MASTER SERVICE AGREEMENT

 

EXECUTION VERSION

MASTER SERVICE AGREEMENT

This Master Service Agreement (this “ Agreement ”), dated as of October 9, 2009 (the “ Effective Date ”), is by and between deltathree, Inc., a Delaware corporation (“ D3 ”), and Ojo Service LLC, a Pennsylvania limited liability company (“ OJO ”; and together with D3, the “ Parties ”).

Recitals:

WHEREAS, D3 is a provider of Voice over Internet Protocol (“ VoIP ”) telephony and video services;

WHEREAS, OJO is interested in purchasing the VoIP telephony and video services from D3; and

WHEREAS, the Parties wish to enter into this Agreement to provide the terms and conditions pursuant to which D3 shall provide to OJO, and OJO shall purchase from D3, the VoIP telephony and video services.

NOW, THEREFORE, in consideration of the foregoing recitals and the conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:

1.       Scope of Agreement . Subject to the terms and conditions of this Agreement, D3 shall provide the Services as described and in conformance with the Statement of Work attached as Appendix A to this Agreement and any additional Statements of Work that may be attached to and incorporated into this Agreement by the Parties from time to time during the Term (each, a “ Statement of Work ”).  In the event of any inconsistency or conflict between a term contained in this Agreement and a term contained in any Statement of Work, the term contained in such Statement of Work shall govern as to such Statement of Work.  The Parties acknowledge that each Statement of Work may be subject to revision as mutually agreed by the Parties in order to better reflect the intent of this Agreement and to address any issues or concerns that arise during the course of the implementation and launch of the Solution, or otherwise during the Term.  Either Party may request changes or additions to the terms and conditions of this Agreement or any Statement of Work, by submitting such request to the other Party in writing.  Following the submission of any such request, the Parties shall, in good faith, attempt to negotiate an appropriate amendment to this Agreement or the applicable Statement of Work.  Requested changes or additions shall be incorporated into this Agreement or the applicable Statement of Work only upon the express written agreement of the Parties as to the terms and conditions thereof.

2.       Definitions . As used in this Agreement, the Appendices hereto or any Statement of Work, the following words and phrases shall have the following meanings:

 

“ Affiliate ” means, with respect to either Party, any other person, entity or enterprise that, directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with such person, entity or enterprise; provided that , (a) with respect to D3, the following entities shall not be considered Affiliates: WorldGate Communications, Inc. and its direct or indirect subsidiaries (including OJO) and (b) with respect to OJO, the following entities shall not be considered Affiliates: D3 and its direct or indirect subsidiaries.

“ Bankruptcy Code ” means Chapter 7 or Chapter 11 of the United States bankruptcy code (Title 11 of the United States Code).

“ Claim ” means any actions, suits, claims, demands, debts, complaints, sums of money, reckonings, covenants, contracts (whether oral or written, express or implied from any source), agreements, warranties, controversies, promises, judgments, extents, executions, variances, trespasses, liabilities or obligations of any kind whatsoever, in Law or equity, and causes of action of every kind and nature, or otherwise (including claims for damages, costs, expenses, and attorneys’, brokers’ and accountants’ fees and expenses) asserted, commenced or threatened against a Party or any of its Representatives.

“ Confidential Information ” means (a) any and all information concerning either Party or its Representatives which has been or is, in the future, furnished by such Party (the “ Provider ”) or any of its Representatives to the other Party (the “ Recipient ”) or any of its Representatives, orally or in writing (whatever the form or storage medium), including, without limitation, information concerning its subsidiaries, Representatives, businesses, operations, markets, products, product specifications, designs, documentation (including internal control and process documentation) technical data, trade secrets, processes, computer programs (in object or source code form), know-how, research and development, financial condition, results of operations, projections, strategies, marketing information, contracts, customers, employees and prospects, including, with respect to OJO, any OJO Property, and (b) any and all notes, analyses, compilations, studies or other documents prepared by the Recipient or any of its Representatives containing or reflecting any Confidential Information described in clause (a). The term “Confidential Information” does not include information which the Recipient demonstrates: (i) was or becomes generally available to or known by the public (other than as a result of a disclosure directly or indirectly by the Recipient or any of its Representatives who received such information pursuant to this Agreement or any Statement of Work); or (ii) was or becomes available to the Recipient or any of its Representatives on a non-confidential basis, prior to its disclosure to the Recipient by the Provider or its Representatives; provided that the source of such information is not otherwise known by the Recipient after reasonable investigation to be bound by a confidentiality agreement with the Provider or any of its Representatives, or to be under a contractual, legal, fiduciary or other obligation to the Provider or any of its Representatives not to transmit the information to the Recipient.

 

 

“ Control ” (including the correlative terms “ Controls ”, “ Controlled by ”, and “ under common   Control with ”) means, with respect to any person, entity or enterprise, the power, directly or indirectly, either to (i) vote a majority of the voting shares or other voting interests in such person, entity or enterprise for the election of directors or other governing body of such person, entity or enterprise or (ii) direct or cause the direction of the management and policies of such person, entity or enterprise, whether through the ownership of voting securities, by contract or otherwise.

“ CPE ” means a hardware device to be used in connection with the Services contemplated by the Solution, whether via traditional audio-only telephony or via video communication (i.e., videophone technology).

“ D3 Certified CPE ” means (a) the Linksys PAP2T and Linksys SPA2102 and (b) any other CPE certified by D3 during the Term.

“ Data Security Breach ” means the unintentional loss of Personal Data, the inadvertent disclosure of Personal Data, or the unauthorized access to or unlawful or unauthorized processing or transfer of Personal Data or any other type of information security breach, loss or corruption involving Personal Data.

“ Documentation ” means any operation instructions, technical manuals, user manuals, system-administrator manuals, training materials, installation instructions, installation software, specifications and all other written materials in hard copy or electronic format, that are provided by D3 to OJO and that describe the functionality and proper installation and use of the Solution.

“ FCC ” means the United States Federal Communications Commission.

“ Governmental Authority ” means any federal, state, county, municipal, district or local government or government body, or any public administrative or regulatory agency, political subdivision, commission, court, board or body, or representative of any of the foregoing, foreign or domestic, of, or established by, any such government or government body that has authority in respect to a particular matter.

“ Intellectual Property ” means all of the following in any jurisdiction throughout the world: (a) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications, and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations thereof, (b) Marks and rights in telephone numbers, including all goodwill associated therewith, (c) all copyrightable works, all copyrights, and all applications, registrations, and renewals in connection therewith, (d) all mask works and all applications, registrations, and renewals in connection therewith, (e) all trade secrets and Confidential Information, (f) all computer software (including source code, executable code, data, databases, and related documentation), (g) all advertising and promotional materials and (h) all copies and tangible embodiments of any of the foregoing (in whatever form or medium).

“ Launch Date ” means the date when OJO first makes the Solution commercially available to its Subscribers.

 

“ Law ” means any statute, law (including common law), constitution, treaty, charter, ordinance, code, rule, award, injunction, judgment, decree, order, ruling, subpoena or verdict, regulation and any other binding requirement or determination of any Governmental Authority.

“ Liability ” means all losses, injuries, damages, liabilities, indebtedness, obligations, deficiencies, demands, fines, penalties, judgments, liens and claims, and all related expenses, costs, charges and fees, including reasonable attorneys’ fees and disbursements, reasonable and necessary consultants’, computer forensic examination and other professional fees and disbursements, costs of investigation, litigation, collection, settlement, and judgment, and any taxes, interest and penalties with respect to any of the foregoing.

“ Marks ” means all trade names, trademarks, service names, service marks, logos, trade dress, slogans, insignia, corporate names, symbols, tags, legends and Internet domain names, together with all translations, adaptations, derivations, and combinations thereof, and all applications, registrations, and renewals in connection therewith.

“ New Release ” means a release of the Solution which consists of a new version with substantial enhancements, added functionality, or new features typically denoted by a change to the number to the left of the first decimal point (e.g., a change from 2.x to 3.x).

“ Personal Data ” means any information supplied by OJO or a Subscriber that identifies, relates to, describes, or is capable of being associated with, a particular individual, including his or her name, signature, social security number, other identification number, physical characteristics or description, home or business address or location, email address, telephone number, passport number, driver's license or state identification card number, insurance policy number, education, employment, employment history, bank account number, credit card number, debit card number, union or trade association status, supervisor name, medical or health information, or any other sensitive information related thereto.

“ Pricing Schedule ” means the pricing schedule attached as Appendix B to this Agreement, which reflects D3’s charges to OJO for each aspect of the Solution and the professional fees and other amounts that may be charged to OJO (provided that all such charges, fees and other amounts may be revised as set forth in a Statement of Work).

“ Processing ” means any operation or set of operations which is performed upon Personal Data, whether or not by automatic means, such as collection, recording, organization, storage, adaptation or alteration, retrieval, use, disclosure by transmission, dissemination or otherwise making available, alignment or combination, blocking, erasure, or destruction.

“ Representative ” means, with respect to either Party, such Party’s Affiliates and its and their officers, directors, majority stockholders, members, partners, employees, partners, attorneys, accountants, consultants, contractors, agents, financial and other advisors, heirs, successors and assigns.

 

“ Retail Subscribers ” means persons who have been registered for the provision of the Services contemplated by the Solution and have an active account capable of utilizing the Services contemplated by the Solution in accordance with the terms of this Agreement or any Statement of Work.

“ Services ” means VoIP telephony and video services.

“ SIP ” means Session Initiation Protocol, a protocol that is used to manage telephony over internet protocol networks.

“ Software ” means the computer programs provided by D3 in connection with the Service, including all third party computer programs.

“ Solution ” means all Software, Documentation, Updates, CPEs, training, technology and materials used to provide D3’s Services to OJO under this Agreement or any Statement of Work, whether owned by D3 or a third party, that will enable OJO to deploy SIP-based Services, including providing (i) Services to Wholesale Subscribers (with the ability to white label any and all sign-up and member-center user interfaces for such Wholesale Subscribers and track (both individually and on an aggregate basis) the Retail Subscribers obtained by such Wholesale Subscriber) and (ii) Services to Retail Subscribers.

“ Source Code ” means the human readable form of the Software and any related materials, including flow charts, logic diagrams and listings, whether in machine or human readable form.

“ Subscriber ” means any Wholesale Subscriber or any Retail Subscriber.

“ Technical and Organizational Security Measures ” means measures aimed at protecting Personal Data against accidental or unlawful destruction or accidental loss, alteration, unauthorized disclosure or access, in particular where the Processing involves the transmission of data over a network, and against all other unlawful forms of Processing.

“ Tier 1 ” means agents that assist with all order entry, fulfillment, provisioning, billing, account maintenance, adjustments, cancellations and general isolation of issues to a CPE, the ISP or the network.

“ Tier 2 ” means technicians that isolate issues to a CPE, the ISP or the network, but has a greater focus/experience level in resolving quality of service issues; in addition, Tier 2 technicians generally has tenure and experience, handles escalated situations, performs remote diagnostics, provides troubleshooting assistance and approves RMAs.

 

 

“ Tier 3 ” means technicians in the network operations center which addresses network issues, such as patterns of call failures to a certain geographical area, patterns of call quality issues, patterns of customer inability to access network features, patterns of customer inability to access the member center, the call center’s inability to access the CSI, etc.  As a general rule, individual phone issues would not be handled by Tier 3.

“ Transition Breach ” means D3’s material breach of its transition obligations under this Agreement and any Statement of Work.

“ Triggering Event ” means, with respect to a Party or any of its direct or indirect subsidiaries, any of the following:

a.      the cessation of normal business operations or the cessation of providing the Solution to OJO in breach of this Agreement or any Statement of Work;

b.      the making of a general assignment for the benefit of creditors;

c.      institution of a proceeding under any state corporation or similar law for the purposes of dissolution;

d.      institution of a proceeding under any state insolvency or similar law for the purpose of its bankruptcy or liquidation;

e.      a voluntary filing of a petition for relief under the Bankruptcy Code;

f.      the filing of an involuntary petition in bankruptcy that is not dismissed within 60 calendar days after its filing;

g.      the admission in writing of a failure to generally pay its debts as such debts become due; or

h.      the occurrence of a Force Majeure event with respect to which D3 has failed to provide reasonably equivalent back-up or disaster recovery within ten (10) days.

“ Updates ” means any (i) New Releases, (ii) new versions or material, or (iii) updates, changes, enhancements or modifications to the Solution, in each case at such time as they are capable of being deployed by D3 without a service or functionality degradation or loss.

“ Wholesale Subscriber ” means any customer of OJO to which OJO sells the Solution on a wholesale basis to enable such customer to resell the Services contemplated by the Solution to Retail Subscribers.

 

 

3.      Licenses for Solution.

a.      License of Solution to OJO .  D3 hereby grants to OJO (i) a non-exclusive, worldwide, royalty free, fully paid-up license to use, copy, modify, distribute, display and sublicense with respect to all Documentation, CPEs, training and materials used to provide D3’s Services to OJO under this Agreement or any Statement of Work, whether owned by D3 or a third party, and (ii) a non-exclusive, worldwide, royalty free, fully paid-up license to use, distribute, display and sublicense with respect to Software, Updates or Technology, in each case, in order to provide the Solution to Subscribers (including for their use in connection with their use or resale of the Solution) and to administer, support, market and provide any services related to the Solution.  Notwithstanding the foregoing, OJO shall not be provided access to the Source Code and D3 does not grant any license to OJO with respect to copying or modifying the Software, Updates or Technology.

b.      Updates .  Upon prior written notice to OJO, D3 shall deliver to OJO and Subscribers any Updates.

c.      Features and Functionality Review .  At OJO’s request, but not more frequently than once every three months and simultaneously with the Pricing Review described in Section 6(e) below, D3 will meet telephonically with OJO to review the features and functionality of the Solution.  At such meetings, the Parties will evaluate the revisions or modifications to the Solution that may be necessary to maintain OJO’s competitive position within the market for the provision of the Services contemplated by the Solution.  Neither Party shall be obligated to implement or pay for any such revision or modification in the absence of a written amendment to this Agreement or the applicable Statement of Work setting forth the terms and conditions thereof.

4.      Rate Plans .  As specified in the applicable Statement of Work, the Parties will agree on the rate plans, with specific rates and other elements to be agreed upon by the Parties, that may be offered to Subscribers.  OJO shall identify to D3   in writing which rate plans it has selected no later than the date specified in the applicable Statement of Work.  Upon receipt of such notice from OJO, D3   shall implement the designated rate plans in accordance with the applicable Statement of Work.  Any delay in the delivery of such notice shall result in a delay of a like period in D3’s implementation of the designated rate plan.

5.      CPE .

a.      Supply of CPEs .  D3 has certified the D3 Certified CPEs and the Iris 3000-AU Video Phone on the D3 network.  D3 shall promptly provide OJO with any updates to the list of CPEs certified in connection with the Services contemplated by the Solution.  D3 will supply D3 Certified CPEs that have been purchased by OJO from D3 for sale to Subscribers according to the terms set forth in the applicable Statement of Work.  OJO may purchase D3 Certified CPEs from D3 or any other source.  OJO will be required to prepare, and D3 will be required to provide reasonable assistance in preparing, any user manuals, quick start guides and any necessary installation software that OJO wants to be provided to the Subscribers.  D3 agrees to use commercially reasonable efforts to work with OJO to ensure that the Iris 3000-US is available and integrated into the Solution within 30 days following the Effective Date.  D3 agrees to use commercially reasonable efforts to work with OJO to ensure that the Iris 4000 and other CPEs reasonably requested by OJO are available and integrated into the Solution within 90 days of a written request by OJO to D3.

 

b.      Fulfillment .  As more particularly defined in the applicable Statement of Work, D3 may be responsible for arranging for shipping certain CPEs to Subscribers and inserting any user manuals, quick start guides and installation software provided by OJO.  Unless otherwise specified, all such shipments shall be of new non-returned, non-refurbished CPEs made by a shipping method to be agreed to by the Parties, and shall be invoiced to OJO in accordance with the amounts set forth in the Pricing Schedule.

6.      Pricing .

a.      D3 Service Charges to OJO .  D3’s charges to OJO for the Solution are set forth in the Pricing Schedule.  D3 shall provide OJO with (i) at least 90 days’ prior written notice of any proposed price increases to any One-time Activation Fees, Monthly Per Subscriber Fees or Professional Fees included on the Pricing Schedule, (ii) at least 7 days’ prior written notice of any proposed price increases for national and international usage rates included on the Pricing Schedule and (iii) at least 45 days’ prior written notice of any price increases to any other item included on the Pricing Schedule.  Notwithstanding the foregoing, (A) D3 shall not increase any One-time Activation Fees, Monthly Per Subscriber Fees or Professional Fees on the Pricing Schedule without the prior written consent of OJO, (B) if D3 provided OJO with at least 7 days’ prior written notice of any proposed price increases for national and international usage rates, D3 shall be permitted to increase national and international usage rates on the Pricing Schedule following such 7 day notice period to an amount equal to 120% multiplied by the direct costs incurred by D3 with respect to such national and international usage rates and (C) if D3 provided OJO with at least 45 days’ prior written notice of any proposed price increases for any fees on the Pricing Schedule, other than One-time Activation Fees, Monthly Per Subscriber Fees, Professional Fees, national and international usage rates, D3 shall be permitted to increase such other fees on the Pricing Schedule following such 45 day notice period to an amount equal to 120% multiplied by the direct costs incurred by D3 with respect to the service underlying such fee.

b.      OJO Service Charges to Retail Subscribers .  As may be set forth and as more particularly defined in the applicable Statement of Work,

(i) D3 may be required to bill Retail Subscribers on behalf of OJO for such Retail Subscriber’s service charges as follows:  (A) monthly subscription fees shall be billed and collected (through a merchant account established and maintained by OJO in connection with the Solution) for the 30 days following the billing date and (B) non-recurring charges shall be billed and collected (through a merchant account established and maintained by OJO in connection with the Solution) (whether by actual charges to the Retail Subscriber or by debit against the credit balance of the Retail Subscriber maintained by OJO or D3, as applicable) at the time of purchase by the Retail Subscriber;

(ii) D3 may be required to notify OJO, pursuant to the reports contemplated by this Agreement and provided in the Solution, of the amounts that D3 will be charging OJO per month for each Retail Subscriber’s account (which will include a deduction for the pro-rated amounts to reflect the number of days within such month in which a Retail Subscriber’s account was not active for the entire month);

 

(iii) within five (5) days of the end of a Retail Subscriber’s billing cycle, D3 shall make available to such Retail Subscriber a detailed summary of charges incurred by the Retail Subscriber for such billing cycle; and

(iv) D3 may be required to facilitate the payment of all fees owed to OJO by Retail Subscribers as reasonably requested by OJO, with the resulting amounts being processed through a merchant account established and maintained by OJO in connection with the Solution.

c.      OJO Service Charges to Wholesale Subscribers .  As more particularly defined in the applicable Statement of Work, within seven (7) days after the end of each month, D3 shall provide OJO any information agreed to by the Parties with respect to the usage of services by each Wholesale Subscriber during the prior calendar month.

d.      Invoices .

(i)  D3 will invoice OJO on a monthly basis in U.S. dollars for all amounts due hereunder.  All payments hereunder shall be paid in U.S. dollars.  OJO shall pay D3 those fees and expenses set forth on such invoice in full (subject to paragraph (d)(ii) below) via wire transfer directly to a bank account or accounts designated by D3 or in such other manner mutually agreed upon by the parties within forty five (45) days of the date of the receipt of the invoice (the “Due Date”).  Any payments not received by the Due Date (other than with respect to any disputed amounts set forth in a disputed invoiced contemplated by Section 6(d)(ii)) may (at D3’s sole discretion) bear interest at a rate of one and one half percent (1.5%) per month (or the pro-rata portion thereof) or the maximum rate permitted by Law, whichever is less, until paid in full.  OJO shall reimburse D3 for all reasonable out-of-pocket costs (including reasonable attorneys’ fees) incurred by D3 in collecting unpaid amounts from OJO after a Due Date. This provision will survive termination or expiration of this Agreement.

(ii)  Notwithstanding the foregoing, amounts equal to charges set forth on an invoice may be withheld by OJO if OJO provides D3 with written notice that an invoiced charge (whether or not previously paid) is the subject of a bona fide dispute (which such notice shall set forth the disputed charge and the reasons (in reasonable detail) why OJO disputes any such charge) within ninety (90) days of receipt of the invoice containing the disputed item; provided that, OJO shall remit the undisputed portion of the invoice pursuant to paragraph (d)(i) above; provided further that, OJO shall not be limited in disputing errors or inaccuracies in invoices that have been caused by D3’s negligence or willful misconduct.  D3, in its reasonable discretion, may request additional supporting documentation from OJO regarding such disputed invoice.  D3 and OJO will promptly address and attempt to resolve such dispute in good faith within thirty (30) days.

e.      Pricing Reviews .  D3 shall use commercially reasonable efforts to structure and provision the Services contemplated by the Solution so as to offer wholesale pricing generally equivalent to market standards.  At either Party’s request, each Party agrees to meet telephonically periodically with the other Party, but not more than once every three months, to review and compare D3’s pricing with market prices for services substantially similar to the Services contemplated by the Solution. The Parties shall negotiate any appropriate price reductions or increases in good faith.

 

7.      Branding .  Except as otherwise expressly set forth herein, the Solution will be identified solely by such brands, logos and other names as are designated in writing by OJO, as provided below.

a.      Designation by OJO .  OJO shall designate, pursuant to a written notice delivered to D3 by the date specified therefor in the applicable   Statement of Work, the manner in which it requests D3 to implement the brand name designated by OJO in connection with the Solution.  Such written notification shall specify in reasonable detail the placement, application and usage guidelines related to such branding designations (e.g., OJO shall specify the manner in which it requests its branding designations to be applied to the graphic user interface, telephony user interface, manuals and other documentation, technical support line, Subscriber invoices, applicable websites and other individual components of the Solution), and shall include, where practical, electronic versions of such brand designations.

b.      Implementation by D3 .  Upon receipt of such information as is reasonably necessary to implement OJO’s branding designations, D3 shall use its reasonable efforts using D3’s then-current style configurations to configure the Solution to satisfy OJO’s branding requirements provided in the written notification set forth in Section 7(a).  Any delay by OJO in the delivery of its branding designations to D3 shall result in a like extension of the date by which D3 is required to effect the implementation thereof, as set forth in the applicable Statement of Work.

8.      Technical Support .  D3 shall be responsible for all Tier 3 technical support for the Services contemplated by the Solution.  To facilitate such technical support, D3 shall maintain an on-line trouble ticket system from which Tier 2 support can refer non-critical support questions.  In addition, D3 shall maintain a toll-free number from which Tier 2 support can refer critical support questions.  D3 acknowledges and agrees that all costs incurred by D3 in providing technical support contemplated by this Agreement or any Statement of Work are included in the per subscriber charges contemplated by the Pricing Schedule and, therefore, D3 will not separately charge OJO or any Subscriber any amounts for technical support contemplated by this Agreement or any Statement of Work.  OJO shall have the right at any time, upon the delivery of thirty (30) days’ prior written notice, to assume responsibility for the provision of such technical support at its sole cost.

9.      D3 Operational Responsibilities .

a.      Operational Matters; Deliverables .  As more particularly defined in the applicable Statement of Work, (i) D3 will be responsible for configuring, implementing and hosting the Solution, and for creating certain related deliverables and (ii) D3 agrees to provide the following: the Order Sign-up Portal, Members Center Portal, provisioning, billing and collection, and any other services set forth in this Agreement or any Statement of Work.  In providing such services to OJO, D3 shall be solely responsible for procuring such support services and technology as it deems necessary or desirable in connection with its responsibilities under this Agreement and any Statement of Work.  As requested by OJO, D3 shall use its best efforts to promptly deliver (with automatic installation), to all applicable CPEs used by Subscribers, any new versions, updates, changes, enhancements or modifications to the Software contained on such CPE.

 

b.      Disaster Recovery .  As promptly as practicable following the Effective Date, D3 shall (to the extent it has not already done so) ensure that a remote, redundant facility with the capacity to provide disaster recovery in connection with the Solution has become operational in North America.

c.      Service Levels .  In connection with the Solution, D3 will provide the Service to OJO in accordance with the service levels and the terms and conditions set forth in the Service Level Agreement (“ SLA ”) attached as Appendix C to this Agreement and incorporated herein by reference.  If D3 fails to attain a specified service level, it shall issue OJO a service credit in connection therewith, as set forth in the SLA.  The Solution shall track all service levels set forth in the SLA.

10.    Legal & Regulatory Compliance .

a.      Compliance with Laws .

(i)    General .  Each Party shall comply with all applicable Laws in connection with the exercise of its rights and performance of its obligations under this Agreement and any Statement of Work.

(ii)   OJO’s Compliance Responsibilities .  OJO shall be responsible for complying with all applicable Laws related to its offering of the Solution to Subscribers under this Agreement and any Statement of Work, including but not limited to the procurement of permits or certificates and the Laws regarding E-911 emergency services and enhanced E-911 emergency services (“ E-911 services ”), provided that, D3 agrees that the Solution shall include all functionality required by Law to enable OJO to provide E-911 services to Subscribers required by Law.

(iii)  D3 Compliance Responsibilities .  D3 shall procure all permits or certificates and make all filings with or reports to any applicable Government Authorities necessary to perform D3’s obligations under this Agreement and any Statement of Work.  D3 shall provide (to the extent relating to D3’s network or within D3’s possession or control, and not otherwise capable of being independently produced by OJO without under expense or effort) to OJO as part of the Solution the necessary services and, as reasonably requested and specified by OJO, certifications, documentation, information, data, reporting or tools to enable OJO to comply with all applicable Laws related to its offering of the Solution to Subscribers under this Agreement and any Statement of Work, including

 

Following the Effective Date, D3 shall promptly provide to OJO the CALEA plan filed by D3 with the required U.S. Governmental Authority, and, as they are developed in the future, any revisions or updates to that plan.

b.      Processing of Personal Data .

(i)     Standard .  D3 shall process Personal Data only in accordance with applicable Law and solely under the direction and control of, and pursuant to the instructions of, OJO pursuant to this Agreement, any Statement of Work and any model contracts executed pursuant to Section 10(b)(v).

(ii)    Ownership and Control .   OJO retains all right, title, and interest in and to any Personal Data transferred to D3.  OJO grants D3 a limited, revocable and non-exclusive license to use Personal Data for those purposes necessary for D3 to perform its obligations under this Agreement or any Statement of Work and for no other purpose, and provided that D3 will have no right to create or maintain data which is a derivative of such data.

 

(iii)   D3 Requirements .  D3 agrees that at any and all times during which it is Processing Personal Data, or otherwise having access to such Personal Data, it will:

(iv)   D3 Reporting Obligations .  D3 shall immediately and without unreasonable delay inform OJO, in writing:

 

(v)    European Union Compliance .  D3 represents and warrants that (a) the Order Sign-up Portal for the Solution shall only permit Subscribers that provide a service address located in the United States of America to purchase the Services contemplated by the Solution and (b) no Processing of Personal Data by D3 will be subject to any data protection laws of the European Union.

(vi)   Risk Assessment . Upon OJO’s request, D3 will provide reasonable evidence that it has established and maintains Technical and Organizational Security Measures governing the Processing of Personal Data appropriate to the risks represented by the Processing and the nature of the data to be protected.  OJO shall have the right to request from D3, and D3 agrees to provide OJO with, reasonable copies of and information concerning D3’s information security protocols.

(vii)  Internal Controls .  Upon the reasonable request of OJO, with respect to each calendar year in which the Solution is provided to OJO, D3 shall provide, from time to time, all internal control and process documentation related to the Solution and, if any internal control and process documentation reasonably satisfactory to OJO is not available, D3 shall promptly create, at D3’s sole cost and expense, such documentation of the internal controls and processes related to the Solution.  D3 shall permit OJO and OJO’s auditors to rely on all of D3’s internal control and process documentation in evaluating, preparing and auditing OJO’s internal controls over financial reporting and OJO’s disclosure controls and procedures.  D3 agrees to use its commercially reasonable efforts to promptly correct any deficiencies or weaknesses identified by OJO in D3’s internal controls and processes.

c.      Data Security .  D3 represents and warrants that it has adequate controls necessary to protect the confidentiality, integrity, and availability of Confidential Information and Personal Data, including the following:

(i)    D3 represents and war