SERVICE AGREEMENT

In this Agreement, Client shall refer to the customer; Prime Communications shall refer to PRIME COMMUNICATIONS.

I. OBJECTIVE OF THE AGREEMENT

It is the intention of this Agreement that PRIME COMMUNICATIONS shall provide the Client with the technical know-how and resources necessary for the Client to gain access to the Internet.

II. RIGHTS AND RESPONSIBILITIES OF PRIME COMMUNICATIONS

PRIME COMMUNICATIONS shall have the right to manage and control the access to computer systems and information stored within the Prime Communications system in a manner deemed appropriate by PRIME COMMUNICATIONS. In this regard, PRIME COMMUNICATIONS will --

(a) provide the Client with the Internet Services as specified in this application as approved by Prime Communications;

b) provide the Client with information and technical assistance necessary to configure the Client's computers with the following capabilities: Electronic mail (e-mail), World Wide Web (WWW), File Transfer Protocol (FTP);

(c) provide the Client with 24-hr telephone technical support;

(d) after the completion of the installation and acceptance by the Client of the Service, provide the Client with on-site technical assistance within 24 hours from request, at the rates charged by PRIME COMMUNICATIONS for on-site technical support;

(e) on a best effort basis, inform the Client 24-hours prior to monthly or any scheduled maintenance work on PRIME COMMUNICATIONS' system, which may or may not interfere with the Service (as defined hereunder) ;

(f) guarantee redundant routes to the Internet.

Hereafter, the foregoing are collectively referred to as the “Service”.

III. RIGHTS AND RESPONSIBILITIES OF CLIENT

Client will -

(a) be responsible for the set-up or configuration of its equipment for access to the Service;

(b) provide, at its own cost and expense, the necessary system hardware and software for the Client's computer set-up and ensure that the same meet the requirements of PRIME COMMUNICATIONS;

(c) comply with all notices and instructions given by PRIME COMMUNICATIONS from time to time with respect to the use of the Service;

(d) designate, in writing, person(s) authorized to give instructions to PRIME COMMUNICATIONS with respect to the use of the Service;

(e) be solely responsible for the proper care of all equipment, facilities or software that may be provided by PRIME COMMUNICATIONS under this Agreement which are in Client's possession or that of its customers, agents or representatives and shall be liable to PRIME COMMUNICATIONS for all damages suffered by the latter for any loss or destruction of such equipment, facilities or software arising from the fault or negligence of Client or its customers, agents or representatives. It is understood and agreed that Client holds these equipment, facilities or software in trust for PRIME COMMUNICATIONS, with the obligation to account for or return the same upon lawful demand by PRIME COMMUNICATIONS.

(f) comply with the rules of any network which the Client accesses through the Service and hold PRIME COMMUNICATIONS free and harmless from any liability arising from any violation of such rules;

(g) be solely responsible for all information retrieved, stored and transmitted through the Service;

(h) take all necessary measures as may be necessary (including, but not limited to, the changing of the password from time to time) to protect the secrecy of the User ID and/or password and ensure that the same are not revealed to any unauthorized person(s), it being understood that PRIME COMMUNICATIONS shall at all times be held free and harmless from any damages suffered by Client as a result of any unauthorized disclosure or use of such User ID and/or password without fault or negligence on the part of PRIME COMMUNICATIONS; and

(i) not engage in the commercial reselling of Internet access to individual or corporate Clients, unless with prior written consent of PRIME COMMUNICATIONS.

IV. PAYMENT

1. In consideration for the Service to be rendered by PRIME COMMUNICATIONS as provided in Article II hereof, Client shall pay the fees indicated in this application. Said fees are exclusive of the Ten Percent (10%) Value Added Tax (VAT), which shall be for the account of Client. In the event of renewal of this Agreement as provided in Article VI, Section 1 hereof, the Monthly Subscription Fee for the new term shall be the prevailing standard rates as of the end of the expiring term, unless otherwise agreed upon by the parties in writing prior to such renewal.

2. The One Time Set-up Fee shall be due on the date of commencement of the Service which shall be specified in writing by PRIME COMMUNICATIONS. Immediately after such date, the Monthly Subscription Fee shall accrue.

3. The Monthly Subscription Fees shall be payable ten (10) days before the end of the month covered.

4. The Client shall pay the Monthly Subscription Fees on or before the specified due date, notwithstanding that the Client disputes the same for any reason. In the event that a dispute is decided by PRIME COMMUNICATIONS in the Client’s favor, PRIME COMMUNICATIONS shall refund any excess amount paid by the Client, free of interest.

5. In the event of late payment by the Client of any amount due under this Agreement, PRIME COMMUNICATIONS shall have the right to charge interest on the outstanding amount at the rate of 2% per month commencing from the due date until the date of full payment.

6. In the event that an employee or agent of PRIME COMMUNICATIONS is requested to attend to a problem at the Client’s premises, PRIME COMMUNICATIONS reserves the right to impose charges for the service if the fault is not directly attributable to PRIME COMMUNICATIONS’ equipment or network. PRIME COMMUNICATIONS’ statement of account shall be conclusive evidence of Client’s request for such services.

7. If Client’s account is a Dedicated Access Package, PRIME COMMUNICATIONS shall have the right to impose a surcharge of 50% of the Monthly Subscription Fee in the event that Client’s account is suspended due to payment default under Article VI, Section 4 or when requested by Client for justifiable reasons which are acceptable to PRIME COMMUNICATIONS. The following accounts are Dedicated Access Packages: ISDN, Leased Line, DSL, Prime Communications Max, Wireless, Frame Relay.

8. Payments can be in Philippine Pesos (PhP) or US Dollars (US$), for Leased Line access. The dollar exchange rate as shown in our statement of account (SOA) is valid for payments made on or before the SOA’s payment due date. For payments made beyond the due date, PRIME COMMUNICATIONS reserves the right to apply the prevailing dollar exchange rate at the time of payment. For payments in pesos, the foreign exchange rate to be used will be based on the prevailing rate used by PRIME COMMUNICATIONS at the time of payment.

V. INTERNET CONNECTION and INSTALLATION

1. For DSL, ISDN, PRIME COMMUNICATIONS MAX & LL:
PRIME COMMUNICATIONS requires a provisioning lead-time not exceeding forty-five (45) working days from submission by Client of all required documents to process the application for Internet connection. The lead-time shall be provided to give ample time for the Telco supplier (herein defined as Telco) to install and activate the required telecommunications line, wire line or wireless. PRIME COMMUNICATIONS will provide the Client updates on the status of such installation. PRIME COMMUNICATIONS shall not be held liable for delays beyond its control. All equipment/software necessary to make the connection such as, but not limited to, routers, hubs, modems, telecommunications line, wire line or wireless (including leased lines), computers, internal cablings, fees for Systems Integrators/Solution Providers, etc. shall be for account of the Client.

The Client will also be responsible for the set-up or configuration and maintenance of its equipment for access to the Internet.

PRIME COMMUNICATIONS shall not be responsible for the maintenance of equipment, facilities and software provided by the Telco supplier to the Client. The Client shall be solely responsible for the proper care of all Telco-owned equipment, facilities and software in its or its customer’s possession. PRIME COMMUNICATIONS shall not be responsible for any loss or destruction of or damage to the Telco-owned equipment, facilities and software as a result of any cause.

2. For Multi-User Business and Dedicated Dial-Ups (MUBs/DDUs):
Caller-Line Identification (CLI) / Simultaneous Log-Ins:
PRIME COMMUNICATIONS requires caller-ID registration. All telephone numbers to be used by the Client must be registered. Should the Client opt not to provide a caller-ID listing, all access recorded under the Client’s account shall be the responsibility of the Client and as such, all charges shall be included in its monthly statement of account. PRIME COMMUNICATIONS shall not be liable for any unauthorized usage.

PRIME COMMUNICATIONS does not allow simultaneous log-ins unless otherwise requested in writing by the Client. PRIME COMMUNICATIONS reserves the right to disable access, should its system detect simultaneous log-ins.

Credit Limit:
PRIME COMMUNICATIONS shall provide the Client a credit limit equivalent to double the hours of the package subscribed. The Service shall automatically be suspended and Internet access denied, if the Client has exceeded the allotted credit limit. The Service shall be reactivated upon receipt by PRIME COMMUNICATIONS of a letter from the Client requesting reactivation and full payment by Client of all outstanding charges.

Global Roaming:
Global roaming shall be activated on a per request basis and shall be subject to traffic charges, the rate of which depends on the number accessed.

VI. TERM, RENEWAL, TERMINATION, and UPGRADE

1. This Agreement shall be in full force and effect for one (1) year from the date this agreement is signed by both parties and shall be automatically renewed for a one (1)-year term every year thereafter unless either party terminates this Agreement by giving a notice thereof in writing to the other party on or before the 25th of the current month.

2. Notwithstanding Article VI, paragraph 1 above and except for termination for cause, Client hereby agrees to a minimum initial subscription period of one (1) year from the effective date hereof. In case of pre-termination, an administrative fee equivalent to the Monthly Subscription Fee for the remainder of the initial one (1)-year subscription period will be added to Client’s last billing statement, unless such pre-termination is directly attributable to the fault or negligence of PRIME COMMUNICATIONS. In the event of a request for downgrade, an administrative fee equivalent to 50% of the Monthly Subscription Fee will be added to Client’s next billing statement. For purposes of this Agreement, the term “downgrade” shall be understood to mean moving from Client’s existing package to a lower package based on Client's current Monthly Sign-up Fee.

3. In the event of termination of this Agreement for any cause, and without prejudice to any other remedies available to PRIME COMMUNICATIONS, the Client shall be liable for Monthly Subscription Fees up to the termination date. Requests for termination must be officially received by Prime Communications on or before the 25th of the current month for the termination to be effected during month end. Termination requests during mid-month are not allowed. Upon termination or expiration of this Agreement for any cause, and unless otherwise directed by PRIME COMMUNICATIONS in writing, Client shall promptly return to PRIME COMMUNICATIONS all of the latter’s equipment, facilities or software that may be in Client’s possession, including those installed at Client’s customers’ premises. In this regard, PRIME COMMUNICATIONS shall, upon giving five (5) days’ prior written notice thereof, be authorized to enter the premises of Client or that of its customers during office hours, in order to remove such equipment, facilities or software.

4. Without prejudice to any other rights or remedies of PRIME COMMUNICATIONS and notwithstanding any waiver by PRIME COMMUNICATIONS of any previous breach by the Client, PRIME COMMUNICATIONS may suspend the Service or any portion thereof, in the event that any amount payable by the Client is not settled in full as of their due dates.

5. Upon such suspension, the Service shall be deemed suspended and the Client shall be liable for all charges and fees incurred up to and including the date of such suspension. In addition, the Client shall be liable for all applicable charges as of the date of suspension, as provided in Sections 1 and 2, Article VI, above.

6. Notwithstanding the foregoing, upon subsequent payment in full by the Client of its outstanding obligation to PRIME COMMUNICATIONS, the latter shall without need of requiring the Client to pay any form of reconnection or reactivation fee, reconnect or reactivate the Service to the Client, in which event this Agreement shall continue as if the suspension had not occurred.

7. Client shall pay the monthly fees for the telephone lines used in connection with the Internet access. The liability of the Client shall commence from the date of activation and acceptance. Upon installation and completion of the necessary circuits, it is understood that after seven (7) days of on-line testing, the same is deemed accepted. Where the Telco connection is canceled by the Client after installation work has started or has been completed, the Client shall reimburse PRIME COMMUNICATIONS for all expenses involved in the installation. This shall not apply if the cancellation is due to PRIME COMMUNICATIONS’s or the Telco supplier’s' failure to provide the services as committed. Where the Internet access is suspended without the fault of PRIME COMMUNICATIONS, the Client shall continue to be liable for the monthly telephone fees. In the event of a Telco line termination, the Client should submit a 30- day written notice to PRIME COMMUNICATIONS prior to the effectivity of the said termination.

8. For upgrade in connection, Client shall first give a written request for upgrade of Service. The upgrade/downgrade will immediately take effect upon approval by PRIME COMMUNICATIONS. The Subscription Fee of Client will be adjusted for the month that Client’s request for upgrade is approved, such that Client shall be charged the proportionate amount of the new Subscription Fee corresponding to the remaining days of the month following the date PRIME COMMUNICATIONS approves the upgrade. Thereafter, Client shall be charged the new Subscription Fee.

VII. SECURITY

The Client shall (i) designate the person(s) authorized to give instructions to PRIME COMMUNICATIONS with respect to the use of the Service; (ii) be solely responsible for the proper care of all equipment, facilities or software that may be provided by PRIME COMMUNICATIONS under this Agreement which are in Client’s possession or that of its customers and shall be liable to PRIME COMMUNICATIONS for all damages suffered by the latter for any loss or destruction of such equipment, facilities, or software arising from the fault or negligence of the Client or its customers; (iii) be solely responsible for all information retrieved, stored and transmitted through the Service;(iv) take all measures as may be necessary (including, but not limited to changing of the password from time to time) to protect the secrecy of the user ID and/or password and ensure that the same are not revealed to any unauthorized person(s), it being understood that PRIME COMMUNICATIONS shall at all times be held free and harmless from any damages suffered by the Client as a result of any unauthorized disclosure or use of such user ID and/or password without fault or negligence on the part of PRIME COMMUNICATIONS.

VIII. MISCELLANEOUS PROVISIONS

1. Disclaimer. PRIME COMMUNICATIONS gives no warranty in respect of any equipment, facility, software or Service provided to the Client and shall not be liable to the Client for any cost, claim, liability, expense, demand or damages whatsoever (including any loss of profits, lost savings or incidental or consequential damages), arising out of the Client’s use of or inability to use such equipment, facility, software or Service, even if PRIME COMMUNICATIONS or any of its authorized representatives has been advised of the possibility of such damages, or of any claim by any third party.

2. While every care is taken by PRIME COMMUNICATIONS in rendering the Service, PRIME COMMUNICATIONS shall not be liable for any loss of information howsoever caused whether as a result of any interruption, suspension, or termination of the Service or otherwise. Neither shall PRIME COMMUNICATIONS be liable for the contents, accuracy or quality of information available, received or transmitted through the Service.

3. The Client shall be solely responsible, and PRIME COMMUNICATIONS shall not be liable in any manner whatsoever, for ensuring that in using the Service, all applicable laws, rules and regulations and all the terms prescribed by the National Telecommunications Commission for the use of any telecommunications systems, service or equipment are, at all times, complied with.

4. PRIME COMMUNICATIONS shall not be liable for any loss or damage sustained by reason of any disclosure (inadvertent or otherwise) of any information concerning the Client’s account and particulars nor for any error, omission or inaccuracy with respect to any information so disclosed.

5. Indemnity. The Client shall indemnify and hold PRIME COMMUNICATIONS harmless at all times against actions, proceedings, costs, claims, expenses, demands, liabilities, losses and damages whatsoever including without limitation for defamation, infringement of intellectual property rights, death, bodily injury, property damage or pecuniary losses however arising which PRIME COMMUNICATIONS may sustain, incur, suffer or pay arising out of or in connection with the use of the Service by the Client or any act or omission of the Client in relation to this Agreement.

6. Confidentiality. The Client shall not divulge or communicate to any person (other than those who should know the same) or use or exploit for any purpose whatsoever (other than that contemplated in this Agreement) any confidential information which may or may have come to its knowledge by reason of or in connection with this Agreement including, without limitation, subscription rates and terms and conditions, and shall use all reasonable efforts to prevent its employees, officers, agents and consultants from so acting, except where the prior written consent of PRIME COMMUNICATIONS is obtained or where required to be disclosed pursuant to any applicable law or legal process issued by any court or the rules of any relevant regulatory body. Client expressly acknowledges that a breach of this clause will result in material and irreparable injury to PRIME COMMUNICATIONS and that it would be difficult to establish the full monetary value of such damage. Therefore, PRIME COMMUNICATIONS shall be entitled to injunctive relief in such event, in addition to other remedies available to it under existing law.

7. Modification/Severance/Non-Waiver. This Agreement may only be amended or modified upon mutual written agreement of the parties hereto. If one or more provisions of this Agreement shall for any reason be held invalid, illegal, or unenforceable, the same shall be deemed severed there from and shall not affect the remaining provisions. Failure or delay by either party in exercising any right or power hereunder shall not operate as a waiver of such right or power.

8. Assignment. Client shall not assign any of its rights and obligations under this Agreement without the prior written consent of PRIME COMMUNICATIONS.

9. Force Majeure. PRIME COMMUNICATIONS shall have no liability whatsoever or be deemed to be in default for any delay or failure in performance under this Agreement resulting from acts beyond the control of PRIME COMMUNICATIONS, including without limitation acts of God, acts or regulations of any national or local government agency, war or national emergency, accident, fire, lightning, riot, strikes, lock-outs, industrial disputes (whether or not involving PRIME COMMUNICATIONS’ employees) or epidemics.

10. Governing Law and Jurisdiction. This Agreement is governed by the laws of the Republic of the Philippines and the parties submit to the exclusive jurisdiction of the Philippine courts.

11. Venue. In the event of any dispute or claim arising from this Agreement, the parties hereby agree to submit such dispute before the proper courts of Pasig City, to the exclusion of all other venues.