SERVICES AGREEMENT
This Services Agreement (the "Agreement"), effective as of August 1,
2000 is made and entered into by and between PRE-CELL SOLUTIONS, INC., a
Colorado corporation ("Service Provider") and TELECONEX, INC., a Florida
corporation ("Seller").
RECITALS:
WHEREAS, Service Provider and Seller have entered into that certain
Agreement and Plan of Merger (the "Agreement and Plan of Merger"), effective
August 1, 2000, whereby Service Provider will acquire from Seller substantially
all of the assets owned or held by Seller and used or useful in connection with
the operation of the business; and
WHEREAS, as contemplated by Sections __________ of the Agreement and
Plan of Merger, Service Provider and Seller are entering into this Agreement
whereby Service Provider will arrange to provide certain services to Seller on a
fee basis from and after the effective date hereof.
NOW THEREFORE, in consideration of the promises and the terms and
conditions set forth herein, the parties hereto agree as follows:
ARTICLE I
SERVICES TO BE PROVIDED BY SERVICE PROVIDER TO SELLER
SECTION 1.01 Services to be Provided. (a) Subject to the terms and
conditions stated herein, until either termination of this Agreement pursuant to
Article II hereof or upon Closing as set forth in the Agreement and Plan of
Merger, Service Provider agrees to provide (or to cause an Affiliate reasonably
acceptable to Seller to provide) to Seller each of the services specified in
Schedule A hereto (the "Services") in connection with the Customer Accounts and
any future customer accounts sold by Service Provider pursuant to the Sales
Services described in Schedule A.
(b) Service Provider and Seller acknowledge that there will be a
transition period for the Customer Accounts to be switched from Service Provider
to Seller as the carrier. Until such time as all of the Customer Accounts are
switched to Seller, Service Provider shall continue to provide the same
telecommunications services for such Customer Accounts as were provided by
Service Provider prior to the effective date of the closing (the
"Telecommunications Services").
(c) Use of Sellers Facilities and Records. Subject to the terms of this
Agreement, and of the Public Utility Commissions Rules and Regulations, Service
Provider shall be permitted to occupy and use offices and equipment to allow
Service Provider to fully carry out its objectives under this Agreement. Service
Provider shall also have full access to sales records files and other
information relating to the Business.
SECTION 1.03 Agreement is Limited to the Services. Seller expressly
acknowledges that Service Provider's obligation to furnish services in
connection with the conveyance of the Customer Accounts to Seller is
specifically limited to the Services and Telecommunications Services as
described in Section 1.01 of this Agreement and creates no other obligation on
the part of Service Provider to provide any other services to Seller in
connection with the Customer Accounts or any future customer accounts sold by
Service Provider pursuant to the Sales Services described in Schedule A.
SECTION 1.04 Limitation on Liability. (a) Service Provider shall have
no liability to Seller, its officers, directors, employees, agents or customers
for a failure to render the Services or the Telecommunications Services unless
such failure is a result of Service Provider's gross negligence or willful
misconduct in connection with the rendering of the Services or the
Telecommunications Services, it being expressly understood and agreed that
Service Provider's only obligation with respect to negligent or other deficient
performance in connection with the rendering of the Services or the
Telecommunications Services shall be to re-perform same at no cost to Seller.
Notwithstanding the foregoing, Service Provider's aggregate liability to Seller
in respect of the Services and the Telecommunications Services in the event of
gross negligence or willful misconduct by Service Provider shall not exceed the
amount of fees paid by Seller to Service Provider pursuant to this Agreement
during the twelve months prior to the date of such failure; provided that if the
date of such failure occurs prior to the twelve month anniversary of the date
hereof, the aggregate liability shall not exceed an amount equal to the good
faith estimate of the fees to be paid during the first twelve months of this
Agreement, which estimate will be based on the aggregate amount of aggregate
fees received by Service Provider pursuant hereto at the time of such failure.
(b) Service Provider agrees to indemnify and hold Seller harmless from
and against all loss, damage or expense (including reasonable attorney's fees
and expenses) that Seller may incur or suffer from claims by third parties in
connection with a failure to render the Services or the Telecommunications
Services in accordance herewith.
(c) Seller agrees to indemnify and hold Service Provider harmless from
and against any and all loss, damage or expense (including reasonable attorney's
fees and expenses) that Service Provider may incur or suffer from claims by
third parties in connection with the Services and the Telecommunications
Services, except for any claims arising out of Service Provider's negligence.
(d) Both parties' rights to and obligations of indemnification set
forth in this Section 1.04 shall survive the expiration or termination of this
Agreement.
(e) Notwithstanding anything in this Agreement to the contrary, Service
Provider shall in no event be liable or responsible for its failure to carry out
any of its obligations under this Agreement caused by force majeure. The term
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"force majeure" as used herein shall mean any cause beyond the control of
Service Provider, which by exercise of reasonable diligence, Service Provider is
unable to overcome, including, without limitation, the following: Acts of God,
fire, flood, landslide, lightning, earthquake, hurricane, tornado, storm, freeze
or drought; blight, famine, epidemic, or quarantine; strike, lockout, or other
labor difficulty; theft; casualty; accident; computer, telephone or other
equipment breakdown; the failure of a common carrier; failure or shortage of, or
inability to obtain from usual sources, goods, labor, equipment, information or
drawings, machinery, supplies, software, power, fuel, telephone or other data
communications services or material; embargo or injunction; litigation or
arbitration with suppliers and vendors; arrest; war; civil disturbance;
explosion' act of public enemies; or sabotage (each a "Force Majeure"). If
Service Provider is rendered unable to fulfill any obligation under this
Agreement by reason of a Force Majeure, Service Provider shall make reasonable
efforts to overcome such inability within a reasonable time.
SECTION 1.05 Quality of Services. (a) Service Provider represents to
Seller that the Services to be provided to Seller shall, in the aggregate, be of
the same quality and in the same manner of performance as such Services were
performed by Service Provider for itself prior to the effective date of the
closing.
(b) Service Provider agrees that Seller may, after giving advance
notice to Service Provider, assign personnel to monitor and review the Services
being provided by Service Provider to Seller pursuant to the terms of this
Agreement so as to ensure that Service Provider is providing Services hereunder
to Seller's satisfaction. Seller agrees that it will limit the number of
personnel assigned to these tasks so as not to disrupt the operations of Service
Provider.
ARTICLE II
TERM
SECTION 2.01 Term. The term of this Agreement shall commence as of
August 1, 2000 and continue through closing of the Agreement and Plan of Merger
unless otherwise Terminated as set forth herein.
ARTICLE III
REGULATORY
SECTION 3.01 Regulatory Requirements. Notwithstanding anything to the
contrary set forth in this Agreement. Seller shall maintain ultimate control
over the Customer Accounts, Tariffs, operation and regulatory compliance.
Service Provider shall not exercise any control over the day-to-day operations
of the Business.
SECTION 3.02 Termination for Change in Public Utility Commission Rules,
Regulations, or Policies. The parties believe that the terms of this Agreement
and the performance contemplated hereunder meet all the requirements of current
Public Utility Commission policy and agree that they shall negotiate in good
faith to meet any PUC concern with respect to it if they are incorrectly
interpreting current PUC policy or if that policy is modified. If the parties
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cannot agree within a reasonable time to modification or modifications deemed in
good faith to be necessary by either party to meet PUC requirements either party
may terminate this Agreement upon written notice to other.
ARTICLE IV
PAYMENTS
SECTION 4.01 Service Fees. Service Provider will bill Seller the fees
set forth on Schedule B on a monthly basis. Payment of each bill shall be made
by Seller promptly following receipt, but in no event later than 5 days after
receipt thereof. Notwithstanding the foregoing, the parties agree that Service
Provider shall have the right to deduct and offset amounts owed by Seller to
Service Provider pursuant to this Agreement from amounts collected by Service
Provider on Seller's behalf from customers as part of the Billing and Remittance
Services described on Schedule A.
SECTION 4.02 Accounts Receivable and Payable. As part of the Accounts
Payable Services and the Credit and Collections Services provided by Service
Provider to Seller pursuant to this Agreement, Service Provider will be
collecting accounts receivable and will be responsible for remitting accounts
payable to underlying carriers. Seller grants Service Provider the right to
deduct and offset amounts due for such accounts payable from the accounts
receivable payments. In the event that there are insufficient accounts
receivable payments to cover the accounts payable at the time payment is due,
Seller shall send sufficient funds to Service Provider to cover payment of the
accounts payable.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.01 Amendment and Modification. This Agreement may be amended,
modified or supplemented only by written agreement signed by both Seller and
Service Provider.
SECTION 5.02 No Third Party Beneficiaries. Nothing in this Agreement
shall confer any rights upon any person or entity which is not a party or a
permitted assignee of a party to this Agreement.
SECTION 5.03 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered in person, by cable, telegram or telex, telecopy,
courier, express mail delivery services or by registered or certified mail
(postage prepaid, return receipt requested) to the respective parties as
follows:
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If to Seller to: if to Service Provider to:
TeleConex Inc. Pre Cell Solutions, Inc.
4104 Barrancas Ave. 385 East Drive
Pensacola, Florida 32507 Melbourne, Florida 32904
Attn: Steve Watson Attn: Harry Christenson, CFO
With a copy to Legal Department With a copy to Legal Department
Or to such other address as the person to whom notice is given may have
previously furnished to others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof).
SECTION 5.04 Assignment. This Agreement and all of the provisions
hereof shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. Neither this Agreement nor
any of the rights, interests or obligations hereunder shall be assigned by any
party hereto without the prior written consent of the other party.
SECTION 5.05 Governing Law. This Agreement shall be governed by the
laws of the State of Florida as to all matters, including, but not limited to,
matters of validity, construction, effect, performance and remedies, without
giving effect to the principles of choice of law thereunder.
SECTION 5.06 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
SECTION 5.07 Interpretation. The article and section headings contained
in this Agreement are solely for the purpose of reference, are not part of the
Agreement of the parties and shall not in any way affect the meaning or
interpretation of this Agreement.
SECTION 5.08 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provisions in any other jurisdiction.
SECTION 5.09 Commercially Reasonable Efforts. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to use
commercially reasonable efforts to take, or cause to be taken, all action, and
to do, or cause to be done, and to assist and cooperate with the other party
hereto in doing, all things necessary, proper or advisable under applicable laws
and regulations to ensure that the agreements set forth herein are complied
with. In case at any time after the date hereof any further action is necessary
or desirable to carry out the purposes of this Agreement, each party hereto
shall take all such necessary action.
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SECTION 5.10 Definitions. All capitalized terms used herein, which are
not otherwise defined herein, shall have the meanings ascribed to such terms in
the Agreement and Plan of Merger.
IN WITNESS WHEREOF, this Agreement has been duly executed by authorized
representatives of each party as of the date first above written.
SERVICE PROVIDER SELLER
By: By:
---------------------------- --------------------------------
Printed Name: Printed Name:
Title: Title:
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SCHEDULE A
Services
CHRIS WATSON TO PROVIDE
SCHEDULE B
Fees
CHRIS WATSON TO PROVIDE
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