E-44
Exhibit No. 22
Form 10-SB
Amendment No. 1
▇▇▇, Inc.
File No. 0-26917
IXC
MASTER SERVICE AGREEMENT
This Agreement for telecommunications services is made as of the
date of last execution below (the " Effective Date") and entered
into by and between IXC Carrier, Inc. / IXC Broadband Services,
Inc. (generically "IXC"), a Nevada/Delaware corporation with its
principal place of business at 5000 Plaza on the Lake, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ("Supplier"), and Buyers United
International, Inc. a Utah corporation with its principal place
of business at ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
("Customer").
WHEREAS, Customer desires to obtain telecommunications services
as described below (the "Service") from Supplier, and Suppliers
is willing to provide the Service for the rates attached hereto.
NOW, THEREFORE, Customer and Supplier hereby mutually agree as
follows:
CREDIT REQUIREMENTS: Letter of Credit. Concurrently with the
execution hereof, Customer has established with Supplier the sum
of one hundred thousand dollars ($100,000.00) (the "Letter of
Credit") (i) upon completion of the first three (3) months
commencing with the Effective Date, Customer shall provide
Supplier with an additional "Letter of Credit" in the amount of
three hundred thousand ($300,000.00); (ii) upon completion of the
fist six (6) months form the Effective Date Customer shall
provide Supplier with an additional "Letter of Credit" in the
amount of seven hundred and fifty thousand ($750,000.00); (iii)
upon completion of the first twelve (12) Months from the
Effective Date Customer shall provide Supplier with an additional
"Letter of Credit" in the amount of three hundred and fifty
thousand ($350,000.00) for a total of $1,500,000.00 (the "Letter
of Credit"), as security for the full and faithful performance of
Customer of the terms, conditions and covenants of this
Agreement. If at any time during the term of the Agreement,
Customer defaults in the payment of any Usage Charges, or any
other amounts payable by Customer to Supplier hereunder, them
Supplier may appropriate and apply any portion of the Letter of
Credit reasonably necessary to remedy any such default. If
during the term of the Agreement, Supplier so applies all or any
portion of the Letter of Credit, then Customer shall restore the
amount of the Letter of Credit so applied by Supplier on or
before the next due payment of Usage Charges under this
Agreement. If however, invoices for Service during any month
provided by Supplier exceed one half of the Letter of Credit, at
the request if Supplier, Customer shall within five (5) days (i)
provide an additional Letter of Credit and/or a cash deposit; or
(ii) other form of security satisfactory to Supplier which in
either case, shall be in an amount equal to the amount by which
the invoice for such month exceeds one-half of the amount of the
Letter of Credit held by Supplier. In addition, if at any time
during the term of this Agreement there is a material and adverse
change in Customer's financial condition or business prospects,
which shall be determined by Supplier in its sole and absolute
discretion, then Supplier may demand that Customer increase the
amount of the Letter of Credit: provided, however, that in no
event shall the amount of the Letter of Credit ever exceed two
months' estimated Usage Charges and other amounts payable by
Customer to Supplier hereunder.
Release of Letter of Credit Notwithstanding anything
to the contrary in above paragraph, at any tie during the term
of the Agreement, Supplier shall release the Latter of Credit to
Customer, in consideration of Customer's undertaking of any of
the following actions: (i) obtaining for the benefit of Supplier
a cash deposit securing the prompt payment, when due, of the
estimated Usage Charges and other amounts due and payable by
Customer to Supplier hereunder any given two-month period; (ii)
(a) granting to Supplier a continuing, floating, first priority
security interest and lien in and to the Collateral (as defined
below) on the terms and subject to the conditions of a
security agreement in form and substance reasonably satisfactory
to Supplier', and (iii) directing all of Customer's End-Users to
deposit any money owed by such End-Users to Customer directly
into a lockbox account at Supplier's bank for the benefit of
Supplier, and authorize Supplier's bank to make automatic
clearing house find transfers from such lockbox account to the
account of Supplier in amounts initially agreed to by Customer
and Supplier, on the tennis and subject to the conditions of art
escrow agreement in form and substance reasonably satisfactory
to Supplier.
SERVICE, TERM AND RATES: Supplier agrees to provide and Customer
agrees to purchase Service(s) indicated below. This agreement,
including any terms and conditions, addenda, schedules,
supplements or exhibits which are attached hereto and
incorporated herein, constitutes the entire agreement (the
"Agreement") by Supplier and Customer pertaining to the subject
matter(s) hereof and supersedes all prior and contemporaneous
agreements and understandings in connection herewith.
Service Type:
Switched Service: Broadband Service:
______X___ Xclusive ________________ ATM
__________ Xnet ________________ Frame Relay
Private Line Service: ________________
Network Management Services
__________ Digital ________________
Training
__________ Optical Customer Interface:
________________ Rack Space &
Power
________________ Shelf Space
________________ Collocation
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date last written below.
IXC Buyers United International, Inc.
By: /s/ By: /s/
Date: December 18, 1997 Date: December 18, 1997
Full Business Address: Full Business Address:
▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇ 635 W. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ 787461050 ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Telephone: 512427-3700 Telephone: 80l-26~90I5
X 1000
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇ Facsimile: 801-68~9254
Master Service Agreement
Terms & Conditions
1. Credit. All Services ordered hereunder are subject to
credit approval. Customer shall complete a credit application
form attached hereto as Exhibit A.
2. Provision of Balance Sheet. Prior to commencement of
Service, Customer shall provide Supplier with financial
statements including a consolidated balance sheet of Customer as
of the end of the most recent quarter and consolidated statements
of income and retained earnings of such quarter and the fiscal
year to date through such quarter, all in reasonable detail and
certified by Customer's chief all in reasonable detail and
certified by Customer's chief financial officer as having been
prepared in accordance with generally accepted accounting
principles, consistently applied. Customer shall provide updated
financial statements as reasonably requested by Supplier.
3. Payment Terms. Invoices for Service are due and payable
within thirty (30) days of the date of invoice (unless otherwise
indicated in the Credit Requirements section of the Master
Service Agreement), without demand or set off by Customer
Payments not received within thirty (30) days of the date of
invoice are considered past due. In addition to Supplier
undertaking any of the actions set forth in this Agreement, if
any invoice is not paid when due: (i) a late charge shall accrue
equal to 1-1/2% ( or maximum legal rate, if less) of the unpaid
balance per month; (ii) Supplier may require a Security Deposit
or other forms of security acceptable to Supplier, and/or (iii)
Supplier may take any action in connection with any other right
or remedy Supplier may have under this Agreement in law or in
equity.
4. Billing Disputes: If Customer in good faith disputes any
portion of any Supplier invoice, Customer shall submit to
Supplier, within 30 days following the date of the invoice, full
payment of the undisputed portion of the invoice and written
documentation identifying and substantiating the disputed amount.
If customer does not report a dispute within the 30 day period,
Customer shall have waived its dispute rights for that invoice.
Supplier and Customer agree to use their respective best efforts
to resolve any dispute within fifteen (15) days after Supplier
and Customer. Any disputed amounts resolved in favor of
Customer shall be credited to Customer's account on the next
invoice following resolution of the dispute. Any disputed
amounts determined to be payable to Supplier shall be due within
ten (10) days of the resolution of the dispute.
Any dispute arising out of or relating to this Agreement which
has not been resolved by the good faith efforts of the parties
will be settled by binding arbitration conducted expeditiously in
accordance with Section 16.
5. Additional Assurances: If at any time during the term of
this Agreement there is a material and adverse change in
Customer's financial contain or business prospects, which shall
be determined by Supplier in its sole and absolute discretion,
then Supplier may demand that Customer deposit with Supplier a
security deposit (the "Security Deposit"), pursuant to Supplier's
standard terms and conditions, as security for the full and
faithful performance of Customer of the terms, conditions and
convenient of this Agreement: provide, however, that in no event
shall the amount of the Security Deposit eve exceed two months'
estimated Usage Charges and other amounts payable by Customer to
Supplier hereunder.
6. Customer hereby represents and warrants that it is certified
to do business in all jurisdictions in which it conducts business
and is in good standing in all such jurisdictions. Customer
further represents and warrants that it is certified by the
proper regulatory agencies to provide interstate, intrastate and
international long distance services to End-Users in those
jurisdictions where such services are to be provided by Customer.
Customer shall keep current during the term of this Agreement,
copies of its Certificates of Public Convenience and Necessity or
similar documents certifying Customer'' interstate, intrastate,
or international operating authority in any local, state, or
federal jurisdiction (collectively, "Service Compliance
Certificates") and furnish copies thereof to Supplier reserves
the right to refuse or withhold Service in any jurisdiction in
which Customer's Service Compliance Certificate has not been
furnished to Supplier in a timely manner. Customer shall defend
and indemnify Supplier form any losses, expenses, demands and
claims in correction with Customer's failure to provide Supplier
with such Service Compliance Certificates. Such indemnification
includes coats and expenses (including reasonable attorney's
fees) incurred by Supplier in settling, defending or appealing
any claims or actions brought against it relating to Customer's
failure to provide such Service Compliance Certificates.
7. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the validity and performance
hereof, shall be governed by the laws of the State of Texas
without regard to its principles of choice of law.
8. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given
as of the date of delivery, facsimile transmission or mailing,
and if mailed, first class postage prepaid, certified or register
mail, return receipt requested to the following persons, unless
contrary instructions are given by the parties in writing:
If to Supplier: IXC
5000 Plaza on the Lake, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Contract Administration
If to Customer: Buyers United International, Inc.
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
9. Waiver of Breach or Violation not Deemed Continuing. The
waiver by either party of a breach or violation of any provision
of this Agreement shall not operate as or be construed to be a
waiver of any subsequent breach hereof.
10. Bankruptcy. In the event of the bankruptcy or insolvency of
either party hereto or if either party hereto shall make an
assignment of the benefit of creditors or take advantage of any
act or law for relief of debtors, the other party to this
Agreement shall have the right to terminate this Agreement
without further obligation or liability on its part.
11. Business Relationship. This Agreement shall not create any
agency, employment, joint venture, partnership, representation,
or fiduciary relationship between the parties. Neither party
shall have the authority to, nor shall any party attempt to,
create any obligation on behalf of the other party.
12. Indemnity. A. Each party shall indemnify, defend, release
and hold harmless the other party and all of its offices, agents,
directors, shareholders, shareholders, subsidiaries, employees
and other affiliates (collectively "Affiliates") form and against
any action, claim, court cost, damage, demand, expense,
liability, loss, penalty, proceeding or suit, (collectively,
together with related attorneys fees; including coats and
disbursements, "Claims") imposed upon either party by reason of
damages to property or injuries, including death, as the result
of an international or a negligent act or omission on the part of
the indemnifying party or any of its affiliates in connection
with: (i) the performance of this Agreement; or (ii) other
activities relation to the property or facilities which are the
subject of this Agreement whether or not the Claims result form a
sole negligent act or omission on the part of both parties, or
whether the Claims result form the negligent act or omission of
the indemnifying party and some other third party. In the event
a Claim related to the negligence of both parties, the relative
burden of the Claim shall be attributed equitably between the
parties in accordance with the principles of comparative
negligence. B. In the event any action shall be brought against
the indemnified party shall immediately notify the indemnifying
party in writing, and the indemnifying party, upon the request of
the indemnified party, shell assume the defense thereof on behalf
of the indemnified party and its Affiliates and shall pay all
expenses and satisfy all judgments which may be incurred by or
rendered against the indemnified party or is Affiliates in
connection therewith, provided that the indemnified party shall
not be liable for any settlement of any such action effected
without its written consent. C. Notwithstanding the termination
of this Agreement for any reason, this Section 12 shall survive
such termination.
13. Insurance. Throughout the term of this Agreement and any
extension thereof, each party shall maintain and, upon written
request, shall provide to the other proof of adequate liability
insurance: (i) Worker's compensation insurance up to the amount
of the statutory limit in the state or states where work is to be
performed; (ii) Employer's liability insurance with a limit of
not less than $200,000 per claim with an all-states endorsement;
(iii) Comprehensive general liability insurance with a limit of
not less than $1,000,000 per occurrence for bodily injury
liability and property damage liability, including coverage
extensions for blanket contractual liability, personal injury
liability and products and completed operations liability; and
(iv) Comprehensive Auto Liability insurance with a limit of not
less than $1,000,000 per accident for Bodily Injury Liability and
Property Damage Liability arising out of the ownership,
maintenance or use of any vehicle in the performance of this
Agreement.
14. Authorized Use of Supplier Name: Without Supplier's prior
written consent, Customer shall not (i) refer to itself as an
authorized representative of Supplier in promotional, advertising
or other materials; or (ii) use Supplier's logos, trade marks,
service marks, or any variations thereof in any of its
promotional, advertising or other materials or in any activity
using or displaying Supplier's name or the Service to be provided
by Supplier. Customer agrees to change or correct, at Customer's
expense, any such material or activity which Supplier, in its
sole judgment, determines to be inaccurate, misleading or
otherwise objectionable in relation to using or marketing
Suppliers services. Customer is explicitly authorized to only
use the following statements in its sales literature: (i)
"Customer utilizes the Supplier's network"; (ii) "Customer
utilizes Supplier's facilities'; (iii) "Supplier provides only
the network facilities"; and (iv) " Supplier is our network
service provider".
15. Assignment. Neither party hereto may assign this Agreement
without the express written consent of the other party hereto,
which consent shall not be unreasonably withheld.
Notwithstanding the foregoing: (i) a security interest in this
Agreement may be granted by Supplier to any lender to secure
borrowings by Supplier or any of its affiliates; (ii) Supplier
may assign all its rights and obligations hereunder to any
Affiliate; and (iii) any subsidiary of Supplier may assign any
amounts due from Customer under any Supplement to Supplier for
billing purposes.
16. Binding Arbitration. The parties will attempt in good faith
to resolve any controversy or claim arising out of or relating to
this Agreement promptly through discussions between themselves at
the operational level. In the event a resolution cannot be
reached, such controversy or claim shall be negotiated between
appointed counsel or senior executives of the parties who have
authority to settle the controversy. The disputing party shall
give the other party written notice of the dispute. If the
parties fail to resolve such controversy or claim within thirty
days of the disputing party's notice, either party may seek
arbitration as set forth below. Any controversy or claim
arising out of or relations to this Agreement, or a breach of
this Agreement, shall be finally settled by arbitration in
Austin, Texas and shall be resolved under there laws of there
State of Texas. The arbitration shall be conducted before a
single arbitrator in accordance with the commercial rules and
practices of the American Arbitration Association then in effect.
The arbitrator shall have the power to order specific performance
if requested. Any award, order, or judgment pursuant to such
arbitration shall be deemed final and binding and may be enforced
in any court of competent jurisdiction. The parties agree that
the arbitrator shall have no power or authority to make awards or
issue orders of any kind except as expressly permitted by this
Agreement, and in no event shall the arbitrator have the
authority to make any award that provides for punitive or
exemplary damages. All such arbitration proceedings hall be
conducted on confidential basis. The arbitrator may, as part of
the arbitration award, permit the substantially prevailing party
to recover all or of part of its attorney's fees and other out-of-
pocket costs incurred in connection with such arbitration.
Customer may, at ifs option, continue to accept what is considers
to be below-standard Services and pay the charges hereunder
relating thereto during such pendency of such arbitration,
without prejudice thereto.
17. Legal Construction. In the event one or more to the
provisions contained in this Agreement shall, for any reason be
held to be invalid, illegal, or unenforceable in any respect,
such invalidity, illegality or unenforceablility shall not affect
any other provision hereof, and this Agreement shall be construed
as if such invalid, illegal or unenforceable provision had never
been contained herein.
18. No Personal Liability. Each action or claim of any party
arising under or relating to this Agreement shall be made only
against the other party as a corporation, and any liability
relating thereto shall be enforceable only against the corporate
assets of such party. No party shall seek to ▇▇▇▇▇▇ the
corporate veil or otherwise seek to impose any liability
relating to, or arising form, this Agreement against any
shareholder, employee, officer or director of the other party.
Each of such persons is an intended beneficiary of the mutual
promises set forth in this Section and shall be entitled to
enforce the obligations of this Section.
19. Notice of Breach of Agreement. To be effective, written
notice of any material breach (except Payment Default) must
prominently contain the following sentences in capital letters:
"THIS IS FORMAL NOTICE OF A BREACH OF CONTRACT. FAILURE TO CURE
SUCH BREACH WILL HAVE SIGNIFICANT LEGAL CONSEQUENCES."
20. Limitation of Liability. Supplier's liability arising out of
delays on restoration of the Services to be preceded under this
Agreement or out of mistakes, accidents, omissions,
interruptions, or errors or defects in transmission in the
provision of Services or any other telecommunications services,
shall be subject to the limitations set for below and in the
applicable Tariff. IN NO EVENT SHALL SUPPLIER BE LIABLE TO
CUSTOMER OR ANY OF THE CUSTOMERS OWN CUSTOMERS OR ANY OTHER THIRD
PARTY IN ANY RESPECT, INCLUDING, WITHOUT LIMITATION, FOR ANY
DAMAGES, EITHER DIRECT, INDIRECT, DAMAGES, CONSEQUENTIAL,
SPECIAL, INCIDENTAL, ACTUAL, PUNITIVE, OR ANY OTHER DAMAGES, OR
FOR ANY LOST PROFITS OF ANY KIND OR NATURE WHATSOEVER, ARISING
OUT OF MISTAKES, ACCIDENTS, ERRORS, OMISSIONS, INTERRUPTIONS, OR
DEFECTS IN TRANSMISSION, OR DELAYS, INCLUDING THOSE WHICH MAY BE
CAUSED BY REGULATORY OR JUDICIAL AUTHORITIES, ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE OBLIGATIONS OF SUPPLIER
PURSUANT TO THIS AGREEMENT; AND IN NO EVENT SHALL SUPPLIER BE
LIABLE AT ANY TIME FOR ANY AMOUNT IN EXCESS OF THE AGGREGATE
AMOUNT IT HAS PRIOR TO SUCH TIME COLLECTED FROM CUSTOMER WITH
RESPECT TO SERVICES DELIVERED HEREUNDER. SUPPLIER MAKES NO
WARRANTY TO CUSTOMER OR ANY OTHER PERSON OR ENTITY, WHETHER
EXPRESS, IMPLIED, OR STATUTORY, AS TO THE DESCRIPTION, QUALITY,
MERCHANTABILITY, COMPLETENESS OT FITNESS FOR ANY PURPOSE OF ANY
SERVICE PROVIDED HEREUNDER OR DESCRIBED HEREIN, OR AS TO ANY
OTHER MATTER, ALL OF WHICH WARRANTIES BY SUPPLIER ARE HEREBY
EXCLUDED AND DISCLAIMED. For purposes of this Section, the term
"Supplier" shall be deemed to include Supplier, its shareholders,
directors, officers and employees, and any person or entity
assisting Supplier in its performance pursuant to this Agreement.
21. System Maintenance. In the event Supplier determined to
interrupt Services for the performance of routine system
maintenance, Supplier will use reasonable efforts to notify
Customer prior to the interruption and to conduct such
maintenance during non-peak hours. In no event shall
interruption for system maintenance constitute a Failure of
Performance by Supplier.
22. Maintenance & Trouble Reporting. Supplier's Standard fees
for Customer maintenance support services are as follows:
Maintenance services shall be defined as all work performed by
Supplier on equipment provided by or on behalf of the Customer,
or supervision of the Customer's work within Supplier's terminal
facilities. Maintenance Service charges are not billed for
troubles found within that portion of a circuit provided by
Supplier. The following billing rates apply for these services:
A. $75 per hour (4 hour minimum-if dispatch is required) Monday
through Friday during the business hours of 8:00 a.m. - 5:00 p.m.
local time, exclusive of the following holidays: New Year's Day,
President's Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and the day after Thanksgiving and Christmas
Day. B. $95 per hour ( 4 hour minimum) for overtime work done
after business hours (defined above) and/or on holidays (defined
above) and/or all day on Saturday and Sundays. C. As requests
for maintenance services are typically made via telephone,
Supplier must be advised in writing as to the person(s) who are
authorized to request service. It is the Customer's
responsibility to keep Supplier apprised of any changes to its
list of representative(s). D. To request technical assistance
and help under the maintenance services, a call must be made to
Supplier's Network Control Center at 1/800/526/2488. This number
should be used for Supplier technical assistance, troubleshooting
or testing of circuits, not for service impairment or outages.
The person calling in must be on the authorized list in order to
commit for charges for this technical assistance. If that person
is not on the list, the request cannot be accommodated. The
Network Control Center personnel will take the call, record the
caller's name and phone number along with facts concerning the
assistance and support needed. The caller will then be given the
number of the " Assistance Ticker." Upon completion of work, this
"Assistance Ticket" will be given to Supplier's Accounting
Department, and the Customer will subsequently be billed based
upon the information on that ticket, A copy will be attached to
the invoice. Except for emergencies, Supplier's technicians
cannot be disputed unless requests are made in accordance with
the above call-out procedure.
23. Subject to Laws. This Agreement is subject to, and Customer
agrees to comply with, all applicable federal, state and local
laws and regulations, ruling and orders of governmental agencies,
including, but not limited to the Communications Act of 1934, the
Telecommunications Act of 1996, the Rules and Regulations of the
Federal Communications Commission ("FCC") and state public
utility or service commissions ("PSC"), tariffs and the obtaining
and continuance of any required certification, permit, license,
approval or authorization of the FCC and PSC or any governmental
body, including, but not limited to regulations applying to
feature group termination and Letter of Agencies ("LOA").
24. FCC Permits, Authorization and Fillings. Supplier shall take
all necessary and appropriate steps, as soon as possible, to
procure form the FCC the necessary authorizations, if any, to
deliver Services hereunder to Customer and whatever approvals are
necessary from any other federal or state agency. In the event
that Supplier cannot obtain all necessary federal, state or local
authority to provide Services hereunder, Supplier shall promptly
give written notice thereof to Customer, and such notice shall
constitute termination without liability of either party hereto
of all obligations hereunder.
25. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, and
when taken together shall constitute one document.
26. Confidential Information and Non-solicitation. "
Confidential Information" shall mean all information disclosed
in writing by one party to the other party which is clearly
marked "CONFIDENTIAL" by the disclosing party at the time of
disclosure. "Confidential Information" shall also include certain
oral information disclosed by one party to the other party,
provided that the disclosing party designates such information as
confidential at the time of disclosure and gives recipient a
written summary of such information within five business days
after the oral disclosure was made. Notwithstanding the
foregoing, all information concerning the traffic
volume/distribution of Supplier, pricing rates, and customer
lists is hereby deemed to be Confidential Information regardless
of whether it is so identified. The term "Confidential
Information" does not include any information which: (i) was
already known by the receiving party free of any obligation to
keep it confidential at the time of its disclosure by the
disclosing party, (ii) becomes publicly known through no wrongful
act of the receiving party, (iii) is rightfully received from a
third person without knowledge of any confidentiality obligation,
(iv) is independently acquired or developed without violating any
of the obligations under this Agreement, (v) is disclosed to a
third person by the disclosing party without similar
confidentiality restrictions on such third persons rights, or
(vi) is approved for release by written authorization of the
disclosing party. Further, the recipient may disclose
Confidential Information Pursuant to any judicial or governmental
request, requirement or order. The recipient, however, shall
take reasonable steps to give the disclosing party sufficient
prior notice to contest such request, requirement or order.
Confidential Information shall remain the property of the
disclosing party, and shall be returned to the disclosing party
or destroyed upon request of the disclosing party. Supplier may
make such Confidential Information available to its lenders.
Accordingly, in event of a breach or threatened breach of the
foregoing provisions, Supplier shall be entitled to an injunction
or restraining order, in addition to such other rights or
remedies as may be available under this Agreement, at law or in
equity, including but not limited to money damages.
27. Force Majeure. Supplier shall not be liable for any failure
of performance hereunder due to causes beyond its reasonable
control, including, but not limited to: acts of God, fire
explosion, vandalism, cable cut, storm or other similar
catastrophes; any law, order, regulation, direction, action or
request of the United Stated government, or of any other
government, including state and local governments having
jurisdiction over either of the parties, or of any department,
agency, commission, court, bureau, corporation or other
instrumentality of any one or more of said governments, or of any
civil or military authority; national emergencies; insurrections;
riots; wars' or strikes, lock outs, work stoppages or other labor
difficulties.
28. Survival. The covenants and agreements of Customer contained
in this Agreement with respect to payment of amounts due,
confidentiality and indemnification shall survive any termination
of this Agreement. The rights and obligations under this
Agreement shall survive any merger or sale of either party and
shall be binding upon the successors and permitted assigns of
each party.
29. Regulatory. Customer is responsible for payment of, or
reimbursement to Supplier for, Universal Service Fund and
Lifeline Assistance Charges ( Presubscribed line charges) set
forth in the National Exchange Carrier Association (NECA) Tariff
FCC #5, sections 8.5., 8.5.2 and 17.14 (A) & (B), as the same may
be amended from time to time or any successor tariffs or
sections, with respect to any Customer ANI's subscribed to
Supplier. In addition, with respect to the Services, Customer is
responsible for payment of, or reimbursement to Supplier for: (i)
telecommunication relay service charges required by the Americans
with Disabilities Act or otherwise (both federal and state); (ii)
interexchange carrier fees payable to the FCC under the Omnibus
Budget Reconciliation Act of 1993 or otherwise; (iii) payphone
service provider compensation as determined by the FCC in CC
Docket No. 96-128; (iv) universal service fund charges,
intraLATA compensation charges; and (v) other federal or state
fees or charges imposed on Supplier. Supplier will furnish, at
Customer's request, documentation to support the fees or charges
payable by Customer to Supplier pursuant to this Section 29.
Customer shall furnish to Supplier valid and Appropriate tax
exemption certificates for all applicable jurisdictions (federal,
state and local) in which it performs customer billing. Customer
is responsible for properly charging tax to its subscribers and
for the proper and timely reporting and payment of applicable
taxes to the taxing authorities and shall defend and indemnify
Supplier form payment and reporting of all applicable federal,
state and local taxes, including, but not limited to, gross
receipts taxes, surcharges, franchise fees, occupational, excise
and other taxes (and penalties and interest thereon), relating to
the Services. Such indemnification includes costs and expenses
(including reasonable attorney's fees) incurred by Supplier in
setting, defending or appealing any claims or actions brought
against it relating to said taxes. If Customer fails to provide
and maintain the required certificates, Supplier may charge
Customer and Customer shall pay such applicable taxes. The
amounts payable by Customer under this Agreement do not include
any state of local sales or use taxes, or utility taxes, however
designated, which may be levied on the goods and services
provided by Supplier hereunder. With respect to such taxes, if
applicable, Customers shall furnish Supplier with an appropriate
exemption certificate or pay to Supplier, upon timely
presentation of invoices therefore, such amounts thereof as
Supplier may be by law required to collect or pay. Any and all
other taxes, including but not limited to franchise, net or gross
income, license, occupation, and real or personal property taxes,
shall be timely paid by Supplier. Customer shall pay to Supplier
any such taxes that Supplier may be required to collect or pay.
30. Obligations Several and Not Joint. Each party shall be
responsible only for its own performance under the Agreement
(including any attachments, exhibits, schedules or addenda) and
not for that of any other party.
31. Amendments. This Agreement may only be modified or
supplemented by an instrument in writing executed by each party.
32. Miscellaneous. Supplier shall not knowingly use information
received form Customer in order to solicit Services to Customer's
End-Users. In addition, within thirty (30) days of receiving
written notice form Customer concerning a potential End-User of
Customer. Notwithstanding the foregoing in the event of a
"Customer Default" as set forth in Section 9. Of the Xclusive
Services Supplement, this Section 32 shall not apply.
IXC Switched Service Supplement
Xclusive Services
1. Scope. Supplier is authorized: (i) to use its best efforts
(considering the needs of its other customers) to start
provisioning of Services (such services, together with the use of
the IXC Online Software, are referred to as the "Services") to
Customer on or before the Service Commencement Date, which is
scheduled to be the first date of order activation; and (ii) to
act as Customer's agent in placing orders with other carriers in
order to provide telecommunications services, if requested. Usage
charges ("Usage Charges") hereunder shall be based on: (i) the
rates for Services set forth in Exhibit A, as applicable; and
(ii) actual usage of Supplier's network from establishment of a
connection between the calling telephone and the called telephone
to termination, as determined by Supplier.
2. Term. This Agreement is for a term of three (3) years
commencing on the Effective Date, unless extended or earlier
terminated pursuant to its terms. This Agreement shall be
automatically extended at the expiration of the initial term on a
month-to-month basis at Supplier's then current month-to-month
rates unless: (i) earlier terminated; or (ii) written notice is
given by either party at least thirty (30) days before such
expiration that such party does not consent to such extension.
3. Customer Responsibilities.
A. General Duties. Customer shall use its best efforts to
solicit and market the Services in accordance herewith and with
applicable law. Customer shall at all times conduct its efforts
in a commercially reasonable and ethical manner. Customer shall
pay all its expenses in connection with its business and its
performance hereunder. Customer shall provide its own billing and
customer service to its customers ("End-Users"). Customer shall
obtain a letter of agency ("LOA") from each End-User in
compliance with applicable Federal Communications Commission
("FCC") and state regulations, however, Customer must obtain a
signed LOA from each End-User utilizing 300 service. Customer
shall retain the signed LOA's and promptly make originals
available upon request of Supplier, any local exchange carrier
("LEC") or any regulatory agency. Customer shall be responsible
for LEC Primary Interexchange Carrier change charges ("PlC
Charges") that may be imposed on Supplier as a result of End-
Users moving onto or off of the Supplier's network. In the event
of a dispute regarding a transfer to the Supplier's network,
including, but not limited to those resulting from Customer's
inability or refusal to provide original End-User LOA's when
requested, Customer shall pay Supplier such PlC Charges, and any
other expenses or damages suffered by Supplier relating to any
such transfer. To the extent Customer makes any statements or
representations to third parties (including End-Users) with
regard to Supplier, the Services, or the terms hereof, such
statements or representations shall be true and not misleading.
When applicable, Customer will be responsible for notifying each
End-User, in writing (or by any other means approved by the FCC
that: (i) a transfer charge will be reflected on such End-User's
LEC ▇▇▇▇ for effecting a change in primary interexchange
carriers, (ii) the entity name under which such End-User's
interstate, intrastate and/or operator services will be billed
(if different from Customer), and (iii) the "primary" telephone
number(s) to be used for maintenance and questions concerning
such End-User's long distance service and/or billing. Customer
shall send Supplier a copy of the documentation Customer uses to
satisfy the above requirements promptly upon request. Supplier
may change the foregoing requirements at any time in order to
conform with applicable FCC and state regulations.
Notwithstanding the foregoing, however, Customer shall be solely
responsible for ensuring that the transfer of End-Users to the
Supplier's network conforms with applicable FCC and state
regulations, including, without limitation, the regulations
established by the FCC with respect to verification of orders for
long distance service generated by telemarketing.
B. Volume Forecasts. Prior to the Service Commencement Date
and by the end of each quarter thereafter, Customer shall provide
Supplier with forecasts covering a good faith estimate of the
monthly traffic volume and distribution for the ordered Services
for the next three calendar months. Supplier shall provide
Customer with any information reasonably requested to help
Customer with its forecasts. The forecasts are to be in the
format attached hereto as Exhibit B.
C. Certification. Customer shall provide Supplier with a
written certification (the "Certification") of the percentage of
interstate (including international) and intrastate minutes of
use relevant to the minutes of traffic to be terminated in the
same state in which the Supplier HUB is located to which the
Service Interconnection is made. This Certification is attached
as Exhibit E and shall be provided by Customer prior to
commencement of Service for any Service Interconnection. It shall
be updated from time to time: (i) as desired by Customer; or (ii)
upon request of Supplier made no more than once each calendar
quarter. Any such modification or Certification shall be
effective as of the first day of the calendar month following
forty-five days notice to Supplier from Customer. In the event
Customer fails to make such Certification, the relevant minutes
of use will be deemed to be subject to the Intrastate Rates
provided for in the Exhibit A. In the event Supplier or any other
third party requires an audit of Supplier's interstate/intrastate
minutes of traffic, Customer agrees to cooperate in such audit at
its expense and make its call detail records, billing systems and
other necessary information reasonably available to Supplier or
any third party solely for the purpose of verifying Customer's
interstate/intrastate minutes of traffic. Customer agrees to
indemnify Supplier for any liability Supplier incurs in the event
Customer's Certification is not supported by such audit.
4. Excluded ANIs. Supplier has the right to reject any
automatic number identifier ("ANI") supplied by Customer for any
of the following reasons: (i) Supplier is not authorized to
provide or does not provide long distance services in the
particular jurisdiction in which the ANT is located; (ii) a
particular ANT submitted by Customer is not in compliance with
Supplier's then-current format, which shall be made available to
Customer upon request; (iii) Customer is not certified to provide
long distance services in the jurisdiction in which the ANI is
located; (iv) Customer is in default of this Agreement; (v)
Customer fails to cooperate with Supplier in implementing
reasonable verification processes determined by Supplier to be
necessary or appropriate in the conduct of business; or (vi) any
other circumstance reasonably determined by Supplier which
could adversely affect Supplier's performance under this
Agreement or Supplier's general ability to transfer its other
customers or other End-Users to the Supplier's network, including
without limitation, Supplier's ability to electronically effect
PTC changes with the LEC's. However, whether or not Supplier is
electronically connected to the LEC's, Supplier shall issue PlC
orders on behalf of Customer. In the event Supplier rejects an
ANI, Supplier will use its best efforts to notify Customer within
forty-eight hours of its decision specifically describing the
rejected ANI and the reason(s) for rejecting that ANT. Further,
any ANI requested by Customer for Service may be deactivated by
Supplier after five days written notice to Customer if no Service
▇▇▇▇▇▇▇▇ relevant thereto have been generated in any prior period
of three (3) consecutive calendar months.
5. Records. Customer will maintain documents and records
supporting Customer's re-sale of Service, including, but not
limited to, appropriate and valid LOAs from End-Users for a
period of not less than twelve (12) months or such other longer
period as may be required by applicable law, rule or regulation.
Customer shall indemnify Supplier for any costs, charges or
expenses incurred by Supplier arising from disputed PlC
selections involving Service to be provided to Customer for which
Customer cannot produce an appropriate LOA relevant to the ANI
and PlC Charge in question, or when Supplier is not reasonably
satisfied that the validity of a disputed LOA has been resolved.
6. Fraudulent Calls. Customer shall indemnify and hold
Supplier harmless from all costs, expenses, claims or actions
arising from fraudulent calls of any nature which may comprise a
portion of the Service to the extent that the party claiming the
call(s) in question to be fraudulent is (or had been at the time
of the call) an End-User of the Service through Customer or an
End-User of the Service through Customer's distribution channels.
Customer shall not be excused from paying Supplier for Service
provided to Customer or any portion thereof on the basis that
fraudulent calls comprised a corresponding portion of the
Service. In the event Supplier discovers fraudulent calls being
made (or reasonably believes fraudulent calls are being made),
nothing contained herein shall prohibit Supplier from taking
immediate action that is reasonably necessary to prevent such
fraudulent calls from taking place, including without limitation,
denying Service to particular ANI's or terminating Service to or
from specific locations. Supplier shall use reasonable efforts to
notify Customer in the event Supplier takes action upon discovery
of fraudulent calls. In the event Customer discovers fraudulent
calls being made (or reasonably believes fraudulent calls are
being made), Customer shall notify Supplier as soon as possible
at ▇-▇▇▇-▇▇▇-▇▇▇▇.
7. Rates Changes.
A. Supplier reserves the right to modify charges for
international service upon 7 days notice to the customer.
B. RBOC Termination/Origination. Following the Service
Commencement Date for Xclusive Origination Service (e.g. Switched
1+, Dedicated 8XX), Customer will maintain at least 80% of the
originating minutes of domestic United States traffic (during any
calendar month or pro-rata portion thereof) in a Regional ▇▇▇▇
Operating Company (RBOC). Supplier shall have the right to apply
a $0.05 per minute surcharge to the number of originating minutes
which Non-RBOC origination exceeds 20% of the total monthly
service and a $0.10 per minute surcharge to the number of
originating minutes which exceeds 50% of total monthly service.
Following the Service Commencement Date for Xclusive Termination
Service (e.g. Switched 800, XPIN, Dedicated 1+), Customer will
maintain at least 80% of the terminating minutes of domestic
United States traffic (during any calendar month or pro-rata
portion thereof) in a Regional ▇▇▇▇ Operating Company (RBOC).
Supplier shall have the right to apply a $0.05 per minute
surcharge to the number of terminating minutes which Non-RBOC
termination exceeds 20% of the total monthly service and a $0.10
per minute surcharge to the number of terminating minutes which
exceeds 50% of total monthly service.
Non-RBOC Origination or Termination is defined as any
NPA.NXX.XXXX not owned by the following Operating Company
Numbers:
9102 NEW ENGLAND TEL&TEL
9104 NEW YORK TEL CO
9206 ▇▇▇▇ ATLANTIC NJ
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
9211 ▇▇▇▇ ATLANTIC DC
9212 ▇▇▇▇ ATLANTIC MD
9213 ▇▇▇▇ ATLANTIC VA
9214 ▇▇▇▇ ATLANTIC WV
9321 OHIO ▇▇▇▇ TEL CO
9323 MICHIGAN ▇▇▇▇ TEL CO
9325 ▇▇▇▇▇▇▇ ▇▇▇▇ TEL CO
9327 WISCONSIN TEL CO
9329 ILLINOIS ▇▇▇▇ TEL CO
9417 SOUTHERN ▇▇▇▇ TEL CO
9419 SOUTH CENTRAL ▇▇▇▇
9533 SOUTHWESTERN ▇▇▇▇
9631 NORTHWESTERN ▇▇▇▇
9636 MOUNTAIN ▇▇▇▇ TEL CO
9638 PACIFIC NORTHWEST ▇▇▇▇
9740 PACIFIC ▇▇▇▇
8. Invoice & Rates.
A. Due Date. Usage Charges are billed and payable following the
period in which actual usage has been incurred. All Usage Charges
contained in this Agreement are calculated according to the rates
set forth in Exhibit A, attached hereto.
B. Monthly Commitment: Customer shall have a twelve (12) month
period (the "Ram-up Period") beginning as of the Effective Date
to purchase Services hereunder of at least $1.5 Million per month
("the Monthly Commitment Level") During the Ramp-Up Period,
Customer shall have a "take or pay" commitment of' (I)
$300,000.00 leer month commencing on the first day of the month
following three (3) months from the Effective Date and continuing
until the end of the fifth complete calendar month after the
Effective Date, (ii) S750,000.00 per month, commencing on the
first day of the month following six (6) months from thc
Effective Date and continuing until the end of the eighth
complete calendar month after thc Effective Date; (Iii) $1
million leer month, commencing on the first day of the month
following nine (9) months from the Effective Date and continuing
until the end of the eleventh complete calendar month after the
Effective Date; and (v) $1.5 million per month, commencing on thc
first day of the month following twelve (12) months from the
Effective Date and continuing thereafter through the term of this
Agreement, Customer shall have a "take or pay" commitment in the
amount of the Monthly Commitment Level. As used herein, a 'take
or pay" commitment means that Customer has the obligation to pay
for Services hereunder; During the Ramp-Up period, however,
Customer shall only be invoiced for actual Usage Charges, based
upon the rates in Exhibit A. Commencing on the First day of the
twelfth month after the Effective Date, Customer shall have a
"take or pay" commitment in the amount of the Monthly Commitment
Level. As used herein, a "take or pay" commitment means that
Customer has obligation to pay for Services hereunder (at the
same time as payment is or would be due for Service for such
month) in such amount for each month during such periods, whether
or not such Service is actually used, excluding, without
limitation, service charges, interest, installation costs, local
loops and nonrecurring charges. Subject to the terms and
conditions herein, Customer shall pay for Services hereunder at
the rates reflected in Exhibit
9. Calculation of Call Duration. Supplier will calculate call
duration for Call Detail Records ("CDR's") which will be sent to
Customer by Supplier for Customer' to rebill Customer's End-
Users, based upon the then-current IXC On-line software
Specifications, Customer will be billed according to the rates in
the attached exhibits based on call duration of each CDR. Call
duration for termination services will he from answer Supervision
of the called party to disconnect. Call duration for 8XX'
origination service will be from trunk seizure of the Customer's
platform to disconnect. CDR's, upon request by Customer will be
sent by Supplier within live (5) business days from the end of
the month In which service is rendered. Customer shall choose to
have the CDR's delivered either by electronic transmission or by
CD ROM and shall pay for such delivery according to the Schedule
set forth in Exhibit A. CDR's shall be male available for up to
one (1) year from the date of service. The information format of
the CDR's is included in the User Guide and is subject an change
from time to time at Supplier's sole discretion.
10. Customer Default: In the even: of a "Customer Default", upon
notice to Customer, Supplier may (in addition to such other
rights or remedies as Supplier may have under this Agreement, at
law or in equity), at its sole option do any or all of the
following: (i) suspend Services to Customer until such time as
such circumstance is corrected (provided Supplier shall not be
prohibited from terminating this Agreement after suspending
Services); (ii) cease accepting or processing orders for
services; (iii) withhold delivery of CDR's; (iv) draw on any
security deposit or other assurance of payment submitted under
this Agreement; (v) terminate this Agreement without liability to
Supplier, which termination may include Immediate cancellation of
the Services; (vi) directly contact the End-Users to inform them
that their long distance service will no longer be provided
through Customer, but may he continued through Supplier directly;
(vii) ▇▇▇▇ and collect from such End-Users directly (or through
its billing agents) for services provided by Supplier an them;
(viii) treat such End-Users as Supplier customers for all
purposes; (ix) require Customer to use its reasonable efforts to
cause part or all of Customer's carrier identification codes and
End-Users to be re-directed to the Supplier network; or (x)
pursue such other remedy or relief as may be appropriate.
"Customer Default" shall mean Customer: (i) breaches any material
provision of this Agreement, including, but not limited to, the
provision regarding payment, and does not cure such breach within
thirty days (five days with respect to the first three payment
breaches and no notice period with respect to any three payment
breach) of notice thereof by Supplier; or (ii) files or initiates
proceedings or has proceedings filed or initiated against it,
relating to its liquidation, insolvency, reorganization or other
relief (such as the appointment of a trustee, receiver',
liquidator, custodian or other official) under any bankruptcy,
insolvency or other similar law or makes an assignment for the
benefit of its creditors or enters into an agreement for the
composition, extension or readjustment of its obligation in
connection with the foregoing. Supplier shall have the right to
review Customer's credit at any time during the Term of this
Agreement, and to require an additional cash deposit, or other
security satisfactory to Supplier. If Customer uses the Services
for any unlawful purpose or in any unlawful manner, Supplier
shall have the right to suspend any or all services hereunder to
Customer until the unlawful use ceases. Notwithstanding anything
herein to the contrary, no termination shall affect or reduce
Customer's obligation to make the "take or party commitment"
payments required herein.