Exhibit 10.1
Net Related, Inc.
Service Agreement
This Service Agreement is made as of the 15th day of May, 2000 and
entered into between Net Related Inc., an Alabama corporation ("NRI") and USA
Star, a Kentucky based LLC. ("Client").
Recitals:
Whereas Client is an Internet Service Provider for which Client desires
NRI to perform certain Services (hereinafter defined); and
Whereas NRI desires to perform such Service on the terms and conditions
set forth in this Service Agreement;
Now, therefore, in consideration of the mutual promises set forth
herein, the parties agree as follows:
Agreements:
1. Definitions. For purposes of this Service Agreement, the following
definitions shall apply;
1.10. Billing File Service. Billing File Service shall mean
linking or providing files to a bank and/or credit card processor of your
choice. We provide appropriately formated files and communicate to you the
totals fo each billing cycle. Further we work with you to "suspend" users
that have failed to make payment.
1.20. Total Billing Service. Total Billing Service shall mean
providing the people and the facilities to manage all billing functions.
These functions include accounting, reconciliation, maintenance of accounts,
bank and merchant processing services, reject handling, bad debt collection,
all processing fees which include settlement fees, bank fees, merchant
processing fees, etc. That is, this service places NRI in a position which
they accept total liability and responsibility regarding the billing function.
Client will determine pricing methodology. NRI will simply remit a net check
equal to the amount billed to the Client's customer minus all NRI and Internet
network
1.30. E-mail Service. Email Service shall mean providing email
service to the Client's ISP subscribers. Each of Client's subscribers must
establish an email account through NRI..
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1.40. Technical Support Service. Technical Support Service shall
mean providing the people and the facilities to answer telephone calls from
Client's subscribers or potential subscribers. Client will provide to NRI the
information to be provided to Client's subscribers. NRI will also provide
information tot he Client about the frequency and duration of calls from
Client's customers. NRI will provide its Services 24 hours a day, 7 days a
week.
1.50. Customer Support Service. Customer Support Service shall
mean providing the people and the facilities to answer telephone calls from
Client's subscribers or potential subscribers. NRI will resolve, or escalate
to Client for resolution, calls pertaining, but not limited to, suspended or
blocked user ID, access to the system and billing information. NRI will also
provide information to the Client about the frequency and duration of calls
from Client's customers. NRI will provide its Services 24 hours a day, 7 days
a week. Client must provide assistance to resolve escalated calls beyond
NRI's knowledge.
1.60. Hosting Service. Hosting Service shall mean providing the
people and the facilities to maintain Client provided hardware and/or software
to facilitate connectivity for authentication and e-mail services for Client's
subscribers.
1.70. CD ROM Service. CD ROM Service shall mean the design and
creation of master dialer and browser software customized for Client and/or
each of Client's customers. Customization shall be defined as a) Client
defined customization to top browser bar, favorites, logo and home b) physical
label of CD ROM which shall display Client defined logos and instructions for
use. Client must provide set-up instructions as required by NRI. NRI will be
responsible for hardware consumables. NRI will further mass-produce CD ROMs
as needed.
1.80. Free E-Mail Service. Free E-Mail Service shall mean the
provisioning of e-mail accounts for Clients' non-ISP users and/or additional
e-mail accounts beyond the one included with each ISP user. No Technical of
Customer support shall be provided for these free e-mail users.
1.90. Service. Service shall mean the provision by NRI to Client
of one or more of the following: Billing File Service, Total Billing Service,
Email Service, Technical Support Service, Customer Support service, Hosting
Service, CD ROM Service and/or Free E-Mail Service. All fees are per user
unless otherwise noted.
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2. Cost of Service. In exchange for NRI's Service, Client agrees to
pay NRI the amount noted below for each Client subscriber per month.
Client Initials
Set-Up Fee $7,000 ______________
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Includes 2 Compaq Servers, switches, routers and Realm Creation
NT, SQL, Rodopi, Critical Path, CSI and other software
Creation of the master USA Star CD Rom
Creation of the USA Star customized browser
All tasks associated with testing, project management and
implementation
Term
3 year term with 1-year automatic renewals.
50,000 Minimum End-User Commitment by 12 months
Net Related VISP Program
----------------------------
Subscribers Cost per Account
----------- ----------------
50,000 $11.10
*Total Billing Service
All transaction, settlement, collection, reject processing, etc.
fees are included. Paper invoices are charged at .75
each invoice.
Monthly Per User Fee For:
Unlimited Internet Access via Tier One Network
RADIUS Hosting
E-Mail Hosting Service
Technical Support
Customer Support
Tier One Unlimited Internet Access (up to 56K)
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Minimum Monthly Amount
Minimum Monthly Commitment
______________________________________________
Revenue User Ramp Months |
______________________________________________|
$2,775 250 1 |
______________________________________________|
$5,550 500 2 |
______________________________________________|
$11,100 1000 3 |
______________________________________________|
$22,200 2000 4 |
______________________________________________|
$55,500 5000 5 |
______________________________________________|
$111,000 10000 6 |
______________________________________________|
$138,750 12500 7 |
______________________________________________|
$166,500 15000 8 |
______________________________________________|
$277,500 25000 9 |
______________________________________________|
$333,000 30000 10 |
______________________________________________|
$444,000 40000 11 |
______________________________________________|
$555,000 50000 12 |
______________________________________________|
Minimums are "Take or Pay". Minimums begin in July, 2000.
Status of account will be reviewed on a quarterly basis for the first two
quarters and monthly thereafter.
"Free" E-Mail Service
Per Unique Account per month $0.30 ______
CD ROM Services:
Mass Production (per order per CD):
USA Star Logo Physically Applied to CD, Sleeve and Instructions
included
Net Surfer Dialer ______
0-1,000 $2.50
1,001-2,000 $1.90
2,001-5,000 $1.65
(minimum requirement of 500 CDs per order)
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Distribution Service:
NRI will establish and answer an 800 number for USA Star. Each
caller may request that a CD ROM be mailed. Fee includes all
telephony, human, material and postage related costs.
Per CD Mailed $2.50 ______
3. Set-Up Fees. In order for NRI to provide Client the desired
service, Client must pay all set-up fees upon contract execution.
4. Billing. NRI will send Client a monthly xxxx for Services provided.
The xxxx is due and payable in U.S. dollars within 20 days after its date.
NRI may offer Client a prompt payment discount. Client shall pay NRI a late
payment charge of 1.5 percent per month, or the maximum rate permitted by
applicable law, whichever is less, on any unpaid amount for each calendar
month or fraction thereof that any payment thereof to NRI is in arrears.
Client has the right to dispute any portion of the xxxx. At no time may any
disputed amount exceed the sum of the last months xxxx. If Client does not
pay an undisputed xxxx on time, NRI has the right to terminate its service
without any further notice to Client. Client shall pay all shipping charges,
taxes (excluding those on NRI's net income) and similar charges (any related
interest and penalties) relating to the provision of the Service, except to
the extent a valid tax exemption certificate is provided by Client to NRI
prior to the delivery of Service
5. Term of Service. NRI agrees to provide its Service to Client for a
period of 2 years beginning May, 2000. After the initial term, this Service
Agreement will be reviewed annually at which time cost and terms may change.
This Service Agreement will automatically renew for successive 1 year periods
unless either party gives the other written notice on non-renewal no less than
30 days before the end of the then current term.
6. Termination and Cancellation. This Service Agreement may be
terminated or canceled by the non-defaulting party, if the other party is in
default of any provision hereof and such default is not cured within 30 days
after notice is given or if the other party becomes insolvent or seeks
protection, voluntarily or involuntarily, under any bankruptcy law. In the
event of termination or cancellation of this Service Agreement, NRI may:
declare all amounts owned to it to hereunder to be immediately due and
payable; and cease performance of all service hereunder without liability to
Client.
7. Notice of Promotional Activity. Client agrees to give NRI 30 days
advance written notice of any promotion or marketing activity that may cause
the frequency of incoming telephone calls to exceed the average frequency
incoming calls for the prior 2 months by more than 10%. Client acknowledges
that a promotion or marketing activity that substantially increases the
frequency of incoming calls may
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result in NRI not being able to adequately and efficiently handle such calls
without advance notice.
8. NRI and Client Confidential Information. Through their business
relationship, NRI and the Client will learn about each other's business and
service. NRI and the Client agree that any information one learns about the
business or service of the other is confidential and secret and will not be
disclosed to any other person or entity without the written permission of the
party whose information may be disclosed. Furthermore, Clients data and
Clients customer data, is the sole property of Client. NRI has the right to
make copies and/or transfer this data as necessary to maintain normal and safe
operations. NRI has the right to track, report or sell Client and Client
Customer usage, demographic, frequency, call rate, etc. data only if
aggregated with other NRI client's data. Except as noted, NRI has NO rights
to distribute, sell or otherwise profit from client data. This obligation
will continue after this Service Agreement ends.
9. Negation of Warranty. NRI DOES NOT WARRANT THE SERVICES PERFORMED
HEREUNDER OF THE ACCURACY OR CORRECTNESS OF THE RESULTS OF THE SERVICE, AND
THERE ARE NO WARRANTIES, EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO,
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE.
10. Limitation of Liability. IN NO EVENT SHALL NRI BE LIABLE TO
CUSTOMER FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE OR LOST PROFITS
ARISING OUR OR RELATED TO THIS SERVICE AGREEMENT OR THE PERFORMANCE OF
SERVICES HEREUNDER OR ANY BREACH THEREOF, EVEN IF NRI HAS BEEN ADVISED OF THE
POSSIBILITY THEREOF, NRI'S LIABILITY TO CLIENT HEREUNDER, IF ANY, SHALL IN NO
EVENT EXCEED THE TOTAL AMOUNT PAID TO NRI WITHIN THE PAST TWO MONTHS HEREUNDER
BY THE CLIENT.
11. Excusable Delay. NRI shall not be liable to Client for any delay
in the performance of Service hereunder or for any failure to perform
hereunder if such delays or failures are due to strikes, inclement weather,
acts of God or other causes beyond NRI's reasonable control.
12. Arbitration. All controversies arising out of or relating to this
Service Agreement, or any modification thereof, shall be settled by
arbitration in Colbert or Lauderdale County, Alabama in accordance with the
arbitration rules of the American Arbitration Association.
13. Interpretation. Words and phrases in this Service Agreement shall
be as construed as in the singular or plural as masculine, feminine or neuter
gender as appropriate. The titles used in herein are for organizational
purposes only and shall
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have no determinative effect upon the rights, interests, and/or duties created
in this Service Agreement
14. Governing Law. This Service Agreement shall be governed, construed
and enforced in accordance with the laws of the State of Alabama.
15. Entire Agreement and Binding Effect. This Service Agreement
contains the entire agreement of the parties hereto and no representations,
inducements, promises or agreements, oral or otherwise, between the parties
not embodied herein shall be of any force or effect, and no such
representations, inducements, promises or agreements have been made. This
Service Agreement shall be binding on all parties hereto and their heirs,
successors or assigns.
16. Severability. The invalidity or unenforceability of a particular
provision of this Service Agreement shall not affect the other provisions
hereof, and the Service Agreement shall be construed in all respects as if
such invalid or unenforceable provision were omitted.
17. No Partnership or Agency. This Service Agreement does not create a
partnership or agency relationship between NRI and the Client. No promise
made by Client to a third party is binding upon NRI.
18. Limitation on Assignment. Client shall not assign its rights under
this Service Agreement without the written permission of NRI, which permission
will not be unreasonably withheld. NRI shall not assign its rights under this
Service Agreement without the written permission of NRI, which permission will
not be unreasonably withheld.
19. Notices. Notices, consents, requests, demands, and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered personally or if mailed by first class mail postage
prepaid, addressed to the parties at the address set forth below, or to such
other address as the parties shall have last designated by notice to the other
party.
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If to Client: If to NRI:
------------ ----------
USA Star, L.L.C Net Related, Inc.
000 Xxxxxx Xxxx Xxxx 000 Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000 Xxxxxxxx, Xxxxxxx 00000
In witness whereof, the undersigned have executed this Service Agreement
on the date first written above.
/s/ Xxxx Xxxxxx
By: ______________________
Name: Xxxx Xxxxxx
Company: USA Star
Title: President
/s/ Xxxxx Xxxxx
By: ______________________
Name: Xxxxx Xxxxx
Company: Net Related, Inc.
Title: President
