1022-00008 · Northgate Telecommunications PLC · Transaction Documents

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Calderwood & Harkness LLP Matter No. 1022-00008

MASTER SERVICES AGREEMENT

Execution Version

Dated as of June 9, 2023

by and between

NORTHGATE AMERICAS, INC.

and

CEDARPOINT SYSTEMS INTEGRATION, INC.

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MASTER SERVICES AGREEMENT

THIS MASTER SERVICES AGREEMENT (this "Agreement") is made and entered into as of June 9, 2023 (the "Effective Date"), by and between:

NORTHGATE AMERICAS, INC., a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 1700 Market Street, Suite 2400, Philadelphia, Pennsylvania 19103 (hereinafter referred to as "Customer"),

and

CEDARPOINT SYSTEMS INTEGRATION, INC., a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 11400 Commerce Park Drive, Suite 600, Reston, Virginia 20191 (hereinafter referred to as "Service Provider").

Customer and Service Provider are each referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS. WHEREAS, Customer is a wholly owned subsidiary of Northgate Telecommunications PLC, a public limited company organized and existing under the laws of England and Wales (London Stock Exchange ticker: NTP.L), headquartered at 45 Threadneedle Court, London EC2R 8AH, United Kingdom, and Customer operates as the North American operating subsidiary of Northgate Telecommunications PLC;

WHEREAS, Customer operates a managed wide-area network spanning approximately three hundred forty (340) enterprise locations across twenty-eight (28) states within the United States of America and three (3) provinces within Canada, supporting the telecommunications and enterprise networking operations of Customer and its Affiliates throughout North America;

WHEREAS, Service Provider specializes in the provision of managed network infrastructure services, software-defined wide-area network ("SD-WAN") deployment and optimization, network monitoring, and cybersecurity services for enterprise clients, and Service Provider maintains Network Operations Centers in Reston, Virginia and Winnipeg, Manitoba, Canada;

WHEREAS, Service Provider has designed, developed, and owns a proprietary network orchestration platform known as "ArcMesh" (current version 4.2 as of the Effective Date), which provides network automation, orchestration, analytics, and policy-based management capabilities for enterprise-grade SD-WAN environments;

WHEREAS, Customer desires to engage Service Provider to provide managed network services, including the migration of Customer's existing MPLS network infrastructure currently operated by Greystone Halcyon Software (the "Legacy Infrastructure") to an SD-WAN architecture, and to license the ArcMesh Platform for use in connection with such managed network services, and Service Provider desires to provide such services and grant such license, all on the terms and conditions set forth in this Agreement;

WHEREAS, the Parties previously entered into a Mutual Non-Disclosure Agreement dated February 22, 2023 (the "NDA"), pursuant to which the Parties exchanged certain confidential and proprietary information in connection with the evaluation and negotiation of the business relationship contemplated hereby; and

WHEREAS, this Agreement is intended to supersede all prior negotiations, understandings, proposals, term sheets, letters of intent, and agreements between the Parties, whether oral or written, relating to the subject matter hereof, except for the NDA, which is incorporated herein by reference and shall remain in full force and effect in accordance with its terms.

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

ARTICLE 1 — DEFINITIONS

As used in this Agreement, the following capitalized terms shall have the meanings set forth below. Other capitalized terms are defined elsewhere in this Agreement and shall have the meanings ascribed to them in the sections in which they are defined.

1.1 "Acceptable Use Policy" means the acceptable use policy governing Customer's use of the ArcMesh Platform and the Services, as set forth in Exhibit D attached hereto and incorporated herein by reference, as the same may be updated from time to time by Service Provider with the prior written consent of Customer, which consent shall not be unreasonably withheld, conditioned, or delayed.

1.2 "Affiliate" means, with respect to any Person, any other Person that, directly or indirectly, controls, is controlled by, or is under common control with such Person. For purposes of this definition, "control" (including the terms "controlled by" and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise. For the avoidance of doubt, Northgate Telecommunications PLC and its direct and indirect subsidiaries are Affiliates of Customer, and entities in which Ridgeline Capital Partners, LP holds a controlling interest are Affiliates of Service Provider.

1.3 "Agreement" means this Master Services Agreement, together with all Exhibits and Schedules attached hereto and incorporated herein by reference, as the same may be amended, modified, or supplemented from time to time in accordance with the terms hereof.

1.4 "Annual Contract Value" or "ACV" means the sum of Fifteen Million Dollars ($15,000,000) per year, representing the aggregate annual Fees payable by Customer to Service Provider under this Agreement, as further described in Section 5.1 and Exhibit C.

1.5 "ArcMesh Platform" means Service Provider's proprietary network orchestration platform, designated as version 4.2 as of the Effective Date, together with all Updates and Upgrades provided to Customer during the Term, including all software, firmware, application programming interfaces, documentation, and associated tools and utilities comprising the platform.

1.6 "Change of Control" has the meaning set forth in Section 14.4 and the detailed provisions of Schedule 2 attached hereto.

1.7 "Closing Date" means June 9, 2023, which date is simultaneous with the Effective Date.

1.8 "Comparable Customer" means any customer of Service Provider that maintains, at the time of measurement, a contract or arrangement with Service Provider for managed network services encompassing two hundred (200) or more managed nodes.

1.9 "Confidential Information" has the meaning set forth in Section 12.2 and includes all information designated as confidential under the NDA.

1.10 "Customer Data" means all data, information, content, records, files, and materials in any form or medium that is (a) provided by or on behalf of Customer or Customer's Affiliates to Service Provider in connection with this Agreement, (b) generated, collected, processed, stored, or transmitted by or through the Services on behalf of Customer, or (c) derived from any of the foregoing. Customer Data includes, without limitation, network traffic data, configuration data, performance metrics, log files, and any personally identifiable information of Customer's employees, contractors, or end users processed in connection with the Services.

1.11 "Data Security Requirements" means the data security and privacy requirements set forth in Exhibit E attached hereto and incorporated herein by reference, as the same may be updated from time to time by mutual written agreement of the Parties.

1.12 "Effective Date" means June 9, 2023.

1.13 "Escrow Agent" means Dravello National Bank, a nationally chartered banking institution headquartered in Charlotte, North Carolina, or any successor escrow agent appointed in accordance with the Escrow Agreement.

1.14 "Escrow Agreement" means the Tri-Party Escrow Agreement among Customer, Service Provider, and the Escrow Agent, dated as of the Effective Date, governing the deposit, maintenance, investment, and release of the Transition/Wind-Down Escrow Deposits, as the same may be amended from time to time in accordance with its terms.

1.15 "Exhibits" means Exhibits A through F attached hereto and incorporated herein by reference, each as described in Article 25.

1.16 "Fees" means all amounts payable by Customer to Service Provider under this Agreement, as set forth in Exhibit C, including fees for managed network services, ArcMesh Platform license and maintenance, professional services, and any other amounts expressly provided for herein.

1.17 "Force Majeure Event" has the meaning set forth in Section 18.1.

1.18 "Initial Term" means the period commencing on the Effective Date and expiring at 11:59 p.m. Eastern Time on June 8, 2028, unless earlier terminated in accordance with the provisions of this Agreement.

1.19 "intellectual Property" or "IP" means all intellectual property and proprietary rights of every kind and nature, whether arising under the laws of the United States, any state thereof, Canada, any province thereof, or any other jurisdiction, including all patents, patent applications, inventions, copyrights, copyright registrations and applications, trademarks, trademark registrations and applications, service marks, trade names, trade dress, trade secrets, know-how, algorithms, software (in source code and object code form), databases, mask works, moral rights, and all other intellectual property rights recognized under applicable law, together with all goodwill associated therewith.

1.20 "Legacy Infrastructure" means Customer's existing multi-protocol label switching ("MPLS") wide-area network infrastructure, currently provided and managed by Greystone Halcyon Software pursuant to that certain Master Services Agreement dated April 15, 2017 between Customer and Greystone Halcyon Software (as amended), which MPLS network is the subject of the Migration contemplated by this Agreement.

1.21 "Managed Nodes" means the three hundred forty (340) network nodes and associated equipment and circuits at the Node Locations identified and described in Schedule 1 attached hereto, as the same may be modified from time to time by mutual written agreement of the Parties or in connection with a change order executed pursuant to Section 3.4.

1.22 "Migration" means the planned transition and migration of Customer's network infrastructure from the Legacy Infrastructure to the ArcMesh Platform and Service Provider's managed SD-WAN services, as described in Exhibit A (Statement of Work) and the Transition Services Side Letter entered into by the Parties as of the Effective Date, to be completed in three (3) phases over a period of eighteen (18) months from the Effective Date.

1.23 "Monthly Run-Rate" means One Million Two Hundred Fifty Thousand Dollars ($1,250,000) per month, representing one-twelfth (1/12) of the Annual Contract Value.

1.24 "Most Favored Nation" or "MFN" means the pricing protections and provisions set forth in Article 6 and Schedule 3 attached hereto, pursuant to which Service Provider warrants that the per-unit pricing charged to Customer shall be no less favorable than the pricing offered to any Comparable Customer.

1.25 "Network Operations Center" or "NOC" means Service Provider's network monitoring and management facilities located at (a) 11400 Commerce Park Drive, Suite 600, Reston, Virginia 20191, and (b) 1200 Portage Avenue, Suite 400, Winnipeg, Manitoba R3G 0T5, Canada, from which Service Provider provides 24×7 monitoring, management, and incident response services for the managed network.

1.26 "NDA" means the Mutual Non-Disclosure Agreement dated February 22, 2023, entered into between Customer and Service Provider, as incorporated herein by reference pursuant to Section 12.1.

1.27 "Node Locations" means the physical locations of the Managed Nodes, as identified in Schedule 1 attached hereto.

1.28 "Person" means any individual, corporation, partnership, limited liability company, trust, governmental authority, or other entity.

1.29 "Renewal Term" means each successive two (2)-year renewal period following the expiration of the Initial Term, as described in Section 2.3.

1.30 "Schedules" means Schedules 1 through 3 attached hereto and incorporated herein by reference, each as described in Article 25.

1.31 "Service Credits" means the credits to which Customer is entitled under the Service Level Agreement (Exhibit B) in the event that Service Provider fails to meet the applicable service levels, as further described in Article 7.

1.32 "Service Descriptions" means the descriptions of the Services set forth in Exhibit A (Statement of Work) attached hereto and incorporated herein by reference.

1.33 "Service Level Agreement" or "SLA" means the service level commitments, performance standards, measurement methodologies, and remedies set forth in Exhibit B attached hereto and incorporated herein by reference.

1.34 "Services" means, collectively, the managed network services, ArcMesh Platform license and maintenance services, cybersecurity monitoring and incident response services, professional services (including implementation, migration, and optimization services), and all other services described in the Service Descriptions (Exhibit A) and to be provided by Service Provider to Customer pursuant to this Agreement.

1.35 "Term" means the Initial Term together with any Renewal Terms, as described in Sections 2.2 and 2.3.

1.36 "Total Contract Value" or "TCV" means the sum of Seventy-Five Million Dollars ($75,000,000), representing the aggregate Fees payable by Customer to Service Provider over the five (5)-year Initial Term (calculated as $15,000,000 ACV × 5 years), exclusive of any Fees attributable to Renewal Terms or change orders.

1.37 "Transition/Wind-Down Escrow Deposit" means the amounts deposited by Customer into the escrow account maintained by the Escrow Agent, as described in Section 16.2 and the Escrow Agreement, for the purpose of securing funds to facilitate the orderly transition of Services upon expiration or termination of this Agreement.

1.38 "Uncapped Claims" has the meaning set forth in Section 13.6.

1.39 "Updates and Upgrades" means all updates, patches, bug fixes, security patches, minor version releases, major version releases, and upgrades to the ArcMesh Platform that Service Provider makes generally available to its customers during the Term.

1.40 "Wind-Down Period" means the period following the effective date of expiration or termination of this Agreement during which Service Provider provides transition assistance to Customer in accordance with Section 16.1, not to exceed twelve (12) months.

1.41 "Work Product" has the meaning set forth in Section 10.3.

ARTICLE 2 — TERM

Section 2.1 — Effective Date and Commencement. This Agreement shall become effective as of the Effective Date. The Parties acknowledge and agree that the signing and closing of this Agreement are simultaneous events occurring on the Effective Date, and that the Services shall commence on the Effective Date, subject to the satisfaction or waiver of the conditions precedent set forth in Article 9. From and after the Effective Date, Service Provider shall commence performance of the Services in accordance with the implementation timeline set forth in Exhibit A and the Transition Services Side Letter.

Section 2.2 — Initial Term. The initial term of this Agreement (the "Initial Term") shall commence on the Effective Date and shall continue for a period of five (5) years, expiring at 11:59 p.m. Eastern Time on June 8, 2028, unless this Agreement is earlier terminated in accordance with the provisions of Article 15 or otherwise as expressly provided herein. During the Initial Term, the Total Contract Value shall be Seventy-Five Million Dollars ($75,000,000), payable in accordance with the Fee structure and payment terms set forth in Article 5 and Exhibit C.

Section 2.3 — Renewal Terms. Upon expiration of the Initial Term, this Agreement shall automatically renew for up to two (2) successive renewal terms of two (2) years each (each, a "Renewal Term"), unless either Party provides the other Party with written notice of non-renewal at least one hundred eighty (180) days prior to the expiration of the then-current term (whether the Initial Term or a Renewal Term, as applicable). Any such notice of non-renewal shall be delivered in accordance with the notice provisions set forth in Article 23. For the avoidance of doubt, if the Initial Term is not renewed, this Agreement shall expire on June 8, 2028. If the first Renewal Term is entered into and not subsequently terminated, the first Renewal Term shall expire on June 8, 2030. If the second Renewal Term is entered into and not subsequently terminated, the second Renewal Term shall expire on June 8, 2032. Fees applicable during any Renewal Term shall be determined in accordance with Exhibit C, including applicable annual escalation provisions.

Section 2.4 — Effect of Expiration. Upon the expiration or termination of this Agreement for any reason, those provisions of this Agreement that by their nature are intended to survive expiration or termination, including, without limitation, the provisions of Article 10 (Intellectual Property), Article 12 (Confidentiality), Article 13 (Indemnification), Article 17 (Limitation of Liability), Article 19 (Governing Law; Jurisdiction), Article 20 (Dispute Resolution), Section 16 (Transition Assistance and Escrow), and any accrued payment obligations, shall continue in full force and effect in accordance with their respective terms. The expiration or termination of this Agreement shall not relieve either Party of any obligation or liability that accrued prior to the effective date of such expiration or termination.

ARTICLE 3 — SCOPE OF SERVICES

Section 3.1 — Services. During the Term, Service Provider shall provide Customer with the Services described in the Service Descriptions set forth in Exhibit A (Statement of Work), including, without limitation, the following:

(a) Managed WAN Services. Service Provider shall provide managed wide-area network services across all three hundred forty (340) Managed Nodes located in twenty-eight (28) states within the United States and three (3) provinces within Canada, as identified in Schedule 1. Such managed WAN services shall include circuit management, network configuration, change management, capacity planning, and day-to-day operational support for the Customer's enterprise network.

(b) SD-WAN Deployment and Optimization. Service Provider shall deploy, configure, and optimize a software-defined wide-area network architecture utilizing the ArcMesh Platform (version 4.2, as updated during the Term). SD-WAN services shall include intelligent path selection, application-aware routing, dynamic bandwidth allocation, WAN optimization, and policy-based traffic management across all Managed Nodes.

(c) 24×7 Network Operations Center (NOC) Monitoring. Service Provider shall provide continuous, twenty-four (24) hours per day, seven (7) days per week, three hundred sixty-five (365) days per year network monitoring, fault detection, event correlation, and incident management from Service Provider's Network Operations Center facilities located in Reston, Virginia and Winnipeg, Manitoba, Canada. The NOC shall serve as the primary point of contact for network-related incidents and shall maintain staffing levels sufficient to ensure compliance with the response time commitments set forth in the Service Level Agreement (Exhibit B).

(d) Quarterly Network Performance Reviews. Service Provider shall conduct quarterly network performance reviews and deliver written optimization reports to Customer's designated service delivery manager. Such reports shall include trending analysis, capacity utilization metrics, network availability statistics, security incident summaries, and recommendations for performance improvements.

(e) Migration from Legacy Infrastructure. Service Provider shall manage the migration of Customer's network infrastructure from the Legacy Infrastructure (the existing MPLS network provided by Greystone Halcyon Software) to the ArcMesh Platform and managed SD-WAN services. The Migration shall be completed in three (3) phases over a period of eighteen (18) months from the Effective Date, as further detailed in the Transition Services Side Letter entered into by the Parties concurrently herewith. Phase 1 shall encompass the deployment of ArcMesh overlay and pilot migration of approximately one hundred (100) nodes; Phase 2 shall encompass the migration of an additional one hundred forty (140) nodes; and Phase 3 shall encompass the migration of the remaining one hundred (100) nodes and final decommissioning of Legacy Infrastructure circuits.

(f) Cybersecurity Services. Service Provider shall provide cybersecurity monitoring, threat detection, vulnerability assessment, and incident response services for the managed network perimeter. Such cybersecurity services shall include real-time threat intelligence feeds, intrusion detection and prevention, distributed denial-of-service ("DDoS") mitigation, firewall management, and security event logging and analysis, all as further described in Exhibit A.

(g) Dedicated Service Delivery Manager. Service Provider shall assign a dedicated service delivery manager to the Customer account who shall serve as Customer's primary point of contact for all service-related matters, including escalation management, service improvement initiatives, and coordination of professional services engagements. The assigned service delivery manager shall be subject to Customer's reasonable approval, and Service Provider shall not reassign or replace such individual without providing Customer with at least thirty (30) days' prior written notice and an opportunity to interview the proposed replacement.

Section 3.2 — Service Levels. Service Provider shall perform the Services in accordance with the service levels, performance standards, and key performance indicators set forth in the Service Level Agreement (Exhibit B). Without limiting the generality of the foregoing, Service Provider shall maintain a network availability target of not less than ninety-nine and ninety-five hundredths percent (99.95%) monthly uptime, measured on a per-node basis, across all Managed Nodes. The methodology for measuring network availability, scheduled maintenance windows, and exclusions from availability calculations are set forth in Exhibit B. Service Provider's failure to meet the SLA targets shall entitle Customer to Service Credits in accordance with Article 7.

Section 3.3 — Node Locations. The Services shall be provided to and at the Managed Nodes identified in Schedule 1 (Node Locations) attached hereto. Schedule 1 sets forth, for each Managed Node, the physical address, circuit type, bandwidth allocation, and service tier applicable to such node. The Parties may add, remove, or modify Managed Nodes from time to time by mutual written agreement in accordance with the change order procedures set forth in Section 3.4. Any addition of nodes shall be subject to the pricing provisions of Exhibit C and the MFN protections of Article 6 and Schedule 3.

Section 3.4 — Changes to Scope. Any material change to the scope, volume, or specifications of the Services, including the addition or removal of Managed Nodes, changes to service tier classifications, modifications to the Migration timeline, or the engagement of Service Provider for new or additional professional services not contemplated by Exhibit A, shall require a written amendment or change order executed by duly authorized representatives of both Parties. Each change order shall describe in reasonable detail the proposed change, the impact on Fees (if any), the timeline for implementation, and any modifications to the applicable service levels. Service Provider shall not be obligated to perform work outside the scope of this Agreement and the applicable change orders without such written authorization.

ARTICLE 4 — ARCMESH PLATFORM LICENSE

Section 4.1 — License Grant. Subject to the terms and conditions of this Agreement, including the license restrictions set forth in Section 4.2 and the Acceptable Use Policy (Exhibit D), Service Provider hereby grants to Customer, and Customer hereby accepts, a non-exclusive, non-transferable (except as expressly permitted under Section 14.2), limited license to access and use the ArcMesh Platform (version 4.2, as updated from time to time with Updates and Upgrades provided pursuant to Section 4.3) solely in connection with the receipt and use of the Services during the Term. The license granted herein is limited to Customer's internal business operations and the management of Customer's enterprise network across the Managed Nodes. Customer may permit its employees, contractors, and agents to access and use the ArcMesh Platform solely for purposes of receiving the Services, provided that Customer shall remain responsible for such individuals' compliance with the terms and conditions of this Agreement.

Section 4.2 — License Restrictions. Customer acknowledges that the ArcMesh Platform is the proprietary property of Service Provider and is protected by applicable intellectual property laws. Customer shall not, and shall not permit any third party to:

(a) sublicense, distribute, sell, lease, rent, lend, or otherwise transfer the ArcMesh Platform or any rights therein to any third party;

(b) reverse engineer, decompile, disassemble, or otherwise attempt to derive or discover the source code, object code, algorithms, data structures, or underlying ideas or architecture of the ArcMesh Platform, except to the extent expressly permitted by applicable law notwithstanding a contractual prohibition to the contrary;

(c) modify, adapt, translate, or create derivative works based upon the ArcMesh Platform, except for custom configurations and integrations performed by Service Provider on Customer's behalf as part of the Services;

(d) remove, alter, or obscure any proprietary notices, labels, trademarks, or copyright legends affixed to or embedded in the ArcMesh Platform;

(e) use the ArcMesh Platform for purposes outside the licensed scope described herein and in the Acceptable Use Policy (Exhibit D), including using the ArcMesh Platform to provide network management services to any third party; or

(f) use the ArcMesh Platform in any manner that violates applicable law or infringes the rights of any third party.

Section 4.3 — Updates and Upgrades. During the Term, Service Provider shall provide all Updates and Upgrades to the ArcMesh Platform as part of the ArcMesh Platform license and maintenance fee set forth in Section 5.1(b) and Exhibit C, at no additional cost to Customer. Service Provider shall provide Customer with reasonable advance notice of any material Updates or Upgrades, including a description of the changes, new features, and any required actions on Customer's part. Service Provider shall coordinate the deployment of Updates and Upgrades with Customer's designated service delivery manager to minimize disruption to the Services. Notwithstanding the foregoing, Service Provider may deploy critical security patches on an expedited basis without prior notice, provided that Service Provider shall notify Customer promptly following such deployment.

Section 4.4 — Ownership. All right, title, and interest in and to the ArcMesh Platform, including all intellectual Property rights therein, are and shall remain the sole and exclusive property of Service Provider. Nothing in this Agreement shall be construed as transferring, assigning, or conveying to Customer any ownership interest in or to the ArcMesh Platform or any component thereof. Customer's rights with respect to the ArcMesh Platform are limited to the license expressly granted in Section 4.1, and no other rights are granted by implication, estoppel, or otherwise.

ARTICLE 5 — FEES AND PAYMENT

Section 5.1 — Fee Structure. In consideration of Service Provider's performance of the Services and the license grant set forth in Article 4, Customer shall pay Service Provider the Fees set forth in Exhibit C (Pricing Schedule and Fee Structure). The Fee structure is as follows:

(a) Managed Network Services (Operations, Monitoring, NOC). Ten Million Five Hundred Thousand Dollars ($10,500,000) per year, representing seventy percent (70%) of the Annual Contract Value. This fee component encompasses all managed WAN services, 24×7 NOC monitoring, fault management, configuration management, circuit management, and quarterly performance reviews described in Section 3.1.

(b) ArcMesh Platform License and Maintenance. Three Million Dollars ($3,000,000) per year, representing twenty percent (20%) of the Annual Contract Value. This fee component encompasses the license to access and use the ArcMesh Platform as described in Article 4, all Updates and Upgrades during the Term, platform support services, and ongoing maintenance.

(c) Professional Services (Implementation, Migration, Optimization). One Million Five Hundred Thousand Dollars ($1,500,000) per year, representing ten percent (10%) of the Annual Contract Value. This fee component encompasses implementation services, Migration-related professional services, network optimization consulting, and other professional services engagements described in Exhibit A, subject to the change order provisions of Section 3.4.

The total Annual Contract Value is Fifteen Million Dollars ($15,000,000). The Total Contract Value over the five (5)-year Initial Term is Seventy-Five Million Dollars ($75,000,000). The Monthly Run-Rate is One Million Two Hundred Fifty Thousand Dollars ($1,250,000).

Section 5.2 — Invoicing. Service Provider shall invoice Customer on a monthly basis, in advance, on or before the first business day of each calendar month. Each invoice shall set forth in reasonable detail the Services covered, the applicable Fee components, any Service Credits earned during the preceding month, and the net amount due. Customer shall pay all undisputed amounts within thirty (30) days following Customer's receipt of a proper and complete invoice. Invoices shall be submitted electronically to Customer's designated accounts payable contact and shall reference this Agreement and the applicable purchase order number, if any.

Section 5.3 — Annual Escalation. Fees for the managed network services and ArcMesh Platform license and maintenance components are subject to annual escalation as set forth in Exhibit C. Any annual escalation shall take effect on each anniversary of the Effective Date, beginning on the first anniversary. The annual escalation mechanism, including the applicable index or percentage, escalation cap, and calculation methodology, is set forth in detail in Exhibit C.

Section 5.4 — Taxes.

(a) Each Party shall be solely responsible for all taxes imposed on its own income, capital, franchise, or similar taxes imposed on such Party by reason of its legal status, organizational form, or business activities generally.

(b) Customer shall be responsible for all applicable sales taxes, use taxes, value-added taxes, goods and services taxes ("GST"), harmonized sales taxes ("HST"), provincial sales taxes, and similar transaction-based taxes and governmental charges imposed on the Services or the Fees payable hereunder, except for taxes based on Service Provider's net income, gross receipts (to the extent imposed in lieu of income taxes), or capital. Service Provider shall separately state all applicable taxes on each invoice.

(c) If Customer is required by applicable law to withhold or deduct any taxes from payments to Service Provider, Customer shall gross up the payment so that the net amount received by Service Provider after withholding equals the full amount otherwise due. The Parties shall cooperate in good faith to minimize any applicable withholding taxes and to complete and file any forms or documents necessary to claim available exemptions or reduced withholding rates.

(d) Customer (Employer Identification Number: 84-3291067) and Service Provider (Employer Identification Number: 52-4178503) acknowledge that the Services are provided across twenty-eight (28) states within the United States and three (3) provinces within Canada, and that the tax obligations of the Parties under this Agreement may be subject to the tax laws and regulations of multiple jurisdictions. Each Party shall cooperate with the other in good faith to address cross-jurisdictional tax compliance matters, including the provision of resale certificates, exemption certificates, and other documentation reasonably requested by the other Party. The detailed tax provisions applicable to the Parties' obligations are set forth in Exhibit C.

Section 5.5 — Disputed Invoices. Customer may dispute any invoice or any line item of an invoice in good faith by providing written notice to Service Provider within thirty (30) days following Customer's receipt of such invoice. Such notice shall specify in reasonable detail the basis for the dispute and the disputed amount. The Parties shall use commercially reasonable efforts to resolve any invoice dispute within thirty (30) days following Service Provider's receipt of Customer's dispute notice. Notwithstanding any dispute, Customer shall pay all undisputed amounts in accordance with the payment terms set forth in Section 5.2. No interest shall accrue on disputed amounts during the pendency of a good faith dispute. Upon resolution of a dispute, any amounts determined to be owed shall be paid within fifteen (15) days of such resolution.

Section 5.6 — Late Payment. Any undisputed amounts not paid by Customer when due shall bear interest from the due date until paid in full at a rate equal to the lesser of (a) one and one-half percent (1.5%) per month (eighteen percent (18%) per annum) or (b) the maximum rate permitted by applicable law. The accrual of interest under this Section 5.6 shall not limit Service Provider's right to exercise any other remedies available under this Agreement or at law or in equity, provided that Service Provider shall provide Customer with written notice of any past-due amounts and a ten (10)-business day opportunity to cure prior to exercising any suspension or termination remedy.

ARTICLE 6 — MOST FAVORED NATION PRICING

Section 6.1 — MFN Warranty. Service Provider represents, warrants, and covenants that the per-unit pricing for managed network services charged to Customer under this Agreement shall not, at any time during the Term, exceed the lowest per-unit pricing offered by Service Provider to any other Comparable Customer (defined as any customer of Service Provider maintaining a contract or arrangement with Service Provider for managed network services encompassing two hundred (200) or more managed nodes) during the applicable trailing twelve (12)-month period. For purposes of this MFN provision, "per-unit pricing" means the total fees charged for managed network services (exclusive of one-time professional services fees and non-recurring charges) divided by the number of managed nodes under contract. The detailed benchmarking methodology, comparable customer criteria, exclusions, and other MFN-related provisions are set forth in Schedule 3 attached hereto.

Section 6.2 — MFN Audit Rights. Customer shall have the right, exercisable not more than once per calendar year, to audit or cause a nationally recognized independent accounting firm reasonably acceptable to both Parties to audit Service Provider's pricing records, contracts, and related documentation to verify Service Provider's compliance with the most favored nation pricing provisions of this Article 6 and Schedule 3. Service Provider shall cooperate with such audit and provide reasonable access to its pricing records, redacted as necessary to protect the identity of its other customers and proprietary commercial terms not relevant to the MFN analysis. The costs and expenses of any MFN audit shall be borne by Service Provider if such audit reveals a pricing differential in violation of the MFN warranty; otherwise, the costs and expenses of the audit shall be borne by Customer.

Section 6.3 — MFN Remediation. If an MFN audit conducted pursuant to Section 6.2 reveals a pricing differential in excess of three percent (3%) between the per-unit pricing charged to Customer and the lowest per-unit pricing offered to any Comparable Customer during the applicable trailing twelve (12)-month period, Service Provider shall:

(a) issue a retroactive credit to Customer in the full amount of the pricing differential (including the initial three percent (3%)) for the entire period during which the non-compliant pricing was in effect, such credit to be applied to Customer's account or refunded within forty-five (45) days following the final determination of the MFN violation; and

(b) adjust prospective pricing to the level required to bring Customer's per-unit pricing into compliance with the MFN warranty, such adjustment to take effect within thirty (30) days following the final determination of the MFN violation and to remain in effect for the balance of the then-current term.

Section 6.4 — Detailed Terms. The detailed most favored nation pricing provisions, including the benchmark methodology and calculation mechanics, the definition and qualification criteria for Comparable Customers, exclusions and carve-outs from the MFN comparison, dispute resolution procedures specific to MFN disputes, annual certification and reporting requirements of Service Provider, and the procedures and protocols governing the conduct of MFN audits, are set forth in Schedule 3 attached hereto and incorporated herein by reference. In the event of any conflict between the provisions of this Article 6 and Schedule 3, the provisions of Schedule 3 shall control.

ARTICLE 7 — SERVICE LEVELS AND SERVICE CREDITS

Section 7.1 — SLA Standards. Service Provider shall meet or exceed the service levels, performance standards, and key performance indicators set forth in the Service Level Agreement (Exhibit B) throughout the Term. Without limiting the generality of the foregoing, Service Provider shall maintain network availability of not less than ninety-nine and ninety-five hundredths percent (99.95%) monthly uptime, measured on a per-node basis across all Managed Nodes. Network availability shall be calculated in accordance with the methodology set forth in Exhibit B, which accounts for scheduled maintenance windows, agreed-upon exclusions, and the measurement intervals applicable to each service tier.

Section 7.2 — Service Credit Tiers. In the event that Service Provider fails to meet the network availability target of 99.95% monthly uptime for any Managed Node or group of Managed Nodes in any given calendar month, Customer shall be entitled to Service Credits against the monthly managed services fee (Monthly Run-Rate of $1,250,000) in accordance with the following tiered credit structure:

(a) Tier 1: 99.90% to 99.94% uptime. If measured network availability for the applicable month falls within the range of ninety-nine and ninety hundredths percent (99.90%) to ninety-nine and ninety-four hundredths percent (99.94%), inclusive, Customer shall receive a Service Credit equal to five percent (5%) of the Monthly Run-Rate, which equals Sixty-Two Thousand Five Hundred Dollars ($62,500) per month.

(b) Tier 2: 99.50% to 99.89% uptime. If measured network availability for the applicable month falls within the range of ninety-nine and fifty hundredths percent (99.50%) to ninety-nine and eighty-nine hundredths percent (99.89%), inclusive, Customer shall receive a Service Credit equal to ten percent (10%) of the Monthly Run-Rate, which equals One Hundred Twenty-Five Thousand Dollars ($125,000) per month.

(c) Tier 3: Below 99.50% uptime. If measured network availability for the applicable month falls below ninety-nine and fifty hundredths percent (99.50%), Customer shall receive a Service Credit equal to twenty percent (20%) of the Monthly Run-Rate, which equals Two Hundred Fifty Thousand Dollars ($250,000) per month.

Service Credits earned in any calendar month shall be applied as a credit against the Fees invoiced in the immediately following month. At Customer's election, Service Credits may instead be applied as a credit against any other outstanding invoice or refunded to Customer within thirty (30) days of Customer's written request.

Section 7.3 — Annual Credit Cap. The maximum aggregate Service Credits to which Customer shall be entitled in any twelve (12)-month period (measured from each anniversary of the Effective Date) shall not exceed thirty percent (30%) of the annual managed network services fees, which equals Three Million One Hundred Fifty Thousand Dollars ($3,150,000) per year (calculated as $10,500,000 × 30%). For the avoidance of doubt, this annual credit cap applies solely to Service Credits and does not limit Customer's rights or remedies under Section 7.4, Article 13, Article 15, or any other provision of this Agreement.

Section 7.4 — Material Breach. Notwithstanding the Service Credit provisions of Section 7.2 and the annual credit cap of Section 7.3, three (3) consecutive calendar months in which measured network availability falls below ninety-nine and fifty hundredths percent (99.50%) (i.e., three consecutive Tier 3 failures) shall constitute a material breach of this Agreement by Service Provider, entitling Customer to terminate this Agreement for cause pursuant to Section 15.2. In such event, the cure period set forth in Section 15.2(a) shall not apply, and Customer may terminate this Agreement immediately upon written notice to Service Provider. Customer's right to terminate under this Section 7.4 is in addition to, and not in lieu of, Customer's right to receive Service Credits for the applicable months.

Section 7.5 — SLA Reporting. Service Provider shall provide Customer with detailed monthly SLA performance reports within ten (10) business days following the end of each calendar month. Each report shall include, at a minimum: (a) measured network availability for each Managed Node and on an aggregate basis; (b) the number and duration of outages, degradations, and incidents; (c) root cause analysis for any incident resulting in downtime exceeding fifteen (15) minutes; (d) a calculation of any Service Credits earned during the reporting period; (e) trending data comparing current month performance to the trailing twelve (12) months; and (f) remedial actions taken or planned to address recurring performance issues. Service Provider shall make available to Customer a real-time dashboard accessible through the ArcMesh Platform providing visibility into network availability, incident status, and SLA compliance metrics.

Section 7.6 — Sole Remedy. Subject to Section 7.4, Service Credits shall be Customer's sole and exclusive remedy, and Service Provider's sole and exclusive liability, for Service Provider's failure to meet the service levels specified in the Service Level Agreement (Exhibit B). Nothing in this Section 7.6 shall be construed to limit or affect Customer's rights or remedies with respect to (a) a material breach of this Agreement triggering termination rights under Section 7.4 or Section 15.2, (b) Service Provider's indemnification obligations under Article 13, or (c) any claim arising from Service Provider's gross negligence, willful misconduct, or fraud.

ARTICLE 8 — REPRESENTATIONS AND WARRANTIES

Section 8.1 — Mutual Representations. Each Party hereby represents and warrants to the other Party, as of the Effective Date, that:

(a) Organization and Good Standing. It is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and is duly qualified to do business in each jurisdiction where the nature of its business or the ownership of its properties requires such qualification.

(b) Corporate Power and Authority. It has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder, and the execution, delivery, and performance of this Agreement are within its corporate powers.

(c) Due Authorization. The execution, delivery, and performance of this Agreement have been duly authorized by all necessary corporate action on the part of such Party, including all requisite board of directors' approvals and, if applicable, stockholder approvals, and no further corporate proceedings on the part of such Party are required to authorize this Agreement or the transactions contemplated hereby.

(d) Enforceability. This Agreement constitutes a legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

(e) No Conflicts. The execution, delivery, and performance of this Agreement do not and will not (i) violate such Party's certificate of incorporation, bylaws, or other organizational documents, (ii) violate any applicable law, rule, regulation, order, judgment, or decree binding upon such Party, or (iii) result in a breach of, or constitute a default under, any material contract, agreement, or instrument to which such Party is a party or by which it is bound.

Section 8.2 — Service Provider Representations. Service Provider additionally represents and warrants to Customer, as of the Effective Date and on an ongoing basis during the Term (except as otherwise specified), that:

(a) Professional Standards. The Services will be performed in a professional and workmanlike manner, consistent with generally accepted industry standards and practices applicable to managed network services providers of comparable size and scope, and in accordance with the Service Descriptions and Service Level Agreement.

(b) Non-Infringement. The ArcMesh Platform, as provided to Customer hereunder, and Customer's use of the ArcMesh Platform in accordance with the terms of this Agreement, do not and will not infringe, misappropriate, or otherwise violate any intellectual Property rights or other proprietary rights of any third party. Service Provider has not received any notice, claim, or demand from any third party alleging that the ArcMesh Platform infringes or misappropriates any such rights.

(c) Licenses and Permits. Service Provider holds, and shall maintain during the Term, all licenses, permits, certifications, and authorizations necessary to perform the Services and to operate its Network Operations Centers, including all applicable telecommunications licenses and authorizations required by the Federal Communications Commission, the Canadian Radio-television and Telecommunications Commission, and applicable state and provincial regulatory authorities.

(d) Regulatory Compliance. Service Provider is in material compliance with all applicable federal, state, provincial, and local telecommunications regulations, data protection laws, and industry standards applicable to the Services and Service Provider's business operations.

(e) No Pending Litigation. No litigation, arbitration, administrative proceeding, or governmental investigation is pending or, to Service Provider's knowledge after due inquiry, threatened against Service Provider that would reasonably be expected to materially impair Service Provider's ability to perform its obligations under this Agreement or to have a material adverse effect on Service Provider's business, financial condition, or results of operations.

(f) Ownership Disclosure. As of the Effective Date, the ownership of Service Provider's outstanding voting equity is as follows: (i) Ridgeline Capital Partners, LP — sixty-two percent (62%); (ii) Rajiv Sundaram (Chief Executive Officer) — eighteen percent (18%); (iii) Teresa Cho (Chief Technology Officer) — twelve percent (12%); and (iv) other employees and early investors — eight percent (8%). Service Provider shall promptly notify Customer of any material change to the foregoing ownership structure.

Section 8.3 — Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, NON-INFRINGEMENT, ACCURACY, RELIABILITY, COMPLETENESS, OR ANY WARRANTY ARISING FROM COURSE OF DEALING, COURSE OF PERFORMANCE, OR USAGE OF TRADE. EACH PARTY HEREBY DISCLAIMS ALL SUCH WARRANTIES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW.

ARTICLE 9 — CONDITIONS PRECEDENT TO CLOSING

Section 9.1 — Conditions to Customer's Obligations. The obligations of Customer under this Agreement are subject to the satisfaction or written waiver by Customer of each of the following conditions on or before the Effective Date:

(a) Accuracy of Representations and Warranties. The representations and warranties of Service Provider set forth in Sections 8.1 and 8.2 shall be true and correct in all material respects as of the Effective Date as though made on and as of such date (except for representations and warranties that speak as of a specific date, which shall be true and correct in all material respects as of such date).

(b) Officer's Certificate. Service Provider shall have delivered to Customer an Officer's Certificate, duly executed by Rajiv Sundaram, Chief Executive Officer of Service Provider, certifying as to the accuracy of Service Provider's representations and warranties, the performance of Service Provider's covenants and agreements required to be performed on or before the Effective Date, and the absence of any material adverse change in Service Provider's business, financial condition, or operations since the date of the most recent financial statements provided to Customer.

(c) Secretary's Certificate. Service Provider shall have delivered to Customer a Secretary's Certificate of Service Provider, duly executed by the Secretary or an Assistant Secretary of Service Provider, attaching and certifying as true, correct, and complete copies of: (i) the resolutions of the Board of Directors of Service Provider authorizing the execution, delivery, and performance of this Agreement and the transactions contemplated hereby; (ii) the Certificate of Incorporation of Service Provider, as amended to date; (iii) the Bylaws of Service Provider, as amended to date; (iv) a Certificate of Good Standing for Service Provider issued by the Secretary of State of the State of Delaware, dated within ten (10) days of the Effective Date; and (v) incumbency certificates for Rajiv Sundaram (Chief Executive Officer), Philip Hargreaves (Chief Financial Officer), and Nadia Okafor (General Counsel), certifying the name, title, and specimen signature of each such officer.

(d) Legal Opinion. Service Provider shall have delivered to Customer a written legal opinion of Whitfield Graves & Morrow LLP, counsel to Service Provider, addressed to Customer and dated as of the Effective Date, rendered by Douglas Fenn, Esq., opining as to (i) the due organization and valid existence of Service Provider under the laws of the State of Delaware, (ii) the due authorization by Service Provider of this Agreement and the transactions contemplated hereby, (iii) the enforceability of this Agreement against Service Provider in accordance with its terms (subject to customary qualifications and assumptions), and (iv) the execution, delivery, and performance of this Agreement not resulting in any violation of Service Provider's charter documents, bylaws, or any material agreement to which Service Provider is a party, in each case in form and substance reasonably satisfactory to Customer and its counsel, Calderwood & Harkness LLP.

(e) Certificates of Insurance. Service Provider shall have delivered to Customer certificates of insurance evidencing the insurance coverage required by Exhibit F (Insurance Requirements), naming Customer as an additional insured, and otherwise in compliance with the requirements of Article 21.

(f) Escrow Agreement. Customer, Service Provider, and the Escrow Agent (Dravello National Bank) shall have executed and delivered the Escrow Agreement, in form and substance reasonably satisfactory to each Party.

Section 9.2 — Conditions to Service Provider's Obligations. The obligations of Service Provider under this Agreement are subject to the satisfaction or written waiver by Service Provider of each of the following conditions on or before the Effective Date:

(a) Accuracy of Representations and Warranties. The representations and warranties of Customer set forth in Section 8.1 shall be true and correct in all material respects as of the Effective Date as though made on and as of such date.

(b) Officer's Certificate. Customer shall have delivered to Service Provider an Officer's Certificate, duly executed by Warren Liang, President of Customer, certifying as to the accuracy of Customer's representations and warranties and the performance of Customer's covenants and agreements required to be performed on or before the Effective Date.

(c) Initial Escrow Deposit. Customer shall have deposited the initial Transition/Wind-Down Escrow Deposit in the amount of Seven Hundred Fifty Thousand Dollars ($750,000) into the escrow account maintained at Dravello National Bank (account reference number: FNB-ESC-2023-07742), in accordance with Section 16.2 and the Escrow Agreement.

Section 9.3 — Simultaneous Signing and Closing. The Parties acknowledge and agree that the signing and closing of this Agreement shall occur simultaneously on the Effective Date. All actions required to be taken at the closing shall be deemed to have occurred simultaneously, and no action shall be deemed to have been taken and no document shall be deemed to have been delivered until all actions have been taken and all documents have been delivered.

ARTICLE 10 — INTELLECTUAL PROPERTY

Section 10.1 — Service Provider IP. All right, title, and interest in and to the ArcMesh Platform, including all intellectual Property rights therein, and all other pre-existing intellectual Property of Service Provider and its licensors, shall remain the sole and exclusive property of Service Provider. Nothing in this Agreement shall be construed to transfer, assign, or convey to Customer any ownership interest in or to Service Provider's intellectual Property, and Customer hereby acknowledges and agrees that its rights with respect to the ArcMesh Platform are limited to the license expressly granted in Section 4.1. To the extent that any right, title, or interest in Service Provider's intellectual Property is deemed to vest in Customer by operation of law, Customer hereby irrevocably assigns and transfers to Service Provider all such right, title, and interest.

Section 10.2 — Customer IP. All right, title, and interest in and to Customer Data and all pre-existing intellectual Property of Customer and its Affiliates shall remain the sole and exclusive property of Customer. Service Provider shall have no rights in or to Customer Data or Customer's pre-existing intellectual Property except as expressly granted in this Agreement in connection with Service Provider's performance of the Services. Service Provider shall not use Customer Data for any purpose other than performing the Services, and Service Provider shall not disclose Customer Data to any third party except as expressly permitted by this Agreement or as directed in writing by Customer.

Section 10.3 — Work Product. Any custom configurations, integrations, scripts, documentation, reports, or other deliverables created specifically for Customer by Service Provider in the course of providing the Services (collectively, "Work Product") shall be owned by Customer, and Service Provider hereby irrevocably assigns and transfers to Customer all right, title, and interest in and to such Work Product, including all intellectual Property rights therein. Service Provider shall execute such documents and take such actions as Customer may reasonably request to evidence or perfect Customer's ownership of the Work Product. Notwithstanding the foregoing, Service Provider shall retain all right, title, and interest in its underlying pre-existing intellectual Property, including the ArcMesh Platform and any tools, methodologies, frameworks, libraries, or other materials owned by Service Provider prior to the Effective Date or developed independently of the Services, and Customer is hereby granted a non-exclusive, perpetual, royalty-free, fully paid-up license to use such underlying Service Provider IP solely to the extent embedded in or necessary for the use of the Work Product.

Section 10.4 — Feedback. Customer may, from time to time, provide Service Provider with suggestions, ideas, enhancement requests, recommendations, or other feedback regarding the ArcMesh Platform or the Services ("Feedback"). Customer hereby grants to Service Provider a perpetual, irrevocable, worldwide, royalty-free, fully paid-up, non-exclusive license to use, reproduce, modify, create derivative works of, distribute, display, perform, and otherwise exploit any Feedback for any purpose, including the improvement and enhancement of the ArcMesh Platform and Service Provider's other products and services, without obligation of any kind to Customer. Customer acknowledges that Service Provider may independently develop features, functionality, or enhancements similar to Feedback, and nothing in this Agreement shall restrict Service Provider's right to do so.

ARTICLE 11 — DATA SECURITY AND PRIVACY

Section 11.1 — Data Security Obligations. Service Provider shall implement and maintain, throughout the Term, comprehensive administrative, technical, and physical safeguards to protect Customer Data from unauthorized access, use, disclosure, alteration, or destruction, in accordance with the Data Security and Privacy Requirements set forth in Exhibit E attached hereto. Without limiting the foregoing, Service Provider shall comply with all applicable data protection and privacy laws and regulations, including the Health Insurance Portability and Accountability Act ("HIPAA") (to the extent applicable), the California Consumer Privacy Act ("CCPA") and its successor the California Privacy Rights Act ("CPRA"), the Personal Information Protection and Electronic Documents Act ("PIPEDA") (Canada), and applicable provincial privacy legislation in Canada.

Section 11.2 — Data Breach Notification. In the event of any actual or reasonably suspected unauthorized access to, acquisition of, use of, or disclosure of Customer Data (a "Data Breach"), Service Provider shall notify Customer of such Data Breach within the timeframes specified in Exhibit E (and in no event later than seventy-two (72) hours after Service Provider's discovery of the Data Breach). Such notification shall include, to the extent known at the time: (a) the nature and scope of the Data Breach; (b) the categories and approximate number of records affected; (c) a description of the measures taken or proposed to be taken to address and mitigate the Data Breach; and (d) the name and contact information of Service Provider's designated incident response coordinator. Service Provider shall cooperate with Customer in investigating and remediating the Data Breach and shall provide regular updates to Customer until the Data Breach has been fully resolved.

Section 11.3 — Data Localization. Service Provider shall process, store, and maintain Customer Data only in data

Calderwood & Harkness LLP Matter No. 1022-00008
MASTER SERVICES AGREEMENT
Execution Version
Dated as of June 9, 2023
by and between
NORTHGATE AMERICAS, INC.
and
CEDARPOINT SYSTEMS INTEGRATION, INC.
Right-click to update Table of Contents
MASTER SERVICES AGREEMENT
THIS MASTER SERVICES AGREEMENT (this "Agreement") is made and entered into as of June 9, 2023 (the "Effective Date"), by and between:
NORTHGATE AMERICAS, INC., a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 1700 Market Street, Suite 2400, Philadelphia, Pennsylvania 19103 (hereinafter referred to as "Customer"),
and
CEDARPOINT SYSTEMS INTEGRATION, INC., a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 11400 Commerce Park Drive, Suite 600, Reston, Virginia 20191 (hereinafter referred to as "Service Provider").
Customer and Service Provider are each referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS.  WHEREAS, Customer is a wholly owned subsidiary of Northgate Telecommunications PLC, a public limited company organized and existing under the laws of England and Wales (London Stock Exchange ticker: NTP.L), headquartered at 45 Threadneedle Court, London EC2R 8AH, United Kingdom, and Customer operates as the North American operating subsidiary of Northgate Telecommunications PLC;
WHEREAS, Customer operates a managed wide-area network spanning approximately three hundred forty (340) enterprise locations across twenty-eight (28) states within the United States of America and three (3) provinces within Canada, supporting the telecommunications and enterprise networking operations of Customer and its Affiliates throughout North America;
WHEREAS, Service Provider specializes in the provision of managed network infrastructure services, software-defined wide-area network ("SD-WAN") deployment and optimization, network monitoring, and cybersecurity services for enterprise clients, and Service Provider maintains Network Operations Centers in Reston, Virginia and Winnipeg, Manitoba, Canada;
WHEREAS, Service Provider has designed, developed, and owns a proprietary network orchestration platform known as "ArcMesh" (current version 4.2 as of the Effective Date), which provides network automation, orchestration, analytics, and policy-based management capabilities for enterprise-grade SD-WAN environments;
WHEREAS, Customer desires to engage Service Provider to provide managed network services, including the migration of Customer's existing MPLS network infrastructure currently operated by Greystone Halcyon Software (the "Legacy Infrastructure") to an SD-WAN architecture, and to license the ArcMesh Platform for use in connection with such managed network services, and Service Provider desires to provide such services and grant such license, all on the terms and conditions set forth in this Agreement;
WHEREAS, the Parties previously entered into a Mutual Non-Disclosure Agreement dated February 22, 2023 (the "NDA"), pursuant to which the Parties exchanged certain confidential and proprietary information in connection with the evaluation and negotiation of the business relationship contemplated hereby; and
WHEREAS, this Agreement is intended to supersede all prior negotiations, understandings, proposals, term sheets, letters of intent, and agreements between the Parties, whether oral or written, relating to the subject matter hereof, except for the NDA, which is incorporated herein by reference and shall remain in full force and effect in accordance with its terms.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 — DEFINITIONS
As used in this Agreement, the following capitalized terms shall have the meanings set forth below. Other capitalized terms are defined elsewhere in this Agreement and shall have the meanings ascribed to them in the sections in which they are defined.
1.1 "Acceptable Use Policy" means the acceptable use policy governing Customer's use of the ArcMesh Platform and the Services, as set forth in Exhibit D attached hereto and incorporated herein by reference, as the same may be updated from time to time by Service Provider with the prior written consent of Customer, which consent shall not be unreasonably withheld, conditioned, or delayed.
1.2 "Affiliate" means, with respect to any Person, any other Person that, directly or indirectly, controls, is controlled by, or is under common control with such Person. For purposes of this definition, "control" (including the terms "controlled by" and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise. For the avoidance of doubt, Northgate Telecommunications PLC and its direct and indirect subsidiaries are Affiliates of Customer, and entities in which Ridgeline Capital Partners, LP holds a controlling interest are Affiliates of Service Provider.
1.3 "Agreement" means this Master Services Agreement, together with all Exhibits and Schedules attached hereto and incorporated herein by reference, as the same may be amended, modified, or supplemented from time to time in accordance with the terms hereof.
1.4 "Annual Contract Value" or "ACV" means the sum of Fifteen Million Dollars ($15,000,000) per year, representing the aggregate annual Fees payable by Customer to Service Provider under this Agreement, as further described in Section 5.1 and Exhibit C.
1.5 "ArcMesh Platform" means Service Provider's proprietary network orchestration platform, designated as version 4.2 as of the Effective Date, together with all Updates and Upgrades provided to Customer during the Term, including all software, firmware, application programming interfaces, documentation, and associated tools and utilities comprising the platform.
1.6 "Change of Control" has the meaning set forth in Section 14.4 and the detailed provisions of Schedule 2 attached hereto.
1.7 "Closing Date" means June 9, 2023, which date is simultaneous with the Effective Date.
1.8 "Comparable Customer" means any customer of Service Provider that maintains, at the time of measurement, a contract or arrangement with Service Provider for managed network services encompassing two hundred (200) or more managed nodes.
1.9 "Confidential Information" has the meaning set forth in Section 12.2 and includes all information designated as confidential under the NDA.
1.10 "Customer Data" means all data, information, content, records, files, and materials in any form or medium that is (a) provided by or on behalf of Customer or Customer's Affiliates to Service Provider in connection with this Agreement, (b) generated, collected, processed, stored, or transmitted by or through the Services on behalf of Customer, or (c) derived from any of the foregoing. Customer Data includes, without limitation, network traffic data, configuration data, performance metrics, log files, and any personally identifiable information of Customer's employees, contractors, or end users processed in connection with the Services.
1.11 "Data Security Requirements" means the data security and privacy requirements set forth in Exhibit E attached hereto and incorporated herein by reference, as the same may be updated from time to time by mutual written agreement of the Parties.
1.12 "Effective Date" means June 9, 2023.
1.13 "Escrow Agent" means Dravello National Bank, a nationally chartered banking institution headquartered in Charlotte, North Carolina, or any successor escrow agent appointed in accordance with the Escrow Agreement.
1.14 "Escrow Agreement" means the Tri-Party Escrow Agreement among Customer, Service Provider, and the Escrow Agent, dated as of the Effective Date, governing the deposit, maintenance, investment, and release of the Transition/Wind-Down Escrow Deposits, as the same may be amended from time to time in accordance with its terms.
1.15 "Exhibits" means Exhibits A through F attached hereto and incorporated herein by reference, each as described in Article 25.
1.16 "Fees" means all amounts payable by Customer to Service Provider under this Agreement, as set forth in Exhibit C, including fees for managed network services, ArcMesh Platform license and maintenance, professional services, and any other amounts expressly provided for herein.
1.17 "Force Majeure Event" has the meaning set forth in Section 18.1.
1.18 "Initial Term" means the period commencing on the Effective Date and expiring at 11:59 p.m. Eastern Time on June 8, 2028, unless earlier terminated in accordance with the provisions of this Agreement.
1.19 "intellectual Property" or "IP" means all intellectual property and proprietary rights of every kind and nature, whether arising under the laws of the United States, any state thereof, Canada, any province thereof, or any other jurisdiction, including all patents, patent applications, inventions, copyrights, copyright registrations and applications, trademarks, trademark registrations and applications, service marks, trade names, trade dress, trade secrets, know-how, algorithms, software (in source code and object code form), databases, mask works, moral rights, and all other intellectual property rights recognized under applicable law, together with all goodwill associated therewith.
1.20 "Legacy Infrastructure" means Customer's existing multi-protocol label switching ("MPLS") wide-area network infrastructure, currently provided and managed by Greystone Halcyon Software pursuant to that certain Master Services Agreement dated April 15, 2017 between Customer and Greystone Halcyon Software (as amended), which MPLS network is the subject of the Migration contemplated by this Agreement.
1.21 "Managed Nodes" means the three hundred forty (340) network nodes and associated equipment and circuits at the Node Locations identified and described in Schedule 1 attached hereto, as the same may be modified from time to time by mutual written agreement of the Parties or in connection with a change order executed pursuant to Section 3.4.
1.22 "Migration" means the planned transition and migration of Customer's network infrastructure from the Legacy Infrastructure to the ArcMesh Platform and Service Provider's managed SD-WAN services, as described in Exhibit A (Statement of Work) and the Transition Services Side Letter entered into by the Parties as of the Effective Date, to be completed in three (3) phases over a period of eighteen (18) months from the Effective Date.
1.23 "Monthly Run-Rate" means One Million Two Hundred Fifty Thousand Dollars ($1,250,000) per month, representing one-twelfth (1/12) of the Annual Contract Value.
1.24 "Most Favored Nation" or "MFN" means the pricing protections and provisions set forth in Article 6 and Schedule 3 attached hereto, pursuant to which Service Provider warrants that the per-unit pricing charged to Customer shall be no less favorable than the pricing offered to any Comparable Customer.
1.25 "Network Operations Center" or "NOC" means Service Provider's network monitoring and management facilities located at (a) 11400 Commerce Park Drive, Suite 600, Reston, Virginia 20191, and (b) 1200 Portage Avenue, Suite 400, Winnipeg, Manitoba R3G 0T5, Canada, from which Service Provider provides 24×7 monitoring, management, and incident response services for the managed network.
1.26 "NDA" means the Mutual Non-Disclosure Agreement dated February 22, 2023, entered into between Customer and Service Provider, as incorporated herein by reference pursuant to Section 12.1.
1.27 "Node Locations" means the physical locations of the Managed Nodes, as identified in Schedule 1 attached hereto.
1.28 "Person" means any individual, corporation, partnership, limited liability company, trust, governmental authority, or other entity.
1.29 "Renewal Term" means each successive two (2)-year renewal period following the expiration of the Initial Term, as described in Section 2.3.
1.30 "Schedules" means Schedules 1 through 3 attached hereto and incorporated herein by reference, each as described in Article 25.
1.31 "Service Credits" means the credits to which Customer is entitled under the Service Level Agreement (Exhibit B) in the event that Service Provider fails to meet the applicable service levels, as further described in Article 7.
1.32 "Service Descriptions" means the descriptions of the Services set forth in Exhibit A (Statement of Work) attached hereto and incorporated herein by reference.
1.33 "Service Level Agreement" or "SLA" means the service level commitments, performance standards, measurement methodologies, and remedies set forth in Exhibit B attached hereto and incorporated herein by reference.
1.34 "Services" means, collectively, the managed network services, ArcMesh Platform license and maintenance services, cybersecurity monitoring and incident response services, professional services (including implementation, migration, and optimization services), and all other services described in the Service Descriptions (Exhibit A) and to be provided by Service Provider to Customer pursuant to this Agreement.
1.35 "Term" means the Initial Term together with any Renewal Terms, as described in Sections 2.2 and 2.3.
1.36 "Total Contract Value" or "TCV" means the sum of Seventy-Five Million Dollars ($75,000,000), representing the aggregate Fees payable by Customer to Service Provider over the five (5)-year Initial Term (calculated as $15,000,000 ACV × 5 years), exclusive of any Fees attributable to Renewal Terms or change orders.
1.37 "Transition/Wind-Down Escrow Deposit" means the amounts deposited by Customer into the escrow account maintained by the Escrow Agent, as described in Section 16.2 and the Escrow Agreement, for the purpose of securing funds to facilitate the orderly transition of Services upon expiration or termination of this Agreement.
1.38 "Uncapped Claims" has the meaning set forth in Section 13.6.
1.39 "Updates and Upgrades" means all updates, patches, bug fixes, security patches, minor version releases, major version releases, and upgrades to the ArcMesh Platform that Service Provider makes generally available to its customers during the Term.
1.40 "Wind-Down Period" means the period following the effective date of expiration or termination of this Agreement during which Service Provider provides transition assistance to Customer in accordance with Section 16.1, not to exceed twelve (12) months.
1.41 "Work Product" has the meaning set forth in Section 10.3.
ARTICLE 2 — TERM
Section 2.1 — Effective Date and Commencement. This Agreement shall become effective as of the Effective Date. The Parties acknowledge and agree that the signing and closing of this Agreement are simultaneous events occurring on the Effective Date, and that the Services shall commence on the Effective Date, subject to the satisfaction or waiver of the conditions precedent set forth in Article 9. From and after the Effective Date, Service Provider shall commence performance of the Services in accordance with the implementation timeline set forth in Exhibit A and the Transition Services Side Letter.
Section 2.2 — Initial Term. The initial term of this Agreement (the "Initial Term") shall commence on the Effective Date and shall continue for a period of five (5) years, expiring at 11:59 p.m. Eastern Time on June 8, 2028, unless this Agreement is earlier terminated in accordance with the provisions of Article 15 or otherwise as expressly provided herein. During the Initial Term, the Total Contract Value shall be Seventy-Five Million Dollars ($75,000,000), payable in accordance with the Fee structure and payment terms set forth in Article 5 and Exhibit C.
Section 2.3 — Renewal Terms. Upon expiration of the Initial Term, this Agreement shall automatically renew for up to two (2) successive renewal terms of two (2) years each (each, a "Renewal Term"), unless either Party provides the other Party with written notice of non-renewal at least one hundred eighty (180) days prior to the expiration of the then-current term (whether the Initial Term or a Renewal Term, as applicable). Any such notice of non-renewal shall be delivered in accordance with the notice provisions set forth in Article 23. For the avoidance of doubt, if the Initial Term is not renewed, this Agreement shall expire on June 8, 2028. If the first Renewal Term is entered into and not subsequently terminated, the first Renewal Term shall expire on June 8, 2030. If the second Renewal Term is entered into and not subsequently terminated, the second Renewal Term shall expire on June 8, 2032. Fees applicable during any Renewal Term shall be determined in accordance with Exhibit C, including applicable annual escalation provisions.
Section 2.4 — Effect of Expiration. Upon the expiration or termination of this Agreement for any reason, those provisions of this Agreement that by their nature are intended to survive expiration or termination, including, without limitation, the provisions of Article 10 (Intellectual Property), Article 12 (Confidentiality), Article 13 (Indemnification), Article 17 (Limitation of Liability), Article 19 (Governing Law; Jurisdiction), Article 20 (Dispute Resolution), Section 16 (Transition Assistance and Escrow), and any accrued payment obligations, shall continue in full force and effect in accordance with their respective terms. The expiration or termination of this Agreement shall not relieve either Party of any obligation or liability that accrued prior to the effective date of such expiration or termination.
ARTICLE 3 — SCOPE OF SERVICES
Section 3.1 — Services. During the Term, Service Provider shall provide Customer with the Services described in the Service Descriptions set forth in Exhibit A (Statement of Work), including, without limitation, the following:
(a) Managed WAN Services. Service Provider shall provide managed wide-area network services across all three hundred forty (340) Managed Nodes located in twenty-eight (28) states within the United States and three (3) provinces within Canada, as identified in Schedule 1. Such managed WAN services shall include circuit management, network configuration, change management, capacity planning, and day-to-day operational support for the Customer's enterprise network.
(b) SD-WAN Deployment and Optimization. Service Provider shall deploy, configure, and optimize a software-defined wide-area network architecture utilizing the ArcMesh Platform (version 4.2, as updated during the Term). SD-WAN services shall include intelligent path selection, application-aware routing, dynamic bandwidth allocation, WAN optimization, and policy-based traffic management across all Managed Nodes.
(c) 24×7 Network Operations Center (NOC) Monitoring. Service Provider shall provide continuous, twenty-four (24) hours per day, seven (7) days per week, three hundred sixty-five (365) days per year network monitoring, fault detection, event correlation, and incident management from Service Provider's Network Operations Center facilities located in Reston, Virginia and Winnipeg, Manitoba, Canada. The NOC shall serve as the primary point of contact for network-related incidents and shall maintain staffing levels sufficient to ensure compliance with the response time commitments set forth in the Service Level Agreement (Exhibit B).
(d) Quarterly Network Performance Reviews. Service Provider shall conduct quarterly network performance reviews and deliver written optimization reports to Customer's designated service delivery manager. Such reports shall include trending analysis, capacity utilization metrics, network availability statistics, security incident summaries, and recommendations for performance improvements.
(e) Migration from Legacy Infrastructure. Service Provider shall manage the migration of Customer's network infrastructure from the Legacy Infrastructure (the existing MPLS network provided by Greystone Halcyon Software) to the ArcMesh Platform and managed SD-WAN services. The Migration shall be completed in three (3) phases over a period of eighteen (18) months from the Effective Date, as further detailed in the Transition Services Side Letter entered into by the Parties concurrently herewith. Phase 1 shall encompass the deployment of ArcMesh overlay and pilot migration of approximately one hundred (100) nodes; Phase 2 shall encompass the migration of an additional one hundred forty (140) nodes; and Phase 3 shall encompass the migration of the remaining one hundred (100) nodes and final decommissioning of Legacy Infrastructure circuits.
(f) Cybersecurity Services. Service Provider shall provide cybersecurity monitoring, threat detection, vulnerability assessment, and incident response services for the managed network perimeter. Such cybersecurity services shall include real-time threat intelligence feeds, intrusion detection and prevention, distributed denial-of-service ("DDoS") mitigation, firewall management, and security event logging and analysis, all as further described in Exhibit A.
(g) Dedicated Service Delivery Manager. Service Provider shall assign a dedicated service delivery manager to the Customer account who shall serve as Customer's primary point of contact for all service-related matters, including escalation management, service improvement initiatives, and coordination of professional services engagements. The assigned service delivery manager shall be subject to Customer's reasonable approval, and Service Provider shall not reassign or replace such individual without providing Customer with at least thirty (30) days' prior written notice and an opportunity to interview the proposed replacement.
Section 3.2 — Service Levels. Service Provider shall perform the Services in accordance with the service levels, performance standards, and key performance indicators set forth in the Service Level Agreement (Exhibit B). Without limiting the generality of the foregoing, Service Provider shall maintain a network availability target of not less than ninety-nine and ninety-five hundredths percent (99.95%) monthly uptime, measured on a per-node basis, across all Managed Nodes. The methodology for measuring network availability, scheduled maintenance windows, and exclusions from availability calculations are set forth in Exhibit B. Service Provider's failure to meet the SLA targets shall entitle Customer to Service Credits in accordance with Article 7.
Section 3.3 — Node Locations. The Services shall be provided to and at the Managed Nodes identified in Schedule 1 (Node Locations) attached hereto. Schedule 1 sets forth, for each Managed Node, the physical address, circuit type, bandwidth allocation, and service tier applicable to such node. The Parties may add, remove, or modify Managed Nodes from time to time by mutual written agreement in accordance with the change order procedures set forth in Section 3.4. Any addition of nodes shall be subject to the pricing provisions of Exhibit C and the MFN protections of Article 6 and Schedule 3.
Section 3.4 — Changes to Scope. Any material change to the scope, volume, or specifications of the Services, including the addition or removal of Managed Nodes, changes to service tier classifications, modifications to the Migration timeline, or the engagement of Service Provider for new or additional professional services not contemplated by Exhibit A, shall require a written amendment or change order executed by duly authorized representatives of both Parties. Each change order shall describe in reasonable detail the proposed change, the impact on Fees (if any), the timeline for implementation, and any modifications to the applicable service levels. Service Provider shall not be obligated to perform work outside the scope of this Agreement and the applicable change orders without such written authorization.
ARTICLE 4 — ARCMESH PLATFORM LICENSE
Section 4.1 — License Grant. Subject to the terms and conditions of this Agreement, including the license restrictions set forth in Section 4.2 and the Acceptable Use Policy (Exhibit D), Service Provider hereby grants to Customer, and Customer hereby accepts, a non-exclusive, non-transferable (except as expressly permitted under Section 14.2), limited license to access and use the ArcMesh Platform (version 4.2, as updated from time to time with Updates and Upgrades provided pursuant to Section 4.3) solely in connection with the receipt and use of the Services during the Term. The license granted herein is limited to Customer's internal business operations and the management of Customer's enterprise network across the Managed Nodes. Customer may permit its employees, contractors, and agents to access and use the ArcMesh Platform solely for purposes of receiving the Services, provided that Customer shall remain responsible for such individuals' compliance with the terms and conditions of this Agreement.
Section 4.2 — License Restrictions. Customer acknowledges that the ArcMesh Platform is the proprietary property of Service Provider and is protected by applicable intellectual property laws. Customer shall not, and shall not permit any third party to:
(a) sublicense, distribute, sell, lease, rent, lend, or otherwise transfer the ArcMesh Platform or any rights therein to any third party;
(b) reverse engineer, decompile, disassemble, or otherwise attempt to derive or discover the source code, object code, algorithms, data structures, or underlying ideas or architecture of the ArcMesh Platform, except to the extent expressly permitted by applicable law notwithstanding a contractual prohibition to the contrary;
(c) modify, adapt, translate, or create derivative works based upon the ArcMesh Platform, except for custom configurations and integrations performed by Service Provider on Customer's behalf as part of the Services;
(d) remove, alter, or obscure any proprietary notices, labels, trademarks, or copyright legends affixed to or embedded in the ArcMesh Platform;
(e) use the ArcMesh Platform for purposes outside the licensed scope described herein and in the Acceptable Use Policy (Exhibit D), including using the ArcMesh Platform to provide network management services to any third party; or
(f) use the ArcMesh Platform in any manner that violates applicable law or infringes the rights of any third party.
Section 4.3 — Updates and Upgrades. During the Term, Service Provider shall provide all Updates and Upgrades to the ArcMesh Platform as part of the ArcMesh Platform license and maintenance fee set forth in Section 5.1(b) and Exhibit C, at no additional cost to Customer. Service Provider shall provide Customer with reasonable advance notice of any material Updates or Upgrades, including a description of the changes, new features, and any required actions on Customer's part. Service Provider shall coordinate the deployment of Updates and Upgrades with Customer's designated service delivery manager to minimize disruption to the Services. Notwithstanding the foregoing, Service Provider may deploy critical security patches on an expedited basis without prior notice, provided that Service Provider shall notify Customer promptly following such deployment.
Section 4.4 — Ownership. All right, title, and interest in and to the ArcMesh Platform, including all intellectual Property rights therein, are and shall remain the sole and exclusive property of Service Provider. Nothing in this Agreement shall be construed as transferring, assigning, or conveying to Customer any ownership interest in or to the ArcMesh Platform or any component thereof. Customer's rights with respect to the ArcMesh Platform are limited to the license expressly granted in Section 4.1, and no other rights are granted by implication, estoppel, or otherwise.
ARTICLE 5 — FEES AND PAYMENT
Section 5.1 — Fee Structure. In consideration of Service Provider's performance of the Services and the license grant set forth in Article 4, Customer shall pay Service Provider the Fees set forth in Exhibit C (Pricing Schedule and Fee Structure). The Fee structure is as follows:
(a) Managed Network Services (Operations, Monitoring, NOC). Ten Million Five Hundred Thousand Dollars ($10,500,000) per year, representing seventy percent (70%) of the Annual Contract Value. This fee component encompasses all managed WAN services, 24×7 NOC monitoring, fault management, configuration management, circuit management, and quarterly performance reviews described in Section 3.1.
(b) ArcMesh Platform License and Maintenance. Three Million Dollars ($3,000,000) per year, representing twenty percent (20%) of the Annual Contract Value. This fee component encompasses the license to access and use the ArcMesh Platform as described in Article 4, all Updates and Upgrades during the Term, platform support services, and ongoing maintenance.
(c) Professional Services (Implementation, Migration, Optimization). One Million Five Hundred Thousand Dollars ($1,500,000) per year, representing ten percent (10%) of the Annual Contract Value. This fee component encompasses implementation services, Migration-related professional services, network optimization consulting, and other professional services engagements described in Exhibit A, subject to the change order provisions of Section 3.4.
The total Annual Contract Value is Fifteen Million Dollars ($15,000,000). The Total Contract Value over the five (5)-year Initial Term is Seventy-Five Million Dollars ($75,000,000). The Monthly Run-Rate is One Million Two Hundred Fifty Thousand Dollars ($1,250,000).
Section 5.2 — Invoicing. Service Provider shall invoice Customer on a monthly basis, in advance, on or before the first business day of each calendar month. Each invoice shall set forth in reasonable detail the Services covered, the applicable Fee components, any Service Credits earned during the preceding month, and the net amount due. Customer shall pay all undisputed amounts within thirty (30) days following Customer's receipt of a proper and complete invoice. Invoices shall be submitted electronically to Customer's designated accounts payable contact and shall reference this Agreement and the applicable purchase order number, if any.
Section 5.3 — Annual Escalation. Fees for the managed network services and ArcMesh Platform license and maintenance components are subject to annual escalation as set forth in Exhibit C. Any annual escalation shall take effect on each anniversary of the Effective Date, beginning on the first anniversary. The annual escalation mechanism, including the applicable index or percentage, escalation cap, and calculation methodology, is set forth in detail in Exhibit C.
Section 5.4 — Taxes.
(a) Each Party shall be solely responsible for all taxes imposed on its own income, capital, franchise, or similar taxes imposed on such Party by reason of its legal status, organizational form, or business activities generally.
(b) Customer shall be responsible for all applicable sales taxes, use taxes, value-added taxes, goods and services taxes ("GST"), harmonized sales taxes ("HST"), provincial sales taxes, and similar transaction-based taxes and governmental charges imposed on the Services or the Fees payable hereunder, except for taxes based on Service Provider's net income, gross receipts (to the extent imposed in lieu of income taxes), or capital. Service Provider shall separately state all applicable taxes on each invoice.
(c) If Customer is required by applicable law to withhold or deduct any taxes from payments to Service Provider, Customer shall gross up the payment so that the net amount received by Service Provider after withholding equals the full amount otherwise due. The Parties shall cooperate in good faith to minimize any applicable withholding taxes and to complete and file any forms or documents necessary to claim available exemptions or reduced withholding rates.
(d) Customer (Employer Identification Number: 84-3291067) and Service Provider (Employer Identification Number: 52-4178503) acknowledge that the Services are provided across twenty-eight (28) states within the United States and three (3) provinces within Canada, and that the tax obligations of the Parties under this Agreement may be subject to the tax laws and regulations of multiple jurisdictions. Each Party shall cooperate with the other in good faith to address cross-jurisdictional tax compliance matters, including the provision of resale certificates, exemption certificates, and other documentation reasonably requested by the other Party. The detailed tax provisions applicable to the Parties' obligations are set forth in Exhibit C.
Section 5.5 — Disputed Invoices. Customer may dispute any invoice or any line item of an invoice in good faith by providing written notice to Service Provider within thirty (30) days following Customer's receipt of such invoice. Such notice shall specify in reasonable detail the basis for the dispute and the disputed amount. The Parties shall use commercially reasonable efforts to resolve any invoice dispute within thirty (30) days following Service Provider's receipt of Customer's dispute notice. Notwithstanding any dispute, Customer shall pay all undisputed amounts in accordance with the payment terms set forth in Section 5.2. No interest shall accrue on disputed amounts during the pendency of a good faith dispute. Upon resolution of a dispute, any amounts determined to be owed shall be paid within fifteen (15) days of such resolution.
Section 5.6 — Late Payment. Any undisputed amounts not paid by Customer when due shall bear interest from the due date until paid in full at a rate equal to the lesser of (a) one and one-half percent (1.5%) per month (eighteen percent (18%) per annum) or (b) the maximum rate permitted by applicable law. The accrual of interest under this Section 5.6 shall not limit Service Provider's right to exercise any other remedies available under this Agreement or at law or in equity, provided that Service Provider shall provide Customer with written notice of any past-due amounts and a ten (10)-business day opportunity to cure prior to exercising any suspension or termination remedy.
ARTICLE 6 — MOST FAVORED NATION PRICING
Section 6.1 — MFN Warranty. Service Provider represents, warrants, and covenants that the per-unit pricing for managed network services charged to Customer under this Agreement shall not, at any time during the Term, exceed the lowest per-unit pricing offered by Service Provider to any other Comparable Customer (defined as any customer of Service Provider maintaining a contract or arrangement with Service Provider for managed network services encompassing two hundred (200) or more managed nodes) during the applicable trailing twelve (12)-month period. For purposes of this MFN provision, "per-unit pricing" means the total fees charged for managed network services (exclusive of one-time professional services fees and non-recurring charges) divided by the number of managed nodes under contract. The detailed benchmarking methodology, comparable customer criteria, exclusions, and other MFN-related provisions are set forth in Schedule 3 attached hereto.
Section 6.2 — MFN Audit Rights. Customer shall have the right, exercisable not more than once per calendar year, to audit or cause a nationally recognized independent accounting firm reasonably acceptable to both Parties to audit Service Provider's pricing records, contracts, and related documentation to verify Service Provider's compliance with the most favored nation pricing provisions of this Article 6 and Schedule 3. Service Provider shall cooperate with such audit and provide reasonable access to its pricing records, redacted as necessary to protect the identity of its other customers and proprietary commercial terms not relevant to the MFN analysis. The costs and expenses of any MFN audit shall be borne by Service Provider if such audit reveals a pricing differential in violation of the MFN warranty; otherwise, the costs and expenses of the audit shall be borne by Customer.
Section 6.3 — MFN Remediation. If an MFN audit conducted pursuant to Section 6.2 reveals a pricing differential in excess of three percent (3%) between the per-unit pricing charged to Customer and the lowest per-unit pricing offered to any Comparable Customer during the applicable trailing twelve (12)-month period, Service Provider shall:
(a) issue a retroactive credit to Customer in the full amount of the pricing differential (including the initial three percent (3%)) for the entire period during which the non-compliant pricing was in effect, such credit to be applied to Customer's account or refunded within forty-five (45) days following the final determination of the MFN violation; and
(b) adjust prospective pricing to the level required to bring Customer's per-unit pricing into compliance with the MFN warranty, such adjustment to take effect within thirty (30) days following the final determination of the MFN violation and to remain in effect for the balance of the then-current term.
Section 6.4 — Detailed Terms. The detailed most favored nation pricing provisions, including the benchmark methodology and calculation mechanics, the definition and qualification criteria for Comparable Customers, exclusions and carve-outs from the MFN comparison, dispute resolution procedures specific to MFN disputes, annual certification and reporting requirements of Service Provider, and the procedures and protocols governing the conduct of MFN audits, are set forth in Schedule 3 attached hereto and incorporated herein by reference. In the event of any conflict between the provisions of this Article 6 and Schedule 3, the provisions of Schedule 3 shall control.
ARTICLE 7 — SERVICE LEVELS AND SERVICE CREDITS
Section 7.1 — SLA Standards. Service Provider shall meet or exceed the service levels, performance standards, and key performance indicators set forth in the Service Level Agreement (Exhibit B) throughout the Term. Without limiting the generality of the foregoing, Service Provider shall maintain network availability of not less than ninety-nine and ninety-five hundredths percent (99.95%) monthly uptime, measured on a per-node basis across all Managed Nodes. Network availability shall be calculated in accordance with the methodology set forth in Exhibit B, which accounts for scheduled maintenance windows, agreed-upon exclusions, and the measurement intervals applicable to each service tier.
Section 7.2 — Service Credit Tiers. In the event that Service Provider fails to meet the network availability target of 99.95% monthly uptime for any Managed Node or group of Managed Nodes in any given calendar month, Customer shall be entitled to Service Credits against the monthly managed services fee (Monthly Run-Rate of $1,250,000) in accordance with the following tiered credit structure:
(a) Tier 1: 99.90% to 99.94% uptime. If measured network availability for the applicable month falls within the range of ninety-nine and ninety hundredths percent (99.90%) to ninety-nine and ninety-four hundredths percent (99.94%), inclusive, Customer shall receive a Service Credit equal to five percent (5%) of the Monthly Run-Rate, which equals Sixty-Two Thousand Five Hundred Dollars ($62,500) per month.
(b) Tier 2: 99.50% to 99.89% uptime. If measured network availability for the applicable month falls within the range of ninety-nine and fifty hundredths percent (99.50%) to ninety-nine and eighty-nine hundredths percent (99.89%), inclusive, Customer shall receive a Service Credit equal to ten percent (10%) of the Monthly Run-Rate, which equals One Hundred Twenty-Five Thousand Dollars ($125,000) per month.
(c) Tier 3: Below 99.50% uptime. If measured network availability for the applicable month falls below ninety-nine and fifty hundredths percent (99.50%), Customer shall receive a Service Credit equal to twenty percent (20%) of the Monthly Run-Rate, which equals Two Hundred Fifty Thousand Dollars ($250,000) per month.
Service Credits earned in any calendar month shall be applied as a credit against the Fees invoiced in the immediately following month. At Customer's election, Service Credits may instead be applied as a credit against any other outstanding invoice or refunded to Customer within thirty (30) days of Customer's written request.
Section 7.3 — Annual Credit Cap. The maximum aggregate Service Credits to which Customer shall be entitled in any twelve (12)-month period (measured from each anniversary of the Effective Date) shall not exceed thirty percent (30%) of the annual managed network services fees, which equals Three Million One Hundred Fifty Thousand Dollars ($3,150,000) per year (calculated as $10,500,000 × 30%). For the avoidance of doubt, this annual credit cap applies solely to Service Credits and does not limit Customer's rights or remedies under Section 7.4, Article 13, Article 15, or any other provision of this Agreement.
Section 7.4 — Material Breach. Notwithstanding the Service Credit provisions of Section 7.2 and the annual credit cap of Section 7.3, three (3) consecutive calendar months in which measured network availability falls below ninety-nine and fifty hundredths percent (99.50%) (i.e., three consecutive Tier 3 failures) shall constitute a material breach of this Agreement by Service Provider, entitling Customer to terminate this Agreement for cause pursuant to Section 15.2. In such event, the cure period set forth in Section 15.2(a) shall not apply, and Customer may terminate this Agreement immediately upon written notice to Service Provider. Customer's right to terminate under this Section 7.4 is in addition to, and not in lieu of, Customer's right to receive Service Credits for the applicable months.
Section 7.5 — SLA Reporting. Service Provider shall provide Customer with detailed monthly SLA performance reports within ten (10) business days following the end of each calendar month. Each report shall include, at a minimum: (a) measured network availability for each Managed Node and on an aggregate basis; (b) the number and duration of outages, degradations, and incidents; (c) root cause analysis for any incident resulting in downtime exceeding fifteen (15) minutes; (d) a calculation of any Service Credits earned during the reporting period; (e) trending data comparing current month performance to the trailing twelve (12) months; and (f) remedial actions taken or planned to address recurring performance issues. Service Provider shall make available to Customer a real-time dashboard accessible through the ArcMesh Platform providing visibility into network availability, incident status, and SLA compliance metrics.
Section 7.6 — Sole Remedy. Subject to Section 7.4, Service Credits shall be Customer's sole and exclusive remedy, and Service Provider's sole and exclusive liability, for Service Provider's failure to meet the service levels specified in the Service Level Agreement (Exhibit B). Nothing in this Section 7.6 shall be construed to limit or affect Customer's rights or remedies with respect to (a) a material breach of this Agreement triggering termination rights under Section 7.4 or Section 15.2, (b) Service Provider's indemnification obligations under Article 13, or (c) any claim arising from Service Provider's gross negligence, willful misconduct, or fraud.
ARTICLE 8 — REPRESENTATIONS AND WARRANTIES
Section 8.1 — Mutual Representations. Each Party hereby represents and warrants to the other Party, as of the Effective Date, that:
(a) Organization and Good Standing. It is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and is duly qualified to do business in each jurisdiction where the nature of its business or the ownership of its properties requires such qualification.
(b) Corporate Power and Authority. It has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder, and the execution, delivery, and performance of this Agreement are within its corporate powers.
(c) Due Authorization. The execution, delivery, and performance of this Agreement have been duly authorized by all necessary corporate action on the part of such Party, including all requisite board of directors' approvals and, if applicable, stockholder approvals, and no further corporate proceedings on the part of such Party are required to authorize this Agreement or the transactions contemplated hereby.
(d) Enforceability. This Agreement constitutes a legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
(e) No Conflicts. The execution, delivery, and performance of this Agreement do not and will not (i) violate such Party's certificate of incorporation, bylaws, or other organizational documents, (ii) violate any applicable law, rule, regulation, order, judgment, or decree binding upon such Party, or (iii) result in a breach of, or constitute a default under, any material contract, agreement, or instrument to which such Party is a party or by which it is bound.
Section 8.2 — Service Provider Representations. Service Provider additionally represents and warrants to Customer, as of the Effective Date and on an ongoing basis during the Term (except as otherwise specified), that:
(a) Professional Standards. The Services will be performed in a professional and workmanlike manner, consistent with generally accepted industry standards and practices applicable to managed network services providers of comparable size and scope, and in accordance with the Service Descriptions and Service Level Agreement.
(b) Non-Infringement. The ArcMesh Platform, as provided to Customer hereunder, and Customer's use of the ArcMesh Platform in accordance with the terms of this Agreement, do not and will not infringe, misappropriate, or otherwise violate any intellectual Property rights or other proprietary rights of any third party. Service Provider has not received any notice, claim, or demand from any third party alleging that the ArcMesh Platform infringes or misappropriates any such rights.
(c) Licenses and Permits. Service Provider holds, and shall maintain during the Term, all licenses, permits, certifications, and authorizations necessary to perform the Services and to operate its Network Operations Centers, including all applicable telecommunications licenses and authorizations required by the Federal Communications Commission, the Canadian Radio-television and Telecommunications Commission, and applicable state and provincial regulatory authorities.
(d) Regulatory Compliance. Service Provider is in material compliance with all applicable federal, state, provincial, and local telecommunications regulations, data protection laws, and industry standards applicable to the Services and Service Provider's business operations.
(e) No Pending Litigation. No litigation, arbitration, administrative proceeding, or governmental investigation is pending or, to Service Provider's knowledge after due inquiry, threatened against Service Provider that would reasonably be expected to materially impair Service Provider's ability to perform its obligations under this Agreement or to have a material adverse effect on Service Provider's business, financial condition, or results of operations.
(f) Ownership Disclosure. As of the Effective Date, the ownership of Service Provider's outstanding voting equity is as follows: (i) Ridgeline Capital Partners, LP — sixty-two percent (62%); (ii) Rajiv Sundaram (Chief Executive Officer) — eighteen percent (18%); (iii) Teresa Cho (Chief Technology Officer) — twelve percent (12%); and (iv) other employees and early investors — eight percent (8%). Service Provider shall promptly notify Customer of any material change to the foregoing ownership structure.
Section 8.3 — Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, NON-INFRINGEMENT, ACCURACY, RELIABILITY, COMPLETENESS, OR ANY WARRANTY ARISING FROM COURSE OF DEALING, COURSE OF PERFORMANCE, OR USAGE OF TRADE. EACH PARTY HEREBY DISCLAIMS ALL SUCH WARRANTIES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW.
ARTICLE 9 — CONDITIONS PRECEDENT TO CLOSING
Section 9.1 — Conditions to Customer's Obligations. The obligations of Customer under this Agreement are subject to the satisfaction or written waiver by Customer of each of the following conditions on or before the Effective Date:
(a) Accuracy of Representations and Warranties. The representations and warranties of Service Provider set forth in Sections 8.1 and 8.2 shall be true and correct in all material respects as of the Effective Date as though made on and as of such date (except for representations and warranties that speak as of a specific date, which shall be true and correct in all material respects as of such date).
(b) Officer's Certificate. Service Provider shall have delivered to Customer an Officer's Certificate, duly executed by Rajiv Sundaram, Chief Executive Officer of Service Provider, certifying as to the accuracy of Service Provider's representations and warranties, the performance of Service Provider's covenants and agreements required to be performed on or before the Effective Date, and the absence of any material adverse change in Service Provider's business, financial condition, or operations since the date of the most recent financial statements provided to Customer.
(c) Secretary's Certificate. Service Provider shall have delivered to Customer a Secretary's Certificate of Service Provider, duly executed by the Secretary or an Assistant Secretary of Service Provider, attaching and certifying as true, correct, and complete copies of: (i) the resolutions of the Board of Directors of Service Provider authorizing the execution, delivery, and performance of this Agreement and the transactions contemplated hereby; (ii) the Certificate of Incorporation of Service Provider, as amended to date; (iii) the Bylaws of Service Provider, as amended to date; (iv) a Certificate of Good Standing for Service Provider issued by the Secretary of State of the State of Delaware, dated within ten (10) days of the Effective Date; and (v) incumbency certificates for Rajiv Sundaram (Chief Executive Officer), Philip Hargreaves (Chief Financial Officer), and Nadia Okafor (General Counsel), certifying the name, title, and specimen signature of each such officer.
(d) Legal Opinion. Service Provider shall have delivered to Customer a written legal opinion of Whitfield Graves & Morrow LLP, counsel to Service Provider, addressed to Customer and dated as of the Effective Date, rendered by Douglas Fenn, Esq., opining as to (i) the due organization and valid existence of Service Provider under the laws of the State of Delaware, (ii) the due authorization by Service Provider of this Agreement and the transactions contemplated hereby, (iii) the enforceability of this Agreement against Service Provider in accordance with its terms (subject to customary qualifications and assumptions), and (iv) the execution, delivery, and performance of this Agreement not resulting in any violation of Service Provider's charter documents, bylaws, or any material agreement to which Service Provider is a party, in each case in form and substance reasonably satisfactory to Customer and its counsel, Calderwood & Harkness LLP.
(e) Certificates of Insurance. Service Provider shall have delivered to Customer certificates of insurance evidencing the insurance coverage required by Exhibit F (Insurance Requirements), naming Customer as an additional insured, and otherwise in compliance with the requirements of Article 21.
(f) Escrow Agreement. Customer, Service Provider, and the Escrow Agent (Dravello National Bank) shall have executed and delivered the Escrow Agreement, in form and substance reasonably satisfactory to each Party.
Section 9.2 — Conditions to Service Provider's Obligations. The obligations of Service Provider under this Agreement are subject to the satisfaction or written waiver by Service Provider of each of the following conditions on or before the Effective Date:
(a) Accuracy of Representations and Warranties. The representations and warranties of Customer set forth in Section 8.1 shall be true and correct in all material respects as of the Effective Date as though made on and as of such date.
(b) Officer's Certificate. Customer shall have delivered to Service Provider an Officer's Certificate, duly executed by Warren Liang, President of Customer, certifying as to the accuracy of Customer's representations and warranties and the performance of Customer's covenants and agreements required to be performed on or before the Effective Date.
(c) Initial Escrow Deposit. Customer shall have deposited the initial Transition/Wind-Down Escrow Deposit in the amount of Seven Hundred Fifty Thousand Dollars ($750,000) into the escrow account maintained at Dravello National Bank (account reference number: FNB-ESC-2023-07742), in accordance with Section 16.2 and the Escrow Agreement.
Section 9.3 — Simultaneous Signing and Closing. The Parties acknowledge and agree that the signing and closing of this Agreement shall occur simultaneously on the Effective Date. All actions required to be taken at the closing shall be deemed to have occurred simultaneously, and no action shall be deemed to have been taken and no document shall be deemed to have been delivered until all actions have been taken and all documents have been delivered.
ARTICLE 10 — INTELLECTUAL PROPERTY
Section 10.1 — Service Provider IP. All right, title, and interest in and to the ArcMesh Platform, including all intellectual Property rights therein, and all other pre-existing intellectual Property of Service Provider and its licensors, shall remain the sole and exclusive property of Service Provider. Nothing in this Agreement shall be construed to transfer, assign, or convey to Customer any ownership interest in or to Service Provider's intellectual Property, and Customer hereby acknowledges and agrees that its rights with respect to the ArcMesh Platform are limited to the license expressly granted in Section 4.1. To the extent that any right, title, or interest in Service Provider's intellectual Property is deemed to vest in Customer by operation of law, Customer hereby irrevocably assigns and transfers to Service Provider all such right, title, and interest.
Section 10.2 — Customer IP. All right, title, and interest in and to Customer Data and all pre-existing intellectual Property of Customer and its Affiliates shall remain the sole and exclusive property of Customer. Service Provider shall have no rights in or to Customer Data or Customer's pre-existing intellectual Property except as expressly granted in this Agreement in connection with Service Provider's performance of the Services. Service Provider shall not use Customer Data for any purpose other than performing the Services, and Service Provider shall not disclose Customer Data to any third party except as expressly permitted by this Agreement or as directed in writing by Customer.
Section 10.3 — Work Product. Any custom configurations, integrations, scripts, documentation, reports, or other deliverables created specifically for Customer by Service Provider in the course of providing the Services (collectively, "Work Product") shall be owned by Customer, and Service Provider hereby irrevocably assigns and transfers to Customer all right, title, and interest in and to such Work Product, including all intellectual Property rights therein. Service Provider shall execute such documents and take such actions as Customer may reasonably request to evidence or perfect Customer's ownership of the Work Product. Notwithstanding the foregoing, Service Provider shall retain all right, title, and interest in its underlying pre-existing intellectual Property, including the ArcMesh Platform and any tools, methodologies, frameworks, libraries, or other materials owned by Service Provider prior to the Effective Date or developed independently of the Services, and Customer is hereby granted a non-exclusive, perpetual, royalty-free, fully paid-up license to use such underlying Service Provider IP solely to the extent embedded in or necessary for the use of the Work Product.
Section 10.4 — Feedback. Customer may, from time to time, provide Service Provider with suggestions, ideas, enhancement requests, recommendations, or other feedback regarding the ArcMesh Platform or the Services ("Feedback"). Customer hereby grants to Service Provider a perpetual, irrevocable, worldwide, royalty-free, fully paid-up, non-exclusive license to use, reproduce, modify, create derivative works of, distribute, display, perform, and otherwise exploit any Feedback for any purpose, including the improvement and enhancement of the ArcMesh Platform and Service Provider's other products and services, without obligation of any kind to Customer. Customer acknowledges that Service Provider may independently develop features, functionality, or enhancements similar to Feedback, and nothing in this Agreement shall restrict Service Provider's right to do so.
ARTICLE 11 — DATA SECURITY AND PRIVACY
Section 11.1 — Data Security Obligations. Service Provider shall implement and maintain, throughout the Term, comprehensive administrative, technical, and physical safeguards to protect Customer Data from unauthorized access, use, disclosure, alteration, or destruction, in accordance with the Data Security and Privacy Requirements set forth in Exhibit E attached hereto. Without limiting the foregoing, Service Provider shall comply with all applicable data protection and privacy laws and regulations, including the Health Insurance Portability and Accountability Act ("HIPAA") (to the extent applicable), the California Consumer Privacy Act ("CCPA") and its successor the California Privacy Rights Act ("CPRA"), the Personal Information Protection and Electronic Documents Act ("PIPEDA") (Canada), and applicable provincial privacy legislation in Canada.
Section 11.2 — Data Breach Notification. In the event of any actual or reasonably suspected unauthorized access to, acquisition of, use of, or disclosure of Customer Data (a "Data Breach"), Service Provider shall notify Customer of such Data Breach within the timeframes specified in Exhibit E (and in no event later than seventy-two (72) hours after Service Provider's discovery of the Data Breach). Such notification shall include, to the extent known at the time: (a) the nature and scope of the Data Breach; (b) the categories and approximate number of records affected; (c) a description of the measures taken or proposed to be taken to address and mitigate the Data Breach; and (d) the name and contact information of Service Provider's designated incident response coordinator. Service Provider shall cooperate with Customer in investigating and remediating the Data Breach and shall provide regular updates to Customer until the Data Breach has been fully resolved.
Section 11.3 — Data Localization. Service Provider shall process, store, and maintain Customer Data only in data

Calderwood & Harkness LLP Matter No. 1022-00008

MASTER SERVICES AGREEMENT

NORTHGATE AMERICAS, INC.

CEDARPOINT SYSTEMS INTEGRATION, INC.

MASTER SERVICES AGREEMENT

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