TELECOMMUNICATIONS SERVICES AGREEMENT
This Agreement is made by and between Teltran International, Inc. ("Teltran"), a
Delaware corporation with its principal offices at Xxx Xxxx Xxxxx, Xxxxx 0000,
Xxx Xxxx, XX 00000, and Pacific Gateway Exchange ("Customer") with its principal
offices at 000 Xxxxxxx Xxxxxxxxx, Xxxxxxxxxx, XX 00000. This Agreement will
become effective on the date it is executed by both parties.
WHEREAS, Customer desires to purchase telecommunications services from Teltran
and Teltran desires to sell such services to Customer. NOW, THEREFORE, intending
to be legally bound, the parties agree as follows:
1. Services Provided: In accordance with the terms and conditions of this
Agreement, Teltran shall provide telecommunication services (the "Services") to
Customer. Services can be accessed via DS-1 or DS-3 type access or by other
means agreeable to Teltran. Obtaining access to Teltran's facilities is the
responsibility of Customer. Services shall be at the rates, terms or upon the
conditions described in Schedule A annexed hereto and shall be limited to those
countries set forth on said Schedule A unless otherwise agreed. Teltran shall
have the right to change the rates and countries set forth on Schedule A and
annexed hereto upon seven days written notice to Customer ("Change of Rate
Notice").
2. Service Term: The Service Term shall begin after Customer has tested the
Service and begins to send live traffic ("Start of Service") and shall be
provided hereunder for a period of one-year from the Start of Service. The term
shall be automatically renewed on a month to month basis after the initial
service-term unless written notice is provided otherwise 30 days prior to the
expiration of the Service Term.
3. Commitment: Customer agrees to use and accept the services at the rates and
upon the terms and conditions set forth in Schedule A.
4. Service Interconnection - Technical Requirements In order to utilize the
Service, a connection between Customer's network ("Customer Location") and the
Teltran network at the Teltran designated point-of-presence facilities ("Teltran
POP") may need to be established ("Service Interconnection"). If necessary,
Customer shall be responsible for establishing each Service Interconnection over
facilities subject to Teltran approval. If a Service Interconnection is proposed
to be made via a local exchange carrier, Teltran may direct Customer to utilize
Teltran's local serving arrangement and Customer will be subject to a
non-discriminatory charge therefore from Teltran.
4.1 Service Interconnection - Loading Teltran will provide space at their POP's
for Customer to connect the necessary service interconnections. If available,
Teltran also agrees to provide additional interconnection capacity as needed by
Customer.
5. Billing; Payment Due Dates; Restriction Or Disconnection of Services;
Collection Charges; Interest: Customer is liable for all amounts due Teltran
hereunder, subject to the following. Teltran will calculate the length of each
Service call based upon rounding to the next higher six seconds with a minimum
billing period of thirty seconds, except to Mexico or where rates are listed on
Schedule A based upon one minute billing periods, in which case the length of
the Service call will be rounded to the next higher one minute interval.
5.1 Surety: Prepaid Billing, Cash Deposit, Letter of Credit: Customer hereby
agrees, upon verification that each service interconnection is completed and
successfully provides Services, to deposit an irrevocable Stand-by Letter of
Credit for an estimated two weeks of traffic, 48 hours prior to turning on the
connections and transporting live traffic, all pursuant to the terms and
conditions of this Agreement. Unpaid traffic cannot surpass the value of the
Letter of Credit ("hereinafter referred to as 'Surety'"). In the event that
services have not commenced within 30 business days of deposit of the Surety,
Customer shall have the right to demand return of the full amount of its Surety
and upon return of such Surety neither Customer nor Teltran shall have any
further obligations to the other under this Agreement. The non-prevailing party
shall reimburse the prevailing party for reasonable attorney's fees and other
costs associated with collecting delinquent payments from Customer. Teltran's
banking details are attached as Schedule B.
5.2 Weekly Billing: Commencing after the end of the first week of Services and
continuing every week thereafter, Teltran shall deliver via facsimile or e-mail
transmission an invoice and weekly traffic report to the Customer, which invoice
and report shall set forth the actual amount and cost of Services rendered to
Customer during the immediately preceding week according to Teltran's records.
The billing cycle shall begin 00:00 on Monday.
Such invoice may also contain any appropriate debits or credits to previous
invoices rendered to Customer. Upon receipt of the invoice the Customer shall,
within three (3) business days, deliver the undisputed invoice amount via wire
transfer for deposit in Teltran's account. Any disputed portions of invoices
will be addressed per Section 5.3; however, non-disputed portions of invoices
shall be payable within three (3) business days per the above. In the event that
the amount of unpaid traffic exceeds the Surety amount, the Customer shall
within forty-eight (48) hours of written notification from Teltran, deliver to
Teltran an increase to the Surety for a sum equal to the difference between the
invoice amount and the previous Surety. Should the actual usage regularly exceed
the Surety amount, Customer will have the option to make more frequent payments
to obviate the requirement of increasing the amount of the Surety. Teltran
reserves the right to immediately discontinue Service should unpaid traffic
exceed the value of the Surety with prior written notice to Customer.
5.3 Billing Disputes: Any billing discrepancies shall be presented by the
Customer to Teltran in reasonable detail, in writing, within 60 days of the date
of the invoice in question. Teltran shall not be obligated to consider any
customer notice of discrepancies that are received by Teltran more than 60 days
following the date of the invoice in question. If Teltran fails to reply in
writing regarding the customer dispute within 30 days, the disputed amount shall
be deemed valid and accepted by Teltran. Both parties shall endeavor to resolve
all disputes within 30 days of Customer's written notification.
5.4 Arbitration: Both parties agree to act in good faith to resolve billing
disputes between each other. If within thirty (30) days a dispute is not
resolved, both parties agree to immediately resolve disputes with binding
arbitration with respect to any and all proceedings. Any such proceeding shall
be pursuant to the rules of the American Arbitration Association as they are
applicable to the immediate resolution of disputes brought forward. One
arbitrator, who must be knowledgeable in the telecommunications industry, will
be utilized in any proceedings. The arbitrator shall be empowered to promptly
adjudicate and determine each proceeding in law and/or in equity, and must
determine who the prevailing Party is within ten (10) days after a notice of
dispute has been sent by one Party to the other Party. Judgment upon the award
will be final and may be entered in any Federal or State Court having
jurisdiction thereof. Both Parties agree to immediately comply with the
judgement having been entered and/or confirmed.
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6. Termination by Customer: Customer may terminate this Agreement by giving
written notice to Teltran thirty (30) days prior to Customers desired
termination date. If Customer terminates this Agreement before expiration of the
Services Term, Customer will be billed for and shall pay within ten (10)
business days after such Termination the total outstanding charges due.
Nothing herein contained shall be construed as preventing Customer from
canceling this agreement without further liability in the event Teltran fails to
provide the service on a regular basis consistent with the standards of Voice
over Internet Protocol (VoIP) providers in the industry as to technical quality.
The parties agree that because of the nature of the technology and Networks, the
call quality of calls placed over the Network may be less than that from the
normal use of the PSTN.
Customer may test the Service before purchasing and if the quality of the
service does not meet their requirements, this contract may be cancelled
immediately and a return of all Surety will be made without further liability.
7. Termination by Teltran: Teltran may terminate this agreement by giving
written notice to Customer thirty (30) days prior to its intention to do so. If
Teltran terminates this Agreement or the Services provided pursuant to this
Agreement due to Customer's breach of any of the covenants, representations and
warranties herein, the termination may be immediate and the Customer will be
billed for and shall pay within ten (10) business days the total outstanding
charges due.
8. Representations and Warranties of the Parties: The rates, terms and
conditions herein are expressly conditioned upon the following representations
and warranties by the Customer:
8.1 Each party has obtained the required operating authority in all states in
which it conducts business, as well as authority required by the FCC for the
sale of telecommunications services, including but not limited to authority
required pursuant to Section 214 of the Communications Act of 1934, 47 U.S.C.
214.
8.2 Each party 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.
9. Disclaimer of Warranties; Limitation of Liability: Teltran (including its
subsidiaries, affiliates, 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. In no event shall Teltran be
liable for consequential, special or indirect damages or lost profits sustained
by reason of its 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 any one has been advised of the
possibility of such damages. Teltran shall have no liability for damages caused
(a) by Customer's failure to perform its responsibilities under this agreement,
or (b) by the acts of third parties (including without
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limitation Customer's users or end users). 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). 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 termination of this Agreement. Teltran's sole
liability and obligation to Customer, except in the case of claims arising out
of intentional wrongful acts of Teltran, shall be to use commercially reasonable
efforts to investigate and, to the extent reasonably practicable and within the
reasonable control of Teltran, correct the circumstances that caused such
errors.
10. Duty to Indemnify and Defend: The parties shall indemnify, defend and hold
harmless each other and its directors, 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 the other party 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 arising form combining or using facilities
or equipment furnished by the party in connection with facilities or equipment
furnished by others. The parties shall also indemnify, defend and hold each
other harmless from all causes of action, claims, liabilities or expenses
asserted or incurred by any of the other party's Users of End-users arising out
of any failure, breakdown, or interruption of service provided to the other
party by the party or to End-users by the other party. The parties shall
indemnify, defend and hold each other harmless from all causes of action,
claims, liabilities or expenses asserted or incurred by the other party's
End-users due to the other party's marketing efforts, including but not limited
to the other party's violation of laws and regulations applicable to the
authorization and proof of authorization necessary to convert an End-user's
former service to the other party's service as the End-user's Primary
Interexchange Carrier.
11. Confidentiality: Since each Party may have access to the other Party's
confidential, sensitive, and/or proprietary information including, without
limitation, financial information, rates, supply and service information,
technical data and specifications, marketing information, customer and personnel
information, and dialing patterns ("Proprietary Information"); therefore, during
the Term and thereafter, neither Party shall disclose any terms of this
Agreement, including pricing, or Proprietary Information of the other Party
except as required by law. Any disclosure hereof required by legal process shall
only be made after providing the non-disclosing party with notice thereof in
order to permit the non-disclosing party to seek an appropriate protective order
or exemption. Proprietary Information shall remain the property of the
disclosing Party. A Party receiving Proprietary Information shall: (i) use or
reproduce such information only when necessary to perform this Agreement; (ii)
provide at least the same care to avoid disclosure or unauthorized use of such
information as it provides to protect its own Proprietary Information; (iii)
limit access to such information to its employees or agents who need such
information to perform this Agreement; and (iv) return or destroy all such
information, including copies, after the need for it has expired, upon request
of the disclosing Party, or upon termination of this Agreement. Because of the
unique nature of Proprietary Information, a breach of this paragraph may cause
irreparable harm for which monetary damages may be inadequate compensation.
Accordingly, in addition to other available remedies, a Party may seek
injunctive relief to enforce this paragraph. The parties to this Agreement also
acknowledge that no effort shall be made to circumvent its terms in an attempt
to gain customers, commissions, fees, remuneration, rates or considerations to
the benefit of any of the parties of this Agreement, while excluding equal or
agreed to benefits to the other party.
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12. Taxes: Upon execution hereof, Customer shall provide Teltran with a
properly executed Certificate of Exemption for all foreign, federal, state,
county and local taxes and fees (if any) and shall be responsible for the
collection of all applicable end-users taxes and fees and the remittance of such
taxes and fees to the relevant government authority. Teltran shall pass through
to Customer and Customer shall pay all taxes that may be so passed on to
Customer by law.
13. 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.
14. 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:
14.1 Abuse - The abuse of Service is prohibited. The following activities
constitute abuse:
o Knowingly using Service to make calls that might reasonable be
expected to frighten, abuse, torment, or harass another, or
o Knowingly using Service in such a way that it interferes unreasonably
with the use of Service or Teltran's network by others.
14.2 Fraudulent Use - The fraudulent use of or the intended or attempted
fraudulent use of, Service is prohibited. The following activities constitute
fraudulent use:
o Knowingly using Service to transmit any message or code, locate a
person, or otherwise give or obtain information, without payment for
Service, or
o Knowingly 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.
In any instance in which Teltran believes in good faith that there is fraudulent
use of Service as set forth above, Teltran may immediately upon notice to
Customer, and without liability on the part of Teltran, restrict, suspend, or
discontinue providing Service.
15. Assignment: Customer may not assign this Agreement in whole or in part
without the prior written consent of Teltran which shall not be unreasonably
withheld or delayed. Teltran may, in its discretion, condition its consent to
such assignment upon the posting of an appropriate deposit by the assignee.
Teltran 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 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.
16. Independent Parties: The relationship established by the Agreement shall in
no way constitute Teltran (or its agents or employees) as a partner, agent or
fiduciary of Customer.
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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
Teltran. The provision of service described in this agreement does not establish
any joint undertaking, joint venture or fiduciary relationship between Teltran
and Customer.
17. Force Majeure: Neither party nor its affiliates, subsidiaries,
subcontractors or agents 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, act 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.
18. Severability: If any portion of this Agreement shall be found to be invalid
or unenforceable, such portion shall be void and have no effect, but the
remainder of the Agreement shall continue in full force unless the Agreement
fails in its essential purpose without the voided portion.
19. Notices: All notice, 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 of sent by telex or facsimile ("fax") to
the recipient party, unless the parties otherwise agree in writing. Notice shall
be addressed to the following:
If to Teltran: If to Customer:
-------------- ---------------
Xx. Xxxxx Xxxxxxxx Mr. Xxxxxxx Xxxx
Vice President - Sales & Marketing Vice President, Network Service
Teltran International, Inc. Pacific Gateway Exchange, Inc.
Xxx Xxxx Xxxxx, Xxxxx 0000 000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000 Xxxxxxxxxx, XX 00000
Phone: 000-000-0000 Phone: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
E-mail: xxx@xxxxxxx.xxx E-mail: xxxxx@xxxxxx.xxx
---------------
20. Compliance with laws: Each party is responsible for its own compliance with
all laws and regulations affecting its business, including but not limited to
the collection and remittance of all taxes and other levies imposed by law.
21. Choice of Law: The domestic law of the State of New York, except its
conflict-of-laws rules, shall govern the construction, interpretation and
performance of this agreement.
22. Limitations: Except for the warranties explicitly set forth within, Teltran
specifically excludes and disclaims all warranties, express or implied,
including any warranties of merchantability and fitness for a particular
purpose. In no event shall Teltran have any liability to Customer, nor may this
agreement be cancelled, for any reasonable interruption of service involving the
network or the access lines (failure of the underlying carrier circuits, power
failure, flood, riot, etc.), nor shall Teltran be liable in any way to Customer
for any delay, failure in performance, or loss or damage due to any conditions
beyond its reasonable control.
Customer may test the Service before executing this Agreement and/or providing
Surety and if the quality of the service does not meet their requirements, this
contract may be cancelled immediately and a return of all Surety will be made
without further liability.
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23. Jurisdiction: Each party hereby irrevocably consents to the jurisdiction of
the courts of the State of New York in connection with all disputes (not
including billing disputes which is subject to Section 5.4 - Arbitration),
controversies, claims and actions arising in connection with or relating to this
agreement and agrees that such courts shall be sole and exclusive jurisdiction
of such disputes, controversies, claims and action. Each party hereby waives
personal service of any summons, complaint or other process and agrees that the
service thereof may be made by certified or registered mail directed to such
party at the address for notice pursuant to Paragraph 18 above.
IN WITNESS WHEREOF, the parties have executed this Telecommunications Service
Agreement on the date written below.
TELTRAN INTERNATIONAL, INC. PACIFIC GATEWAY EXCHANGE, INC.
By: By:
--------------------------- --------------------------------
Xxxxx X. Xxxxxx Xxxxxxx X. Xxxx
President & CEO Vice President, Network Services
Date: Date:
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