INTERNET SERVICES AGREEMENT
THIS INTERNET SERVICES AGREEMENT (this "Agreement") is made and entered
into effective July 17, 2001, by and between IKANO Communications, Inc., a Utah
corporation ("IKANO"), and GTC Telecom, a Nevada corporation (the "Company"), on
the following:
PREMISES
IKANO has developed and aggregated several Internet Protocol ("IP") based
products and services; a proprietary IP based billing, provisioning, and
customer management platform (the "Business Rules Platform"); and a network of
networks infrastructure operated by IKANO's network operations centers.
Utilizing this equipment, infrastructure, network resources, and personnel,
IKANO is a turnkey provider of IP products and services to organizations and
their end-user customers, members, and/or employees ("Subscribers"). The Company
desires to engage IKANO to provide IP based products and services on the terms
set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. SERVICES. Subject to payment of all applicable fees, IKANO shall
use commercially reasonable efforts to develop, provide, and maintain the IP
based products and services (the "Services") described in the Statement of Work
attached to this Agreement as SCHEDULE A (the "Statement of Work"). The
Statement of Work, including any schedules, specifications, timelines, and
requirements included therein, is hereby incorporated into and made a part of
this Agreement. The delivery of the Services will be subject to delays for
circumstances beyond IKANO's reasonable control and the continued cooperation
and timely delivery of materials and required process approvals by the Company.
The Company understands that IKANO's performance under this Agreement is
dependent in part on the Company, the Subscribers, and third parties, including
without limitation, suppliers. Accordingly, any performance to be rendered by
IKANO hereunder shall be appropriately waived or delayed to account for actions
or inactions by such third parties. The Company acknowledges that IKANO has
entered into agreements with certain underlying service provider(s) to be able
to provide aspects of the Services and agrees that IKANO may be unable to
provide such Services, or portion thereof, to the Company in the future due to
expiration of such agreement(s) or otherwise. If IKANO terminates any part of
the Service, IKANO shall use commercially reasonable efforts to find an
alternative provider of such Service.
2. ADDITIONAL SERVICES; WORK ORDERS. The Company agrees that IKANO is
responsible only for providing the identified Services and is not responsible
for providing additional services or performing tasks not specifically described
in this Agreement or the Statement of Work or otherwise agreed to in writing by
the parties subsequent to the date of this Agreement. In the event IKANO and the
Company agree that IKANO should provide additional services not included in the
original scope of the Services, then the parties shall execute a Maintenance
Agreement, a work order form (an "Order Form"), or other appropriate Addendum,
which document shall be incorporated into and made a part of this Agreement.
3. FEES AND PRICING. In consideration of the Services to be provided
by IKANO, the Company will pay the one-time, annual, and recurring fees
specified in the Statement of Work. All set-up fees shall be paid in full at
the time of execution of this Agreement. All other fees will be invoiced by
IKANO in accordance with its billing and invoicing procedures. Generally,
invoices will be sent to the Company in the first five (5) days of each month,
and due and payable within ten (10) days from the date of invoice. Any fee not
paid when due shall be subject to a late fee equal to 1.5% percent per month, or
the maximum amount permitted by law until paid in full, plus all reasonable fees
associated with collection. Upon notice of not less than forty-five (45) days,
IKANO may, at its discretion, adjust the Subscriber fees, provided, however,
that in the event of a more than eight percent (8%) increase annually in such
prices, the Company may terminate this Agreement within thirty (30) days of its
receipt of such notice. If the Company fails to object to such adjustment, then
the Company shall be deemed to have agreed to the adjustment. The Company is
responsible for payment of credit card and other payment processing fees. In
connection with offering the Services to the Subscribers, the Company is solely
responsible for all billing adjustments/credits, creditworthiness, and other
service-related requirements of its Subscribers, and IKANO shall have no
liability to Subscribers under this Agreement. The Company's payment
obligations are not contingent upon the ability to collect payments or charges
from Subscribers.
4. BUSINESS RULES PLATFORM. If necessary and within the scope of the
Services, IKANO shall perform setup and interfacing functions to enable the
Company to use IKANO's Proprietary Business Rule Platform to establish automated
subscribers account management, provisioning, and billing processes. No rights
to any intellectual property included in the Business Rules Platform are hereby
transferred to the Company.
5. MINIMUM COMMITMENT. The parties acknowledge that, in order for the
Services to be successful and to justify the expense, time, and effort to be
incurred by IKANO, the Services must be adopted by Subscribers. Therefore, the
Company agrees to the minimum Subscriber commitments set forth in the Statement
of Work. In the event these minimum commitments are not being met after the
first year, IKANO shall have the right to reevaluate the relationship and may
terminate this Agreement on thirty (30) days' written notice.
6. CUSTOMER USE AGREEMENT/ACCEPTABLE USE POLICY. At registration, each
Subscriber will be required to accept (by signing or clicking through) the terms
and conditions of a Customer Use Agreement/Acceptable Use Policy (the "CUA").
The CUA will have substantively similar terms as those set forth in IKANO's
standard policy, located at http:xxx.xxxxx.xxx/xxxxxxxxxxxxx.xxx, subject to
modification for the actual Services being purchased by the Subscriber. The CUA
will contain provisions prohibiting improper end-user activities such as
spamming; illegal/improper postings to newsgroups; and transmitting or otherwise
displaying illegal or improper information or material, including defamatory,
libelous, or obscene items. The CUA will be subject to modification by IKANO
from time to time. Subscribers who do not accept the terms and conditions of
the CUA will not be allowed to access IKANO's Internet network or use the
Services. The Company agrees to cooperate with IKANO in enforcing the CUA and
to abide by IKANO's decision to terminate any Subscriber account for violation
of the CUA. IKANO reserves the right to take any and all additional actions it
may deem appropriate with respect to Subscribers who violate the CUA, including,
without limitation, taking action to recover the costs and expenses of
identifying offenders and excluding them from the Services, and levying
cancellation charges and penalties.
7. WARRANTIES; LIMITATIONS ON LIABILITY.
7.1 IKANO Warranties. In order to support the Services during the term
of this Agreement, IKANO shall operate and maintain its Internet network in
accordance with generally accepted and customary industry standards and the
attached Statement of Work. IKANO shall use commercially reasonable efforts to
monitor and enforce performance obligations of third party vendors and network
providers. The Company understands that IKANO may, from time to time, need to
interrupt the Services for maintenance and other operations reasons, and that
the Company shall not receive any compensation for such operations. IKANO MAKES
NO OTHER WARRANTIES, EXPRESS OR IMPLIED, AND SPECIFICALLY DISCLAIMS ANY WARRANTY
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL IKANO
BE LIABLE TO THE COMPANY OR ANY THIRD PARTY (INCLUDING BUT NOT LIMITED TO
SUBSCRIBERS) FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES, INCLUDING LOSS OF DATA, REVENUE OR ANTICIPATED PROFITS OR LOST
BUSINESS, EVEN IF IKANO IS NOTIFIED IN ADVANCE OF SUCH POSSIBILITY.
7.2 The Internet.The Company acknowledges and agrees that, except for
the Services, IKANO (and IKANO's suppliers) do not operate or control the
Internet and that (i) viruses, worms, trojan horses, or other undesirable data
or software; or (ii) unauthorized users (e.g. hackers) may attempt to obtain
access to the Company's or its Subscribers' data, website, computers, or
networks. IKANO uses what it believes to be reasonable efforts to protect
itself, its customers, and any end-users from such unauthorized use, but IKANO
is not responsible for failures resulting from the unauthorized acts of third
parties. In the event that IKANO is providing filtering as part of the
Services, the Company acknowledges that filtering is provided only on a
"reasonable efforts" basis and that while filtering may block much objectionable
content, some objectionable content may pass through to Subscribers.
8. TERM OF AGREEMENT.The initial term of this Agreement shall be for a
period of one (1) year from the effective date. The term of any Work Order
shall be as set forth therein. Thereafter, this Agreement shall automatically
renew on a year-to-year basis unless either party provides notice to the other
party of its intent not to renew this Agreement at least sixty (60) days prior
to the end of the initial or any renewal term. There shall be no additional
set-up fee in connection with any renewal of this Agreement, but the recurring
fees shall continue, subject to adjustments to reflect IKANO's then current
pricing structure. Notwithstanding any expiration or termination of this
Agreement the Company shall continue to pay for any Services provided to its
Subscribers until the Services are terminated or other arrangements are made.
The applicable provisions of sections 3, 6, 7, 10, 11, 12, 13 and 15.10 shall
survive the cancellation, termination or expiration of this Agreement. Any
other provisions, or parts thereof, which by their nature, should survive
cancellation, termination, or expiration shall also survive.
9. TERMINATION.
9.1 Termination for Breach or Insolvency. Either party may terminate
this Agreement on thirty (30) days written notice of a material breach by the
other party, unless such breach is cured within such period. Notwithstanding the
foregoing notice provision, either party may terminate this Agreement
immediately on written notice if the other party (i) ceases to do business or is
unable to pay debts as they mature in the normal course or business; (ii)
becomes or is declared insolvent or bankrupt by a court or tribunal of competent
jurisdiction; (iii) is the subject of any proceeding arising out of its
bankruptcy, liquidation, or insolvency (whether voluntary or involuntary) which
is not dismissed within ninety (90) calendar days; or (iv) makes an assignment
for the benefit of creditors.On any termination, the non-breaching party may
recover from the other party all costs and expenses incurred by the
non-breaching party in connection with the breach (subject to Section 7),
including reasonable attorneys' fees, whether such costs and expenses are
incurred with or without arbitration or other proceedings or before or after
judgment. The non-breaching party may retain all subscribers and related
information, including customer information, credit card information and billing
information, and may continue to provide services to and xxxx such subscribers
in the ordinary course of business.
9.2 Additional Termination Rights. IKANO may also terminate or suspend
Services to the Company or to any Subscriber at any time without notice in order
to: (i) prevent damages to or degradation of its Internet network integrity
which may be caused by the Company or its Subscriber(s); or (ii) to comply with
any law, regulation, court order, or other governmental request order which
requires immediate action. IKANO will use commercially reasonable efforts to:
(a) minimize the effect of such termination or suspension; and (b) notify the
Company of the reason(s) for such termination or suspension as soon as
reasonably practicable after such termination or suspension. After ten (10)
business days of nonpayment from any due date, IKANO may suspend Services.
After fifteen (15) days of nonpayment from any due date, IKANO may terminate the
Services and/or this Agreement. The Company shall remain responsible for all
charges to the Company which accrued prior to the date of termination.
10. IKANO INTELLECTUAL PROPERTY RIGHTS. The Company may offer the
Services to its Subscribers under the Company's own brand or private label. The
Company understands IKANO has developed templates and layouts to permit such
branding. These templates and layouts shall remain and continue to be the
property of IKANO and no ownership or right in such templates or layouts shall
be transferred to the Company. No title to or ownership of any of IKANO's (i)
software products, scripts, programming code, data, information or HTML script;
(ii) Internet and data communications services; (iii) network and
infrastructure; (iv) proprietary Business Rules Platform; and (v) other products
and services, including any trade secrets, know-how, methodologies and processes
related to any of the foregoing (collectively the "IKANO Products") is
transferred to the Company or its Subscribers. IKANO, or the entities from
which IKANO has obtained the rights to distribute such IKANO Products, shall
retain all rights of title and ownership in all of the intellectual property
subsisting in such IKANO Products. No right or license to any intellectual
property rights associated with the IKANO Products shall be implied and the
Company shall not reverse engineer, reverse compile, or disassemble any software
code included in the IKANO Products. In the event this Agreement is terminated
as a result of a breach by the Company, all web pages and other creative work
developed for the Services shall remain the property of IKANO.
11. COMPANY CONTENT AND INTELLECTUAL PROPERTY RIGHTS. The Services may
be branded with such name, logos, marks, and/or other identifying content as
provided and approved by the Company ("Company Content"). Company Content shall
include any materials provided by the Company for incorporation into the
Services, including but not limited to any images, photographs, illustrations,
graphics, audio clips, video clips or text. The Company shall deliver the
Company Content to IKANO in an electronic file format specified and accessible
by IKANO. Except as expressly provided in the Statement of Work, any services
required to convert or input Company Content shall be charged as additional
services. The Company Content will remain the intellectual property of the
Company or any licensee, as applicable. The Company is solely responsible for
acquiring any authorization(s) necessary for display of any Company Content or
for any hypertext links to third party websites; for verifying the accuracy of
any Company Content; and for ensuring that the Company Content does not infringe
or violate any rights of any third party. The Company Content shall not contain
any materials which are obscene, threatening, or malicious; which infringe on or
violate any applicable law or regulation or any proprietary, contract, moral,
privacy or other third party right; or which otherwise expose IKANO to civil or
criminal liability. The Company will indemnify and hold IKANO harmless for any
allegations of misuse of such material resulting from the Company's failure to
obtain such necessary permissions and licenses or any other violation of third
party rights caused by use of the Company Content. No title to or ownership of
any of the Company Content will be transferred to IKANO.
12. CONFIDENTIAL INFORMATION. All information or data related to one
party's business that is designated as confidential or that, by the nature of
the information or the circumstances surrounding its disclosure, should in good
faith be treated as proprietary or confidential shall be "Confidential
Information" and shall remain the property of the disclosing party. Each party
shall use commercially reasonable efforts to protect the confidentiality of all
Confidential Information and shall allow the disclosure of such information
within its own organization only on a need-to-know basis and only to individuals
who have agreed to maintain the confidentiality of such Confidential
Information. If the recipient reproduces any part of such information for
permitted use within its own organization, the recipient shall indicate the
disclosing party's proprietary interest on all such reproductions. If any such
information is to be transferred to the Company's or IKANO's vendors, suppliers
or customers, such information and such transfer must be authorized in writing
by the disclosing party. The obligation to keep information confidential shall
survive termination or expiration of this Agreement. Notwithstanding the
foregoing, neither party shall be bound by the confidentiality obligations
hereof with respect to information which (i) was in the public domain at the
time of disclosure; (ii) becomes publicly available through no fault of the
recipient; (iii) was in the recipient's possession, free of any obligation of
confidence, at the time of receipt of the information from the other party; (iv)
was independently developed by employees or agents of the recipient, without
reverse engineering barred by this Agreement or applicable law, and without
reference to any of the information disclosed in confidence; (v) is such that
the recipient is obligated to produce the information under court or government
action after all reasonable appeals have been exhausted; or (vi) is such that
the recipient is obligated to include such information in documents filed with
the Securities and Exchange Commission or other regulatory agency pursuant to
applicable securities laws. Notwithstanding the foregoing, IKANO may use the
name of and identify the Company as an IKANO client in advertising, publicity,
or similar materials distributed by IKANO or provided to prospective clients.
Such use shall be predicated on obtaining prior written permission on a
case-by-case basis.
13. ARBITRATION. Any dispute arising out of or relating to this
Agreement shall be settled by binding arbitration, conducted on a confidential
basis, under the then current Commercial Arbitration Rules of the American
Arbitration Association (the "Association") strictly in accordance with the
terms of this Agreement and the substantive law of the State of Utah. The
arbitration shall be held at a mutually agreeable location in Salt Lake City,
Utah and conducted by one (1) arbitrator chosen from a list of attorneys or
judges who are members of the Association's commercial arbitration panel and are
knowledgeable about the software and electronic commerce industries within
thirty (30) days of the dispute. If the parties cannot within thirty (30) days
after the expiration of such thirty (30) day period, agree on the selection of
the arbitrator, the arbitrator will be chosen pursuant to the Commercial
Arbitration Rules of the Association. The costs of the arbitration, including
the fees to be paid to the arbitrator, shall be shared equally by the parties to
the dispute. The judgment upon the award rendered by the arbitrator may be
entered and enforced in any court of competent jurisdiction. Neither party shall
be precluded hereby from seeking equitable remedies in any court having
jurisdiction hereof including, but not limited to, temporary restraining orders
and preliminary injunctions, to protect its rights and interest, but such shall
not be sought as a means to avoid or stay arbitration. The arbitrator shall not
award any consequential, incidental punitive or exemplary damages. The parties
acknowledge that they have voluntarily agreed to arbitrate their disputes in
accordance with the foregoing and each party hereby irrevocably waives any
damages in excess of compensatory damages.
14. NOTICES. All demands, notices, and other communications to be
given hereunder, if any, shall be in writing and shall be sufficient for all
purposes if personally delivered, sent by facsimile, sent by
nationally-recognized courier service, or if sent by registered or certified
United States mail, return receipt requested, postage prepaid, and addressed to
the respective party at the address set forth below (or at such other address as
may from time to time be designated by such party in writing as herein
provided):
a. If to the Company:
GTC Telecom
Attn. Legal Department
0000 Xxxxxx Xxx., Xxxxx X-0
Xxxxx Xxxx, Xxxxxxxxxx 00000
Fax: 000 0000000
b. If to IKANO:
IKANO Communications, Inc.
Attention: Legal Department
000 Xxxx 000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Fax: 000 000 0000
If personally delivered, notice under this Agreement shall be deemed to have
been given and received and shall be effective when personally delivered.
Notice by facsimile and nationally recognized courier service shall be deemed to
have been given when received. Notice by mail shall be deemed effective and
complete two (2) days after deposit in the United States mail.
15. MISCELLANEOUS PROVISIONS.
15.1 No Partnership or Third Party Beneficiaries. Nothing in this
Agreement shall be construed to constitute a partnership between the parties
hereto, and the parties expressly agree that no such partnership is intended.
Neither party shall have the right to bind or obligate the other party. No
person or entity other than the parties hereto shall have, is deemed to have or
claim any third party, direct or indirect benefits, rights or claims to this
Agreement or the matters described herein.
15.2. Assignment; Binding Agreement Except as set forth herein,
neither party shall assign this Agreement, or any of the rights and obligations
hereunder, to any other person without the express written consent of the other
party, provided, however, that either party may assign its rights and
obligations to (i) a company, partnership or other business entity wholly
controlled or owned by the party; (ii) an affiliated entity in which the
assigning party holds or owns a controlling interest (defined as the power to
vote not less than fifty percent of such person's voting securities or ownership
interest); (iii) a purchaser of all or substantially all of the assets of the
assigning party's business; or (iv) a company into which the party's company is
merged or consolidated, provided that notice of any such assignment is promptly
given to the nonassigning party. This Agreement shall be binding upon and inure
to the benefit of the respective parties hereto, their heirs, legal
representatives, successors, and assigns.
15.3. Entire Agreement. This Agreement, together with the Statement of
Work and any other schedule, addendum, or exhibit expressly incorporated herein,
contains the entire agreement between the parties. No promise, representation,
warranty, or covenant not included in this Agreement has been or is relied upon
by either party. Any prior negotiations, correspondence, or understandings
related to the subject matter of this Agreement shall be deemed to be merged in
this Agreement and shall be of no further force or effect. Each party has
relied upon such party's own examination of the full Agreement and the
provisions thereof, and the representations and covenants expressly contained in
this Agreement itself. The failure or refusal of either party to inspect the
Agreement or other documents, or to obtain legal advice or other advice relevant
to this transaction, constitutes a waiver of any objection, contention, or claim
that might have been based upon such reading, inspection, or advice. No
modification addendum or amendment of this Agreement shall be of any force or
effect unless in writing executed by all of the parties.
15.4. Interpretation. Unless otherwise provided, all terms shall have
the meaning given them in the ordinary English usage and as customarily used.
Words in any gender shall include both other genders. Whenever the context
requires, the singular shall include the plural, the plural shall include the
singular, and the whole shall include any part thereof.
15.5. Invalidity. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect the other provisions hereof, and
the Agreement shall be construed in all respects as if such invalid provisions
were omitted.
15.6. Headings. The paragraph and other headings contained in this
Agreement are for purposes of reference only and shall not limit, expand, or
otherwise affect the construction of any of the provisions of this Agreement.
15.7. Counterparts; Facsimile Signature. This Agreement may be
executed in any number of counterparts, each of which when executed and
delivered shall be deemed to be an original, and all of which shall together
constitute one and the same instrument. The parties hereto agree that
transmission to the other party of this Agreement with its facsimile signatures
shall bind the party transmitting this Agreement by facsimile in the same manner
as if such party's original signature had been delivered.
15.8. No Waiver. Acceptance by either party of any performance less
than required hereby shall not be deemed to be a waiver of such party to enforce
all of the terms and conditions hereof. No waiver of any such right hereunder
shall be binding unless reduced to writing and signed by the party to be charged
therewith.
15.9. Authorized Execution. The individuals signing below each
represents and warrants (i) that he or she is authorized to execute this
Agreement for and on behalf of the party for whom he or she is signing, (ii)
that such party shall be bound in all respects hereby, and (iii) that such
execution presents no conflict with any other agreement of such party.
15.10. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Utah as applied to
agreements made and wholly performable in Utah between Utah residents.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
IKANO COMMUNICATIONS, INC. GTC TELECOM CORP.
By /s/ Xxx Xxxx By /s/ S. Xxxx Xxxxxx
Name Xxx Xxxx Name S. Xxxx Xxxxxx
Title Vice-President of Sales Title CEO
