Exhibit 10.20
(EDS LETTERHEAD)
December 16, 1996
Allin Communications Corporation
000 Xxxxxxxxx Xxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: X. Xxxxxx Xxxxxxx
Re: Authorization Letter No. 1996-01
Dear Xx. Xxxxxxx:
This letter will confirm the mutual understanding and agreement of Allin
Communications Corporation ("Customer") and Electronic Data Systems Corporation
("EDS") as to the terms on which EDS will provide to Customer the services and
resources described in this letter, which terms are as follows:
1. This letter is entered into under the provisions of the Master Agreement,
dated effective as of December 16, 1996, between Customer and EDS (the
"Master Agreement"), and, except as otherwise provided in this letter, all
applicable provisions of the Master Agreement are incorporated into this
letter by this reference.
2. The term of this letter will commence on January 6, 1997. (the "AL
Effective Date"), and, unless earlier terminated as provided in this letter
or in the Master Agreement, will continue thereafter until the tenth
anniversary of the AL Effective Date. The term of this letter may be
extended by the mutual written agreement of the parties.
3. During the term of this letter, EDS will provide to Customer the services
and resources described in the attached Exhibit I. The specific allocation
of the services and resources will be set forth in separate written work
orders (each a "Work Order") entered into from time to time by the parties
during the term of this Authorization Letter. Each Work Order shall contain
the following: (a) a Statement of Work describing the services to be
performed, resources to be allocated by EDS, specified performance criteria,
and a list of appropriate deliverables with delivery dates; (b) a price
schedule setting forth any modifications to the payment terms set forth on
Exhibit III; (c) a designation of the Team Leader, as appropriate, and the
Customer Team Leader, each of whom shall function as the point of contact
for the respective parties for the services and resources identified in the
Work Order; (d) any other terms and conditions appropriate to the services
and resources provided under a given Work Order. The EDS individual who
will have management responsibility for EDS in connection with this letter
is also designated in the attached Exhibit II.
4. In connection with the provision of those EDS services and resources,
Customer will provide to EDS the Customer support services and resources
described in the attached Exhibit II. The specific Customer support
services and resources will be set forth in the applicable Work Order.
The Customer individual who will
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have management responsibility for Customer in connection with this letter
is also designated in the attached Exhibit II.
5. For the services and resources provided by EDS to Customer under this
letter, Customer will pay to EDS the amounts specified in the attached
Exhibit III.
6. The services and resources provided to Customer by EDS under this letter
will also be subject to the additional provisions set forth in the attached
Exhibit IV.
7. In the event of any express conflict or inconsistency between the provisions
of a Work Order and the provisions of this Authorization Letter or the
Master Agreement, the provisions of the Work Order will control with respect
to the interpretation of that Work Order; provided, however, that the
provisions of the Work Order will be so construed to give effect to the
applicable provisions of the applicable Authorization Letter and Master
Agreement to the fullest extent possible.
Please indicate your agreement to the foregoing by signing both copies of this
letter and returning one fully-executed copy to EDS.
Sincerely,
Electronic Data Systems Corporation
By: /s/ X. X. Xxxxxxx
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Name: X. X. Xxxxxxx
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Title: President GTSI
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Date: 12-20-96
ACCEPTED AND AGREED:
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Allin Communications Corporation
By: /s/ Xxxxxxx X. Xxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxx
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Title: Chairman/CEO
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Date: 12-16-96
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EXHIBIT I
EDS SERVICES AND RESOURCES
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A. Installation of new and existing ships, consisting of the following
components, and in conformance with the standards of performance set forth in
Exhibit V.
1. Shipboard control center, including the following:
a. Deployment Document
b. Power requirements
c. HVAC capabilities
d. Hardware
e. Software interface development
2. Cabin
a. Television Control Module ("TCM")
3. Plant
a. Radio Frequency (RF) Cabling
b. Network cabling
4. Post Assembly Testing
B. Ongoing Support of Installed Ship-based Operations
I-1
EXHIBIT II
CUSTOMER SUPPORT SERVICES AND RESOURCES
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1. Make available to EDS, as reasonably requested by EDS, management decisions,
personnel, information, approvals, acceptances and access to Customer's
premises, as required by EDS to perform the services stated in the terms of
this agreement and their related activities.
2. Supply training and support for installation and post-installation shipboard
personnel, as required by EDS to perform the services stated in the terms of
this agreement and their related activities, until such time that both
parties agree how and when such support shall be reduced.
3. Supply EDS personnel with on-going support and training for new development
services and critical problem resolution, as required by EDS to perform the
services stated in the terms of this agreement and their related activities.
4. Supply EDS with copies of Customer's operating processes and procedures as
required by EDS to perform the services stated in the terms of this
agreement and their related activities.
5. Provide EDS personnel access to Xxxxxxxx's systems as required for EDS to
perform the services stated in the terms of this agreement and their related
activities.
6. Cooperate with EDS in providing EDS personnel located at Customer's
facilities access to all of EDS' internal systems via the methodologies
requested by EDS. EDS will reimburse Customer for any additional costs
reasonably incurred by Xxxxxxxx as a result of providing EDS' employees with
access to EDS' internal systems.
7. Supply EDS with all pertinent documentation for the current platform and
system for installation troubleshooting, problem resolution and post-
installation activities required to perform the services stated in the terms
of this agreement and their related activities.
8. Provide the EDS Account Manager with facilities and related services (i.e.,
office space, telephones, electric, water, temperature control, office
supplies, etc.) equivalent to a Customer director.
9. Provide EDS employees with facilities and related services (i.e., office
space, telephones, electric, water, temperature control, office supplies,
etc.) equivalent to individual performers employed by Customer.
10. Make provisions for the EDS Account Manager to attend and participate on
regular staff meetings that regard sales, operations and other activities
that affect his/her responsibilities and abilities to deliver services to
Customer and/or Customer's customers, as stated in the terms of this
agreement and their related activities.
11. Provide all travel and other transportation expenses required to provide the
services set forth in this Authorization Letter and their related
activities. Travel would be in accordance with Customer's current travel
policy and guidelines for its employees. All such travel will be acquired by
Customer through its vendors. Expense reports for travel and travel related
expenses will be submitted directly to Customer for payment in accordance
with Customer's existing policies; provided, however, that Customer would be
required to reimburse EDS for such expenses within ten (10) days from the
date EDS submits a request for reimbursement.
12. Supply EDS employees shipboard access, room, board and other reasonable
accommodations and facilities as required to execute installation and post-
implementation activities as required by EDS to perform the services stated
in the terms of this agreement and their related activities.
13. Subject to Customer's discretion, supply EDS, to the extent that they are
made available to Customer by its cruise line customers, with complimentary
cruise passes.
II-1
EXHIBIT III
PAYMENTS TO EDS
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A. Monthly Fee.
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1. Beginning on the AL Effective Date, for a period of six months from the AL
Effective Date (the "Initial Monthy Fee Period"), for each month during
such period, Customer will pay to EDS an amount based upon the following
rates for the following job categories as applicable (each such monthly
fee shall be referred to herein as an "Initial Monthly Fee") and as
adjusted pursuant to the applicable provisions of Exhibit IV:
Monthly
Job Category Billing
Rate Per
Person
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Account Manager $13,412
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Administrative Assistant $ 3,815
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Trainer/Documentation Mgr. $ 5,194
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Project Manager $10,519
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Site Survey Engineer $ 8,617
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Radio Frequency Installer $ 8,617
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Labor Technician $ 5,914
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Software Engineer $ 8,321
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Software/Interface Engineer $ 5,914
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Project Engineer $ 7,236
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Shipboard Operator $ 6,266
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2. Beginning on the first day following the conclusion of the Initial Monthly
Fee Period, and for each month during the remaining term of this
Authorization Letter (and any termination assistance period), Customer
will pay to EDS the following amounts, as applicable (each, a " Base
Monthly Fee"):
Base Monthly Fee Contract
(in $ per month) Month
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To be determined 1-6
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244,481 7-12
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299,559 13-24
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369,987 25-36
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471,289 37-48
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203,453 49-60
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197,528 61-72
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156,132 73-84
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152,526 85-96
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148,084 97-108
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143,771 109-120
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EDS may adjust the Base Monthly Fee for any additional resources that
Customer utilizes in any applicable month. Such adjustments will be based
upon the rates and job categories described above. The Initial Monthly Fee
and the Base Monthly Fee will be due and payable within 30 days after
receipt of the invoice
III-1
by Customer. From time to time, but no more often than once each calendar
year, Customer and EDS agree to meet to discuss merit adjustments to each
job category comprising the Base Monthly Fee, which merit adjustments will
be no more than three percent (3%) per year.
B. Adjustment to the Base Monthly Fee. Customer may permanently adjust the
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Base Monthly Fee by requesting an adjustment to the staff resources
allocated hereunder by providing EDS, in the event of an increase in the
staff resources allocated with one hundred twenty (120) days prior written
notice of the adjustment, and in the case of a decrease in the staff
resources allocated with ninety (90) days prior written notice of the
adjustment, (each a "Resource Adjustment Notice"); provided, however, that
(i) only one Resource Adjustment Notice may be in effect at any time, and
(ii) Customer may provide EDS with no more than two Resource Adjustment
Notices in any calendar year. The Base Monthly Fee will be adjusted to
reflect Customer's request set forth in the Resource Adjustment Notices as
follows: (i) in the case of a Resource Adjustment Notice requesting
additional staff, the Base Monthly Fee will be adjusted on the date the
additional staff are performing services; (H) in the case of a Resource
Adjustment Notice requesting a reduction in staff, the Base Monthly Fee,
will be adjusted on the earlier to occur of (a) the redeployment of the
personnel by EDS or (b) ninety days from the date of the Resource Adjustment
Notice. If during the term of this Authorization Letter, the Customer's use
of the services and/or resources described on Exhibit 1, for any three (3)
consecutive months, varies by an amount equal to or greater than 30% and any
unutilized services and resources cannot reasonably be allocated pursuant to
paragraph C below, then EDS shall have the option to either (i) terminate
this Authorization Letter. or (ii) Customer and EDS shall mutually agree
upon an adjustment to the services or resources allocated to Customer with a
corresponding adjustment to the applicable charges.
C. Other Resource Utilization. Notwithstanding anything contained herein to
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the contrary, to the extent the parties have not entered into an
Authorization Letter with respect to a specific industry, Customer and EDS
may mutually agree to allocate the services and resources set forth herein
to projects outside of the cruise line industry.
III-2
EXHIBIT IV
OTHER PROVISIONS
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Cost of Living Adjustment. If the Consumer Price Index for all Urban Consumers,
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U.S. City Average, for All Items (1982-84 = 100), as published in the Bureau of
Labor Statistics of the Department of Labor (the "CPI"), is at any anniversary
of the AL Effective Date (the "Current Index") higher than the CPI at the
previous anniversary of the AL Effective Date or at the AL Effective Date, as
the case may be (the "Base Index"), then, effective as of such anniversary, all
charges under this Authorization Letter will be increased by the percentage that
the Current Index increased from the Base Index; provided, that in any such
twelve month period, Customer will pay increases in the charges for any increase
of the Current Index over the Base Index up to and including 4% and provided
further that during such period, Customer will not be charged for any increases
of the Current Index over the Base Index which are greater than 4%. In the
event that the Bureau of Labor Statistics should stop publishing the CPI or
should substantially change the content or format thereof, the parties will
substitute therefor another comparable measure published by a mutually agreeable
source; provided, however, that if such change is merely to redefine the base
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year for the CPI from 1982-84 to some other year, the parties will continue to
use the CPI but will if necessary, convert either the Base Index or the Current
Index to the same basis as the other by multiplying such index by the
appropriate conversion factor.
Taxes. Customer will pay all Taxes (as defined below) to EDS at the same time
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and in the same manner that it pays those amounts due to EDS under this
Authorization Letter to which the Taxes relate, and EDS will remit such Taxes to
the appropriate taxing authority. EDS and Customer will cooperate to minimize
and properly calculate any applicable Taxes and, in connection therewith,
Customer will provide any applicable direct pay certificates, resale
certificates, information regarding out-of-state use of materials, services or
sales or other exemption certificates or information reasonably requested by
EDS. EDS will notify Customer of, and will coordinate with Customer, the
response to and settlement of any claims for Taxes that may be asserted by
applicable taxing authorities, it being understood that with respect to any
claim for Taxes arising out of a form or return signed (or which should have
been signed) by a party, such party will have the right to elect to control the
response to and settlement of the claim, but the other party will have the right
to participate in the responses and settlements that are appropriate to its
potential responsibilities or liabilities. If Customer requests EDS to
challenge the imposition of any Tax, Customer will reimburse EDS for the
reasonable legal fees and expenses, including additional tax, penalty and
interest if assessed, that EDS incurs. Customer will be entitled to any refunds
or rebates of Taxes (including additional tax, penalty, and interest) granted to
the extent such refunds or rebates are of Taxes (including additional tax,
penalty, and interest) that were paid by Xxxxxxxx. For purposes of this
Authorization Letter, "Taxes" means any taxes, however designated or levied,
based upon amounts payable to EDS pursuant to this Authorization Letter, upon
this Authorization Letter or upon the services, resources, equipment or other
property provided pursuant to this Authorization Letter, including state and
local taxes, use taxes and any taxes or amounts in lieu thereof paid or payable
by EDS in respect of the foregoing, exclusive in each case, however, of any tax
(including additional tax, penalty, and interest) in respect of any salary,
wage, pension, retirement benefit, or other compensation, or fringe benefit paid
by EDS, of EDS' franchise taxes and taxes based upon the net worth, or any loan,
of EDS, property owned or leased by EDS or gross or net receipts or the net
income of EDS. For purposes of this paragraph, EDS shall include EDS and its
affiliates.
Significant Changes. The charges set forth in Exhibit III are based on there
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being no significant changes to the services or resources contemplated by this
Authorization Letter. Without limitation of the foregoing, a significant change
to such services or resources would be deemed to occur upon (i) a significant
decrease in the number of installations [ships], (ii) a significant increase in
the amount of personnel resources necessary to complete an installation as
described in Exhibit 1, or (iii) significant change to the nature of Customer's
business or operations. With respect to any such significant change, EDS and
Customer would meet to discuss a reasonable adjustment to charges. Any
adjustment win require the consent of the other party, which consent may not be
unreasonably withheld.
IV-1
Insurance Requirements.
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Subject to review and confirmation by Xxxxx, EDS will provide the following:
General Liability Insurance.
Longshoreman's and Harbor Workers Compensation Insurance (USL&H).
IV-2
EXHIBIT V
PERFORMANCE CRITERIA
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EDS and Customer agree that the performance criteria set forth below are subject
to additional due diligence by EDS during the six month start-up period.
Accordingly, EDS and Customer agree that the performance criteria set forth
below may be amended during such six month period by EDS, provided such
adjustments do not adversely impact on-going service agreements or commitments
to Customer's clients or customers and thereafter by mutual agreement. The
following key criteria shall be used as performance standards by which a
Customer will be able to gauge the timeliness, quality and reliability of the
services and resources provided by EDS. These key criteria are guidelines for
levels of timeliness, quality and reliability and are not all inclusive. The
complete list of performance criteria are based upon the entire Customer
documentation library listed as part of this Exhibit as well as any Customer
Client shipboard policies and procedures.
A. Installation
Technical Site Survey - The Technical Site Survey (the "Survey") should
commence within 2 weeks of contract signing and be performed by a qualified
RF Engineer and Project Engineer. The Survey should be 100% complete within
one (1) week of the Survey start date. The Site Survey document and technical
sections of the Deployment document, including all design drawings should be
completed within two (2) weeks of completion of the Survey. The Customer
shall receive five (5) hard copies and one (1) secure electronic copy of
these documents within two (2) days of completion of the documents received
by Customer personnel.
RF Network Installation - The RF Network Installation (RF) should be
completed by the contractually agreed-to completion date. The RF, including
shipboard TV and ITV System RF components, combining network, amps, TCMs,
TVs, connectors and cabling should be properly installed to provide
distortion-free video and audio quality through the complete RF network.
Acceptable signal levels, as agreed to for each design effort, should exist
at each amp input, amp output, and TV RF connector. The initial signal level
values for each amp input and output, at a working low band, midband and the
highest working superband channel and at each TV tap should be provided as
proof of completion as well as being used as the baseline values for
maintenance efforts.
ITV System Installation - The ITV System Installation (ITV) should be
completed by the contractually agreed-to completion date. The ITV should have
all components in proper working condition, including verification that the
RF components of the system satisfy the RF Network Installation quality
levels. RF and digital networking connections, including hubs, cables and
interface cards and connectors should have a greater than 99% rate of
successful packet communications between ITV network devices.
ITV System Interfaces - The ITV System Interfaces (Interfaces), to non-ITV
computers and networks, should be completed by the contractually agreed-to
completion date. The Interfaces should have greater than a 99% rate of
successful packet communications between network devices, with the ability to
100% reliably receive guest information and communicate transaction
information between ITV and non-ITV systems.
Operational Software Installation - Operational Software Installation should
be completed by the contractually agreed-to completion date. All ITV software
should be operational, with all ship specific content installed, including
all operational software, audio, video, graphics and database files.
Installation Specific Documentation - All Installation Specific Documentation
(Specifics) should be completed within one (1) week of the ITV installation.
The Specifics should include all information unique to the ITV installation,
including but not limited to, as built drawings for the RF combining and ship
networks, ITV system rack elevations, layouts, trunk and channel
configurations, channel lineup, and initial RF readings.
V-1
B. Operations
Operator Boarding - The Operator responsible for maintaining proper operation
of the ITV System should have successfully completed the landbased portion of
the ITV System Training and board the ship no later than two (2) weeks prior
to the go-live date of the ITV System. The Operator should become an integral
part of the installation team and completely understand the unique aspects of
the ITV installation before the go-live date.
Operator Answers to Master of the Ship - The Operator is under the authority
of the Master of the Ship and the officers designated to oversee the
operation of the Systems and Services. The Operator shall use his/her best
efforts to comply with the operations manual and other shipboard guidelines
set forth by the Customer Client.
Operational Procedures - The Operator shall understand and effectively
execute the Operational Procedures required to run the ITV system maintaining
a greater than 90% level of guest satisfaction, based upon random guest
surveys initiated by the Customer.
System Operation - Through proper maintenance and servicing, the ITV System
shall be maintained at a 98% average uptime for Interactive Services, with a
98% average rate of equipment operation within each month of operation.
Maintenance Procedures - The Operator shall perform all on-going maintenance
procedures and record the results of maintenance procedures in the Ship's
Log. The maintenance procedures shall include, but not be limited to, RF
amplifier input and output readings at specified low, mid and superband
channels, ITV System audio and video quality levels, proper component
operations, backups, reporting and reconciliation.
Service and Notification Procedures - The Operator shall immediately begin
the investigation of any guest reported problems, or any problems discovered
during normal system operation or maintenance. Problems and resolutions
should be recorded as part of the Ship's Log. Any ITV System failure should
be resolved or reported to Level 2 - Landside Technical Support personnel
within a specified time frame, based upon the following ITV System failure
levels:
. Disabling more than 10% of the ITV System I hour
. Between I and 10% of the ITV System 2 hours
. Less than 1% of the ITV System 24 hours
Decorum and Professionalism - The Operator shall maintain a high level of
decorum and professionalism as the representative of both EDS and the
Customer at each installation.
Other Shipboard System Installations and Operations - For any other type of
shipboard installations, including but not limited to Broadcast Centers,
Information Systems, Property Management Systems, Point of Sale Systems,
Kiosks, Digital Photography Systems, similar levels of timeliness, quality
and reliability apply.
Standards and Practices - All work shall be done in compliance with standards
set forth by the Society of CATV Engineers, Society of Broadcast Engineers,
Electronic Industries Association, and SOLAS maritime regulations.
V-2
