Managed Service Agreement

This Managed Service Agreement (“Agreement”) is entered into effective the date of the signed Managed Service Quote (“Effective Date”), between VAL-ED Joint Venture, L.L.P., a Minnesota limited liability partnership doing business as 702 Communications (“702”), and the organization identified as  Customer on the Managed Service Quote (“Company”).  702 and Company are sometimes referred to collectively as the “Parties” and individually as a “Party”.

RECITALS

  1. 702 Manages equipment and/or and provides Managed Services to Company.
  2. Company desires to use 702 owned equipment (the “Equipment”) in the Building for the purposes permitted under the terms of this Agreement.
  3. Company desires to use 702 managed applications, operating systems, or cloud applications(“Software”) for the purposes permitted under the terms of this Agreement.
  4. 702 Equipment location in the Building is the demarc and applications, operating systems, or cloud applications supported by 702 (the “Managed Services Space”).
  5. 702 is willing to permit the location of the Equipment, and to provide certain limited services, on the terms and conditions stated herein.

NOW, THEREFORE, in consideration of the recitals, the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

  1. TERM AND EXTENSIONS. The initial term of this Agreement shall commence on [ModifyDate!MMMM dd, yyyy] and continue to a [QuoteFinancingList.Name] (the “Initial Term”). After the Initial Term, this Agreement shall automatically be renewed upon the same terms and conditions (except for adjustment to fees and charges as stated in the Agreement Fees – Exhibit A) for successive one (1) year terms (each a “Renewal Term”), unless terminated by either Party upon written notice provided not less than sixty (60) days prior to the expiration of the Initial Term or subsequent Renewal Term, whichever is applicable. The Initial Term and the Renewal Term are referred to collectively as the “Term”.
  2. TERMINATION ON DEFAULT. Either Party (the “Non-Default Party”) may terminate this Agreement due to a material breach of this Agreement by the other Party (the “Defaulting Party”), provided (a) the Non Defaulting Party provides the Defaulting Party with written notice of such breach and (b) the Defaulting Party fails to cure such breach within thirty (30) days of its receipt of such notice, or such other period of time as many be mutually agreed upon in writing by the Parties.
  3. MANAGED SERVICE COVERAGE. Support of the Equipment, applications, operating systems, or cloud applications in Appendix A will be provided to the Customer by 702 through remote and if necessary on-site means between the hours of 8:00 am – 5:00 pm Monday through Friday, excluding public holidays. Network Monitoring Services will be provided 24/7/365. All services qualifying under these conditions, as well as Services that fall outside this scope will fall under the provisions of Appendix A.

3.1. Suitability of Existing Environment – Minimum Standards Required for Services.  In order for Customer’s existing environment to qualify for Service Provider’s Managed Services, the following requirements must be met:

  • All Servers with Microsoft Windows Operating Systems must be running Windows 2012 Server or later and have all the latest Microsoft Service Packs and Critical Updates installed
  • All Desktop PC’s and Notebooks/Laptops with Microsoft Windows Operating Systems must be running Windows 8 or later and have all of the latest Microsoft Service Packs and Critical Updates installed.
  • All Server and Desktop Software must be Genuine, Licensed and Vendor-Supported.
  • The environment must have a currently licensed, up-to-date and Vendor-Supported Server-based Antivirus Solution protecting all Servers, Desktops, Notebooks/Laptops, and Email.
  • The environment must have a currently licensed, Vendor-Supported Server-based Backup Solution that can be monitored and send notifications on job failures and successes.
  • All Wireless corporate data traffic in the environment must be securely encrypted.
  • There must be an outside static IP address assigned to a network device, allowing RDP or VPN access.

**Note: Unless otherwise specified, costs required to bring Customer’s environment up to these Minimum Standards are not included in this Agreement.

3.2. Excluded Services . Unless otherwise specified, service rendered under this Agreement does not include:

  • Parts, equipment or software not covered by vendor/manufacturer warranty or support
  • The cost of any parts, equipment, or shipping charges of any kind.
  • The cost of any Software, Licensing, or Software Renewal or Upgrade Fees of any kind.
  • The cost of any 3rd Party Vendor or Manufacturer Support or Incident Fees of any kind.
  • The cost to bring Customer’s environment up to minimum standards required for Services.
  • The cost to recover data incurred due to viruses, malware or any other breach of security.
  • Failure due to acts of God, building modifications, power failures or other adverse environmental conditions or factors.
  • Service and repair made necessary by the alteration or modification of equipment other than that authorized by Service Provider, including alterations, software installations or modifications of equipment made by Customer’s employees or anyone other than Service Provider.
  • Maintenance of Applications software packages, whether acquired from Service Provider or any other source unless as specified in Appendix B.
  • Programming (modification of software code) and program (software) maintenance unless as specified in Appendix B.
  • Training Services of any kind.
  1. MANAGED SERVICE LICENSE OF EQUIPMENT. Throughout the Term, 702 grants to Company a license to use specific equipment in the Building as shown or described in Exhibit B-2 (the “Equipment”). Company shall not replace or add Equipment, or change the location of Equipment, or change or modify the Managed Service Equipment in any way, without 702’s prior written consent.  During the term of any Order for Hardware Services, and subject to any limitations set forth therein, 702 Communications agrees to license to Customer, at Customer’s designated facility(-ies) such hardware or other equipment as may be designated in such Order as “Hardware-as-a-Service or HaaS” All Licensed Equipment shall be delivered, installed and maintained by 702 Communications. Title to the Licensed Equipment shall remain with 702 Communications or its suppliers. Customer shall have no right or interest in or to the Licensed Equipment except as expressly provided in this Agreement and shall possess the Licensed Equipment subject and subordinate to the rights of 702 Communications. Customer will, at its own expense, keep the Licensed Equipment free and clear from any liens or encumbrances of any kind (except any caused by 702 Communications) and will indemnify and hold 702 Communications harmless from and against any loss or expense caused by Customer’s failure to do so. Customer shall give 702 Communications immediate written notice of any attachment or process affecting the Licensed Equipment or title thereof.
  2. MANAGED SERVICE LICENSE OF SOFTWARE OR CLOUD SERVICE. Throughout the Term, 702 grants to Company a license to use specific as shown or described in Exhibit B-3 (the “Software”).  Company shall not replace or add Software, or change the location of Software, or change or modify the Software in any way, without 702’s prior written consent.  During the term of any Order for Software Services, and subject to any limitations set forth therein, 702 Communications agrees to license to Customer,  such application, operating system or cloud service as may be designated in such Order as “Software-as-a-Service or SaaS” All Licensed Software shall be delivered, installed and maintained by 702 Communications. Title to the Licensed Software shall remain with 702 Communications or its suppliers. Customer shall have no right or interest in or to the Licensed software except as expressly provided in this Agreement and shall possess the Licensed Software subject and subordinate to the rights of 702 Communications. Customer will, at its own expense, keep the Licensed Software free and clear from any liens or encumbrances of any kind (except any caused by 702 Communications) and will indemnify and hold 702 Communications harmless from and against any loss or expense caused by Customer’s failure to do so. Customer shall give 702 Communications immediate written notice of any attachment or process affecting the Licensed Software or title thereof.
  3. MANAGED SERVICE FEES. Company shall pay 702 the monthly recurring charges (MRC), non-recurring charges (NRC), and utility service charges identified in Exhibit A until the expiration or termination of this Agreement and the removal of all Equipment.
  4. BILLING AND PAYMENT TERMS. 702 shall invoice Company monthly in advance for the applicable fees, charges, and expenses detailed in Exhibit A. Company will pay each invoice within fifteen (15) days of the date of the invoice (“Due Date”). Payments received by 702 after the Due Date may accrue interest at the rate of 1.5% per month, or the highest rate permitted under applicable law.

7.1. If Company in good faith disputes any amount invoiced, Company must notify 702 in writing of the dispute prior to the Due Date or the right to dispute shall be waived.

7.2. The number of devices is the number at the time of Agreement signing. The number of devices will be adjusted once a month to reflect any changes in the number of devices covered. As the number of devices increases or decreases service fees will increase or decrease by price per month, per device, by device type at the amount listed in the table above. These increases and decreases will occur automatically and do not require amendment to this agreement

  1. ACCESS. Access is not permitted to any of the 702 Equipment unless with prior consent of 702, which consent shall not be unreasonably withheld or delayed, and is subject to compliance with Exhibit C – Managed Service Access and Security Policies and Procedures. 702’s access and security requirements as of the Effective Date are stated in Exhibit C and may be modified by 702 from time to time.
  2. EQUIPMENT INSTALLATION; MAINTENANCE. 702 shall install the Software in the defined Managed Services Hardware or Cloud. 702 shall be responsible, at its sole cost and expense, for any and all repairs, maintenance or adjustments to its Software.  The Software shall be installed, maintained and operated in the Managed Service Hardware or cloud by authorized and qualified technicians of 702, or its designee.
  3. REMOVAL OF EQUIPMENT ON TERMINATION. On termination or expiration of this Agreement, 702 shall within thirty (30) days remove 702 Software, including but not limited to applications, operating systems and cloud services. Company’s obligations under this section shall survive the expiration or earlier termination of this Agreement
  4. SOFTWARE INSTALLATION; MAINTENANCE. 702 shall install the Equipment in the Building in the defined Managed Services Space.  702 shall be responsible, at its sole cost and expense, for any and all repairs, maintenance or adjustments to its Equipment. 702’s Equipment shall be placed, maintained, relocated or removed in accordance with the applicable requirements and specifications of National Electrical Code (NEC), the National Electrical Safety Code (NESC), and rules and regulations of the Occupational Safety and Health Act (OSHA) and the Environmental Protection Agency (EPA), and any governmental authority with jurisdiction, including state and local counterparts of OSHA and EPA.  The Equipment shall be installed, maintained and operated in the Managed Service Space by authorized and qualified technicians of 702, or its designee.
  5. REMOVAL OF SOFTWARE ON TERMINATION. On termination or expiration of this Agreement, 702 shall within thirty (30) days remove 702 Equipment, including but not limited to electrical boxes, wiring and electronics.  Company may request to pay 702 the costs to restore Company’s equipment that was removed at installation of 702 Equipment. Company’s obligations under this section shall survive the expiration or earlier termination of this Agreement
  6. NOTICES OF WORK AFFECTING EQUIPMENT. 702 agrees to use commercially reasonable efforts to notify Company prior to the commencement of any non-emergency work or activity to be performed by 702 which may reasonably be expected to adversely and materially affect the operation of Company’s network.
  7. PROPRIETARY INFORMATION. Neither Party shall disclose the terms and conditions of this Agreement to any person or entity, without the prior written consent of the other Party, unless ordered or required by a Federal, State or local governmental authority. In addition, neither Party shall disclose to any person or entity, or use for any purpose except that contemplated by this Agreement, proprietary, trade secret or other confidential information of the other Party which has been stamped or marked as “Proprietary” or “Confidential” (in the case of tangible materials) or has orally be identified by the Party as proprietary or confidential at the time of disclosure (in the case of non-tangible items) (collectively, “Proprietary Information).  Notwithstanding the foregoing, “Proprietary Information” shall not include information that is:

(a) already known to recipient at the time of disclosure;

(b) publicly known (or becomes publicly known) without the fault or negligence of recipient;

(c) received from a third party without restriction and without breach of this Agreement;

(d) independently developed by recipient;

(e) approved for release by written authorization of the disclosing Party; or

(f) required to be disclosed by law.

The obligations of this Section shall survive the termination of this Agreement and continue in force for a period of three (3) years following such termination.

  1. INSURANCE. 702 shall maintain at its expense, in an amount equal to full replacement cost, fire and extended coverage insurance on all of its Equipment provided under this agreement, including removable trade fixtures and including the Equipment. 702 shall not be required to maintain any insurance on any other property placed by Company within the Managed Service Space.  Prior to the commencement of any installation of, modification to or work on the Equipment, Company shall obtain and maintain the following insurance, at its own expense, in amounts not less than those specified below:

(a) Workers Compensation insurance in accordance with the laws of the State of Minnesota.

(b)   Comprehensive General Liability for bodily injury liability and property damage liability with limits of $2,000,000.00 combined single limit each occurrence, and including but not limited to Comprehensive Form, Premises-Operation, Explosion Collapse, Underground Hazard, Products/Completed Operations Hazard (two (2) years extension beyond initial installation of the Equipment), Blanket Contractual Coverage (including coverage for the indemnity clauses provided under this Agreement), Broad Form Property Damage, Independent Contractors, Personal Injury (employees exclusion deleted).

(c)  Comprehensive Automobile Liability: Comprehensive form liability covering owned, hired and non-owned vehicles with limits of $1,000,000.00 combined single limit each occurrence.

(d)  Builder’s Risk insurance.

If Company engages a contractor or subcontractor, the same conditions applicable to Company under this Agreement apply to each contractor or subcontractor, including but in no way limited to the indemnity and insurance clauses.  Company shall, at 702’s request from time to time, provide 702 with a current certificate of insurance evidencing Company’s compliance with this Section.  Company shall obtain the agreement of Company’s insurers to notify 702 that a policy is due to expire at least thirty (30) days prior to such expiration.  The insurance required under clauses (a) through (d) above shall additionally contain endorsements naming 702, its directors, officers, and agents and representatives as Additional Named Insureds.  If Company fails to obtain any of the insurance required by this Section, 702 shall have the right and option, but not the obligation, to maintain at Company’s expense any or all of such insurance to be provided by Company.

Company hereby releases 702 and its partners, officers and employees from any and all liability (to the other or anyone claiming through or under them by way of subrogation or otherwise) for any loss or damage covered by property insurance or coverable by a customary policy of insurance required by this Section, even if such loss or damage shall have been caused by the fault or negligence of 702, or anyone for whom 702 may be responsible.  Company’s failure to take out or maintain any insurance policy required under this Section shall be a defense to any claim asserted by Company against 702 by reason of any loss sustained by Company that would have been covered by any such required policy.

  1. DAMAGE TO EQUIPMENT. If the Building is materially damaged by fire or other casualty, Company shall give 702 prompt notice of such damage. If a landlord of the Building exercises an option to terminate a particular lease due to the damage or destruction of the Building, or if Company decides not to rebuild or restore such Building or any portion thereof, this Agreement shall, at Company’s option and upon notice to 702 from Company, terminate as of the date of such notice.  If neither the landlord nor Company exercise this right to terminate, 702 shall repair the Managed Service Space to substantially the same condition as before in a reasonable amount of time, provided that 702 shall not be required to make any improvements that had been made or installed by Company, and further provided that 702 shall not be required to make repairs or restorations which cost in excess of the amount of available insurance proceeds.
  2. INDEMNIFICATION. Company shall at its sole cost and expense indemnify, defend and hold harmless 702, and its partners, officers, and employees (collectively an “Indemnified Party”) from and against any and all costs, liabilities, losses, and expenses (including but not limited to reasonable attorneys’ fees) (collectively “Losses”) resulting from any claim, suit, action, demand, or proceeding (each, an “Action”) brought by any third party against the Indemnified Party, arising from the installation, maintenance, operation or use of the Equipment or the Managed Service Space, or the negligence, gross negligence or willful misconduct, and/or intentional act of Company or its employees, agents, contractors, or invitees, in the performance or nonperformance of its obligations hereunder. The obligations of this Section shall survive the termination or expiration of this Agreement.
  3. LIMITATION OF LIABILITY. 702 AND ITS PARTNERS, AGENTS, EMPLOYEES AND CONTRACTORS SHALL HAVE NO LIABILITY TO COMPANY, THE CUSTOMERS OF COMPANY, OR TO ANY OTHER PERSON WITH RESPECT TO ANY DAMAGES, LOSSES, LIABILITIES OR CLAIMS FOR DEATH OR INJURY, INJURY TO OR LOSS OF PROPERTY, DELAYS, INTERRUPTIONS OF SERVICE, LOSS OF BUSINESS OR PROFITS, OR ANY OTHER INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES. THE LIABILITY OF 702 AND ITS PARTNERS, AGENTS, EMPLOYEES AND CONTRACTORS FOR ANY OTHER DAMAGES, LOSSES, LIABILITIES OR CLAIMS ARISING OUT OF THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT PAID BY COMPANY TO 702 UNDER THIS AGREEMENT IN THE TWELVE (12) MONTHS PRECEDING THE EVENT GIVING RISE TO THE CLAIM FOR DAMAGES, LOSSES OR LIABILITIES. THIS SECTION SHALL SURVIVE THE TERMINATION OR EXPIRATION OF THIS AGREEMENT.
  4. DISCLAIMER OF WARRANTIES. 702 makes no warranty or representation that the Managed Service Space is suitable for Company’s use, it being agreed that Company has inspected the Managed Service Space and accepts the same “AS IS” and agrees that 702 is under no other obligation to perform any work or provide any materials to prepare the Managed Service Space or to provide any services, except as specifically set forth in this Agreement, including its Exhibits. 702 DISCLAIMS ALL EXPRESS AND IMPLIED WARRANTIES WITH RESPECT TO THE MANAGED SERVICE SPACE AND SERVICES, INCLUDING BUT NOT LIMITED TO ANY AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE.
  5. NOTICES. For purposes of all notices and other communications required or permitted to be given under this Agreement, the addresses of the Parties will be as indicated below. All notices will be in writing and will be deemed to have been duly given if sent by first class registered or certified mail or equivalent, postage prepaid and return receipt requested, or by a reliable overnight courier service with delivery verification, addressed to the Parties at their addresses set forth:

If to 702:

702 Communications

Attn: Accounting

702 Main Ave, Moorhead, MN  56560

 

If to Company:

Organization named and address on Managed Service Quote

Either Party may designate by notice in writing a new address and/or individual to which any notice, demand, request, or communication made thereafter shall be so given, served, or sent.

  1. ASSIGNMENT; SUCCESSORS AND ASSIGNS. Company may not assign this Agreement or any rights hereunder, in whole or in part, or convey or encumber all or any portion of this rights or interests hereunder without the prior written consent of 702, which consent shall not be unreasonably withheld. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, as permitted under this Agreement.
  2. CHOICE OF LAW. This Agreement shall be construed and enforced in accordance with the laws of the State of Minnesota, without regard to conflicts of laws principles. If, for any reason, any controversy, claim, or dispute arising out of or relating to this Agreement is to be resolved in a court of law or equity, the Parties hereby irrevocably submit to the jurisdiction of any state court sitting in Clay County, Minnesota, or federal court sitting in Fergus Falls, Minnesota, and hereby waive any objection to jurisdiction and venue in any such court, and waive any claim that such forum is an inconvenient forum.
  3. RELATIONSHIP OF THE PARTIES. Nothing in this Agreement shall be deemed to create a relationship between Company and 702 of employer and employee, master and servant, principal and agent, contractor and subcontractor, joint venturers, partners or any similar relationship within the meaning of any law or otherwise. Neither Party is authorized to act as an agent for, or legal representative of, the other Party, nor shall either Party have authority to assume or create any obligation on behalf of, in the name of, or binding upon the other Party.
  4. INABILITY TO PERFORM. 702 shall not be liable or responsible for any failure or delay in its performance under this Agreement due to strikes, riots, acts of God, shortages of labor or materials, war, governmental laws, regulations or restrictions, or any other cause whatsoever beyond the control of 702.
  5. SEVERABILITY. Should any provision of’ this Agreement be held invalid, illegal and/ or unenforceable for any reason, the remainder of this Agreement shall not thereby be invalidated but shall remain in full force and effect.
  6. ENTIRE AGREEMENT. This Agreement sets forth the entire understanding of the parties and supersedes any and all prior agreements, arrangements or understandings related to the subject matter described herein.
  7. AMENDMENT. No amendment to this Agreement shall be binding unless it is made in writing and signed by duly authorized representatives as of the day and year first above written.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the day and year first above written.