Exhibit 10.l0
CARRIER AGREEMENT
BETWEEN
AT&T CORP.
AND
COMMUNICATION SYSTEMS INTERNATIONAL INC.
AVAILABLE: October 24, 1997 and November 30, 1997
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CONFIDENTIAL AND PROPRIETARY
BETWEEN AT&T AND CS INTL
TABLE OF CONTENTS
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Section 1 Acceptance of Offer
Section 2: Service Rates, Terms and Conditions
Section 3. Representations and Warranties of Customer
Section 4. Responsibilities of AT&T
Section 5. Responsibilities of Customer
Section 6. General Terms and Conditions
Schedule A International Outbound Rates
Schedule B Determination of Rates and Charges
Schedule C Connections of Customer Premises Equipment
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CUSTOMER'S INITIALS AT&T INITIALS
THIS CARRIER AGREEMENT ("Agreement") is made and entered into by and
between AT&T Corp., a corporation organized and existing under the laws of the
State of New York and having an office at 295 North Maple Avenue, Basking Ridge,
New Jersey 07920 ("AT&T) and Communications Systems International, Inc. (CS
INTL), 8 South Nevada, Suite 101, Colorado Springs, Colorado 80903 ("Customer").
The terms and conditions herein constitute an offer that may be accepted by
Customer between October 24, 1997 and November 30, 1997 by its signature below,
but which thereafter expires and is null and void, and may be accepted only
once. This Agreement shall become effective when signed by both parties
("Effective Date") in accordance with the Release and Settlement between the
parties dated ___, 1997.
SECTION 1: ACCEPTANCE OF OFFER
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AT&T and Customer, acting through their duly authorized representatives,
hereby agree to the terms set forth in Sections 1 through 6 of this Agreement,
together with its Schedules A through C, as of the last signature date below.
CUSTOMER AT&T CORP.
BY___________________________ BY____________________________
_____________________________ ______________________________
Printed or Typed Name Printed or Typed Name
_____________________________ ______________________________
TITLE TITLE
_____________________________ ______________________________
DATE DATE
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CARRIER AGREEMENT
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SECTION 2. SERVICE RATES, TERMS AND CONDITIONS
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2.1. SERVICES PROVIDED. The following Services are provided under this
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Agreement.
2.1.1. AT&T CARRIER SERVICE - AT&T CARRIER SERVICE ("Carrier Service")
is a virtual private network service that permits outward calling from
designated Central Offices to all Customer-dialed domestic and international
locations. Carrier Service provides only basic calling capabilities. Carrier
Service is furnished for the outbound transmission of voice communications but
may also be used for data, facsimile,.signaling, metering, or other similar
communications, subject to the transmission capabilities of Carrier service, and
the terms and conditions of Section 4. Carrier Service calls are dialed and
completed on a one-plus (1+) basis, without the assistance of an AT&T operator,
and do not include:
. Calling Card calls,
. Person-to-person calls,
. Collect calls,
. Third-number billed calls,
. Conference calls,
. Calls to 500, 700, 800 or 900 Special Service Codes,
. Domestic Intrastate IntraLATA, local toll or local calls,
. INMARSAT and AT&T Maritime Service calls, or
. Audiotext calls.
Types of calling not provided hereunder, but nonetheless routed over the Carrier
Service platform, shall be billed at the applicable AT&T F.C.C. or state tariff
rates. For example, Domestic Outbound Intrastate IntraLATA, local toll, and
local calls that are routed over the Carrier Service platform shall be billed at
the rates specified in the applicable AT&T state tariffs for virtual private
network service.
Carrier Service is provided on a monthly basis. Carrier Service can only be
accessed via DS-1 and/or DS-3 type access. Obtaining access to the Carrier
Service Central Office is the responsibility of Customer.
2.1.2. ACCESS CONNECTION AND LOCAL CHANNEL SERVICE. AT&T ACCUNET Office
Functions and Channel Options, including ISDN Service ("AT&T ACCUNET Service")
is provided as specified in AT&T Tariff F.C.C. No. 9, as it may be amended
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from time to time, and AT&T Terrestrial 1.544 Mbps Local Channel Service ("AT&T
Local Channel Service") is provided as specified in AT&T Tariff F. C. C. No. 11,
as amended from time to time, except that these Services are provided hereunder
only for interconnection with the same IXC Switch(es) to which Customer
interconnects its Carrier Service provided hereunder.
2.1.3. MEANING OF "TARIFF". As used herein, "AT&T Tariff F.C.C." shall be
deemed to refer to any generally applicable documentation that replaces the
named tariff pursuant to In re Policy and Rules Concerning the Interstate,
Interexchange Marketplace, CC Docket No. 96-61, FCC 96-424 (October 31, 1996),
or otherwise in accordance with the Telecommunications Act of 1996, if such
replacement occurs.
2.2. SERVICE TERM. The Term of this Agreement is thirteen (13) months
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beginning with the first day of the first full billing month on or after
Effective Date of this Agreement (hereinafter referred to as the Customer's
Initial Service Date or CISD) for the Services provided under this Carrier
Agreement. There is no renewal option.
2.3. CARRIER SERVICE INTERNATIONAL COMMITMENTS, RATES AND DISCOUNTS.
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2.3.1. CARRIER SERVICE INTERNATIONAL OUTBOUND MINIMUM COMMITMENT (IMC).
Customer shall meet an IMC of $2,400,000 of billing, after all discounts (if
any) have been applied ("Net Billing") for Service Term. The IMC may be
satisfied only by Carrier Service International Outbound usage charges incurred
during those months. If Customer fails to satisfy the IMC by the end of the
Service Term, Customer will be billed a shortfall charge equal to the difference
between the IMC and Customer's actual total Net Billing.
2.3.2. CARRIER SERVICE INTERNATIONAL OUTBOUND MINIMUM QUARTERLY COMMITMENT
(IMQC). Customer shall meet an IMQC of $600,000 of Net Billing per Quarterly
Period as described in Table A, below. If Customer fails to satisfy the IMQC by
the end of each Quarterly Period, Customer will be billed a shortfall charge
equal to the difference between the IMQC and Customer's actual Net Billing for
usage for such Quarterly Period.
Table A
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Quarterly Periods
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Months 1-4
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Months 5-7
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Months 8-10
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Months 11-13
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2.3.3. CONDITIONS FOR REFUND OF AT&T CARRIER SERVICE - INTERNATIONAL
OUTBOUND SHORTFALL CHARGES. If by the end of the Service Term the Customer has
satisfied the IMC, excluding any paid international outbound shortfall charges,
AT&T will apply as a credit to the Customer's final bill an amount equal to the
shortfall charges paid by Customer during the Service Term.
2.3.4. CARRIER SERVICE INTERNATIONAL OUTBOUND USAGE RATES. Base usage rates
("Base Rates") for Carrier Service International Outbound are specified in
Schedule A.
These rates will apply as set forth below.
2.3.5. Carrier Service International Outbound Volume Discounts. Customer
will receive the following volume discounts off the Base Rates in each month in
which the following conditions are met:
2.3.5.1. For calling to international destinations other than
Countries specified in Table I, up to the applicable Minute Caps, Customer will
receive a discount off the Base Rates in accordance with Table II, below, in any
month in which Customer's International Outbound Gross usage exceeds the
specified Revenue Level:
TABLE I COUNTRIES
WITH MONTHLY MINUTE CAPS: M=MILLIONS, K=THOUSANDS
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BRAZIL- 1M DENMARK KOREA (So.) PHILIPPINES THAILAND
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CHINA INDONESIA MEXICO SPAIN
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TABLE II
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REVENUE LEVEL DISCOUNT LEVEL
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> $250,000 2.5%
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> $350,000 5%
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>$2,500,000 0%
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2.3.5.2 Customer will receive a 2.5% discount on its usage to the
Table I Countries, up to the applicable Minute Cap(s), in any month in which
Customer's Carrier service International Outbound Gross usage exceeds $250,000,
but does not exceed $2,500,000 per month. All incremental minutes of calling
above the applicable Minute Cap, if any, will not be subject to any discount,
but shall be billed at the Base Rate for calling to such country.
2.3.6. RATE INCREASE; CUSTOMER'S RIGHT TO RE-NEGOTIATE. AT&T shall have the
right to increase the rates hereunder on 30 days' written notice to Customer at
any time over the course of the Service Term. Except for rate changes pursuant
to Section 2.3.6.1.
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below, in the event that AT&T increases rates to any of the countries specified
in Table III below ("Table III Countries") , Customer may request re-negotiation
of other terms and conditions of the Agreement so as to compensate for the rate
increase. If no agreement is reached within 15 days after AT&T's notice was
provided hereunder, Customer shall have the right to reduce the IMC and IMQC by
the dollar value of the affected Table III Country(ies) . The new IMQC shall be
based on subtracting Customer's average Net Billing for usage to the affected
country, for the three months immediately preceding the notice. The new IMC
shall be the total of the original IMQC multiplied by the number of quarters
completed at the time the new IMQC is to go into effect, plus the new IMQC
multiplied by the remaining quarters in the Agreement. Customer must notify AT&T
in writing of its intent to change the IMC and IMQC within the Agreement no
later than 15 days after AT&T provision of such notice. The new IMQC shall
become effective for the first complete billing month after the month in which
such notice is given.
TABLE III COUNTRIES
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BRAZIL- 1M DENMARK KOREA (So.) PHILIPPINES THAILAND
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CHINA INDONESIA MEXICO SPAIN
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2.3.61. PAYPHONE EXCEPTION. Notwithstanding the foregoing, AT&T
reserves the right to increase from time to time the rates for the Services
provided under this Agreement, regardless of any provisions in this Agreement
that would otherwise stabilize rates or limit rate increases, as a result of
charges imposed on AT&T stemming from an order, rule or regulation of the
Federal Communications Commission or a court having competent jurisdiction
relating to compensation of payphone service providers. Exercise by AT&T of its
rights pursuant to this Section shall not trigger any right by Customer to
renegotiate or terminate the Agreement.
2.3.7. NO OTHER DISCOUNTS. Customer will not receive any other discounts,
credits, or bonuses that are not expressly provided for in this Agreement.
2.3.8. INTERNATIONAL BILLING. AT&T will calculate the length of each Carrier
Service International Outbound call to destinations other than Mexico based upon
rounding to the next higher 6 second period with a minimum billing period of 18
seconds. The total minutes (including any fractional portion) per country will
be multiplied by that country's rate per minute. AT&T will calculate the length
of each Carrier Service International Outbound call to Mexico based upon one (1)
minute timing. The country sub-totals will be added to determine the Customer's
total usage for purposes of calculation of the Customer's attainment levels. The
Customer's total usage will be compared to the volume discount thresholds. Any
applicable volume discounts will be applied in the same month in which the
minutes occurred.
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2.4. CARRIER SERVICE DOMESTIC RATES AND DISCOUNTS.
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2.4.1. Carrier Service Outbound Domestic Usage Rates. The usage rate for
Carrier Service Outbound Domestic usage is $0.0177 for the initial 18 seconds
and $0.0059 for each additional 6 seconds or fraction thereof for all day parts
and mileage bands.
2.4.2. NO OTHER DISCOUNTS. Customer will not receive any other discounts,
credits, or bonuses whatsoever that are not expressly provided for in this
Agreement.
2.4.3. DOMESTIC BILLING. AT&T will calculate the length of each Carrier
Service Outbound Domestic call based upon rounding to the next higher 6 second
with a minimum billing period of 18 seconds.
2.5. ACCESS AND LOCAL CHANNEL RATES, CREDITS AND WAIVERS.
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2.5.1. RATES. The rate for AT&T ACCUNET Service is the same as specified in
AT&T Tariff F.C.C. No. 9, as amended from time to time. The rate for AT&T Local
Channel Service is the same as specified in AT&T Tariff F.C.C. No. 11, as
amended from time to time.
2.5.2. CREDITS FOR NON-RECURRING AND RECURRING CHARGES. Customer will
receive the following credits against certain tariffed charges paid by Customer
and identified in this paragraph, provided the Customer is current in payment to
AT&T for all Services provided under this Agreement, at the time a credit is to
be applied. If the Customer is not current, the credit will not be applied until
payment is made. AT&T will waive the Nonrecurring Installation Charges for the
AT&T ACCUNET T1.5 or AT&T ACCUNET T.45 Local Channels, Access Connections and
the associated Access Coordination Function Charges ordered in the Total Service
Option provided such service components: (1) are ordered and installed on or
after the CISD; (2) remain in service for at least 12 months. AT&T will also
waive the non-recurring and recurring Access Connection charges on AT&T ACCUNET
T1.5 or AT&T ACCUNET T.45 services when the customer arranges local access with
a local access provider. If the service component is disconnected for any reason
prior to the 12 months, the waived nonrecurring charges will be billed at the
time of disconnect. The waived Nonrecurring and Recurring charges may not exceed
a total of $25,000 for the Service Term.
2.5.3. NO OTHER CREDITS OR DISCOUNTS. The credits provided in this
Subsection are in lieu of any other credits, waivers, promotional offerings or
discounts for the same Services and Functions which may be filed in AT&T F.C.C.
Tariff Nos. 1, 9 and 11.
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2.6. EFFECT OF EARLY TERMINATION.
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2.6.1. TERMINATION BY CUSTOMER. If Customer terminates this Agreement before
expiration of the Service Term, Customer will be immediately liable for the
difference between the IMQC multiplied by four and Customer's actual usage
charges (less any shortfall charges) through the date of termination, unless 1.)
Customer must provide written notice of termination to AT&T, 2. ) Customer must
be current in payments to AT&T at the time of such notice, and 3.) (a)
concurrent with the termination of this Agreement, Customer must replace this
Agreement with a new carrier agreement for International AT&T Outbound Service
of equal or greater term, volume and revenue commitment and of at least a one
year term, OR (b) Customer must have completed at least six months of the
Service Term and incurred international usage charges sufficient to meet the
IMC.
2.6.2. TERMINATION BY AT&T. If AT&T terminates this Agreement or the
Services provided pursuant to this Agreement, due to Customer's breach of this
Agreement prior to the expiration of the Service Term, Customer will be billed
for and shall pay within 30 days a Termination Charge equal to the IMQC
multiplied by the number of quarters (and/or portion of) remaining in the
Service Term and Customer's actual usage charges (less any shortfall charges),
through the date of termination minus actual usage charges.
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SECTION 3: CUSTOMER REPRESENTATIONS AND WARRANTIES
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3.1. REPRESENTATIONS AND WARRANTIES. The rates, terms and conditions herein
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are expressly conditioned upon the following representations and warranties by
Customer. Customer is an interexchange telecommunications common carrier which
warrants as follows;
3.1.1. Customer has obtained the required operating authority in all
states in which it conducts business, as well as all authority required by the
FCC for resale of telecommunications services, including but not limited to
authority required pursuant to Section 214 of the Communications Act of 1934, 47
U.S.C. (S)214.
3.1.2. Customer complies and will continue to comply at all times with
all federal and state laws and regulations applicable to the sale and provision
of service to its Users and End-users, including but not limited to those laws
and regulations applicable to the authorization and proof of authorization
necessary to convert an End-user's former service to Customer's service as the
End-user's Primary Interexchange Carrier.
3.1.3. Customer has no outstanding balances for any AT&T service as of
the Effective Date. This requirement includes affiliates, parents, subsidiaries,
predecessors and successors of Customer and any entity owned 20% or more by any
person or entity which also has an ownership interest of 20% or more in Customer
on the Effective Date.
3.1.4. Customer will utilize the Service offered hereunder only for
lawful purposes, including but not limited to resale of the Service or
components thereof. In the event that Customer resells the service provided
hereunder, it will do so only under its own names, tradenames, logos, trademarks
or service marks. Customer will not publish or use any advertising, sales
promotions, press releases, or other publicity matters which use AT&T's
corporate or trade names, logos, trade marks, service marks, trade dress, or
other symbols that serve to identify and distinguish AT&T from its competitors
(or which use confusingly similar corporate or trade names, logos, trademarks,
service marks, trade dress or other symbols), and will not conduct business
under AT&T's corporate or trade names, logos, trademarks, service marks, trade
dress, or other symbols that serve to identify and distinguish AT&T from its
competitors (or under any confusingly similar corporate or trade names, logos,
trademarks, service marks, trade dress or other symbols). Customer (including
its agents, representatives and independent contractors) will not indicate or
imply to any person or entity that it is AT&T which is selling or providing
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service to Customer's End-users, or that it is affiliated or authorized by AT&T
to sell or provide such service to them or that it is selling or providing such
service to them jointly or in collaboration or partnership with AT&T, or as the
agent of AT&T. Customer will not be deemed to violate the provisions of this
Section 3.1.4. by making statements or by publishing or disseminating written
materials that include the phrase "[customer] utilizes the AT&T Network to carry
a portion of its traffic," provided that said phrase is not used as a headline
or part of Customer's logo " is used only once in any written document, does not
appear more prominently than the surrounding text in said document, or, in the
case of a verbal statement, is not used in such a manner as to confuse the
listener concerning whether it is AT&T or Customer that is selling or providing
service to Customer's end-users, and is true at the time of publication or
utterance. Said phrase may not appear in any document, nor be made in any
statement in which Customer's name does not appear prominently, or in which
Customer is not clearly identified as the carrier providing service to the
End-user.
3.1.5. Customer has had no complaints or proceedings brought against
it, within 18 months prior to its execution of this Agreement, by the FCC, by
any state public utilities commission, by any state Attorney General, or by any
other federal or state authority charging Customer with misrepresenting its
affiliation or relationship to AT&T or to any other carrier whose service it has
resold, and no such complaints or proceedings are pending as of Customer's
execution of this Agreement.
3.1.6. Customer shall initiate use of Carrier Service provided hereunder
only to and from an IXC switch or switches owned and operated by Customer. An
IXC Switch is a telecommunications switch with the following characteristics:
(a) it is capable of being used for the transmission of calls that are routed by
a Local Exchange Carrier to the IXC Switch using Feature Group D Access, or a
functional equivalent; (b) it is capable of interconnecting circuits or
transferring calling between circuits; (c) it has a maximum capacity of not less
than 100,000 access lines; (d) it is used by the Customer to provide Common
Carrier service to end users and (e) is not used to provide switching functions
directly to end users without an interconnecting access arrangement between end
user and IXC switch.
3.1.7 Customer shall have an Average Length of Call ("ALOC") for Carrier
Service of at least 3.0 minutes.
3.1.8. Customer must not exceed a total of 3 dedicated access locations.
3.1.9. All the Customer's usage must be generated from dedicated access
locations.
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3.2. AT&T REMEDIES. If at any time during the term of this Agreement Customer
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is in breach or fails to comply with the representations and warranties
contained in Subsection 3.1, above, such breach or failure shall constitute a
material breach of this Agreement which shall entitle AT&T to the following
remedies.
3.2.1. TERMINATION. If Customer fails to comply with any representation or
warranty in Subsections 3.1.1. through 3.1.6., AT&T may terminate this Agreement
and the Service provided hereunder on thirty (30) days written notice. Customer
shall have the opportunity to cure such failure during the thirty (30) day
period following such notice, and, if such cure is demonstrated to the
satisfaction of AT&T, no termination pursuant to this Paragraph shall occur. In
the event of such termination, Customer shall indemnify, defend and hold
harmless AT&T from any and all complaints, causes or action or other claims
brought against AT&T by any of Customer's End-users due to said termination.
3.2.2. 15% USAGE SURCHARGE. AT&T shall monitor Customer's compliance with
the representations and warranties contained in Section 3.1.7 through 3.1.9 at
the end of each month following the CISD ("Monitoring Periods"). If, at the end
of each such Monitoring Period, the Customer has failed to satisfy any of such
representations and warranties, AT&T will notify the Customer in writing of the
specific failure(s) and the Customer will be billed an amount equal to the
Discounts and Credits specified in Sections 2.3 an 2.5, preceding, and a 15%
surcharge on all International usage billed for the Service as to which Customer
has failed to comply with the representation or warranty during the applicable
monitoring Period (s).
3.2.2.1 CURE PERIOD. As to the representations and warranties in
Section 3.1.7 only, if Customer is found to be non-compliant with such
Section, Customer shall have one opportunity to cure one instance of such
noncompliance by maintaining an ALOC of at least 3 minutes for a Cure Period
of one month immediately following the Monitoring Period during which Customer
was not in compliance, so long as (1): the ALOC during the Monitoring Period
for which Customer was out of compliance with Section 3.1.7 was over 2 minutes
and 10 seconds; and (2): Customer is current in payments to AT&T at the time
of completion of the Cure Period. If Customer's ALOC is at least 3 minutes for
the Cure Period, Customer will receive a one-time Credit in the amount of the
15% surcharge applied in the preceding Monitoring Period. Customer shall be
able to invoke the Cure Period specified herein only once during the term of
this Agreement.
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SECTION 4: RESPONSIBILITIES OF AT&T
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4.1. PROVISION OF SERVICE. Subject to its Correspondent Agreements and
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regulation by Federal and State authorities, AT&T shall provide Service in
accordance with its standard practices and procedures for the operation of its
network. Service shall be available 24 hours per day, seven days per week.
AT&T is responsible for the provision of Service from station to station, but is
not responsible for the quality of transmission or signaling on the Customer's
side of the interface at a Customer's premises. Service is furnished subject to
the availability of the service components required. Customer acknowledges that
it has been advised by AT&T that temporary capacity constraints may exist in
some areas with respect to the availability of Interoffice Channels for ACCUNET
T45 Service as described and defined in AT&T Tariff F.C.C. No. 9. In the event
that, during the term of this Agreement, Customer orders services which are
impacted by such constraints, AT&T will provide Customer with a good-faith
estimate of the availability date for such services.
4.2. INSTALLATION. Upon execution of this Agreement AT&T shall establish a due
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date for commencement of installation of Service and confirm said date with the
Customer (CISD). Customer may delay said due date for commencement of
installation when the Customer's written request for said delay is received by
AT&T at least five (5) business days prior to said due date, provided that the
delay of said due date shall not exceed 30 cumulative calendar days. AT&T will
make every reasonable effort to commence installation of Service by the due
date, but Customer acknowledges that in some cases a delay in commencement of
installation may be unavoidable. If commencement of installation is delayed for
more than 30 days beyond the due date, and such delay is not requested or caused
in whole or in part by the Customer, the Customer may cancel its order for
Service pursuant to this Agreement and shall not thereby be considered to have
breached this Agreement; such cancellation shall be Customer's sole remedy for
such delay.
4.3. MAINTENANCE. AT&T will maintain Service in conformity with its standard
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network operating procedures.
4.4. LIMITATION OF LIABILITY. AT&T (including its subsidiaries, affiliates,
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predecessors, successors and assigns) makes no warranties, express or implied,
and specifically disclaims any warranty of merchantability or fitness for a
particular purpose with respect to services or products provided pursuant to
this agreement. AT&T's liability for service interruptions for any service
provided pursuant to this agreement shall not exceed an
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amount equal to a pro-rated portion of the recurring charges provided for under
this agreement for the service affected for the period(s) during which said
service was affected. This limitation of liability shall apply regardless of the
form of action, whether in contract, tort, warranty, strict liability, or
negligence (including without limitation active and passive negligence). In no
event shall AT&T be liable for consequential, special or indirect damages or
lost profits sustained by reason of its performance or non-performance of this
Agreement, or for any failure, breakdown, or interruption of service, whatever
shall be the cause, or however long it shall last, and regardless of whether
anyone has been advised of the possibility of such damages. AT&T shall have no
liability for damages caused (1) by Customer's failure to perform its
responsibilities under this agreement, or (2) by the acts of third parties
(including without limitation Customer's users or end users). AT&T does not
guarantee or make any warranty with respect to the service provided pursuant to
this agreement when used in an explosive atmosphere. This agreement does not
create any claim or right of action, nor is it intended to confer any benefit on
any third party, including but not limited to any user or end-user of Customer.
The limitations of liability set forth in this agreement shall survive failure
of an exclusive remedy.
4.5. SERVICE, CHANNELS OR EQUIPMENT OF OTHERS. AT&T is not liable for damages
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associated with service, channels, or equipment that it does not furnish. AT&T
does not provide Customer equipment.
4.6. NO PATENT OR SOFTWARE LICENSE. No license under patents or software
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copyrights (other than a limited license to use) is granted by AT&T or shall be
implied or arise by estoppel, with respect to Service offered under this
Agreement.
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CARRIER AGREEMENT
BETWEEN AT&T AND CS INTL
SECTION 5: RESPONSIBILITIES OF CUSTOMER
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5.1. PLACEMENT OF ORDERS AND COMPLIANCE WITH REGULATIONS. Customer is
---------------------------------------------------
responsible for timely payment for all calls placed using service provided
hereunder, for placing any necessary orders and for assuring that it, its Users
and its End-users comply with the provisions of this Agreement and with all
applicable federal and state laws and regulations utilizing in part end-user
certification for verification of compliance. Customer's obligations include
payment for Service calls or services:
- Originated at the Customer's number(s),
- Accepted at the Customer's number(s) (e.g., Collect Calls),
- Billed to the Customer's number(s) via Third Number Billing if the
Customer is found to be responsible for such call or service, the use of a
Calling Card, the use of AT&T EasyReach Service, or the use of a Company-
assigned Special Billing Number, and
- Incurred at the specific request of the Customer.
5.2. BILLING; PAYMENT DUE DATES; RESTRICTION OR DISCONNECTION OF SERVICE;
-------------------------------------------------------------------
COLLECTION CHARGES; INTEREST. Customer is liable for all amounts due to AT&T
- ----------------------------
hereunder, subject to the following. AT&T will provide to Customer a monthly
bill for each of the Services provided under this Agreement, separately or
consolidated at AT&T's option. Said bill or bills will be sent to one Customer
location designated by the Customer. Payment is due on the 20th calendar day
from the Customer's receipt of a given bill ("Due Date"). Customer shall pay
each such bill on or before the due date by wire transfer in accordance with
AT&T's instructions. If full payment by wire transfer is not received by AT&T
on the Due Date, AT&T will notify Customer that such Service will be
disconnected unless payment is received by the 5th calendar day following the
Due Date ("Disconnect Date"). If payment is not received by the Disconnect Date
and AT&T disconnects customer for non-payment, AT&T will again notify Customer
on the day after the Disconnect Date that the disconnect order was issued.
Customer shall reimburse AT&T for reasonable attorneys fees and any other costs
associated with collecting delinquent payments from Customer. At AT&T's option,
interest charges may be added to any past due amounts at the rate of one and
one-half per cent (1 1/2%) per month, unless such interest rate exceeds the
maximum allowed by applicable law, in which case interest shall be at the
maximum lawful rate.
5.2.1. DATE OF RECEIPT OF BILL. Receipt by Customer of a given bill shall be
presumed to have occurred on the date reflected in the business records of
any outside
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overnight delivery service utilized by AT&T, or three business days from the
date of mailing by AT&T via first-class U.S. mail, depending on the delivery
method selected by AT&T. AT&T shall utilize overnight delivery service whenever
practicable, based on its internal business procedures. Upon agreement between
the parties, AT&T shall attempt to provide Customer within 48 hours with a call
detail in a paper form, for the given month, if requested by the Customer and
only if the Customer experiences an emergency requiring such call detail in a
paper form.
5.2.2. WEEKLY BILLING AND PAYMENT OPTION. Notwithstanding the provisions of
Section 5.2 and 5.2.1 above and 5.2.3 following, Customer shall pay its bills in
accordance with this Section 5.2.2. AT&T shall provide to Customer every Monday
an Interim Statement covering the past week's usage. Payments for Services shall
be made by Customer every Wednesday morning based on such Interim Statement.
Monthly bills will continue to be rendered pursuant to Section 5.2.
5.2.2.1 SUSPENSION OF SERVICE. If full payment for actual usage plus
Commitment Shortfall, if any, is not received by AT&T by Wednesday noon in any
given week, AT&T shall have the right to suspend Service hereunder that day upon
oral or faxed notice to Customer. AT&T shall restore service promptly upon
receipt of such past due amounts, subject to its rights under Section 5.2 above.
5.2.3. MEANS OF PAYMENT. Payment shall be effected by wire transfer to
AT&T's account at Mellon Bank, 3 Mellon Bank Center, Room 153-2614, Pittsburgh,
PA 15259-0001, Account No. 1265748, ABA/Trans Routing No. 043000261, or any
other bank or account that AT&T shall identify in writing to Customer from time
to time.
5.3. BILLING AND COLLECTION FROM END-USERS. Customer shall be solely
-------------------------------------
responsible for rendering of bills to and collection of charges from its End
users. Failure of Customer to bill and collect charges from its end-users shall
not excuse in whole or in part Customer's responsibilities to AT&T under this
Agreement, including but not limited to the responsibility to render to AT&T
timely payment of charges.
5.4. INTERFACING AND COMMUNICATING WITH END-USERS. Interfacing and
--------------------------------------------
communicating with End-users shall be the sole responsibility of Customer with
respect to any use that Customer may make of the Service provided pursuant to
this Agreement to in turn provide service to other persons or entities. Such
interfacing and communicating shall include without limitation installation of
service, termination of service, placing of orders, billing and billing
inquiries, reporting of service outages and problems, collection of charges and
handling and resolution of all disputes.
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5.5. DEPOSITS. AT&T may require the Customer, prior to or during the provision
--------
of Service pursuant to this Agreement, to tender a deposit in an amount to be
determined by AT&T in its reasonable discretion to be held by AT&T as a
guarantee for the payment of charges. To determine the financial responsibility
of Customer and/or the specific amount of any deposit required, AT&T may rely
upon commercially reasonable factors to assess and manage the risk of
non-payment, including but not limited to payment history for telecommunications
service (including such service purchased from AT&T), number of years in
business, bankruptcy or insolvency history, current AT&T account treatment
status, financial statement analysis, and commercial credit bureau rating. It
shall be Customer's responsibility to provide to AT&T upon request such
information as is necessary for AT&T to determine the financial responsibility
of Customer, including but not limited to Customer's tax returns, audited or
unaudited financial statements and loan applications. A deposit does not relieve
Customer of the responsibility for the prompt payment of bills on presentation
or the due date appearing on the face of the bills. In lieu of a cash deposit,
AT&T will accept Bank Letters of Credit and Surety Bonds which have been
approved by AT&T. Interest will be paid to Customer for the period that a cash
deposit is held by AT&T. The interest rate used will be compound interest
compounded monthly at the rate of six percent annually unless a different rate
has been established by the appropriate legal authority in the state where the
Service offering is located. The failure of Customer to post a deposit as
required by AT&T pursuant to this paragraph shall constitute a material breach
of this Agreement by Customer which shall entitle AT&T to terminate this
Agreement and the Service provided hereunder upon five (5) business days written
notice to Customer. When the Service for which the deposit has been required is
discontinued, the deposit will be applied to the final bill and any credit
balance will be refunded to the Customer with applicable interest accrued.
5.6. CUSTOMER'S USE OF SERVICE. Customer may use the Services provided pursuant
-------------------------
to this Agreement for any lawful purpose consistent with the transmission and
switching parameters of the telecommunications network, and may resell its use
(or the use of any part thereof) to a third party in the normal course of the
Customer's business, subject to the following:
5.6.1. ABUSE. The abuse of Service is prohibited. The following activities
-----
constitute abuse:
5.6.1.1. Using Service to make calls that might reasonably be
expected to frighten, abuse, torment, or harass another, or
5.6.1.2. Using Service in such a way that it interferes unreasonably
with the use of Service or AT&T's network by others.
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In any instance in which AT&T believes in good faith that there is abuse
of Service as set forth above, AT&T may, upon 5 days prior written notice
to the Customer, and without liability on the part of AT&T, restrict,
suspend or discontinue providing Service, unless Customer cures such
abuse to AT&T's reasonable satisfaction within such period.
5.6.2. FRAUDULENT USE. The fraudulent use of, or the intended or
--------------
attempted fraudulent use of, Service is prohibited. The following
activities constitute fraudulent use:
5.6.2.1. Using Service to transmit any message or code, locate a person,
or otherwise give or obtain information, without payment for Service, or
5.6.2.2. Using or attempting to use Service with the intent to avoid the
payment, either in whole or in part, of any charges by any means or
device, or
5.6.2.3. Using Service to carry calls that originate on the network of a
facilities-based interexchange carrier other than AT&T and terminate
disproportionately to locations for which the cost to AT&T of terminating
switched access is above the average cost of terminating switched access,
based on the published access tariffs of local exchange companies.
In any instance in which AT&T believes in good faith that there is
fraudulent use of Service as set forth above, AT&T may, immediately and
upon written notice to the Customer, and without liability on the part of
AT&T, restrict, suspend or discontinue providing Service.
5.6.3. INTERFERENCE, IMPAIRMENT OR IMPROPER USE. Customer may not use
Service in any manner that subjects AT&T personnel or non-AT&T personnel to
hazardous conditions or results in immediate harm to the AT&T network or other
AT&T services. In any instance in which AT&T believes in good faith that Service
is being used in such manner, AT&T may immediately restrict Service on a
temporary basis. In such cases, AT&T will make a reasonable effort to give the
Customer prior notice. In the event that Customer does not provide to AT&T
within five (5) business days of the temporary restriction of Service acceptable
proof that said use has ceased and that appropriate measures have been taken to
prevent its recurrence, AT&T may immediately and without further notice
terminate Service.
5.7. ACCESS TO CUSTOMER'S PREMISES. The Customer is responsible for arranging
-----------------------------
premises access at any reasonable time so that AT&T personnel may install,
repair,
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maintain, inspect or remove Service components. Premises access must be made
available at a time mutually agreeable to the Customer and AT&T.
5.8. DUTY TO INDEMNIFY AND DEFEND. Customer shall indemnify, defend, and hold
----------------------------
harmless AT&T and its directors, officers, employees, agents, parent,
subsidiaries, successors, and assigns from all claims, damages and expenses
(including reasonable attorneys' fees) arising out of or resulting from, in
whole or in part, the acts or omissions of Customer or its End-users, their
employees, agents or contractors affiliated companies and their employees,
agents or contractors, including but not limited to claims for libel, slander,
invasion of privacy, or infringement of copyright arising from any communication
and claims for patent infringement arising from combining or using facilities or
equipment furnished by AT&T in connection with facilities or equipment furnished
by others. Customer shall also indemnify, defend and hold AT&T harmless for all
causes of action, claims, liabilities or expenses asserted or incurred by any of
Customer's Users or End-users arising out of any failure, breakdown, or
interruption of service provided to Customer by AT&T or to End-users by
Customer. Customer shall indemnify, defend and hold AT&T harmless for all causes
of action, claims, liabilities or expenses asserted or incurred by Customer's
End-users due to Customer's marketing efforts, including but not limited to
Customer's violation of laws and regulations applicable to the authorization and
proof of authorization necessary to convert an End-user's former service to
customer's service as the End-user's Primary Interexchange Carrier. AT&T shall
be indemnified, defended, and held harmless by the Customer, Users and End-users
against all claims, losses, or damages by any person relating to such service
when used in an explosive atmosphere.
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CARRIER AGREEMENT
BETWEEN AT&T AND CS INTL
SECTION 6: GENERAL TERMS AND CONDITIONS
----------------------------
6.1. ASSIGNMENT. Customer may not assign this Agreement in whole or in part
----------
without the prior written consent of AT&T, which shall not be unreasonably
withheld. AT&T may, in its discretion, condition its consent to such
assignment upon the posting of an appropriate deposit by the assignee pursuant
to Paragraph 5.5. of this Agreement. AT&T reserves the right to deny or revoke
its consent to such assignment at any time if the assignee proves unwilling or
unable to comply with the representations and warranties set forth in Section 3
of this Agreement, in which event the Customer shall remain or again become
responsible for performance of all terms of this Agreement. This provision shall
not affect the Customer's right to resell Service. Further, any resale or
assignment shall not release the original Customer from its obligations under
this Agreement.
6.2. COMBINATION WITH OTHER SERVICES OR OFFERS. The terms and conditions of
-----------------------------------------
this AT&T Carrier Agreement do not apply to services that may be purchased by
Customer pursuant to any other AT&T Carrier Agreement, any AT&T Contract Tariff,
or any AT&T F.C.C. or state tariff not specifically referred to herein.
Similarly, except as specified herein, Customer may not apply or take the
benefit of any discounts, credits or promotions available through any other AT&T
Carrier Agreement, any AT&T Contract Tariff or other AT&T F.C.C. or state tariff
in conjunction with the Services provided hereunder.
6.3. INDEPENDENT PARTIES. The relationship established by this Agreement
-------------------
shall in no way constitute AT&T (or its agents or employees) as a partner, agent
or fiduciary of Customer. The relationship established by this Agreement shall
in no way constitute the Customer (or its agents or employees) as a partner,
agent or fiduciary of AT&T. The provision of Service described in this Agreement
does not establish any joint undertaking, joint venture, or fiduciary
relationship between AT&T and Customer.
6.4. ACKNOWLEDGMENT OF RIGHT TO COMPETE. Customer acknowledges and understands
----------------------------------
that it remains at all times solely responsible for the success and profits of
its business, and that AT&T makes no promises, warranties or representations
regarding the Customer's business success or prospects of business success in
connection with the provision of service pursuant to this Agreement. Customer
acknowledges and understands that AT&T will continue to market AT&T services
directly to the public and that such marketing may from time to time bring AT&T
into direct or indirect competition with Customer, and that AT&T may also market
its services to competitors
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of Customer. Customer acknowledges and understands that nothing in this
Agreement diminishes or restricts in any way the rights of AT&T to engage in
competition with Customer or to market its services to competitors of Customer.
6.5. USE OF PROPRIETARY INFORMATION. In the event that either Customer or
------------------------------
AT&T, in the course of performance of their obligations to each other under this
Agreement, obtains or receives proprietary information from the other, each
agrees to use such information only for the purpose of complying with its
obligations under this Agreement and in particular not to use such information
for its own marketing purposes. Customer acknowledges that AT&T may use for its
own marketing purposes any and all information that it obtains from sources
other than Customer, including but not limited to information that AT&T may have
regarding Customer's End-users as a result of the past or present sale or
provision by AT&T of telecommunications services or equipment to said End-users.
6.6. FORCE MAJEURE. Neither party nor its affiliates, subsidiaries,
-------------
subcontractors, or parent corporation shall be liable in any way for delay,
failure in performance, loss or damage due to any of the following: fire,
strike, embargo, explosion, power blackout, earthquake, volcanic action, flood,
war, water, the elements, labor disputes, civil or military authority, acts of
God, acts of the public enemy, inability to secure raw materials, inability to
secure products, acts or omissions of carriers, or other causes beyond its
reasonable control, whether or not similar to the foregoing.
6.7. SEVERABILITY. If any portion of this Agreement shall be found to be
------------
invalid or unenforceable, such portion shall be void and of no effect, but the
remainder of the Agreement shall continue in full force and effect unless the
Agreement fails of its essential purpose without the voided portion.
6.8. NOTICES. All notices, identifications, formal requests or other formal
-------
communications required or desired to be given in connection with this
Agreement, shall be in writing and shall be effective when delivered in person,
mailed by registered or certified post or sent by Telex or facsimile ("FAX") to
the recipient party, unless the parties otherwise agree in writing. Notice
shall be addressed to the following:
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If to AT&T: If to Customer:
Mr. Thomas Nelson Mark Lyons
General Manager Marketing Manager
AT&T Carrier Solutions CS International
7979 East Tufts Ave. Rm. 340 8 South Nevada, Suite 101
Denver, CO Colorado Springs, CO 80903
Voice: 719-471-3332
Fax: 719-471-2893
6.9. MODIFICATION AND WAIVER. This Agreement may be modified only by a writing
----------------------
signed by both parties. The failure of a party to enforce any right under this
Agreement at any particular point in time shall not constitute a continuing
waiver of any such right with respect to the remaining term of this Agreement,
or the waiver of any other right under this Agreement.
6.10. COMPLIANCE WITH LAWS. Each party is responsible for its own compliance
--------------------
with al1 laws and regulations affecting its business, including but not limited
to the collection and remittance of all taxes and other levies imposed by law.
6.11. CHOICE OF LAW. The domestic law of the State of Colorado, except its
-------------
conflict-of-laws rules, shall govern the construction, interpretation, and
performance of this Agreement.
6.12. CONFIDENTIALITY. The terms, conditions, and rates contained in this
---------------
Agreement are confidential, and shall remain so unless and until it shall be
determined by the Federal Communications Commission ("Commission") that legal
requirements, including the Communications Act of 1934 (or any subsequent
legislation) and the regulations promulgated thereunder require the filing of
this Agreement with the Commission, or unless the Commission (or other
government entity with applicable jurisdiction) orders the filing of this
Agreement pursuant to authority granted by law or regulation. In such event,
the party charged with such filing shall file the Agreement as required or
ordered and shall request confidential treatment in connection with such filing.
Absent such a filing requirement coupled with a denial of confidential
treatment, neither party shall disclose the terms or conditions of this
Agreement to any third party, nor issue any public statements relating to this
Agreement without the written consent of the other party, unless such disclosure
or statement is reasonably believed by the party to be compelled by governmental
authority or legal process or is made in connection with the enforcement of this
Agreement. A disclosing party shall furnish reasonable prior notice to the
other party before making the statement or disclosure unless prohibited by law
from doing so.
6.13. DISPUTE RESOLUTION. If a dispute arises out of or relates to this
------------------
Agreement, or its breach, the parties agree to submit the dispute to a sole
mediator selected by the parties
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or, at any time at the option of a party, to mediation by the American
Arbitration Association ("AAA"), to be held at a mutually agreed location. If
not resolved by mediation, it shall be referred to a sole arbitrator selected by
the parties within thirty (30) days of the mediation or, in the absence of such
selection, to AAA arbitration which shall be governed by the United States
Arbitration Act and judgment on the award may be entered in any court having
jurisdiction. The referral shall be to three arbitrators in the event that the
aggregate claims of any party with respect to a dispute exceed $20,000,000.00.
The arbitrator(s) may not limit, expand or otherwise modify the terms of this
Agreement. The Arbitrator(s) shall not have the authority to award punitive or
other non-compensatory damages to either party. The non-prevailing party, as
determined by the arbitrator or mediator, shall pay the attorneys fees and
related costs and expenses of mediation and arbitration of the prevailing party.
The parties, their representatives, other participants and the mediator and
arbitrator shall hold the existence, content and results of mediation and
arbitration in confidence.
6.14. TRADE NAMES, TRADEMARKS, SERVICE MARKS AND REGISTERED MARKS. Neither
-----------------------------------------------------------
Customer nor AT&T shall use the other's trade names, trademarks or service marks
("Marks") without the prior written approval of the other party. Neither shall
display or use the other's Marks, nor permit the same to be displayed or used by
third parties. Nothing in this Agreement creates in a party rights in the marks
of the other.
6.15. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of the
----------------
parties with respect to the subject matter hereof and supersedes all prior
written or oral agreements, proposals or understandings.
6.16. DEFINITIONS. As used in this Agreement, the definitions set forth in
-----------
AT&T Tariff F.C.C. Nos. 1. 9 and 11 shall apply except to the extent that they
are modified or supplemented as follows or elsewhere in this Agreement
6.16.1. "USERS" OR "END-USERS": Those persons or entities to which
Customer provides service as a telecommunications common carrier utilizing the
Service provided to Customer by AT&T pursuant to this Agreement.
6.16.2. "DISPUTE": Any controversy or claim between the parties under this
Agreement or which relates directly or indirectly to this Agreement or the
Services provided hereunder, whether based on contract, product liability,
statute, tort (including negligence or strict liability) or other legal or
equitable theory, whenever brought, between the parties or any of their
employees or agents.
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6.17. DEFAULT. If at any time during the term of this Agreement either party
-------
shall commit an act of bankruptcy within the meaning of the United States
Federal Bankruptcy Act, or bankruptcy, receivership, insolvency, reorganization,
dissolution, liquidation, or other ]proceedings shall be instituted by or
against either party or all or any substantial part of its property under an
applicable law of the United States or any state thereof, and such proceeding
shall not be dismissed within ninety (90) calendar days, the non-defaulting
party shall have the right to terminate this Agreement.
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