Common use of Commitment Ports Clause in Contracts

Commitment Ports. From January 1, 2006, AOL may decommission the ports priced at [****] Commitment Ports (referenced in Section 4 above (the “[****] Commitment Ports”)) based on the same percentage as the monthly decline in the total amount of AOL’s dial-up traffic across all third party networks between calendar months, if any. The monthly percentage decline in AOL traffic will be determined based on the average daily hours of dial-up traffic across all AOL third party dial-up access networks (“Average Daily Hours”), based on the following formula: [****] AOL will have the right to decommission any physical ports on the Level 3 network as of the 15th day of the calendar month following the measurement periods outlined above. On or about the first day of each calendar month, AOL will provide a non-binding estimate of the anticipated Average Daily Hours, Monthly Percentage Decline, and Monthly Decommissioning Amount for the most recent month. By the 15th day of the month, AOL will provide formal notice of the actual number of ports to be decommissioned for the month as determined based upon the actual Average Daily Hours, Monthly Percentage Decline and Monthly Decommissioning Amount calculations for the most recent month (and will provide Level 3 with the Average Daily Hours and the Monthly Percentage Decline used in such determination). Any such ports shall be considered cancelled (and billing shall cease) as of the 15th day of that month. For example, if Average Daily Hours across all third party networks is [****] in March of 2006 and Average Daily Hours across all third party networks is [****] in April of 2006, the Monthly Percentage Decline in hours is [****] during the month of April 2006. AOL would therefore have a right to decommission [****] of the then current number of [****] Commitment Ports (such that if there were [****] Commitment Ports, AOL could decommission [****] of them). On or about May 1, 2006, AOL would provide a non-binding estimate of the anticipated Average Daily Hours and Monthly Percentage Decline for the Month of April and the expected port decommissioning amount (if any). AOL would then provide a formal notice by May 15, 2006 with the quantity and location of ports to be decommissioned with effect from May 15, 2006 (and will provide Level 3 with the Average Daily Hours and the Monthly Percentage Decline used in determining the quantity of ports to be decommissioned). From May 15, 2006, AOL would retain [****] ports at [****]/port/month.

Appears in 2 contracts

Sources: Managed Modem Agreement (AOL Inc.), Managed Modem Agreement (AOL Inc.)