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EXHIBIT 10.1
Master Service Agreement between
AppliedTheory Corporation
And
NYSERNet
V1.0
This Master Service Agreement (this "Agreement") is made as of the date of last
execution below (the "Effective Date") and entered into by and between
AppliedTheory Corporation, having its principal place of business at ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and ▇▇▇▇▇▇▇▇.▇▇▇, a not-for-profit corporation
("NYSERNet"), having its principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
Whereas NYSERNet seeks to build and operate an advanced next generation
Internet, NYSERNet 2000, for its member institutions and others;
Whereas NYSERNet desires to obtain telecommunications services as described in
the Exhibits (the "Services"), in support of its network from AppliedTheory, and
AppliedTheory is willing to provide the Services for the rates attached hereto;
Whereas NYSERNet and AppliedTheory seek to further their strategic alliance by
working together on the development of advanced networking technologies which
will initially be deployed and tested in the NYSERNet 2000 network;
NOW THEREFORE, in consideration of the mutual promises and covenants contained
herein, the parties hereto agree as follows:
TERMS AND CONDITIONS
A. DEFINITIONS
A. "NYSERNet" means ▇▇▇▇▇▇▇▇.▇▇▇.
B. "AppliedTheory" means AppliedTheory Corporation and any of its
successors, subsidiaries, sub-contractors, parent, and agents.
C. "Agreement" means this Master Services Agreement together with all
Exhibits that are attached hereto and/or incorporated herein by
reference.
1. SERVICES TO BE PROVIDED
Subject to the terms hereof, AppliedTheory agrees to provide to NYSERNet the
services as are described in Task Orders, incorporated herein or which may be
executed from time to time by both parties (the "Task Orders"). Task Orders are
attached as consecutively lettered Exhibits.
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Exhibit A: Task Order Numbers 99-001A and 99-001B for
Collocation and Transport Services
Exhibit B: Task Order Number 99-002 for Contract Administration
Services
Exhibit C Task Order Number 99-003 for Network Management and
Customer Support Services
Task Orders may be added to this Agreement or may be modified by subsequent Task
Orders by the mutual agreement of the parties. Each Task Order shall become
effective only upon execution by both parties, whereupon such Task Order shall
be deemed a part hereof. Each Task Order will contain a description of the
services to be performed, a timetable for performance and a price. A Task Order
may contain additional terms and conditions as applicable or as the parties may
desire.
When both parties agree to change a Task Order, the initiating party will
prepare a written description of the agreed change (a "Change Authorization").
Acceptance of the proposed change will be indicated by authorized signature of
the Change Authorization by both parties. The terms of a Change Authorization
prevail over those of the applicable Task Order and any of its previous Change
Authorizations. Any change in the Task Order may affect the charges or other
terms. When a change in charges is necessary, AppliedTheory will provide a
written quote and these charges will be included in the Change Authorization.
Work will only begin on both party's acceptance and written authorization of the
Change Authorization.
2. TERM
This Agreement shall begin on the Effective Date and shall continue for three
years or until the end of the committed term length for any Task Order,
whichever is later (the "Initial Term".) Upon expiration of the Initial Term,
this Agreement shall be renewed for three additional one-year terms, at rates to
be renegotiated by the parties, unless written notice is provided by either
party to the other at least sixty (60) calendar days before the expiration of
the Initial Term, or any renewal of such term.
Additional Services not Co-Terminous. If NYSERNet requests additional Services
under this Agreement AppliedTheory will use its best efforts to secure contracts
which have termination dates coinciding with this Agreement. AppliedTheory will
advise NYSERNet of the termination dates of all contracts it enters into in
support of this Agreement. If termination dates for additional Services are not
co-terminous with this Agreement, and such Services are terminated early,
AppliedTheory will pass through to NYSERNet the actual termination costs imposed
by such third parties. Any amendment to this Agreement or its Exhibits, or any
Task Order adding additional Services will include the specific termination
penalties of contracts AppliedTheory proposes to enter into in support of this
Agreement or details about the calculation of any such penalty for pre-approval
by NYSERNet.
3. RATES
The prices for Services provided hereunder are set forth in the applicable Task
Orders.
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4. PAYMENT AND INVOICING
NYSERNet agrees to pay all charges incurred in accordance with the Task Orders.
Charges shall be invoiced monthly and payment in US currency shall be due upon
receipt. Interest charges of one and one half percent (1.5%) per month or the
highest rate permitted by law, whichever is less will accrue daily on all
amounts which are not paid within forty-five (45) days of the date of the
invoice. NYSERNet will pay all applicable taxes, as well as duties or levies, on
the Services except taxes based on the income of AppliedTheory.
5. TERMINATION
5.1 Termination for Default. Either party may terminate this Agreement or any
individual Task Order, in the event of default by the other, provided that the
non-defaulting party so advises the defaulting party in writing of the event of
alleged default and the defaulting party does not remedy the alleged default
within thirty (30) days after receipt of written notice thereof. Default is
defined to include:
A. either party's insolvency or initiation of bankruptcy or
receivership proceedings by or against the party unless said
procedure is dismissed within 60 days;
B. either party's material breach of any of the other terms or
conditions hereof including the failure to make any payment
when due, if the amount of the payment due is not in dispute;
C. the execution by either party of an assignment for the benefit
of creditors, or;
D. failure by AppliedTheory to meet the Performance Criteria as
described in the Exhibits.
5.2 Termination for Other Reasons. The rates and charges under which the
Services are provided are based on certain minimum periods as indicated in the
attached Task Orders. If NYSERNet terminates all or a portion of a Task Order
prior to the expiration of the Term specified in the Task Order, NYSERNet agrees
to pay AppliedTheory a service cancellation charge as outlined in the Task
Order. The effective date of cancellation shall be no earlier than thirty (30)
days after AppliedTheory's receipt of NYSERNet's written request to cancel such
Service or Task Order. Any cancellation charges imposed by a third party access
provider will be passed along to NYSERNet to the extent specified in the Task
Order.
5.3 Termination of this Agreement, a Task Order, or Service for any cause shall
not release either party from any liability which at the time of termination has
already accrued to the other party or which thereafter may accrue in relation to
the period prior to termination or from any obligation which is expressly stated
herein to survive termination.
6. Force Majeure.
Neither party shall be liable for any failure of performances if such failure is
due to any cause or causes beyond the reasonable control of such party,
including, without limitation, acts of God, fire, explosion, vandalism, cable
cut, adverse weather conditions, governmental action, labor difficulties and
supplier failures.
7. LIABILITY
AppliedTheory shall be liable for damages of any nature arising from errors,
mistakes, omissions, interruptions, or delays ("Errors" and individually and
"Error") of or caused by
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AppliedTheory, its agents, servants, or employees, in the course of
establishing, furnishing, rearranging, moving, terminating, or changing the
service or facilities or equipment provided that AppliedTheory's liability for
an Error shall not exceed the amount paid or due by NYSERNet to AppliedTheory
for that portion of any Task Order to which the Error shall relate. In no event
will AppliedTheory be liable to NYSERNet or to any of NYSERNet's own customers
for any incidental, indirect, special or consequential damages (including lost
revenues or profits) arising from any act or omission under this Agreement or
any Task Order. WITH THE EXCEPTION OF THE COVENANTS AND WARRANTIES CONTAINED IN
THIS AGREEMENT INCLUDING ITS EXHIBITS APPLIEDTHEORY MAKES NO WARRANTY TO
NYSERNET OR ANY OTHER PERSON OR ENTITY, WHETHER EXPRESS OR IMPLIED AS TO THE
DESCRIPTION, QUALITY, MERCHANTABILITY, COMPLETENESS OR FITNESS FOR ANY PURPOSE
OF ANY SERVICE PROVIDED HEREUNDER OR DESCRIBED HEREIN, OR AS TO ANY OTHER
MATTER, ALL OF WHICH WARRANTIES BY APPLIEDTHEORY ARE HEREBY EXCLUDED AND
DISCLAIMED.
8. INDEMNIFICATION
8.1 By NYSERNet. NYSERNet shall indemnify, defend and hold harmless
AppliedTheory against any and all losses, damages, injuries, expenses and
liabilities of any type, including attorney's fees, incurred in connection with
(i) any and all claims, proceedings, actions or suits ("Claims") for libel,
slander, infringement of copyright or unauthorized use of any trademark, trade
name or service ▇▇▇▇ arising out of the content transmitted over facilities or
equipment provided by AppliedTheory; and (ii) claims for infringement of any
third party's patent, copyright, trademark, trade secret or other intellectual
property right ("Intellectual Property Rights" and individually, a "Intellectual
Property Right") arising from combining or connecting AppliedTheory's facilities
or equipment with facilities, equipment, apparatus or systems of NYSERNet; (iii)
all Claims of any kind by NYSERNet's end users, except claims arising from
AppliedTheory's actions or failure to act, and (iv) all other Claims (including,
without limitation, claims for damage to any business or property, or injury to,
or death of, any person) arising out of any act or omission of NYSERNet, or
NYSERNet's agents or end users, in connection with any product, service,
facilities or equipment provided by AppliedTheory.
8.2. By AppliedTheory. AppliedTheory shall indemnify, defend and hold harmless
NYSERNet and its subsidiaries and affiliates against any and all losses,
damages, injuries, expenses and liabilities of any type, including attorney's
fees, incurred in connection with (i) any and all Claims for damages to property
or injuries, including death, as a result of an act (whether intentional,
negligent or otherwise) or omission on the part of AppliedTheory or any of its
successors, subsidiaries or affiliates in connection with the Services provided
under this Agreement and (ii) any and all Claims that the Services furnished by
AppliedTheory in the course of this Agreement, or any resulting use, sale,
license, or sublicense of any such Services as authorized herein constitutes an
infringement of such third party's Intellectual Property Rights that occurs
during the term of the Agreement. This Section 8.2 states the sole obligation
and exclusive liability of AppliedTheory (express, implied, statutory, or
otherwise), and the sole remedy of NYSERNet, for any third-party claims of
infringement of any Intellectual Property Rights, subject to Section 8.4.
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8.3 Conditions. Each party's obligation to indemnify the other party for a claim
pursuant to this Article 8 is contingent upon the following conditions: (i) that
the indemnified party notify the indemnifying party in writing within ten (10)
days of the assertion of any such claim, proceeding, action or suit and agrees
not to settle, compromise or otherwise dispose of any such claim, proceeding,
action or suit without the prior written consent of the indemnifying party; (ii)
that the indemnified party allows the indemnifying party to control the defense
and settlement of the claim; and (iii) that the indemnified party provides to
the indemnifying party commercially reasonable information, assistance, and
authority (at the indemnifying party's sole expense, as applicable) reasonably
necessary or useful for the indemnifying party's handling and defense of the
claims ; and (iv) that each party's aggregate liability and obligations arising
out of this Article 8 shall not exceed the lesser of (a.) the total charges paid
by NYSERNet to AppliedTheory under this Agreement during the 12 months preceding
the events giving rise to the Claim at issue and (b) one million dollars
($1,000,000). Notwithstanding the indemnifying party's right to control the
defense and settlement of such claims, the indemnified party may, at its sole
option and expense, participate in such defense and settlement with counsel of
its own choosing.
8.4 Election of Remedy. If NYSERNet's license to or use of AppliedTheory's
Services, as permitted under this Agreement, is enjoined based on a Claim by a
third party that the Services furnished by AppliedTheory in the course of this
Agreement, or any resulting use, sale, license or sublicense of any such
Services as authorized herein constitutes an infringement of such third party's
Intellectual Property Rights, AppliedTheory must, at AppliedTheory's option and
expense:
(i) procure for NYSERNet and its customers the continued right to
use the Services as permitted herein; or
(ii) replace the Services with substantially equivalent
non-infringing Services;
or
(iii) modify the Services so they become non-infringing; or
(iv) if neither (i), (ii), nor (iii) is commercially feasible,
discontinue the Services or remove any equipment relating to
such Services and refund to NYSERNet an amount equal to the
total compensation due AppliedTheory under this Agreement,
less a commercially reasonable fee for NYSERNet's use of the
Services for the period commencing on the Effective Date
hereof and concluding on the effective date of such
injunction.
8.5 No Special Damages. Except for the indemnity provisions contained in this
Article 8, neither party will be liable to the other for special, indirect, or
consequential loss of damage, whether or not such loss or damage is caused by
the fault or negligence of that party, its employees, agents, or subcontractors.
8.6 Exception. AppliedTheory will not have any obligations under this Article 8
in connection with any Claim which is based on the use of the Services (a) other
than for the
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purposes for which they were supplied by AppliedTheory, unless the use of the
Services for such purposes was authorized by AppliedTheory, (b) in a manner
other than as directed by AppliedTheory, unless the use of the Services in such
manner was authorized by AppliedTheory or (c) in combination with products,
goods, or services not supplied by AppliedTheory, unless (i) such combination
was authorized by AppliedTheory and/or (ii) AppliedTheory would otherwise have
an obligation under this section 8.6 in the absence of such combination.
8.7 Survival of Indemnity. Both part indemnity obligations under this Article 8
will survive the expiration or termination of the Agreement.
9. NO ACCEPTABLE USE POLICY
APPLIEDTHEORY WILL NOT IMPOSE AN ACCEPTABLE USE POLICY ON THE SERVICES PROVIDED
THROUGH THIS AGREEMENT. ALL USES OF THE NYSERNET 2000 NETWORK WILL BE CONTROLLED
BY NYSERNET AND ITS MEMBER'S INSTITUTIONS.
10. BUSINESS RELATIONSHIP
This Agreement shall not create any agency, employment, joint venture,
partnership, representation, or fiduciary relationship between the parties.
Neither party shall have the authority to, nor shall any party attempt to,
create any obligation on behalf of the other party.
11. INSURANCE
Unless specified differently in the Task Orders, throughout the term of this
Agreement and any extension thereof, each party shall maintain, and, upon
written request, shall provide to the other party proof of comprehensive general
liability insurance with a limit of not less than $2,000,000 per occurrence for
bodily injury liability and property damage liability, including coverage
extensions for blanket contractual liability, personal injury liability and
products and completed operations liability.
12. MISCELLANEOUS
Assignment
Neither party shall assign or transfer this Agreement without the prior written
consent of the other party, such consent not to be unreasonably withheld.
Dispute Resolution
Disputes relating to this Agreement will be settled in arbitration before a
single arbiter held in accordance with the Commercial Arbitration rules of the
American Arbitration Association and will be governed by the U.S. Arbitration
Act, 9 U.S.C. ss 1, et. Seq., and judgement may be entered in any court of
competent jurisdiction. The arbitration will be held in the Syracuse, NY area.
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Legal Construction
This Agreement shall be governed by the laws of the State of New York pertaining
to contracts made and to be performed in New York without giving effect to
conflicts of laws principles.
Survival
The covenants and agreements of both parties contained in this Agreement with
respect to payment of amounts due, confidentiality and indemnification shall
survive any termination of this Agreement. The rights and obligations under this
Agreement shall survive any merger or sale of either party and shall be binding
upon the successors and permitted assigns of each party.
Amendments
This Agreement may not be modified except by written amendment by the parties.
No agent, employee or representative of AppliedTheory or NYSERNet has authority
to bind the parties to any representation or warranty unless such is
specifically included in this Agreement, any Task Order or written amendments
thereto.
Entire Agreement
This Agreement and the Exhibits attached hereto constitute the entire agreement
between the parties with respect to the subject matter contained herein and
supersedes in full the Memorandum of Understanding dated June 1, 1998 and the
Collocation Services Agreement dated September 23, 1998 between the parties. Any
prior agreements, representations, statements, negotiations, understandings, or
undertakings of AppliedTheory or NYSERNet relating to the subject matter herein
are of no force and effect if not contained in this Agreement or in a Task
Order.
No Implied Waivers
Except as provided herein, no term or provision of this Agreement shall be
deemed waived, no breach or default shall be deemed excused, no waiver or any
breach of any provision of this Agreement shall constitute a waiver of any
prior, concurrent or subsequent breach of the same or any other provisions
hereof, and no waiver shall be effective unless such waiver or consent is made
in writing and is signed by an authorized representative of the party to be
charged with such waiver or consent.
Severability
In the event that any provision of this Agreement shall be determined illegal or
otherwise unenforceable, such provision shall be severed and the entire
Agreement shall not fail on account thereof and the balance of the Agreement
shall continue in full force and effect.
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Notices
Except as otherwise provided in this Agreement, all notices required or
permitted to be given hereunder shall be in writing and shall be valid and
sufficient if dispatched by U.S. registered mail, postage prepaid, return
receipt requested, in any post office of the United States, addressed as
follows:
If to AppliedTheory: If to NYSERNet
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AppliedTheory Corporation ▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn. Contracts Manager Attn. Contracts Manager
Notices so given will be effective on the date of receipt unless otherwise
specified in the notification.
Exhibits
The terms of all Exhibits referenced herein are incorporated herein and made a
part hereof by reference.
Non-Disclosure of Terms
NYSERNet and AppliedTheory each warrant, represent and agree that it will not
disclose the terms and conditions of this Agreement, including but not limited
to pricing, without the other's prior written consent, to any party other than
such parties' accountants, auditors, attorneys, or financial advisors, except to
the extent required by any applicable law. Notwithstanding the foregoing,
NYSERNet hereby consents to disclosure of the terms and conditions of this
Agreement, including but not limited to pricing, in any forms or documents which
AppliedTheory shall file with the Securities and Exchange Commission to the
extent required.
IN CONSIDERATION OF THE MUTUAL PROMISES AND COVENANTS SET FORTH HEREIN,
APPLIEDTHEORY AND NYSERNET AGREE TO BE BOUND BY THIS AGREEMENT AND ATTACHMENTS
HERETO.
AppliedTheory Corporation ▇▇▇▇▇▇▇▇.▇▇▇
/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ III /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇. Dir. Accounting/Controller Chairman of the Board
of Directors/President
6/14/99 6/14/99
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Date Date
AppliedTheory Master Services Agreement
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