on an ISP
which allows spammers
to operate on that network with the express permission of the ISP
Pink contracts allow an ISP to look pious about prohibiting spam with a strict AUP, while they're secretly raking in the big bucks. For this reason, they are particularly unpopular among anti-spam activists.
PSInet and AT&T are among the major ISPs known to have signed a pink contract with spammers.
Update (9 Nov 2000):
PSInet has since canceled the specific pink contract that made them the focus of attention, but has not said whether any others are in force.