Dispute, each party herein further confirms
that it has read and understands the provisions in this Section20.8, and that it has further benefited from the advice of counsel.
Additionally, by becoming a party to this Agreement, each party is voluntarily giving up important constitutional rights to trial by judge
or jury, as well as rights to appeal. Each party understands that it has the right to have an independent attorney of its choice review
this Section20.8, as well as this entire Agreement prior to becoming a party to this Agreement.
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IN WITNESS WHEREOF, the Parties have
executed this Agreement by their respective authorized representatives below:
Distributor’s compensation shall be 100%
of the amount of funds (revenue) collected from the Lifeline and ACP reimbursement funds each month for each End User acquired by the
Distributor (i.e. a Distributor End User) minus the IM Telecom flat monthly fee amounts below for the applicable number of Distributor
End Users for the applicable calendar month period below and expenses incurred by IM Telecom in the provision of IM Telecom Products and
Wireless Services to the Distributor End Users as follows:
1.
A Flat Fee payable to IM Telecom in the amount of $10,000 if less than 100,000 Distributor End Users of
Lifeline (stand-alone), ACP (stand-alone) or Combined LL/ACP (one customer).
2.
A Flat Fee payable to IM Telecom in the amount of $20,000 if 100,000 Distributor End Users but less than
250,000 Distributor End Users of Lifeline (stand-alone), ACP (stand-alone) or Combined LL/ACP (one customer).
3.
A Flat Fee payable to IM Telecom in the amount of $30,000 if 250,000 Distributor End Users or more of
Lifeline (stand-alone), ACP (stand-alone) or Combined LL/ACP (one customer).
The Flat Fee amounts above will be determined on a
monthly basis and based on the applicable number of Distributor End Users for such monthly period.
Reductions to Payments to Distributor for IM Telecom’s Expenses & Fees
Deducted from IM Telecom’s payments to Distributor
Applicable state and local taxes, fees, and surcharges.
Fees imposed on active Distributor End Users
100% of applicable fees, will be remitted by IM Telecom to Distributor
Dates Referenced Herein and Documents Incorporated by Reference
