Exhibit 10.1


 




 


 





MASTER OUTSOURCING SERVICES AGREEMENT


 


between


 


IDEARC MEDIA SERVICES—WEST INC.


 


and


 


TATA AMERICA INTERNATIONAL CORPORATION


 


and


 


TATA CONSULTANCY SERVICES LIMITED


 


dated as of


 


October 30, 2009




 





 


 

















 


TABLE OF
CONTENTS


	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I DEFINITIONS; BACKGROUND
  AND OBJECTIVES

  	
  1

  
	
  1.1.

  	
  Definitions

  	
  1

  
	
  1.2.

  	
  Performance and Management by Provider

  	
  1

  
	
  1.3.

  	
  Goals and Objectives

  	
  1

  
	
  1.4.

  	
  RFP

  	
  2

  
	
  1.5.

  	
  Interpretation

  	
  2

  
	
  1.6.

  	
  Structure of the Agreement

  	
  2

  
	
   

  	
   

  	
   

  
	
  ARTICLE II TERM

  	
  3

  
	
  2.1.

  	
  Initial Term

  	
  3

  
	
  2.2.

  	
  Extension

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE III TRANSITION

  	
  3

  
	
  3.1.

  	
  Tower Commencement Date

  	
  3

  
	
  3.2.

  	
  Transition Services

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV SERVICES

  	
  6

  
	
  4.1.

  	
  Overview

  	
  6

  
	
  4.2.

  	
  Services to the Idearc Group

  	
  6

  
	
  4.3.

  	
  Natural Growth and Contraction

  	
  7

  
	
  4.4.

  	
  Certain Idearc Transactions

  	
  7

  
	
  4.5.

  	
  Service Volumes;Insourcing/Resourcing; Special Incentive Pricing

  	
  8

  
	
  4.6.

  	
  New Services

  	
  9

  
	
  4.7.

  	
  Technology and Business Process Evolution

  	
  11

  
	
  4.8.

  	
  Disaster Recovery and Business Continuity

  	
  11

  
	
  4.9.

  	
  Savings Clause

  	
  12

  
	
  4.10.

  	
  Processing Norms

  	
  13

  
	
  4.11.

  	
  Processing Transactions

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE V SERVICE LEVELS

  	
  13

  
	
  5.1.

  	
  General

  	
  13

  
	
  5.2.

  	
  Performance Credits

  	
  13

  
	
  5.3.

  	
  Failure to Perform

  	
  14

  
	
  5.4.

  	
  Performance Review

  	
  14

  
	
  5.5.

  	
  Measurement and Monitoring

  	
  14

  
	
  5.6.

  	
  Productivity Gain-Share

  	
  14

  
	
  5.7.

  	
  Exceptions to Service Level Failures

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI RESOURCES

  	
  15

  
	
  6.1.

  	
  Required Resources

  	
  15

  
	
  6.2.

  	
  Software, Equipment and Third-Party Contracts

  	
  16

  
	
  6.3.

  	
  Required Consents

  	
  18

  
	
  6.4.

  	
  Refresh

  	
  18

  



 


ii

















 


	
  ARTICLE VII SERVICE LOCATIONS

  	
  18

  
	
  7.1.

  	
  Service Locations

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII HUMAN RESOURCE MATTERS

  	
  22

  
	
  8.1.

  	
  General Principles Regarding Provider Personnel

  	
  22

  
	
  8.2.

  	
  Replacement, Qualifications, and Retention of Provider Personnel

  	
  22

  
	
  8.3.

  	
  Hiring of Employees

  	
  24

  
	
  8.4.

  	
  Certain Employee Restrictions

  	
  24

  
	
  8.5.

  	
  Other Personnel Requirements

  	
  25

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX RELATIONSHIP MANAGEMENT

  	
  26

  
	
  9.1.

  	
  Provider Project Executive

  	
  26

  
	
  9.2.

  	
  Idearc Program Manager

  	
  26

  
	
  9.3.

  	
  Governance

  	
  26

  
	
  9.4.

  	
  Annual Reviews

  	
  26

  
	
  9.5.

  	
  Key Provider Personnel

  	
  27

  
	
  9.6.

  	
  Policies and Procedures Manual

  	
  28

  
	
  9.7.

  	
  Service Level Reports

  	
  29

  
	
  9.8.

  	
  Quality Assurance and Provider Internal Controls

  	
  29

  
	
  9.9.

  	
  Change Management

  	
  29

  
	
  9.10.

  	
  Change Control Procedure

  	
  30

  
	
  9.11.

  	
  Compliance with Laws

  	
  32

  
	
  9.12.

  	
  Subcontractors

  	
  33

  
	
  9.13.

  	
  Cooperation with Third-Party Contractors

  	
  35

  
	
  9.14.

  	
  Requirement of Writing

  	
  36

  
	
   

  	
   

  	
   

  
	
  ARTICLE X CHARGES

  	
  36

  
	
  10.1.

  	
  General

  	
  36

  
	
  10.2.

  	
  Invoicing

  	
  37

  
	
  10.3.

  	
  Payment Due

  	
  37

  
	
  10.4.

  	
  Chargeback

  	
  38

  
	
  10.5.

  	
  Proration

  	
  38

  
	
  10.6.

  	
  Refundable Items; Credits

  	
  38

  
	
  10.7.

  	
  Pass-Through Expenses

  	
  38

  
	
  10.8.

  	
  Extraordinary Events

  	
  39

  
	
  10.9.

  	
  Efforts to Reduce Costs and Charges

  	
  40

  
	
  10.10.

  	
  Set Off

  	
  40

  
	
  10.11.

  	
  Disputed Charges

  	
  40

  
	
  10.12.

  	
  Taxes

  	
  41

  
	
  10.13.

  	
  Benchmarking

  	
  43

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI REPRESENTATIONS, WARRANTIES AND COVENANTS

  	
  45

  
	
  11.1.

  	
  Idearc Representations and Warranties

  	
  45

  
	
  11.2.

  	
  Provider Representations and Warranties

  	
  46

  
	
  11.3.

  	
  Additional Provider Warranties

  	
  47

  
	
  11.4.

  	
  Malicious Code; Disabling Code; Spam

  	
  48

  
	
  11.5.

  	
  Pass-Through Warranties; Third-Party Software

  	
  49

  



 


iii

















 


	
  11.6.

  	
  Disclaimer

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII CONFIDENTIALITY

  	
  49

  
	
  12.1.

  	
  Idearc Ownership of Idearc Data

  	
  49

  
	
  12.2.

  	
  Safeguarding Idearc Data

  	
  50

  
	
  12.3.

  	
  Confidentiality

  	
  51

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIII PROPRIETARY RIGHTS

  	
  55

  
	
  13.1.

  	
  Idearc Materials

  	
  55

  
	
  13.2.

  	
  Provider Materials

  	
  56

  
	
  13.3.

  	
  Third-Party Materials

  	
  58

  
	
  13.4.

  	
  Publishing Product

  	
  59

  
	
  13.5.

  	
  General Rights

  	
  60

  
	
  13.6.

  	
  Idearc Rights Upon Expiration or Termination of Agreement

  	
  61

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIV AUDIT RIGHTS

  	
  63

  
	
  14.1.

  	
  Audit Rights

  	
  63

  
	
  14.2.

  	
  SAS 70 Reviews

  	
  66

  
	
  14.3.

  	
  Idearc Internal Control Matters

  	
  67

  
	
   

  	
   

  	
   

  
	
  ARTICLE XV INSURANCE AND RISK OF LOSS

  	
  68

  
	
  15.1.

  	
  Insurance

  	
  68

  
	
  15.2.

  	
  Risk of Loss

  	
  69

  
	
   

  	
   

  	
   

  
	
  ARTICLE XVI INDEMNIFICATION

  	
  69

  
	
  16.1.

  	
  Indemnity by Provider

  	
  69

  
	
  16.2.

  	
  Indemnity by Idearc

  	
  70

  
	
  16.3.

  	
  Infringement

  	
  71

  
	
  16.4.

  	
  Indemnification Procedures

  	
  73

  
	
  16.5.

  	
  Subrogation

  	
  74

  
	
   

  	
   

  	
   

  
	
  ARTICLE XVII LIMITATION OF LIABILITY

  	
  75

  
	
  17.1.

  	
  General Intent

  	
  75

  
	
  17.2.

  	
  Limitation of Liability

  	
  75

  
	
   

  	
   

  	
   

  
	
  ARTICLE XVIII TERMINATION

  	
  77

  
	
  18.1.

  	
  Termination for Cause

  	
  77

  
	
  18.2.

  	
  Termination for Nonpayment

  	
  78

  
	
  18.3.

  	
  Termination for Convenience

  	
  78

  
	
  18.4.

  	
  Termination Upon Provider Investment in or Acquisition of Idearc
  Competitor

  	
  78

  
	
  18.5.

  	
  Termination Upon Provider Change of Control

  	
  79

  
	
  18.6.

  	
  Termination Upon Idearc Change of Control

  	
  80

  
	
  18.7.

  	
  Termination for Change in Law

  	
  80

  
	
  18.8.

  	
  Termination for Provider Insolvency

  	
  80

  
	
  18.9.

  	
  Idearc Rights Upon Provider’s Bankruptcy

  	
  80

  
	
  18.10.

  	
  Termination Fee

  	
  81

  
	
  18.11.

  	
  Partial Terminations

  	
  82

  



 


iv

















 


	
  18.12.

  	
  Equitable Remedies

  	
  82

  
	
  18.13.

  	
  Termination Assistance

  	
  82

  
	
  18.14.

  	
  Extension of Services

  	
  83

  
	
  18.15.

  	
  Termination Assistance to Designees

  	
  84

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIX DISPUTE RESOLUTION

  	
  84

  
	
  19.1.

  	
  Informal Dispute Resolution

  	
  84

  
	
  19.2.

  	
  Continued Performance

  	
  85

  
	
  19.3.

  	
  Binding Arbitration

  	
  86

  
	
  19.4.

  	
  Governing Law; Jurisdiction; Venue

  	
  87

  
	
   

  	
   

  	
   

  
	
  ARTICLE XX FORCE MAJEURE

  	
  88

  
	
  20.1.

  	
  Force Majeure

  	
  88

  
	
   

  	
   

  	
   

  
	
  ARTICLE XXI GENERAL

  	
  90

  
	
  21.1.

  	
  Joint and Several Liability

  	
  90

  
	
  21.2.

  	
  Binding Nature and Assignment

  	
  90

  
	
  21.3.

  	
  Entire Agreement

  	
  90

  
	
  21.4.

  	
  Amendment; Waivers

  	
  91

  
	
  21.5.

  	
  Notices

  	
  91

  
	
  21.6.

  	
  Counterparts

  	
  92

  
	
  21.7.

  	
  Rules of Construction

  	
  92

  
	
  21.8.

  	
  Relationship of Parties

  	
  92

  
	
  21.9.

  	
  Severability

  	
  92

  
	
  21.10.

  	
  Consents and Approval

  	
  92

  
	
  21.11.

  	
  Waiver of Default; Cumulative Remedies

  	
  93

  
	
  21.12.

  	
  Survival

  	
  93

  
	
  21.13.

  	
  Publicity

  	
  93

  
	
  21.14.

  	
  Export

  	
  93

  
	
  21.15.

  	
  No Third-Party Beneficiaries

  	
  94

  
	
  21.16.

  	
  Covenant Against Pledging

  	
  94

  
	
  21.17.

  	
  Order of Precedence

  	
  94

  
	
  21.18.

  	
  Further Assurances

  	
  94

  
	
  21.19.

  	
  Liens

  	
  94

  
	
  21.20.

  	
  Covenant of Good Faith

  	
  94

  
	
  21.21.

  	
  Acknowledgment

  	
  94

  



 


v

















 


	
  EXHIBITS

  	
   

  
	
   

  	
   

  
	
  Exhibit A

  	
  Business Standards Code of Ethics

  
	
  Exhibit B

  	
  Expense Reimbursement Policy

  
	
  Exhibit C

  	
  Information Security Policy

  
	
   

  	
   

  
	
  SCHEDULES

  	
   

  
	
   

  	
   

  
	
  Schedule 1.1

  	
  Definitions

  
	
   

  	
  Attachment 1.1-A       Idearc
  Competitors

  
	
   

  	
  Attachment 1.1-B       Peer
  Group

  
	
  Schedule 3.2

  	
  Transition Plan

  
	
  Schedule 4.8

  	
  Disaster Recovery and Business Continuity Plan

  
	
  Schedule 5.1

  	
  Service Level Methodology

  
	
  Schedule 6.2

  	
  Financial Responsibility Matrix

  
	
  Schedule 9.3

  	
  Governance

  
	
  Schedule 9.6

  	
  Policies and Procedures Manual Outline

  
	
  Schedule 10.1

  	
  Charges

  
	
  Schedule 10.13(b)

  	
  Approved Benchmarkers

  
	
  Schedule 13.3

  	
  Provider Third-Party Materials

  
	
  Schedule 15.1

  	
  Insurance

  
	
  Schedule 18.10

  	
  Termination Fees

  
	
  Schedule 18.13

  	
  Termination Assistance Services

  



 


TRANSACTION DOCUMENTS


 


1.  Account Management (AM)


2.  Book Close (BC)


3.  Ad Production


4.  Pagination


5.  Listings


6.  Verticals


 


vi
















 


MASTER OUTSOURCING SERVICES AGREEMENT


 


This Master Outsourcing
Services Agreement (this “Master
Agreement”) is entered into as of October 30, 2009 (the “Effective Date”)
between Idearc Media Services—West Inc., a Delaware corporation (“Idearc”), and Tata America
International Corporation, operating as TCS America, a New York corporation (“TCS America”) and Tata Consultancy
Services Limited, a company established under the laws of the Republic of India
(“TCSL”) (TCS America and TCSL
collectively referred to herein as “Provider”).


 


WHEREAS, Idearc desires to
outsource certain internal publishing functions to a service provider in the
business of providing such services in order to achieve efficiencies,
scalability, market responsiveness and significant operational cost savings;


 


WHEREAS, on or about July 25,
2008, Idearc issued its Request for Proposal for Full Publishing RFP (the “RFP”) to invite
interested and qualified service providers to submit proposals to provide such
services to Idearc;


 


WHEREAS, Provider is in the
business of providing such services to third parties, and is willing to enter
into the Agreement (as defined below) in order to set forth the terms on which
Provider will provide to Idearc the services described herein;


 


NOW THEREFORE, in consideration
of the mutual promises and covenants contained herein, and other good and valid
consideration, the receipt and sufficiency of which are hereby acknowledged,
Idearc and Provider (collectively, the “Parties” and each, a “Party”) hereby agree
as follows:


 


ARTICLE I


DEFINITIONS; BACKGROUND
AND OBJECTIVES


 


1.1.                              Definitions.  As used in this Master
Agreement, the terms set forth in Schedule 1.1 will have the respective
meanings set forth therein.  Other terms
used in this Master Agreement are defined in the context in which they are used
and will have the meanings therein indicated.


 


1.2.                              Performance
and Management by Provider.  Idearc desires that certain
services presently provided and/or managed by or for Idearc and its Affiliates
be provided and/or managed by Provider. 
Provider has carefully reviewed Idearc’s requirements, has performed all
necessary due diligence, and desires to provide and manage such services for
Idearc as described herein.


 


1.3.                              Goals
and Objectives.  The Parties
acknowledge and agree that the specific goals and objectives of Idearc in
entering into the Agreement are to (i) achieve significant long-term
operational cost savings due to continuous improvement and spreading of fixed
costs, (ii) obtain dynamic access to resources for increased flexibility
to adapt to changing technology and business needs, (iii) convert a
portion of Idearc’s fixed costs to variable costs, (iv) develop enhanced
consumption and cost forecasting capabilities, (v) obtain proactive access
to new technologies that will lower costs to Idearc and that


 


1

















 


facilitates, rather than
constrains, Idearc’s business decisions and strategies, (vi) establish a
relationship whereby Idearc and Provider are allocated reasonable and managed
risk and (vii) continuously improve quality and service.


 


1.4.                              RFP.  Provider has (i) thoroughly reviewed,
analyzed and understood the RFP; (ii) timely raised all questions or
objections to the RFP; and (iii) reviewed and thoroughly understands
Idearc’s current program and operating environments for the activities that are
the subject of the Agreement and the needs and requirements of Idearc during
the Term.  Based on such review and
understanding, Provider currently has the capability to perform in accordance
with the terms and conditions of the Agreement and it will continue to possess
such capability throughout the Term.


 


1.5.                              Interpretation.  The provisions of Sections 1.2 and 1.3
are intended to be a general introduction to the Agreement and are not intended
to expand the scope of the Parties’ obligations or alter the plain meaning of
the terms and conditions of the Agreement, as set forth hereinafter.  However, to the extent the terms and
conditions of the Agreement are unclear or ambiguous, such terms and conditions
are to be construed so as to give the fullest possible effect to the goals and
objectives set forth in Sections 1.2 and 1.3.


 


1.6.                              Structure of the Agreement.


 


(a)                                  Components of the
Agreement.  The “Agreement” consists of:


 


(i)                                     the provisions set forth in this Master Agreement, the
Exhibits and the Schedules referenced herein; and


 


(ii)                                  all of the Transaction Documents executed by the Parties
pursuant to this Master Agreement, including the Appendices and Schedules that
may be referenced in each Transaction Document.


 


(b)                                 Transaction Documents. 
The Services will be described in and be the subject of (i) one or
more Transaction Documents executed by the Parties pursuant to this Master
Agreement and (ii) this Master Agreement.


 


(c)                                  Deviations from Master
Agreement; Priority.


 


(i)                                     Subject to subparagraph (ii) below, in the event of a
conflict, the terms of the Transaction Documents, including the Appendices and
Schedules referenced therein, shall be governed by the terms of this Master
Agreement including the Exhibits and Schedules, unless an individual
Transaction Document expressly and specifically notes the deviations from the
terms of the Master Agreement, Exhibits and Schedules.  In the event of a conflict, the terms of each
Transaction Document shall govern over the terms of the Appendices and
Schedules referenced therein and the terms of the then-current Policies and
Procedures Manual.  In the event of a
conflict, the terms of this Master Agreement shall govern over the terms of the
Exhibits and Schedules attached hereto. 
In the event of a conflict, a


 


2

















 


Change
Order shall govern over this Master Agreement and/or any Transaction
Document(s), Appendices, Schedule(s) and/or Exhibit(s) to which such
Change Order applies.


 


(ii)                                  Notwithstanding the foregoing, any conflict between the list
of provisions set forth below and the terms of any Transaction Document,
Exhibit, Appendix or Schedule shall be resolved in favor of this Master
Agreement, and such provisions may be amended only pursuant to Section 21.4:


 


(A)                              ARTICLE XI -
REPRESENTATIONS, WARRANTIES AND COVENANTS


 


(B)                                ARTICLE XVI -
INDEMNIFICATION


 


(C)                                ARTICLE XVII -
LIMITATION OF LIABILITY


 


(D)                               ARTICLE XVIII -
TERMINATION


 


ARTICLE II


TERM


 


2.1.                              Initial
Term.  The initial term of the
Agreement (including the initial six Transaction Documents) shall commence on
the Effective Date and continue until December 31, 2014, unless the
Agreement is terminated as provided herein or the Term is extended as provided
in Section 2.2 or 18.14, in which case the term shall end on
the effective date of such termination or the date to which the Agreement is
extended (collectively, the “Term”).


 


2.2.                              Extension.  Idearc may unilaterally extend the initial
Term on the then-current terms and conditions of the Agreement (subject to any
mutually agreed adjustments to the Charges solely in respect of the extended
Term) for up to two additional one-year periods by providing written notice of
extension to Provider no less than 90 days prior to the expiration of the
initial Term or the first one-year extension period, as applicable.  At least six months prior to the expiration
of the initial Term or the first one-year extension, as applicable, Provider
shall provide Idearc with (i) written notice of the date that the
then-current Term will expire and (ii) Provider’s proposed adjustments to
the Charges in respect of such extended Term.


 


ARTICLE III


TRANSITION


 


3.1.                              Tower Commencement Date.


 


As of each Tower Commencement
Date, Provider shall assume responsibility for, and commence providing, the
Services specified in the applicable Transaction Document.  Except as otherwise expressly provided in the
Agreement, Idearc will retain responsibility for all


 


3

















 


operations that comprise the Services under a Transaction Document
until the applicable Tower Commencement Date.


 


3.2.                              Transition Services.


 


(a)                                  Transition. 
During the Transition Period for each Tower, Provider shall perform the
services, functions and responsibilities and provide the deliverables
identified in this Section 3.2 and in the Transition Plan
(collectively for all Towers, the “Transition Services”).  Provider shall perform the Transition
Services in accordance with the timetable and the Transition Milestones set
forth in the Transition Plan.  Except as
otherwise expressly provided in the Agreement, Idearc will not incur any
charges, fees or expenses payable to Provider in connection with the Transition
Services.  Idearc shall provide
reasonable cooperation to Provider in connection with its performance of the
Transition Services.


 


(b)                                 Transition Plan.  Schedule
3.2 sets forth a draft Transition Plan and the high-level description of
the Transition Milestones, acceptance criteria and Milestone Credits for each
Tower.  During the Pre-Transition Phase,
the Parties shall cooperate in good faith to finalize the Transition Plan to
include additional detail around each milestone.


 


(c)                                  Performance. 
Provider shall perform the Transition Services in a manner that will to
the extent reasonably practicable (i) avoid or minimize any adverse impact
on the business or operations of Idearc, and (ii) avoid degradation to the
Services then being received by Idearc. 
Provider shall perform the Transition Services in conformance with any
applicable specifications set forth in the Transition Plan or otherwise
established by the Parties.  In addition,
Provider shall perform the Transition Services with a level of promptness, due
care, skill and diligence consistent with the practices and professional
standards generally followed by the Peer Group for similarly situated
customers.  Prior to undertaking any
Transition activity, Provider shall discuss with Idearc all known material risks
and shall not proceed with such activity until Idearc is reasonably satisfied
with the plans with regard to such risks. 
Provider shall identify any problems that may impede or delay the timely
completion of each task in the Transition Plan and, unless such problems were
caused by Idearc, resolve the same. 
Idearc shall perform the tasks assigned to it under the Transition Plan.


 


(d)                                 Delays. 
In its sole discretion, Idearc may delay, for a reasonable period,
Provider from proceeding with any part of the Transition or alter the timing
for implementation of portions of the Services. 
Any such delay will not increase the Charges payable by Idearc if the
reason for such delay arises from Idearc’s reasonable concern about Provider’s
ability to perform the Transition Services which are not resolved to Idearc’s
reasonable satisfaction after (i) Idearc has given Provider notice
describing such concerns in reasonable detail, (ii) Idearc provides
Provider with a reasonable opportunity to address such concerns, and (iii) Provider
has not resolved such concerns as promptly as practicable, but in any event no
later than 14 days after receipt of Idearc’s notice.  If Idearc’s decision to


 


4

















 


delay is based upon reasons other than as described above, then (x) any
other Transition Milestone dates directly attributable to such delay may also
be correspondingly delayed, (y) Provider will not be liable for Milestone
Credits directly relating to such delay, and (z) subject to Section 9.10,
Provider may recover any incremental costs incurred by Provider proximately
caused by such Idearc decision to delay.


 


(e)                                  Reports. 
Provider shall report to Idearc, as is reasonably necessary, on the
progress in performing Provider’s responsibilities and meeting the timetable
set forth in the Transition Plan. 
Provider also shall provide the Transition-related reports as may be
reasonably requested by Idearc.  In
addition, Provider shall provide such reports as Idearc may reasonably request
regarding the performance of Provider’s responsibilities and the then-current
status with respect to the timetable, in each case as set forth in the
Transition Plan.  Promptly upon receiving
any information indicating that Provider may not perform its responsibilities
or meet the timetable set forth in the Transition Plan, Provider shall notify
Idearc of material delays and shall identify for Idearc’s consideration and
approval specific measures to address such delay and mitigate the risks
associated therewith.


 


(f)                                    Failure to Meet
Critical Transition Milestones.


 


(i)                                     The Parties acknowledge and agree that the Transition Plan
specifies various mutually agreed upon Transition Milestones for the Transition
Services to be provided under each Tower. 
The Transition Milestones identify the dates by which certain Transition
activities and/or deliverables are to be completed.  Provider recognizes that its failure to meet
the Transition Milestones shall have a material adverse impact on the business
and operations of Idearc and that the damages resulting from Provider’s failure
to meet such Transition Milestones (as determined pursuant to a root cause
analysis) are not capable of precise determination.  Accordingly, if Provider fails to meet a
Transition Milestone for which Schedule 3.2 specifies a Milestone
Credit, to the extent such failure is attributable to Provider, then, in
addition to any other remedies available to Idearc under the Agreement, at law
or in equity, and subject to Section 5.2(b), Provider shall be
subject to the imposition of applicable Milestone Credits as damages for the
corresponding failures and not as a penalty.


 


(ii)                                  Neither the Transition nor the activities and deliverables
associated with individual Transition Milestones shall be deemed accepted or
complete until (i) Provider has successfully completed the applicable
Transition Services acceptance criteria in accordance with the process and
standards identified in the Transition Plan for the Transition Services to be
provided under the applicable Tower or (ii) in the absence of such
acceptance criteria, Idearc has notified Provider of Idearc’s acceptance of the
same.


 


5

















 


(g)                                 Adjustment to Charges. 
If, as a result of Provider’s failure to perform in accordance with the
Agreement (subject to Sections 4.9 and 5.7), Provider does not
assume responsibility for all of the Services under a Transaction Document as
of the applicable Tower Commencement Date, the Charges payable to Provider
hereunder shall be equitably reduced in a manner such that Idearc is not
required to pay any amounts for Services that it is not receiving.


 


ARTICLE IV


SERVICES


 


4.1.                              Overview.  Provider shall provide Idearc with the
following services, functions and responsibilities (“Services”), as they
may evolve during the Term or be supplemented, enhanced, modified or replaced
pursuant to the Agreement:


 


(a)                                  the services, functions and
responsibilities set forth in the Statement of Work included within each
Transaction Document (each a “Statement of Work,” and collectively, the “Statements of Work”)
or otherwise in the Agreement;


 


(b)                                 the services, functions and
responsibilities reasonably related to the Services contemplated by each
Statement of Work and routinely performed during the 12 months preceding the
applicable Tower Commencement Date by Idearc Personnel who were displaced or
whose functions were displaced as a result of the Services under the applicable
Transaction Document, even if such services, functions or responsibilities are
not specifically described in such Statement of Work;


 


(c)                                  any related services, functions or
responsibilities not specifically described in the Agreement as forming part of
the Services that are an inherent, necessary or customary part of the Services
or are required or reasonably necessary for the proper performance or provision
of the Services in accordance with the Agreement; provided, however, none of the Idearc Retained Functions (or
services, functions or responsibilities related thereto) shall be deemed to be
part of the services, functions and responsibilities of Provider under this
paragraph (c);


 


(d)                                 Transition Services;


 


(e)                                  Termination Assistance Services; and


 


(f)                                    any New Services with respect to which
the Parties have executed and delivered a written agreement constituting an
amendment to the Agreement pursuant to Section 4.8.


 


Provider shall
provide all services, functions and responsibilities described in paragraphs (a) through
(f) above to the same extent and in the same manner as if specifically
described in the Agreement.


 


4.2.                              Services
to the Idearc Group.  From time
to time, Idearc may request that Provider provide Services to, or on behalf of,
any member of the Idearc Group not otherwise


 


6

















 


contemplated as of the
Effective Date or requested pursuant to Section 4.4 below.  Subject to Section 9.10, such
Services shall be performed under the Agreement in accordance with the terms,
conditions and prices then applicable to the provisions of the same Services to
Idearc.


 


4.3.                              Natural
Growth and Contraction.  Provider acknowledges that Idearc may, through
natural business growth and contraction, expand its operations within existing
markets or into new markets (including geographic markets and industry vertical
markets) or contract its operations or withdraw from existing markets.  Provider shall provide as part of the
Services the assessments, integration or transition planning and migration
support to, or on behalf of, Idearc and members of the Idearc Group in
connection with such growth and contraction events.  Such events will not be considered to be
Transactions.


 


4.4.                              Certain Idearc Transactions.


 


(a)                                  Support. 
Provider acknowledges that Idearc may need support and assistance from
Provider in connection with business reorganizations, acquisitions,
divestitures, spin-offs, significant equity investments, formation of
partnerships or similar entities, or similar business transactions or
combinations (collectively “Transactions”). 
Further, Idearc requires the ability to move Services in and out of
scope (and potentially between different corporate entities) in connection with
Transactions.  In order to provide Idearc
with this flexibility, Provider agrees that, as part of the Charges, Provider
shall provide the Services, including as described in Section 4.3
above, assessments, integration or transition planning and migration support
to, or on behalf of, Idearc and members of the Idearc Group in connection with
Transactions and to, or on behalf of, any successor that assumes responsibility
for the operation or management of any aspect of their respective
businesses.  If Idearc changes all or
part of its business structure in connection with a Transaction and as a result
there is a new Entity that becomes a member of the Idearc Group (“New Entity”), then,
at Idearc’s request and in accordance with its directions, Provider also shall
provide the Services to, or on behalf of, the New Entity; provided, however, that if Provider is not
able to provide such support using resources otherwise assigned to the
provision of Services hereunder (after working with Idearc to adjust Service
priorities and resource allocations and, if consented in writing by Idearc,
temporarily suspending certain Service Levels), then the cost of any additional
resources needed to provide such support shall be subject to the operation of Section 9.10.


 


(b)                                 Assistance. 
Provider shall provide to Idearc, at no additional cost, such assistance
and information as may be reasonably requested by Idearc if Idearc indicates
that it is considering a Transaction. 
Such assistance will include (i) responding promptly to requests
for information relating to the Services and charges for the Services; (ii) if
requested by Idearc, assisting in discussions with third parties relating to
any equipment, licenses or contracts relating to the businesses or assets
affected by the contemplated Transaction; (iii) cooperating in good faith
with Idearc with respect to the Transaction; and (iv) such other assistance
(including the provision of Termination Assistance Services to the extent
necessary under


 


7

















 


the circumstances) as may be reasonably necessary at the time.  Further, Provider acknowledges and agrees
that Idearc may disclose Provider Confidential Information to prospective
counterparties in a Transaction, subject to meeting the requirements set forth
in Section 12.3(b)(i)(A) through (C).


 


(c)                                  Divestiture. 
Upon Idearc’s request, Provider shall provide the Services (including
divestiture transition support services) to a former member of the Idearc Group
in accordance with the Agreement for up to 12 months following the divestiture,
provided that Idearc will remain financially obligated therefor.  Without diminishing Provider’s obligation
under the preceding sentence, Provider may also provide the Services to the
divested Entity pursuant to a separate agreement entered into by Provider and
such divested Entity.  If Idearc requests
Provider to continue providing the Services to such divested Entity pursuant to
the foregoing, Provider shall, at Idearc’s request, enter into good faith
negotiations with such Entity with respect to such a separate agreement.  If the Services are provided pursuant to a
separate agreement, (x) Idearc will have no obligation to pay any fees in
relation to those Services provided to such divested Entity, and (y) Idearc
will receive the benefit of providing Provider with the opportunity of
providing services to such divested Entity by, among other things, (i) providing
that, for purposes of calculating any unit price volume discounts (or similar
benefits) under the Agreement, the Services provided to such divested Entity
will be deemed included in any calculation of Service volumes under the
Agreement, and (ii) any termination fees payable as a result of
termination of the Agreement shall be equitably reduced to reflect the volume
of Services then being provided under such separate agreement.  Section 9.10 shall govern any
adjustment to the Services required in respect of a divestiture where the
divested Entity does not receive Services pursuant to a separate agreement.


 


4.5.                              Service
Volumes;Insourcing/Resourcing; Special Incentive Pricing
.


 


(a)                                  Right to Change Service
Volumes.  During the Term, Idearc may from time to time
increase or decrease the Service volumes, including as a result of fluctuations
in Idearc’s business or by adding or removing members of the Idearc Group.  Any such change in volumes, and any resulting
adjustment to the Charges, will be governed by Schedule 10.1.


 


(b)                                 Insourcing; Resourcing. 
Provider acknowledges that its relationship with Idearc is not exclusive
and that nothing in the Agreement shall be construed as a requirements
contract.  Notwithstanding anything to the
contrary contained herein, the Agreement shall not be interpreted to prevent
Idearc from obtaining from third parties or providing to itself any or all of
the Services described in the Agreement or any other services.  Idearc may obtain services similar to the
Services from one or more third parties or perform such services
internally.  Such resourcing of Services
by Idearc to third parties or insourcing of Services by Idearc to itself will
neither constitute a termination under Article XVIII nor result in
any Termination Fee becoming payable by Idearc; provided,
however, that, if any insourcing or resourcing results in the
reduction in the volume of Services by


 


8

















 


more than 40% on a cumulative basis measured from the in-scope volume
of the applicable Services as of the Effective Date, then the Parties shall
cooperate in good faith to renegotiate pricing or any other terms affected by
such insourcing or resourcing including the amount payable to Provider as
partial termination fee under Section 18.3.  If the Parties are unable to reach agreement
within 90 days of the delivery of notice of such insourcing or resourcing, such
insourcing or resourcing shall be deemed to be a partial termination for
convenience pursuant to Section 18.3.  Upon Idearc’s exercise of any of its rights
under this Section 4.5, the Charges will be adjusted in accordance
with Schedule 10.1.


 


(c)                                  Special Incentive Pricing.  [Redacted]


 


[**CONFIDENTIAL TREATMENT
REQUESTED PURSUANT TO 17 C.F.R. §240.24b-2 AND 17 C.F.R. §200.80**]


 


4.6.                              New Services.


 


(a)                                  Idearc may request Provider to provide
services (i) that are materially different from and in addition to the
Services, (ii) for which there is no charging methodology under the
Agreement, and (iii) that cannot be performed using then assigned
resources without adversely impacting the performance of the Services  that is applicable to the effort to be
provided (“New Services”).  For
the avoidance of doubt, New Services do not include (A) increases in the
volume of Services to be provided by Provider, or (B) changes to the
Services as a result of the evolution of the Services due to continuous
improvement required pursuant to the Agreement.


 


(b)                                 Procedures.


 


(i)                                     If Idearc requests that Provider perform any New Services,
Provider shall promptly prepare a New Services proposal for Idearc’s
consideration.  Unless otherwise agreed
by the Parties, Provider shall prepare such New Services proposal at no
additional charge to Idearc and shall deliver such proposal to Idearc as soon
as practicable, but no later than 30 days after its receipt of Idearc’s
request; provided, however, that Provider shall use
Commercially Reasonable Efforts to respond within Idearc’s requested time-frame
in the case of a pressing business need or an emergency situation.  Idearc shall provide such information and
cooperation as Provider may reasonably request to prepare such New Service
proposal.


 


(ii)                                  Each New Services proposal will include, among other things, (A) a
reasonably detailed project plan and fixed price or price estimate for the New
Service; (B) a detailed breakdown of such price or estimate; (C) a
detailed description of the service levels to be associated with such New
Service; (D) a schedule for commencing and completing the New Service; (E) a
description of any new hardware or software to be provided by


 


9

















 


Provider in
connection with the New Service; (F) an estimate of the software, hardware
and other resources necessary to provide the New Service; and (G) any
additional facilities or labor resources to be provided by Idearc in connection
with the proposed New Service; and (H) a services description.


 


(iii)                               Idearc may accept or reject any New Services proposal, or condition
approval of any New Services proposal upon the provision of additional
information by Provider, in each case in its sole discretion.  Any agreement of the Parties with respect to
New Services shall be expressed in writing and signed by both Parties pursuant
to Section 21.4.  Upon the
Parties’ execution and delivery of a document regarding such New Services, the
scope of the Services will be deemed to have been expanded, and the Agreement
will be deemed amended to include the Parties’ agreement with respect to such
New Services.  If applicable, such
written document may constitute a new or amended Transaction Document.


 


(iv)                              Provider shall act reasonably and in good faith in
formulating any pricing proposal for New Services and Provider shall use Commercially
Reasonable Efforts to identify potential means of reducing the cost to Idearc,
including utilizing subcontractors as and to the extent appropriate.


 


(v)                                 Provider shall not unreasonably refuse to provide New
Services to Idearc and members of the Idearc Group if such requested services
are within the general scope of Provider’s service and product offerings.  Notwithstanding the existence of any dispute
between the Parties as to whether a requested service constitutes a New Service
or as to the charges at which any New Service will be provided to Idearc,
Provider shall begin providing the requested service at the rates specified in Schedule
10.1 for the corresponding skillset if Idearc notifies Provider that such
service needs to be provided due to a pressing business need or emergency
situation; provided, however,
that if a good faith dispute exists between the Parties regarding the charges
at which a New Service is to be provided to Idearc, (i) Provider shall not
be required to expend capital to acquire assets or to incur other material
out-of-pocket costs (except, if agreed by Idearc, on a pass-through basis)
until the Parties agree upon the charges at which such requested service will
be provided and (ii) the Parties shall endeavor to resolve such dispute on
an expedited basis pursuant to Article XIX.  In accordance with Section 10.2,
Provider shall adjust (either upwards or downwards) the invoices sent to Idearc
to reflect the agreed-upon charges for such service from the date Provider
began providing such service.


 


(c)                                  Use of Third Parties. Idearc may elect to solicit and receive
bids from third parties to perform any New Services.  If Idearc elects to use third parties to
perform New Services, Provider shall reasonably cooperate with such third parties
as provided in Section 9.13.


 


10
















 


(d)                                 Approval. 
Provider shall promptly inform the Idearc Program Manager of requests
for New Services and shall submit any proposals for New Services to the Idearc
Program Manager or his or her designee. 
Provider shall not agree to provide New Services without the prior
approval of the Idearc Program Manager or his or her designee.  Idearc will not be obligated to compensate
Provider for any New Services rendered absent such prior approval.


 


4.7.                              Technology and Business Process
Evolution.


 


In providing the
Services, Provider shall employ technologies and business process strategies
that are flexible enough to allow integration with new technologies or business
processes, or significant changes in Idearc’s business objectives and
strategies.  Without limiting the
generality of the foregoing, Provider shall ensure that Equipment will have
sufficient scalability and be sufficiently modular to allow integration of new
technologies without the need to replace whole, or significant parts of,
systems or business processes so that Idearc’s business will become
increasingly scalable and flexible throughout the Term.


 


4.8.                              Disaster Recovery and Business
Continuity.


 


(a)                                  Responsibility. 
Provider will be responsible for disaster recovery and business
continuity planning, testing, implementation and execution related to Provider
Service Locations (and locations of its subcontractors).  Provider shall provide the Services described
in subparagraphs (i) and (iv) below as part of the Charges.  For all Services described in this paragraph
(a), Provider shall continue to provide at least the same level of disaster
recovery and business continuity capability as it relates to the Services in
place as of the Effective Date, including:


 


(i)                                     maintaining the Disaster Recovery and Business Continuity
Plan (as defined in paragraph (b) below);


 


(ii)                                  implementing Provider’s disaster recovery plans in the event
of a Disaster affecting Provider Service Locations within the specified
timeframes;


 


(iii)                               carrying out disaster recovery, business continuity or
redundancy procedures related to the Services in accordance with such Disaster
Recovery and Business Continuity Plan; and


 


(iv)                              designing and implementing a business continuity plan
specific to Provider’s processes and Service Locations to minimize disruption
to Idearc’s business processes in the event of any disruption to the Services.


 


(b)                                 Disaster Recovery and
Business Continuity Plan.  In accordance with the
Transition Plan, Provider shall prepare and submit for Idearc approval a draft disaster
recovery and business continuity plan covering the Services under each
Transaction Document (the “Disaster Recovery and
Business Continuity Plan”). 
Schedule 4.8 sets forth the general principles and specific
information to be


 


11

















 


included in the Disaster Recovery and Business Continuity Plan.  Provider shall include modifications and
amendments requested by Idearc, and Provider shall implement such plan
following final approval by Idearc. 
Additionally, at least annually during the Term and as part of the
Charges, Provider shall review and develop updates and modifications which will
be submitted to Idearc for approval.  If
Idearc approves such updates and modifications, Provider shall, as part of the
Charges, implement the new updated plan(s).


 


(c)                                  Priority. If a Disaster or major site impact
occurs involving the need to recover operations at the affected site or to
operate from a fallback site and, as a result, it is necessary for Provider or
its Affiliates or subcontractors providing the Services (collectively, the “Provider Group”) to
allocate limited resources between or among several organizations, Provider
shall not (and shall use Commercially Reasonable Efforts to cause other members
of Provider Group to not) treat Idearc, in any respect, less favorably than any
similarly situated Provider customer.


 


4.9.                              Savings Clause.


 


(a)                                  Due to the impact that any termination or
suspension of Services would have on the business and operations of Idearc and
members of the Idearc Group, Provider acknowledges that Idearc has informed it
that Idearc would not have been willing to enter into the Agreement without
assurance that (i) the Agreement may not be terminated by Provider (other
than as contemplated in Section 18.2) and (ii) Provider would
not suspend Services.  Consequently,
Idearc’s failure to perform any of its obligations set forth in the Agreement
shall not be deemed to be grounds for termination of the Agreement by Provider
(other than as contemplated in Section 18.2) or for suspension of
Services by Provider.


 


(b)                                 Provider’s failure to perform, or delay
in performing, its responsibilities under the Agreement or to meet the Service
Levels shall be excused if, and to the extent that, Provider demonstrates that
its non-performance is proximately caused by the failure of Idearc (or any
Idearc Third-Party Contractor) to perform Idearc’s expressly specified
obligations under the Agreement; provided
that (i) Provider provides
Idearc reasonably prompt written notice of such failure to perform and Provider’s
inability to perform under such circumstances, (ii) Provider provides
Idearc with a reasonable opportunity to correct such failure to perform if
practicable under the circumstances and thereby avoid such Provider
non-performance, (iii) Provider identifies and exercises Commercially
Reasonable Efforts to avoid or mitigate the impact of such failure to perform
and (iv) Provider uses Commercially Reasonable Efforts to perform
notwithstanding such failure to perform.


 


(c)                                  Provider shall be responsible for the
provision of the Services in accordance with the Agreement even if, by
agreement of the Parties, such Services are performed or dependent upon
services performed by Provider Personnel or Idearc Third-Party Contractors for
which Provider has operational responsibility.


 


12

















 


4.10.                        Processing Norms.


 


Idearc and
Provider acknowledge and agree that, as part of the Services, Provider will be
responsible for processing certain orders into Idearc’s Account Management
systems.  The AM Transaction Document and
the Policies and Procedures Manual will establish the norms and procedures for
Provider’s entry of such orders (“Processing Norms”).  Provider shall be entitled to rely on and act
in accordance with such Processing Norms as the same may be updated from time
to time upon notice to Provider.


 


4.11.                        Processing Transactions.


 


The applicable
Transaction Document or any attachments thereto mutually agreed and signed by the
Parties shall describe the delivery method for transmission of processed
transactions and/or reporting by Provider if applicable to the Services being
provided under such Transaction Document. 
Provider agrees to conform the Services and deliveries in accordance
with such established procedure set forth in the applicable Transaction
Document and/or applicable attachments thereto.


 


ARTICLE V

SERVICE LEVELS


 


5.1.                              General.  Provider shall perform the Services at such
levels of accuracy, quality, timeliness, responsiveness and productivity and
otherwise in such a manner as to meet or exceed the higher of (i) practices
and professional standards generally followed by the Peer Group; and (ii) the
documented or otherwise verifiable levels achieved by or on behalf of Idearc
for services similar to the Services.  In
addition, Provider shall perform the Services so as to meet or exceed the KPI’s
and GPI’s set forth in each Transaction Document (collectively, the “Service Levels”); provided, however, that to the extent the
Parties have established a KPI or GPI for a specific Service, the obligations
described in the first sentence of this Section 5.1 shall not be
construed to alter, expand, diminish or supersede such KPI or GPI.


 


5.2.                              Performance Credits.


 


(a)                                  Performance Credits. 
Provider recognizes that Idearc is paying Provider to deliver certain
Services at specified Service Levels. 
Subject to Sections 4.9(b) and 5.7, if Provider fails to
meet a KPI, then Provider shall pay or credit to Idearc the Performance Credit
calculated in accordance with Schedule 5.1 in recognition of the
diminished value of the Services resulting from Provider’s failure to meet the
agreed-upon level of performance and not as a penalty.


 


(b)                                 Not Sole and Exclusive
Remedy.  The Performance Credits, are not intended as
an exclusive remedy for damages sustained or incurred as a result of the
occurrence of a Service Level Default, and Idearc may pursue other remedies
against Provider for such damages as may be available at law (including pursuant
to the Agreement) or in equity; provided,
however, that, any damage award obtained by Idearc against Provider
shall be reduced by any Performance Credit received by


 


13

















 


Idearc with respect to the incident from which such damage award
resulted, except to the extent such Performance Credit received by Idearc had
already been taken into account in determining the amount of such damage award.


 


5.3.                              Failure
to Perform.  In response
to any Service Level Default, Provider shall (after restoring service or
otherwise resolving any immediate problem) (i) promptly investigate,
perform a root cause analysis and report to Idearc on the causes of the Service
Level Default; (ii) correct the Service Level Default as soon as
practicable (regardless of cause or fault) and begin meeting the Service Level;
(iii) advise Idearc of the status of remedial efforts being undertaken
with respect to such Service Level Default; (iv) use Commercially
Reasonable Efforts to prevent any recurrence of such Service Level Default; and
(v) participate in and contribute to Idearc’s situation management
process.


 


5.4.                              Performance
Review.  Annually, or more frequently
if requested by Idearc, the Parties shall jointly review (i) the
then-current Service Levels, (ii) the percentage difference between
Provider’s actual performance and the then-current Service Levels and (iii) generally
available information indicating industry-wide improvements of and trends in
the delivery of substantially similar services. 
The Parties shall, to the extent reasonable, (1) increase the
Service Levels to reflect improved performance capabilities associated with
advances in the proven processes, technologies and methods available to perform
the Services; (2) add new Service Levels to permit further measurement or
monitoring of the accuracy, quality, timeliness, responsiveness,
cost-effectiveness, or productivity of the Services; (3) modify or
increase the Service Levels to reflect changes in the processes, architecture,
standards, strategies, needs or objectives defined by Idearc; and (4) modify
or increase the Service Levels to reflect agreed-upon changes in the manner in
which the Services are performed by Provider.


 


5.5.                              Measurement
and Monitoring.  Provider
shall implement the measurement and monitoring tools and metrics and standard
reporting procedures developed during the Transition Period under each
Transaction Document, all acceptable to Idearc, to measure and report Provider’s
performance of the Services proactively and periodically and at a level of
detail reasonably sufficient to verify Provider’s compliance with the
applicable Service Levels.  Provider
shall provide Idearc with up-to-date problem management data and other data
regarding the status of service problems, service requests and user
inquiries.  Provider also shall provide
Idearc with reasonable access to the data used by Provider to calculate its
performance against the Service Levels and the measurement and monitoring tools
and procedures utilized by Provider to generate such data for purposes of audit
and verification.  Such measurement and
monitoring tools or the resource utilization associated with their use will be
included in the Charges.  If a trend is
detected whereby Provider anticipates a decline in any KPI or GPI in the near
future, upon such detection, Provider will propose actions to reverse such
downward trend.  Provider will continue
such actions until the downward trend has been reversed; provided,
however, that, subject to Section 5.7,
Provider will not be excused from the imposition of any Performance Credits as
a result of such declined KPI or GPI.


 


5.6.                              Productivity
Gain-Share.  The Parties
acknowledge and agree that Schedule 10.1 sets forth the Productivity
metrics to be used in connection with the calculation of the Charges


 


14

















 


for each month during the
Term.  At any time during the Term,
either Party may propose certain process improvements or technology investments
that are intended to generate significant improvements in the then-current
Productivity metrics.  Any such proposals
shall be handled in accordance with Section 9.10; provided,
however, that (1) Idearc shall receive the full benefit of any
improvements for which Idearc is financially responsible for implementing (as
measured in both internal costs and third party expenses) and (2) Idearc
shall receive 75% of the benefit of any improvements jointly implemented by the
Parties (no matter the allocation of financial responsibility) and, in each
case, the applicable Productivity metric shall be adjusted to reflect the
benefit accruing to Idearc.  The Parties
shall mutually determine the structure and process under which either Party
will receive such benefits as part of the Change Control Procedure.


 


5.7.                              Exceptions
to Service Level Failures.  In
addition to the relief to which Provider may be entitled under Section 4.9(b),
Provider’s failure to meet any KPI or GPI, will not constitute a Service Level
Default if and to the extent such failure is caused by any of the following:


 


(a)                                  Service or resource reductions or
re-prioritization of tasks requested or approved by Idearc on an emergency
basis in advance of the event requiring such reductions (i.e., not as part of
the ordinary course of business forecasting and resource adjustment processes
in Schedule 10.1) and agreed to by the Parties; provided,
however, that upon receiving any such request, Provider shall
promptly notify Idearc of the expected impact to Service Levels;


 


(b)                                 Solely with respect to the Services
directly affected by a Disaster, implementation by the Parties of the Disaster
Recovery and Business Continuity Plan;


 


(c)                                  Solely with respect to the Services
directly affected thereby and without altering any responsibilities the Parties
under Article XX, the occurrence of any force majeure event;


 


(d)                                 Subject to Provider’s responsibilities
under Section 4.9, failures or delays caused by components (network
hardware, software, network, maintenance) required by Provider to perform the
Services and for which Idearc or Idearc Third Party Contractors are
operationally and administratively responsible; and


 


(e)                                  As mutually agreed by the Parties prior
to conducting any planned activity or outage.


 


ARTICLE VI

RESOURCES


 


6.1.                              Required
Resources. 
Except as otherwise expressly provided in the Agreement, Provider shall
be responsible for providing the facilities, personnel, Equipment, Software,
technical expertise, telecommunications transport and systems, tools and other
resources necessary to provide the Services (as they are defined as of the
Effective Date) at no charge to Idearc. 
All material items of the foregoing are identified in Schedule 6.2.  With


 


15

















 


respect to any additional
facilities, personnel, Equipment, Software, technical expertise,
telecommunications transport and systems, tools and other resources that may
become necessary as a result of any Change or for any New Services, Provider
and Idearc shall identify any such additional items required by Provider in
respect of such change or New Services and shall allocate financial
responsibility therefor.


 


6.2.                              Software, Equipment and Third-Party
Contracts.


 


(a)                                  Financial
Responsibility.  Provider’s Charges shall include all fees and
expenses (including third-party fees and expenses) relating to Services to be
performed on or after the Effective Date with respect to (1) the Software
and Equipment for which Provider is financially responsible under each Tower as
set forth on the financial responsibility matrix in Schedule 6.2 (the “Financial Responsibility Matrix”)
(including Upgrades, enhancements, new versions or new releases of such
Software and Equipment) and (2) the Third-Party Contracts, Equipment
Leases and Third-Party Software licenses for which Provider is financially
responsible under each Tower as set forth on the Financial Responsibility
Matrix (including new, substitute or replacement items thereof).  With respect to Third-Party Software
licenses, Equipment Leases and Third-Party Contracts that are transferred to
Provider or for which Provider otherwise assumes Financial Responsibility under
the Agreement, Provider shall (i) pay all amounts becoming due under such
licenses, leases and contracts, and all related expenses, for periods on or
after the Tower Commencement Date; (ii) rebate to Idearc any prepayment of
such amounts in accordance with Section 10.7; (iii) pay all
modification, termination, cancellation, late payment, renewal or other fees,
penalties, charges, interest or other expenses relating to periods on or after
the Tower Commencement Date; (iv) pay all costs associated with the
transfer of such licenses, leases and contracts to Provider, including all
taxes associated with such transfer; (v) be responsible for curing any
defaults in Provider’s performance under such licenses, leases and contracts;
and (vi) otherwise enforce all of Idearc’s rights under such licenses,
leases and contracts (but in no event shall such enforcement include initiating
litigation or arbitration activities).


 


(b)                                 Rights Upon
Expiration/Termination.  With respect to all Provider
Third-Party Software licenses, Equipment Leases and Third-Party Contracts
entered into during the Term, Provider shall, to the extent permitted under
such license, lease or contract, use Commercially Reasonable Efforts to:


 


(i)                                     obtain for Idearc and its designees the license, sublicense,
assignment and other rights specified in Sections 13.3(b), 13.6
and 18.9;


 


(ii)                                  not subject the granting of such license, sublicense,
assignment and other rights to subsequent third-party approval or the payment
by Idearc or its designees of license, assignment or transfer fees;


 


(iii)                               cause the terms, conditions and prices applicable to Idearc
and its designees following expiration or termination of the Agreement to be no


 


16

















 


less
favorable than those otherwise applicable to Provider, and at least sufficient
for the continuation of the activities comprising the Services; and


 


(iv)                              ensure that neither the expiration or termination of the
Agreement nor the assignment of the license, lease or contract will trigger
less favorable terms, conditions or pricing.


 


If Provider is unable to obtain any
such rights and assurances, Provider shall notify Idearc in advance and shall
not use such Third-Party Software license, Equipment Lease or Third-Party
Contract provided by Provider without Idearc’s prior written consent (and
absent such consent, Provider’s use of any such Provider Third-Party Software
license, Equipment Lease or Third-Party Contract shall obligate Provider to
obtain or arrange, at no additional cost to Idearc, for such license,
sublicense, assignment or other right for Idearc and its designees upon
expiration or termination of the Agreement). 
If Idearc consents to Provider’s use of specific Provider Third-Party
Software licenses, Equipment Leases or Third-Party Contracts under such
circumstances, such consent shall be deemed to be conditioned on Provider’s
commitment to use Commercially Reasonable Efforts to cause such third party to
agree at expiration or termination of the Agreement or the completion of
Termination Assistance Services to permit Idearc and its designees to assume
prospectively the license, lease or contract in question or to enter into a new
license, lease or contract with Idearc and its designees on substantially the
same terms and conditions, including price. 
If Idearc consents to Provider’s use of specific Provider Third-Party
Software licenses, Equipment Leases or Third-Party Contracts under such
circumstances, such Provider Third-Party Software licenses, Equipment Leases or
Third-Party Contracts shall be added as an Exhibit to this Master
Agreement.


 


(c)                                  Modification and
Substitution.  Provider may terminate, shorten or extend the
Third-Party Software licenses, Equipment Leases and Third-Party Contracts for
which Provider is financially responsible under the Financial Responsibility
Matrix and, subject to Section 9.12, may substitute or change
vendors (including using Provider itself to provide such goods or services)
relating to goods or services covered thereby; provided,
however, that, except as otherwise disclosed by Provider and agreed
to by Idearc, such changes (i) shall not constitute a breach of any obligation
of Idearc under such Software licenses, Equipment Leases or Third-Party
Contracts; (ii) shall not result in additional financial obligations,
financial or operational risk to Idearc; (iii) shall not result in any
increase to Idearc in the cost of receiving the Services; and (iv) if
assumable by Idearc, shall not provide for less favorable terms, conditions or
prices for Idearc or its designees following the expiration or termination of
the Agreement or any applicable Service than would otherwise be applicable to
Provider (except for terms, conditions or prices available to Provider because
of its volume purchases).  Provider’s
rights under the immediate preceding sentence are conditioned upon Provider
paying all applicable termination or cancellation charges, and other amounts
due to the applicable vendor associated with such action and


 


17

















 


indemnifying Idearc in accordance with Section 16.1(e).  Notwithstanding anything to the contrary
herein, Provider shall not terminate, shorten or modify without Idearc’s prior
written consent any license for Third-Party Software either created exclusively
for Idearc or otherwise not commercially available.  Provider shall reimburse Idearc for any
termination charges, cancellation charges, or other amounts paid by Idearc in
connection with obtaining any such modification.


 


(d)                                 Recommendation.  At
Provider’s recommendation, Idearc may agree to terminate, shorten or extend one
or more Third-Party Software licenses, leases or contracts for which Idearc has
retained Financial Responsibility and permit Provider to provide (or procure
the provision of) replacements for any such Third-Party Software license, lease
or contracts; provided, however,
that Provider shall be responsible for paying all applicable termination or
cancellation charges, and other amounts due to the applicable vendor associated
with such action.


 


6.3.                              Required
Consents.  Idearc
shall be administratively and financially responsible for obtaining all
Required Consents as provided in this Section 6.3.  Provider shall cooperate with and provide
such assistance as is reasonably requested by Idearc in obtaining the Required
Consents.


 


6.4.                              Refresh.  Except as otherwise agreed
under any Transaction Document or where the Financial Responsibility Matrix
allocates financial responsibility to Idearc, during the Term, Provider shall implement new Provider-owned or
Provider-leased Equipment and new Provider-owned or Provider-licensed Software,
and otherwise maintain the currency and operating condition of the existing
Provider Equipment and Software, in each case as directed by Idearc and at
Provider’s sole cost and expense.


 


ARTICLE VII

SERVICE LOCATIONS


 


7.1.                              Service
Locations.


 


(a)                                  Service Locations.   The Services shall be provided at or from (i) the
Idearc service locations owned or leased by Idearc and identified in each
Transaction Document, as they may be changed by Idearc from time to time (the “Idearc Service Locations”),
(ii) the service locations owned or leased by Provider and identified in
each Transaction Document (the “Provider Service Locations”), or (iii) any other
service location approved by both Provider and Idearc ((i), (ii) and (iii) collectively,
the “Service Locations”).  Provider shall not change any Provider
Service Locations under this Section 7.1(a) without Idearc’s
advance written consent, which Idearc may withhold in its sole discretion.


 


(b)                                 Idearc Service
Locations.  Idearc shall provide Provider with reasonable
access to the Idearc Service Locations solely for Provider’s use in connection
with its provision of Services to Idearc under the Agreement.  Provider’s receipt and use of the Idearc
Service Locations shall be subject to Section 4.9.  Provider shall promptly discontinue its use
of the Idearc Service Locations upon expiration or


 


18

















 


termination of the Agreement and completion of the Termination
Assistance Services.  All Idearc-owned or
Idearc-leased assets provided for the use of Provider under the Agreement shall
remain in Idearc Service Locations unless Idearc otherwise agrees.  In addition, all improvements or
modifications to Idearc Service Locations requested by Provider (i) shall
be subject to review and approval in advance by Idearc, (ii) shall be made
in compliance with Idearc’s then current standards, rules and procedures, (iii) shall
be performed by and through Idearc at Provider’s expense, and (iv) shall
accrue to the property at the termination or expiration of the lease.  Provider acknowledges and agrees that it has
inspected the Idearc Service Locations to the extent it deems necessary and
that such facilities are sufficient for performing the Services and for
satisfying Provider’s responsibilities under the Agreement.  THE IDEARC SERVICE LOCATIONS ARE PROVIDED BY
IDEARC TO PROVIDER ON AN “AS-IS, WHERE-IS” BASIS.  IDEARC EXPRESSLY DISCLAIMS ANY
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, AS TO SUCH IDEARC SERVICE
LOCATIONS, INCLUDING ANY WARRANTIES AS TO THEIR CONDITION OR SUITABILITY FOR
USE BY PROVIDER.  THE PARTIES ACKNOWLEDGE
AND AGREE THAT THE FOREGOING DISCLAIMER SHALL NOT BE CONSTRUED TO LIMIT THE
RELIEF OR OTHERWISE THE INTENT OF SECTION 4.9 OR 5.7(d).


 


(c)                                  Office Furniture,
Fixtures, and Equipment to be Provided by Idearc.  Idearc shall
provide office space and office furniture for Provider Personnel in each Idearc
Service Location as specified in the Financial Responsibility Matrix and each
Transaction Document.  Provider shall be
financially responsible for providing all other office furniture and fixtures
reasonably required by Provider or Provider Personnel at the Idearc Service
Locations to provide the Services, and for all upgrades, replacements and
additions to such furniture or fixtures; provided,
however, that (i) such
furniture and fixtures shall be approved in advance by Idearc and shall comply
with Idearc’s then-current standards (ii) Provider shall use Commercially
Reasonable Efforts to use surplus Idearc furniture and fixtures to the extent
available and (iii) Idearc shall be responsible for installing such
furniture and fixtures.  Provider
Personnel using the office facilities provided by Idearc at the Idearc Service
Locations will be accorded reasonable access to the communications wiring in
such facilities (including fiber, copper and wall jacks) and the use of certain
shared office equipment and services, such as photocopiers, local and long
distance telephone service for calls related to the delivery of Services,
telephone handsets, mail service, office support service (e.g., janitorial), heat, light, and air
conditioning; provided, however, that such access and usage shall
be solely for and in connection with the provision of Services by such Provider
Personnel; provided further that
Provider shall reimburse Idearc for the additional incremental costs, if any,
incurred by Idearc if and to the extent Provider’s technology solution, service
delivery model or inefficiency causes its usage or consumption of such
resources to exceed historical levels.


 


19
















 


(d)                                 Provider’s
Responsibilities Regarding Facilities.  Except as
provided in paragraph (c) above, Provider shall be responsible for
providing all other furniture, fixtures, Equipment, space and facilities
required to perform the Services and all upgrades, improvements, replacements
and additions to such furniture, fixtures, Equipment, space and facilities.


 


(e)                                  Physical Security. 
Provider shall not permit any person to have access to, or control of,
any Idearc Service Location unless such access or control is permitted in
accordance with control procedures approved by Idearc and set forth in the  Policies and Procedures Manual or otherwise
previously communicated (in writing or electronically) to Provider.  Provider shall be solely responsible for
compliance by Provider Personnel with such control procedures, including
obtaining advance approval to the extent required.  Provider also shall be responsible for the
access, control and physical security of the Provider Service Locations, in
each case in accordance with the standards, requirements, and procedures that
are at least equal to the highest of the following: (i) industry standards
for locations similar to the Provider Service Locations, (ii) procedures
applicable to the Idearc Service Locations; and (iii) any higher standard
otherwise agreed by Idearc and Provider.


 


(f)                                    Standards, Requirements
and Procedures at Idearc Service Locations.  Provider shall
adhere to and enforce, and cause Provider Personnel to adhere to and enforce,
Idearc’s routine operational, safety, security or other standards, requirements
and procedures at the Idearc Service Locations all as set forth in the Policies
and Procedures Manual or otherwise previously communicated to Provider.  Such communication and all additions or
modifications to any of such standards, requirements and procedures may be
communicated by Idearc in writing to Provider or Provider Personnel or may be
made available to Provider or Provider Personnel by posting at an Idearc
Service Location, electronic posting or by other means of distribution.  Provider and Provider Personnel shall comply
with all such additions and modifications. 
Provider shall be responsible for the promulgation and distribution of
all such standards, requirements and procedures to Provider Personnel as and to
the extent necessary and appropriate.


 


(g)                                 Employee Services. 
Subject to applicable security requirements, Idearc shall permit
Provider Personnel to use certain employee facilities (e.g., parking facilities, cafeteria, and
common facilities) at the Idearc Service Locations that are generally made
available to the employees and contractors of Idearc.  The employee facilities in question and the
extent of Provider Personnel’s permitted use shall be specified in writing by
Idearc and shall be subject to modification without advance notice in Idearc’s
sole discretion.


 


(h)                                 Use of Idearc Service
Locations.  Without obtaining Idearc’s prior written
consent (which may be withheld by Idearc in its sole discretion), Provider
shall not use the Idearc Service Locations or the Equipment and Software
located therein, for any purposes other than to provide the Services to Idearc
and members of the Idearc Group.  Idearc
reserves the right to (i) relocate an Idearc Service Location from


 


20

















 


which Services are then being provided to another geographic location
and (ii) direct Provider to implement a space compression plan or
otherwise cease using all or part of the space in an Idearc Service Location
from which Services are then being provided and to thereafter use such space
for its own purposes; provided, however, that, in the event of such an
Idearc-directed cessation, Idearc shall provide Provider with comparable space
in the new location to the extent necessary for continued provision of the
Services.


 


(i)                                     Conditions for Return. 
When the Idearc Service Locations are no longer to be used by Provider
as contemplated by this Section 7.1 or are otherwise no longer
required for performance of the Services, Provider shall notify Idearc as soon
as practicable and shall vacate and return such Idearc Service Locations
(including any improvements to such facilities made by or at the request of
Provider) to Idearc in substantially the same condition as when such facilities
were first provided to Provider, subject to reasonable wear and tear; provided, however, that Provider shall not
be responsible for the acts of Idearc, members of the Idearc Group, or their
Affiliates or agents (other than Provider and its subcontractors and
Affiliates) causing damage to such facilities.


 


(j)                                     No Violation of Laws. 
Provider shall treat, use and maintain the Idearc Service Locations in a
reasonable manner.  Neither Provider nor
any of its subcontractors shall commit any act in violation of any Laws in such
Provider-occupied Idearc Service Location or any act in violation of Idearc’s
insurance policies or in breach of Idearc’s obligations under the applicable
real estate leases in such Provider-occupied Idearc Service Locations (in each
case, to the extent Provider has received prior notice of such insurance
policies or real estate leases or should reasonably be expected to know of such
obligations or limitations).


 


(k)                                  Control of Service
Locations.  No ownership interest or obligation of any
Idearc Site or related item is conferred upon Provider beyond the limited right
to use the Idearc Service Locations and related items in accordance with the
Agreement.  All such Idearc items will
remain in the care, custody and control of Idearc.  No interest or obligation of any Provider
facility is conferred upon Idearc.  All
such Provider facilities will remain in the care, custody and control of
Provider.  In addition, except for
property to which title is transferred to Provider as evidenced by a bill of
sale, or assignment or comparable written instrument of conveyance or as
otherwise provided herein, no ownership interest or obligation is conferred
upon Provider under the Agreement regarding Idearc’s property beyond the
limited right to use such property for purposes of the Agreement.


 


(l)                                     Certification of
Provider Service Locations.  Provider will
maintain the quality certifications and indicated levels specified in each
Transaction Document for the Term for each Provider Service Location set forth
thereon.


 


21

















 


ARTICLE VIII


HUMAN RESOURCE MATTERS


 


8.1.                             General
Principles Regarding Provider Personnel.  The personnel assigned to the Idearc account
by Provider (or its subcontractors) will be employees of Provider (or such
subcontractors) during the Term. 
Provider (or Provider subcontractors) will be solely responsible for (i) the
proper and lawful payment to Provider Personnel of the compensation and other
benefits of such personnel, including salary and bonus, health and workers’
compensation benefits and all taxes and contributions that Provider (or a
Provider subcontractor), as an employer, is required to pay with respect to the
employment of employees, (ii) the proper maintaining of accurate records
of hours worked and amounts paid or deducted as required by applicable Law, and
(iii) instructing and training the Provider Personnel to accurately and
completely report all hours worked.  No
Provider Personnel will receive, or be entitled to participate in, any of
Idearc’s benefits or benefit plans (or those of Idearc’s Affiliates).  No work or service under the Agreement by
Provider Personnel will be credited as service for any purposes under any of
Idearc’s employee benefit or compensation plans or arrangements (or those of
Idearc’s Affiliates).  All Provider
Personnel shall clearly identify themselves as employees of Provider (or the
applicable subcontractor) and not as employees of Idearc, including in
connection with any and all communications on behalf of Idearc, whether oral,
written or electronic.  Each of such
Provider Personnel shall wear a badge indicating that he or she is employed by
Provider (or its subcontractor).  No
employee, agent, Affiliate, contractor or subcontractor retained by Provider to
perform work on Idearc’s behalf hereunder will be deemed to be an employee,
agent, Affiliate, contractor or subcontractor of Idearc for any purpose.  Provider (or a Provider subcontractor), and
not Idearc, has the right, power, authority and duty to supervise and direct
the activities of Provider Personnel and to compensate such Provider Personnel
for any work performed by them on behalf of Idearc pursuant to the
Agreement.  Provider will be responsible
and therefore solely liable for the acts and omissions of Provider
Personnel.  Provider Personnel will not
be deemed to be third party beneficiaries under the Agreement.  At least quarterly or as otherwise requested
by Idearc, Provider shall provide Idearc with (i) a list of those Provider
Personnel (x) providing Services at Idearc Service Locations and (y) who
are authorized to access, or otherwise have accessed, Idearc Systems or
networks to provide the Services, and (ii) the current security passwords
used by such Provider Personnel to access the Idearc Systems.


 


8.2.                             Replacement, Qualifications, and Retention of Provider
Personnel.


 


(a)                                  Sufficiency and
Suitability of Personnel.  At all times during the Term
and during provision of Termination Assistance Services, (i) Provider
shall assign (or cause to be assigned) sufficient Provider Personnel to provide
the Services in accordance with the Agreement, (ii) such Provider
Personnel shall possess suitable competence, ability and qualifications, (iii) such
Provider Personnel shall be properly educated and trained for the Services they
are to perform, and (iv) such Provider Personnel that are Key Provider
Personnel shall have been approved by Idearc prior to assignment in accordance
with Section 9.5(a).


 


22

















 


(b)                                 Requested
Removal/Replacement.  If Idearc lawfully and in good faith
determines that the continued assignment to Idearc of any Provider Personnel
(including Key Provider Personnel) is not in the best interests of Idearc, then
Idearc shall give Provider notice to that effect requesting that such Provider
Personnel be replaced.  As soon as
practicable, Provider shall replace such Provider Personnel with an individual
of suitable ability and qualifications at no additional cost to Idearc.  In addition, Idearc reserves the right, in
its sole discretion, to disapprove of any Provider Personnel designated to work
at a Idearc Services Location for any reason and to require that any such
person be replaced.  Nothing in this
provision shall operate or be construed to limit Provider’s responsibility for
the acts or omission of Provider Personnel. 
For purposes of this Section 8.2(b), “Provider Personnel”
will not be deemed to include employees of Provider subcontractors, as removal
of subcontractors is provided for in Section 9.12.


 


(c)                                  Turnover Rate and Data. 
Provider shall use Commercially Reasonable Efforts to keep the turnover
rate of Provider Personnel to a level comparable to or better than the industry
average generally experienced by the Peer Group in the provisions of services
similar to the Services.  Upon Idearc’s
request, Provider shall promptly provide data regarding Provider’s turnover
rate for the Provider Personnel primarily performing the Services.  If Idearc, in good faith, expresses concern
that the turnover rate is unacceptable, Provider shall promptly meet with
Idearc to discuss the reasons for the turnover rate.  If Idearc continues to express a good faith
concern regarding turnover rates that are above the industry average generally
experienced by the Peer Group in the provision of services similar to the
Services, Provider promptly shall (i) submit a proposal for reducing the
turnover rate for Idearc’s review and approval, and (ii) implement a
program designed to reduce the turnover rate at no additional cost to
Idearc.  Notwithstanding any transfer or
turnover of Provider Personnel, Provider shall remain obligated to perform the
Services in accordance with the Agreement and the Service Levels.


 


(d)                                 Restriction on
Reassignment.  Neither Provider nor any Provider
subcontractor shall cause or permit any Key Provider Personnel primarily
dedicated to the provision of Services to perform services directly or
indirectly for an Idearc Competitor, either while engaged in the provision of
Services to Idearc or during the one-year period immediately following the
termination of his or her involvement in the provision of the Services, in each
case without Idearc’s prior written consent (which may be withheld by Idearc in
its sole discretion).  Further, Provider
Personnel primarily dedicated to the provision of Services shall not perform
services directly or indirectly for an Idearc Competitor while engaged in the
provision of Services to Idearc.


 


(e)                                  Review of
Qualifications.  From time to time and subject to applicable
Laws, Idearc may request that Provider provide information on the
qualifications of the Provider Personnel. 
If Idearc, in good faith, expresses concern regarding the level of
qualifications possessed by the Provider Personnel (whether on an individual or
aggregate basis), Provider shall promptly meet with Idearc to discuss the
current level and mix of qualifications of the Provider Personnel.  If Idearc continues to


 


23

















 


express a reasonable and good faith concern regarding such level of
qualifications, Provider shall (i) submit a proposal for improving or
increasing, as appropriate, the qualifications possessed by the Provider
Personnel (whether on an individual or aggregate basis, as applicable),
including increased training for existing Provider Personnel and revised hiring
guidelines for future Provider Personnel, and (ii) implement a program
designed to improve or increase, as appropriate, the qualifications of the
Provider Personnel at no additional cost to Idearc.


 


(f)                                    Notice to Idearc. 
With respect to any Provider Personnel that (i) provide Services at
an Idearc Service Location or (ii) access the Idearc Systems, Provider
shall notify Idearc as soon as practicable, but in any event no later than 24
hours following the date that such Provider Personnel is terminated or
otherwise ceases to provide Services.


 


8.3.                             Hiring of Employees.


 


(a)                                  Solicitation and Hiring. 
Except as expressly set forth herein (including the Termination
Assistance Schedule), neither Party shall knowingly solicit, directly or
indirectly, for employment or employ any employee of the other Party who is or
was substantively involved in the performance, provision, receipt or evaluation
of the Services during the period such individual was substantively involved in
the performance, provision, receipt or evaluation of the Services and for a
period of 12 months after the individual was no longer primarily engaged in the
performance, provision, receipt or evaluation of the Services (unless
separation was due to a reduction in force). 
The prohibition on solicitation and hiring shall extend 12 months after
the termination of the employee’s employment or, in the case of Provider, the
cessation of his or her involvement in the performance of Services under the
Agreement, but in no event beyond the expiration of the 12-month period
following conclusion of the Termination Assistance Services.  This provision shall not operate or be
construed to prevent or limit any employee’s right to practice his or her
profession or to utilize his or her skills for another employer or to restrict
any employee’s freedom of movement or association.


 


(b)                                 Publications. 
The (i) publication of classified advertisements in newspapers,
periodicals, Internet bulletin boards, or other publications of general
availability or circulation, (ii) consideration and hiring of persons
responding to such advertisements, or  (iii) use
of independent employment agencies or search firms not specifically targeting
Idearc’s employees shall not be deemed a breach of paragraph (a) above,
unless the advertisement and solicitation is undertaken with the intent to
circumvent or conceal a breach of such paragraph (a).


 


8.4.                             Certain
Employee Restrictions. 
Provider shall not, without Idearc’s prior written approval (such
approval not to be unreasonably withheld or delayed):


 


(a)                                  during the last 12 months of the Term,
allow for the decrease of the total number of employees that Provider and its
Affiliates and subcontractors use to provide the


 


24

















 


Services to such an extent that either the total number of employees or
the total cost per annum of employing such employees (other than as a result of
changes made to compensation and benefits in the ordinary course of business)
would decrease by more than 5%;


 


(b)                                 during the last 12 months of the Term,
allow for the increase of the total number of employees that Provider and its
Affiliates and subcontractors use to provide the Services to such an extent
that the total number of employees would increase by more than 10%; or


 


(c)                                  change the terms and conditions of
employment of any employee who provides Services if such change would take
effect during the last 12 months of the Term or thereafter, including any
change to the term of employment or any change regarding any payment or benefit
triggered by the termination of such employee’s employment (excluding changes
made to compensation and benefits in the ordinary course of business);


 


8.5.                             Other
Personnel Requirements.


 


(a)                                  Provider shall verify that Provider
Personnel (i) are authorized to work in any country in which they are
assigned to provide Services, (ii) have not been convicted of a felony or
a misdemeanor involving a dishonest act, (iii) do not use illegal drugs,
and (iv) are not otherwise disqualified from performing the assigned work
under applicable Laws.  To the extent
allowed by applicable Law, Provider shall screen, interview and conduct
reference and background checks on all Provider Personnel assigned to work
hereunder and, to the extent permitted by law, shall deliver to Idearc all
information obtained from each background check upon request.   Provider shall not assign any Provider
Personnel who fail to meet such criteria to provide any of the Services.  Background checks will include the
verifications identified below.


 


(i)                                    Employment Records Verification:  verification of employment with the
verifiable person’s previous three (3) employers or all of personnel’s
employers over the past five (5) years of employment.  When employment history cannot be verified by
Provider, Idearc reserves the right to disapprove any such verifiable person.


 


(ii)                               Criminal Records Verification:  criminal records check for any history of
felony or misdemeanor convictions for the prior seven (7) years.


 


(iii)                            Drug Screening Verification: 
drug screening test (except in the case of Provider Personnel located in
non-United States locations).


 


(iv)                             Motor Vehicle Records Verification:  state and motor vehicle records checking the
past three (3) years for any verifiable person that will be driving a
vehicle in the performance of Provider obligations under the


 


25

















 


Agreement
and/or any Authorization (except in the case of Provider Personnel located in
non-United States locations).


 


Provider shall deliver to Idearc all
information obtained from each background check upon request.


 


(b)                                 Provider acknowledges that any Provider
Personnel who provides Services or is scheduled to provide Services at an
Idearc Service Location may be subject to an Idearc background check, including
fingerprinting and drug testing, prior to, or in the course of, providing
Services at such Idearc Service Location.


 


(c)                                  Provider agrees to hold all Provider
Personnel subject to Idearc’s Business Standards Code of Ethics (the “Code of Ethics”),
attached hereto as Exhibit A. 
In the event of any violation of the Code of Ethics by Provider
Personnel, Provider shall promptly notify Idearc of (i) the identity of
such Provider Personnel in violation of the Code of Ethics, (ii) the
specific violation committed and (iii) the disciplinary action taken by
Provider in relation to such violation. 
Idearc reserves the right to require any Provider Personnel determined
to be in violation of the Code of Ethics to be removed from performing
Services.


 


ARTICLE IX


RELATIONSHIP MANAGEMENT


 


9.1.                             Provider
Project Executive.  Provider
shall designate a “Provider
Project Executive” for Idearc. 
The Provider Project Executive shall (i) be one of the Key Provider
Personnel; (ii) be a full time employee of Provider; (iii) devote
substantially all of his or her business time and effort to managing the
Services; (iv) remain in this position for a minimum period of two years
from initial assignment; (v) serve as the single point of accountability
for the Services, and (vi) have day-to-day authority for ensuring
reasonable Idearc satisfaction regarding the Services delivery and attainment
of all Service Levels.


 


9.2.                             Idearc
Program Manager.  Idearc
shall designate one individual to whom all Provider communications concerning
the Agreement may be addressed (the “Idearc Program Manager”), who shall have the
authority to act on behalf of Idearc in all day-to-day matters pertaining to the
Agreement.  Idearc may change any
designated Idearc Program Manager from time to time by providing notice to
Provider.  Additionally, Idearc may
designate additional representatives who will be authorized to make certain
decisions (e.g., regarding emergency
maintenance) if the Idearc Program Manager is not available.


 


9.3.                             Governance.  Provider
and Idearc will establish the governance structure set forth in Schedule 9.3
for both Tower- and Agreement-level governance as part of the Transition
Services.


 


9.4.                             Annual
Reviews.  Annually, or more frequently
if requested by Idearc, the Parties shall conduct a review of the Services then
being performed by Provider and Provider’s performance against the Service
Levels and the Agreement in general.  As
part of such review, the Parties shall (i) review the baseline against
actual service volumes for the


 


26

















 


previous year, (ii) forecast
the service volumes for the next year and (iii) examine (A) whether
the fees are consistent with Idearc’s forecasts and Provider’s representations,
(B) the quality of the performance and delivery of the Services, (C) whether
Provider has delivered cost savings or efficiencies, (D) business process
strategy and direction, and (E) such other things as Idearc may reasonably
require.  The Parties also shall assess
whether Provider is meeting the objectives of the relationship.  Provider shall provide Idearc any reasonably
requested assistance to verify the information provided in such reviews.  If the review identifies any material issues
with Provider’s performance against its corresponding obligations (including
failing to meet the objectives of the relationship), Provider shall prepare a
remediation plan with objectively measurable actions within 30 days after the
date of the review and, when approved, implement that plan to improve Provider’s
performance.  Idearc may allocate
Performance Credits (in accordance with Schedule 5.1) to the implementation of
objectively measurable components of any such plan.


 


9.5.                             Key Provider Personnel.


 


(a)                                  Approval of Key Provider Personnel.


 


(i)                                    The initial key Provider account management and operational
positions to be held by Key Provider Personnel are listed in each Transaction
Document.  At least 40 days prior to
assigning an individual to act as one of the Key Provider Personnel, whether as
an initial assignment or a subsequent assignment, Provider shall (i) notify
Idearc of the proposed assignment, (ii) introduce the individual to
appropriate Idearc representatives, (iii) provide reasonable opportunity
for Idearc representatives to interview the individual and (iv) consistent
with applicable law, provide Idearc with a resume and such other information
about the individual as may be reasonably requested by Idearc.  If Idearc lawfully and in good faith objects
to the proposed assignment, Provider shall not assign the individual to that
position and shall propose to Idearc the assignment of another individual of
suitable ability and qualifications.


 


(ii)                                 Idearc may from time to time change the individuals or
positions designated as Key Provider Personnel under the Agreement with
Provider’s consent, which shall not be unreasonably withheld.


 


(iii)                             Provider shall allow Idearc the opportunity to conduct an
annual review of the Provider Project Executive and each of the other Key
Provider Personnel under such Transaction Document and an opportunity to
provide meaningful information to Provider with respect to Idearc’s evaluation
of the performance of the Provider Project Executive and the other Key Provider
Personnel.  Provider (or the applicable
subcontractor) shall appropriately take such evaluation into account in
establishing bonus and other compensation for such individuals.


 


27

















 


(b)                                 Key Provider
Personnel/Minimum Retention Period.  Provider
shall cause each of the initially designated Key Provider Personnel to devote
substantially all of his or her business time and effort to the provision of
the Services under the Agreement for a minimum period of 12 months from the
date of initial assignment.  During such
12 month period, Provider shall not transfer, reassign or remove any of the Key
Provider Personnel (except as a result of voluntary resignation, involuntary termination
for Cause, illness, disability, or death), remove or eliminate any position
held by Key Provider Personnel, or announce its intention to do any of the
foregoing during such 12 month period without Idearc’s prior written
consent.  Provider shall maintain active
succession plans for each of the Key Provider Personnel.


 


(c)                                  Replacement of Key
Provider Personnel.  After the 12-month period specified in
paragraph (b) above, Provider shall not transfer, reassign or remove its
Key Provider Personnel (except as a result of voluntary resignation,
involuntary termination for Cause, illness, disability or death) unless
Provider (i) gives Idearc at least 60 days prior written notice of such
action, and (ii) identifies and obtains Idearc’s approval of a suitable
replacement.  If Idearc raises a good
faith concern that such action may have an adverse impact on Provider’s
performance of its obligations under the Agreement, Provider shall meet with
Idearc and, if necessary, take such commercially reasonable actions to address
such concern to Idearc’s reasonable satisfaction.  Provider shall not (except as a result of
voluntary resignation, involuntary termination for Cause, illness, disability
or death) transfer, reassign or remove more than the greater of one or 10% of
the Key Provider Personnel in any six-month period unless otherwise agreed by
the Parties.  In the event of the
voluntary resignation, involuntary termination for Cause, illness, disability
or death of any Key Provider Personnel during or after the specified 12-month
period, Provider shall (1) give Idearc as much notice as reasonably
practicable of such development, and (2) identify and obtain Idearc’s
approval of a suitable replacement as soon as is reasonably practicable in
accordance with Section 9.5(a).


 


9.6.                             Policies and Procedures Manual.


 


(a)                                  Delivery and Contents. 
An outline setting forth preliminary policies and procedures (including
security and control requirements) to be followed by Provider in its
performance of the Services under each Transaction Document, as such policies
and procedures may be updated from time to time during the Term, is set forth
in Schedule 9.6.  The policies and
procedures outline will be finalized in accordance with the Transition Plan and
will become the final documentation for policies and procedures under each
Transaction Document (the “Policies and Procedures
Manual”).  The outline
shall include, at a minimum, the procedures under each Transaction Document for
Idearc/Provider interaction and communication, including (A) work
flow/demand management; (B) service level monitoring; (C) procedures
for and limits on direct communication by Provider with Idearc personnel; (D) problem
management and escalation procedures; (E) Quality Assurance procedures,
internal controls and checkpoint reviews; and (F)


 


28

















 


practices and procedures addressing such other issues and matters as
Idearc shall reasonably require.


 


(b)                                 Revision and
Maintenance.  The Policies and Procedures Manual shall be
delivered and maintained by Provider and Idearc in an electronic format and
shall be accessible electronically to both Parties in a manner consistent with
Idearc’s security policies.  Provider and
Idearc shall periodically modify and update the Policies and Procedures Manual
to (i) reflect changes in the operations or procedures described therein,
and (ii) to respond to comments provided by the Idearc Program Manager
from time to time during the Term.


 


(c)                                  Compliance. 
Provider shall perform the Services under each Transaction Document in
accordance with Idearc’s then-current policies and procedures provided or
otherwise made available to Provider until the Policies and Procedures Manual
is finalized and agreed upon by the Parties. 
Thereafter, Provider shall perform the Services under each Transaction
Document in accordance with the Policies and Procedures Manual.  In the event of a conflict between the
provisions of a Transaction Document and the Policies and Procedures Manual,
the provisions of the Transaction Document shall govern and control.  In the event of a conflict between the
Policies and Procedures Manual and Idearc’s then-current policies and
procedures, Idearc’s then-current policies and procedures shall prevail so long
as Provider has actual knowledge of such Idearc policies and procedures.


 


9.7.                             Service
Level Reports.  Provider
shall provide Idearc with reports agreed upon by both parties and access to
associated supporting data, relating to the performance of the Services
reasonably sufficient to permit Idearc to monitor and manage Provider’s
performance (“Reports”).  In addition, from time to time, Idearc may
make reasonable requests for additional Reports to be generated by Provider and
delivered to Idearc on an ad hoc or
periodic basis.  All Reports shall be
provided to Idearc as part of the Services.


 


9.8.                             Quality
Assurance and Provider Internal Controls.  Provider shall develop and implement Quality
Assurance procedures, including implementing tools and/or methodologies, for
monitoring whether the Services are performed in an accurate and timely manner,
in accordance with the Service Levels. 
Such procedures and controls will include verification, checkpoint
reviews, testing, acceptance, and other procedures for Idearc to assure the accuracy,
quality and timeliness of Provider’s performance.


 


9.9.                             Change Management.


 


(a)                                  Idearc Approval. 
Without Idearc’s prior approval, Provider shall make no change that will
or will be reasonably likely to:


 


(i)                                     increase Idearc’s total costs of receiving the Services
(including Idearc’s retained costs);


 


29
















 


(ii)                                 require changes to, or have an adverse impact on, Idearc’s
business, facilities, operations, business processes, systems, software,
utilities, tools or equipment (including those provided, managed, operated,
supported and/or used on Idearc’s behalf by Idearc Third-Party Contractors);


 


(iii)                              have an adverse impact on the functionality, performance,
accuracy, speed, quality or resource efficiency of the Services;


 


(iv)                             have an adverse impact on the cost, either actual or planned,
to Idearc of terminating all or any part of the Services or exercising its
right to in-source or use third parties;


 


(v)                                violate or be inconsistent with the Transition Plan or Idearc’s
policies or standards set forth in the Policies and Procedures Manual or
otherwise previously communicated (in writing or electronically) to Provider.


 


(b)                                 Implementation. 
Provider shall schedule and implement all changes in such a manner to
minimize (i) any disruption or adverse impact to Idearc’s business or
operations or (ii) any degradation to the Services then being
received.  In addition, Idearc may direct
Provider to prioritize any changes, with such priorities to be reflected in
Provider’s scheduling, Idearc will cooperate with Provider in scheduling such
changes.


 


(c)                                  Notification. 
In connection with its change management activities, Provider shall
promptly notify Idearc of (i) any complaints made to Provider or any
Provider Personnel and shall identify the party making such complaint and the
party against which such complaint was made and shall specify in reasonable
detail the nature of and circumstances giving rise to such complaint and (ii) the
occurrence of any event or the existence of any circumstance that would be
reasonably likely to result in Provider’s inability to achieve any Service
Level or otherwise satisfy its obligations hereunder.


 


9.10.                       Change Control Procedure.


 


(a)                                 Either Party may request in writing that
Provider make changes, modifications or enhancements (each a “Service Change”) to
the Services or to the Agreement (including corresponding changes to the
Service descriptions, Charges and Service Levels), provided that such Service
Change is within the scope of the Services and does not constitute a New
Service.  Service Changes shall be
requested by written notice delivered to the Idearc Program Manager or the
Provider Project Executive, as applicable, in any case specifying in detail the
proposed Service Change (a “Change Control Request”).  Any requested change that constitutes a New
Service shall be subject to the operation of Section 4.6.


 


(b)                                Idearc and Provider shall cooperate with
each other in good faith in discussing the scope and nature of each Change
Control Request, the availability of Provider Personnel and resources to
accommodate such Service Change and the timetable


 


30

















 


for implementation of such Service Change.  In addition, Idearc and Provider will
cooperate to manage the volume of Change Control Requests and the level of
effort required to perform Change Analyses.


 


(c)                                 As soon as reasonably practicable
following receipt of a Change Control Request from Idearc or simultaneously
with Provider’s delivery of a Change Control Request, Provider will prepare and
deliver to the Idearc Program Manager a written analysis (a “Change Analysis”)
describing any changes in products, services, assignment of personnel and other
resources that Provider believes would be required.  In addition, such Change Analysis shall
include, as appropriate or applicable, (i) an estimation of the net
increase or net decrease, if any, in the Charges that would be required to the
extent such Change Control Request requires materially different levels or
types of effort, resources or expense from Provider, (ii) an estimate of
the net effect (positive or negative) on the Productivity metrics set forth on Schedule
10.1, (iii) a description of how the Change Control Request would be
implemented, (iv) a description of the effect, if any, such Change Control
Request would be estimated to have on the Agreement, including on Service
Levels and Termination Fees, (v) an estimation of all resources required
to implement such Change Control Request, including a description of the
delivery risks and associated risk mitigation plans, and (vi) such other information
as may be relevant to the Change Control Request.  Each Change Control Request will be
evaluated, and each Change Analysis will be prepared, taking into account any
effort, resources or expense formerly required to provide Services that have been
reduced or eliminated prior to or in connection with such Service Change, which
have not otherwise been utilized by Provider to provide other Services or
modified or enhanced Services (e.g.,
the introduction of new Software applications will be considered with the
related retirement of Software applications).


 


(d)                                The Provider Project Executive and Idearc
Program Manager will meet to determine whether they desire for Provider to
proceed with the implementation of the proposed Service Change in accordance
with the applicable Change Analysis, and if the Provider Project Executive and
Idearc Program Manager desire to proceed with the implementation of the
proposed Service Changes, they shall evidence such agreement in writing (a “Change Order”).  Neither Party shall have any obligation with
respect to a Service Change unless and until a Change Order has been signed by
both Parties.


 


(e)                                 Following implementation of any Service
Change, all affected Exhibits and Schedules to the Agreement, shall be updated
in accordance with the applicable Change Order. 
Notwithstanding any provision of the Agreement to the contrary, a
Service Change that does not constitute a New Service or does not, individually
or in the aggregate (when considered on a net basis with related Service
Changes), require materially different levels or types of effort, resources or
expense from Provider shall not result in an increase in the Charges payable by
Idearc hereunder, except as otherwise agreed by Idearc.


 


31

















 


9.11.                       Compliance with Laws.


 


(a)                                 Allocation of
Compliance Responsibility.  Each Party shall comply with
all Laws applicable to its respective businesses and facilities (“General Laws”).  Without limiting the generality of the
preceding sentence, in addition to General Laws, Provider shall comply with all
Laws, including Data Privacy Laws as set forth in paragraph (b) below,
applicable to it as a provider of publishing services or Publishing BPO
Services (“Provider Laws”).  Without limiting the generality of the first
sentence of this paragraph (a), in addition to General Laws, Idearc shall
comply with all Laws, including Data Privacy Laws as set forth in paragraph (b) below,
specifically applicable to Idearc’s receipt and use of the Services and its
core businesses (the “Idearc
Laws”).  Idearc shall be
responsible, with Provider’s cooperation and assistance, for interpreting
Idearc Laws or changes in Idearc Laws and for identifying the impact of such
Idearc Laws or changes in Idearc Laws on Provider’s performance and Idearc’s or
the receipt and use of the Services. 
Provider shall be responsible, with Idearc’s cooperation and assistance,
for interpreting Provider Laws or changes in Provider Laws and for identifying
the impact of such Provider Laws or changes in Provider Laws on Provider’s
performance and Idearc’s or the receipt and use of the Services.


 


(b)                                Data Privacy Laws. 
Without limiting paragraph (a) above, with respect to any Idearc
Personal Data in Provider’s custody or control, Provider shall comply with any
obligations imposed on Provider under any applicable Data Privacy Laws to the
extent that such Data Privacy Laws are applicable to Provider as a processor of
data, and Idearc shall comply with any obligations imposed on Idearc under any
applicable Data Privacy Laws to the extent that such Data Privacy Laws are
applicable to Idearc as a controller of data. 
In addition, and as part of the Services, Provider shall provide Idearc
with such assistance as Idearc may reasonably request to fulfill its
responsibilities under such Data Privacy Laws. 
Provider also shall comply with the Idearc privacy policy set forth in
the Policies and Procedures Manual or otherwise previously communicated (in
writing or electronically) to Provider.


 


(c)                                 Notices; Changes in
Laws.  Provider shall promptly notify Idearc of any
changes in Provider Laws applicable to Provider’s provision of the Services or
Idearc’s receipt and use of the Services. 
In addition, Provider shall use Commercially Reasonable Efforts to
promptly notify Idearc of any other Laws and changes in Laws of which Key
Provider Personnel become aware that are otherwise applicable to Provider’s
provision of the Services or Idearc’s or the receipt and use of the Services
but without assuming an affirmative obligation of inquiry.  In the event of any change in Laws that
requires a change, modification or enhancement of the Services, the Parties,
subject to Section 9.10, shall implement any necessary
modifications to the Services prior to the deadline imposed by the regulatory
or governmental body having jurisdiction for such requirement or change.
Provider shall implement such modifications to the Services (i) to the
extent resulting from any change in Provider Laws, at Provider’s expense, and (ii) to
the extent resulting from any change in Idearc Laws as a New Service or


 


32

















 


Change Order.  In no event shall
either Party be obligated to interpret or offer legal advice regarding Laws
applicable to the other Party.  With
respect to Idearc Laws, Idearc shall retain the right, in its sole discretion,
to interpret and determine the impact of such Idearc Laws on the Services to be
provided by Provider.


 


(d)                                Noncompliance. 
Each Party shall promptly notify the other Party if it becomes aware, or
receives an allegation, that it is not in compliance with any Laws that relate
to Provider’s provision, or Idearc’s or the receipt and use, of the Services,
specifying in reasonable detail the nature of the noncompliance or alleged
noncompliance and identifying the applicable Law.


 


(e)                                 Responsibility. 
Provider shall obtain and maintain all licenses, approvals, permits and
authorizations required by, and applicable to, Provider under applicable Law to
perform the Services, including responsibility for all associated fees and
taxes.  Provider shall be responsible for
any fines or penalties imposed on Provider, Idearc or members of the Idearc
Group resulting from any failure of Provider or its subcontractors or third
party product or service providers to comply with Laws for which it has
responsibility pursuant to the Agreement, respond in a timely manner to changes
in such Laws or to comply with the terms and conditions of the Agreement to the
extent such noncompliance causes Idearc to fail to comply with Laws applicable
to Idearc.  Idearc shall be financially
responsible for (i) obtaining any license, approval or permit in
connection with the use or receipt of Services and (ii) any fines or
penalties imposed on Idearc, Idearc Group members or other permitted recipients
of the Services resulting from any failure of Idearc to comply with Laws for
which it has responsibility pursuant to the Agreement or to respond in a timely
manner to changes in such Laws.  In
addition, Idearc shall be responsible for any fines or penalties imposed by a
governmental or regulatory body that are imposed on Provider if such fines or
penalties would not have been imposed on Provider but for Provider’s compliance
with the specific written instructions provided by Idearc with respect to
Idearc Laws.


 


(f)                                   Assistance to Idearc. 
Upon Idearc’s reasonable request from time to time, and in accordance
with Section 9.7, Provider shall provide Idearc with data and
reports regarding the Services or Idearc Data that is in Provider’s possession
to the extent necessary for Idearc to comply with all Laws applicable to
Idearc.  Subject to Section 9.10,
Provider shall assist Idearc in its efforts to comply with applicable Laws
(including any changes to Laws) that are not related to the Services.


 


9.12.                       Subcontractors.


 


(a)                                 Use of Subcontractors. 
Provider shall not subcontract its obligations under the Agreement
without the prior written consent of Idearc; provided,
however, that Idearc’s consent
shall not be required with respect to (i) the approved subcontractors
identified in each Transaction Document, or (ii) any subcontracting
arrangement with an annual contract value that is less than $100,000, or (iii) any
subcontracting arrangement for ancillary services that are in support of
Provider’s provision of the Services (e.g.,
janitorial services or catering


 


33

















 


services).  With respect to any
subcontracting arrangement requiring Idearc’s consent, Provider shall give Idearc
reasonable prior notice of the subcontract, specifying the components of the
Services affected, the scope of the proposed subcontract, the identity and
qualifications of the proposed subcontractor, and the reasons for
subcontracting the work in question.


 


(b)                                Requested
Removal/Replacement of Subcontractor.  If (i) Idearc
lawfully and in good faith determines that the continued provision of Services
by a Provider subcontractor that is an individual is not in the best interests
of Idearc, or (ii) Idearc determines in good faith that the performance of
a Provider subcontractor that is an Entity is deficient, then Idearc shall give
Provider notice to that effect requesting that such Provider subcontractor be
replaced, and Provider shall, as soon as practicable, remove and replace such
subcontractor; provided, however, with respect
to subcontractors and subcontractor employees that are Affiliates of Provider,
any such Idearc requests shall be handled in accordance with Section 8.4.  In all cases, Provider shall continue to
perform its obligations under the Agreement, notwithstanding the removal of the
subcontractor.  If Idearc lawfully and in
good faith determines that the continued provision of Services by a Provider
subcontractor’s employee is not in the best interests of Idearc, then Idearc
shall give Provider notice to that effect requesting that such Provider
subcontractor’s employee be replaced for the purposes of providing such
Services.  As soon as practicable,
Provider shall require Provider subcontractor to replace such Provider
subcontractor’s employee with an individual of suitable ability and
qualifications at no additional cost to Idearc. 
In addition, Idearc reserves the right, in its sole discretion, to
disapprove of any Provider Personnel designated to work at a Idearc Services
Location for any reason and to require that any such person be replaced.  Nothing in this provision shall operate or be
construed to limit Provider’s responsibility for the acts or omission of
Provider Personnel.


 


(c)                                 Subcontractor Wind-Down
Costs.  Unless otherwise expressly agreed by Idearc in the
Agreement, Idearc shall have no responsibility for any charges, fees or other
expenses, including termination or cancellation fees, that Provider may be
obligated to pay to a subcontractor as a result of (i) the expiration of
the Agreement, (ii) the termination of the Agreement with respect to all
or any part of the Services, (iii) the removal of such subcontractor at
Idearc’s request pursuant to this Section 9.12 or (iv) the
reduction of the Services then performed by such subcontractor as permitted
under the Agreement.


 


(d)                                Provider Responsibility. 
Unless otherwise approved by Idearc, the terms of any subcontract, to
the extent applicable to the particular subcontracting arrangement, must be
consistent with the Agreement, including with respect to (i) confidentiality
and intellectual property obligations; (ii) Idearc’s approval rights
(which shall apply directly to the subcontractor); and (iii) compliance
with reasonable Idearc policies and directions. 
Provider shall be Idearc’s sole point of contact regarding the Services,
including with respect to payment. 
Provider shall be responsible and liable for any Provider subcontractor
or subcontractor


 


34

















 


personnel performance under the Agreement to the same extent as if such
obligations were performed by Provider or Provider employees.


 


9.13.                       Cooperation with Third-Party Contractors.


 


(a)                                 Provider Cooperation. 
As part of the Services, Provider shall cooperate with and work in good
faith with Idearc or Idearc Third-Party Contractors as reasonably requested by
Idearc.  Such cooperation may include (i) providing,
in a timely manner, reasonable access to any Service Locations to the extent necessary
for Idearc Third-Party Contractors to perform the work assigned to them; (ii) providing,
in a timely manner, reasonable electronic and physical access to the business
processes and associated Equipment, Software and/or Systems to the extent necessary
and appropriate for Idearc Third-Party Contractors to perform the work assigned
to them; (iii) providing, in a timely manner, written requirements,
standards, policies or other documentation for the business processes and
associated Equipment, Software or Systems procured, operated, supported or used
by Provider in connection with the Services; or (iv) using Commercially
Reasonable Efforts (in cooperation with Idearc) to minimize any degradation in
the Services caused by the adjustments made by Provider in transferring
Services to a third party or Idearc; provided,
however, that provision to any third party of any access or
information constituting Provider Confidential Information or Provider
Materials shall first require that such third party agree in writing to
confidentiality provisions reasonably required by Provider.  So long as such cooperation can be provided
using resources otherwise assigned to the provision of Services without
adversely impacting the performance of Services, such cooperation will be
provided at no additional charge as part of the Services.  If such cooperation cannot be provided using
then-assigned resources without adversely impacting the performance of other
Services, then such cooperation will be provided through the operation of Section 9.10.  In addition, if any confidential information
of a third party is to be provided to Provider, Provider shall agree in writing
to comply with such third party’s customary and reasonable confidentiality and
security procedures.  Idearc shall use
Commercially Reasonable Efforts to require (contractually or otherwise) Idearc
Third-Party Contractors to comply with (1) Provider’s customary and
reasonable security and confidentiality requirements and routine security
procedures, and, (2) to the extent performing work on Software, Equipment
or Systems for which Provider has operational responsibility, Provider’s
customary and reasonable standards, methodologies, and procedures.


 


(b)                                Notice by Provider. 
Provider shall promptly notify the Idearc Program Manager when it
becomes aware that an act or omission of an Idearc Third-Party Contractor is
reasonably expected to cause, or has caused, an adverse impact or delay in
providing the Services, and shall use Commercially Reasonable Efforts to work with
Idearc and Idearc Third-Party Contractors to prevent or circumvent such problem
or delay.  Provider shall cooperate with
Idearc and Idearc Third-Party Contractors to resolve differences and conflicts
arising between the Services and other activities undertaken by Idearc and
Idearc Third-Party Contractors.


 


35

















 


Any notification provided by Provider in accordance with this paragraph
(b) shall not excuse Provider from the performance of any of its
obligations under the Agreement.


 


9.14.                       Requirement
of Writing.  To the
extent Provider or Idearc is required under the Agreement to obtain the other
Party’s approval, consent or agreement, such approval, consent or agreement
shall be in writing and shall be signed by the Provider Project Executive (or
his or her designee) and the Idearc Program Manager (or his or her
designee).  Notwithstanding the preceding
sentence, the Idearc Program Manager and/or the Provider Project Executive may
agree in advance in writing that as to certain specific matters for which oral
approval, consent or agreement will be sufficient.


 


ARTICLE X


CHARGES


 


10.1.                       General.


 


(a)                                 Payment of Charges. 
In consideration of Provider’s performance of the Services, Idearc
agrees to pay Provider the applicable Charges calculated in accordance with Schedule
10.1.


 


(b)                                No Additional Charges. 
Idearc shall not pay any Charges for the Services in addition to those
expressly set forth in the Agreement. 
Any costs incurred by Provider prior to the Tower Commencement Date will
be included in the Charges set forth in Schedule 10.1 and will not be
separately paid or reimbursed by Idearc.


 


(c)                                 No Charge for
Reperformance.  At no additional expense to Idearc, Provider
shall reperform (including any required backup or restoration of data) any
Services that result in incorrect outputs due to an error or breach by
Provider, and the resources required for such performance will not be counted
in calculating the Charges payable or resources utilized by Idearc hereunder.


 


(d)                                Incidental Expenses. 
Provider acknowledges that, except as expressly provided otherwise in
the Agreement, expenses that Provider incurs in providing the Services
(including management, training, travel and lodging, document reproduction and
shipping, desktop Equipment and other office Equipment required by Provider
Personnel, and long-distance telephone) are included in the Charges.  Accordingly, such Provider expenses are not
separately reimbursable by Idearc unless Idearc has agreed in advance to reimburse
Provider for the expense.  Furthermore,
in addition to any other financial responsibilities of Provider contemplated by
the Agreement, Provider shall pay all costs and expenses with respect to which
Financial Responsibility has not been expressly assigned to Idearc, and which
are not reasonably related to Idearc’s express obligations under the Agreement.   With regard to those expenses for which Idearc
has expressly assumed Financial Responsibility, Provider agrees that
reimbursement for such expenses will be subject to, and in accordance with,
Idearc’s Expense Reimbursement Policy attached hereto as Exhibit B.


 


36

















 


10.2.                       Invoicing.


 


(a)                                 Invoice. 
On or before the 21st day of each month, Provider shall present Idearc
with an invoice for the Charges for the prior month’s Services.


 


(b)                                Format and Data. 
Provider shall provide each invoice electronically (if requested by
Idearc) and in the form approved by Idearc prior to the initial Tower
Commencement Date.  Provider shall
include in each invoice the pricing calculations and related data utilized to
calculate the Charges and sufficient information to validate the service
volumes and associated Charges.  Each
invoice also shall meet (i) all applicable accounting and other legal and
regulatory requirements (ii) any other reasonable business requirements
and objectives of Idearc.  All reporting
and invoicing for Services will be compatible with and integrate with Idearc’s
systems.


 


(c)                                 Credits. 
To the extent a credit may be due to Idearc pursuant to the Agreement,
Provider shall provide Idearc with an appropriate credit against amounts then
due and owing on the invoice for the month immediately following the month in
which the credit accrued.  If no further
payments are due to Provider, Provider shall pay such amounts to Idearc within
30 days.


 


(d)                                Service Taxes. 
Each invoice shall include a breakout of Charges that are subject to
Service Taxes and those that are not subject to Service Taxes.  In addition, each invoice will include a
line-item describing all applicable Service Taxes owed by Idearc for the
applicable month.


 


(e)                                 Time Limitation. 
If Provider fails to invoice Idearc for any amount within 120 days after
the month in which the Services in question are rendered or the expense
incurred, Provider shall be deemed to have waived any right it may otherwise
have to invoice for and collect such amount.


 


10.3.                       Payment Due.


 


(a)                                 Subject to the other provisions of this Article X
and for each invoice delivered to Idearc in accordance with Section 10.2,
each invoice shall be due and payable 30 days after receipt by Idearc of such
invoice, in each case unless the amount in question is disputed in accordance
with Section 10.11.  Payment
will be made by Idearc to Provider in United States dollars.  All amounts to be paid by Idearc under the
Agreement will be paid by wire transfer of immediately available funds to the
account or accounts designated by Provider from time to time or by such other
method as is mutually determined by the Parties.  Provider reserves the right to apply interest
at 1% per month on any undisputed amounts not paid when due.


 


(b)                                If Idearc remits full payment of
undisputed amounts in respect of any invoice no later than [Redacted] following
receipt of such invoice, the total amount due and payable shall be credited
with a [Redacted]% early payment discount.


 


37
















 


[**CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO 17 C.F.R. §240.24b-2
AND 17 C.F.R. §200.80**] 


 


10.4.                        Chargeback.  Provider’s invoices will provide the
chargeback information required by Schedule 10.1.


 


10.5.                        Proration.  Periodic charges under the Agreement are to
be computed on a calendar month basis, and shall be prorated for any partial
month on a calendar day basis.


 


10.6.                        Refundable Items; Credits.


 


(a)                                  Prepaid Amounts. 
If Idearc has prepaid for a service or function for which Provider is
assuming Financial Responsibility under the Agreement, Provider shall refund to
Idearc, upon either Party identifying the prepayment, that portion of such
prepaid expense which is attributable to periods on and after the Tower
Commencement Date.  If approved by Idearc
in advance, Idearc shall reimburse Provider for that portion of any amount
prepaid by Provider that is attributable to the period on and after the later
of the end of the Term or the completion of Termination Assistance Services.


 


(b)                                 Refunds and Credits. 
If Provider receives a refund, credit, discount or other rebate for
goods or services paid for by Idearc on a Pass-Through Expense, retained
expense, cost-plus or cost-reimbursement basis, then Provider shall (i) notify
Idearc of such refund, credit, discount or rebate and (ii) promptly credit
the full amount of such refund, credit, discount or rebate to Idearc on the
next monthly invoice.


 


(c)                                  Unused Credits. 
Any unused credits against future amounts owed to either Party by the
other pursuant to the Agreement will be paid to the applicable Party within 30
days after the expiration or termination of the Agreement.


 


10.7.                        Pass-Through
Expenses.  Unless
otherwise agreed by the Parties, Idearc shall pay all Pass-Through Expenses
directly to the applicable vendors following review, validation and approval of
such Pass-Through Expenses by Provider and proper authorization by Idearc.  Provider shall not charge any margin or
handling or administrative charge or any other markup of any kind in connection
with its processing or review of such Pass-Through Expenses.  All pre-approved Pass-Through Expenses as of
the applicable Tower Commencement Date, if any, will be detailed in the
corresponding Transaction Document.  No
Pass-Through Expenses may be added without Idearc’s prior consent.  Before submitting an invoice to Idearc for
any Pass-Through Expense, Provider shall review and validate the invoiced
charges, identify any errors or omissions and communicate with the applicable
vendor to correct any errors or omissions and resolve any questions or issues
and obtain any applicable credits for Idearc. 
Provider shall deliver to Idearc the original vendor invoice, together
with any documentation supporting such invoice and a statement that Provider
has reviewed and validated the invoiced charges, at least 30 days prior to the
date on which payment is due.  In
addition, if the vendor offers a discount for payment prior to a specified
date, Provider shall deliver such


 


38

















 


invoice
and associated documentation to Idearc at least three days prior to such
date.  To the extent Provider fails to
comply with its obligations hereunder, Provider shall be financially
responsible for any discounts lost or any late fees or interest charges
incurred by Idearc.  In addition,
Provider shall be financially responsible for any Pass-Through Expense that is
not processed and forwarded to Idearc for payment by the end of the third month
after the month in which Provider received a correct and accurate third party
invoice for such Pass-Through Expense.


 


10.8.                        Extraordinary
Events.


 


(a)                                  An “Extraordinary Event”
shall mean any one or combination of the following events or circumstances (or
series of such events or circumstances) with respect to Idearc’s business that
results or shall result in a sustained and material change in the scale or
volume of the Services that Idearc shall require from Provider: (i) mergers,
acquisitions, divestitures or reorganizations involving Idearc; or (ii) changes
in the number or type of business segments in which Idearc operates.


 


(b)                                 If Idearc
notifies Provider of the occurrence of an Extraordinary Event, then the Parties
initially shall consider in good faith whether the particular events or
circumstances are an Extraordinary Event. 
However, if the Parties agree that the particular events or
circumstances are an Extraordinary Event, then the Parties shall initially
attempt to agree on a reasonable basis upon (i) the Targeted Resource
Reductions, Targeted Cost Reductions, Targeted Resource Additions and Targeted
Cost Increases, and (ii) the appropriate adjustment to the Charges and the
timing thereof.  If within sixty (60)
days after the date of Idearc’s notice of an Extraordinary Event the Parties
have not agreed upon any of the foregoing, then at the initiative of Idearc the
issue shall be treated as a dispute under Article XIX.  Only Idearc may declare an Extraordinary
Event..


 


(c)                                  Upon the
Parties’ agreement on (i) the Targeted Resource Reductions, Targeted Cost Reductions,
Targeted Resource Additions and Targeted Cost Increases, and (ii) the
appropriate adjustment to the Charges and the timing thereof, the Charges shall
be adjusted in accordance with this subsection. 
Provider’s adjustment in resources used to provide the Services shall be
in accordance with a plan prepared by Provider and approved by Idearc or, in
the absence of such plan, as reasonably requested by Idearc.  Provider shall proceed to eliminate the
Targeted Resource Reductions as quickly as feasible and Provider shall proceed
to deploy the Targeted Resource Additions as quickly as feasible, in each case
given Idearc’s requirements.  As the
Targeted Resource Reductions are eliminated, the Charges shall be reduced by
the full amount of the Targeted Cost Reductions applicable to Targeted Resource
Reductions.  As the Targeted Resource
Additions are placed into service, the Charges shall be increased by the full
amount of the Targeted Cost Increases applicable to such Targeted Resource
Additions.


 


(d)                                 As used in the Agreement, in connection
with an Extraordinary Event:


 


39

















 


(i)                                    “Targeted
Cost Increases” shall mean the costs and expenses (including
appropriate indirect and overhead expenses) and a reasonable profit that would
be incurred as and when the Targeted Resource Additions are placed in service.


 


(ii)                                “Targeted
Cost Reductions” shall mean the costs and expenses (including
appropriate indirect and overhead expenses) and related profit that can be
eliminated or reduced as and when the Targeted Resource Reductions are
eliminated.


 


(iii)                             “Targeted
Resource Additions” shall mean those new or modified resources
newly required by Provider to provide the Services.


 


(iv)                             “Targeted
Resource Reductions” shall mean those resources no longer
required by Provider to provide the Services.


 


10.9.                        Efforts
to Reduce Costs and Charges. At least annually,
Provider shall identify, and notify Idearc of, methods that Idearc can employ
to use the Services more efficiently and thus minimize the fees paid by Idearc
under the Agreement.  Additionally, from
time to time, Idearc may request that the Parties work together to identify
ways to achieve reductions in the cost of service delivery and corresponding
reductions in the Charges to be paid by Idearc by modifying or reducing the
nature or scope of the Services to be performed by Provider, the applicable
Service Levels or other contract requirements. 
If requested by Idearc, Provider shall promptly prepare a proposal
identifying reasonably available means of achieving the desired reductions
without adversely impacting business objectives or requirements identified by
Idearc.  Provider shall negotiate in good
faith with Idearc regarding any requested reduction in Charges and, without
disclosing Provider’s actual cost of providing the Services, shall identify for
Idearc if and to what extent the cost of service delivery may be reduced by
implementing various changes in the contract requirements.  Idearc shall not be obligated to accept or
implement any proposal.  To the extent
any of Provider’s or Idearc’s proposals are projected to increase Productivity,
such proposals shall be handled in accordance with Section 5.6.


 


10.10.                  Set Off.  With respect to any amount to be paid or
reimbursed by Idearc under the Agreement, Idearc may set off against such
amount any undisputed amount that Provider is obligated to pay Idearc under the
Agreement.


 


10.11.                  Disputed
Charges. Idearc may withhold payment of particular Charges that Idearc
disputes in good faith and only until such dispute has been resolved, subject
to the following:


 


(a)                                  Notice of Dispute. 
If Provider’s invoice includes sufficient detail and supporting
documentation to enable Idearc to reasonably determine whether Provider’s
Charges comply with the Agreement, Idearc shall notify Provider on or before
the payment due date of such invoice if it disputes any of the Charges in such
invoice.


 


40

















 


(b)                                 Notice of Insufficient
Detail, Documentation and Dispute.  If Provider’s
invoice does not include sufficient detail and supporting documentation to
enable Idearc to reasonably determine whether Provider’s Charges comply with
the Agreement, Idearc shall so notify Provider as promptly as practicable after
Idearc’s determination that such insufficiency exists.  Upon receipt of such notice, Provider shall
promptly provide such reasonable detail and supporting documentation to Idearc,
and Idearc shall notify Provider promptly upon receipt thereof by the Idearc
Program Manager whether it disputes any of the Charges in Provider’s invoice.


 


(c)                                  Description and
Explanation.  If Idearc disputes any Charges, Idearc’s
notice to Provider shall include a description of the particular charges in
dispute and an explanation of the reason why Idearc disputes such charges.


 


(d)                                 No Waiver. 
Neither the failure to dispute any Charges or amounts prior to payment
nor the failure to withhold any amount shall constitute, operate or be
construed as a waiver of any right Idearc may otherwise have to dispute any
Charge or amount or recover any amount previously paid.


 


(e)                                  Expedited Dispute
Resolution.  If Idearc withholds payment of any Charges
pursuant to this Section 10.11, either Party may, upon notice to
the other Party, immediately refer such dispute to the senior corporate
executives specified in Article XIX, for attempted resolution of
such dispute in accordance with the procedures in Article XIX.


 


(f)                                    Payment. 
Disputed Charges will be paid, if applicable, net 30 days after
resolution of the dispute.


 


10.12.                  Taxes.  The Parties’ respective responsibilities for
taxes arising under or in connection with the Agreement shall be as follows:


 


(a)                                  Income Taxes. 
Each Party shall be responsible for its own Income Taxes.


 


(b)                                 Sales, Use and Property
Taxes.  Each Party shall be responsible for any
sales, lease, use, personal property or other such taxes on any Equipment,
Software or other property with respect to which it has Financial
Responsibility under the Financial Responsibility Matrix.


 


(c)                                  Taxes on Goods or
Services Used by Provider.  Provider shall be responsible
for all sales, service, value-added, lease, use, personal property, excise,
consumption, and other taxes and duties payable by Provider on any goods or
services used or consumed by Provider in providing the Services.


 


(d)                                 Service Taxes.


 


(i)                                     Idearc shall be financially responsible for all Service
Taxes; provided  that
these taxes are properly billed to Idearc by Provider.  To the extent these


 


41

















 


taxes are not properly billed to Idearc or are not remitted
to the jurisdictions, Provider is financially responsible for such taxes.


 


(ii)                                  After the Effective Date and unless otherwise mutually agreed
by the Parties in a Change Order or otherwise, if either Party moves all or
part of its operations to a different jurisdiction, the Party initiating such
move will be responsible for the excess of (x) any Service Taxes required
to be remitted in connection with an invoice referred to in Section 10.2(a) over
(y) the Service Taxes that would have been required to be remitted in
connection with such invoice had such operations not been moved.


 


(e)                                  Withholding. 
Any withholding tax or other tax of any kind that Idearc is required by
applicable Law to withhold and pay on behalf of Provider with respect to
amounts payable to Provider under the Agreement shall be deducted from such
amount prior to remittance to Provider. 
Idearc will provide to Provider reasonable assistance, which shall include
the provision of documentation or certification as required by revenue
authorities, to enable Provider to claim exemption from or obtain a repayment
of such withheld taxes and will, upon request, provide Provider with a copy of
the withholding tax certificate.


 


(f)                                    Efforts to Minimize
Taxes.  The Parties shall cooperate fully with each
other to enable each to more accurately determine its own tax liability with
respect to the Services and the other transactions contemplated by the
Agreement and to minimize such liability to the extent legally
permissible.  Provider’s invoices shall
separately state the Charges that are subject to taxation and the amount of
taxes included therein.  Each Party shall
provide and make available to the other any resale certificates, information
regarding out-of-state or out-of-country sales or use of equipment, materials,
or services, and other exemption certificates or information reasonably
requested by either Party.  At Idearc’s
request, Provider shall provide Idearc with written evidence of Provider’s
filing of all required tax forms and returns and its remittance of all
applicable Service Taxes.


 


(g)                                 Tax Audits or
Proceedings.  Each Party shall promptly notify the other
of, and coordinate with the other the response to and settlement of, any claim
for taxes asserted by applicable taxing authorities for which the other Party
is responsible hereunder.  With respect
to any claim arising out of a form or return signed by a Party to the Agreement,
such Party shall have the right to elect to control the response to and
settlement of the claim, provided that such Party shall give the other Party (i) a
reasonable opportunity to participate (at its own cost and expense) in any
administrative contest or proceeding relating thereto and (ii) a
reasonable opportunity to review (at its own cost and expense) prior to
submission the terms of any material communication such Party undertakes as
part of such response and settlement. 
The Party controlling the response to and settlement of the claim (i) shall
keep the other Party reasonably apprised as to the status thereof, and (ii) shall
obtain the prior written consent of the other Party before entering into any
settlement of such claim asserting any liability against the other Party,
imposing any obligations or restrictions on the other Party, or otherwise
adversely


 


42

















 


impacting the other Party.  If either Party requests the other to
challenge the imposition of any tax, the requesting Party shall reimburse the
other for all fines, penalties, interest, additions to taxes or similar
liabilities imposed in connection therewith, plus the reasonable legal fees and
expenses incurred in connection with participating in such challenge.  A Party shall be entitled to any tax refunds
or rebates granted to the extent such refunds or rebates are of taxes that were
paid by it.


 


(h)                                 Tax Filings. 
Each Party shall file its appropriate tax returns, and pay applicable
taxes owed arising from or related to the provision of the Services in
applicable jurisdictions.  Provider shall
remit Service Taxes in all applicable jurisdictions.


 


(i)                                     Access Fees; Surcharges. 
To the extent that any allocation among Provider customers of any local
access fee, or surcharge, or other similar tax, fee or surcharge applicable to
the telecommunications portion of the Services is within Provider’s discretion,
Provider shall act fairly and equitably in allocating such taxes, fees and
surcharges to Idearc and shall not treat Idearc less favorably than any
similarly situated Provider customer.  If
any such tax, fee or surcharge is subsequently reduced or vacated by the
appropriate regulatory authority or a court of competent jurisdiction, Provider
shall seek a refund on Idearc’s behalf.


 


10.13.                  Benchmarking.


 


(a)                                  General. 
Beginning on the second anniversary of the Tower Commencement Date of
each Transaction Document and thereafter no more than once per year,  Idearc
may, at its option, engage an independent third party selected pursuant to paragraph
(b) below (a “Benchmarker”)
to compare the Charges for the Services under such Transaction Document against
the prices charged by the Peer Group for the same or similar Services (“Benchmarking”).


 


(b)                                 Selection of
Benchmarker.  To initiate any Benchmarking, Idearc shall
give written notice to Provider specifying the Services to be subjected to
Benchmarking.  Idearc may select and
engage, in its sole discretion, (1) any Entity listed on Schedule 10.13(b) (or
their successors or Affiliates) or (2) any other Entity that (i) is
an independent and industry-recognized third party with benchmarking expertise,
(ii) is not considered a principal competitor to Provider in the provision
of publishing outsourcing services or business process outsourcing services, in
each case similar to the Services, (iii) is not affiliated or associated
with either Party in such a manner as to reasonably create a material conflict
of interest; and (iv) agrees to reasonable confidentiality and security
arrangements applicable to such Benchmarking. 
Upon selection of a Benchmarker, Idearc shall provide Provider prompt
notice thereof.  Subject to Section 10.13(e),
Idearc will be financially responsible for the payment of the fees and expenses
of the Benchmarker.


 


(c)                                  Instructions; Assistance. 
Idearc and Provider shall jointly give all instructions to the
Benchmarker and shall instruct the Benchmarker to prepare and present to


 


43

















 


them a Benchmarking plan.  Each of the Parties shall cooperate to
facilitate the Benchmarking, including by providing such assistance and
information as is reasonably necessary to conduct the Benchmarking.  Without limiting the generality of the
foregoing, Provider shall cooperate with Idearc and the Benchmarker during the
Benchmarking and shall provide the Benchmarker (i) reasonable access to
relevant premises, equipment, personnel, documents and information, and (ii) any
assistance reasonably requested by the Benchmarker to conduct the Benchmarking;
provided, however, that Provider
shall not be required to provide any information with respect to Provider’s
margins or costs, except to the extent such margins or costs are the basis upon
which Idearc is charged (e.g., cost-plus pricing).


 


(d)                                 Benchmarker’s Process. 
In making such comparison, the Benchmarker shall conduct a “like-for-like”
comparison by comparing the type of service provided, service levels, volume of
service, locations where services are provided, term and such other information
as the Benchmarker determines is relevant. 
In connection therewith, the Benchmarker shall consider normalization
factors such as the following and adjust the prices as and to the extent
appropriate in the Benchmarker’s sole discretion:  (i) whether vendor transition charges
are paid by the customer as incurred or amortized over the term of the
agreement; (ii) the extent to which vendor pricing includes the purchase
of the customer’s existing assets; (iii) the extent to which vendor
pricing includes the cost of acquiring future assets; (iv) the extent to
which the Agreement requires Provider to provide and comply with unique Idearc
requirements; (v) whether Service Taxes are included in such pricing or
stated separately in vendor invoices; (vi) the currency of the pricing data,
and (vii) differences in volume of services (scale), scope of services,
service levels, financing or payment streams, geographic distribution
(including the use of offshore facilities and labor, complexity of supported
environment, technologies employed, terms and conditions and other pertinent
factors).  Where the direct and precise
application of any limitations, conditions or other constraints relating to the
mix, volume, timing or type of services under any comparable agreement or any
other factor described in this paragraph (d) would yield an anomalous or
inequitable result with respect to either Party, the Benchmarker shall
coordinate with Idearc and Provider to obtain the information necessary to make
reasonable adjustments to appropriately reflect the related differences and
similarities.


 


(e)                                  Result of Benchmarking. 
The Benchmarker shall provide both Parties with a copy of the
Benchmarker’s report setting forth its findings and conclusions.  If the Benchmarker determines that the
Charges paid by Idearc for the Services under the applicable Transaction
Document that are the subject of the Benchmarking exceed the median of the
prices charged by the Peer Group for work of a similar nature, type and volume
(“Benchmark Standard”)
by more than 5%, the Parties shall adjust the Charges to equal 105% of the
median price(s); provided that, if the Charges are
determined to be higher than 10% above the median, the Charges shall be
adjusted to equal the median price(s). 
In addition, Provider shall


 


44

















 


reimburse Idearc for its out-of-pocket costs and expenses incurred in
connection with the Benchmarking.  Such
adjusted Charges will be effective retroactively, if necessary, to the first
date of the calendar month in which the Benchmarker’s report is first delivered
to the Parties.  At Provider’s request,
Idearc shall grant Provider up to 90 days after the date of the Benchmarker’s
report to prepare and implement an agreed plan to bring the Charges into line
with the Benchmarker’s report.  If
Provider fails to make the adjustments as required by this Section 10.13,
Idearc may, at its option, terminate the Agreement with respect to all or any
part of the Services, without payment of any Termination Fees.  If the Agreement is so terminated with
respect to part of the Services, Provider’s Charges shall be equitably adjusted
to reflect the Services no longer performed by Provider.


 


(f)                                    Provider Review and
Dispute.  Provider shall have 30 days from its receipt
of the Benchmarker’s report to review such report and contest the Benchmarker’s
findings.  If Provider concludes in good
faith that the Benchmarker’s report contains manifest errors of fact, Provider
shall notify Idearc by (i) identifying, in reasonable detail, the errors; (ii) providing
any report, data or other evidence that demonstrates and supports Provider’s
conclusion; and (iii) proposing specific proposed amendments to the
Benchmarker’s report (and/or the Benchmarking results) necessary to correct the
errors.  Idearc shall review any such
notice given by Provider and take appropriate action.  If the Parties do not agree on the
appropriate course of action relating to error correction or if the Parties are
unable to agree upon the validity of such findings, the matter shall be
resolved pursuant to the dispute resolution procedures set forth in Article XIX.


 


(g)                                 Benchmarker’s Decisions
Final.  The Benchmarker shall act as an expert and
not as an arbitrator, and, notwithstanding anything in the Agreement to the
contrary (except as provided in paragraph (f) above), the decision of the
Benchmarker on the matters contemplated by this Section 10.13,
shall be final and binding upon the Parties.


 


ARTICLE
XI

REPRESENTATIONS, WARRANTIES AND COVENANTS


 


11.1.                        Idearc
Representations and Warranties.  Idearc hereby represents and warrants to
Provider as follows:


 


(a)                                  Organization; Power. 
Idearc is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware.  Idearc has all requisite corporate power and
authority to execute, deliver and perform its obligations under the Agreement.


 


(b)                                 Authority;
Enforceability.  The execution, delivery and performance of
the Agreement have been duly authorized by all requisite corporate action on the
part of Idearc.  The Agreement
constitutes the legal, valid and binding agreement of Idearc, enforceable
against Idearc in accordance with its terms, except insofar as


 


45

















 


such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
generally creditors’ rights, or by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).


 


(c)                                  Approvals.  Idearc has obtained all
authorizations, approvals, consents or permits required to perform its
obligations under the Agreement under all applicable laws and regulations,
except to the extent the failure to obtain any such authorizations, approvals,
consents or permits would not, in the aggregate, adversely affect in any
material respect Idearc’s ability to perform its obligations under the
Agreement.


 


(d)                                 No Litigation. 
There is no action, claim, suit, litigation, proceeding, arbitration or
investigation pending, or to the knowledge of Idearc, threatened, that would
materially affect Idearc’s ability to execute, deliver or perform its
obligations under the Agreement.


 


(e)                                  No Violation.  The execution, delivery and performance of the Agreement by Idearc does
not violate any judgment, order, or decree by which Idearc is bound, and does
not result in a breach of, or conflict with, or constitute a default under, any
material agreement or contract to which Idearc is a party.


 


11.2.                        Provider
Representations and Warranties.  Each of TCS America and TCSL jointly and
severally hereby represent and warrant to Idearc as follows:


 


(a)                                  Organization; Power. 
TCS America and TCSL, each, is a corporation duly incorporated, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated (i.e. the State of New York and Republic of India,
respectively).  Each of TCS America and
TCSL has all requisite corporate power and authority to execute, deliver and
perform its obligations under the Agreement.


 


(b)                                 Authority;
Enforceability.  The execution, delivery and performance of
the Agreement have been duly authorized by all requisite corporate action on
the part of each of TCS America and TCSL. 
The Agreement constitutes the legal, valid and binding agreement of each
of TCS America and TCSL, enforceable against each of TCS America and TCSL
jointly and severally in accordance with its terms, except insofar as such
enforceability may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting generally creditors’ rights, or by general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).


 


(c)                                  Approvals.  Each of TCS America and TCSL has obtained
all authorizations, approvals, consents or permits required to perform its
obligations under the Agreement under all applicable laws and regulations,
except to the extent the failure to obtain any such authorizations, approvals,
consents or permits would not, in the aggregate, adversely affect in any
material respect the ability of each of TCS America and TCSL to perform its
obligations under the Agreement.


 


46
















 


(d)                                 Inducements. 
Neither TCS America nor TCSL has given commissions, payments, kickbacks,
lavish or extensive entertainment, or other inducements of more than reasonably
nominal value to any employee or agent of Idearc in connection with the
Agreement.


 


(e)                                  No Litigation. 
There is no action, claim, suit, litigation, proceeding, arbitration or
investigation pending, or to the knowledge of each of TCS America and TCSL,
threatened, that would materially affect such entity’s ability to execute,
deliver or perform its obligations under the Agreement.


 


(f)                                    No Violation. 
The execution, delivery and performance of the Agreement by each of TCS
America and TCSL does not violate any judgment, order, or decree by which
either TCS America or TCSL is bound, and does not result in a breach of, or
conflict with, or constitute a default under, any material agreement or
contract to which either TCS America or TCSL is a party.


 


11.3.                        Additional Provider Warranties.


 


(a)                                  Work Standards. 
Provider warrants that (i) the Services shall be provided with
promptness, due care, skill and diligence and in a professional and workmanlike
manner consistent with the practices generally followed by the Peer Group; (ii) Provider
shall use adequate numbers of qualified individuals with suitable training,
education, experience, know-how, competence and skill to perform the Services;
and (iii) Provider has, or will have at the relevant time, the resources,
capacity, expertise and ability in terms of Equipment, Software, know-how and
personnel to provide the Services.


 


(b)                                 Maintenance. 
Provider shall maintain Equipment and Software to the extent that
Provider has maintenance responsibility for such assets such that they operate
in accordance with their specifications, including (i) maintaining Equipment
in good operating condition, subject to normal wear and tear; (ii) undertaking
repairs and preventive maintenance on Equipment in accordance with the
applicable Equipment manufacturer’s recommendations; and (iii) performing
Software maintenance in accordance with the applicable Software vendor’s
documentation and recommendations.


 


(c)                                  Efficiency and Cost
Effectiveness.  Provider shall provide the Services in a
cost-efficient manner consistent with the level of quality and performance
required under the Agreement.


 


(d)                                 Correction of Errors. 
Provider shall promptly correct any errors or inaccuracies (collectively
or individually, an “Error”)
in or with respect to any report, the information or data contained in such
report, or other contract deliverables, in each case delivered by Provider
pursuant to its performance of the Services. 
If the Error did not result from erroneous information received from
Idearc, such Errors shall be corrected at no charge to Idearc.


 


47

















 


(e)                                  Software Warranties.


 


(i)                                     Provider warrants that any Provider Materials that are
Software shall perform in conformance with its Specifications and will provide
the functions and features and operate in the manner described therein.  If Provider Materials that are Software do
not conform to such Specifications, Provider shall promptly repair or replace
such Software with conforming Software.


 


(ii)                                  Provider warrants that it is the owner of, or is authorized
to use for the purpose of providing the Services, all Provider Materials and
Provider Third-Party Materials used in connection with the Services.


 


(f)                                    Non-Infringement. 
Provider shall provide the Services in a manner that does not infringe
or misappropriate any patent, copyright, trademark, trade secret or other
intellectual property rights of any third party; provided,
however, that such warranty will not apply to the extent the
infringement claim arises from Provider’s access or use of any Idearc Materials
or subsequent modification or misuse of the Services after their delivery by
the Provider.


 


11.4.                        Malicious Code; Disabling Code; Spam.


 


(a)                                  Provider shall use standards and
technologies generally followed by the Peer Group for services similar to the
Services to prevent the introduction and proliferation of Malicious Code into
Idearc’s environment or Systems as a result of Services provided by
Provider.  If Malicious Code is found to
have been introduced by Provider into the Equipment, Software or Systems used
by Provider to provide the Services, at no additional charge to Idearc,
Provider shall use Commercially Reasonable Efforts to eliminate the Malicious
Code and minimize, to the extent practicable, the effects of such Malicious
Code and, if the Malicious Code causes a loss of operational efficiency or loss
of data, to assist Idearc to the same extent to mitigate such losses and
restore such data with generally accepted data restoration techniques.


 


(b)                                 Without the prior consent of Idearc,
Provider shall not insert into the Software any code that could be invoked to
disable or otherwise shut down all or any portion of the Services; provided, however, that the foregoing
shall not apply with respect to any programming code, programming instructions
or set of instructions that is (i) incorporated for purposes of applying a
software patch or (ii) to the extent identified to Idearc prior to
installation, distributed as part of Software to ensure that the licensee uses
the product in accordance with the licensing agreement.  Subject to the preceding sentence, with
respect to any disabling code that may be part of the Software, Provider shall
not invoke or cause to be invoked such disabling code at any time, including
upon expiration or termination of the Agreement for any reason.  Provider shall not use on Idearc Systems any
Third-Party Software known to contain disabling code without the prior approval
of Idearc.


 


48

















 


11.5.                        Pass-Through
Warranties; Third-Party Software.  With  respect
to all third-party software or hardware products and services purchased by
Provider for Idearc in connection with the provision of the Services, Provider
shall, in addition to its separate warranties and obligations provided in Sections
11.2 and 11.3, pass through or assign to Idearc the rights Provider
obtains from the vendors of such products and services (including warranty and
indemnification rights), all to the extent that such rights may be reasonably
obtained from the corresponding third party. 
If such assignment of pass-through warranties and indemnities reasonably
acceptable to Idearc are not available from such vendors whose products or
services are dedicated to Idearc, then Provider will discuss the matter with
Idearc prior to engaging the particular vendor, and the Parties shall mutually
determine to either accept the terms available from such vendor, in which case
Provider will enforce the applicable warranty or indemnity on behalf of Idearc
(not to include any obligation to initiate litigation or formal dispute
resolution), or deal with another vendor of comparable products or services
that will provide warranties and indemnities reasonably acceptable to
Idearc.  In the event of a third-party
software or hardware nonconformance under such assigned warranties, Provider
will coordinate with, and be the point of contact for resolution of the problem
through, the applicable vendor and, upon becoming aware of a problem, will
notify such vendor and will use Commercially Reasonable Efforts to cause such
vendor to promptly repair or replace the nonconforming item in accordance with
such vendor’s corresponding warranty. 
Without diminishing its other obligations under the Agreement, if any
warranties or indemnities may not be passed through, Provider shall, upon the
request of Idearc, take commercially reasonable action to enforce (not to
include any obligation to initiate litigation or formal dispute resolution) any
applicable warranty or indemnity that is (i) reasonably relevant and
applicable to the nonconforming Software product or service and (ii) enforceable
by Provider in its own name.


 


11.6.                        Disclaimer.  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED
HEREIN, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES TO THE OTHER,
WHETHER EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.


 


ARTICLE XII

CONFIDENTIALITY


 


12.1.                        Idearc
Ownership of Idearc Data. 
Idearc Data shall remain the property of Idearc.  Upon any request by Idearc, Provider shall
promptly provide Idearc with access to any Idearc Data in the possession of
Provider.  At any time at Idearc’s
request, Provider shall promptly return Idearc Data to Idearc in a form
reasonably requested by Idearc or, if Idearc so elects, Provider shall destroy
the same.  Thereafter, if requested by
Idearc, Provider shall deliver to Idearc written confirmation of such return or
destruction signed by an authorized representative of Provider.


 


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12.2.                        Safeguarding Idearc Data.


 


(a)                                  Safeguarding Procedures.


 


(i)                                     Provider shall establish and maintain safety and facility
procedures, data security procedures and other safeguards against the
destruction, loss, unauthorized access or alteration of Idearc Data in the
possession of Provider that are no less rigorous than the greater of (i) those
maintained by Idearc as of the Effective Date or as subsequently implemented by
Idearc as such safeguards are set forth in the Policies and Procedures Manual
or otherwise previously communicated (in writing or electronically) to
Provider, (ii) those maintained by Provider for similarly situated
customers receiving services of a similar nature, (iii) those safeguards
utilized by Provider to protect its own similar data, or (iv) the
information security requirements set forth in Exhibit C, Idearc’s
Information Security Policy.  Idearc will
have the right to review and approve all such procedures (and any changes
thereto) prior to implementation.


 


(ii)                                  Idearc will have the right to establish backup security for
Idearc Data and to keep backup copies of the Idearc Data in Idearc’s possession
at Idearc’s expense.  Provider shall
provide Idearc with downloads of Idearc Data, as reasonably requested by
Idearc, to enable Idearc to maintain such backup security or backup copies of
Idearc Data.  Provider shall provide
Idearc or its agents (subject to Provider’s reasonable security and
confidentiality requirements) with prompt access to facilities and equipment
under its control or for which it has the ability to provide such access upon
reasonable notice (and, in any case, within five days of its receiving notice)
for the purpose of allowing Idearc to copy and/or destroy any and all Idearc
Data stored at such facilities and/or on such equipment.


 


(iii)                               Provider shall remove all Idearc Data from any media taken
out of service and shall destroy or securely erase such media in accordance
with the Policies and Procedures Manual. 
No media on which Idearc Data is stored may be used or re-used to store
data of any other customer of Provider or to deliver data to a third party,
including another Provider customer, unless securely erased in accordance with
the Policies and Procedures Manual.


 


(iv)                              Provider shall not utilize any Idearc Data for any purpose
other than the performance of Services under the Agreement, and Provider shall
at all times comply with Idearc’s privacy policies to be set forth in the
Policies and Procedures Manual or as otherwise previously communicated (in
writing or electronically) to Provider.  Idearc Data shall not be sold, assigned,
leased, encumbered, commercially exploited or otherwise provided to third
parties by or on behalf of Provider or Provider Personnel.  Provider shall segregate Idearc Data from the
data of any other Provider 


 


50

















 


customer.  Provider shall not allow Provider Personnel
to access Idearc Data that is not required for the provision of Services.


 


(v)                                 If Provider discovers or is notified of a breach or potential
breach of security relating to Idearc Data, Provider shall (i) promptly
notify Idearc of such breach or potential breach, (ii) investigate such
breach or potential breach, (iii) remediate the effects of such breach or
potential breach of security, and (iv) provide Idearc with such assurances
as Idearc shall reasonably request that such breach or potential breach will
not recur.


 


(b)                                 Reconstruction
Procedures.  As part of the Services, Provider shall be
responsible for developing and maintaining procedures for the reconstruction of
lost Idearc Data that are the greater of (i) no less rigorous than those
maintained by Idearc as of the Tower Commencement Date (or implemented by
Idearc in the future to the extent reasonably deemed necessary by Idearc), or (ii) no
less rigorous than those maintained by Provider for its own information of a
similar nature.


 


(c)                                  Corrections. 
Provider shall correct, at no charge to Idearc, any destruction, loss or
alteration of any Idearc Data attributable to the failure of Provider or
Provider Personnel to comply with Provider’s obligations under the Agreement.


 


12.3.                        Confidentiality.


 


(a)                                  Confidential
Information.  Provider and Idearc each acknowledges that
the other possesses and will continue to possess information that has been
developed or received by it, has commercial value in its business and is not in
the public domain.  Except as otherwise
specifically agreed in writing by the Parties, “Confidential Information” shall mean (i) the
Agreement and the terms thereof; (ii) all information of a Party marked
confidential, restricted or proprietary by either Party; and (iii) any
other information of a Party that is treated as confidential by the disclosing
Party and would reasonably be understood by the recipient to be confidential,
whether or not so marked.  In the case of
Idearc, Confidential Information also shall include Software provided to
Provider by or through Idearc, Idearc Materials (including Idearc-owned
Publishing Product), Idearc Data, attorney-client privileged materials,
operational data, attorney work product, Idearc lists, Idearc pricing,
business, financial, operational, strategic and accounting plans and
information (including, but not limited to forecasts and budgets), plans for
changes in Idearc facilities, business units and product and service lines,
plans for mergers, acquisitions or divestitures, plans for the development and
marketing of new products or services, business, accounting and systems
processes, account information, research information, trade secrets, human resources
and personnel information (including employee and client lists and company
telephone or e-mail directories), client information and marketing/sales
information, information regarding businesses, third party contracts, customer
or engagement lists, external or external audits, or other information or data
obtained, received, transmitted, processed, stored, archived, or maintained by
Provider under the Agreement.  In the
case of Provider, 


 


51

















 


Confidential Information shall include financial information, account
information, information regarding Provider’s business plans and operations,
and proprietary software, tools and methodologies owned by Provider and used in
the performance of the Services.


 


(b)                                 Obligations.


 


(i)                                     Neither Provider nor Idearc shall disclose, and each of
Provider and Idearc shall maintain the confidentiality of, all Confidential
Information of the other Party.  Each of
Idearc and Provider shall use at least the same degree of care to safeguard and
to prevent disclosing to third parties the Confidential Information of the
other as it employs to avoid unauthorized disclosure, publication,
dissemination, destruction, loss, or alteration of its own like information (or
information of its customers) of a similar nature, but not less than reasonable
care.  The Parties may disclose
Confidential Information to their respective employees, Affiliates, auditors,
attorneys, accountants, lenders, consultants and contractors, where (A) such
disclosure is reasonably necessary for the performance of such Entity’s or
individual’s obligations under or with respect to the Agreement or otherwise
naturally occurs in such Entity’s or individual’s scope of responsibility, (B) the
Entity (and its applicable officers and employees) or the individual is subject
to confidentiality obligations consistent with this Section 12.3,
and (C) the disclosing Party remains responsible for any breach of this
section by such Entity or individual and takes all reasonable measures to
ensure that the Confidential Information is not disclosed or used in breach of
the Agreement.  Any disclosure to such
Entity or individual will be pursuant to terms consistent with the terms and
conditions as provided herein, but in no event shall Idearc Confidential
Information be used for any marketing, sales, commercial or other competitive
purposes.  Each Party’s Confidential
Information will remain the property of such Party.  In addition, Provider shall disclose Idearc
Confidential Information to its employees only on a “need to know” basis where
such disclosure is reasonably necessary for the performance of the
Services.  Under no circumstances shall
Provider disclose, or permit any disclosure of, any Idearc Confidential
Information to any employees of Provider or its Affiliates who are engaged in
Provider’s consulting or systems integration business unless (1) such
individuals have been previously identified to Idearc in writing and (2) Provider
expressly assumes responsibility for compliance of such individuals with all
terms of the Agreement.


 


(ii)                                  Neither Party shall (A) make any use or copies of the
Confidential Information of the other Party except as contemplated by the
Agreement, (B) assert any lien against or, except as expressly provided in
Article XIII, acquire any right (expressly or impliedly) in the
Confidential Information of the other Party, (C) sell, assign, transfer,
lease, or otherwise dispose of Confidential Information to third parties or
commercially exploit such 


 


52

















 


information,
including through Derivative Works, or (D) refuse for any reason
(including a default or material breach of the Agreement by the other Party) to
promptly provide the other Party’s Confidential Information (including copies
thereof) to the other Party if requested to do so.  Upon expiration or any termination of the
Agreement and completion of each Party’s obligations under the Agreement, each
Party shall return or destroy, as the other Party may direct, all the other
Party’s Confidential Information within 30 days.  Each Party shall deliver to the other Party
written confirmation of its compliance with the preceding sentence signed by an
authorized representative of such Party.


 


(iii)                               Prior to allowing Provider Personnel to use or access any
data or information of any Idearc Service Recipient, Provider shall ensure that
each such Provider Personnel execute and deliver to Idearc a confidentiality or
nondisclosure agreement (the form of which is to be provided by Idearc).


 


(c)                                  Exclusions.  Section 12.3(b) shall
not apply to any particular information that the receiving Party can
demonstrate (i) is, at the time of disclosure to it, in the public domain
other than through a breach of the receiving Party’s or a third party’s
confidentiality obligations; (ii) after disclosure to it, is published by
the disclosing Party or otherwise becomes part of the public domain other than
through a breach of the receiving Party’s or a third party’s confidentiality
obligations; (iii) is lawfully in the possession of the receiving Party
without an obligation of confidentiality at the time of disclosure to it; (iv) is
received from a third party having a lawful right to disclose such information
without breaching any applicable confidentiality obligations; or (v) is
independently developed by the receiving Party without reference to
Confidential Information of the furnishing Party; provided,
however, that the foregoing exclusions shall not apply in connection
with Provider’s breach of Section 12.2 with respect to any Idearc
Data.  In the case of disclosure by
Idearc, Section 12.3(b) shall not apply to any information
related to the Services which Idearc determines in good faith to be necessary
or appropriate to be disclosed in connection with any requests by Idearc for
information or proposals from other service providers, including without
limitation, information of an operational, technical or financial nature
related to Idearc which Idearc desires to make available to such service
providers.  In addition, the receiving
Party shall not be considered to have breached its obligations under this Section 12.3
for disclosing Confidential Information of the other Party as required, in the
opinion of legal counsel, to satisfy any legal requirement of a competent
government body, provided that, promptly upon receiving any such request and to
the extent permitted under applicable Law, such Party advises the other Party
of the Confidential Information to be disclosed and the identity of the third
party requiring such disclosure prior to making such disclosure in order that
the other Party may interpose an objection to such disclosure, take action to
assure confidential handling of the Confidential Information, or take such
other action as it deems appropriate to protect the 


 


53

















 


Confidential Information.  The
receiving Party shall use Commercially Reasonable Efforts to cooperate with the
disclosing Party in its efforts to seek a protective order or other appropriate
remedy or if such protective order or other remedy is not obtained, to obtain
assurance that confidential treatment will be accorded such Confidential
Information.


 


(d)                                 Public Securities
Filings.


 


(i)                                     Notwithstanding paragraphs (b) and (c) above, the
Parties acknowledge that the Agreement, or portions thereof, may be required
under applicable Laws to be disclosed as an exhibit to required public
disclosure documents of Idearc (or its Affiliates) filed with the United States
Securities and Exchange Commission or any securities exchange on which its
securities are listed for trading.  If
Idearc advises Provider that such disclosure is required, Idearc shall use
Commercially Reasonable Efforts to seek approval from the Securities and Exchange
Commission or other applicable regulatory authority for the confidential
treatment of certain Confidential Information identified by the Parties.  Prior to such filing, Idearc shall redact
such portions of the Agreement that Provider reasonably requests to be
redacted, unless, in Idearc’s judgment based on the advice of counsel, Idearc
concludes that such redaction request is inconsistent with Idearc’s obligations
under applicable Laws.


 


(ii)                                  Because Provider Personnel may, by nature of the Agreement,
have access to Idearc’s financial information and other information that, if
utilized or disclosed could lead to violations of the applicable securities
laws, Provider covenants that it: (i) will not trade in securities of
Idearc in violation of any applicable securities laws; and (ii) will
implement and maintain a policy that its employees, agents, and contractors
will not trade in the securities of Idearc in violation of any applicable
securities laws.  As part of that policy,
Provider will require its employees having access to Idearc Confidential
Information to sign written statements indicating that they are aware of the
policy against trading in securities of Idearc in violation of applicable
securities laws, and that will abide by such policy.  The policy implemented by Provider will
specifically advise its employees of their potential status as “insiders” for
purposes of Sections 10 and 16 of the Securities Exchange Act of 1934, as
amended, and the applicable rules promulgated thereunder.


 


(e)                                  Loss of Confidential
Information.  Each Party shall (i) promptly notify the
other Party of any possession, use, knowledge, disclosure, or loss of such
other Party’s Confidential Information in breach of the Agreement; (ii) promptly
furnish to the other Party all known details and assist such other Party in
investigating and preventing the reoccurrence of such possession, use,
knowledge, disclosure, or loss; (iii) cooperate with the other Party in
any investigation or litigation deemed necessary by such other Party to protect
its rights; and (iv) promptly use Commercially Reasonable Efforts to
prevent further possession, use, knowledge,


 


54

















 


disclosure, or loss of Confidential Information in breach of the
Agreement.  If a Party breaches its
confidentiality obligations under this Section 12.3, in addition to
any other rights or remedies the other Party may have, such breaching Party
shall reimburse the other Party for all costs and expenses (including internal
costs) incurred by such other Party in connection with this Section 12.3(e).


 


(f)                                    No Implied Rights. 
Nothing contained in this Section 12.3 shall be construed as
obligating a Party to disclose its Confidential Information to the other Party,
or as granting to or conferring on a Party, expressly or impliedly, any rights
or license to any Confidential Information of the other Party.


 


(g)                                 Survival. 
The Parties’ obligations of non-disclosure and confidentiality under the
Agreement shall survive the expiration or termination of the Agreement
indefinitely.


 


ARTICLE XIII

PROPRIETARY RIGHTS


 


13.1.                        Idearc Materials.


 


(a)                                  Ownership of Idearc
Materials.  Idearc shall be the sole and exclusive owner
of the following items (collectively, the “Idearc Materials”):


 


(i)                                   All Materials owned by Idearc as of the Effective Date and
all Derivative Works of such Materials developed in connection with the
Services (including such Derivative Works so developed under the Agreement
jointly with or solely by Provider), including all United States and foreign
Intellectual Property rights therein;


 


(ii)                                All Materials acquired by Idearc, or by Provider on behalf of
Idearc or members of the Idearc Group in connection with the performance of the
Services, from third parties after the Effective Date and all Derivative Works
of such Materials developed in connection with the Services (including such
Derivative Works so developed under the Agreement jointly with or solely by
Provider), including all United States and foreign Intellectual Property rights
therein; and


 


(iii)                             All Materials developed by Idearc after the Effective Date
and all Derivative Works of such Materials, including all United States and
foreign Intellectual Property rights therein.


 


(b)                                 License to Provider.


 


(i)                                   As of the first Tower Commencement Date, Idearc hereby grants
to Provider a non-exclusive, non-transferable, royalty-free license during the
Term (and thereafter to the extent necessary to provide any Termination
Assistance Services), to Use that portion of the Idearc Materials associated 


 


55

















 


with the
provision of Services under the Agreement (the “Idearc Licensed Materials”) for the sole purpose of providing the Services to Idearc
and members of the Idearc Group.  Such
grant shall be limited to the rights, if any, of Idearc in such Idearc
Materials.


 


(ii)                                  Provider shall not Use Idearc Licensed Materials for any
purpose other than that stated in subparagraph (i) above, and shall not
sublicense any rights with respect to Idearc Licensed Materials except with the
written consent of Idearc.  Provider
shall not (A) use any Idearc Licensed Materials for the benefit of any
Entity or individual other than Idearc or members of the Idearc Group, (B) separate
or uncouple any portions of the Idearc Licensed Materials, in whole or in part,
from any other portions thereof, or (C) reverse assemble, reverse
engineer, translate, disassemble, decompile or otherwise attempt to create or
discover any source code, underlying algorithms, ideas, file formats or
programming interfaces of the Idearc Licensed Materials by any means.


 


(iii)                               Idearc Licensed Materials will be made available to Provider
in such form and on such media as exists on the Effective Date or as is later
obtained by Idearc, together with available documentation and any other related
materials.  Provider shall cease all Use
of, and as elected by Idearc, return or destroy all copies of Idearc Licensed
Materials, together with available documentation and any other related
materials, upon expiration or termination of the Agreement.  If requested by Idearc, Provider shall
certify in writing to Idearc as to the fact of such cessation, return and/or
destruction.


 


(iv)                              THE IDEARC LICENSED MATERIALS ARE PROVIDED BY IDEARC TO
PROVIDER ON AN AS-IS, WHERE-IS BASIS, WITH NO WARRANTIES WHATSOEVER.  IDEARC EXPRESSLY DISCLAIMS ANY
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, AS TO SUCH IDEARC LICENSED
MATERIALS, OR THEIR CONDITION OR SUITABILITY FOR USE BY PROVIDER, INCLUDING ALL
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.  THE PARTIES ACKNOWLEDGE AND AGREE THAT THE
FOREGOING DISCLAIMER SHALL NOT BE CONSTRUED TO LIMIT THE RELIEF OR OTHERWISE
THE INTENT OF SECTION 4.9 OR 5.7(d).


 


13.2.                        Provider Materials.


 


(a)                                  Ownership of Provider
Materials.  Provider shall be the sole and exclusive
owner of the following items (collectively, “Provider Materials”):


 


(i)                                   All Materials owned by Provider as of the Effective Date and
all Derivative Works of such Materials developed in the performance of the
Services (including such Derivative Works so developed under the 


 


56

















 


Agreement
jointly with or solely by Idearc), including all United States and foreign
Intellectual Property rights therein;


 


(ii)                                  All Materials acquired by Provider from third parties after
the Effective Date (other than acquisitions made on behalf of Idearc or members
of the Idearc Group in connection with the performance of the Services) and all
Derivative Works of such Materials developed in the performance of the Services
(including such Derivative Works so developed under the Agreement jointly with
or solely by Idearc), including all United States and foreign Intellectual
Property rights therein; and


 


(iii)                               All Materials developed by Provider after the Effective Date
outside the performance of the Services and the Agreement and all Derivative
Works of such Materials developed in the performance of Services (including
such Derivative Works so developed under the Agreement jointly with or solely
by Idearc), including all United States and foreign Intellectual Property
rights therein.


 


(b)                                 License to Provider
Materials.


 


(i)                                   As of the first Tower Commencement Date, Provider hereby
grants to Idearc and the members of the Idearc Group, at no additional charge,
a non-exclusive, royalty-free, irrevocable, fully paid-up, worldwide license to
Use the Provider Materials (including all modifications, replacements,
Upgrades, enhancements, methodologies, tools, documentation, materials and
media related thereto), during the Term (and thereafter during any Termination
Assistance Period), for the purposes described below.  In addition, at no additional charge,
Provider hereby grants to Idearc Third-Party Contractors a non-exclusive,
royalty-free, irrevocable, fully paid-up, worldwide license to Use such
Provider Materials (including all modifications, replacements, Upgrades,
enhancements, methodologies, tools, documentation, materials and media related
thereto) during the Term (and thereafter during any Termination Assistance
Period), for the purposes described below. 
Provider shall grant such licenses to Idearc, members of the Idearc
Group and Idearc Third-Party Contractors to the extent necessary for the following
purposes:


 


(A)                              The receipt by
Idearc and the members of the Idearc Group of the full benefit of the Services
provided by Provider; and


 


(B)                                The performance
by Idearc, the members of the Idearc Group and the Idearc Third-Party
Contractors for Idearc of the services or functions that are ancillary to, but
not part of, the Services provided by Provider, including related publishing or
business process services and functions.


 


57
















 


(c)           Conflict. 
For the avoidance of doubt, to the extent any provision of this Section 13.2
conflicts with Provider’s obligations regarding Idearc Confidential Information
set forth in Section 12.3, the terms of Section 12.3
shall govern and control.


 


13.3.        Third-Party Materials.


 


(a)           Idearc Third-Party Materials.


 


(i)            With respect to third-party
Materials (“Third-Party Materials”) licensed by Idearc (“Idearc  Third-Party Materials”), subject to the Parties’ having
obtained any applicable Required Consents in accordance with the Agreement,
Idearc hereby grants to Provider solely to the extent necessary for performing
the Services and to the extent of Idearc’s underlying rights, the same rights
to Use as Idearc possesses under the applicable licenses with respect to such
Idearc Third-Party Materials.  Provider
shall comply with the obligations, including restrictions on Use of such
Materials and those of nondisclosure, imposed on Idearc by the licenses for
such Idearc Third-Party Materials. 
Provider shall cease all Use of such Idearc Third-Party Materials upon
termination or expiration of the Agreement. 
If requested by Idearc, Provider shall certify in writing such cessation
to Idearc.  Provider’s use of such Idearc
Third-Party Materials shall be subject to Sections 4.9 and 5.7(d).


 


(ii)           Provider shall provide Idearc with
all data that Provider possesses or otherwise collects in connection with its
performance of the Services that is (1) related to Idearc’s and Provider’s
Use of Idearc Third-Party Materials and (2) required by Idearc to ensure
its compliance with the terms of such licenses.


 


(iii)          THE IDEARC THIRD-PARTY MATERIALS ARE
PROVIDED TO PROVIDER ON AN AS-IS, WHERE-IS BASIS WITH NO WARRANTIES
WHATSOEVER.  IDEARC EXPRESSLY DISCLAIMS
ANY REPRESENTATIONS AND WARRANTIES, EXPRESS OR IMPLIED, AS TO SUCH IDEARC
THIRD-PARTY MATERIALS, OR THEIR CONDITION OR SUITABILITY FOR USE BY PROVIDER,
INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.  THE PARTIES ACKNOWLEDGE AND
AGREE THAT THE FOREGOING DISCLAIMER SHALL NOT BE CONSTRUED TO LIMIT THE RELIEF
OR OTHERWISE THE INTENT OF SECTION 4.9 OR 5.7(d).


 


(b)           Provider Third-Party Materials.


 


(i)            Prior to introducing any Third-Party
Materials licensed to Provider (“Provider Third-Party Materials”) for use in providing the
Services, Provider shall use Commercially Reasonable Efforts to:


 


58

















 


(A)          obtain the
right to grant Idearc (or its designee), for the sole purpose of providing
services to Idearc and members of the Idearc Group, without additional charge
and upon any expiration or termination of the Agreement (and as further
provided in Section 13.6(c)), a perpetual, worldwide, irrevocable,
fully paid-up, royalty-free, nonexclusive sublicense to Use such Provider
Third-Party Materials and to sublicense third parties to Use such Provider
Third-Party Materials solely for the purpose of providing services similar to
the Services to Idearc and members of the Idearc Group; and


 


(B)           verify
that Idearc (or its designee), for the purpose of providing services to Idearc
and members of the Idearc Group, has the right to purchase ongoing maintenance
and support of such Provider Third-Party Materials on commercially reasonable
terms.


 


(ii)           To the extent that Provider is
unable to obtain the rights set forth in subparagraph (i) above, Provider
shall not introduce such Provider Third-Party Materials for use in providing
Services without Idearc’s prior written consent.  Provider shall provide the Services in
accordance with the Agreement and the Service Levels notwithstanding any
decision by Idearc to withhold its consent. 
Schedule 13.3 sets forth the list of Provider Third Party
Materials that Idearc has provided its written consent for Provider to use in
the performance of Services without being required to obtain or grant the
rights and license to Idearc pursuant to subparagraph (i) above.


 


13.4.        Publishing Product.


 


(a)           Publishing Work Product. The copyrights
and other intellectual property rights in the Publishing Product created by
Provider hereunder, and any and all illustrations, artwork, photographs, video,
audio, text, maps and other advertising and information content created for
such Publishing Product shall be deemed to be the sole and exclusive property of
Idearc and shall constitute “Idearc Materials”. 
Provider shall not include any Provider Materials in the Publishing
Product without the prior written consent of Idearc.  With respect to Provider Materials that are
incorporated into a Publishing Product, Provider shall grant to Idearc (and its
designees) a perpetual, worldwide, irrevocable, fully paid-up, royalty-free,
nonexclusive license to Use such Provider Materials and to sublicense third
parties to Use such Provider Materials solely for the purpose of utilizing the
Publishing Product.  Provider shall
continue to own all Provider Materials and nothing in this Section 13.4
shall be construed to transfer ownership or title to any Provider Materials.


 


(b)           Further Assurances. 
Provider shall execute, or cause to be executed, and deliver,
without additional compensation, (i) such documents and instruments as
Idearc may reasonably request to transfer and assign to Idearc any right, title
or interest Provider or Provider Personnel may have in any such Publishing
Product, and (ii)


 


59

















 


any and all applications
or registrations for patents, copyrights, trademarks and any other instruments
deemed necessary or appropriate for Idearc to secure and enforce such rights.


 


13.5.        General Rights.


 


(a)           Copyright Legends.  Each Party shall reproduce copyright legends
appearing on any portion of Materials that may be owned by the other Party or
third parties.


 


(b)           Residuals. 
Nothing in the Agreement shall restrict any employee or representative
of a Party from using in their respective business the publishing ideas,
concepts or know-how arising from the provision of the Services pursuant to the
Agreement that are retained in the unaided memory of such employee or
representative after performing the obligations of such Party under the
Agreement, except to the extent that such use infringes upon or constitutes an
infringement or misappropriation of, any Intellectual Property rights of a
Party or its Affiliates; provided, however,
that this Section 13.5(b) shall not be deemed to limit either
Party’s obligations under the Agreement with respect to the disclosure or use
of Confidential Information; provided
further that under no circumstances shall either Party disclose any
information that identifies or may be used to identify the other Party to third
parties.  For the avoidance of doubt, the
paragraph (b) does not apply to any of the following:  (i) Idearc Data, (ii) information
concerning the operations, affairs and businesses of Idearc (or its
Affiliates), the financial affairs of Idearc (or its Affiliates) and the
relations of Idearc and its Affiliates with their respective clients, employees
and vendors (including client lists, client information, client account
information and other information regarding the business planning, operations
or marketing activities of Idearc (or its Affiliates) or (iii) any
Confidential Information of Idearc not expressly covered by the first sentence
of this paragraph (b).  An individual’s
memory is unaided if the individual has not intentionally memorized the
publishing ideas, concepts or know-how for the purpose of retaining and
subsequently using or disclosing the same and does not identify the information
as Confidential Information upon recollection.


 


(c)           No Implied Licenses.  Except as expressly specified in the
Agreement, nothing in the Agreement shall be deemed to grant to one Party, by
implication, estoppel or otherwise, license rights, ownership rights or any
other intellectual property rights in any Materials owned by the other Party or
any Affiliate of the other Party.


 


(d)           Incorporated Materials.  Provider shall not incorporate into
Publishing Product any Materials subject to third-party patent, copyright,
trade secret or license rights for which Idearc is not otherwise licensed,
without the prior written consent of Idearc.


 


(e)           Pre-existing Materials.  Notwithstanding anything to the contrary,
nothing in the Agreement shall provide a Party with any ownership rights to the
other Party’s


 


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pre-existing materials or
Intellectual Property, or Materials or Intellectual Property independently
developed outside of the scope of the Agreement.


 


(f)            Developed Software.  The Parties acknowledge and agree that, as of
the Effective Date, the Services do not contemplate Provider performing
software development activities, and any software development activities
requested by Idearc during the Term shall be deemed to be New Services and
subject to the execution of a written amendment to the Agreement providing
customary terms and conditions regarding such activities (e.g.,
ownership by Idearc of the proprietary rights in such software).


 


13.6.        Idearc Rights Upon
Expiration or Termination of Agreement. 
Upon any expiration of the Agreement or termination of the Agreement in
whole or in part, Provider shall provide the following to Idearc:


 


(a)           Idearc Materials and Publishing Product.  With respect to Idearc Materials and
Publishing Product, Provider shall, at no cost to Idearc:


 


(i)            deliver to Idearc all Idearc
Materials and Publishing Product (whether complete or incomplete) and all
copies thereof in the format and medium in use by Provider in connection with
the Services as of the date of such expiration or termination; and


 


(ii)           following confirmation by Idearc
that the copies of the Idearc Materials and Publishing Product delivered by
Provider are acceptable and the satisfactory completion by Provider of any
Termination Assistance Services for which such Materials are required, destroy
or securely erase all other copies of such Idearc Materials and Publishing
Product then in Provider’s possession and cease using such Idearc Materials and
Publishing Product and any information contained therein for any purpose.


 


(b)           Provider Materials.


 


(i)            Unless Idearc has otherwise
consented, Idearc shall not be obligated to pay any license or transfer fees in
connection with its receipt of the licenses and other rights specified in Section 13.4
above.  Provider shall not use any
Provider Materials for which it is unable to offer such license or other rights
without obtaining Idearc’s prior written consent (and absent such consent,
Provider’s use of any Provider Materials shall obligate Provider to provide, at
no additional cost to Idearc, such license and other rights to Idearc, Idearc’s
designees and members of the Idearc Group).


 


(c)           Third-Party Materials.


 


(i)            Subject to Section 6.2(c),
with respect to Provider Third-Party Materials licensed by Provider and used to
provide the Services, Provider hereby grants to Idearc a sublicense (with the
right to grant sublicenses) offering


 


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the same rights and warranties with respect
to such Provider Third-Party Materials available to Provider or its
subcontractors, on the same or substantially similar terms and conditions, for
the benefit and use of Idearc and members of the Idearc Group upon the
expiration or termination of the Agreement with respect to the Services for
which such Provider Third-Party Materials were used; provided, however, that, during the Termination Assistance
Period, Provider may, by mutual agreement of the Parties, substitute one of the
following for such sublicense:


 


(A)          the
assignment to Idearc (or, at Idearc’s election, to its designee) of the
underlying license for such Provider Third-Party Materials; or


 


(B)           the
procurement for Idearc (or, at Idearc’s election, for its designee) of a new
license (with terms at least as favorable as those in the license held by
Provider, its Affiliates, or its or their subcontractors and with the right to
grant sublicenses) to such Provider Third-Party Materials for the benefit or
use of Idearc and members of the Idearc Group; or


 


(C)           the
procurement for Idearc (or, at Idearc’s election, for its designee) of a
license for substitute Third-Party Materials sufficient to perform, without
additional cost, support or resources and at the levels of performance and
efficiency required under the Agreement, the functions of the Provider Third-Party
Materials necessary to enable Idearc or its designee to provide the Services
after expiration or termination of the Agreement.


 


(ii)           In addition, Provider shall deliver
to Idearc a copy of such Provider Third-Party Materials (including source code,
to the extent it has been made available to Provider) and related documentation
and shall use Commercially Reasonable Efforts to cause maintenance, support and
other services to continue to be available to Idearc (to the extent it has been
available to Provider).  Unless Idearc
has otherwise agreed in advance in accordance with Section 6.2(c),
Idearc shall not be obligated to pay any license or transfer fees in connection
with its receipt of the licenses, sublicenses and other rights specified in
this Section 13.6(c). 
Provider shall not use any Provider Third-Party Materials for which it
is unable to offer such license, sublicense or other rights without obtaining
Idearc’s prior written consent (and absent such consent, Provider’s use of any
such Provider Third-Party Materials shall obligate Provider to provide, at no
additional cost to Idearc, such licenses and other rights).


 


(iii)          To the extent Idearc has agreed in
advance to pay any fees in connection with its receipt of such licenses,
sublicenses or other rights, Provider shall, at Idearc’s request, identify the
licensing and sublicensing options available to Idearc and the license or
transfer fees associated with each. 
Provider shall use Commercially Reasonable Efforts to obtain the most


 


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favorable options and the lowest possible
transfer, license, relicense, assignment or termination fees for such Provider
Third-Party Materials.  Provider shall
not commit Idearc to paying any such fees or expenses without obtaining Idearc’s
prior written consent.  If the licensor
offers more than one form of license, Idearc (not Provider) shall select the
form of license to be received by Idearc.


 


(iv)          In any event, Idearc or its designee
shall be obligated to make payments attributable to the licenses, sublicenses
or other rights received by Idearc or its designee for periods following the
later of the expiration or termination of the Agreement or the conclusion of
Termination Assistance Services with respect to the Services for which such
Provider Third-Party Materials were used for the right to receive maintenance
or support related thereto, but only to the extent Provider would have been
obligated to make such payments if it had continued to hold the licenses or sublicenses
in question or Idearc has agreed in advance to make such payments.


 


ARTICLE XIV


AUDIT RIGHTS


 


14.1.        Audit Rights.


 


(a)           Contract Records.  Provider shall maintain reasonably complete
and accurate records of and supporting documentation for all Charges, all
Idearc Data in its possession and all other data and/or information created,
generated, collected, processed or stored by Provider in its performance under
the Agreement (“Contract
Records”).  Provider shall
retain Contract Records in accordance with Idearc’s record retention policy as
it may be modified from time to time and provided to Provider policies as set
forth in the Policies and Procedures Manual or otherwise previously
communicated (in writing or electronically) to Provider.


 


(b)           Financial and Operational Audits.  Provider shall, and shall cause its
subcontractors to, provide to Idearc (and internal and external auditors,
inspectors, regulators and other representatives that Idearc may designate from
time to time, including customers, vendors, licensees and other third parties
to the extent Idearc or members of the Idearc Group are legally or
contractually obligated to submit to audits by such entities, but in all cases,
who are neither competitors of Provider or engaged on a contingent fee basis)
access at reasonable hours to Provider Personnel, to the Service Locations and
to Contract Records and other pertinent information, all to the extent relevant
to Provider’s performance under the Agreement. 
Such access shall be provided for the purpose of performing audits and
inspections to, among other things, (i) verify the accuracy and
completeness of Contract Records, (ii) verify the accuracy and
completeness of Charges and the Pass-Through Expenses, (iii) examine the
financial controls, processes and procedures utilized by Provider in the
performance of the Services, (iv) examine Provider’s performance of any of
its other financial and accounting obligations,


 


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(v) verify the
integrity of Idearc Data (and whether any security breaches have occurred with
respect thereto), (vi) examine the systems that process, store, support
and transmit such data, (vii) examine the Provider Service Locations, (viii) examine
Provider’s compliance with internal controls utilized by Provider in the
performance of the Services (e.g.,
financial and accounting controls, organizational controls, input/output
controls, system modification controls, processing controls, system design
controls, and access controls), (ix) examine Provider’s compliance with
its obligations under the Agreement, including those relating to security,
Disaster Recovery and back-up practices and procedures, (x) verify
Provider’s reported performance against the applicable Service Levels, (xi) examine
Provider’s measurement, monitoring and management tools utilized by Provider in
the performance of the Services, and (xii) enable Idearc and the members of the
Idearc Group to meet applicable legal, regulatory and contractual requirements.


 


(c)           Regulatory Audit.  Idearc and the members of the Idearc Group
are subject to regulation by self-regulatory organizations to which they
belong, governmental bodies and other regulatory authorities under applicable
laws, rules, regulations and contract provisions.  If such a self-regulatory organization,
governmental body or regulatory authority exercises its right to examine or
audit Idearc’s or an Idearc Group member’s books, records, documents or
accounting practices and procedures pursuant to such laws, rules, regulations
or contract provisions, Provider shall provide such cooperation and assistance
as may be reasonably requested by Idearc in responding to such audits or
requests for information.


 


(d)           Reserved.


 


(e)           General Procedures.


 


(i)            Provider shall provide such
cooperation and assistance as may be reasonably requested by Idearc or its
designee in conducting any audit and shall make requested personnel, records
and information available during the Term and thereafter, during the period
specified in Idearc’s records retention policy as set forth in the Policies and
Procedures Manual or otherwise previously communicated (in writing or
electronically) to Provider.


 


(ii)           Notwithstanding any provision of
this Section 14.1 to the contrary (other than required paragraph
(d)), Idearc and its internal and external auditors, inspectors, regulators and
other representatives shall not be given access to (A) the proprietary
information of other Provider customers, (B) Provider locations that are
not related to Idearc, Idearc Confidential Information, Idearc Data, or the
Services, or (C) Provider’s internal costs, except as to the extent such
costs are the basis upon which Idearc is charged (e.g., cost-plus pricing).


 


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(iii)          In performing any audits, Idearc
shall use Commercially Reasonable Efforts to avoid unnecessary disruption of
Provider’s operations and unnecessary interference with Provider’s ability to
perform the Services in accordance with the Service Levels.


 


(iv)          Following any audit, Idearc shall
conduct (in the case of an internal audit), or request its external auditors or
examiners to conduct, an exit conference with Provider to obtain factual
concurrence with issues identified in the review.


 


(v)           Provider shall provide to Idearc
(and its designees) reasonable private workspace in which to perform an audit,
plus access to photocopiers, telephones, facsimile machines, computer hook-ups,
and any other facilities or equipment reasonably requested for the performance
of the audit.


 


(vi)          Provider acknowledges that Idearc
may engage in unannounced physical or electronic audits, inspections and
visitations of Provider Service Locations to monitor compliance with applicable
Laws or if Idearc determines in good faith that Provider is not performing in
compliance with the Agreement.


 


(f)            Provider Internal Audit.  Promptly following Provider’s conclusion of
any internal audit or similar review regarding the Services (including Provider’s
internal control structure, Provider’s financial and accounting controls,
organizational controls, input/output controls, system modification controls,
processing controls, system design controls, and access controls), Provider
shall provide Idearc with copies of those portions of the audit report relevant
thereto.


 


(g)           Audit Response.  Provider and Idearc shall meet to review each
audit report promptly after the issuance thereof.  Provider shall respond to each audit report
in writing within the required response time specified in such report, but in
any event within 30 days after receipt of such report.  Provider and Idearc shall develop and agree
upon an action plan to promptly address and resolve any deficiencies, concerns
or recommendations in such audit report and Provider, at its own expense, shall
undertake remedial action in accordance with such action plan and the dates
specified therein to the extent necessary to comply with Provider’s obligations
under the Agreement.


 


(h)           Provider Noncompliance.  If an audit by a governmental body or
regulatory authority (including a self-regulatory organization to which Idearc
or a member of the Idearc Group belongs) having jurisdiction over Idearc, a
member of the Idearc Group or Provider results in a finding that Provider is
not in compliance with GAAP or other audit requirement or any rule, regulation
or, subject to Section 9.11, any Law relating to the performance of
any of its obligations under the Agreement, Provider shall, at its own expense
and within the time period specified by such auditor, address and resolve the
deficiencies identified by such


 


65

















 


governmental body or
regulatory authority to the extent necessary to comply with Provider’s
obligations under the Agreement.


 


(i)            Audit Costs.  Except as otherwise provided in this
paragraph, each Party will be responsible for its own costs associated with any
audit activity pursuant to this Section 14.1.  If any audit reveals an overcharge by
Provider, Provider shall promptly pay to Idearc the amount of such overcharge,
together with interest from the date of Provider’s receipt of such overcharge
at the at the rate of 1% per month.  If
an audit reveals either (i) an overcharge of more than 5% or (ii) that
Provider failed to report any matter to Idearc that, pursuant to the Agreement,
it was obligated to report, that will result in any fine or other penalty or
that will otherwise require remediation, then Provider shall promptly reimburse
Idearc for the actual cost of such audit (including non-contingent auditors’
fees and expenses) and any damages, fees, fines, or penalties assessed against
or incurred by Idearc as a result thereof.


 


14.2.        SAS 70
Reviews.  Upon Idearc’s request from time to
time, Provider shall provide to Idearc a copy of all reports prepared by or on
behalf of Provider, over the previous 18-month period, regarding Provider’s
enterprise-wide financial or operational controls or risk management practices
to the extent related to Idearc, the members of the Idearc Group or the
Services.  In addition, Provider annually
shall engage an independent auditor of nationally recognized standing to
conduct a Type II SAS 70 Review of Provider’s operating practices and
procedures (including the internal control environment of each Provider Service
Location), related to Idearc, the members of the Idearc Group and the
Services.  On or before August 1 of
each year (or such earlier date that Idearc may reasonably designate upon at
least 60 days’ prior written notice), Provider shall provide Idearc with an
unqualified opinion of such independent auditor with respect to such Type II
SAS 70 Review.  If such opinion (i) concludes
that any control objective has not been met, (ii) identifies one or more
material weaknesses, significant deficiencies or any other deficiencies in such
operating practices and procedures, (iii) determines that such operating
practices and procedures otherwise fail to comply in any material respect with
applicable standards designed to minimize operational and financial risk, or (iv) is
qualified, and, in each such case, such conclusion, determination or
qualification relates to the Services, Provider promptly shall (1) investigate
the results thereof, (2) provide a reasonably detailed report to Idearc
proposing remediation of such failures or deficiencies, (3) implement all
necessary remedial measures to eliminate such failures or deficiencies, and (4) deliver
to Idearc a subsequent unqualified opinion that confirms that such failures or
deficiencies have been remediated and does not identify any other failures or
deficiencies.  Provider shall complete
the foregoing as promptly as practicable but, in any event, no later than the
earlier of (i) 30 days after delivery of such opinion or (ii) the
date specified by Idearc as the date on which Idearc or its officers will need
such opinion to satisfy any disclosure or certification obligations required by
applicable Law.  Any failure by Provider
to timely provide an unqualified opinion that does not confirm the remediation
of such failures and deficiencies and does not identify any other failures or
deficiencies in accordance with the foregoing will be deemed to constitute an
uncurable material breach of the Agreement. 
Provider acknowledges that such opinion


 


66

















 


may be used and relied upon by (i) Idearc,
its officers, its Board of Directors, its internal auditors and independent
auditors, and (ii) any of Idearc’s regulators to the extent required under
applicable Law.  Idearc and Provider
shall share equally in the third-party costs and expenses associated with the
Type II SAS 70 Review; provided, however,
that Provider’s maximum obligation for such third-party costs shall not exceed
$25,000 per calendar year.


 


14.3.        Idearc Internal Control Matters.


 


(a)           Provider
shall be responsible for the establishment and maintenance of the internal
control environment of all Service Locations, including where appropriate
internal control over financial reporting (the “Provider Controls”), as such Provider
Controls relate to Provider’s provision of the Services and as may be expanded
or adjusted from time to time upon reasonable request by Idearc.  In addition, Provider shall provide such
information, certifications and assistance that Idearc and members of the Idearc
Group may reasonably request in connection with (i) their establishment
and maintenance of internal control over financial reporting (including the
integration with the Provider Controls), (ii) their assessment of the
effectiveness of the Provider Controls, (iii) the identification or
remediation of any significant deficiencies or material weaknesses in such
Provider Controls, or (iv) their disclosure and certification obligations
under applicable Law.  Such information,
certifications and assistance may include (1) documentation of the
Provider Controls, (2) evidence of the effectiveness of such Provider
Controls (including their design and operating effectiveness), and (3) evidence
of Provider’s periodic assessment of the Provider Controls.


 


(b)           Provider
promptly shall notify Idearc of the occurrence of any of the following and
shall provide such information, in reasonable detail, to fully inform Idearc
thereof:


 


(i)            Provider becomes aware that it has
breached any of its obligations under the Agreement;


 


(ii)           Provider plans to make, or makes,
any changes to the internal control environment of any Service Location that
has affected, or is reasonably likely to affect, the internal control over
financial reporting of Idearc or any member of the Idearc Group;


 


(iii)          Provider becomes aware of any
determination that a significant deficiency or material weakness exists, or is
reasonably likely to exist, in the design or operation of the internal controls
of any Service Location to the extent related to the Services;


 


(iv)          Provider becomes aware of any
instances of fraud or other illegal acts, whether or not material, committed by
any Provider Personnel in connection with the provision of the Services; or


 


67
















 


(v)           Provider otherwise becomes aware of
any situation related to the activities under the Agreement that has had, or is
reasonably likely to have, any other material adverse impact on the Services or
the impacted business operations of Idearc or any member of the Idearc Group.


 


ARTICLE XV


INSURANCE AND RISK OF
LOSS


 


15.1.        Insurance.


 


(a)           Requirements.  Provider shall (i) keep in full force
and effect and maintain at its sole cost and expense insurance of the kinds and
at the limits specified in Schedule 15.1 and (ii) ensure that its
policies comply with such other requirements as set forth in this Section 15.1.  All insurance must be issued by one or more
insurance carriers, licensed to do business in the state in which work is to be
performed, and that have an A.M. Best rating of A, VII or better.


 


(b)           Endorsements.  Provider’s
insurance policies as required herein shall name Idearc, its Affiliates and the
Idearc Personnel as additional insureds or certificate holders (as applicable)
for any and all liability arising at any time in connection with Provider’s
performance under the Agreement.  All
insurance afforded to Idearc under this Section 15.1 shall be
primary insurance and any other valid insurance existing for Idearc’s benefit
shall be excess of such primary insurance. 
Provider shall obtain such endorsements to its policy or policies of
insurance as are necessary to cause the policy or policies to comply with the
requirements herein.


 


(c)           Certificates.  Prior to Provider providing any Services, and
upon the renewal date of each policy, Provider shall provide Idearc with
certificates of insurance evidencing compliance with this Section 15.1
(including evidence of renewal of insurance) signed by authorized
representatives of the respective carriers for each Contract Year.  Each certificate of insurance shall include a
statement that the issuing company shall not cancel, nonrenew, reduce or
otherwise change the insurance afforded under the above policies unless 30 days’
prior written notice of such cancellation, nonrenewal, reduction or change is
provided to Idearc.


 


(d)           No Implied Limitation.  The obligation of Provider to provide the
insurance specified herein shall not limit or expand (but for the obligation to
provide such coverage) in any way any obligation or liability of Provider
provided elsewhere in the Agreement.  The
rights of Idearc to insurance coverage under policies issued to or for the
benefit of one or more of them independent of the Agreement shall not be
limited by the Agreement.


 


(e)           Other Types and Limits of Insurance.  Idearc reserves the right to require
additional types and limits of insurance, to the extent such coverage is
normally


 


68

















 


maintained by other
suppliers engaged in performing services similar to the Services and is
available to Provider at minimal incremental expense.


 


(f)            Insurance Subrogation.  With respect to insurance coverage to be
provided by Provider pursuant to this Section 15.1, the applicable
insurance policies shall provide that the insurance companies waive all rights
of subrogation against Provider, Idearc, and each of their respective
subsidiaries, Affiliates, officers, directors, and employees.


 


15.2.        Risk of Loss.  Each
Party shall be responsible for risk of loss of, and damage to, any equipment,
software, facilities, or other materials in its possession or under its
control.


 


ARTICLE XVI


INDEMNIFICATION


 


16.1.        Indemnity by Provider. 
Provider shall indemnify, defend and hold harmless Idearc and its
Affiliates and their respective officers, directors, employees, agents,
representatives, successors and assigns from and against any and all Losses due
to third-party claims arising or resulting from any of the following:


 


(a)           the
willful misconduct or negligence of Provider or any Provider Personnel that
causes:


 


(i)            the damage, loss or destruction of
any real or tangible personal property; or


 


(ii)           the death or bodily injury of any
employee, agent, customer, business invitee, business visitor or other
individual;


 


(b)           Provider’s
breach of any of its representation and warranties set forth in Section 11.2;


 


(c)           the
breach by Provider (or any Provider subcontractor) of its obligations with
respect to Idearc Data or Idearc Confidential Information under Article XII;


 


(d)           the
breach of any obligations to be performed on or after the first Tower
Commencement Date by Provider (or any Provider subcontractor) under any of the
Third-Party Software licenses, Equipment leases or Third-Party Contracts with
respect to which (1) Idearc remains a party and (2) Provider has
Financial Responsibility or operational responsibility pursuant to the
Agreement for so long as Provider retains Financial Responsibility or
operational responsibility for such licenses, leases, or contracts;


 


(e)           the
breach by Provider (or any Provider subcontractor) of any of its obligations
under any of the Third-Party Software licenses, Equipment leases or Third-Party
Contracts to which Provider, its Affiliates or its subcontractors are a party
and


 


69

















 


used by Provider or its
subcontractors to provide the Services (including those licenses, leases and
contracts assigned by Idearc to Provider);


 


(f)            Taxes,
together with interest and penalties, assessed or imposed against Idearc or any
member of the Idearc Group for which Provider has financial responsibility
pursuant to Section 10.12;


 


(g)           any
failure by Provider or any Provider subcontractor to comply with Laws for which
it has responsibility pursuant to Section 9.11;


 


(h)           a
Provider Affiliate or subcontractor asserting rights under the Agreement (other
than a claim for indemnification by a Provider Affiliate pursuant to Section 16.2
or 16.3); or


 


(i)            any
aspect of the employment of Provider Personnel or the termination of such
employment, including claims relating to (i) payment or failure to pay any
salary, wages or other compensation due and owing to any Provider Personnel, (ii) payment
or failure to pay any pension or other benefits of any Provider Personnel, (iii) liability
for any social security or other employment taxes, workers’ compensation claims
and premium payments, and contributions applicable to the wages and salaries of
such Provider Personnel, and (iv) wrongful discharge, claims for breach of
express or implied employment contract and claims that Idearc or a member of
the Idearc Group is an employer, co-employer or joint employer of any Provider
Personnel.


 


16.2.        Indemnity by Idearc. 
Idearc shall indemnify, defend and hold harmless Provider and its Affiliates
and their respective officers, directors, employees, agents, representatives,
successors and assigns, from and against any Losses due to third-party claims
arising or resulting from any of the following:


 


(a)           the
damage, loss or destruction of any real or tangible personal property caused by
the negligence or willful misconduct of Idearc or any Idearc Personnel;


 


(b)           the death
or bodily injury of any employee, agent, customer, business invitee, business
visitor or other individual caused by the negligence or willful misconduct of
Idearc;


 


(c)           the
breach of any obligations to be performed prior to the first Tower Commencement
Date by Idearc under any of the Third-Party Software licenses, Equipment leases
or Third-Party Contracts assigned to Provider or for which Provider has
Financial Responsibility or operational responsibility pursuant to the
Agreement (other than obligations with respect to which Provider has agreed to
indemnify Idearc pursuant to Section 16.1(d) or (e));


 


(d)           Idearc’s
breach of its obligations with respect to Provider Confidential Information
under Article XII;


 


70

















 


(e)           Taxes,
together with interest and penalties, assessed or imposed against Provider for
which Idearc has responsibility pursuant to Section 10.12;


 


(f)            any
failure by Idearc to comply with Laws for which it has responsibility pursuant
to Section 9.11; or


 


(g)           any claim
asserting rights under this Agreement, other than as set forth in Section 16.1
or 16.3, initiated by a member of the Idearc Group (other than Idearc)
that uses or receives Services through Idearc by virtue of this Agreement
(consistent with the Parties’ intention that only Idearc will be permitted to
enforce rights under this Agreement against Provider).


 


16.3.        Infringement.


 


(a)           Provider
shall indemnify, defend and hold harmless Idearc and its Affiliates and their
respective officers, directors, employees, agents, representatives, successors
and assigns from and against any and all Losses and threatened Losses arising
from claims by third parties that the Publishing Product, Materials or
Equipment provided or used by or on behalf of Provider pursuant to the
Agreement or the provision of Services by or on behalf of Provider or the
performance of Provider’s other obligations pursuant to the Agreement, (i) infringes
any intellectual property rights, including patents and copyrights, of any
third party, or (ii) constitutes misappropriation or unlawful disclosure
or use of a third party’s trade secrets.


 


(b)           Idearc
shall indemnify, defend and hold harmless Provider, any Provider Affiliates and
their respective officers, directors, employees, agents, representatives,
successors and assigns from and against any and all Losses and threatened
Losses arising from claims by third parties that any Equipment or Materials
provided by Idearc for Provider’s use in providing Services (other than any
Equipment or Materials assigned to Provider by Idearc) or Idearc’s performance
of its obligations pursuant to the Agreement (i) infringes any
intellectual property rights, including patents and copyrights, of any third
party, or (ii) constitutes misappropriation or unlawful disclosure or use
of a third party’s trade secrets.


 


(c)           Notwithstanding
anything to the contrary in the Agreement, neither Party will have any
liability or obligation to the other Party, such other Party’s Affiliates or
any other Entity or individual under paragraph (a) or (b) above to
the extent based upon any of the Infringement Exceptions.


 


(d)           Third Party Equipment
and Materials Indemnification.


 


(i)            In addition, with respect to third
party Equipment and third party Materials provided by or on behalf of Provider
pursuant to the Agreement, Provider covenants that it shall use Commercially
Reasonable Efforts to obtain and provide intellectual property indemnification
for Idearc from the suppliers of such Equipment or Materials.  Unless otherwise approved in advance


 


71

















 


by Idearc, such indemnification shall be (i) comparable
to the intellectual property indemnification provided by Provider to Idearc
under the Agreement, or (ii) the indemnification(s) customarily or
reasonably available in the industry for the same or substantially similar
types of products.


 


(ii)           In addition, with respect to third
party Equipment and third party Materials provided by or on behalf of Idearc
pursuant to the Agreement and obtained or licensed by Idearc prior to the
Effective Date, Idearc covenants that it will, at Provider’s request, enforce
such intellectual property indemnification rights as it has with respect to
such Equipment or third party Materials from the supplier of such Equipment or
Materials for itself and on behalf of Provider. 
With respect to third party Equipment or third party Materials provided
by or on behalf of Idearc pursuant to the Agreement and obtained or licensed by
Idearc following the Effective Date, Idearc covenants that it will undertake
Commercially Reasonable Efforts to obtain and provide intellectual property
indemnification for Provider from the supplier of such third party Equipment or
Third Party Materials that is (1) comparable to the intellectual property
indemnification provided by Idearc to Provider under the Agreement, or (2) the
indemnification(s) customarily or reasonably available in the industry for
the same or substantially similar types of products.


 


(e)           If (1) any
item supplied by Provider that is subject to the indemnity in Section 16.3(a),
or any item supplied by Idearc that is subject to the indemnity in Section 16.3(b) (each
the “Providing Party”
with respect to the items it has supplied) is found, or in the Providing Party’s
reasonable judgment is likely to be found, to infringe upon the Intellectual
Property rights of any third party in any country in which Services are to be
provided or received under the Agreement, or (2) the continued use of such
items is enjoined, then the Providing Party shall, in addition to defending,
indemnifying and holding harmless the other Party (the “Receiving Party”) as
provided in Sections 16.3(a) and 16.3(b) and in
addition to the other rights the Receiving Party may have under the Agreement,
promptly and at its own cost and expense (and where Idearc is the Receiving
Party, in such a manner as to minimize any disruption to the business and
operations of Idearc and members of the Idearc Group) do the following:


 


(i)            Obtain for the Receiving Party the
right to continue using such item, including, as applicable, the procurement of
a license (including a backlicense) for unlicensed or under-licensed Software,
an Upgrade or maintenance;


 


(ii)           If the action in clause (i) cannot
be accomplished with Commercially Reasonable Efforts, modify the items in
question so that it is no longer infringing, provided
that such modification does not materially degrade the performance or quality
of the Services (or where Idearc is the


 


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Receiving Party, materially adversely affect
the intended use of such item by Idearc as contemplated by the Agreement); or


 


(iii)          If the actions in clauses (i) and
(ii) above cannot be accomplished with Commercially Reasonable Efforts,
replace such items with a non-infringing functional equivalent reasonably
acceptable to the Receiving Party, provided
that such replacement does not materially degrade the performance or quality of
the Services (or where Idearc is the Receiving Party, materially adversely
affect the intended use of such item by Idearc as contemplated by the
Agreement);


 


provided, however, that
in the case where Idearc is the Receiving Party, Idearc may in its sole
discretion elect to accept degraded or diminished Services from Provider in
lieu of receiving the benefit of the actions required by the clauses (i), (ii) and
(iii) above.


 


If Idearc accepts degraded or diminished Services in lieu of receiving
the benefit of the actions in clauses (i), (ii) and (iii) above, and
if Provider fails to meet the Service Levels or its other obligations under the
Agreement, then such failure shall be excused if and to the extent such failure
is attributable to the degraded or diminished Services elected to be accepted
by Idearc if (1) Provider notifies, with specificity and in writing,
Idearc prior to its final decision that Provider is not likely to be able,
using Commercially Reasonable Efforts, to meet such specified Service Level or
other obligation under such circumstances; (2) Provider uses Commercially
Reasonable Efforts to identify and consider reasonable alternatives available
to address and avoid the impending performance failure; and (3) Provider
uses Commercially Reasonable Efforts to meet such Service Level or other
obligation notwithstanding Idearc’s election to accept the degraded or
diminished Services.  If, after using
Commercially Reasonable Efforts, options (i), (ii) and (iii) are not
feasible (or if Idearc so elects), the Providing Party shall remove the
infringing items from the Services and equitably adjust the Charges to
adequately reflect such removal.  The
Parties shall also agree on a work-around (implemented at the Providing Party’s
expense) designed to minimize the financial and operational effects of such
removal.


 


16.4.        Indemnification Procedures. 
With respect to third-party claims subject to indemnification under the
Agreement, the following procedures shall apply:


 


(a)           Notice. 
Promptly after receipt by any Entity or individual entitled to
indemnification (under Sections 16.1 through 16.3 or any other
provisions of the Agreement) of notice of the commencement or threatened commencement
of any civil, criminal, administrative, or investigative action or proceeding
involving a claim in respect of which the indemnitee will seek indemnification
hereunder, the indemnitee shall notify the indemnitor of such claim.  No delay or failure to so notify an
indemnitor shall relieve it of its obligations under the Agreement except to
the extent that such indemnitor has suffered actual prejudice by such delay or
failure.  Within 15 days following
receipt of notice from the indemnitee relating


 


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to any claim, but no
later than five days before the date on which any response to a complaint or
summons is due, the indemnitor shall notify the indemnitee that the indemnitor
shall assume control of the defense and settlement of such claim (a “Notice of Assumption”).


 


(b)           Procedure Following Notice of Assumption.  If the indemnitor delivers a Notice of
Assumption within the required notice period, the indemnitor shall assume
control (subject to indemnitee’s right to participate at its own expense) over
the defense and settlement of the claim and diligently defend the claim; provided, however,
that (i) the indemnitor shall keep the indemnitee fully apprised as to the
status of the defense, and (ii) the indemnitor shall obtain the prior
written approval of the indemnitee before entering into any settlement of such
claim asserting any liability against the indemnitee, imposing any obligations
or restrictions on the indemnitee, ceasing to defend against such claim or
otherwise adversely impacting the indemnitee. 
The indemnitor shall not be liable for any legal fees or expenses
incurred by the indemnitee following the delivery of a Notice of Assumption; provided, however, that (i) the
indemnitee shall be entitled to employ counsel at its own expense to
participate in the handling of the claim, and (ii) the indemnitor shall
pay the fees and expenses associated with such counsel if, in the reasonable
judgment of the indemnitee, based on an opinion of counsel, there is a conflict
of interest with respect to such claim or if the indemnitor has requested the
assistance of the indemnitee in the defense of the claim or the indemnitor has
failed to defend the claim diligently. 
The indemnitor shall not be obligated to indemnify the indemnitee for
any amount paid or payable by such indemnitee in the settlement of any claim if
(x) the indemnitor has delivered a timely Notice of Assumption and such
amount was agreed to without the written consent of the indemnitor, (y) the
indemnitee has not provided the indemnitor with notice of such claim and a
reasonable opportunity to respond thereto, or (z) the time period within
which to deliver a Notice of Assumption has not yet expired.


 


(c)           Procedure Where No Notice of Assumption Is Delivered.  If the indemnitor does not deliver a Notice
of Assumption relating to any claim within the required notice period, the
indemnitee shall have the right to defend the claim in such manner as it may
deem appropriate.  The indemnitor shall
promptly reimburse the indemnitee for all reasonable costs and expenses
incurred by indemnitee, including attorneys’ fees, in connection therewith to
the extent it is a claim for which the indemnitor is obligated to indemnify
under the Agreement.


 


16.5.        Subrogation.  Except
as may otherwise be provided in Article XV, if an indemnitor is
obligated to indemnify an indemnitee pursuant to any provision of the
Agreement, the indemnitor shall, upon payment of such indemnity in full, be
subrogated to all rights of the indemnitee with respect to the claims to which
such indemnification relates.


 


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ARTICLE XVII


LIMITATION OF LIABILITY


 


17.1.        General
Intent.  Subject to the
specific provisions and limitations of this Article XVII, it is the
intent of the Parties that each Party shall be liable to the other Party for
any actual damages incurred by the non-breaching Party as a result of the
breaching Party’s failure to perform its obligations in the manner required by
the Agreement.


 


17.2.        Limitation of Liability.


 


(a)           Consequential Damages.  EXCEPT AS PROVIDED IN SECTION 17.2(c),
NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY UNDER OR IN CONNECTION WITH
THE AGREEMENT FOR INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE
DAMAGES, INCLUDING LOST PROFITS, REGARDLESS OF THE FORM OF THE ACTION OR
THE THEORY OF RECOVERY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES, WHETHER BASED UPON AN ACTION OR CLAIM IN CONTRACT, TORT,
WARRANTY, NEGLIGENCE, INTENDED CONDUCT OR OTHERWISE (INCLUDING ANY ACTION OR
CLAIM ARISING FROM THE ACTS OR OMISSIONS, NEGLIGENT OR OTHERWISE, OF THE LIABLE
PARTY).


 


(b)           Direct Damages.  EXCEPT AS PROVIDED IN SECTION 17.2(c),
THE TOTAL AGGREGATE LIABILITY OF EITHER PARTY (FOR ANY AND ALL CLAIMS), FOR
DIRECT DAMAGES UNDER OR IN CONNECTION WITH THE AGREEMENT, REGARDLESS OF THE FORM OF
THE ACTION OR THE THEORY OF RECOVERY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGES, WHETHER BASED UPON AN ACTION OR CLAIM IN
CONTRACT, TORT, WARRANTY, NEGLIGENCE, INTENDED CONDUCT OR OTHERWISE (INCLUDING
ANY ACTION OR CLAIM ARISING FROM THE ACTS OR OMISSIONS, NEGLIGENT OR OTHERWISE,
OF THE LIABLE PARTY), SHALL NOT EXCEED AN AMOUNT EQUAL TO THE TOTAL CHARGES
PAYABLE TO PROVIDER DURING THE EIGHTEEN (18) MONTH PERIOD IMMEDIATELY PRECEDING
THE MOST RECENT EVENT GIVING RISE TO SUCH LIABILITY UNDER THE RELEVANT
STATEMENT OF WORK WHICH GIVES RISE TO SUCH LIABILITY (OR, IF SUCH EVENT OCCURS
WITHIN THE FIRST 18 MONTHS OF THE TERM, AN AMOUNT EQUAL TO $15,000,000).


 


(c)           Exceptions to Exclusions and Limitations of Liability.  The exclusions and limitations of liability
set forth in Section 17.2(a) and Section 17(b), respectively,
shall not apply with respect to (i) Losses resulting from any acts or
omissions of a Party constituting fraud, willful misconduct or gross
negligence; (ii) indemnification obligations of a Party pursuant to Section 16.1,
16.2 or 16.3; (iii) any Abandonment by Provider of the
Agreement; or (iv) Losses resulting from


 


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any breach of a Party’s
obligations under Sections 12.1, 12.2 and 12.3 or Article XIII.


 


(d)           Items Not Considered Damages.  The following shall not be considered damages
subject to, and shall not be counted toward, the liability exclusions or
limitations specified in Section 17.2(a) and Section 17.2(b),
respectively:  (i) Performance
Credits assessed against Provider pursuant to the Agreement; (ii) invoiced
Charges that Idearc is not obligated to pay under the Agreement because such
amounts are attributable to billing errors or for Services not provided in
accordance with the Agreement; (iii) amounts paid by Idearc but
subsequently recovered from Provider due either to incorrect Charges by
Provider or for Services not provided in accordance with the Agreement; or (iv) invoiced
Charges and other amounts that are due and owing to Provider for Services
provided under the Agreement.


 


(e)           Acknowledged Direct Damages.  Without limiting the generality of the provisions
of this Article XVII, the following shall be considered a
non-exclusive list of direct damages and neither Party shall assert that they
constitute indirect, incidental, consequential or special damages or lost
profits to the extent they result directly from either Party’s breach of its
obligations under the Agreement:


 


(i)            costs and expenses incurred for
reconstructing or reloading any lost, stolen or damaged Idearc Data;


 


(ii)           costs and expenses incurred for
implementing and performing a work-around in respect of a failure to provide
the Services or any part thereof in accordance with the Agreement;


 


(iii)          costs and expenses incurred for
replacing lost, stolen or damaged Equipment, Software or Materials;


 


(iv)          cover damages, including the costs
and expenses incurred to procure replacement or corrected services from an
alternate source to provide the Services or corrected services using a Party’s
own internal resources, to the extent in excess of Provider’s applicable
Charges under the Agreement;


 


(v)           overtime, straight time and related
expenses incurred by Idearc, including overhead allocations for employees,
wages and salaries of additional employees, travel expenses, overtime expenses,
telecommunication charges and similar charges, due to Provider’s failure to
provide all or a portion of the Services, incurred in connection with
paragraphs (i) through (iv) above;


 


(vi)          losses of an Affiliate that would be
direct damages if they had instead been suffered by Idearc or Provider;


 


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(vii)                         fines, penalties, interest or other monetary remedies imposed
by a governmental or regulatory body (including self-regulatory body) as a
result of a failure by a Party to comply with requirements that are such Party’s
obligation to pay under Sections 16.1(g) or 16.2(f); and


 


(viii)                      Performance Credits or Milestone Credits assessed against
Provider under the Agreement; and


 


(ix)                              Subject to the limitations set forth in Article IV of Schedule
5.1, the Independent Damages from Provider-Caused Publishing Errors or
Print Anomalies (as defined in Schedule 5.1).


 


(f)                                  Indemnifiable Losses. 
The Parties acknowledge that Losses payable by a Party to a third party
that are the subject of indemnification under the Agreement shall be considered
direct damages under the Agreement.


 


ARTICLE
XVIII

TERMINATION


 


18.1.                      Termination for Cause.


 


(a)                                Idearc may, by giving written notice to
Provider identifying the basis for such notice, terminate the Agreement with
respect to all or any part of the Services, as of the date specified in the
notice of termination, if:


 


(i)                                   Provider fails to complete all Transition Milestones by the
applicable Tower Commencement Date and such failure is not otherwise excused
pursuant to Sections 4.9 or 5.7;


 


(ii)                                Provider commits a material breach of the Agreement, which
breach is not cured within 30 days after receipt from Idearc of written notice
of the breach specifying in reasonable detail the nature of the breach;


 


(iii)                             Provider commits a material breach of the Agreement that is
not capable of being cured within 30 days;


 


(iv)                            Provider commits numerous breaches of the Agreement of which
Provider has received written notice from Idearc that collectively constitute a
material breach of the Agreement;


 


(v)                               Provider incurs Performance Credits, Print Anomaly Credits
and Published Error Credits in an aggregate amount equal to the Annual At-Risk
Amount for any Contract Year;


 


(vi)                            Provider commits a material breach of its obligations
relating to the establishment, maintenance or compliance with any agreed-upon
data security safeguards relating to Idearc Confidential Information;


 


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(vii)                         Provider commits a material breach of its obligations under Section 12.3;


 


(viii)                      Provider experiences a reduction in its long-term credit
rating below BBB, as rated by Standard & Poor’s or Baa as rated by
Moody’s Investor Services or experiences any other event or series of events
that may reasonably evidence a significant degradation in Provider’s long-term
financial condition; or


 


(ix)                              Provider fails to implement the Disaster Recovery and
Business Continuity Plan within the applicable time period in accordance with Section 4.8(b) and
the applicable Transaction Document(s); or, in the absence of a force majeure
event as defined in Section 20.1, the Services are not reinstated
within the specified time period following implementation of the Disaster
Recovery and Business Continuity Plan.


 


(b)                               Provider shall not be entitled to any
Termination Fees in connection with a termination pursuant to this Section 18.1.


 


18.2.                      Termination
for Nonpayment.  If Idearc
fails to pay undisputed Charges owed to Provider when due under the Agreement
aggregating more than an amount equal to one month of Charges, then Provider
may terminate the Agreement after giving Idearc written notice pursuant to Section 21.5
specifically identifying that such notice is given under this Section 18.2
and 45 days to cure.  In the event that
such Charges have not been paid 30 days after the date on which the initial
notice was delivered to Idearc, Provider shall issue a second notice in writing
and addressed to Idearc’s Chief Financial Officer.  Provider acknowledges and agrees that this Section 18.2
describes Provider’s sole right of termination under the Agreement and Provider
hereby waives any other right it might otherwise have to terminate the
Agreement.


 


18.3.                      Termination for Convenience.


 


(a)                                Idearc may terminate the Agreement with
respect to all or any part of the Services, for convenience and without cause
at any time by giving Provider at least three months prior written notice.


 


(b)                               If a purported termination for cause by
Idearc under Section 18.1 is determined by a competent authority
not to constitute a proper termination for cause, then such termination by
Idearc shall be deemed to constitute a termination for convenience under this Section 18.3.


 


18.4.                      Termination
Upon Provider Investment in or Acquisition of Idearc Competitor.  Idearc may, by giving thirty (30) days
written notice to Provider identifying the basis for such notice, terminate the
Agreement with respect to any of the Services as of the date specified in the
notice of termination, if Provider or any of its Affiliates:


 


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(a)                                becomes the Beneficial Owner of a number
of shares of Common Stock of an Idearc Competitor that represents 10% or more
of the aggregate voting power of the outstanding shares of Common Stock of such
Idearc Competitor;


 


(b)                               consummates any merger, consolidation, business
combination or other significant or strategic transaction (or series of related
transactions) with an Idearc Competitor;


 


(c)                                acquires, by purchase, transfer or
conveyance in any one transaction or series of related transactions, assets or
earning power aggregating 10% or more of the assets or earning power of an
Idearc Competitor; or


 


(d)                               executes and delivers any agreement with
an Idearc Competitor providing for the consummation of any of the foregoing
transactions or publicly announces the execution and delivery of any such
agreement.


 


For the avoidance of doubt,
the foregoing provisions of this Section 18.4 will not apply merely
to the execution, delivery or performance of a nonexclusive alliance
arrangement between Provider (or any of its Affiliates) and any Idearc
Competitor to jointly market products or services to customers; provided, further, that the termination right available to
Idearc shall lapse if Idearc fails to exercise its right within 120 days after
Idearc becomes aware of any triggering event under this Section 18.4.  Provider shall not be entitled to any
Termination Fees in connection with a termination pursuant to this Section 18.4.


 


18.5.                      Termination
Upon Provider Change of Control.  In the event of a change in Control of
Provider (or that portion of Provider providing all or any material part of the
Services under the Agreement) or, if Provider is not the ultimate parent
company, Provider’s ultimate parent company, where such Control is acquired,
directly or indirectly, in a single transaction or series of related
transactions, or all or substantially all of the assets of Provider (or that
portion of Provider providing all or any material part of the Services) are
acquired by any Entity that was not previously an Affiliate of Provider, or
Provider (or that portion of Provider providing all or any material part of the
Services) merges with another Entity and does not constitute the surviving
corporation of such merger, then at any time within 12 months after the last to
occur of such events, Idearc may terminate the Agreement with respect to all or
any part of the Services by giving Provider at least 90 days prior written
notice and designating a date upon which such termination shall be effective; provided, however, that if such change in
Control of Provider involves an Idearc Competitor, Idearc may terminate the
Agreement with respect to all or any part of the Services by giving Provider at
least 30 days prior written notice, and Provider shall not permit such Idearc
Competitor to have any access to Idearc Data, Idearc Confidential Information
or any other information about the Idearc account, including discussions with
Provider Personnel regarding specifics relating to the Services.  Provider shall not be entitled to any
Termination Fees in connection with a termination pursuant to this Section 18.5.


 


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18.6.                      Termination
Upon Idearc Change of Control.  In the event of a change in Control of Idearc
or Idearc’s ultimate parent company, where such Control is acquired directly or
indirectly, in a single transaction or series of related transactions, or all
or substantially all of the assets of Idearc are acquired by any Entity that
was not previously an Affiliate of Idearc, or Idearc merges with another Entity
and does not constitute the surviving corporation of such merger, then at any
time within 12 months after the last to occur of such events, Idearc may
terminate the Agreement with respect to all or any part of the Services by
giving Provider at least 30 days prior written notice and designating a date
upon which such termination shall be effective. 
Idearc shall pay the Termination Fee as set forth in Schedule 18.10
for a termination in accordance with this Section 18.6.


 


18.7.                      Termination
for Change in Law.  If (i) any
one or more changes in Law under Section 9.11 or (ii) any one
or more changes in Law that result in the imposition of any Services Taxes that
are the responsibility of Idearc under Section 10.12, in each case
which would not have been borne by Idearc had Idearc performed the Services
itself, result in a cumulative increase of 10% or more in the aggregate of the
average monthly Charges and the amount of Idearc’s retained responsibility for
Service Taxes under the Agreement from the average monthly Charges and retained
responsibility for Service Taxes in effect as of the Effective Date, then,
unless Provider elects to bear and be responsible for such amounts in excess of
such 10%, Idearc may, after giving 90 days’ written notice specifically
identifying that such notice is given under this Section 18.7,
terminate the Agreement with respect to all or any part of the affected
Services.  Provider shall not be entitled
to any Termination Fees in connection with a termination pursuant to this Section 18.7.


 


18.8.                      Termination
for Provider Insolvency.  If (i) Provider
becomes or is declared insolvent, or is unable to pay its debts as they become
due, (ii) Provider makes an assignment for the benefit of its creditors, (iii) Provider
files, publicly discloses or otherwise notifies Idearc of its intention to
file, a petition under any section or chapter of the United States Bankruptcy
Code, as amended from time to time (the “Bankruptcy Code”), or under any similar law
or statute, (iv) a petition is filed against Provider under any such
statute that is not dismissed within 90 days of it being filed, (v) Provider
is the subject of any bona fide proceedings related to liquidation, insolvency
or the appointment of a receiver or similar officer for all or a substantial
part of Provider’s assets, (vi) Provider enters into an agreement or
arrangement for the composition, extension, or readjustment of all or
substantially all of its obligations or any class of its obligations, or (vii) Provider
experiences an event analogous to any of the foregoing in any jurisdiction in
which any of its assets are situated, then Idearc may terminate the Agreement
as of a date specified in a termination notice. 
Provider shall not be entitled to any Termination Fees in connection
with a termination pursuant to this Section 18.8.


 


18.9.                      Idearc Rights Upon Provider’s Bankruptcy.


 


(a)                                Upon the occurrence of any of the events
described in Section 18.8, in addition to the other rights and
remedies set forth herein, to the maximum extent permitted by Law, Idearc shall
have the immediate right to retain and take possession for safekeeping all
Idearc Confidential Information, Idearc-licensed Third-Party


 


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Software, Idearc-owned Equipment, Idearc Materials,
Idearc-owned Publishing Product, and all other Software, Equipment, Systems or
Materials to which Idearc is or would be entitled upon the expiration or
termination of the Agreement.  Provider
shall cooperate fully with Idearc and assist Idearc in identifying and taking
possession of the items listed in the preceding sentence.  Idearc shall have the right to hold such
Idearc Confidential Information, Software, Equipment, Systems or Materials
until such time as the trustee or receiver in bankruptcy or other appropriate
court officer can provide adequate assurances and evidence to Idearc that they
will be protected from sale, release, inspection, publication, or inclusion in
any publicly accessible record, document, material or filing.  Provider and Idearc agree that without this
material provision, Idearc would not have entered into the Agreement or
provided any right to the possession or use of Idearc Confidential Information,
Software, Equipment, Systems or Materials covered by the Agreement.


 


(b)                               Notwithstanding any other provision of
the Agreement to the contrary, if Provider becomes a debtor under the
Bankruptcy Code and rejects the Agreement pursuant to Section 365 of the
Bankruptcy Code (a “Bankruptcy
Rejection”), (i) any and all of the licensee and
sublicensee rights of Idearc arising under or otherwise set forth in the
Agreement, including the rights of Idearc under Article XIII, shall
be deemed fully retained by and vested in Idearc as protected intellectual
property rights under Section 365(n)(1)(B) of the Bankruptcy Code and
further shall be deemed to exist immediately before the commencement of the
bankruptcy case in which Provider is the debtor; (ii) Idearc shall have
all of the rights afforded to non-debtor licensees and sublicensees under Section 365(n) of
the Bankruptcy Code; and (iii) to the extent any rights of Idearc or the
members of the Idearc Group under the Agreement that arise after the
termination or expiration of the Agreement are determined by a bankruptcy court
to not be “intellectual property rights” for purposes of Section 365(n),
all of such rights shall remain vested in and fully retained by Idearc after
any Bankruptcy Rejection as though the Agreement were terminated or
expired.  Idearc shall under no
circumstances be required to terminate the Agreement after a Bankruptcy
Rejection to enjoy or acquire any of its rights under the Agreement, including
any of the rights of Idearc under Article XIII.


 


18.10.                Termination
Fee.  If Idearc terminates the Agreement
with respect to all or any portion of the Services pursuant to Section 18.3
[Termination for Convenience] or 18.6 [Termination Upon Idearc Change of
Control] then upon the completion of Provider’s provision of all Termination
Assistance Services in accordance with the Agreement, Idearc shall pay Provider
the applicable termination fee as set forth on Table A of Schedule 18.10
(the “Termination Fee”);
provided, however that such amounts will be discounted by 50% in the event of a
termination pursuant to Section 18.6.


 


In addition, in the event of
termination of this Agreement for any reason prior to December 31, 2014
(the expiration of the initial Term), Idearc shall pay those amounts set forth
on Table B of Schedule 18.10 for the applicable date of termination.


 


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18.11.                Partial
Terminations  .  If Idearc terminates the Agreement with
respect to any part of the Services, the Charges and Termination Fees payable
under the Agreement shall be equitably reduced to reflect such partial
termination.  Any such impact on the
pricing caused by the partial termination shall be mutually discussed and
agreed upon by Idearc and Provider.


 


18.12.                Equitable
Remedies.  Provider
acknowledges that, if it breaches (or attempts or threatens to breach) its
obligation to provide Termination Assistance Services pursuant to the
Agreement, its obligation regarding continued performance in accordance with Section 19.2,
its obligations regarding the confidentiality of Idearc Confidential
Information in accordance with Article XII, or its obligation to
provide access to computers or files containing Idearc Data in accordance with Article XII,
Idearc shall be irreparably harmed for which monetary damages would be
difficult/impossible to ascertain or an inadequate remedy and that Idearc,
therefore, shall be entitled, in addition to any other rights and remedies it
may have at law or in equity, to seek injunctive relief enjoining and
restraining Provider from doing or continuing to do any such act and any other
violations or threatened violations of such obligations.


 


18.13.                Termination
Assistance.


 


(a)                                Commencement; Duration; Recipients. 
Commencing
(i) at least six months prior to the expiration of the Agreement (or on
such earlier date as Idearc may request) or (ii) upon delivery of any
notice of termination of the Agreement with respect to all or any part of the
Services, and, in each case, continuing for up to 12 months following the
effective date of such expiration or termination, Provider shall provide Idearc
with the Termination Assistance Services described in this Section 18.13
and Schedule 18.13 (the “Termination Assistance Schedule”).  At Idearc’s request, Provider also shall
provide Termination Assistance Services directly to an Idearc Group member, any
other Entity or individual receiving Services under the Agreement, or an Entity
or individual acquiring control of an Idearc Group member.  Provider shall provide termination assistance
regardless of the reason for the expiration or termination; provided, however, that if any Transaction
Document has been terminated by Provider pursuant to Section 18.2,
then Idearc shall pay Provider (x) all undisputed amounts then due and
payable and (y) monthly, in advance, for Termination Assistance Services.


 


(b)                               Performance.  Provider shall provide all Termination Assistance
Services subject to and in accordance with the Agreement.  Provider shall perform the Termination
Assistance Services with at least the same degree of accuracy, quality, completeness,
timeliness, responsiveness and resource efficiency as it provided and was
required to provide the same or similar Services during the Term.  Provider shall take such action such that the
quality and level of performance of the Services provided by Provider
concurrently with its provision of Termination Assistance Services or following
Provider’s receipt of a notice of termination or non-renewal shall continue to
meet or exceed the Service Levels and shall not be degraded or deficient in any
respect.  To the extent Provider remains
responsible for the provision of Services under an entire Transaction Document
during the


 


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Termination Assistance Period, Service Levels and
related Performance Credits associated with the Services Provider is then
providing will still apply to such Transaction Document during the Termination
Assistance Period.  Further. the
provisions relating to Print Anomaly Credits and Published Error Credits as set
forth in Schedule 5.1 will continue to apply with respect to Provider’s
performance of the Services during the Termination Assistance Period.


 


(c)                                Payment.  Except as provided above, Idearc shall pay Provider
the rates and charges specified in the Agreement for the additional Provider
Personnel or resources required to perform such Termination Assistance
Services.  To the extent rates and
charges for such personnel or resources are not specified in the Agreement,
Idearc shall pay Provider a negotiated fee, which shall not exceed Provider’s
then-current commercial rates as reduced by the same discount from such rates
as reflected in the Charges in effect immediately prior to expiration or
termination of the Agreement.  To the
extent the Termination Assistance Services requested by Idearc can be provided
by Provider using personnel and resources already assigned to Idearc, there
will be no additional charge to Idearc for such Services.  Idearc may temporarily or permanently adjust
the work to be performed by Provider, the schedules associated therewith or the
Service Levels to permit the performance of Termination Assistance Services by
personnel or resources already assigned to Idearc.


 


(d)                               Mitigation. 
Provider shall use Commercially Reasonable Efforts to mitigate the cost
of termination and the Termination Assistance Services, including by using
Commercially Reasonable Efforts to:


 


(i)                                   as promptly as practicable, but in no event earlier than
Idearc’s exercise, or execution of a written waiver, of its rights to hire
Provider Personnel as contemplated in the Termination Assistance Schedule,
redeploy personnel used to provide the Services;


 


(ii)                                terminate contractors in accordance with the terms of their
contracts in such a manner to avoid or to minimize any liability to pay compensation
for early termination; and


 


(iii)                             redeploy any Equipment used to provide the Services that is
not acquired by Idearc.


 


(e)                                Resources. 
Provider shall use Commercially Reasonable Efforts to ensure that, at
all times during the Term, on 30 days’ prior notice, Provider is able to deploy
all necessary resources to assist Idearc with a complete disengagement in
accordance with the Agreement and the Termination Assistance Schedule.


 


18.14.                Extension
of Services.  At Idearc’s
election upon 90 days’ prior written notice, Provider shall provide to Idearc
any or all of the Services being performed by Provider prior to the date of
expiration or termination of the Agreement for up to 15 months following such
date.  To the extent Idearc requests such
Services, Idearc shall pay Provider the Charges


 


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specified
in the Schedule 10.1 that Idearc would have been obligated to pay
Provider for such Services if the Agreement had not yet expired or been
terminated; provided, however, that to the extent
such Services are provided following the initial expiration date of the
then-current Term, the Charges shall be increased annually by 3.5% over the
Charges (and associated rates) effective for the immediately previous year.  To the extent that Idearc requests a portion
(but not all) of the Services included in a particular Charge, the amount to be
paid by Idearc shall be equitably adjusted in proportion to the portion of the
Services included in the applicable Charge that Provider will not be providing
or performing.


 


18.15.                Termination
Assistance to Designees.  If
Idearc designates one or more alternative suppliers to assume Provider’s role
in connection with any expiration or termination of the Agreement with respect
to all or any part of the Services, then Provider shall provide such
Termination Assistance Services to such alternative suppliers, and such
alternative suppliers may exercise, on behalf of Idearc, the rights afforded to
Idearc under the Agreement relating to Termination Assistance Services.  If Idearc appoints a third-party designee to
assume Idearc’s role in relation to any or all of the Termination Assistance
Services, Provider shall provide Termination Assistance Services to such
designee.


 


ARTICLE
XIX

DISPUTE RESOLUTION


 


19.1.                      Informal
Dispute Resolution.  Prior to
the initiation of formal dispute resolution procedures with respect to any
dispute, other than a dispute arising out of the breach of a Party’s
obligations under Article XII or subject to Section 18.12,
the Parties shall first attempt to resolve such dispute informally, as follows:


 


(a)                                Initial Effort. 
The Idearc Program Manager and the Provider Project Executive shall
attempt in good faith to resolve all disputes (other than those arising out of
a breach of a Party’s obligations under Article XII or subject to Section 18.12).  If the Idearc Program Manager and the
Provider Project Executive are unable to resolve a dispute in an amount of time
that either Party deems reasonable under the circumstances, such party may
refer the dispute for resolution to the senior corporate executives specified
in paragraph (b) below upon notice to the other Party.


 


(b)                               Escalation. 
Within five business days of a notice under paragraph (a) above
referring a dispute for resolution by senior corporate executives, the Idearc
Program Manager and the Provider Project Executive will each prepare and
provide to a Provider Vice President and the Idearc executive to whom the
Idearc Program Manager will report, respectively, summaries of the relevant
information and background of the dispute, along with any appropriate
supporting documentation, for their review. 
The designated senior corporate executives will confer as often as they
deem reasonably necessary to gather and furnish to the other all information
with respect to the matter in issue which the parties believe to be appropriate
and germane in connection with its resolution. 
The designated


 


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senior corporate executives shall discuss the problem
and negotiate in good faith in an effort to resolve the dispute without the
necessity of any formal proceeding.  The
specific format for the discussions will be left to the discretion of the designated
senior corporate executives, but may include the preparation of agreed-upon
statements of fact or written statements of position.


 


(c)                                Non-Binding Mediation. 
If jointly elected by the senior corporate executives, the Parties may
refer the dispute to non-binding mediation. 
The Parties shall mutually agree upon a neutral mediator, the location
of mediation, and the attendant procedures of the mediation.


 


(d)                               Provision of
Information.  During the course of negotiations under
paragraph (a), (b) or (c) above, all commercially reasonable requests
made by one Party to another for non-privileged information, reasonably related
to the dispute, will be honored in order that each of the parties may be fully
advised of the other’s position.


 


(e)                                Prerequisite to Formal
Proceedings.  Formal proceedings for the resolution of a
dispute may not be commenced until the earlier of (i) the designated
senior corporate executives under paragraph (b) above concluding in good
faith that amicable resolution through continued negotiation of the matter does
not appear likely; (ii) 90 days after the notice under paragraph (a) above
referring the dispute to designated senior corporate executives; or (iii) the
mediation referenced in paragraph (c) has neither commenced nor been
resolved within 60 days following refusal by the Parties.  The time periods specified in this Section 19.1
shall not be construed to prevent a Party from instituting, and a Party is
authorized to institute, formal proceedings earlier to (A) avoid the
expiration of any applicable limitations period, (B) preserve a superior
position with respect to other creditors, (C) seek immediate injunctive
relief to avoid irreparable harm, or (D) address a claim arising out of
the breach of a Party’s obligations under Article XII or a dispute
subject to Section 18.12. 
The Party filing a pleading seeking immediate injunctive relief, which
is not awarded in substantial part, shall pay all reasonable costs and
attorneys’ fees of the other Party in connection with such pleading.


 


(f)                                  Use of Proposals and
Information.  Proposals and information exchanged during
the informal proceedings described in this Section 19.1 shall be
privileged, confidential and without prejudice to a Party’s legal position in
any formal proceedings.  All such
proposals and information, as well as any conduct during such proceedings,
shall be considered settlement discussions and proposals, and shall be
inadmissible in any subsequent proceedings.


 


19.2.                      Continued Performance.


 


(a)                                General. 
Provider acknowledges that the timely and complete performance of its
obligations pursuant to the Agreement is critical to the business and
operations of Idearc.  Each Party agrees
that it shall, unless otherwise directed by the other Party, continue
performing its obligations under the Agreement while any dispute


 


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is being resolved. 
Without limiting the generality of the foregoing, pending resolution of
any dispute, Provider shall not deny, withdraw, or suspend Provider’s provision
of the Services to Idearc under the Agreement. 
This Section 19.2 shall not operate or be construed as
extending the Term or prohibiting or delaying a Party’s exercise of any right
it may have to terminate the Agreement in accordance with Article XVIII.  For the avoidance of doubt, Provider shall
not withhold any Idearc Data pending the resolution of any dispute.


 


(b)                               Non-Interruption of
Service.  Provider acknowledges and agrees that any
interruption to the Service will cause irreparable harm to Idearc, in which
case an adequate remedy at law would not be available.  Provider expressly acknowledges and agrees
that, pending resolution of any dispute or controversy, it shall not deny,
withdraw, or otherwise restrict Provider’s provision of the Services to Idearc
under the Agreement, except as specifically and expressly agreed in writing by
Idearc and Provider.


 


19.3.                      Binding Arbitration.


 


(a)                                The Parties agree to that any
controversy, claim or dispute based upon, arising out of, or relating to the
Agreement, or the negotiation, validity, execution, interpretation or
performance of the Agreement (including (i) any rights or obligations of
the parties, and (ii) any claim or cause of action based upon, arising out
of, or related to any representation or warranty made in or in connection with
the Agreement or as an inducement to enter into the Agreement) shall be
resolved by binding arbitration.  Such
binding arbitration shall be governed by and resolved exclusively in accordance
with the laws of the State of Texas, without regard to its principles of
conflicts of law which would require or permit the application of the laws of
another jurisdiction.  Subject to the
modifications set forth herein, any arbitration shall be administered by the
Dallas, Texas office of the American Arbitration Association (the “AAA”) in accordance
with its Commercial Arbitration Rules in effect at the time the
arbitration is initiated (the “Rules”).


 


(b)                               The arbitrations shall take place in
Dallas, Texas with a panel of three arbitrators.  Each Party shall in good faith select one
arbitrator.  Such arbitrators shall
select the third panel member, or, if they should fail to agree on the third
member, the third member shall be selected by the AAA.  Subject to Section 19.3(e), the
arbitration panel shall be empowered to render full and complete resolution of
the dispute and shall assess all reasonable attorneys’ fees and costs,
including the costs of the arbitration and the arbitrators’ compensation,
against the losing party.  In the event
the arbitration panel finds that any Party has abused or failed to comply with
the applicable arbitration or discovery provisions in the Agreement or in the
Rules, subject to Section 19.3(e) the panel shall be empowered
to render any sanction that would otherwise be available under the Federal Rules of
Civil Procedure including, but not limited to, rendition of an award for
complete relief (including attorneys’ fees and all arbitration expenses), in
favor of the non-offending Party and against the offending Party.


 


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(c)                                  The arbitrators shall issue a decision in
writing, stating reasons therefor, including both findings of fact and
conclusions of law, and may award any remedy available at law or in equity
(consistent with the terms of this Agreement). 
The arbitrator shall have no power to amend or supplement this Agreement
or reinstate this Agreement, to award damages other than as permitted by this
Agreement, or to fail to follow applicable law. 
Any award rendered by the arbitrator(s) shall be final and binding
on the Parties.  The arbitrator(s) shall
be empowered to recommend the granting of injunctive relief to which the
Parties will agree to be bound until a court of competent jurisdiction enters
an order on the same subject matter.  The
Parties agree not to contest the entry and enforcement of the equitable relief
recommended by the arbitrator(s) when applied for at a court of competent
jurisdiction.  The Parties agree that
judgment upon the award rendered by the arbitrators may be entered in any Court
having jurisdiction thereof in order to obtain compliance therewith.


 


(d)                                 The Parties agree that the expeditious
conclusion of the arbitration is critical to all parties and they direct, and
agree that, the arbitration panel shall so allocate time and impose deadlines
that the complete proceeding from the initial demand for arbitration to the
decision of the panel shall be completed within 180 calendar days.


 


(e)                                  Unless otherwise agreed to by the Parties
in writing or ordered by the arbitration panel, discovery shall be conducted
pursuant to the Federal Rules of Civil Procedure except for the following
limitations:


 


(i)                                    the number of depositions concerning any single or
consolidated arbitration shall be limited to four depositions by each side to
the dispute;


 


(ii)                                 each deposition shall last no more than seven hours and may
commence no earlier than 9:00 a.m. and continue no later than 5:00 p.m.,
as measured at the location of the deposition; and


 


(iii)                              the Parties may exchange up to three sets of requests for
documents, but the documents requested shall be limited so as not to exceed
1000 pages per request unless the Parties agree in writing to increase the
limit or if a greater page limit is ordered by the panel.


 


(f)                                    Other than as set forth herein, the
arbitration panel may not award non-monetary or equitable relief, punitive
damages or any other damages not measured by the prevailing Party’s actual
damages.  This paragraph (f) will
not prevent any Party from exercising its right to pursue equitable remedies in
accordance with Section 19.1(e).  If any dispute or claim between the Parties is subject
to judicial proceedings, each Party expressly waives any right it might have to
demand a jury trial in such proceedings.


 


19.4.                      Governing
Law; Jurisdiction; Venue.  To
the extent that any claim or cause of action (whether in contract or tort) that
may be based upon, arise out of, or relate to the 


 


87

















 


Agreement, or the
negotiation, validity, execution, interpretation or performance of the
Agreement is not subject to the Section 19.3 above (a “Non-Arbitration Claim”),
it will be governed by and resolved exclusively in accordance with the laws of
the State of Texas, without regard to its principles of conflicts of law which
would require or permit the application of the laws of another
jurisdiction.  The Parties hereby
irrevocably submit to the exclusive jurisdiction of the state district and
federal courts located in the State of Texas, Dallas County, for purposes of
any Non-Arbitration Claim, and each party hereby irrevocably agrees that all
Non-Arbitration Claims shall be heard and determined exclusively in the state
district and federal courts of the State of Texas, Dallas County.  The Parties hereby irrevocably waive, to the fullest
extent permitted by applicable law, any objection which they may now or
hereafter have to the laying of venue of any such dispute brought in such court
or any defense of inconvenient forum for the maintenance of such dispute.  Each of the Parties hereto agrees that a
judgment in any such dispute may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law.


 


ARTICLE XX

FORCE MAJEURE


 


20.1.                      Force
Majeure.


 


(a)                                  General. 
Subject to paragraph (d) below, no Party shall be liable for any
default or delay in the performance of any of its obligations under the
Agreement if and to the extent such default or delay is caused, directly or
indirectly, by (i) fire, flood, earthquake, elements of nature or acts of
God; (ii) wars (declared and undeclared), acts of terrorism, sabotage,
riots, civil disorders, rebellions or revolutions; or (iii) acts of any
governmental authority with respect to any of the foregoing, and provided that
such default or delay cannot reasonably be circumvented by the non-performing
Party through the use of commercially reasonable alternate sources, workaround
plans or other commercially reasonable means. 
A strike, lockout or labor dispute involving a Party (or, in the case of
Provider, a subcontractor) and its own personnel shall not excuse Provider from
its obligations hereunder.  In addition,
the refusal of Provider or Provider Personnel to enter a facility that is the
subject of a labor dispute shall excuse Provider from its obligations hereunder
only if and to the extent such refusal is based upon a reasonable fear of harm.


 


(b)                                 Duration and
Notification.  In such event the non-performing Party shall
be excused from further performance or observance of the obligations so
affected for as long as such circumstances prevail and such Party continues to
use Commercially Reasonable Efforts to recommence performance or observance
whenever and to whatever extent possible without delay.  Any Party so prevented, hindered or delayed
in its performance shall, as promptly as practicable under the circumstances,
notify the Party to whom performance is due in person or by telephone (to be
confirmed in writing within one day of such notice) and describe at a
reasonable level of detail the circumstances of the force majeure event, the 


 


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steps being taken to address such force majeure event, and the expected
duration of such force majeure event.


 


(c)                                  Substitute Services;
Termination.  If any event described in paragraph (a) above
substantially prevents, hinders, or delays the performance by Provider or one
of its subcontractors of Services necessary for the performance of critical
Idearc functions for more than 24 hours, Idearc may procure such Services from
an alternative source.  Idearc shall not
be liable to make the payment for the Services Provider is unable to
provide.  If any event described in
paragraph (a) above substantially prevents, hinders or delays the
performance by Provider of critical Idearc functions for more than two days,
Idearc, may terminate the Agreement with respect to the Services so affected,
including, but not limited to, the Transaction Document related to such
Services, without payment of Termination Fees, and the Charges payable
hereunder shall be equitably reduced to reflect such terminated Services.  If any event described in paragraph (a) above
substantially prevents, hinders or delays the performance by Provider of
critical Idearc functions for more than 10 days, Idearc may terminate the
Agreement with respect to all or any part of the Services without the payment
of Termination Fees, and if the Agreement is terminated with respect to only
part of the Services, the Charges payable hereunder shall be equitably reduced.  Provider’s right to additional payments or
increased usage charges as a result of any force majeure occurrence affecting
Provider’s ability to perform shall occur solely pursuant to Section 9.10.


 


(d)                                 Disaster Recovery and
Business Continuity.  In accordance with Section 4.8,
upon the occurrence of a force majeure event, Provider shall implement
promptly, as appropriate, its disaster recovery and business continuity plans
under the Disaster Recovery and Business Continuity Plan.  The occurrence of a force majeure event shall
not relieve Provider of its obligation to implement its disaster recovery and
business continuity plans and provide related Services, unless Provider’s
performance under such disaster recovery and business continuity plans is not
possible as a result of the same force majeure event affecting multiple
continents.


 


(e)                                  Payment Obligation. 
If Provider fails to provide Services in accordance with the Agreement
due to the occurrence of a force majeure event, all amounts payable to Provider
hereunder shall be equitably adjusted in a manner such that Idearc is not
required to pay any amounts for Services that it is not receiving whether from
Provider or from an alternate source at Provider’s expense pursuant to
paragraph (c) above.


 


(f)                                    Allocation of Resources. 
Without limiting Provider’s obligations under the Agreement, whenever a
force majeure event or Disaster causes Provider to allocate limited resources
between or among Provider’s customers and Affiliates, Idearc shall receive at
least the same treatment as similarly situated Provider customers.


 


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ARTICLE
XXI

GENERAL


 


21.1.                      Joint
and Several Liability. 
TCSL, a company organized under the laws of the Republic of India with
offices at TCS House, Raveline Street, 21 DS Marg, Fort Mumbai, Mumbai -
400001, Maharashtra, India, and TCS America, a New York Corporation with its
headquarters located at 101 Park Avenue, New York, New York 10178, each hereby
agrees to have joint and several rights, liabilities and obligations of
Provider arising out of or in connection with this Agreement.  For clarity, the combined obligations and/or
liabilities of TCS America and TCSL shall not exceed the limits or limitations
contained in this Agreement.  Each of
TCSL, TCS America and Idearc acknowledge that Idearc would not have entered
into the Agreement without TCSL’s acceptance of this provision and execution
hereof.  Further, TCSL and TCS America
hereby agree that any amendment, renewal, Transaction Document, consent,
notice, approval or other documents entered into on behalf of the Provider
under or pursuant to this Master Agreement may be signed on behalf of Provider
by TCS America or TCSL or both and any such document signed by either TCS
America or TCSL shall be binding on both TCS America and TCSL.


 


21.2.                      Binding
Nature and Assignment.  The
Agreement shall be binding on the Parties and their respective successors and
permitted assigns.  Neither Party may, or
shall have the power to, assign the Agreement without the prior written consent
of the other, except that Idearc may assign its rights and obligations under
the Agreement, without the approval of Provider, to (i) any of its
Affiliates that expressly assumes Idearc’s obligations and responsibilities
under the Agreement, provided, that Idearc shall remain fully liable for and
shall not be relieved from the full performance of all obligations under the
Agreement, (ii) any Entity that acquires all or substantially all of
Idearc’s assets or Idearc’s successor by way of purchase, merger or
acquisition, or (iii) any entity that results from a
restructuring/conversion of Idearc.  Any
attempted assignment that does not comply with the terms of this Section 21.2
shall be null and void.


 


21.3.                      Entire
Agreement.  This Master
Agreement, including any Schedules, Attachments and Exhibits referred to herein
and attached hereto, the Transaction Documents, including any Schedules,
Attachements and Exhibits referred to therein and attached thereto, the RFP and
the Proposal, each of which is incorporated herein for all purposes,
constitutes the entire agreement between the Parties with respect to the
subject matter hereof.  There are no
agreements, representations, warranties, promises, covenants, commitments or
undertakings with respect to the subject matter hereof other than those
expressly set forth herein.  The
Agreement supersedes all prior agreements, representations, warranties,
promises, covenants, commitments or undertakings, whether written or oral, with
respect to the subject matter hereof.


 


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21.4.                      Amendment;
Waivers.  No amendment, modification,
change, waiver, or discharge of the Agreement (including the Transaction
Documents) shall be valid unless in writing and signed by an authorized representative
of the Party against which such amendment, modification, change, waiver, or
discharge is sought to be enforced.


 


21.5.                      Notices.


 


(a)                                  Any notice, notification, request,
demand, or determination provided by a Party shall be in writing and may be
sent in hard copy using one of the following methods and shall be deemed
delivered upon receipt; (i) by hand, (ii) by a reputable express
courier with a reliable system for tracking delivery, or (iii) by
registered or certified mail, return receipt requested, postage prepaid to the
addresses set forth below:


 


In the case of Idearc:


 


Idearc Media Services—West
Inc.


2200 West Airfield Drive


P.O. Box 619810


DFW Airport, Texas  75261-9810


Attention:  Contract Management


 


With a copy (which shall not
constitute effective notice) to:


 


Idearc Media Services West—Inc.


2200 West Airfield Drive


P.O. Box 619810


DFW Airport, Texas  75261-9810


Attention:  Executive Vice President - General Counsel


 


In the case of Provider:


 


TCS America


101 Park Avenue, 26th Floor


New York, New York  10178


Attention:  Senior Contracts Manager


 


With a copy (which shall not
constitute effective notice) to:


 


Tata Consultancy Services
Limited


TCS House, Raveline Street


21 DS Marg, Fort Mumbai, Mumbai - 400001


Maharashtra, India


Attention:  Deputy General Counsel


 


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(b)                                 A Party may from time to time change its
address or designee for notification purposes by giving the other prior notice
of the new address or designee and the date upon which it shall become
effective.


 


21.6.                      Counterparts.  This Master Agreement and each Transaction
Document may be executed in several counterparts, all of which taken together
shall constitute one single agreement between the Parties hereto.


 


21.7.                      Rules of
Construction.  The article
and section headings and the table of contents used herein are for reference
and convenience only and shall not be considered in the interpretation of this
Master Agreement.  As used in this Master
Agreement, unless otherwise provided to the contrary, (a) all references
to days, months or quarters will be deemed references to calendar days, months
or quarters and (b) any reference to a “Section,” “Article,” “Exhibit” or “Schedule”
will be deemed to refer to a section or article of this Master Agreement or an
exhibit or schedule to this Master Agreement. Unless the context otherwise
requires, as used in this Master Agreement, all terms used in the singular will
be deemed to refer to the plural as well, and vice versa.  The words “hereof,” “herein” and “hereunder”
and words of similar import referring to this Master Agreement refer to this
Master Agreement as a whole and not to any particular provision of this Master
Agreement.  Whenever the words “include,”
“includes” or “including” are used in this Master Agreement, they will be
deemed to be followed by the words “without limitation.”  References in the Agreement to “$” will be
deemed a reference to United States dollars unless otherwise specified.


 


21.8.                      Relationship
of Parties.  Provider,
in furnishing Services to Idearc under the Agreement, is acting as an
independent contractor, and Provider has the sole obligation to supervise,
manage, contract, direct, procure, perform or cause to be performed, all work
to be performed by Provider under the Agreement.  The relationship of the Parties under the
Agreement shall not constitute a partnership or joint venture or fiduciary
relationship for any purpose.  Provider
is not an agent of Idearc and has no right, power or authority, expressly or
impliedly, to represent or bind Idearc as to any matters, except as expressly
authorized in the Agreement.  Idearc is
not an agent of Provider and has no right, power or authority, expressly or
impliedly, to represent or bind Provider as to any matters, except as expressly
authorized in the Agreement.


 


21.9.                      Severability.  If any provision of the Agreement conflicts
with the law under which the Agreement is to be construed or if any such
provision is held invalid or unenforceable by a court with jurisdiction over
the Parties, such provision shall be deemed to be restated to reflect as nearly
as possible the original intentions of the Parties in accordance with
applicable law.  The remaining provisions
of the Agreement and the application of the challenged provision to Persons or
circumstances other than those as to which it is invalid or unenforceable shall
not be affected thereby, and each such provision shall be valid and enforceable
to the full extent permitted by law.


 


21.10.                Consents
and Approval.  Except where
expressly provided as being in the sole discretion of a Party, where agreement,
approval, acceptance, consent, confirmation, notice, assistance, cooperation,
determination, decision or similar action by either Party is 


 


92

















 


required under the
Agreement, such action shall not be unreasonably delayed or withheld.  An approval or consent given by a Party under
the Agreement shall not relieve the other Party from responsibility for
complying with the Agreement, nor shall it be construed as a waiver of any
rights under the Agreement, except as and to the extent otherwise expressly
provided in such approval or consent.


 


21.11.                Waiver
of Default; Cumulative Remedies.  A delay or omission by either Party hereto to
exercise any right or power under the Agreement shall not be construed to be a
waiver thereof.  A waiver by either of
the Parties hereto of any of the covenants to be performed by the other or any
breach thereof shall not be construed to be a waiver of any succeeding breach
thereof or of any other covenant herein contained.  All waivers shall be in writing and signed by
the Party waiving its rights.  Except as
otherwise expressly provided in the Agreement, all remedies provided for in the
Agreement shall be cumulative and in addition to and not in lieu of any other
remedies available to either Party at law, in equity, by contract or
otherwise.  The election by a Party of
any remedy provided for in the Agreement or otherwise available to such Party
shall not preclude such Party from pursuing any other remedies available to
such Party at law, in equity,  by
contract or otherwise.  Without limiting
the generality of the foregoing, any termination of the Agreement with respect
to all or any part of the Services (including any termination by Idearc
pursuant to Section 18.1 or 18.3) shall be with a full
reservation of rights to Idearc, and no such termination shall be deemed the
sole and exclusive remedy of Idearc.


 


21.12.                Survival.  Any provision of the Agreement that are
intended to survive the termination or expiration of the Agreement or that
contemplates performance or observance subsequent to any termination or
expiration of the Agreement shall survive any termination or expiration of the
Agreement and continue in full force and effect.


 


21.13.                Publicity.  Neither Party shall use any of the names,
service marks or trademarks of the other Party or refer to the other Party
directly or indirectly in any media release, public announcement, or public
disclosure relating to the Agreement, including in any promotional, advertising
or marketing materials, or business presentations but excluding internal
announcements or disclosures required to meet legal or regulatory requirements
without the prior consent of the other Party to each such use or release.  In addition, neither Party shall make any
public statement about the Agreement, the Services or their relationship
without the other Party’s prior written approval.


 


21.14.                Export.  The Parties acknowledge that certain Equipment,
Materials and technical data to be provided hereunder and certain transactions
hereunder may be subject to export controls under the laws and regulations of
the United States and other countries. 
No Party shall export or re-export any such items or any direct product
thereof or undertake any transaction in violation of any such laws or
regulations.  To the extent required for
Provider to perform the Services and within Provider’s control, Provider shall
be responsible for, and shall coordinate and oversee, compliance with such
export laws in respect of such items exported or imported hereunder in
connection with Provider’s delivery of the Services.


 


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21.15.                No
Third-Party Beneficiaries.  The
Agreement shall not be deemed to create any rights or causes of action in or on
behalf of any third parties, including any Provider Affiliates (but expressly
including Idearc Affiliates), employees (Provider Personnel or Idearc
Personnel), vendors and customers of a Party, or to create any obligations of a
Party to any such third parties; provided,
however, that the Persons entitled to indemnification pursuant to Article XVI
will be entitled to enforce the provisions thereof.  Idearc may enforce the terms of the Agreement
against any Provider Affiliate performing Services.


 


21.16.                Covenant
Against Pledging.  Without the
prior consent of Idearc, Provider shall not assign, transfer, pledge,
hypothecate or otherwise encumber its rights to receive payments from Idearc
under the Agreement for any reason whatsoever.


 


21.17.                Order of Precedence. 
In the event of any apparent conflicts or inconsistencies between the
provisions of the Master Agreement, the Exhibits, the Transaction Documents,
the Schedules or other attachments to the Agreement and Transaction Documents,
such provisions shall be interpreted so as to make them consistent to the
extent possible, and if such is not possible, the provisions of Section 1.6(c) shall
control.


 


21.18.                Further
Assurances.  Subsequent
to the execution and delivery of the Agreement and without any additional
consideration, each Party shall execute and deliver any further legal
instruments and perform any acts that are or may become reasonably necessary to
effectuate the purposes of the Agreement.


 


21.19.                Liens.  Neither Provider nor any of its
subcontractors shall file, or by its action or inaction permit to be filed, any
mechanics’ or materialmen’s liens on or against any property or realty of
Idearc.  If any such liens arise as a
result of any action or inaction of Provider or any of its subcontractors,
Provider shall obtain a bond to fully satisfy such liens or otherwise remove
such Liens at its sole cost and expense promptly, but in any event within a
period not to exceed 30 days.  If
Provider has not satisfied or removed such liens within the 30-day period,
Idearc may, in its sole discretion, pay the amount of such lien or lien claim
and setoff such amounts from payments due to Provider.


 


21.20.                Covenant
of Good Faith.  Each Party
agrees that, in its respective dealings with the other Party under or in
connection with the Agreement, it shall act in good faith.


 


21.21.                Acknowledgment.  The Parties each acknowledge that the terms
and conditions of the Agreement have been the subject of active and complete
negotiations, and that such terms and conditions should not be construed in
favor of or against any Party by reason of the extent to which any Party or its
professional advisors participated in the preparation of the Agreement.


 


*  *  *  *  *


 


[Signature Page Follows]


 


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IN WITNESS WHEREOF, the Parties have caused this Master Agreement to be
executed by their respective duly authorized representatives to be effective as
of the Effective Date.


 


	
   

  	
  IDEARC MEDIA SERVICES—WEST INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  Printed Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  TATA
  AMERICA INTERNATIONAL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  TATA CONSULTANCY SERVICES
  LIMITED

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
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95
















 


SCHEDULE
1.1


 


DEFINITIONS


 


“AAA”
has the meaning set forth in Section 19.3(a).


 


“Abandonment” means
Provider’s intentional cessation or suspension of, or refusal or failure to
provide, prior to completion a material portion of the Services (including a material
portion of the Termination Assistance Services) and such cessation, suspension,
refusal or failure was not the result of a termination of the Agreement by
Provider in accordance with Section 18.2.


 


“Affiliate” means,
with respect to any Entity or individual, any other Entity that, directly or
indirectly, through one or more intermediaries, Controls, is Controlled by or
is under common Control with such Entity or individual.


 


“Agreement” has the
meaning set forth in Section 1.6.


 


“Annual
At-Risk Amount”


 


“Bankruptcy Code” has
the meaning set forth in Section 18.8.


 


“Bankruptcy Rejection”
has the meaning set forth in Section. 18.9(b).


 


“Benchmark Standard”
has the meaning set forth in Section 10.13(e).


 


“Benchmarker” has the
meaning set forth in Section 10.13(a).


 


“Benchmarking” has the
meaning set forth in Section 10.13(a).


 


An Entity shall be deemed
the “Beneficial Owner”
of, and shall be deemed to “Beneficially Own,” any securities (i) that such
Entity, directly or indirectly is the “beneficial owner” of (as determined
pursuant to Rule 13d-3 and Rule 13d-5 of the General Rules and
Regulations under the Exchange Act); or (ii) that such Entity, directly or
indirectly, has the right or obligation to acquire (whether such right or
obligation is exercisable or effective immediately or only after the passage of
time or the occurrence of an event), pursuant to any agreement or arrangement
or upon the exercise of conversion rights, exchange rights, other rights,
warrants or options, or otherwise.


 


“business day” means any day (as
measured in Central Time) other than a Saturday, Sunday or a day on which the
Federal Reserve Banks are closed.


 


“Cause” means a
material violation of Provider’s generally applicable written employment rules or
policies (including but not limited to a violation of applicable Law in the
course of employment) and specifically excluding, by way of example and without
limitation, performance, redundancy, surplus enrollment, restructuring of
Provider or its operations or other economic-related reasons.


 


1

















 


“Change Analysis” has
the meaning set forth in Section 9.10(c).


 


“Change
Control Procedure” means the procedure set forth in Section 9.10.


 


“Change Control Request”
has the meaning set forth in Section 9.10(a).


 


“Change Order” has the
meaning set forth in Section 9.10(d).


 


“Charges” means the
amounts set forth in Article X and on Schedule 10.1 as
charges for the Services.


 


“Code of Ethics” has
the meaning set forth in Section 8.5(c).


 


“Commercially Reasonable Efforts”
means a prompt and diligent effort, made in a professional and workmanlike
manner, using qualified individuals.


 


“Common Stock” means,
as to any Entity, the shares of common stock or other securities or equity
interests of such Entity of any class or series the holders of which are
entitled to vote generally in the election of directors (or other comparable
managers) of such Entity (excluding any class or series the holders of which
would be entitled so to vote upon the occurrence of any contingency, so long as
such contingency has not occurred).


 


“Competitor
Publishing BPO Services Agreement” has the meaning set forth in Section 4.5(c).


 


“Confidential Information”
has the meaning set forth in Section 12.3(a).


 


“Contract Records” has
the meaning set forth in Section 14.1(a).


 


“Contract Year” means
a calendar year.


 


“Control” (together
with its derivatives) means (i) the legal or Beneficial ownership,
directly or indirectly, of (a) at least 50% of the aggregate of all Common
Stock in an Entity or (b) Common Stock having the right to at least 50% of
the profits of an Entity or, in the event of dissolution, to at least 50% of
the assets of an Entity; (ii) the right to appoint, directly or
indirectly, a majority of the board of directors (or other comparable
managers); or (iii) the right to control, directly or indirectly, the
management or policies of the Entity, whether through the ownership of voting
securities, by contract or otherwise.


 


“Data Privacy Laws”
means Laws relating to data privacy, trans-border data flow or data protection,
including regulations, policies, rules and guidelines of Idearc or self
regulatory organizations governing the collection, use or management of
personally identifiable information.


 


“Derivative Work”
means a work based on one or more preexisting works, including a condensation,
transformation, translation, modification, expansion or adaptation, that, if
prepared without authorization of the owner of the copyright of such
preexisting work, would constitute a copyright infringement under applicable
Law, but excluding the preexisting work.


 


2

















 


Disaster” shall have the meaning set
forth in the final Disaster Recovery and Business Continuity Plan.  To the extent such term remains undefined, “Disaster”
shall mean any incident that causes an adverse event that cannot be managed
within the context of normal operating procedures including interruption,
destruction or other loss or diminishment of operational capacity.


 


“Effective Date” has
the meaning set forth in the preamble to this Master Agreement.


 


“Entity” means any
corporation, partnership, joint venture, trust, limited liability company,
limited liability partnership, association or other organization or entity.


 


“Equipment” means all
computing, networking, communications and related equipment procured, provided,
operated, supported, or used by Provider in connection with the Services,
including (i) mainframe, midrange, server and distributed computing
equipment and associated attachments, features, accessories, peripheral
devices, and cabling; (ii) personal computers, laptop computers and
workstations and associated attachments, features, accessories, peripheral
devices, and cabling; (iii) voice, data, video and wireless
telecommunications and network and monitoring equipment and associated
attachments, features, accessories, peripheral devices, and cabling and (iv) all
documentation and materials related thereto.


 


“Equipment Leases”
means all leasing arrangements whereby Idearc or an Idearc Third-Party
Contractor leases Equipment as of the Tower Commencement Date which will be
used by Provider to perform the Services after such Tower Commencement
Date.  Unless otherwise agreed by the
Parties, Equipment Leases shall include all such leases in use as of the Tower
Commencement Date, those as to which the lease, maintenance and support costs
are included in the Idearc Base Case and all other leases as to which Provider
received notice and/or access prior to the Tower Commencement Date.


 


“Error” has the
meaning set forth in Section 11.3(d).


 


“Exchange Act” means
the Securities Exchange Act of 1934, as amended.


 


“Extraordinary Event”
has the meaning set forth in Section 10.8(a).


 


“Financial Responsibility” means, (i) as
applied to the Parties generally, that such Party shall be responsible for all
financial obligations with respect to the applicable asset, including costs
associated with acquisition or leasing, and refresh and upgrade and, (ii) as
applied to Provider, the obligations described in Section 6.2(a).


 


“Financial Responsibility Matrix”
has the meaning set forth in Section 6.2(a).


 


“GAAP” means generally
accepted accounting standards and generally accepted accounting principles for
the applicable jurisdiction applied on a consistent basis.


 


“General Laws” has the
meaning set forth in Section 9.11(a).


 


“GPI” has the meaning set forth in Schedule
5.1.


 


3

















 


“Idearc” has the
meaning set forth in the preamble to this Master Agreement.


 


“Idearc Competitor”
means the Entities identified in Attachment 1.1-A, together with their
respective Affiliates, successors and assigns. 
Attachment 1.1-A may be modified from time to time in Idearc’s
sole discretion; provided, however,
the number of Entities represented on such Attachment 1.1-A may not
exceed nine.  Idearc, in consultation
with, and subject to agreement by, Provider, may supplement such list to exceed
the allowed nine Entities and identify in writing additional Entities that Idearc
has reasonably and in good faith determined to be a competitor.  Any such designation of an additional Idearc
Competitor will be effective for purposes of the Agreement immediately after
the date Idearc and Provider agree upon such designation.


 


“Idearc Data” means
any data or information of Idearc, any member of the Idearc Group, any Idearc
Personnel, or any Idearc Service Recipient, in each case that is provided to or
obtained by Provider in connection with the negotiation and execution of the
Agreement or the performance of any of its obligations under the Agreement,
with respect to the businesses, customers, operations, facilities, products,
rates, regulatory compliance, competitors, consumer markets, assets,
expenditures, mergers, acquisitions, divestitures, billings, collections,
revenues and finances of Idearc or any member of the Idearc Group.  Idearc Data includes any data or information
created, generated, or pertaining to Idearc, any member of the Idearc Group or
any Idearc Service Recipient that is collected or processed by Provider in the
performance of any of its obligations under the Agreement, including data
processing input and output, service level measurements, asset information,
third-party service and product agreements, contract charges, retained expenses
and Pass-Through Expenses.  Idearc Data
also includes Idearc and Idearc Service Recipient data and information that
resides in or is accessed through Software, Equipment or Systems provided, operated,
supported, or used by Provider in connection with the Services.


 


“Idearc Group” means
Idearc and its Affiliates.


 


“Idearc Laws” has the
meaning set forth in Section 9.11(a).


 


“Idearc Licensed Materials”
has the meaning set forth in Section 13.1(b)(i).


 


“Idearc Materials” has
the meaning set forth in Section 13.1(a).


 


“Idearc Personal Data”
means that portion of Idearc Data which is subject to any Data Privacy Laws.


 


“Idearc Personnel”
means the employees, agents, contractors or representatives of Idearc,
excluding Provider and Provider Personnel.


 


“Idearc Program Manager”
has the meaning set forth in Section 9.2.


 


“Idearc
Retained Functions” means activities, tasks, responsibilities
and functions expressly identified as such in the Transaction Documents.


 


“Idearc Service Locations”
has the meaning set forth in Section 7.1(a).


 


4

















 


“Idearc
Service Recipient” means any person or Entity to which Idearc
provides or for which Idearc serves as a third-party service provider,
including, without limitation, Idearc customers or recipients of Idearc’s
publishing services.


 


“Idearc Site” means
those locations owned, leased or under the control of Idearc or its Affiliates.


 


“Idearc Third-Party Contractors”
means a subcontractor, agent or independent contractor providing services
(other than Provider and its contractors with respect to the provision of the
Services) to Idearc or members of the Idearc Group pursuant to an agreement
between Idearc and such third-party contractor.


 


“Idearc Third-Party Materials”
has the meaning set forth in Section 13.3(a)(i).


 


“Incentive
Pricing Period” has the meaning set forth in Section 4.5(c).


 


“Income Taxes” means
any taxes on or measured by the net income of a Party (including taxes on
capital or net worth that are imposed as an alternative to taxes based on net
or gross income), or any taxes which are in the nature of an excess profits
tax, minimum tax on tax preferences, alternative minimum tax, accumulated
earnings tax, personal holding company tax, capital gains tax or franchise tax
for the privilege of doing business.


 


“Infringement Exceptions”
means that the Party providing the particular representation, warranty,
covenant or indemnity under the Agreement (the “Responsible Party”) shall have
no obligation with respect to any claim under or with respect to such
representation, warranty, covenant or indemnity to the extent such claim
results from:  (i) the other Party’s
combinations of the Responsible Party’s work product, Equipment or Materials
with items not provided, specified or reasonably anticipated by the Responsible
Party where such combination was not within the reasonable contemplation of the
Parties given the intended use of the item; (ii) unauthorized
modifications of Equipment or Materials made by or on behalf of the Responsible
Party; (iii) the Responsible Party’s compliance with specifications or
directions (including with respect to Materials or processes) provided by or on
behalf of the other Party to the extent such specifications or directions are
required to be followed, unless and to the extent the Responsible Party had
knowledge of the infringement or misappropriation associated with compliance
with such specifications or directions and failed to disclose it to the other
Party; (iv) third party Equipment or Third Party Materials, except to the
extent that such infringement or misappropriation arises from the failure of
the Responsible Party to obtain the necessary rights or licenses or Required
Consents for which such Responsible Party is responsible under the Agreement or
to abide by the limitations of the applicable third party Equipment or Third
Party Materials licenses of which such Responsible Party received reasonable
prior notification; or (v) use of Equipment or Materials in other than
their specified operating environment where such use was not within the
reasonable contemplation of the Parties; (vi) the distribution, operation
or use of Software or materials for the benefit of a third party outside of the
other Party’s enterprise where such distribution, operation or use was not
within the reasonable contemplation of the Parties; provided however, the Responsible Party will pass through to
the other Party any representations, warranties, covenants and indemnities
permitted under any applicable third party agreement.


 


5

















 


“Intellectual Property”
means patents and other patent rights (including patent disclosures and
applications and patent divisions, continuations, continuations-in-part,
reissues, and extensions thereof); copyrights and other rights in works of
authorship (including software and including registered and unregistered
copyrights and unpublished works of authorship); moral rights, trade secrets;
know-how; trademarks and service marks (including registered and unregistered);
and all other forms of tangible or intangible work, invention, improvement,
discovery, process, writing, design, model, drawing, photograph, report,
formula, pattern, device, compilation, database or computer program, whether or
not protectable under Title 17 of the U.S. Code and whether or not patentable
or otherwise protectable under Title 35 of the U.S. Code and whether or not
protectable or patentable under similar laws worldwide, that are not conceived
of, prepared, procured, generated or produced, whether or not reduced to
practice.


 


“Key Provider Personnel”
means Provider Personnel named or filling the positions designated in each
Transaction Document or Schedule 9.3, as applicable, as Key Provider
Personnel.


 


“KPI”
has the meaning set forth on Schedule 5.1.


 


“Laws” means all
federal, state, provincial and local laws, statutes, ordinances, regulations,
rules, executive orders, supervisory requirements, directives, circulars,
opinions, interpretive letters and other official releases of or by any
government, or any authority, department or agency thereof, including Data
Privacy Laws.  For purposes of the
Agreement, Laws also shall include (i) any rules, regulations, directives,
principles and policies of Idearc or any self-regulatory organizations to which
Idearc or a member of the Idearc Group belong and (ii) GAAP.


 


“Losses” means all
claims and all losses, liabilities, damages, fines, and penalties paid or
payable to or for the benefit of any third party asserting a claim (including
such third party’s successors and assigns) pursuant to any settlement, judgment
or award with respect to such claim (including taxes), and all related costs
and expenses (including reasonable legal fees and disbursements and
out-of-pocket costs of investigation, experts, litigation, settlement,
judgment, interest and penalties).


 


“Malicious Code” means
(i) any code, program, or sub-program whose known or intended purpose is
to damage or interfere with the operation of the computer system containing the
code, program or sub-program, or to halt, disable or interfere with the
operation of the Software, code, program, or sub-program, itself, or (ii) any
device, method, or token that permits any individual to circumvent the normal
security of the Software or the system containing the code; provided, however, that Malicious Code
shall not include any programming code, programming instructions or set of
instructions that is (y) incorporated for purposes of applying a software
patch or (z) distributed as part of Software to ensure that the licensee
uses the product in accordance with the licensing agreement.


 


“Master Agreement” has
the meaning set forth in the Preamble.


 


“Materials” means,
collectively, Software, literary works, other works of authorship,
specifications, designs, analyses, patentable processes, methodologies,
inventions, programs, 


 


6

















 


program
listings, programming tools, documentation, reports, drawings, databases
process and work product, whether tangible or intangible.


 


“Milestone Credits”
has the meaning set forth in Schedule 3.2.


 


“New Entity” has the
meaning set forth in Section 4.4(a).


 


“New Services” has the
meaning set forth in Section 4.6(a).


 


“Non-Arbitration
Claim” has the meaning set forth in Section 19.4.


 


“Notice of Assumption”
has the meaning set forth in Section 16.4(a).


 


“Party” or “Parties” has the
meaning set forth in the preamble to this Master Agreement.


 


“Pass-Through Expenses”
means the expenses, if any, for which Idearc has agreed in advance to be
financially responsible, as set forth in Schedule 10.1.


 


“Peer Group” means (i) the
Entities identified in Attachment 1.1-B, together with their respective
Affiliates, successors and assigns, and (ii) such other Entities that are
generally considered top-tier providers of publishing services.  Attachment 1.1-B may be modified from
time to time in Idearc’s sole discretion; provided, however,
the number of Peer Group Entities represented on such Attachment 1.1-B
may not exceed eleven.  Idearc, in
consultation with, and subject to agreement by, Provider, may supplement such
list to exceed the allowed eleven Entities and identify in writing additional
Entities that Idearc has reasonably and in good faith determined to be a peer
of Provider.  Any such designation of an
additional Peer Group Entity will be effective for purposes of the Agreement
immediately after the date Idearc and Provider agree upon such designation.


 


“Performance Credits”
has the meaning set forth in Schedule 5.1.


 


“Policies and Procedures Manual”
has the meaning set forth in Section 9.6(a).


 


“Pre-Transition
Phase” has the meaning set forth in Schedule 3.2.


 


“Processing
Norms” has the meaning set forth in Section 4.10.


 


“Productivity”
has the meaning set forth in Schedule 10.1.


 


“Proposal” means
Provider’s proposal submitted to Idearc in response to the RFP, as well as any
revised submissions, correspondence and other written communications from
Provider to Idearc in connection with the RFP. 
In the event of a conflict between or among the various documents that
may comprise the Proposal, the more recent provisions shall take precedence
over earlier provisions.


 


“Provider” has the
meaning set forth in the preamble to this Master Agreement.


 


“Provider Controls”
has the meaning set forth in Section 14.3(a).


 


7
















 


“Provider Group” has
the meaning set forth in Section 4.8(c).


 


“Provider Materials” has the
meaning set forth in Section 13.2(a).


 


“Provider Personnel”
means those employees, representatives, contractors, subcontractors and agents
of Provider and Provider Affiliates (and their subcontractors) who perform any
Services under the Agreement.


 


“Provider Project Executive”
has the meaning set forth in Section 9.1.


 


“Provider Service Locations”
has the meaning set forth in Section 7.1(a).


 


“Provider Third-Party Materials”
has the meaning set forth in Section 13.3(b)(i).


 


“Publishing
BPO Services” has the meaning set forth in Section 4.5(c).


 


“Publishing Product”
means all written or creative work produced by Provider, on any media, that is
directly commissioned by Idearc in connection with the Services; provided,
however, that “Publishing Product” shall not refer to software or code.


 


“Quality Assurance”
means the actions, planned and performed, to provide confidence that all
Systems, Equipment, Software and other components of the Services that
influence the quality of the Services are working as expected individually and
collectively.


 


“Ramp-Up
Period”


 


“Reports” has the
meaning set forth in Section 9.7.


 


“Required Consents”
means the consents, if any, required to be obtained (i) to assign or
transfer to Provider the Idearc Third-Party Software, Third-Party Contracts or
Equipment Leases required to be assigned or transferred pursuant to Article VI;
(ii) to grant Provider the right to use and/or access the Idearc Third-Party
Software for provision of the Services; (iii) to grant Idearc and the
members of the Idearc Group the right to use and/or access Provider Materials,
Provider Third-Party Software and Equipment acquired, operated, supported or
used by Provider in connection with providing the Services; (iv) to assign
or transfer to Idearc, the members of the Idearc Group or their designees the
rights in Publishing Product set forth in Article XIII, (v) to
assign or transfer to Idearc or its designee Provider Materials that are
Software, Provider Third-Party Software, Third-Party Contracts, Equipment
Leases or other rights upon expiration or termination of the Agreement to the
extent provided in the Agreement; and (vi) all other consents required
from third parties in connection with Provider’s provision of the Services.


 


“RFP” has the meaning
set forth in the Preamble.


 


“Rules”
as the meaning set forth in Section 19.3(a).


 


“Service Change” has
the meaning set forth in Section 9.10(a).


 


“Service Level Default”
has the meaning set forth in Schedule 5.1.


 


8

















 


“Service Levels” has
the meaning set forth in Section 5.1.


 


“Service Locations”
has the meaning set forth in Section 7.1(a).


 


“Service Taxes” means
all sales, lease, service, value-added, use, excise, consumption, and other
taxes or duties that are assessed against either Party on the provision of the
Services as a whole, or on any particular Service received by Idearc or the
members of the Idearc Group from Provider, excluding Income Taxes.


 


“Services” has the
meaning set forth in Section 4.1.


 


“Software” means all
computer programs and programming for which a Party is financially or
operationally responsible under the Agreement (and all modifications,
replacements, Upgrades, enhancements, documentation, materials and media
related thereto), including applications, development tools, and Systems
Software.


 


“Special
Incentive Discount” has the meaning set forth in Section 4.5(c).


 


“Specifications”
means, with respect to Software, Equipment, Systems or other contract
deliverables to be designed, developed, delivered, integrated, installed and/or
tested by Provider, the technical, design and/or functional specifications, as
applicable, (i) agreed by the Parties, (ii) set forth in third party
vendor documentation, or (iii) set forth in any Idearc request for New
Services.


 


“Statement of Work”
and “Statements of Work”
have the meanings set forth in Section 4.1(a).


 


“System” means an
interconnected grouping of manual or electronic processes, including Equipment,
Software and associated attachments, features, accessories, peripherals and
cabling, and all additions, modifications, substitutions, Upgrades or
enhancements to such System, to the extent a Party has Financial Responsibility
or operational responsibility under the Agreement for such System or System
components.  System shall include all
Systems in use as of the Tower Commencement Date, all additions, modifications,
substitutions, Upgrades or enhancements to such Systems and all Systems
installed or developed by or for Idearc or Provider following the Tower
Commencement Date.


 


“Systems Software”
means all computer programs and programming (and all modifications,
replacements, Upgrades, enhancements, documentation, materials and media
related thereto) that perform tasks basic to the functioning of the Equipment
and are required to operate the Software or otherwise support the provision of
Services by Provider, including operating systems, systems utilities, data
security software, compilers, performance monitoring and testing tools and
database managers to the extent a Party has Financial Responsibility or
operational responsibility for such programs or programming under Schedule
6.2.  Systems Software shall include
all such programs or programming in use as of the Tower Commencement Date,
those as to which the license, maintenance or support costs are included in the
Idearc Base Case and those as to which Provider otherwise received notice
and/or access prior to the Tower Commencement Date.  Systems Software also shall include all such
programs or programming selected and/or developed by or for Idearc, the members
of the Idearc Group or Provider after the 


 


9

















 


Tower
Commencement Date to the extent a Party has Financial Responsibility or
operational responsibility for such programs or programming under Schedule
6.2 .


 


“Targeted
Cost Increases” has the meaning set forth in Section 10.8(d)(i).


 


“Targeted
Cost Reductions” has the meaning set forth in Section 10.8(d)(ii).


 


“Targeted
Resource Additions” has the meaning set forth in Section 10.8(d)(iii).


 


“Targeted
Resource Reductions” has the meaning set forth in Section 10.8(d)(iv).


 


“Technology and Business Process
Evolution” means any improvement, upgrade, supplement,
modification, replacement, or enhancement to the systems, business processes,
hardware, software and network systems interfaces, personnel skills, processes,
functions, business sub-processes and methods used to provide the Services that
are necessary to bring such systems, business processes, hardware, software and
network systems interfaces, personnel skills, processes, functions, business
sub-processes and methods into compliance with the practices and professional standards
then generally followed by the Peer Group or any applicable legal requirements.


 


“Term” has the meaning
set forth in Section 2.1.


 


“Termination Assistance Period”
means the period during which Provider is obligated to provide Termination
Assistance Services as specified in Section 18.13.


 


“Termination Assistance Schedule”
has the meaning set forth in Section 18.13(a).


 


“Termination Assistance Services”
means the termination/expiration assistance requested by Idearc to allow the
Services to continue without interruption or adverse effect and to facilitate
the orderly transfer of the Services to Idearc or its designee, as such
assistance is further described in Section 18.13 and Schedule
18.13.


 


“Termination Fee” has
the meaning set forth in Section 18.10.


 


“Third-Party Contracts”
means all agreements between third parties and either (i) Provider or its
subcontractors or Affiliates or (ii) Idearc and its Affiliates, in each
case that have been or will be used by Provider to provide the Services and
that are identified in Schedule 6.2.


 


“Third-Party Software”
means all Software products (and all modifications, replacements, Upgrades,
enhancements, documentation, materials and media related thereto) and Materials
(i) that are provided under license or lease to Provider or Idearc to the
extent a Party has Financial Responsibility or operational responsibility for
such Software products under Schedule 6.2 and (ii) that are used by
Provider and its subcontractors to provide the Services.  Third-Party Software includes both Idearc
Third-Party Software and Provider Third-Party Software.


 


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“Tower” means the
major service categories comprising the in-scope Services from
time-to-time.  As of the Effective Date,
the Towers are (i) Account Management; (ii) Book Close, (iii) Ad
Production, (iv) Pagination, (v) Listings and (vi) Verticals.


 


“Tower
Commencement
Date” shall mean, for each Transaction Document, the date as the
Parties may agree upon in writing as the date on which Provider will assume
full responsibility for the Services under such Transaction Document (except
for the Transition Services, which will commence on the Effective Date).


 


“Transaction Document”
or “Transaction
Documents” shall have the meaning set forth Section 1.6
of this Master Agreement.


 


“Transactions” has the
meaning set forth in Section 4.4(a).


 


“Transition”
means the process of transferring operational responsibility for the Services
from Idearc to Provider.


 


“Transition Milestones”
the respective dates by which each key activity, or set of key activities, or
key deliverable is to be completed under the Transition Plan.


 


“Transition Period”
means the period that commences on the Effective Date and expires 11:59:59 p.m.,
local time, on the date specified for the applicable Tower as the Tower
Commencement Date as specified in the Transition Plan, unless expressly
extended in writing by Idearc.  For
clarity, each Transition Period is divided between (i) a Pre-Transition
Phase and (2) a Ramp-Up Period.


 


“Transition Plan”
means the description of Transition Services, Transition Milestones, timetables
and deliverables with regard to each Tower set forth on Schedule 3.2.


 


“Transition Services”
has the meaning set forth in Section 3.2(a).


 


“Upgrade” and its
derivatives means updates, renovations, enhancements, additions and/or new
versions or releases of Software or Equipment by Provider.  Unless otherwise agreed, Financial
Responsibility for the costs, fees and expenses associated with an Upgrade of
Software or Equipment shall be allocated between the Parties in accordance with
Article VI.


 


“Use” means to access,
use, execute, copy, display and perform. 
Use shall, where expressly permitted under this Agreement, also mean the
right to modify, enhance, or create Derivative Works.  No rights to source code shall be granted
hereunder unless specifically provided in the Agreement.


 


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