Exhibit 10.13
Note: Certain material, indicated by three asterisks (***), has been omitted
from this document pursuant to a request for confidential treatment
filed with the Securities and Exchange Commission. The omitted
material has been filed separately with the Securities and Exchange
Commission.
[LOGO]
WHOLESALE USAGE AGREEMENT
PSINet Inc. Purchaser: Rocky Mountain
510 Huntmar Park Drive Address: Internet, Inc.
Xxxxxxx, XX 00000 0000 00xx Xx.
Xxxxx 0000
Xxxxxx, XX 00000
Phone:000.000.0000 Phone: 303. 672.0706
Facsimile:703.397.5318 Facsimile: 303. 672.0711
xxxx@xxx.xxx Electronic Mail: xxxxx@xxx.xxx
Business Contact: Xxxxx Xxxxxxxxx Business Contact: Xxxxx Loud
Title: Regional Sales Manager Title: VP, Operations
Phone: 703.904.4100 x1375
Technical Contact: Xxx Xxxxxx Technical Contact: Xxxxxxx Xxxxxxx
Title: ISP Support Engineer
Phone: 000.000.0000 Title: Vice President
Phone: 303. 672.0727
Fax 303. 672.0711
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THIS AGREEMENT is made by and between PSINet Inc., a corporation incorporated
under the laws of the State of New York, ("PSINet") and Rocky Mountain Internet,
Inc. ("Retailer") in order for Retailer to obtain from PSINet access to the
PSINet's network and the Internet for the benefit of Retailer's individual
customers desiring dialup or "switched" network access ("Access") as further
described below. In consideration of the mutual promises and covenants contained
herein, the parties agree, intending to be legally bound, as follows:
1. Definitions. The following terms shall have the following meanings for
purposes of this Agreement:
1.1 "Authorized User" shall mean any person authorized by a Subscriber to
have an account on a Host. Retailer may not permit any person or entity
other than an Authorized User to Access to the Network, except with the
written consent of PSINet. No person may be authorized to use the Network by
means of a connection between a Host owned or leased by a Subscriber and a
Host owned or leased by a person other than a Subscriber.
1.2 "Effective Date" of this Agreement is the date accompanying the last
party to sign's signature.
1.3 "Forecast" shall be the four (4) month rolling forecast Retailer
provides to PSINet on a monthly basis of the estimated number of Subscribers
that will be served by each POP.
1.4 "Host" shall mean a computer with a network (or IP) address.
1.5 "Xxxx" is any name, logo, trade name, trademark, copyright, service xxxx
or other intellectual property right owned by PSINet or its Retailer.
1.6 "Network" shall mean the combination of computer hardware, computer
software programs and data transmission facilities operated by PSINet (or
its duly authorized subcontractors) which will permit computers operated by
Subscribers to communicate with computers at remote locations which are
operated by others via the TCP/IP communications protocol and to provide
access to Internet.
1.7 "POP" shall mean a Network point-of-presence where PSINet equipment will
be located and these POPs will be positioned throughout the world in order
to provide Authorized Users Access via telephone calls.
1.8 "Subscriber" shall mean any individual person authorized by Retailer to
have Access to the Network, although this Access is not to be used with
Local Area Network (LAN) applications. Retailer may not permit any entity
other than a Subscriber to have Access to the Network, except with the
written consent of PSINet.
2. PSINet Obligations.
2.1 General. PSINet agrees to provide Retailer with Access for Subscribers
to the Network and the Internet. The fees to be paid by Retailer to PSINet
for such Access services are set forth below in Section 4.
2.2 Provision of Access. Throughout the term of this Agreement, PSINet shall
provide Subscribers with Access at the levels then provided and supported by
PSINet. A recent estimated listing of Network POPs can be retrieved through
access to PSINet's world-wide web site at 'xxxx://xxx.xxx.xxx'. PSINet
reserves the right to install new POPs and/or to close existing POPs as it,
in its sole discretion, deems appropriate. In the event PSINet deems it
necessary to close an existing POP, PSINet shall provide Retailer with sixty
(60) days written notice thereof. Retailer may order such Access on behalf
of its present or future Subscribers and there shall be no limit on the
number of Subscribers who may use the Network; provided, however, that
PSINet may refuse service to Retailer because there is insufficient capacity
on the Network or in the POP to provide the Access amount requested. In the
event PSINet determines there to be such lack of capacity, then the
provisions of Section 4.10 herein do not apply to the effected POP during
any month for which such insufficient capacity occurs.
2.3 ISDN Service. PSINet shall also make ISDN 64k and 128k Internet
connection services available to Retailer for Subscribers. The fees to be
paid by Retailer for such services are set forth below.
2.4 Quality of Service. PSINet shall provide to Retailer (for its
Subscribers) Internet connection services that meet reasonable commercial
standards, including, but not limited to, accessibility, latency, packet
loss, and throughput. PSINet shall keep and maintain its Network in good
condition and repair. The Network shall be properly maintained, serviced and
upgraded by PSINet as it, in its sole discretion, shall determine is
necessary in order to ensure connectivity to Subscribers. ***
2.5 Reports and Information Regarding Service.
2.5.1 Access to Network Monitoring Systems. PSINet shall provide
Retailer with read-only access to all applicable network monitoring
systems used by PSINet to monitor the Network.
2.5.2 PSINet Network Outages. PSINet shall provide to Retailer prompt
notification of any Network outages that affect Subscribers. When
possible, at least three days in advance notice of planned outages shall
be given to Retailer so that Subscribers may be alerted.
2.6 PSINet Technical Support. PSINet agrees to provide Retailer, at no
additional charge, reasonable back-end technical support and problem
escalation support for Access and Network problems. However, PSINet is not
obligated to provide technical support and problem escalation support to
Subscribers.
2.7 Termination of Access. PSINet shall terminate the Access rights of any
Subscriber as soon as is reasonably practicable upon written notice from
Retailer to do so or upon mutually agreed upon electronic process with
receipt confirmed, but shall have no liability in connection therewith.
Further, Retailer and its Subscribers are required to comply with PSINet's
Net-Abuse Policy ("Policy") as currently set forth on PSINet's Web site
(xxxx://xxx.xxx.xxx) and as the Policy may be modified by PSINet in its sole
discretion from time to time. Any content, material, message, or data made
available or transmitted through the Network, wherever it is sent from,
viewed, received, or retrieved, that is in violation of (i) any local,
state, federal or international law, regulation or treaty; (ii) the Policy;
or (iii) any community standard or accepted Internet policy is prohibited.
In the event of violation of the foregoing by any Subscriber, PSINet will
advise Retailer accordingly, and PSINet reserves the right, in its sole
discretion, to terminate such Subscribers Access immediately with written
notice to Retailer. In the event of violation of the foregoing by Retailer,
PSINet may deem such violation a material breach of this Agreement and may,
in its sole discretion, terminate this Agreement with written notice to
Retailer, but without the cure period specified in Section 5 below.
3. Retailer Obligations.
3.1 Retailer Responsibility for Its Subscribers. Retailer shall be
responsible for all customer support, pricing and service plans, billing and
collections with respect to its own Subscribers.
3.2 Retailer Connection to the Network. Retailer shall provide, at its own
expense, the telecommunications circuit for its connection to the Network
which shall run between the best suited PSINet POP (as determined by
PSINet) and the Retailer's operations center (which includes the local
telephone company or Competitive Access Provider circuits). In addition,
Retailer shall provide an estimate of the traffic it anticipates between
Retailer's network and PSINet's Network.
3.3 Subscriber Equipment. PSINet shall not be responsible for the
installation, operation or maintenance of any computer equipment or computer
software programs provided by Retailer or any Subscriber.
3.4 Optional Peering. In addition to the connection of Retailer's network
and PSINet's Network as set forth in Section 3.2, Retailer may, but shall
not be obligated to, provide telecommunications circuits interconnecting
Retailer's network with the Network at a location or locations agreed upon
by the parties. ***
3.5 Use of Marks. Neither party is authorized through this Agreement to use
the other party's Marks in connection with their sales, advertisements and
promotion of its services to Subscribers, except in materials either
provided or approved by the authorized user of the xxxx xxxxx to it's use.
Each party shall send to the other party a copy of any printed material
using the other party's Xxxx or other copyrighted material, and the
authorized party shall have the right to disapprove such use (although
approval shall not be unreasonably withheld). Upon termination of this
Agreement, each party shall cease to use any of such Marks or copyrighted
material and shall, within a reasonable time agreeable to the authorized
party, remove any reference to authorized party from its advertising and
promotional material.
3.6 Traffic Forecast. Retailer shall work closely with their distributors
and PSINet to make their best efforts in predicting product demand in their
geographic markets and implement a forecasting model based on trending and
previous sales for the purpose of allowing PSINet to adequately provide
facilities for the increased demand. ***
4. Price and Pricing Terms.
Advanced Payment. Retailer agrees to pay to PSINet in advance of Retailer's
first Subscriber subscribing to the Network a one-time, non-refundable fee of
***. This fee shall be applied to future, monthly Base Charge payments after the
third full month following the Effective Date of this Agreement.
4.2 Base Charge. Upon the Effective Date, and on the first day of each month
thereafter throughout the initial or any successive terms of this Agreement,
Retailer agrees to pay PSINet for each Subscriber who is then or was at any
time during the immediately preceding month authorized to use the Network a
Base Charge pursuant to the following schedule and subject to adjustments as
provided below:
Total # of Subscribers Applicable Base Charge
---------------------- ----------------------
using the Network
----------------------
***
150,001 or more Additional Adjustment
Additional ISDN Charges:
------------------------
***
* in one-minute increments rounded upwards
**ISDN pricing will be in addition to the applicable Base Charges
The applicable Base Charge above is to be applied to all Subscribers
irrespective of the rate that previously was applied to that group of
Subscribers. For example, if there are a sufficient number of Subscribers to
satisfy the second-tier pricing requirement, the applicable Base Charge shall
apply to all Subscriber Base Charges. Should the amount of Subscribers
subsequently fall below such tier, incurring a higher Base Charge, the
applicable Base Charge shall be adjusted to the higher Base Charge for all
Subscribers as indicated in this section.
The payment to be made for the initial month of Access for any Subscriber shall
include (i) an amount equal to the applicable Base Charge for such initial
month, prorated in the case of a partial month, and (ii) an amount equal to such
Base Charge as payment in advance for the next month of Access. If one of the
Subscribers cancels service within any month, there will either be no charge or
a pro-rated charge depending upon the time of that Subscriber's service
cancellation within that month.
4.3 Adjustments to Base Charge.
4.3.1 International Charges. Retailer and its Subscribers may also have
Access from any PSINet POP in Canada for an additional fee of *** US per
hour added to the Base Charge (calculated in one minute increments
rounded upward), and from any PSINet POP outside of the US and Canada for an
additional fee of *** US per hour added to the Base Charge (calculated in
one minute increments rounded upward).
4.3.2 "Toll-Free" Charges. Retailer and its Subscribers may also access the
Network using a "toll free" PSINet POP (for example, using an 800 or 888
number) within the contiguous 48 states of the United States for an
additional fee of *** US per hour added to the Base Charge (calculated in
one minute increments rounded upward).
4.3.3 Additional Adjustment. Once the number of Subscribers using the
Network exceeds 150,000, the parties will negotiate in good faith to agree
upon an appropriate adjustment to the applicable Base Charge.
4.4 Minimum Commitment.
4.4.1 Ramp Period. The initial ***months from the Effective Date hereinafter
defines the "Ramp Period". The minimum number of Subscribers on a monthly
basis during the Ramp Period shall be projected as follows:
***
PSINet and Retailer agree that these numbers will serve as a gauge of the
success of the program during the Ramp Period.
4.4.2 Minimum Amounts. The minimum monthly revenue from Retailer for Access
provided by PSINet for Subscribers pursuant to this Agreement shall be ***
US after the Ramp Period mentioned above. In the event PSINet's gross
revenues from Retailer in any month thereafter shall be less than the
required minimum, Retailer, at its discretion, shall either promptly (i)
remit to PSINet an amount equal to the difference between the aforesaid
minimum monthly revenue amount and such gross revenues; or (ii) give PSINet
the right of first refusal to purchase from Retailer all its Subscribers who
receive Access to the Network pursuant to the terms of this Agreement at the
lower of (i) the lowest rate offered by any bona fide third party purchaser
; or (ii) ***.
In the event that PSINet chooses not to purchase the Subscribers and
Retailer chooses not to remit to PSINet the amount stated above in
subparagraph (a), this Agreement shall be terminated; provided, however,
that PSINet shall continue to service, and Retailer shall continue to pay
for, the Subscribers at the highest Base Charge specified in Section 4.2
hereof for a period of *** following such failure by Retailer to provide the
minimum monthly revenue payment in order to assure a smooth transition for
said Subscribers.
4.5 Taxes. Retailer shall be liable for and shall reimburse PSINet for all
taxes and related charges however designated resulting from the transactions
contemplated hereby (except those relating to PSINet's gross income),
including federal, state, provincial or local sales, use or value-added
taxes (VAT) and excise taxes, imposed in connection with or arising from the
provision of Access.
4.6 Invoices. PSINet shall invoice Retailer monthly in advance for all
charges under this Agreement. All invoices will be payable within thirty
(30) days of date of invoice. Invoices not paid by their due date shall be
subject to a 1.5% per month interest fee, or the maximum extent allowed by
applicable laws, whichever is less, on all past-due
balances. In the event PSINet incurs additional fees as a result of any
collection activity, such as collection agencies or legal fees, Retailer
shall reimburse PSINet for all such fees. In the event Retailer shall fail
to pay PSINet any amount due under this Agreement, PSINet, in addition to
charging applicable delinquency fees, may discontinue providing Access to
Retailer and its Subscribers upon ten (10) days prior written notice by
overnight courier or certified mail to Retailer and chance to cure. PSINet
shall resume providing Access immediately upon receipt of such payment, and
in such event Retailer shall pay PSINet a reasonable reconnection fee.
4.7 Subscriber Charges. Retailer is solely responsible for establishing and
collecting its Subscriber charges for services it offers its Subscribers
through the Network and for preparing and mailing invoices to its
Subscribers. Retailer is responsible for payment of the total amounts
invoiced it by PSINet (except for any amounts disputed by Retailer in good
faith) regardless of whether Retailer is paid by its Subscribers.
5. Term/Extensions/Termination. The term of this Agreement shall be three (3)
years, commencing on the last day of the Ramp Period as defined above, and,
unless either party notifies the other in writing not less than one-hundred
eighty (180 days) prior to the end of the initial term or any extension thereof,
this Agreement shall be automatically renewed annually thereafter for a period
of one year.
Either party may terminate this Agreement if such other party has materially
breached this Agreement and has failed to cure such breach within thirty (30)
days after receiving written notice clearly specifying such breach; provided,
however, that this notice period shall not apply to a termination by PSINet in
accordance with the provisions of Section 2.7, 4.4.2 and/or 4.6.
6. Warranties Excluded. EXCEPT AS EXPRESSLY PROVIDED HEREIN, PSINET MAKES NO
WARRANTIES IN CONNECTION WITH ITS NETWORK OR THE PROVISION OF ACCESS AS
CONTEMPLATED HEREIN, WHETHER WRITTEN OR ORAL, STATUTORY, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION THE WARRANTY OF MERCHANTABILITY, THE WARRANTY OF
FITNESS FOR A PARTICULAR PURPOSE OR USE AND NON-INFRINGEMENT OF THIRD PARTY
RIGHTS. RETAILER'S SOLE AND EXCLUSIVE REMEDY SHALL BE PSINET'S OBLIGATION TO
ADJUST THE FEES PAYABLE BY RETAILER AS SET FORTH ELSEWHERE HEREIN.
7. Limitation of Liability. NOTWITHSTANDING ANYTHING CONTAINED IN THIS AGREEMENT
TO THE CONTRARY, THE PARTIES AGREE THAT PSINET SHALL IN NO EVENT BE LIABLE TO
RETAILER, ITS SUBSCRIBERS OR ANY OTHER PERSON FOR ANY ACTUAL, DIRECT, INDIRECT,
CONSEQUENTIAL, SPECIAL, INCIDENTAL, RELIANCE, PUNITIVE OR ANY OTHER DAMAGES OF
ANY KIND OR NATURE WHATSOEVER (INCLUDING, WITHOUT LIMITATION, DAMAGES FOR THE
LOSS OF DATA, GOODWILL OR PROFITS) REGARDLESS OF THE FORESEEABILITY THEREOF,
ARISING OUT OF THE PROVISION OF ACCESS OR IN ANY WAY ARISING OUT OF THIS
AGREEMENT, WHETHER IN AN ACTION ARISING OUT OF BREACH OF CONTRACT, BREACH OF
WARRANTY, DELAY, NEGLIGENCE, STRICT TORT LIABILITY, PATENT MATTERS OR ANY OTHER
THEORY. NO ACTION OR PROCEEDING AGAINST PSINET MAY BE COMMENCED MORE THAN TWO
YEARS AFTER THE SERVICES ARE RENDERED. THIS CLAUSE SHALL SURVIVE FAILURE OF AN
EXCLUSIVE REMEDY. PSINET'S TOTAL LIABILITY FOR GROSS NEGLIGENCE DURING THE
LIFETIME OF THIS AGREEMENT SHALL IN NO EVENT EXCEED ONE HUNDRED TWENTY-FIVE
THOUSAND DOLLARS ($125,000) IN THE AGGREGATE.
8. Indemnification of PSINet. RETAILER SHALL INDEMNIFY AND HOLD HARMLESS PSINET
AND PSINET'S DIRECTORS, OFFICERS, EMPLOYEES, AGENTS AND ADVISORS FROM AND
AGAINST ANY AND ALL CLAIMS OF OTHER PERSONS OR ENTITIES ARISING OUT OF MATERIAL,
DATA, INFORMATION OR OTHER CONTENT TRANSMITTED BY SUBSCRIBERS OR OTHER ACTS OR
OMISSIONS OF RETAILER AND/OR ITS SUBSCRIBERS.
9. Confidential Information. The provisions in the Bilateral Nondisclosure
Agreement executed between the parties shall apply to the terms of this
Agreement ands shall survive the execution and termination of this Agreement for
any reason.
10. Miscellaneous.
10.1 Independent Parties/No Agency. The relationship of PSINet and Retailer
shall be that of independent third parties. Except as otherwise expressly
provided in this Agreement, this Agreement does not constitute either party
as the agent or legal representative of the other party and does not create
a partnership or joint venture between the parties. Except as otherwise
expressly provided in this Agreement, neither party shall have any authority
to contract for or bind any other party in any manner whatsoever. This
Agreement confers no rights of any kind upon any third party.
10.2 Force Majeure. PSINet shall not be liable for failure to fulfill its
obligations hereunder if such failure is due to causes beyond its reasonable
control, including, without limitation, actions or failures to act of
Retailer or any Subscriber, acts of God, fire, catastrophe, governmental
prohibitions or regulations, viruses which did not result from the acts or
omissions of PSINet, its employees or agents, national emergencies,
insurrections, riots or wars, or strikes, lockouts, work stoppages or other
labor difficulties. The time for any performance required hereunder shall be
extended by the delay incurred as a result of such act of force majeure, and
PSINet shall act with diligence to correct such force majeure.
10.3 Delays or Omissions. No delay or omission to exercise any right, power
or remedy accruing to a party under this Agreement shall impair any such
right, power or remedy of such party nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of or
in any similar breach or default thereafter occurring; nor shall any waiver
of any single breach or default be deemed a waiver of any other breach or
default theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of either party of any breach
or default under this Agreement, or any waiver on the part of either party
of any provisions or conditions of this Agreement must be made in writing
and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement or by law or otherwise
afforded to a party, shall be cumulative and not alternative.
10.4 Benefit and Assignment. No party hereto shall assign this Agreement, in
whole or in part, whether by operation of law or otherwise, without the
prior written consent of the other parties hereto (which consent shall not
be unreasonably delayed or withheld); and any purported assignment in
violation of the foregoing shall be void. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns as permitted hereunder. No person or
entity other than the parties hereto is or shall be entitled to bring any
action to enforce any provision of this Agreement against any of the parties
hereto, and the covenants and agreements set forth in this Agreement shall
be solely for the benefit of, and shall be enforceable only by, the parties
hereto or their respective successors and assigns as permitted hereunder.
10.5 Additional Actions, Documents and Information. Each of the parties
hereto agrees that it will, at any time, prior to, at or after the date
hereof, take or cause to be taken such further actions, and execute, deliver
and file or cause to be executed, delivered and filed such further documents
and instruments and obtain such consents, as may be reasonably requested in
order to fully effectuate the purposes, terms and conditions of this
Agreement.
10.6 Notices.
(a) All notices and other communications required or permitted hereunder
shall be in writing and shall be mailed by certified or registered mail
(return receipt requested), express air courier, charges prepaid, or
facsimile addressed as follows:
To Retailer: as specified above.
To PSINet:
PSINet Inc. with copy to: PSINet Inc.
000 Xxxxxxx Xxxx Xxxxx 000 Xxxxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000 Xxxxxxx, Xxxxxxxx 00000
Facsimile: 703.397.5318 Facsimile: 703.904.4200
Attn: Xxxx Xxxxx, Vice President, Attn: General Counsel
Carrier & ISP Services
or to such other address as either party shall have furnished to the other
in writing.
(b) If a notice is given by either party by certified or registered mail, it
will be deemed received by the other party on the third business day
following the date on which it is deposited for mailing. If a notice is
given by either party by air express courier, it will be deemed received by
the other party on the next business day following the date on which it is
provided to the air express courier. If a notice is given by facsimile, it
will be deemed received by the other party after confirmation of receipt.
Notwithstanding the foregoing, any payments made under this Agreement shall
be deemed received only when actually received.
10.7 Compliance with Law. Retailer is responsible for complying with all
applicable rules, regulations, statutes, codes, ordinances and other
requirements, whether federal, state, provincial, local, international or
otherwise in connection with the matters contemplated by this Agreement.
10.8 Severability/Survival/Waivers. In case any provision of this Agreement
shall be invalid, illegal or unenforceable, such provision shall be
construed so as to render it enforceable and effective to the maximum
extent possible in order to effectuate the intention of this Agreement; and
if such provision shall be wholly invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions hereof
shall not in any way be affected or impaired thereby. The parties' rights and
obligations that, by their nature, would continue beyond the termination,
cancellation, or expiration of this Agreement, shall survive such
termination, cancellation or termination. The waiver or failure of either
party to exercise in any respect any right provided for in this Agreement
shall not be deemed a waiver of any further right under this Agreement.
10.9 Titles and Subtitles. The titles of the Sections of this Agreement are
for convenience of reference only and are not to be considered in construing
this Agreement.
10.10 Governing Law and Venue. Customer agrees to the non-exclusive
jurisdiction of the federal and state courts of the Commonwealth of Virginia
for any action or proceeding arising out of or in relation to this
Agreement. This Agreement shall be governed by the substantive law of the
Commonwealth of Virginia.
10.11 Entire Agreement/Amendments. This Agreement represents the complete
agreement and understanding of the parties with respect to the subject
matter herein, and supersedes any other agreement or understanding, written
or oral. In the event of any conflict arising between Customer's purchase
order terms and this Agreement, this Agreement shall take precedence. This
Agreement may be modified only in writing signed by both parties.
Both PARTIES REPRESENT AND WARRANT THAT THEY HAVE FULL CORPORATE POWER AND
AUTHORITY TO EXECUTE AND DELIVER THIS AGREEMENT AND TO PERFORM THEIR OBLIGATIONS
HEREUNDER, AND THAT THE PERSON WHOSE SIGNATURE APPEARS BELOW IS DULY AUTHORIZED
TO ENTER INTO THIS AGREEMENT ON BEHALF OF THE PARTY.
IN WITNESS WHEREOF, THE PARTIES HAVE ENTERED INTO THIS AGREEMENT AS OF THE DATE
SET FORTH:
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Authorized Retailer Representative/Title (please type or print)
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Retailer Signature Date
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Authorized PSINet Representative (please type or print)
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PSINet Representative Signature Date
