8-KMaterial Agreements

T-Mobile US, Inc. 8-K Report, Material Agreement (Sep 19, 2008)

Filed September 19, 2008For Securities:TMUSTMUSZTMUSITMUSL

Summary

This 8-K filing from MetroPCS Communications, Inc. (the "Company") on September 18, 2008, reports on a material definitive agreement entered into by its subsidiary, MetroPCS Wireless, Inc. ("Wireless"), with Amdocs Software Systems Limited and Amdocs, Inc. ("Amdocs"). The agreement addresses the critical need for a new billing and operational support system, as the Company's current vendor, Verisign, plans to exit the telecommunications services business. The contract with Verisign was set to expire on November 1, 2008, necessitating this proactive measure. The new agreement with Amdocs, effective April 8, 2008, involves licensing billing and operational support software and receiving related services. This includes implementation, operation, support, and maintenance. The primary goal is to facilitate the migration of the Company's subscribers from the existing system to the Amdocs platform. The initial term of the agreement is six years, with renewal options, and includes performance-based pricing and incentives for Amdocs, as well as exclusivity for Amdocs in North America for specific billing functions.

Key Highlights

  • 1MetroPCS Communications, Inc. (the "Company") entered into a material definitive agreement with Amdocs Software Systems Limited and Amdocs, Inc. ("Amdocs").
  • 2The agreement addresses the replacement of the Company's existing billing system, as the current vendor (Verisign) is exiting the telecommunications services business.
  • 3The contract with the former vendor, Verisign, was expiring on November 1, 2008, making this Amdocs agreement a timely necessity.
  • 4The agreement involves Amdocs licensing billing and operational support software to MetroPCS Wireless, Inc. ("Wireless"), and providing implementation, operation, support, and maintenance services.
  • 5The initial term of the agreement is for six years, with provisions for annual renewals.
  • 6Pricing and incentives are contingent on subscriber migration success, meeting deadlines, and the number of subscribers billed, indicating performance-based terms.
  • 7Amdocs will be the exclusive supplier for prepaid, postpaid, and pay-in-advance billing functions and related services in North America, subject to certain exclusions.

Frequently Asked Questions

MetroPCS is entering into this new agreement because its current billing system vendor, Verisign, has announced its intention to leave the telecommunications services business, including billing services. The existing contract was set to expire on November 1, 2008, requiring MetroPCS to secure a new provider.

Amdocs will license its billing and operational support software to MetroPCS Wireless, Inc. They will also provide comprehensive services related to the implementation, operation, support, and maintenance of these systems, as well as transition support to help MetroPCS migrate from its current systems.

The initial term of the agreement is for six years. This term begins upon the successful migration of a specified number of subscribers or by September 30, 2009, whichever comes first. After the initial term, the agreement can automatically renew on an annual basis for up to five one-year renewal terms.

Yes, under the terms of the agreement, Amdocs will be MetroPCS Wireless's exclusive supplier for the prepaid, postpaid, and pay-in-advance billing functions provided by the licensed systems and related services in North America, subject to certain specified exclusions.