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1. Payment of Fees

1.1 Measuring Usage – Where applicable and indicated on the specific Service Schedules, Xplornet will measure usage of the Xplornet Services in accordance with Xplornet’s policies and practices in effect from time to time. Xplornet may, at its sole discretion, amend its policies relating to measuring usage on thirty (30) days’ advance written notice to Customer.

1.2 Flat Rated Fees – Xplornet provides flat rated pricing for services identified in the Schedule(s).

1.3 Invoices – Installation Fees will be invoiced upon installation. If the Customer has requested more than one installation, Xplornet will invoice the Customer as each installation is provided. Monthly Recurring Fees will be invoiced in advance and Usage Fees will be invoiced in arrears. For Xplornet Service provided under any Schedule the monthly fee(s) for flat rated Xplornet Services will be invoiced in full, one month in advance. The flat rated monthly fee(s) under the remaining Schedules will be billed in the current month. All dollar amounts on invoices shall be in Canadian currency. Xplornet will invoice all charges monthly and payment must be received by Xplornet within thirty (30) days after the date of the invoice. Interest charges of 1.25% per month (or 15% annually) will be applied to all charges not paid within thirty (30) days of invoicing.

1.4 Other Charges – Customer will pay all sales and value-added taxes, duties or levies imposed by any authority, government, government agency or commission or crown corporation in connection with the Xplornet Services and the Equipment provided under this Agreement.

2. Customer Obligations

2.1 Site Accommodation – Customer will at its expense provide all necessary electrical and other utility connections and services, air conditioning equipment and other preparations and alterations to the Site(s) reasonably required by Xplornet to install and maintain the Equipment.

2.2 Operating Conditions – Customer will ensure that the operating and environmental conditions for the Equipment are suitable for equipment of this kind and otherwise conform to any reasonable requirements Xplornet might stipulate from time to time. If the operating and environmental conditions for the Equipment do not conform to Xplornet’s reasonable requirements, Xplornet may refuse to proceed with the installation of the Equipment, or if installed, remove the Equipment.

2.3 Co-operation and Access – Customer will permit Xplornet and its employees, designates or authorised agents to enter Customer’s premises during normal business hours, subject to Customer’s reasonable security measures, for the purpose of installing, inspecting, maintaining, relocating and removing the Equipment and for the purpose of performing any other act contemplated by this Agreement. Customer shall ensure that its clients acknowledge that Xplornet, may exercise similar rights on the premises of the Customer’s clients.

2.4 Xplornet Sites – If the Equipment is located on property of Xplornet (“Xplornet Site“) and Xplornet agrees to provide Customer access to or usage of the Xplornet Site, Customer shall enter into a Site Services Agreement with Xplornet concurrently with this Agreement becoming effective.

2.5 Prohibitions – Except with Xplornet’s express written consent, Customer or the Customer’s clients shall not:

a) alter, tamper, adjust or repair the Equipment, remove the Equipment from the Site(s); or

b) alter or allow to be altered, the environmental or operating conditions for the Equipment as specified by Xplornet.

2.6 Illicit Use – Under no circumstances shall the Customer use, and the Customer shall use commercially reasonable efforts to ensure that its clients do not use, the Xplornet Services or the Equipment fraudulently or otherwise illegally including, without limitation:

a) falsely reducing or avoiding in whole or in part, the regular charges for the Xplornet Services and the Equipment;

b) obtaining, accessing, altering or destroying data files, programs, procedures or other information of Xplornet or other customers of Xplornet;

c) using the Xplornet Services or the Equipment in such a manner as to interfere with the use of the Xplornet Services or the Equipment by other customers of Xplornet; and

d) using the Xplornet Services and the Equipment in any manner that, directly or indirectly, violates any law, rule, code or regulation or aids any unlawful act or undertaking.

2.7 Acceptable Use – Customer has read and agrees with Xplornet’s Acceptable Use Policy located on the Xplornet Web site (Internet Use Policy). The Policy may be modified periodically by Xplornet; all modifications are posted on the Xplornet Web site. Customer understands the Acceptable Use Policy is extended to Customers clients and will use commercially reasonable efforts to ensure its clients comply with the terms and conditions set out in the Acceptable Use Policy in an Acceptable Use Policy with its own clients. Continued use of Service is deemed to be the Customers acceptance of the modified Policy.

2.8 Liability – If any of Customer’s obligations under this Agreement, or those of Customers’ clients, are breached, Customer shall be liable to Xplornet for all costs (including legal fees) incurred by Xplornet in remedying the breach. In the event that the Customer’s client breaches any of the provisions of this Agreement, the Customer shall take commercially reasonable steps to remedy the breach and to prevent continuing breaches which may include issuing such notices to cure the default as are legally required and termination of the client’s entitlement to utilise the Xplornet Services and immediate removal of the Equipment.

2.9 Client co-operation – Customer shall use commercially reasonable efforts ensure that its clients will comply, at all times, with the terms of this Agreement to the extent that the Customer’s client makes use of the Xplornet Services or Equipment.

2.10 Security – Protection, security, and management of usage and security of the Customers Network, defined as the demarcation point at the Xplornet POP, is the sole responsibility of the Customer. In the event that the Customers Network security is violated the offence will be remedied between the Customer and the offending party(s). Xplornet will not compensate Customer for damages incurred due to security violation(s) of Customer Equipment/ Network(s), nor will the Customer make deductions or off sets of any kind for usage charges due Xplornet.

3. Xplornet Obligations

3.1 Installation – As soon as reasonably possible following the installation of suitable facilities, either by Xplornet or Customer, Xplornet will install the Equipment at the Site(s). Xplornet’s regular business hours are from Monday- Friday 8 a.m. – 5p.m. local time. Any installations to be scheduled outside of Xplornet’s regular business hours may be subject to after hour installation charges. Xplornet does not guarantee the availability of technicians to accommodate any after hour installations.

3.2 Xplornet Services – Xplornet shall provide the Xplornet Services in accordance with the terms and conditions of this Agreement.

3.3 Support – If required or requested, Xplornet will provide to Customer and its authorised users of the Xplornet Services, such training, instructional material and other support as Xplornet deems appropriate on Xplornet’s then current terms and prices for such support services.

3.4 Maintenance – Unless otherwise specified in the Schedule(s), Xplornet will maintain and repair the Equipment. It is the responsibility of the Customer to verify that their network and equipment, including power are in suitable operating and environmental working conditions. If a disruption of Service is reported to Xplornet that is a result of Customer equipment failure, any costs associated in remedying the disruption will be billed to the Customer, at Xplornet’s discretion, at current labour rates and material costs.

3.5 Service Commitment – Xplornet shall maintain a minimum network availability of 99% for each Customer circuit (based on 24 hours per day, 365 days per year), averaged over the preceding 12 month period of actual operation, determined using Xplornet’s network data. If Xplornet has not provided this level of network availability, the Customer may give written notice to Xplornet requesting that Xplornet restore network availability to 99%. Xplornet shall have 60 days from the date of such notice to restore network availability to 99% (calculated for the 60 day period following the notice date) or otherwise to resolve the matter to the Customer’s satisfaction. If Xplornet is unable to do so within 60 days, the Customer may, within 30 days following the 60 day period, terminate this Agreement without further liability therefore, except as may be incurred by the Customer prior to such termination, by giving Xplornet written notice of termination. Termination of this Agreement and all of the obligations of the Customer under it shall be effective as of the date of actual receipt of the notice of termination by Xplornet. If the Customer does not give a notice of termination within the following 30 days, Xplornet shall be deemed to have resolved the matter to the Customer’s satisfaction, and the right of the Customer to terminate this Agreement for inadequate network availability shall thereupon expire. Xplornet shall not otherwise have any liability or duty whatsoever to the Customer respecting network availability and the Customer shall be fully liable to Xplornet for all of its obligations under this agreement unless and until terminated in accordance with these terms.

3.6 Temporary Suspension – The Customer agrees that it may be necessary for Xplornet to temporarily suspend the Xplornet Services for technical reasons or to maintain the Xplornet network, the Equipment or any other facilities (including, without limitation, as described in Section 3.7 below). Xplornet will provide two (2) business days advance notice to the Customer regarding any scheduled maintenance. Such suspension of Xplornet services will not be an “interruption” of the Xplornet Services for the purpose of calculating network availability or the Customer’s entitlement to credit for interruption of the Xplornet Services, unless such interruption exceeds four (4) hours in length. If such interruption exceeds four (4) hours, the two (2) hour period applicable for determining a Customer’s entitlement to a credit allowance shall commence following the completion of the four (4) hour period. Xplornet may interrupt the Xplornet Services at any time for any duration of time, without penalty or liability for any claim by Customer, where necessary to prevent improper or unlawful use of the Xplornet Services, Xplornet’s service facilities or connections or Xplornet’s network.

3.7 Access to Customer Premises – For the purpose of restoring the Xplornet Services in the event of an interruption, the Customer acknowledges that Xplornet may require access to the Customer’s premises in addition to access required under section 2.3 of these General Terms and Conditions. The Customer agrees to provide such access immediately upon Xplornet’s request at no charge to Xplornet. Xplornet may, upon reasonable notice to the Customer (determined in the circumstances, but not exceeding 48 hours), make such inspections, tests and adjustments as it may deem necessary to investigate, modify or maintain the installation or operation of the Customer’s or Xplornet’s network and equipment, the Equipment or connecting facilities. Upon such reasonable notice, the Customer shall make available to Xplornet such facilities, equipment and the Equipment (including by providing access to the Customer’s premises) as may be reasonably necessary in the circumstances. The Customer acknowledges that failure to do so may prevent Xplornet from maintaining the network, equipment facilities and Equipment in satisfactory condition and agrees that if the Customer fails to provide such access or access required under section 2.3 of these General Terms and Conditions, the Customer will have no remedy or entitlement to credit for any failure of Xplornet to meet its obligations under this Agreement.

4. Proprietary Rights

4.1 Equipment – Customer acknowledges and agrees that title to the Equipment and all other material provided to Customer by Xplornet under this Agreement shall at all times remain with Xplornet and Customer shall acquire no property or other rights in or to any of the foregoing other than as specifically provided in this Agreement during the term or any subsequent renewal period.

4.2 Software – Where any of the Xplornet Services or the Equipment contains computer programming or software (the “Resident Software“), Xplornet hereby grants to Customer and the Customer’s clients a non-exclusive, non-transferable royalty-free licence to use during the term of this Agreement the Resident Software for the sole purpose of enabling Customer and the Customer’s client to obtain the Xplornet Services. Customer recognise that the Resident Software constitutes valuable trade secrets of Xplornet and its licensors and that Xplornet and its licensors own all of the technology, know-how and intellectual property rights associated with such software, the Xplornet Services and the Equipment. Customer shall use its best efforts to protect and keep confidential the Resident Software used by it and shall make no attempt to examine, copy, alter, reverse engineer, tamper with or otherwise misuse the Resident Software.

4.3 Trade Marks and Trade Names – The Customer shall not display or otherwise use any trade mark, trade name, logo, symbols, coined word or combination of words used by Xplornet or permit the same to be displayed or otherwise used in connection with any business conducted or controlled by the Customer except as may be specified or approved by Xplornet in writing.

4.4 Confidentiality – It is recognized that technical, financial, commercial, legal or other information (collectively the “Confidential Information”) may be disclosed by one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”) whether disclosed orally or in any other media form and howsoever obtained may be exchanged between Parties during the course of this Agreement. The Receiving Party shall not disclose the Confidential Information to any third party without the prior express written consent of the Disclosing Party, unless compelled by law or order of a court or regulatory body having jurisdiction. Any Confidential Information disclosed shall remain the property of the Disclosing Party. Notwithstanding the foregoing, where Xplornet is the Receiving Party, it may use Confidential Information received from the Customer for the purposes of providing the Xplornet Services to the Customer and may use or disclose such Information in any manner otherwise permitted or authorized by any applicable municipal, provincial or federal law.

5. Termination

5.1 By Xplornet – If Customer breaches any of its obligations under this Agreement or any Schedule to this Agreement and fails to correct the breach within ten (10) calendar days after receiving written notice from Xplornet to do so, except for failure to pay any amount due under this Agreement in which case the Customer shall have three (3) calendar days to correct the breach (ii) persistently breaches any of the terms or conditions of this Agreement or any Schedule to this Agreement, or (iii) should become insolvent or subjected to any process, proceeding or arrangement for the benefit of its creditors, including any reorganisation, receivership or liquidation proceedings, then Xplornet may terminate this Agreement by giving Customer written notice of termination, which termination will take effect when notice is given. Xplornet may terminate this Agreement for any reason upon 30 days prior written notice.

5.2 By Customer – If Xplornet amends any of the Schedule(s) to the Agreement and the effect of the amendment, or the cumulative effect of an amendment with past amendments, amounts to a material change of the Xplornet Services offered or the cost of the Xplornet Services, then the Customer shall have the right within thirty (30) days of the amendment, to terminate this Agreement without penalty by giving Xplornet thirty (30) days advance written notice of termination which termination will take effect upon the expiry of the thirty (30) day notice period. For Customers subscribing to Xplornet services in Alberta who terminate this Schedule or this Agreement prior to the expiry of the contracted service term or if Xplornet terminates this Agreement pursuant to paragraph VI of the Master Agreement, Customer will be liable to pay to Xplornet, in addition to all charges owing, an amount equal to 50% of the Monthly Recurring Charge (“MRC”) for each of the months remaining in the Initial Term. In addition to this amount payable to Xplornet, the Customer understands and agrees to pay to Xplornet the additional fees for recovery of construction costs based on the difference between actual costs incurred less installation costs paid by Customer and calculated as follows:

Termination less than 12 months = 100% of cost

Termination between 13 and 24 months = 75% of cost

Termination between 25 and 36 months = 50% of cost

In the event that Xplornet’s amendment should result in the termination of services by Customer as provided for in this Section 5.5, Xplornet agrees to cooperate fully with Customer and any new service providers to ensure a seamless transition between Xplornet and the new service providers with minimum disruption upon termination of this Agreement. In particular, Xplornet agrees to provide termination assistance services to Customer that are similar to services which Xplornet provides to other customers in similar circumstances upon request by Customer, and at the best rate that Xplornet charges to any of its other customers.

6. Return of Materials

Upon the expiration or earlier termination of this Agreement, Customer shall cease all use of the Resident Software and Equipment and Customer will permit Xplornet, using lawful means, to remove from Customer’s premises the Equipment and all material in whatever form or whatever medium that contains or discloses any information relating to the Xplornet Services and the Equipment. Where the Site(s) is on the premises of a client of the Customer, Customer shall ensure that Xplornet may exercise similar rights to enter and remove the Equipment and all material in whatever form or whatever medium that contain or disclose any information relating to the Xplornet Services and the Equipment. Customer will provide to Xplornet a letter confirming that all such materials have been returned to Xplornet.

7. Early Termination

If prior to the expiry of the Term(s), Customer fails to fulfil its obligations under this Agreement, leading to the termination of this Agreement by Xplornet, Customer agrees that it shall be liable to pay to Xplornet an amount equal to the total of the Monthly Base Fees for the period remaining in the term(s), unless otherwise stated in the Service Schedule(s). For Xplornet Services ordered not yet implemented Customer will be responsible for any charges associated with the process of provisioning the Services. Customer acknowledges and agrees that the foregoing amounts payable are the reasonable liquidated damages of Xplornet recoverable from Customer for early termination and not a penalty fee.

8. Limited Warranty

Subject to the terms and conditions of this Agreement, Xplornet warrants that where the Equipment is used for the purposes for which it was designed, constructed and installed and, in accordance with user manuals for the Equipment, Customer’s purposes as stated in the Schedule(s) and Xplornet’s instructions provided to Customer from time to time that it will conform to Xplornet’s specifications for such Equipment provided however that this limited warranty will not apply to any error or interruption caused by any event, circumstance or development which is outside of the reasonable control of Xplornet or as a result of scheduled operational or maintenance down time for which Xplornet has provided Customer advance notice.

Xplornet’s sole obligation, and Customer’s sole remedy shall be for Xplornet subject to sections 3.6 and 3.7 to make such commercially reasonable adjustments, repairs and replacements as are necessary to maintain the Equipment in working order or, in Xplornet’s sole discretion, it will not charge fees for use in respect of such portion of the Xplornet Services which failed to meet this limited warranty.

8.2 The warranties in section 8.1 are in lieu of all other representations, warranties and conditions, express or implied but not limited to any implied warranties, representations or conditions of merchantability, fitness for a particular purpose or non-infringement of third party rights, with respect to the equipment and the Xplornet services or regarding the date upon which the equipment or Xplornet services are to be installed or will become operational.

9. Limitation of Liability

Customer acknowledges and agrees neither Xplornet nor any of its members, shareholders, directors, officers, employees or representatives will be liable for any special, indirect, consequential, incidental, punitive or exemplary damages, or damages (including but not limited to damages for loss of profits or savings, loss of data, or loss of use) in connection with this agreement, the Xplornet services or the equipment or any other information, material or services provided by Xplornet to customer under or related to this agreement, whether arising out of contract, tort or other basis. if despite the foregoing limitations, Xplornet or any of its shareholders, directors, officers, employees or representatives should become liable to customer or any other person in connection with this agreement for any reason, then the maximum aggregate liability of Xplornet, its members, shareholders, directors, officers, employees and representatives for all such things and to all such parties will be limited to the lesser of the actual amount of loss or damage suffered by the claimant or the amount payable by customer to Xplornet for the one month period of service under this agreement immediately prior to the event giving rise to the claim of the claimant.

10. Indemnity

10.1 Customer will indemnify and save harmless Xplornet and its members, shareholders, directors, officers, employees, agents, contractors, and representatives from and against all damages, losses, costs and expenses (including actual legal fees and costs), fines and liabilities incurred by or awarded, asserted or claimed against Xplornet or any of its members, shareholders, directors, officers, employees and representatives in connection with Customer’s negligence, activities or omissions, or breaches of its obligations under this Agreement.

10.2 Xplornet shall indemnify Customer against and hold Customer harmless from any and all claims, actions, suits, proceedings, losses, costs, expenses, damages and liabilities arising pursuant to this Agreement due to any infringement or alleged infringements of any patent, copyright, trademark, trade secret or other intellectual property right by Xplornet.

11. Insurance

Customer will obtain and maintain throughout the term of this Agreement all risks liability and property damage insurance on terms and in amounts for the replacement cost of the Equipment and, for bodily harm to employees or contractors of Xplornet working on Customer’s premises and Worker’s Compensation coverage in an amount not less than that prescribed by statutory limits For Customer’s subscribing to Co-Location Services the customer shall, at its sole cost and expense, procure, maintain, pay for and keep in force insurance coverage as specified below:

a) Commercial general liability coverage on an occurrence basis in an amount of not less than $1 million combined single limit for bodily injury and property damage. Said coverage shall include contractual, owners and contractors protective, products/completed operations, occurrence property damage. Said coverage shall include contractual, owners and contractors protective, products/ completed operations, occurrence property damage, personal injury and contingent employer’s liability endorsements.

b) All Risk Property coverage on a full replacement cost basis insuring all of the Customer’s real and personal property situated on or within the Customer’s licensed location(s).

c) All insurance and certificates must be in effect and submitted to Xplornet prior to Customer equipment being present on the Xplornet premises and shall remain in force as long as the Customer’s equipment remains within any spaces governed by this Master Agreement.

d) All such insurance policies shall name Xplornet as an additional insured; contain a cross liability clause and severability of interests’ clause.

e) In respect for Customer’s equipment located upon Xplornet premises, Customer must conform to all recommendations made by Xplornet’s insurers and fire and safety consultants in existence as of the date of the commencement date of the location of Customer equipment upon Xplornet premises and such recommendations as may be made from time to time during the term of this Agreement.

f) All policies of insurance to be obtained by the customer shall contain an undertaking by the Customer’s insurer to Xplornet that they will provide Xplornet with thirty (30) days prior notice of any material change to or cancellation of Customer’s insurance coverage required to be maintained by this Agreement.

12. Force Majeure

12.1 Each party shall be relieved from the performance of its obligations under this Agreement if, and for so long as, it is unable to perform such obligations due to circumstances beyond its reasonable control, including, but not limited to, power surges or failures, acts of God, acts or omissions of any common carrier, labour disputes, changes in law or regulation, or other acts of governmental authority.

12.2 Notwithstanding anything contained in these General Terms and Conditions of Services or this Agreement, in no event will either Xplornet, any supplier of services to Xplornet or any landlord or licensor of Xplornet where Xplornet equipment or facilities are located, be liable in any manner or upon any basis to Customer for any loss or damages, whether direct or indirect, incidental, special or consequential, resulting from an interruption in the Services provided by Xplornet to the Customer, caused by or attributable to directly or indirectly, fire or other perils or factors beyond the reasonable control of Xplornet and any of its suppliers, landlords or licensors. For the purposes of this Section 12.2, perils or factors beyond the control of Xplornet or its suppliers, landlords, or licensors include those factors set forth in Section 12.1 herein.

13. Notices

All notices must be in writing and delivered personally or by facsimile transmission to the address or fax number specified for each party on page 1 of this Agreement. Addresses and facsimile numbers for notices may be changed by subsequent notice. Notices delivered personally are given when received. Notices delivered by facsimile transmission are given at the location of receipt on the business day immediately following the date of transmission.

14. Assignment

Customer may not assign this Agreement without the express written consent of Xplornet. Xplornet may assign this Agreement without the consent of Customer, provided notice of such assignment is provided to Customer at any time prior to or within 60 days after such assignment.

15. Amendments and Modifications

From time to time, Xplornet may amend the contents of this Agreement, including these Terms and Conditions, and the Schedule(s) by providing not less forty-five (45) days prior notice to Customer of such changes. Notice may be provided by posting updates on Xplornet’s website. Except as otherwise provided in this Section 15, no amendment or other modification to this Agreement will be effective unless in writing and signed by each of the parties to this Agreement. If Xplornet determines at anytime that there has been any alteration, deletion or other change of any kind made to this Agreement, that Xplornet has not expressly agreed to in writing, this Agreement may in Xplornet’s complete discretion, be immediately terminated and upon such termination will no longer be of any force and effect excepting any obligations accrued and outstanding prior to such termination and those which are by their nature are intended by the parties to survive such termination, including without limitation, any obligation in the Agreement of the Customer to pay early termination charges.

16. Governing Law

This Agreement shall be interpreted in accordance with and be governed in all respects by the laws of Canada applicable therein. The parties attorn to the jurisdiction of the Courts of Canada.

17. Customer Acknowledgement

Customer acknowledges that it accepts all risk of any unauthorised or illegal use of the Xplornet Network or any inter-connected network by third parties. Xplornet will use reasonable commercial efforts to assure a reasonable level of security for its network, however it provides no warranties, makes no representations, and accepts no liability for the unauthorised or illegal access or interference with the Customer’s network unless such access or interference is caused by the intentional unlawful acts of Xplornet, its agents or employees.

18. Survival

Notwithstanding termination of this Agreement, the parties remain bound by sections 2.8, 4.1, 4.2, 4.3, 4.4, 6, 8, 9, 10 and other provisions of this Agreement that are necessary for the interpretation or enforcement thereof.