<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1996
or
[_] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from____________ to ______________
Commission File Number 1-14322
EXCEL COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-2624939
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
8750 North Central Expressway, Dallas, Texas Suite 2000 75231
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (214) 863-8000
9101 LBJ Freeway, Dallas, Texas Suite 800 75243
(Former address of principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes No X
(Company has been public for less than 90 days)
As of August 6, 1996, the registrant had outstanding 108,800,000 shares of $.001
par value common stock.
<PAGE>
EXCEL COMMUNICATIONS, INC.
FORM 10-Q
For the Quarter Ended June 30, 1996
INDEX
Page No.
--------
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets 1 - 2
Consolidated Statements of 3
Operations
Consolidated Statements of Cash 4
Flows
Notes to Consolidated Financial 5 - 9
Statements
Item 2. Management's
Discussion and Analysis of Financial Condition and
Results of Operations 10 - 14
PART II: OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 2. Changes in Securities 15
Item 3. Defaults upon Senior Securities 15
Item 4. Submission of Matter to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports 15
on Form 8-K
Signature 16
Exhibit Index 17
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
---- ----
(unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents............ $150,420 $ 30,387
Accounts receivable, net............. 175,985 90,427
Inventories.......................... 3,784 2,862
Deferred income tax asset............ 4,644 2,100
Other current assets................. 3,498 566
-------- --------
338,331 126,342
-------- --------
Property and equipment, net............... 48,237 8,560
-------- --------
Deferred subscriber acquisition costs..... 108,969 68,366
-------- --------
Other assets.............................. 773 313
-------- --------
$496,310 $203,581
======== ========
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
1
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
---- ----
(unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Accounts payable................................................... $114,288 $ 65,116
Commissions payable................................................ 27,836 20,886
Accrued liabilities................................................ 31,889 13,822
Income taxes payable............................................... - 4,974
Current maturities of long-term debt and capital lease obligations. 358 473
Dividends payable.................................................. - 20,000
-------- --------
174,371 125,271
-------- --------
Long-term debt and capital lease obligations.......................... 274 345
-------- --------
Deferred management services fees..................................... 33,484 21,291
-------- --------
Deferred income taxes payable......................................... 40,648 18,966
-------- --------
Commitments and contingencies......................................... - -
-------- --------
Stockholders' equity:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none
outstanding .................................................... - -
Common stock, $0.001 par value, 500,000,000 shares authorized,
108,800,000 and 99,000,000 issued and outstanding............... 109 99
Additional paid-in capital......................................... 138,232 1,902
Unearned Compensation.............................................. (1,079) (2,158)
Retained earnings.................................................. 110,271 37,865
-------- --------
Total stockholders' equity................................ 247,533 37,708
-------- --------
$496,310 $203,581
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
2
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
------------------ ----------------
June 30, June 30,
---------- ----------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Communication services............... $271,926 $67,302 $477,200 $118,317
Marketing services................... 73,439 30,417 148,955 48,141
-------- ------- -------- --------
Total revenues............. 345,365 97,719 626,155 166,458
-------- ------- -------- --------
Operating expenses:
Communication........................ 151,421 40,087 264,935 69,453
Marketing services................... 93,819 29,789 170,759 51,054
General and administrative........... 43,483 14,453 80,424 23,763
-------- ------- -------- --------
Total operating expenses... 288,723 84,329 516,118 144,270
-------- ------- -------- --------
Operating income........... 56,642 13,390 110,037 22,188
-------- ------- -------- --------
Income (losses) from joint venture... 3,124 (647) 4,165 (992)
Other income......................... 1,480 (101) 1,931 (234)
-------- ------- -------- --------
Income before income taxes.............. 61,246 12,642 116,133 20,962
-------- ------- -------- --------
Provision for income taxes........... 22,826 4,767 43,727 7,903
-------- ------- -------- --------
Net income.............................. $ 38,420 $ 7,875 $ 72,406 $ 13,059
======== ======= ======== ========
Net income per share.................... $ 0.36 $ 0.08 $ 0.70 $ 0.14
======== ======= ======== ========
Weighted average shares and share
equivalents outstanding................ 106,562 96,720 103,423 96,480
======== ======= ======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
3
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
--------
1996 1995
---- ----
Operating activities:
<S> <C> <C>
Net income........................... $ 72,406 $ 13,059
Adjustments to reconcile net income
to net cash provided by operating
activities
Depreciation and amortization...... 1,786 436
Employee stock plan compensation... 3,048 2,791
(Income) losses from joint venture. - 990
Deferred income taxes.............. 19,138 (251)
Changes in assets and liabilities:
Accounts receivable, net........ (85,558) (17,751)
Deferred subscriber acquisition
costs........................... (40,603) (15,056)
Accounts payable................ 49,172 12,450
Commissions payable............. 6,950 7,490
Deferred management services
fees............................ 12,193 5,105
Accrued liabilities............. 18,067 586
Income taxes payable............ (4,974) 27
Inventories and other........... (4,314) (315)
----------- --------
Net cash provided by operating
activities....................... 47,311 9,561
----------- --------
Investing activities:
Purchase of property and equipment... (41,463) (2,384)
Investment in joint venture.......... - (2,818)
Advances on note receivable.......... - (5,280)
----------- --------
Net cash used in investing
activities....................... (41,463) (10,482)
----------- --------
Financing activities:
Payments of debt and capital lease
obligations....................... (186) (200)
Payments of dividends................ (20,000) (3,000)
Net proceeds from issuance of common
stock............................. 134,371 -
----------- --------
Net cash provided by (used in)
financing activities........... 114,185 (3,200)
----------- --------
Net increase (decrease) in cash......... 120,033 (4,121)
Cash, beginning of period............ 30,387 8,821
----------- --------
Cash, end of period.................. $ 150,420 $ 4,700
=========== ========
Supplemental disclosure:
Interest paid during the period...... $ 118 $ 188
Income taxes paid during the period.. 31,404 8,701
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
4
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except share data)
The Consolidated Financial Statements include the accounts of EXCEL
Communications, Inc., and its wholly-owned subsidiaries (collectively referred
to as the "Company" or "EXCEL"). All significant intercompany accounts and
transactions have been eliminated.
These Consolidated Financial Statements have been prepared without audit,
pursuant to the rules and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations. These
Consolidated Financial Statements should be read in conjunction with the notes
to the financial statements in the Company's Registration Statement on Form S-1,
as filed with the Securities and Exchange Commission in February 1996, as
amended.
The financial information included herein reflects all adjustments (consisting
only of normal recurring adjustments) which are, in the opinion of management,
necessary for a fair presentation of the results for interim periods. The
results of operations for the three and six month periods ended June 30, 1996
are not necessarily indicative of the results to be expected for the full year.
1. Initial Public Offering
In May 1996, a total of 11,500,000 shares of the Company's common stock were
sold in an initial public offering ("IPO") at $15 per share. Stockholders sold
1,700,000 shares, and 9,800,000 shares were sold by the Company which resulted
in net proceeds of approximately $134.4 million to the Company after deducting
the expenses of the offering.
2. Marketing Activities
Marketing services revenues are primarily comprised of receipts from
Independent Representatives ("IRs") and the Area Coordinators which train IRs
("ACs"). Except in certain states, IRs are required to make an initial one-time
refundable application deposit with EXCEL as an expression of commitment. There
is no additional cost to participate. IRs have an option to purchase a start-up
package, which includes training, business forms, promotional and presentation
materials, ongoing technical and administrative support services and monthly
reports. If the start-up package is purchased, the application deposit
requirement is waived. In addition, EXCEL offers training positions whereby ACs,
certified by the Company, provide training to new IRs. The portions of the
marketing services revenues received that relate to ongoing technical and
administrative support services are deferred in accordance with generally
accepted accounting principles, and amortized over a period of 12 months in
order to match those revenues with the costs of providing the related support
services. Marketing services revenues, as reflected in the Company's
Consolidated Statements of Operations include the effect of the deferral of a
portion of the cash received for management services during a period, as well as
the effect of the current period amortization of amounts deferred in prior
periods. The net effect of deferring and amortizing a portion of management
services fees was a reduction in revenues reflected in the Company's
Consolidated Financial Statements of $3.9 million and $3.8 million for the three
months ended June 30, 1996 and 1995, respectively, and $12.2 million and $5.1
million for the six months ended June 30, 1996 and 1995, respectively. These
deferred revenues are reflected as deferred management services fees in the
Consolidated Balance Sheets.
5
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except share data)
Marketing services costs include commissions and the costs of providing
training, business forms, promotional and presentation materials, technical and
administrative support services, and monthly reports. When the Company's
marketing services costs are offset by its marketing services revenues, the net
expense represents the Company's net cost of marketing its communication
products. Commissions are paid to IRs based upon the acquisition of new long
distance subscribers and for long distance telephone usage by subscribers. The
Company also pays commissions for the training of IRs and ACs. The portions of
commissions paid that directly relate to the acquisition of long distance
subscribers are capitalized in accordance with generally accepted accounting
principles and amortized over a period of 12 months in order to better match
those costs with the revenue stream from subscribers' long distance usage during
the first 12 months of service to such subscribers. Marketing services costs,
as reflected in the Company's Consolidated Statements of Operations, include the
effect of the capitalization of the portion of commissions paid for the
acquisition of new subscribers during a period, as well as the effect of the
current period amortization of amounts capitalized in prior periods. The net
effect of capitalizing and amortizing a portion of commissions expense was a
reduction in marketing services costs reflected in the Company's Consolidated
Financial Statements of $13.0 million and $12.6 million, for the three months
ended June 30, 1996 and 1995, respectively, and $40.6 million and $15.1 million
for the six months ended June 30, 1996 and 1995, respectively. These deferred
costs are reflected as deferred subscriber acquisition costs in the Consolidated
Balance Sheets in the Company's Consolidated Financial Statements.
3. Net Income Per Share
Net income per share is based on the weighted average number of shares of
common stock outstanding. These weighted average shares outstanding exclude
employee stock ownership plan shares that have not been released to employees.
The weighted average shares outstanding include common share equivalents which
represent the effect, using the treasury stock method, of options granted under
the Company's stock option plan.
4. Income Taxes
The components of the provision for income taxes are as follows for the
six months ended June 30, 1996 and 1995:
<TABLE>
<CAPTION>
Six Months Ended June 30,
-------------------------
<S> <C> <C>
1996 1995
---- ----
Current............................... $24,589 $7,652
Deferred.............................. 19,138 251
------- ------
Provision for income taxes.......... $43,727 $7,903
======= ======
</TABLE>
6
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except share data)
The provision for income taxes was different than the amount computed using the
statutory income tax rate for the reasons set forth in the following table:
<TABLE>
<CAPTION>
Six Months Ended June 30,
------------------------
1996 1995
---- ----
<S> <C> <C>
Tax computed at statutory rate... $40,647 $7,337
State income taxes and other..... 3,080 566
------- ------
Provision for income taxes.... $43,727 $7,903
======= ======
</TABLE>
5. Supplier Agreements
The Company has historically purchased substantially all of its switching
and transmission facilities from one supplier, Frontier Communications
Services, Inc. ("Frontier"). Pursuant to an agreement entered into in January
1996, the Company began transferring certain of its long distance traffic
(currently representing approximately 22% of the Company's long distance
traffic) to IXC Long Distance, Inc. ("IXC"). In June 1996, the Company and
Frontier restructured their agreement to enable the Company to utilize
additional carriers to, among other things, accommodate its growth and further
ease its reliance on Frontier. Effective May 31, 1996, the Company entered into
a non-exclusive agreement with WorldCom Network Services, Inc. ("WorldCom") to
provide network switching services and dedicated access services to EXCEL's
subscribers. Under the new contract, EXCEL will begin the migration of
subscriber traffic to WorldCom's long distance network during the third quarter
of 1996. The contract also calls for a $900 million cumulative commitment over
four years. In June 1996, the Company entered into a non-exclusive agreement
with MCI Telecommunications, Corp. ("MCI") to provide network switching services
and dedicated access services to EXCEL's subscribers. Under the new contract,
EXCEL will also begin migrating existing subscriber traffic to MCI's long
distance network during the third quarter of 1996. The contract calls for a $5
million per month minimum commitment over the next two years. Upon completion of
the transition of long distance traffic to these new carriers, all 1-plus long
distance traffic will be moved from Frontier. EXCEL has agreed to leave certain
calling card and personal 800 traffic (representing approximately 7% of EXCEL's
current long distance minutes) with Frontier through April 30,1999.
6. Stockholders' Equity
Effective January 1, 1996, the Company issued 99,000,000 shares of its common
stock to stockholders at a conversion rate of 1,000 shares of newly issued
common stock for each share of common stock previously held. These new shares
were issued pursuant to a reorganization, which included a statutory merger
whereby the Company was formed as a holding company. In addition, 500,000,000
shares of common stock were authorized. All common stock and per share amounts
in the Company's Consolidated Financial Statements have been adjusted
retroactively to give effect to the stock conversion and the change in
authorized shares. In May 1996, the Company sold 9,800,000 shares of its common
stock at $15.00 per share, which resulted in 108,800,000 shares outstanding and
net proceeds of approximately $134.4 million to the Company after deducting the
expenses of the offering.
Subsequent to the reorganization completed in January 1996, the Company has
10,000,000 shares of preferred stock authorized, which can be issued in one or
more series with fixed designations, relative powers, preferences, rights,
qualifications, limitations, and restrictions of all shares of each series,
including without limitation, dividend rates, preemptive rights, conversion
rights, voting rights,
7
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except share data)
redemption and sinking fund provisions, liquidation preferences, and the number
of shares constituting each such series, without any further vote or action by
the stockholders.
During the second quarter of 1996, the Company paid dividends of $20.0
million.
7. Commitments and Contingencies
Litigation, Claims and Assessments
On May 3, 1996, Linden Wood, Brad Campbell, Candy Campbell, Jerry Szeszulski,
and Team Excel of Independent Representatives ("Team Excel") filed suit in state
district court in Tulsa County, Oklahoma, jointly and severally, against the
Company, its indirect subsidiary, EXCEL Telecommunications, Inc. ("ETI"),
Stephen R. Smith, a director and the Executive Vice President of Marketing of
the Company, and Kenny A. Troutt, a director and the Chief Executive Officer,
President, and Chairman of the Board of the Company. Each of the individual
plaintiffs was an IR and each is alleged to be a member of Team Excel. Team
Excel is alleged to be an unincorporated association of IRs that was formed by
Mr. Wood and others as an independent association of IRs. Mr. Wood has been an
IR for several years and was one of the top ten highest earning representatives
during the first quarter of 1996.
The plaintiffs have asserted claims against the Company and the individual
defendants for defamation, unfair competition, and interference with contractual
relations. The plaintiffs allege that the defendants have threatened to
terminate the IR agreement with each of the plaintiffs and that the defendants
have maliciously: published an article containing false statements about each
plaintiff; engaged in actions that constitute unfair competition and trade
practices; and engaged in actions that constitute interference with the alleged
contractual relationships between each individual plaintiff and his or her
downline IRs. The plaintiffs collectively are seeking actual damages of
$105 million and punitive damages of $300 million. The plaintiffs are also
seeking attorneys' fees and costs, and such other relief as the court deems just
and appropriate.
On May 6, 1996, the Company and the other defendants removed this action to
the United States District Court for the Northern District of Oklahoma (the
"Oklahoma Litigation"). On May 23, 1996, the Company and the other defendants
filed with the American Arbitration Association ("AAA") in Dallas, Texas, a
demand for arbitration against each of the plaintiffs in the Oklahoma Litigation
pursuant to the terms and conditions of agreements with the plaintiffs. In this
arbitration proceeding, the Company, ETI, Messrs. Troutt and Smith are known
collectively as the "EXCEL plaintiffs". While the EXCEL plaintiffs have reserved
the right to amend their claims, the arbitration proceeding seeks a declaration
that the EXCEL plaintiffs have not committed any of the acts alleged to have
occurred in the Oklahoma Litigation. In addition, ETI has sought a declaration
that Mr. Wood, Mr. and Mrs. Campbell, and Mr. Szeszulski (the "arbitration
defendants") materially breached their agreements with ETI by filing the
Oklahoma Litigation, and ETI seeks to recover compensatory damages for that
breach. The Company and ETI have also asked for compensatory damages for Mr.
Wood's claimed disparagement of the Company and ETI, as well as Mr. Wood's
tortious interference with the Company and ETI's actual and prospective
contractual relations. The Company and ETI are seeking damages in excess of one
million dollars, reasonable attorneys fees and costs.
Also on May 23, 1996, the EXCEL plaintiffs filed a Petition to Compel
Arbitration against the same parties in the United States District Court for
Northern District of Texas, Dallas Division. The EXCEL plaintiffs have asked the
Court to issue an order compelling the arbitration defendants to arbitrate the
8
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except share data)
claims asserted by them in the Oklahoma Litigation pursuant to the Commercial
Arbitration Rules of the AAA, with arbitration to occur in Dallas, Texas.
On May 23, 1996, in the Oklahoma Litigation, the Company and the other
defendants filed a Motion to Stay the litigation in favor of the arbitration in
Dallas, Texas. In addition, the Company, Mr. Troutt and Mr. Smith asked the
Court to dismiss them from the lawsuit for lack of in personam jurisdiction. All
of the defendants have asked the court to dismiss or, in the alternative, to
grant summary judgment on, all of the claims made in the Oklahoma Litigation.
The Company denies the allegations, is vigorously defending the litigation,
and believes the ultimate outcome thereof will not have a material adverse
effect upon the Company's results of operations or financial position. The
Company believes that its actions with respect to the IRs, including the
plaintiffs, have been reasonable and in compliance with the Company's
contractual agreements with the IRs. However, an unfavorable outcome in this
matter could have a material adverse effect upon the Company's results of
operations or financial position. Even if the Company and other defendants
ultimately prevail, the defense effort could involve considerable cost
(including the costs of paying for the defense of Mr. Troutt and Mr. Smith
pursuant to their rights to indemnification) and a diversion of management
efforts. In the past, the Company has had IRs with significant downlines reduce
their efforts and in some cases quit the business completely, and such actions
have not had a material adverse impact upon the Company's results of operations
or financial position. As a result, the Company believes that these issues with
Mr. Wood and the other plaintiffs will not have a material adverse effect upon
the Company's results of operations or financial position. However, regardless
of the outcome of the litigation, the mere existence of this dispute with these
plaintiffs could lead to a decline in revenues generated from or through the
efforts of these plaintiffs and their respective downlines as well as an adverse
impact on the Company's relationship with IRs and the Company's ability to
attract potential IRs generally, all of which could have a material adverse
effect on the Company.
9
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Forward-Looking Information
Statements in this report concerning future results, performance,
achievements, expectations or trends, if any, are forward-looking statements.
Actual results, performance, achievements, events or trends could differ
materially from those expressed or implied by such forward-looking statements as
a result of known and unknown risks, uncertainties and other factors including
those described below and those identified by the Company in its Registration
Statement on Form S-1 filed with the Securities and Exchange Commission in
February 1996 as amended.
General
EXCEL, which was formed in December 1988 and commenced operations in 1989,
operates as a provider of long distance service to residential and small
business subscribers. The Company believes that, based upon domestic residential
long distance revenues, it ranks fourth after AT&T Corporation, MCI, and Sprint
Corporation.
In May 1996, a total of 11,500,000 shares of the Company's common stock were
sold in an initial public offering at $15 per share. Stockholders sold 1,700,000
shares, and 9,800,000 shares were sold by the Company which resulted in net
proceeds of approximately $134.4 million to the Company after deducting the
expenses of the offering.
The Company's services are marketed nationwide exclusively through a network
of IRs. The Company encourages IRs to enroll subscribers with whom the IRs have
an ongoing relationship as a result of being a family member, friend, business
associate, neighbor, or otherwise. This network marketing system has been
selected by the Company because the Company believes it reduces net marketing
costs, subscriber acquisition costs, and subscriber attrition. The Company
believes that subscribers will be more likely to remain with the Company because
they have been enrolled with the Company by someone with whom they have an
ongoing relationship. The Company also believes that its network marketing
system will continue to build a base of potential subscribers for additional
services and products.
The Company's revenues consist of sales revenues for communication services
and marketing services. Revenues for communication services, as reflected in the
Company's Consolidated Financial Statements, are net of the effect of certain
adjustments, including unbillable call records. The Company's long distance
subscribers are located throughout the United States, and the Company completes
subscriber calls to all directly dialable locations worldwide. The Company bills
its subscribers for long distance usage based on the type of calls, time of
calls, duration of calls, the terminating phone numbers, and each subscriber's
rate plan in effect at the time of the call.
Marketing services revenues are primarily comprised of receipts from IRs
and ACs. Except in certain states, IRs are required to make an initial
refundable application deposit with EXCEL as an expression of commitment. There
is no additional cost to participate. IRs have an option to purchase a start-up
package, which includes training, business forms, promotional and presentation
materials, ongoing technical and administrative support services and monthly
reports. If the start-up package is purchased, the application deposit
requirement is waived. In addition, EXCEL offers training positions whereby ACs,
certified by the Company, provide training to new IRs. The portions of the
marketing services revenues received that relate to ongoing technical and
administrative support services are deferred and amortized over a period of 12
months in order to match those revenues with the costs of providing the related
support services.
10
<PAGE>
Operating expenses include communication charges, marketing services costs,
and general and administrative expenses. Communication charges are paid by the
Company based on the Company's subscribers' long distance usage. The Company
pays its carriers based on the type of calls, time of certain calls, duration of
calls, the terminating phone numbers, and the terms of the Company's contract in
effect at the time of the calls.
Marketing services costs include commissions and the costs of providing
training, business forms, promotional and presentation materials, technical and
administrative support services, and monthly reports. When the Company's
marketing services costs are offset by its marketing services revenues, the net
expense represents the Company's net cost of marketing its communication
products. Commissions are paid to IRs based upon the acquisition of new long
distance subscribers and for long distance telephone usage by subscribers. The
Company also pays commissions for the training of IRs and ACs. The portions of
commissions paid that directly relate to the acquisition of long distance
subscribers are capitalized and amortized over a period of 12 months in order to
better match those costs with the revenue stream from subscribers' long distance
usage during the first 12 months of service to such subscribers.
The Company has historically purchased substantially all of its switching
and transmission facilities from one carrier, Frontier. Pursuant to an
agreement entered into in January 1996, the Company began transferring certain
of its long distance traffic (currently representing approximately 22% of the
Company's long distance traffic) to IXC Long Distance, Inc. ("IXC").
In June 1996, the Company and Frontier restructured their agreement to enable
the Company to utilize additional carriers to, among other things, accommodate
its growth and further ease its reliance on Frontier. Effective May 31, 1996,
the Company entered into a non-exclusive agreement with WorldCom Network
Services, Inc. ("WorldCom") to provide network switching services and dedicated
access services to EXCEL's subscribers. Under the new contract, EXCEL will
begin the migration of subscriber traffic to WorldCom's long distance network
during the third quarter of 1996. The contract also calls for a $900 million
cumulative commitment over four years. In June 1996, the Company entered into a
non-exclusive agreement with MCI to provide network switching services and
dedicated access services to EXCEL's subscribers. Under the new contract, EXCEL
will also begin migrating existing subscriber traffic to MCI's long distance
network during the third quarter of 1996. The contract calls for a $5 million
per month minimum commitment over the next two years. Upon completion of the
transition of long distance traffic to these new carriers, all 1-plus long
distance traffic will be moved from Frontier. EXCEL has agreed to leave certain
calling card and personal 800 traffic (representing approximately 7% of EXCEL's
current long distance minutes) with Frontier through April 30, 1999.
Results of Operations
Three Months Ended June 30, 1996 Compared to the Three Months Ended June 30,
1995
Revenues. Total revenues increased 254% to $345.4 million for the three
months ended June 30, 1996 from $97.7 million for the three months ended June
30, 1995. The increase in revenues was primarily due to increases in long
distance minutes of usage by subscribers and in the number of applications from
new IRs. Communication services revenues increased 304% to $271.9 million for
the three months ended June 30, 1996 from $67.3 million for the three months
ended June 30, 1995. Long distance minutes of usage increased 303% to
1,554,057,000 minutes for the three months ended June 30, 1996 from 386,054,000
minutes for the three months ended June 30, 1995.
Marketing services revenues increased 141% to $73.4 million for the three
months ended June 30, 1996 from $30.4 million for the three months ended June
30, 1995. These revenues increased primarily due to growth in applications from
new IRs to 220,710 applications received during the three months ended June 30,
1996, from 98,450 applications received during the three months ended June 30,
1995. The number of new IR applications in the second quarter of 1996 decreased
10% from 245,965 applications received during the first quarter of 1996. Based
upon incoming applications from new IRs
11
<PAGE>
during July 1996, the Company believes there will also be a decrease in
applications from the second quarter of 1996 to the third quarter of 1996. The
Company believes this decrease reflects reduced marketing activities following
the May 1996 initial public offering of the Company's common stock. In addition,
this decrease in marketing activities partially relates to the inability of the
Company's long distance transmission carriers to add the network capacity
necessary to handle the Company's significant growth in long distance traffic.
The decrease in applications from new IRs will, among other things, result in
a decrease in new long distance subscribers and a corresponding decrease in long
distance minutes of usage from new subscribers. In order to address these
issues, the Company is exploring the following initiatives:
* Developing promotions intended to revitalize the IRs marketing
activities;
* Continuing to build the infrastructure necessary to support the offering
of additional communications products; and
* Migrating long distance traffic to WorldCom, MCI, and IXC.
Operating Expenses. Communication charges increased 278% to $151.4 million
for the three months ended June 30, 1996 from $40.1 million for the three months
ended June 30, 1995. Partially offsetting this increase was a reduction in
communication charges per minute of 6.2%. As a percentage of long distance
revenues, communication charges were 56% for the three months ended June 30,
1996 compared to 60% for the three months ended June 30, 1995. This decrease in
communication charges as a percentage of long distance revenues reflects the
reduction in rates from the Company's long distance carrier that were
implemented from April 1995 through February 1996.
Total marketing services costs increased 215% to $93.8 million for the three
months ended June 30, 1996 from $29.8 million for the three months ended June
30, 1995. This increase is primarily due to growth in new IRs.
General and administrative expenses increased 200% to $43.5 million for the
three months ended June 30, 1996 from $14.5 million for the three months ended
June 30, 1995. As a percentage of long distance revenues, general and
administrative expenses were 16% for the three months ended June 30, 1996
compared to 22% for the three months ended June 30, 1995. Despite the overall
increase in expense, the June 30, 1996 decrease as a percent of revenues is
attributed to the gaining of economies of scale relative to growth in the
business.
Total operating income increased 322% to $56.6 million for the three months
ended June 30, 1996 from $13.4 million for the three months ended June 30, 1995.
As a percentage of long distance revenues, operating income was 21% for the
three months ended June 30, 1996 compared to 20% for the three months ended June
30, 1995. The increase in operating income as a percentage of long distance
revenues was primarily due to a decrease in communication charges per minutes of
usage.
Included in other income (expense) for the three months ended June 30, 1996 is
approximately $3.1 million of income related to the sale of the Company's 49%
investment in a joint venture. In addition, the Company's investment income
(expense) increased to $1.3 million for the three months ended June 30, 1996
from ($103,000) for the three months ended June 30, 1995. The increase in
investment income was primarily due to additional interest income generated by
the investment of cash proceeds received from the IPO.
Six Months Ended June 30, 1996 Compared to the Six Months Ended June 30, 1995
Revenues. Total revenues increased 276% to $626.2 million for the six
months ended June 30, 1996 from $166.5 million for the six months ended June 30,
1995. The increase in revenues was primarily due
12
<PAGE>
to increases in long distance minutes of usage by subscribers and in the number
of applications from new IRs. Communication services revenues increased 303% to
$477.2 million for the six months ended June 30, 1996 from $118.3 million for
the six months ended June 30, 1995. Long distance minutes of usage increased
324% to 2,781,770,000 minutes for the six months ended June 30, 1996 from
655,936,000 minutes for the six months ended June 30, 1995. Partially offsetting
these increases was a reduction in long distance revenues per minute of usage
of 4.9%. The decrease in revenues per minute was due primarily to a rate
reduction which took effect in the second quarter of 1995.
Marketing services revenues increased 210% to $149.0 million for the six
months ended June 30, 1996 from $48.1 million for the six months ended June 30,
1995. These revenues increased primarily due to growth in applications from new
IRs to 466,675 applications received during the six months ended June 30, 1996,
from 151,984 applications received during the six months ended June 30, 1995.
Operating Expenses. Communication charges increased 281% to $264.9 million
for the six months ended June 30, 1996 from $69.5 million for the six months
ended June 30, 1995. Partially offsetting this increase was a reduction in
communication charges per minute of 10.1%. As a percentage of long distance
revenues, communication charges were 56% for the six months ended June 30, 1996
compared to 59% for the six months ended June 30, 1995. This decrease in
communication charges as a percentage of long distance revenues reflects the
reduction in rates from the Company's long distance carrier that were
implemented from April 1995 through February 1996.
Total marketing services costs increased 234% to $170.8 million for the six
months ended June 30, 1996 from $51.1 million for the six months ended June 30,
1995. This increase is primarily due to growth in new IRs.
General and administrative expenses increased 238% to $80.4 million for the
six months ended June 30, 1996 from $23.8 million for the six months ended June
30, 1995. As a percentage of long distance revenues, general and administrative
expenses were 17% for the six months ended June 30, 1996 compared to 20% for the
six months ended June 30, 1995. Despite the overall increase in expense, the
June 30, 1996 decrease as a percent of revenues is attributed to the gaining of
economies of scale relative to growth in the business.
Total operating income increased 396% to $110.0 million for the six months
ended June 30, 1996 from $22.2 million for the six months ended June 30, 1995.
As a percentage of long distance revenues, operating income was 23% for the six
months ended June 30, 1996 compared to 19% for the six months ended June 30,
1995. The increase in operating income as a percentage of long distance revenues
was primarily due to a decrease in communication charges per minutes of usage
and the decrease in general and administrative expenses as a percentage of long
distance revenues.
Included in other income (expense) for the six months ended June 30, 1996 is
approximately $4.2 million of income related to the sale of the Company's 49%
investment in a joint venture. In addition, the Company's investment
income(expense) increased to $1.7 million for the six months ended June 30, 1996
from $(235,000) for the six months ended June 30, 1995. The increase in
investment income was primarily due to additional interest income generated by
the investment of cash proceeds received from the sale of the Company's common
stock in May 1996.
Liquidity and Capital Resources
As of June 30, 1996, the Company had cash and cash equivalents of $150.4
million, working capital of $164.0 million, and a revolving credit line
agreement with a bank. The amount available under the agreement is limited to
the lesser of $10 million or the borrowing base minus any letters of credit
outstanding. The Company had available borrowing capacity of $10 million at
June 30, 1996. Information pertaining to the Company's litigation is included in
Note 7 to the Company's Consolidated Financial Statements and should be read
in conjunction with the discussion of liquidity and capital resources.
13
<PAGE>
The Company's operating activities provided cash of approximately $47.3
million for the six months ended June 30, 1996 and $9.6 million for the six
months ended June 30, 1995. The increase is primarily due to the significant
growth in revenues and net income for the six months ended June 30, 1996 as
compared to the same period in 1995.
The Company's investing activities have consisted primarily of property and
equipment purchases of $41.5 million for the six months ended June 30, 1996 and
$2.4 million for the six months ended June 30, 1995. In addition, during the six
months ended June 30, 1995, the Company made a capital contribution of $2.8
million, to obtain a 49% interest in a joint venture. The joint venture was
formed for the purpose of obtaining and operating a long distance network to
provide telecommunications services to the Company and other long distance
providers. Subsequent to December 31, 1995, the Company sold its entire 49%
interest in the joint venture for a sales price of $6.2 million.
Total cash generated from / (used for) financing activities was $114.2 million
for the six months ended June 30, 1996 and $(3.2) million for the six months
ended June 30, 1995. The increase in cash was primarily due to proceeds from the
Company's initial public offering of its common stock in May 1996, which
resulted in net proceeds of approximately $134.4 million to the Company after
deducting the expenses of the offering. In addition, other financing activities
have consisted of payments of debt and capital lease obligations, and payments
of dividends. The Company made payments of debt and capital lease obligations of
$186,000 and payments of dividends of approximately $20.0 million during the six
months ended June 30, 1996.
Legislative and Regulatory Matters
On February 8, 1996, the 1996 Telecommunications Act was enacted into law.
This comprehensive federal legislation will affect every sector of the
telecommunications industry. Included in the new statutory provisions is the
opening up of local telephone markets to competition and, subject to certain
safeguards, the elimination of restrictions on Bell Operating Companies ("BOC")
and GTE Operating Companies ("GTOC") entry into the long distance
telecommunications market. It is unknown at this time what impact the 1996
Telecommunications Act will have on the Company. Depending on the nature and
timing of BOC and GTOC entry into the long distance market, the Company will
face significant additional competition in the provision of long distance
services.
The Pennsylvania Public Utility Commission ("PPUC") and the utility regulatory
bodies in all other states have approved the Company's reorganization that
occurred on January 1, 1996. However, the review by the Pennsylvania Attorney
General's ("PAG") Office of the Company's marketing practices, which originally
had delayed the approval of the reorganization by the PPUC, is continuing. In
addition to the continuing review by the PAG Office, similar discussions and
reviews relating to the Company's marketing practices are ongoing in various
other states. Various governmental agencies monitor direct selling activities,
and the Company has occasionally been requested to supply information regarding
its marketing plan to certain of such agencies. Although the Company believes
that its network marketing system is in substantial compliance with laws and
regulations of Pennsylvania and other states relating to direct selling
activities, there is no assurance that legislation and regulations adopted in
particular jurisdictions in the future will not adversely affect the Company's
operations.
14
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
FORM 10-Q
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
Information pertaining to this item is incorporated from Part I.
Financial Information (Item 1. Financial Statements - Note 7 to
Consolidated Financial Statements - Commitments and Contingencies -
Litigation, Claims, and Assessments) and (Item 2. Management's
Discussion and Analysis of Financial Condition and Results of
Operations - Legislative and Regulatory Matters).
ITEM 2. Changes in Securities
None.
ITEM 3. Defaults upon Senior Securities
None.
ITEM 4. Submission of Matter to a Vote of Security Holders
None.
ITEM 5. Other Information
None.
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits: The exhibits filed as part of this report are set forth
in the Index of Exhibits on page 17 of this report.
(b) Reports on Form 8-K:
1) Current report on Form 8-K dated June 3, 1996 regarding the
Company's carrier contract with WorldCom Network Services,
Inc.
2) Current report on Form 8-K dated June 26, 1996 regarding the
Company's carrier contract with MCI Telecommunications, Corp.
15
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
FORM 10-Q
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Excel Communications, Inc.
Date: August 6, 1996 /s/ John J. McLaine
------------------------ --------------------------------
John J. McLaine
Executive Vice President,
Chief Financial Officer
and Secretary
Date: August 6, 1996 /s/ Craig E. Holmes
------------------------ --------------------------------
Craig E. Holmes
Vice President and
Chief Accounting Officer
16
<PAGE>
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
EXHIBIT INDEX
The following exhibits are included in this Quarterly Report on Form 10-Q:
<TABLE>
<CAPTION>
Exhibit Number Exhibit Description
- ------------- -------------------
<S> <C>
3.1 Certificate of Incorporation of the Company dated
December 19, 1995, as amended January 11, 1996
(incorporated herein by reference to Exhibit 3.1 to
the Company's Registration Statement on Form S-1
(File No. 333-1076))
3.2 Bylaws of the Company (incorporated herein by
reference to Exhibit 3.2 to the Company's
Registration Statement on Form S-1 (File No. 333-
1076))
10.1 Telecommunications Services Agreement, dated May
31, 1996, between WorldCom Network Services, Inc.
d/b/a WilTel ("WilTel") and Excel Telecommunications, Inc.
10.2 Program Enrollment Terms, dated May 31, 1996,
between WilTel and Excel Telecommunications, Inc.*
10.3 Service Schedule, dated May 31, 1996, between
WilTel and Excel Telecommunications, Inc.*
10.4 Amendment No. 3 to Excel Reseller Services
Agreement, dated February 20, 1995 and effective
April 1, 1995, between Frontier Communications
Services, Inc. and Excel Telecommunications, Inc.
10.5 Carrier Agreement, dated June 26, 1996, between
MCI Telecommunications Corporation and Excel
Telecommunications, Inc.*
11 Computation of Net Income per Share
27 Financial Data Schedule as of June 30, 1996
</TABLE>
* Confidential treatment requested. A series of XXX's have been inserted in
these exhibits to indicate redactions in such exhibits for which confidential
treatment has been requested with certain exceptions as set forth below in
which a series of XXX's were a part of such exhibit. The redacted portions of
these agreements have been separately filed with the Secretary of the
Commission.
1) Exhibit 10.2, page 4 of 16, (NPA-NXX)
2) Exhibit 10.5, page 15, paragraph 19(f) (10XXX)
3) Exhibit 10.5, page 17, paragraph 22 (10XXX)
4) Exhibit 10.5, Attachment 2, page 1, paragraph (1)(b) (950-XXXX)
5) Exhibit 10.5, Attachment 2, page 2, paragraph (1)(f) (950-XXXX,
1-800-XXX-XXXX, 10XXX)
17
<PAGE>
EXHIBIT 10.1
TRANSCEND/TM/
TELECOMMUNICATIONS SERVICES AGREEMENT
-------------------------------------
This Telecommunications Services Agreement (the "Agreement" or the "TSA") is
entered into as of the 31st day of May, 1996, by and between WORLDCOM NETWORK
SERVICES, INC. d/b/a Wiltel, a Delaware corporation, with its principal office
at One Williams Center, Tulsa, Oklahoma 74172 ("WilTel") and EXCEL
TELECOMMUNICATIONS, INC., a Texas corporation, with its principal office at 9101
LBJ Freeway, Suite 800, Dallas, Texas 75243 ("Customer").
WITNESSETH:
WilTel agrees to provide and Customer agrees to accept switched
telecommunications services and other associated services (collectively the
"Services"), (i) as described in the Service Schedules attached hereto and
incorporated herein by this reference, (ii) subject to the terms and conditions
contained in this Agreement, including without limitation those terms and
conditions contained in the Program Enrollment Terms ("PET") which are attached
hereto and incorporated herein by reference, and (iii) in conformity with each
Service Request (described below) which is accepted hereunder.
In the event of a conflict between the terms of this Agreement, the PET, the
Service Schedule and the Service Request(s), the following order of precedence
will prevail: (1) PET, (2) Service Schedule, (3) this Agreement, and (4)
Service Request(s).
NOW, THEREFORE, in consideration of the above premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. Service Term.
------------
(A) Effective Date This Agreement shall commence as of the Effective Date
--------------
as described in the PET and shall continue for the period of time set forth
in the PET (the "Service Term"). Upon the expiration of the Service Term,
the Service in question will continue to be provided subject to termination
by either party upon thirty (30) days prior written notice to the other
party. Customer shall be liable for all charges associated with actual usage
of the Services in question during the Service Term and any extension
thereof.
(B) PET The PET, as executed by the parties, shall set forth the Discount
---
Schedule applicable to charges for Switched Services due under this
Agreement, Customer's minimum monthly commitment, if any, and other
information necessary to provide the Services under this Agreement.
(C) Start of Service WilTel's obligation to provide and Customer's
----------------
obligation to accept and pay for non-usage sensitive charges for Services
shall be binding to the extent provided for in this Agreement upon the
submission of an acceptable Service Request to WilTel by Customer.
Customer's obligation to pay for usage sensitive charges for Switched
Services shall commence with respect to any Service as of the earlier of (i)
the "Requested Service Date" set forth in each Service Request, or (ii) the
date the Service in question is made available to Customer and used ("Start
of Service"). Start of Service for particular Services shall be further
described in the Service Schedule relevant to the Switched Services in
question.
2/25/96 Page 1 of 11 CONFIDENTIAL
------------
<PAGE>
(D) Service Schedules Services to be provided under this Agreement
-----------------
shall be described in the WilTel Service Schedule which is executed by
WilTel and Customer in connection with this Agreement (the "Service
Schedule"). The Service Schedule shall become a part of this Agreement
to the extent that it describes the particular Services therefor,
specific terms and other information necessary or appropriate for WilTel
to provide such Service to Customer.
(E) Service Requests Customer's requests to initiate or cancel
----------------
Services shall be described in an appropriate WilTel Service Request
("Service Requests"). Service Requests may consist of machine readable
tapes, facsimiles or other means approved by WilTel. Further, Service
Requests shall specify all reasonable information, as determined by
WilTel, necessary or appropriate for WilTel to provide the Service(s) in
question, which shall include without limitation, the type, quantity and
end point(s) (when necessary) of circuits comprising a Service
Interconnection as described in the applicable Service Schedules, or
automatic number identification ("ANI") information relevant to the
Service(s), the Requested Service Date, and charges, if any, relevant to
the Services described in the Service Request. After WilTel's receipt
and verification of a valid Service Request for SWITCHED Service (as
defined in the Service Schedule) requiring a change in the primary
interexchange carrier ("PIC"), WilTel agrees to (i) submit the ANI(s)
relevant to such Service Requests to the following local exchange
carriers ("LECs") (with which WilTel currently has electronic interface
capabilities) within ten (10) days: Ameritech, Bell Atlantic, BellSouth,
Nynex, Pacific Bell, Southwester Bell, US West, GTE and United, and (ii)
submit the ANI(s) relevant to such Service Requests to those LECs with
which WilTel does not have electronic interface capabilities within a
reasonable time.
2. Cancellation.
------------
(A) Cancellation Charge At any time after the Effective Date,
-------------------
Customer may cancel this Agreement if Customer provides written
notification thereof to WilTel not less than thirty (30) days prior to
the effective date of cancellation. In such case (or in the event WilTel
terminates this Agreement as provided in Section 8), Customer shall pay
to WilTel all charges for Services provided through the effective date
of such cancellation plus a cancellation charge (the "Cancellation
Charge") equal to one hundred percent (100%) of Customer's
commitment(s), if any, (as described in the PET) that would have become
due for the unexpired portion of the Service Term. Provided, however, if
Customer cancels or terminates this Agreement for cause as defined in
this Agreement, then Customer shall not be liable for or obligated to
pay any Cancellation Charge.
(B) Liquidated Damages It is agreed that WilTel's damages in the event
------------------
Customer cancels this Agreement shall be difficult or impossible to
ascertain. The provision for a cancellation charge in Subsection 2(A)
above is intended, therefore, to establish liquidated damages in the
event of a cancellation and to be WilTel's sole remedy hereunder and is
not intended as a penalty.
(C) Cancellation Without Charge Notwithstanding anything to the
---------------------------
contrary contained in Subsection 2(A) above, Customer may cancel this
Agreement without incurring any cancellation charge if (i) WilTel fails
to provide a network as warranted in Section 9 below; (ii) WilTel fails
to deliver call detail records promptly based on the frequency selected
by Customer (i.e., monthly, weekly or daily); or (iii) WilTel fails to
submit ANI(s) relevant to such Service Requests to the LECs within the
2/25/96 Page 2 of 11 CONFIDENTIAL
------------
<PAGE>
time period described in Subsection 1(E) above. Provided, however,
Customer must give WilTel written notice of any such default and an
opportunity to cure such default within five (5) days of the notice. In
the event WilTel fails to cure any such default within the five-day
period on more than three (3) occasions within any six (6) month period,
Customer may cancel this Agreement without incurring any cancellation
charge.
3. Customer's End Users.
--------------------
(A) End Users Customer will obtain and upon WilTel's reasonable
---------
request provide WilTel (within two (2) business days of the date of the
request) a written Letter of Agency ("LOA") acceptable to WilTel [or
with any other means approved by the Federal Communications Commission
("FCC")], for each ANI indicating the consent of the end users of
Customer ("End Users") to be served by Customer and transferred (by way
of change of such End User's designated PIC) to the WilTel network prior
to order processing. Each LOA will provide, among other things, that the
End Users have consented to the transfer being performed by Customer or
Customer's designee. When applicable, Customer will be responsible for
notifying End Users, in writing (or by any other means approved by the
FCC) that (i) a transfer charge will be reflected on their LEC bill for
effecting a change in their primary interexchange carrier ("PIC"), (ii)
the entity name under which their interstate, intrastate and/or operator
services will be billed (if different from Customer), and (iii) the
"primary" telephone number(s) to be used for maintenance and questions
concerning their long distance service and/or billing. Customer agrees
to send WilTel a copy of the documentation Customer uses to satisfy the
above requirements promptly upon request of WilTel. WilTel may change
the foregoing requirements for Customer's confirming orders and/or for
notifying End Users regarding the transfer charge at any time in order
to conform with applicable FCC and state regulations. Provided, however,
Customer will be solely responsible for ensuring that the transfer of
End Users to the WilTel network conforms with applicable FCC and state
regulations, including without limitation, the regulations established
by the FCC with respect to verification of orders for long distance
service generated by telemarketing as promulgated in 47 C.F.R., Part 64,
Subpart K, (S)64.1100 or any successor regulation(s).
(B) Transfer Charges/Disputed Transfers Customer agrees that it is
-----------------------------------
responsible for (i) all charges incurred by WilTel to change the PIC of
End Users to the WilTel network, (ii) all charges incurred by WilTel to
change End Users back to their previous PIC arising from disputed
transfers to the WilTel network plus an administrative charge equal to
twenty percent (20%) of such charges, and (iii) any other damages
suffered by or awards against WilTel resulting from disputed transfers.
(C) Excluded ANIs WilTel has the right to reject any ANI supplied by
-------------
Customer for any of the following reasons: (i) WilTel is not authorized
to provide or does not provide long distance services in the particular
jurisdiction in which the ANI is located, (ii) a particular ANI
submitted by Customer is not in proper form, (iii) Customer is not
certified to provide long distance services in the jurisdiction in which
the ANI is located, (iv) Customer is in default of this Agreement, (v)
Customer fails to cooperate with WilTel in implementing reasonable
verification processes determined by WilTel to be necessary or
appropriate in the conduct of business, or (vi) any other circumstance
reasonably determined by WilTel which could adversely affect WilTel's
performance under this Agreement or WilTel's general ability to transfer
its other customers or other end users to the WilTel network, including
without limitation, WilTel's ability to electronically effect PIC
2/25/96 Page 3 of 11 CONFIDENTIAL
------------
<PAGE>
changes with the LECs. In the event WilTel rejects an ANI, WilTel will
notify Customer as soon as possible of its decision specifically
describing the rejected ANI and the reason(s) for rejecting that ANI,
and will not incur any further liability under this Agreement with
regard to that ANI. Further, any ANI requested by Customer for Switched
Services may be deactivated by WilTel if no Switched Services billings
relevant thereto are generated in any three (3) consecutive calendar
month/billing periods. WilTel will be under no obligation to accept ANIs
within the three (3) full calendar month period preceding the scheduled
expiration of the Service Term.
(D) Records Customer will maintain documents and records ("Records")
-------
supporting Customer's re-sale of Switched Services, including, but not
limited to, appropriate and valid LOAs from End Users for a period of
not less than (twelve) 12 months or such other longer period as may be
required by applicable law, rule or regulation. Customer shall indemnify
WilTel for any costs, charges or expenses incurred by WilTel arising
from disputed PIC selections involving Switched Services to be provided
to Customer for which Customer cannot produce an appropriate LOA
relevant to the ANI and PIC charge in question, or when WilTel is not
reasonably satisfied that the validity of a disputed LOA has been
resolved.
(E) Customer Service Customer will be solely responsible for billing
----------------
the End Users and providing the End Users with customer service.
Customer agrees to notify WilTel as soon as practicable in the event an
End User notifies Customer of problems associated with the Services,
including without limitation, excess noise, echo, or loss of Service.
4. Customer's Responsibilities.
---------------------------
(A) Expedite Charges In the event Customer requests expedited Services
----------------
and/or changes to Service Orders and WilTel agrees to such request,
WilTel will pass through the charges assessed by any supplying parties
(e.g., local access providers) for such expedited charges and/or changes
to Service Orders involved at the same rate to Customer. WilTel may
further condition its performance of such request upon Customer's
payment of such additional charges to WilTel.
(B) Fraudulent Calls Customer shall indemnify and hold WilTel harmless
----------------
from all costs, expenses, claims or actions arising from fraudulent
calls of any nature which may comprise a portion of the Services to the
extent that the party claiming the call(s) in question to be fraudulent
is (or had been at the time of the call) an End User of the Services
through Customer or an end user of the Services through Customer's
distribution channels. Customer shall not be excused from paying WilTel
for Services provided to Customer or any portion thereof on the basis
that fraudulent calls comprised a corresponding portion of the Services.
In the event WilTel discovers fraudulent calls being made (or reasonably
believes fraudulent calls are being made), nothing contained herein
shall prohibit WilTel from taking immediate action (without notice to
Customer) that is reasonably necessary to prevent such fraudulent calls
from taking place, including without limitation, denying Services to
particular ANIs or terminating Services to or from specific locations.
5. Charges and Payment Terms.
-------------------------
(A) Payment WilTel billings for Services hereunder are made on a
-------
monthly basis (or such other basis as may be mutually agreed to by the
parties) following Start of Service. Subject to Subsection 5(D) below,
Services shall be billed at the rates set forth in the PET and Service
2/25/96 Page 4 of 11 CONFIDENTIAL
------------
<PAGE>
Requests, as the case may be. Discounts, if any, applicable to the rates
for certain Services are set forth in the PET. Customer will pay all
undisputed charges relative to each WilTel invoice for Services within
thirty (30) days of the invoice date set forth on each WilTel invoice to
Customer ("Due Date"). If payment is not received by WilTel on or before
the Due Date, Customer shall also pay a late fee in the amount of the
lesser of one and one-half percent (1-1/2%) of the unpaid balance of the
charges for Services rendered per month or the maximum lawful rate under
applicable state law.
(B) Definitions Time of day rate periods (including WilTel Recognized
-----------
National Holidays) will be as described in WilTel's F.C.C. Tariff No.5.
(C) Taxes Customer acknowledges and understands that WilTel computes
-----
all charges herein exclusive of any applicable federal, state or local
use, excise, gross receipts, sales and privilege taxes, duties, fees or
similar liabilities (other than general income or property taxes),
whether charged to or against WilTel or Customer because of the Services
furnished to Customer ("Additional Charges"). Customer shall pay such
Additional Charges in addition to all other charges provided for herein.
(D) Modification of Charges WilTel reserves the right to eliminate
-----------------------
Services and/or modify charges for Services (which charge modifications
may include time of day rate periods and shall not exceed then-current
generally available WilTel charges for comparable services), upon not
less than sixty (60) days prior notice to Customer, which notice will
state the effective date for the charge modification. In the event
WilTel notifies Customer of the elimination of a particular Service and/
or an increase in the charges, Customer may terminate this Agreement,
without incurring a cancellation charge only with respect to the
Services affected by the increase in charges. In order to cancel such
Services, Customer must notify WilTel, in writing, at least thirty (30)
days prior to the effective date of the increase in charges. Further, in
the event Customer cancels its subscription to a particular Service as
described in this Subsection 5(D), WilTel and Customer agree to
negotiate in good faith concerning Customer's minimum monthly
commitment, if any, described in the PET.
(E) Billing Disputes Notwithstanding the foregoing, late fees shall
----------------
apply (but shall not be due and payable for a period of sixty (60) days
following the Due Date therefor) for amounts reasonably disputed by
Customer, provided Customer: (i) pays all undisputed charges on or
before the Due Date, (ii) presents a written statement of any billing
discrepancies to WilTel in reasonable detail on or before the Due Date
of the invoice in question, and (iii) negotiates in good faith with
WilTel for the purpose of resolving such dispute within said sixty (60)
day period. In the event such dispute is resolved in the favor of
WilTel, Customer agrees to pay WilTel the disputed amounts together with
any applicable late fees within ten (10) days of the resolution. In the
event such dispute is resolved in favor of Customer, Customer will
receive a credit for the disputed charges in question and the applicable
late fees. In the event the dispute can not be resolved within such
sixty (60) day period (unless WilTel has agreed in writing to extend
such period) all disputed amounts together with late fees shall become
due and payable, and this provision shall not be construed to prevent
Customer from pursuing any available legal remedies. WilTel shall not be
obligated to consider any Customer notice of billing discrepancies which
are received by WilTel more than sixty (60) days following the Due Date
of the invoice in question.
2/25/96 Page 5 of 11 CONFIDENTIAL
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<PAGE>
(F) Suspension of Service In the event all undisputed charges due pursuant
---------------------
to WilTel's invoice are not paid in full by the Due Date or disputed charges
owed by Customer, if any, are not paid in full by the time specified as
described in Subsection 5(E) above, WilTel shall have the right, after
giving Customer ten (10) days prior notice and opportunity to pay such
charges, to suspend all or any portion of the Services to Customer
("Suspension Notice") until such time (designated by WilTel in its
Suspension Notice) as Customer has paid in full all undisputed charges then
---
due to WilTel, including any late fees. Following such payment, WilTel shall
reinstitute Services to Customer only when Customer provides WilTel with
----
satisfactory assurance of Customer's ability to pay for Services (i.e., a
deposit, letter of credit or other means acceptable to WilTel) and
Customer's advance payment of the cost of reinstituting Services. If
Customer fails to make the required payment by the date set forth in the
Suspension Notice, Customer will be deemed to have canceled the Services
suspended effective as of the date of suspension. Such cancellation shall
not relieve Customer for payment of applicable cancellation charges as
described in Section 2.
6. Credit: Customer's execution of this Agreement signifies Customer's
------
acceptance of WilTel's initial and continuing credit approval procedures and
policies. WilTel reserves the right to withhold initiation or full
implementation of Services under this Agreement pending WilTel's initial
satisfactory credit review and approval thereof which may be conditioned upon
terms specified by WilTel, including, but not limited to, security for payments
due hereunder in the form of a cash deposit or other means. WilTel reserves the
right to modify its requirements, if any, with respect to any security or other
assurance provided by Customer for payments due hereunder in light of Customer's
actual usage when compared to projected usage levels upon which any security or
assurance requirement was based.
7. Creditworthiness: If at any time there is a material adverse change in
----------------
Customer's creditworthiness, then in addition to any other remedies available to
WilTel, WilTel may elect, in its sole discretion, to exercise one or more of the
following remedies: (i) cause Start of Service for Services described in a
previously executed Service Request to be withheld; (ii) cease providing
Services pursuant to a Suspension Notice in accordance with Section 5(F); (iii)
decline to accept a Service Request or other requests from Customer to provide
Services which WilTel may otherwise be obligated to accept and/or (iv) condition
its provision of Services or acceptance of a Service Request on Customer's
assurance of payment which shall be a deposit or such other means to establish
reasonable assurance of payment. An adverse material change in Customer's
creditworthiness shall include, but not be limited to: (i) Customer's default of
its obligations to WilTel under this or any other agreement with WilTel; (ii)
failure of Customer to make full payment of all undisputed charges due hereunder
on or before the Due Date on three (3) or more occasions during any period of
twelve (12) or fewer months or Customer's failure to make such payment on or
before the Due Date in any two (2) consecutive months; (iii) acquisition of
Customer (whether in whole or by majority or controlling interest) by an entity
which is insolvent, which is subject to bankruptcy or insolvency proceedings,
which owes past due amounts to WilTel or any entity affiliated with WilTel or
which is a materially greater credit risk than Customer; or, (iv) Customer's
being subject to or having filed for bankruptcy or insolvency proceedings or the
legal insolvency of Customer.
8. Remedies for Breach. In the event Customer is in material breach of this
-------------------
Agreement, including without limitation, failure to pay all undisputed charges
due hereunder by the date stated in the Suspension Notice described in
Subsection 5(F), WilTel shall have the right, after giving Customer five
2/25/96 Page 6 of 11 CONFIDENTIAL
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<PAGE>
(5) days prior notice and opportunity to cure, and in addition to foreclosing
any security interest WilTel may have, to (i) terminate this Agreement; (ii)
withhold billing information from Customer; and/or (iii) contact the End Users
(for whom calls are originated and terminated solely over facilities comprising
the WilTel network) directly and bill such End Users directly until such time as
WilTel has been paid in full for the amount owed by Customer. If Customer fails
to make payment by the date stated in the Suspension Notice and WilTel, after
giving Customer five (5) days prior notice, terminates this Agreement as
provided in this Section 8, such termination shall not relieve Customer for
payment of applicable cancellation charges as described in Section 2 above.
9. Warranty. WilTel will use reasonable efforts under the circumstances to
--------
maintain its overall network quality. The quality of Services provided
hereunder shall be consistent with telecommunications common carrier industry
standards, government regulations and sound business practices. WILTEL MAKES NO
OTHER WARRANTIES ABOUT THE SERVICES PROVIDED HEREUNDER, EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE.
10. Liability; General Indemnity; Reimbursement.
-------------------------------------------
(A) Limited Liability IN NO EVENT WILL EITHER PARTY HERETO BE LIABLE TO
-----------------
THE OTHER PARTY FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
LOSSES OR DAMAGES, INCLUDING WITHOUT LIMITATION, LOSS OF REVENUE, LOSS
OF CUSTOMERS OR CLIENTS, LOSS OF GOODWILL OR LOSS OF PROFITS ARISING IN
ANY MANNER FROM THIS AGREEMENT AND THE PERFORMANCE OR NONPERFORMANCE OF
OBLIGATIONS HEREUNDER.
(B) General Indemnity In the event parties other than Customer (e.g.,
-----------------
Customer's End Users) shall have use of the Services through Customer, then
Customer agrees to forever indemnify and hold WilTel, its affiliated
companies and any third-party provider or operator of facilities employed
in provision of the Services harmless from and against any and all claims,
demands, suits, actions, losses, damages, assessments or payments which
those parties may assert arising out of or relating to any defect in the
Services unless such defect is caused solely by the gross negligence or
willful misconduct of WilTel.
(C) Reimbursement Customer agrees to reimburse WilTel for all reasonable
-------------
costs and expenses incurred by WilTel due to WilTel's direct participation
(either as a party or witness) in any administrative, regulatory or
criminal proceeding concerning Customer if WilTel's involvement in said
proceeding is based on Customer's misconduct or violation of any applicable
law or regulation.
11. Force Majeure. If WilTel's performance of this Agreement or any obligation
-------------
hereunder is prevented, restricted or interfered with by causes beyond its
reasonable control including, but not limited to, acts of God, fire, explosion,
vandalism, cable cut, storm or other similar occurrence, any law, order,
regulation, direction, action or request of the United States government, or
state or local governments, or of any department, agency, commission, court,
bureau, corporation or other instrumentality of any one or more such
governments, or of any civil or military authority, or by national emergency,
insurrection, riot, war, strike, lockout or work stoppage or other labor
difficulties, or supplier failure, shortage, breach or delay, then WilTel shall
be excused from such performance on a day-to-day basis to the extent of such
restriction or interference. WilTel shall use reasonable efforts under the
circumstances to avoid or remove such causes or nonperformance and shall proceed
to perform with reasonable dispatch whenever such causes are removed or cease.
2/25/96 Page 7 of 11 CONFIDENTIAL
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<PAGE>
12. State Certification. Customer warrants that in all jurisdictions in
-------------------
which it provides long distance services that require certification, it has
obtained the necessary certification from the appropriate governmental
authority. Further, if required by WilTel, Customer agrees to provide proof of
such certification acceptable to WilTel. In the event Customer is prohibited,
either on a temporary or permanent basis, from continuing to conduct its
telecommunications operations in a given state, Customer shall (i) immediately
notify WilTel by facsimile, and (ii) send written notice to WilTel within
twenty-four (24) hours of such prohibition.
13. Interstate/Intrastate Service. Except with respect to Services
-----------------------------
specifically designated as intrastate Services or international Services, the
rates provided to Customer in a Service Schedule are applicable only to Services
if such Services are used for carrying interstate telecommunications (i.e.,
Services subject to FCC jurisdiction). WilTel shall not be obligated to provide
Services with end points within a single state or Services which
originate/terminate at points both of which are situated within a single state.
In those states where WilTel is authorized to provide intrastate service (i.e.,
telecommunications transmission services subject to the jurisdiction of state
regulatory authorities), WilTel will, at its option, provide intrastate Services
pursuant to applicable state laws, regulations and applicable tariff, if any,
filed by WilTel with state regulatory authorities as required by applicable law.
14. Authorized Use of WilTel Name. Without the other party's prior written
-----------------------------
consent, neither party shall (i) refer to itself as an authorized representative
of the other party whenever it refers to the Services in promotional,
advertising or other materials, or (ii) use the other party's logos, trade
marks, service marks, or any variations thereof in any of its promotional,
advertising or other materials. Additionally, each party shall provide to the
other party for its prior review and written approval, all promotions,
advertising or other materials or activity using or displaying the other party's
name or the Services to be provided hereunder. Each party agrees to change or
correct, at such party's expense, any such material or activity which the other
party, in its sole reasonable judgment, determines to be inaccurate, misleading
or otherwise objectionable. Customer is explicitly authorized to only use the
following statements in its sales literature or if in response to the inquiry by
Customer's end user: (i) "Customer utilizes the WilTel network", (ii) "Customer
utilizes WilTel's facilities", (iii) "WilTel provides only the network
facilities", and (iv) "WilTel is our [or one of our] network services provider".
15. Notices. Notices under this Agreement shall be in writing and delivered to
-------
the person identified below at the offices of the parties as they appear below
or as otherwise provided for by proper notice hereunder. Customer shall notify
WilTel in writing if Customer's billing address is different than the address
shown below. The effective date for any notice under this Agreement shall be
the date of actual receipt of such notice by the appropriate party,
notwithstanding the date of mailing or transmittal via hand delivery or
facsimile.
If to WilTel: WorldCom Network Services, Inc.
One Williams Center, 28th Floor
Tulsa, OK 74172
Attn: Carrier Sales Dept.
2/25/96 Page 8 of 11 CONFIDENTIAL
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<PAGE>
If to Customer: Excel Telecommunications, Inc.
9101 LBJ Freeway, Suite 800
Dallas, TX 75243
Attn: Kenny A. Trout
Telephone No. (214) 863-8788
----------------------
Fax No.: (214) 863-8777
---------------------------
16. No-Waiver. No term or provision of this Agreement shall be deemed waived
---------
and no breach or default shall be deemed excused unless such waiver or consent
shall be in writing and signed by the party claimed to have waived or consented.
A consent to waiver of or excuse for a breach or default by either party,
whether express or implied, shall not constitute a consent to, waiver of, or
excuse for any different or subsequent breach or default.
17. Partial Invalidity; Government Action.
-------------------------------------
(A) Partial Invalidity If any part of any provision of this Agreement or
------------------
any other agreement, document or writing given pursuant to or in connection
with this Agreement shall be invalid or unenforceable under applicable law,
rule or regulation, that part shall be ineffective to the extent of such
invalidity only, without in any way affecting the remaining parts of that
provision or the remaining provisions of this Agreement. In such event,
Customer and WilTel will negotiate in good faith with respect to any such
invalid or unenforceable part to the extent necessary to render such part
valid and enforceable.
(B) Government Action Upon thirty (30) days prior notice, either party
-----------------
shall have the right, without liability to the other, to cancel an affected
portion of the Service if any material rate or term contained herein and
relevant to the affected Service is substantially changed by the other
party (to the detriment of the terminating party) or found to be unlawful
or the relationship between the parties hereunder is found to be unlawful
by order of the highest court of competent jurisdiction to which the matter
is appealed, the FCC, or other local, state or federal government authority
of competent jurisdiction.
18. Exclusive Remedies. Except as otherwise specifically provided for herein,
------------------
the remedies set forth in this Agreement comprise the exclusive remedies
available to either party at law or in equity.
19. Use of Service. Upon WilTel's acceptance of a Service Request hereunder,
--------------
WilTel will provide the Services specified therein to Customer upon condition
that, to Customer's best knowledge, the Services shall not be used for any
unlawful purpose. The provision of Services will not create a partnership or
joint venture between the parties or result in a joint communications service
offering to any third parties, and WilTel and Customer agree that this
Agreement, to the extent it is subject to FCC regulation, is an inter-carrier
agreement which is not subject to the filing requirements of Section 211(a) of
the Communications Act of 1934 (47 U.S.C. (S) 211(a)) as implemented in 47
C.F.R. (S) 43.51.
20. Choice of Law; Forum.
--------------------
(A) Law This Agreement shall be construed under the laws of the State of
---
Oklahoma without regard to choice of law principles.
(B) Forum Any legal action or proceeding with respect to this Agreement
-----
may be brought in the Courts of the State of Oklahoma in and for the County
of Tulsa or the United States of America for the Northern District of
Oklahoma. By execution of this Agreement, both Customer and WilTel hereby
submit to such jurisdiction, hereby expressly waiving
2/25/96 Page 9 of 11 CONFIDENTIAL
------------
<PAGE>
whatever rights may correspond to either of them by reason of their present
or future domicile. In furtherance of the foregoing, Customer and WilTel
hereby agree to service by U.S. Mail at the notice addresses referenced in
Section 15. Such service shall be deemed effective upon the earlier of
actual receipt or seven (7) days following the date of posting.
21. Proprietary Information.
-----------------------
(A) Confidential Information The parties understand and agree that the
------------------------
terms and conditions of this Agreement (but not the existence thereof), all
documents referenced herein (including invoices to Customer for Services
provided hereunder), communications between the parties and/or their
respective agents regarding this Agreement or the Services to be provided
hereunder (including price quotes to Customer for any Services proposed to
be provided or actually provided hereunder), as well as such information
relevant to any other agreement between the parties (collectively
"Confidential Information"), are confidential as between Customer and
WilTel.
(B) Limited Disclosure A party shall not disclose Confidential Information
------------------
unless subject to discovery or disclosure pursuant to legal process, or to
any other party other than the directors, officers, and employees of a
party or a party's agents including their respective attorneys,
consultants, brokers, lenders, insurance carriers or bona fide prospective
purchasers who have specifically agreed in writing to nondisclosure of the
terms and conditions hereof. Any disclosure hereof required by legal
process shall only be made after providing the non-disclosing party with
notice thereof in order to permit the non-disclosing party to seek an
appropriate protective order or exemption. Violation by a party or its
agents of the foregoing provisions shall entitle the non-disclosing party,
at its option, to obtain injunctive relief without a showing of irreparable
harm or injury and without bond.
(C) Press Releases Except as provided in Section 14 above, the parties
--------------
further agree that any press release, advertisement or publication
generated by a party regarding this Agreement, the Services provided
hereunder or in which a party desires to mention the name of the other
party or the other party's parent or affiliated company(ies), will be
submitted to the non-publishing party for its written approval prior to
publication.
(D) Survival of Confidentiality The provisions of this Section 21 will be
---------------------------
effective as of the date of this Agreement and remain in full force and
effect for a period which will be the longer of (i) one (1) year following
the date of this Agreement, or (ii) one (1) year from the termination of
all Services hereunder.
22. Successors and Assignment. This Agreement shall be binding upon and inure
-------------------------
to the benefit of the parties hereto and their respective successors or assigns,
provided, however, that Customer shall not assign or transfer its rights or
obligations under this Agreement without the prior written consent of WilTel,
which consent shall not be unreasonably withheld or delayed, and further
provided that any assignment or transfer without such consent shall be void.
23. General.
-------
(A) Survival of Terms The terms and provisions contained in this Agreement
-----------------
that by their sense and context are intended to survive the performance
thereof by the parties hereto shall so survive the
2/25/96 Page 10 of 11 CONFIDENTIAL
------------
<PAGE>
completion of performance and termination of this Agreement, including,
without limitation, provisions for indemnification and the making of any
and all payments due hereunder.
(B) Headings Descriptive headings in this Agreement are for convenience
--------
only and shall not affect the construction of this Agreement.
(C) Industry Terms Words having well-known technical or trade meanings
--------------
shall be so construed, and all listings of items shall not be taken to be
exclusive, but shall include other items, whether similar or dissimilar to
those listed, as the context reasonably requires.
(D) Rule of Construction No rule of construction requiring interpretation
--------------------
against the drafting party hereof shall apply in the interpretation of this
Agreement.
24. Entire Agreement. This Agreement consists of (i) all the terms and
----------------
conditions contained herein, and, (ii) all documents incorporated herein
specifically by reference. This Agreement constitutes the complete and
exclusive statement of the understandings between the parties and supersedes all
proposals and prior agreements (oral or written) between the parties relating to
Service provided hereunder. No subsequent agreement or amendment to this
Agreement, the PET or the Service Schedules between the parties concerning the
Services shall be effective or binding unless it is made in writing and
subscribed to by authorized representatives of Customer and WilTel.
IN WITNESS WHEREOF, the parties have executed this Telecommunications
Services Agreement on the date first written above.
WORLDCOM NETWORK SERVICES, INC. EXCEL TELECOMMUNICATIONS, INC.
d/b/a WilTel
By: /s/ Charles M. Cole III By: /s/ Kenny A. Troutt
--------------------------- ----------------------------
(Signature) (Signature)
Charles M. Cole III Kenny A. Troutt
- -------------------------------- ---------------------------------
(Print Name) (Print Name)
Vice President, Carrier Sales President and CEO
- -------------------------------- ---------------------------------
(Title) (Title)
2/25/96 Page 11 of 11 CONFIDENTIAL
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<PAGE>
EXHIBIT 10.2
TRANSCEND(TM)
PROGRAM ENROLLMENT TERMS
------------------------
These Program Enrollment Terms ("PET") are made by and between WorldCom
Network Services, Inc. d/b/a WilTel ("WilTel") and Excel Telecommunications,
Inc. ("Customer") and are part of their agreement for switched services, more
particularly identified as TSA#EXC-960415 (the "TSA"). In accordance with the
TSA, charges to Customer for Service obtained thereunder shall be subject to the
charges and discounts set forth below and the TSA shall be deemed to include all
of the terms and conditions set forth herein. The TSA, this PET and the Service
Schedule are collectively referred to as the "Agreement".
1. SERVICE TERM: The parties agree to substitute Subsection 1(A) of the
Agreement to read in its entirety as follows:
(A) Effective Date This Agreement shall commence as of May 31, 1996 (the
-------------- --- -- ----
"Effective Date") and shall continue for a period of forty-eight (48) months
thereafter (the "Initial Service Term"). Upon the expiration of the Initial
Service Term, this Agreement shall automatically renew for successive one
(1) year terms ("Extension Periods"), unless either party gives ninety (90)
days written notice prior to the expiration of the Initial Service Term or
any Renewal Period. Customer shall be liable for all charges associated with
actual usage of the Services in question during the Service Term and any
extension thereof. WilTel will not be obligated to accept any Service
Request under this Agreement if Customer's initial Service Request is (i)
not submitted by Customer within thirty (30) days of the date of this PET,
and (ii) not subject to a Requested Service Date within ninety (90) days of
the Effective Date.
2. RATES: Rates for Services hereunder will be generally comprised of the
following charges, if applicable: (i) local exchange company ("LEC") charges
(including without limitation, access charges, egress charges, SMS 800
queries, etc.), (ii) domestic transport charges (i.e., transport within the
continental United States), (iii) if applicable, Non-Mainland transport
charges or International transport charges, and (iv) applicable surcharges
(e.g., directory assistance). For illustration purposes only, attached
hereto are examples of how the various charges are applied based solely on
the assumptions and information shown therein.
(A) DOMESTIC TRANSPORT CHARGES.
(1) "Domestic Transport Charges" are based on the location (i.e., Tier
A, Tier B or Tier C) of the originating and terminating local access
transport areas ("LATAs") (excluding TRAVEL CARD Service). A list of
the LATAs comprising Tier A, Tier B and Tier C LATAs is shown on
Schedule "1" attached hereto and incorporated herein by reference. The
Domestic Transport Charge will be assessed on all completed or answered
calls and will be based upon the number of originating seconds.
Transport Charges will be billed in six-second increments and will be
subject to a six-second minimum charge. The Transport Charge for each
Tier (the "Tier Charge") relative to each Service is shown below:
2/25/96 Page 1 of 16 CONFIDENTIAL
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<PAGE>
(2) The Tier Charges for SWITCHED ACCESS Service and DEDICATED ACCESS
Service calls (regardless of jurisdiction) within the continental United
States are shown below.
(i) BASE RATES - Day
Tier A XXXXXXX
Tier B XXXXXXX
Tier C XXXXXXX
(ii) BASE RATES - NonDay
Tier A XXXXXXX
Tier B XXXXXXX
Tier C XXXXXXX
With respect to SWITCHED ACCESS Service and DEDICATED ACCESS Service calls
within the continental United States, the Transport Charge will be
comprised of an originating Tier Charge and a terminating Tier Charge. The
table below shows the total Tier Charges for SWITCHED ACCESS Service and
DEDICATED ACCESS Service calls taking into account the various originating
Tiers and terminating Tiers.
(iii) Base Rates - Day
==========================================
Tier A Tier B Tier C
------------------------------------------
Tier A XXXXXX XXXXXX XXXXXX
------------------------------------------
Tier B XXXXXX XXXXXX XXXXXX
------------------------------------------
Tier C XXXXXX XXXXXX XXXXXX
==========================================
(ii) Base Rates - NonDay
==========================================
Tier A Tier B Tier C
------------------------------------------
Tier A XXXXXX XXXXXX XXXXXX
------------------------------------------
Tier B XXXXXX XXXXXX XXXXXX
------------------------------------------
Tier C XXXXXX XXXXXX XXXXXX
==========================================
With respect to calls from the continental United States to Alaska, Hawaii,
Puerto Rico, and the United States Virgin Islands ("Non-Mainland"), or to
an International location, the Domestic Transport Charge will be comprised
of the applicable originating Tier Charge and the terminating Tier Charge
which will be deemed to be Tier A. With respect to 800 calls (and 1+ calls
from Hawaii only) from a Non-Mainland location to the continental United
States, the Domestic Transport Charge will be comprised of the originating
Tier Charge which will be deemed to be Tier A and the applicable
terminating Tier Charge.
(3) The Tier Charges for Carrier TERMINATION Service calls (regardless of
jurisdiction or time of day) within the continental United States or from
the continental United States to an International location are shown below.
The Domestic Transport Charge will be comprised of the applicable Tier
Charge based on the Tier to which the call is terminated.
2/25/96 Page 2 of 16 CONFIDENTIAL
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<PAGE>
Tier A XXXXXXX
Tier B XXXXXXX
Tier C XXXXXXX
(4) The Tier Charges for Carrier 800 ORIGINATION Service calls (regardless
of jurisdiction or time of day) within the continental United States are
shown below. The Domestic Transport Charge will be comprised of the
applicable Tier Charge based on the Tier from which the call is originated.
Tier A XXXXXXX
Tier B XXXXXXX
Tier C XXXXXXX
(5) With respect to Directory Assistance calls within the continental
United States and to Canada, the Domestic Transport Charge will be
comprised of the applicable originating Tier Charge and the terminating
Tier Charge which will be deemed to be Tier A.
(B) NON-MAINLAND TRANSPORT CHARGES
(1) With respect to calls originating in the continental United States and
terminating to a Non-Mainland location, the following "Non-Mainland
Transport Charges" will apply in addition to any applicable Domestic
Transport Charge as described in Subsection 2(A) above:
Non-Mainland Location Non-Mainland Transport Charge
--------------------- -----------------------------
Alaska XXXXXXX
Hawaii XXXXXXX
Puerto Rico XXXXXXX
US Virgin Islands XXXXXXX
(2) With respect to 800 calls (and 1+ calls from Hawaii only) originating from
a Non-Mainland locatin and terminating to the continental United States, the
following Non-Mainland Transport Charges will apply in addition to any
applicable Domestic Transport Charge as described in Subsection 2(A) above:
None-Mainland Location Non-Mainland Transport Charge
---------------------- -----------------------------
Alaska XXXXXXX
Hawaii XXXXXXX
Puerto Rico XXXXXXX
US Virgin Islands XXXXXXX
(C) INTERNATIONAL TRANSPORT CHARGES.
Commencing with the Effective Date described in Section 1 above, with
respect to calls originating in the continental United States and
terminating to an International location (i.e., other than a non-Mainland
location), the "International Transport Charge" will be deemed to
correspond with the $1mm Int'l Monthly Revenue Level shown on Schedule "2"
attached hereto and incorporated herein by reference.
(D) LEC CHARGES
(1) "LEC Charges" include Access Charges, Egress Charges and SMS 800
queries. "Access Charges" and "Egress Charges" are per minute
2/25/96 Page 3 of 16 CONFIDENTIAL
------------
<PAGE>
costs reasonably calculated by WilTel in accordance with this Agreement between
the applicable WilTel point of presence and the terminating or originating
point, and rated at the applicable end office (NPA-NXX) level using switched
tandem access rates and charges (excluding TRAVEL CARD Service). Directory
Assistance calls will only be assessed the applicable Access Charge. Customer
will also pay WilTel a XXXXXXXXXXXXXXXX administrative charge which is assessed
on the total of Customer's monthly LEC Charges. The NPA-NXX is generally
identified by the end user's automated number identification ("ANI"); provided,
however, in the event there is not an identified originating ANI reasonably
attributable to Customer, the NPA-NXX will be assigned based on WilTel's
originating trunk group. The terminating NPA-NXX will be identified by the
dialed number; provided, however, in the event there is not an identified
dialed number, the NPA-NXX will be assigned based on WilTel's terminating trunk
group.
(2) The per minute rates utilized by WilTel in calculating the applicable
Access Charges and Egress Charges are described in the local exchange carrier's
("LECs") applicable tariffs and are exclusive of any discounts based on minute
or term commitments. In the event the LECs provide discounts which Customer
would receive based solely on its own traffic, and such discounts have a
material effect on Customer's total charges for Services provided hereunder,
WilTel and Customer agree to negotiate in good faith concerning the calculation
of all LEC charges to reflect the charges Customer would pay based solely on
Customer's usage. The Access Charges and Egress Charges may include, without
limitation the components and elements described below; provided, however, the
terminology with respect to these components and elements may vary among LECs.
The Access Charges and Egress Charges will be calculated taking into effect
whether the call is interstate, intrastate or intraLATA, the direction of the
call (i.e., whether originating or terminating), whether the call is premium or
nonpremium (if applicable), the mileage, the meet point (if applicable) and the
call type (i.e., 1+ or 800). WilTel may also apply any other rating elements
which are assessed by the LECs or third parties (e.g., regulatory fee
assessments or non-standard LEC access components) whether such charges are
based per access line, per business line, per market share, per call, etc.
(e.g., the Arkansas Carrier Common Line charge which is assessed by a
regulatory body and allocated to the LECs) (collectively, the "Other Charges").
Upon reasonable request by Customer, WilTel agrees to substantiate how WilTel
calculated the cost per minute with respect to the Other Charges. With respect
to those LECs utilizing a "time of day" differential (i.e., Day/Nonday, Day/
Evening/Night, etc.), WilTel will only use the "Day" rate provided by the LECs.
Component Elements
------------------- ---------------------
Carrier Common Line Originating
Terminating
End Office Local Switching
Equal Access Recovery
Information Surcharge
2/25/96 Page 4 of 16 CONFIDENTIAL
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<PAGE>
Local Transport Termination
Tandem Switching
Facility
Interconnection
Entrance Facility DS-3 (month-to-month electrical)
Multiplexer (3/1 month-to-month)
(3) The Access Charges and Egress Charges are generally applied on a per
minute basis except for (i) the Local Transport Facility charge which is
based on minutes and mileage, and (ii) the Entrance Facility rate and
Multiplexer rate which are flat monthly rates which are converted by WilTel
to a cost per minute basis by dividing the applicable DS-3 flat rate or the
multiplexer rate as found in the applicable LEC tariff by XXXXXXXXX. WilTel
reserves the right to convert any other flat rates assessed by the LECs
into per minute charges. Any per minute charges determined hereunder will
be added to the applicable Access Charges and Egress Charges. Upon thirty
(30) days' prior written notice, WilTel may also charge Customer for other
charges it is assessed by any LEC or the SMS 800 database administrator for
800 number service (e.g., National Exchange Carrier Association (NECA)
charges, etc.), excluding any charges incurred by WilTel solely for the
purpose of maintaining its network.
Example: Assume the applicable LEC tariffed rate (i) for entrance facility
charges is XXXXXX per DS-3, and (ii) for muxing is XXXXXXXXXXXX mux. The
Entrance Facility rate will be XXXXXXXXXXXXXXXXXXXXXXXXXXXXX and the
Multiplexer rate will be XXXXXXXXXXXXXXXXXXXXXXXXXXX.
(4) Access Charges will commence when the call is originated and will end
when the call is disconnected. Customer will be assessed Access Charges
even if a call is not completed. Egress Charges will commence when the call
is answered and will end when the call is disconnected. Access Charges and
Egress Charges will not apply with respect to dedicated access originations
or terminations, respectively.
(E) TRANSCEND(TM) MANAGER.
WilTel agrees to provide Customer, at no cost to Customer, a windows-based
software program entitled "Transcend(TM) Manager" which will include, among
other things, the Transcend(TM) Database (as described herein) and various
management reports. The "Transcend(TM) Database" will contain the
applicable Access Charges and Egress Charges reasonably calculated by
WilTel in accordance with this Agreement at each LEC end office. The
Database will be updated periodically to take into account any tariff
changes by the various LECs ("Tariff Changes"). Tariff Changes received by
WilTel on or before the fifteenth (15th) day of a month and effective as of
the first day of the following month or thereafter, will be incorporated
into the Transcend(TM) Database by the first day of the month following
WilTel's receipt thereof or the date such Tariff Changes are effective,
whichever is later.
(F) DIRECTORY ASSISTANCE SURCHARGE:
Directory assistance calls in the continental United States will be
assessed a surcharge of XXXXXX in addition to any applicable Domestic
Transport Charge as described in Subsection 2(A)(2) above plus applicable
LEC Charges. Directory assistance calls to Canada
2/25/96 Page 5 of 16 CONFIDENTIAL
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<PAGE>
will be assessed a surcharge of XXXXXXX in addition to any applicable
Domestic Transport Charge as described in Subsection 2(A) above and the
applicable Non-Mainland Transport Charge as described in Subsection
2(B) above.
(G) TRAVEL CARD SERVICE RATES:
(1) Basic Interstate TRAVEL CARD Service Rates Per Minute: XXXXXX
Day, XXXXXX Nonday.
(2) Basic Intrastate TRAVEL CARD Service Rates Per Minute [NOT SUBJECT
TO DISCOUNT]: SEE ATTACHED INTRASTATE SWITCHED ACCESS RATE SCHEDULE FOR
BASIC TRAVEL CARD SERVICE.
(3) International TRAVEL CARD Service Rates Per Minute [NOT SUBJECT TO
DISCOUNT]: SEE ATTACHED INTERNATIONAL SWITCHED ACCESS RATE SCHEDULE FOR
BASIC TRAVEL CARD SERVICE. International TRAVEL CARD Service calls from
the domestic United States to International locations (other than
Canada) are subject to a surcharge of XXXX per call.
(4) TRAVEL CARD Service Rates Per Minute from the domestic United
States to Canada [NOT SUBJECT TO DISCOUNT]: XXXXXXX XXXX, XXXXXXX
Nonday. TRAVEL CARD Service calls from the domestic United States to
Canada are subject to a surcharge of XXXX per call.
(5) TRAVEL CARD Service Rates Per Minute from Canada to the domestic
United States [NOT SUBJECT TO DISCOUNT]: XXXXXXX Day, XXXXXXX Nonday.
TRAVEL CARD Service calls from Canada to the domestic United States are
subject to a surcharge of XXXX per call.
(6) Enhanced TRAVEL CARD Service Pricing [NOT SUBJECT TO DISCOUNT]:
Enhanced features to the TRAVEL CARD Service are available as
described in the attached schedule for Enhanced TRAVEL CARD Service
Pricing.
(7) TRAVEL CARD Service Discount: XXXXXXXXXXXXXXXXXXXXX.
3. DISCOUNTS:
(A) For purposes of this Agreement, Customer "Monthly Revenue Level" will
be comprised of Customer's gross (i.e., prior to the application of any
discounts) (i) Transport Charges (i.e., Domestic, Non-Mainland and
International); (ii) LEC charges (including Other Charges); (iii) Directory
Assistance surcharges; (iv) TRAVEL CARD Service charges; (v) the
Administrative Fee described in Subsection 2(D)(1) above; (vi) XXXXXXXXX
times Customer's first XXXXXXXX of monthly recurring private line
interexchange service charges (including both domestic and international)
from WilTel; (vii) XXXXXXX times Customer's second XXXXXXXX of monthly
recurring private line interexchange service charges (including both
domestic and international) from WilTel; and, (viii) Customer's monthly
recurring private line interexchange service charges (including both
domestic and international) from WilTel in excess of XXXXXXXX. Customer's
Monthly Revenue Level will not include any pro rata charges, ancillary or
special feature charges, such as, Authorization codes or CDR Tapes, or any
other charges other than those identified by the relevant WilTel invoice as
monthly recurring private line interexchange service charges or the switched
service charges specifically mentioned in this Subsection (A).
2/25/96 Page 6 of 16 CONFIDENTIAL
<PAGE>
(B) Commencing with the Effective Date and continuing through the end of the
Service Term (the "Commitment Period"), Customer will receive the applicable
discount percentages (the "Discount") as shown in Subsections (C), (D), (E)
and (F) below. The Discount will only be applied to Customer's Domestic
Transport Charges as described in Subsection 2(A) above and Customer's Non-
Mainland Transport Charges to Non-Mainland locations (excluding Canada).
(C) TERMINATION Service: XXXXXXXXXXXXXXXXXXXXXXX.
(D) 800 ORIGINATION Service: XXXXXXXXXXXXXXXXXXXXXXXXX.
(E) SWITCHED ACCESS Service and DEDICATED ACCESS Service to Non-Mainland
locations only (excluding Canada): XXXXXXXXXXXXXXXXXXXXXXXXX.
(F) SWITCHED ACCESS Service and DEDICATED ACCESS Service (1+ and 800) within
the continental United States: XXXXXXXXXXXXXXXXXXXXXXX.
(G) During the Service Term of the Agreement, accumulated credits derived
from the applicable Discounts will be applied in arrears commencing with the
first day of the month following the Effective Date, that is, the Discount
will be applied to those charges as described in Subsection 3(B) above for
the preceding month (the "Discount Period"). The initial Discount Period
shall include any partial calendar month following Start of Service, or such
other time basis as may be mutually determined by the parties.
(H) Each Discount will result in the application of a credit obtained during
the Discount Period to the WilTel invoice to Customer relevant to the billed
measured Services under this Agreement for the calendar month next following
the completion of each Discount Period, provided Customer has paid
--------
undisputed charges (including any late fees, if applicable) for that month
in accordance with this Agreement and is not otherwise subject to a
Suspension Notice in accordance with this Agreement. Failure of Customer to
comply with the foregoing provision shall result in no credit for the
Discount Period in question.
4. CUSTOMER'S COMMITMENT/DEFICIENCY CHARGE:
(A) Commencing with the Effective Date and continuing through the end of the
Service Term (the "Commitment Period"), Customer agrees to maintain, on a
take-or-pay basis, in the aggregate a Monthly Revenue Level (as defined in
Subsection 3(A) above) of at least the amounts shown below by the end of the
periods shown determined on a cumulative basis (collectively, "Customer's
Cumulative Commitment").
<TABLE>
<CAPTION>
Period Customer's Cumulative Commitment
--------------- --------------------------------
<S> <C>
End of Month 12 $150,000,000
End of Month 18 $300,000,000
End of Month 24 $450,000,000
End of Month 30 $600,000,000
End of Month 36 $750,000,000
End of Month 42 $900,000,000
</TABLE>
(B) In the event Customer does not achieve Customer's applicable Cumulative
Commitment by the end of the respective Month listed Customer will pay
WilTel XXXXXXXXXXXXXXXXXXX of the difference between Customer's applicable
Cumulative Commitment and Customer's actual cumulative Monthly Revenue Level
(as described in Subsection 3(A) above) determined on a cumulative basis as
of the end of such Month (the "Deficiency
2/25/96 Page 7 of 16 CONFIDENTIAL
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<PAGE>
Charge"). Provided, however, Customer may elect one (1) time during the
Commitment Period to transfer up to $15,000,000 of any Deficiency Charge to
the immediately following period in which case the applicable Cumulative
Commitment for said period will be deemed to included the transferred
Deficiency Charge amount. The Deficiency Charge will be due at the same time
payment is due for Service provided to Customer, or immediately in an amount
equal to $900,000,000 less Customer's actual cumulative Monthly Revenue
Level if WilTel terminates the Agreement based on Customer' default.
5. OTHER AGREEMENTS: In consideration of the rates and discounts offered
hereunder to Customer as well as the unique and special pricing elements,
Customer acknowledges and agrees that this Agreement and the Services
described herein may not be combined with any other products or services
offered by WilTel, WilTel's parent company or WilTel's affiliates.
Therefore, Customer acknowledges and agrees that:
(A) As of the Effective Date of this Agreement, (i) all switched
telecommunications services ("Existing Services") offered by WilTel (formerly
WilTel, Inc.), WilTel's parent company, WorldCom, Inc. (formerly LDDS
Communications, Inc.) or any of WilTel's affiliates, including without
limitation, IDB WorldCom Services, Inc. (hereinafter referred to as the
"WilTel Group"), which are currently being provided Customer (which for
purposes of this Section 5 will include Customer's parent company, Customer's
subsidiaries and any other entities under common control with Customer;
hereinafter referred to as the "Customer Group") pursuant to existing service
agreements ("Existing Agreements") will be canceled and no longer in force or
effect except for charges or credits due for Existing Services rendered as of
the Effective Date of this Agreement and provisions intended to survive
termination, such as limitation of liability, indemnification and
confidentiality, and (ii) all Existing Services provided a member of the
Customer Group by a member of the WilTel Group will be provisioned under the
terms and conditions of this Agreement. Simultaneous with the execution of
this Agreement, if applicable, Customer shall cause all members of the
Customer Group to agree to the cancellation of such Existing Agreements and
the provision of Existing Services under the terms and conditions of this
Agreement and Customer agrees to provide WilTel with reasonable documentation
evidencing such agreement.
(B) If Customer acquires a third party after the Effective Date of this
Agreement, and such third party has existing agreement(s) with a member of
the WilTel Group (collectively referred to as the "Existing Agreements") for
the provision of switched telecommunications services ("Existing Services"),
then ninety (90) days following the date of the closing of such acquisition,
merger or combination (or such earlier date contained in a written notice
from Customer to WilTel) (the "Transfer Date"), (i) the Existing Agreements
will be canceled and no longer in force or effect except for commitments, if
any, contained in such Existing Agreements and charges and credits due for
Services rendered prior to the Transfer Date, (ii) Existing Services will be
provisioned under this Agreement, and (iii) the aggregate commitment(s)
(e.g., revenue, volume, minute, etc.) remaining under such Existing
Agreements, if any, shall be added on a pro rata basis to the commitment(s),
if any, existing under this Agreement. Simultaneous with the closing of such
acquisition, combination or merger, Customer will cause such third party and
all of its affiliates who are parties to such Existing Agreements, to agree
to the cancellation of such Existing Agreements and the provision of Existing
Services under the terms and conditions of this Agreement and Customer agrees
to provide WilTel with reasonable documentation evidencing such agreement.
2/25/96 Page 8 of 16 CONFIDENTIAL
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<PAGE>
Example: Assume (i) Customer's Commitment as described in Subsection 4(A)
above is $500,000, (ii) there are twenty-four (24) months remaining in the
Service Term of this Agreement, and (iii) Customer acquires a third party who
has an existing switched telecommunications services agreement with a member
of the WilTel Group which contains a minimum monthly revenue commitment of
$250,000 and has ten (10) months remaining in the term of such agreement.
Customer's "new" Commitment as described in Subsection 4(A) will be $604,166
for the remaining twenty-four (24) months in the Service Term determined as
follows:
$500,000 + [($250,000 x 10)/24] = $500,000 + $2,500,000/24 =
$500,000 + 104,166 = $604,166.
(C) If Customer merges or combines with a third party after the Effective
Date of this Agreement, and such third party has existing agreement(s) with a
member of the WilTel Group (collectively referred to as the "Other Existing
Agreements") for the provision of switched telecommunications services
("Other Existing Services"), then within ninety (90) days following the date
of the closing of such merger or combination (or such earlier date contained
in a written notice from Customer to WilTel) (the "Other Transfer Date"),
Customer must elect to either (i) cancel this Agreement, or (ii) cancel the
Other Existing Agreements (hereinafter referred to as the "Canceled
Agreement"). In such case, charges and credits due for Services rendered
under the Canceled Agreement prior to the Other Transfer Date will remain in
full force and effect, (ii) Other Existing Services under the Canceled
Agreement will be provisioned under the surviving Agreement, and (iii) the
aggregate commitment(s) (e.g., revenue, volume, minute, etc.) remaining under
the Canceled Agreement, if any, shall be added on a pro rata basis to the
commitment(s), if any, existing under the surviving Agreement. Simultaneous
with the closing of such combination or merger, if necessary, Customer will
cause such third party and all of its affiliates who are parties to such
Other Existing Agreements, to agree to the cancellation of such Other
Existing Agreements and the provision of Other Existing Services under the
terms and conditions of the surviving Agreement and Customer agrees to
provide WilTel with reasonable documentation evidencing such agreement.
(D) If any member of the WilTel Group acquires, merges or combines with a
carrier with which Customer has a reseller agreement ("Other Carrier
Agreement"), Customer may elect to transition all services being provided
under the Other Carrier Agreement to this Agreement. Provided, in such case
any remaining commitment(s) under the Other Carrier Agreement, if any, shall
be added on a pro rata basis to the commitment(s), if any, existing under
this Agreement.
6. PIC PROCESS: As long as Customer is directly effecting the change of its End
Users' primary interexchange carrier ("PIC Process"), all provisions (or
portions thereof) concerning such PIC Process (including without limitation,
Subsections 1(E), 2(C), 3(A), 3(B), 3(C) and 3(D)) will not apply. Provided,
however, if at any time during the Initial Service Term or any Renewal Period
Customer requests WilTel to perform such PIC Process, in whole or in part,
such provisions (or portions thereof) shall be applicable.
7. SERVICE REQUESTS: The parties agree to substitute Subsection 1(E) of the TSA
and add Subsection 1(F) of the TSA to read in their entirety as follows:
(E) Service Requests Customer's requests to initiate or cancel Services
----------------
shall be described in an appropriate WilTel Service Request ("Service
Requests"). Service Requests may consist of machine readable tapes,
facsimiles or other means approved by WilTel. Further, Service Requests
shall specify all reasonable information, as determined by
2/25/96 Page 9 of 16 CONFIDENTIAL
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<PAGE>
WilTel, necessary or appropriate for WilTel to provide the Service(s) in
question, which shall include without limitation, the type, quantity and end
point(s) (when necessary) of circuits comprising a Service Interconnection as
described in the applicable Service Schedules, or automatic number
identification ("ANI") information relevant to the Service(s), the Requested
Service Date, and charges, if any, relevant to the Services described in the
Service Request. After WilTel's receipt and verification of a valid Service
Request for SWITCHED Service (as defined in the Service Schedule) requiring a
change in the primary interexchange carrier ("PIC"), WilTel agrees to (i)
submit the ANI(s) relevant to such Service Requests to the following local
exchange carriers ("LECs") (with which WilTel currently has electronic
interface capabilities) within ten (10) days: Ameritech, Bell Atlantic,
BellSouth, Nynex, Pacific Bell, Southwestern Bell, US West, GTE and United,
and (ii) submit the ANI(s) relevant to such Service Requests to those LECs
with which WilTel does not have electronic interface capabilities within a
reasonable time.
(F) WilTel is able to collect, partition and duplicate at least 4,000,000
billable call detail records ("CDRs") for Customer per day. WilTel agrees to
archive such CDRs for a period of eighteen (18) months. WilTel acknowledges
that calls associated with ANIs which are not identified in WilTel's database
are identified as "Casual Calls" and are billed by WilTel after fourteen (14)
days. Upon submission by Customer of an ANI for processing, WilTel agrees to
provide Customer with call detail record information associated with such ANI
which has not been previously billed by WilTel.
8. CANCELLATION WITHOUT CHARGE: The parties agree to substitute Subsection 2(C)
---------------------------
of the TSA to read in its entirety as follows:
(C) Cancellation Without Charge Notwithstanding anything to the contrary
contained in Subsection 2(A) above, Customer may cancel this Agreement
without incurring any cancellation charge if WilTel materially breaches any
of the warranties described below within the time frame described or, if
applicable, fails to cure such breach within any applicable cure period
("WilTel Breaches"). Provided, however, with respect to WilTel Breaches
described in Subparts (i), (iv) or (v), Customer must give WilTel written
notice of such default and an opportunity to cure such default within five
(5) days of such notice. In the event WilTel fails to cure any such default
within the five-day period on more than three (3) occasions within any six
(6) month period, WilTel will be deemed in breach of this Agreement and
Customer may cancel this Agreement without incurring any cancellation charge.
(i) WilTel agrees to materially provide a long distance network with
transmission quality and availability consistent with telecommunications
common carrier industry standards, government regulations and sound
business practices. In the event of a cable cut or other incident
materially affecting WilTel's network, WilTel agrees to use reasonable
efforts to notify Customer within thirty (30) minutes; provided,
however, WilTel's failure to notify Customer will not be deemed a breach
of this Agreement by WilTel.
(ii) When measured over a thirty (30) day period, WilTel agrees to
materially deliver call detail records within (x) twenty-four (24) hours
of each day's traffic at least seventy-five percent (75%) of the time,
(y) forty-eight (48) hours at least ninety-five percent (95%) of the
time, and (z) seventy-two (72) hours ninety-eight percent (98%) of the
time (collectively, the "Delivery Standard"). In the event WilTel fails
to materially
2/25/96 Page 10 of 16 CONFIDENTIAL
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<PAGE>
deliver call detail records within the Delivery Standard on more than
three (3) occasions within any twelve (12) month period, WilTel will be
deemed to be in breach of this Agreement and Customer may cancel this
Agreement without incurring any cancellation charge.
(iii) WilTel agrees to materially process (x) SWITCHED ACCESS Service
(1+) Service Requests within twenty-four (24) hours of receipt of such
Service Requests, and (y) DEDICATED ACCESS Service (800) Service
Requests within five days (excluding Sundays and nationally recognized
holidays) of receipt of such Service Requests, and (z) within seventy-
two (72) hours of receipt of such Service Requests in cases where
Customer's Responsible Organization (RESPORG) provides the 800 number
(collectively, the "Process Standard"). In the WilTel fails to
materially process Service Requests within the Process Standard on more
than three (3) occasions within any thirty (30) day period, WilTel will
be deemed to be in breach of this Agreement and Customer may cancel this
Agreement without incurring any cancellation charge.
(iv) WilTel agrees that its network will be engineered so that no more
than one call in one hundred originating calls will be blocked during
any hour. WilTel agrees to relieve blockage conditions by means of
rerouting terminating traffic to an off-network provider within twenty-
four (24) hours from the time such blockage occurs.
(v) WilTel agrees to monitor its network twenty-four (24) hours per
day, seven (7) days a week and agrees to act on problems materially
effecting transmission service within four (4) hours from the time
Customer notifies WilTel of a problem or WilTel identifies a problem. In
the event Customer submits a "trouble ticket" identifying specific
trouble items, Customer will have the ability to ascertain the status of
such trouble ticket and must give approval before said trouble ticket is
closed.
(vi) WilTel agrees that WilTel's administrative systems specifically
relating to CDRs and the processing of ANIs under this Agreement will be
available at least ninety-eight percent (98%) of the time when measured
over a thirty (30) day period (excluding downtime every twenty-four (24)
hours between 10:00 p.m. and 7:00 a.m., other scheduled downtimes
mutually agreeable to both parties, and downtime for new load
implementation, backups, maintenance and unplanned outages) ("WilTel's
Systems Availability"). In the event WilTel's System Availability is
less than allowed hereunder (hereinafter referred to as a "System
Breach"), Customer agree to notify WilTel and WilTel agrees to notify
Customer within forty-eight (48) hours after receiving Customer's notice
that the underlying problem has been corrected ("Systems Cure Period").
Following WilTel's notice, WilTel's System Availability will not be
lower than ninety-eight percent (98%) when measured over the following
7, 14, 21 and 30 day periods thereafter. In the event a System Breach
is not cured within the Systems Cure Period (or after such Systems Cure
Period occurs again within the 7, 14, 21 or 30 day period thereafter),
on more than three (3) occasions within any twelve (12) month period,
WilTel will be deemed to be in breach of this Agreement and Customer may
cancel this Agreement without incurring any cancellation charge.
2/25/96 Page 11 of 16 CONFIDENTIAL
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<PAGE>
9. FRAUDULENT CALLS: The parties agree to substitute Subsection 4(B) of the TSA
to read in its entirety as follows:
(B) Fraudulent Calls WilTel agrees to apply the same level of effort and
----------------
utilize the same methods and procedures to control long distance fraud for
Customer's long distance traffic carried over the WilTel network that any
member of the WilTel Group (as defined in Section 5 of the PET) does for its
own traffic. WilTel agrees to diligently pursue the detection and
elimination of fraud utilizing, but not limited to, the detection/screening
parameters, and methods listed below. The parties understand that there may
be as much as three (3) hours between a fraud event and WilTel's detection
thereof and that there may be occurrences of fraud which, regardless of
WilTel's diligent efforts, may go undetected. All call records selected for
fraud screening using the parameters stated below are subject to fraud
analyst's review, judgment, and discretion as to a decision whether fraud is
actually occurring. Except to the extent WilTel fails to comply with the
fraud control provisions set forth below through no fault of Customer, (i)
Customer shall indemnify and hold WilTel harmless from all costs, expenses
(including, without limitation, court costs and attorneys' fees), losses,
damages, liabilities, demands, charges, penalties, claims or actions arising
from fraudulent or unauthorized calls of any nature which may comprise a
portion of the Services; and (ii) Customer shall not be excused from paying
WilTel for Services provided to Customer or any portion thereof on the basis
that fraudulent or unauthorized calls comprised a corresponding portion of
the Services. Provided, however, WilTel agrees to reasonably seek
forgiveness of payments to the extent possible from countries (such as Guyana
and the Dominican Republic) where foreign telephone companies have agreed to
forego payments for disputed calls (in the event WilTel does not reasonably
seek such forgiveness, WilTel agrees to be liable for such disputed calls).
In the event WilTel discovers fraudulent or unauthorized calls being made (or
reasonably believes fraudulent or unauthorized calls are being made), WilTel
shall take action with prompt, subsequent notice that is reasonably necessary
to prevent such fraudulent or unauthorized calls from continuing to take
place, including without limitation, denying Services to particular ANIs or
terminating Services to or from specific locations.
(i) Call records with invalid authorization codes.
(ii) Call records with invalid PIN digits.
(iii) Toll-free call records that are pay phone with a duration
greater than 3600 seconds.
(iv) Toll-free call records with a duration greater than 3600
seconds.
(v) Caribbean calls records that are Dominican and have a duration
greater that 3600 seconds.
(vi) Call records that are domestic (not international) and are not
toll-free and have a duration greater than 4000 seconds.
(vii) International call records with a duration greater than 3600
seconds.
(viii) Call records with universal access numbers for travel card
services.
2/25/96 Page 12 of 16 CONFIDENTIAL
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<PAGE>
(ix) Calls from ANI or authcode with a duration greater than 4000
seconds.
(x) Calls with non-zero information digits.
(xi) International calls with an authcode on a FGB, or authcodes on
FGD if there are more than ten (10) calls within one (1) hour
or with a duration greater than 300 minutes.
(xii) Call records made with an authcode on FGB to area code 809, or
authcodes that are on FGD if there are more than ten (10)
calls within one (1) hour or with duration greater than 300
minutes.
(xiii) Originating ANI with more than ten (10) calls totaling more
than 600 minutes.
(xiv) WilTel acknowledges that it is capable of providing the
following information upon reasonable request by Customer: (w)
three (3) threshold alert levels mutually agreed to by the
parties, (x) the number of calls from a specific originating
ANI, destination number, international country code and billing
number, (y) the number of billable minutes from a specific
originating ANI, destination number, international country code
and billing number, and (z) Customer's capability to block and
update the number database with respect to a specific ANI,
destination number, international country code or billing
number.
10. BILLING DISPUTES: The parties agree to substitute Subsections 5(A), 5(D)
and 5(E) of the TSA to read in their entirety as follows:
(A) Payment WilTel billings for Services hereunder are made on a monthly
-------
basis (or such other basis as may be mutually agreed to by the parties)
following Start of Service. WilTel agrees to provide monthly summary billing
and invoicing information with identified originating and terminating LATAs
in order to allow Customer to reconcile its monthly CDR billing records with
CDRs delivered to Customer for such period. Subject to Subsection 5(D)
below, Services shall be billed at the rates set forth in the PET and
Service Requests, as the case may be. Discounts, if any, applicable to the
rates for certain Services are set forth in the PET. Customer will pay all
undisputed charges relative to each WilTel invoice for Services within forty
-five (45) days of the invoice date set forth on each WilTel invoice to
Customer ("Due Date"). If payment is not received by WilTel on or before the
Due Date, Customer shall also pay a late fee in the amount of the lesser of
one and one-half percent (1 1/2%) of the unpaid balance of the charges for
Services rendered per month or the maximum lawful rate under applicable
state law.
(D) Modification of Charges During the Service Term of this Agreement, the
-----------------------
Domestic Transport Charges (as described in Subsection 2(A) of the PET) and
the administrative charge (as described in Subsection 2(D) of the PET) will
not be modified by WilTel. International Transport Charges may be modified
based on Wiltel's cost for such service.
(E) Billing Disputes Notwithstanding the foregoing, late fees shall apply
----------------
(but shall not be due and payable for a period of one hundred and twenty
(120) following the Due Date therefor) for amounts reasonably
2/25/96 Page 13 of 16 CONFIDENTIAL
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<PAGE>
disputed by Customer, provided Customer: (i) pays all undisputed charges on
or before the Due Date, (ii) presents a written statement of any billing
discrepancies to WilTel in reasonable detail on or before the Due Date of
the invoice in question, and (iii) negotiates in good faith with WilTel for
the purpose of resolving such dispute within said one hundred and twenty
(120) day period. In the event such dispute is resolved in favor of WilTel,
Customer agrees to pay WilTel the disputed amounts together with any
applicable late fees within ten (10) days of the resolution. In the event
such dispute is resolved in favor of Customer, Customer will receive a
credit for the disputed charges in question and the applicable late fees. In
the event the dispute can not be resolved within such one hundred and twenty
(120) day period (unless WilTel has agreed in writing to extend such period)
all disputed amounts together with late fees shall become due and payable,
and this provision shall not be construed to prevent Customer from pursuing
any available legal remedies. WilTel shall not be obligated to consider any
Customer notice of billing discrepancies which are received by WilTel more
than one hundred and twenty (120) days following the Due Date of the invoice
in question.
11. CREDIT: The parties agree to substitute Section 6 of the TSA to read in its
------
entirety as follows:
Credit: Customer has received credit approval from WilTel as described in
------
that certain letter dated ____________, a copy of which is attached hereto
as Attachment "1" (the "Credit Letter"). Provided Customer's accounts
receivable balance to WilTel does not exceed $50,000,000 ("Customer's Credit
Line"), WilTel will not require any further security or assurances from
WilTel for payments due hereunder. WilTel reserves the right, however, to
require additional security or other assurances from Customer with respect
to payments due hereunder in the event Customer's Credit Line exceeds
[$50,000,000.]
12. CREDITWORTHINESS: The parties agree to substitute Section 7 of the TSA to
----------------
read in its entirety as follows:
Creditworthiness: During the Initial Service Term (including any Renewal
----------------
Periods) Customer agrees to provide WilTel with quarterly financial
statements. If at any time there is a material adverse change as
specifically defined herein, then in addition to any other remedies
available to WilTel, WilTel may elect, in its sole discretion, to exercise
one or more of the following remedies: (i) cause Start of Service for
Services described in a previously executed Service Request to be withheld;
(ii) cease providing Services pursuant to a Suspension Notice in accordance
with Section 5(F); (iii) decline to accept a Service Request or other
requests from Customer to provide Services which WilTel may otherwise be
obligated to accept and/or (iv) condition its provision of Services or
acceptance of a Service Request on Customer's assurance of payment which
shall be a deposit or such other means to establish reasonable assurance of
payment. One or more of the following will constitute a material adverse
change: (i) Customer's material default of its obligations to WilTel under
this or any other agreement with WilTel which is not cured within any
applicable cure period; (ii) failure of Customer to make full payment of all
undisputed charges due hereunder on or before the Due Date on three (3) or
more occasions during any period of twelve (12) or fewer months; (iii)
acquisition of Customer (whether in whole or by majority or controlling
interest) by an entity which is insolvent, which is subject to bankruptcy or
insolvency proceedings, or which owes past due amounts to WilTel or any
entity affiliated with WilTel; or, (iv) Customer's being subject to or
having filed for bankruptcy or insolvency
2/25/96 Page 14 of 16 CONFIDENTIAL
------------
<PAGE>
proceedings or the legal insolvency of Customer.
13. REMEDIES: The parties agree to substitute Section 8 of the TSA to read in
--------
its entirety as follows:
In the event Customer is in material breach of this Agreement, including
without limitation, failure to pay all undisputed charges due hereunder by
the applicable Due Date or the date stated in the Suspension Notice
described in Subsection 5(F) above, provided WilTel has issued Customer at
least two (2) 10-day Suspension Notices as described in Subsection 5(F)
above, WilTel shall have the right, after giving Customer five (5) days
prior notice and opportunity to cure, to (i) terminate this Agreement; (ii)
withhold billing information from Customer; and/or (iii) contact the End
Users (for whom calls are originated and terminated solely over facilities
comprising the WilTel network) directly and bill such End Users directly
until such time as WilTel has been paid in full for the amount owed by
Customer. If Customer fails to make payment by the date stated in the
Suspension Notice and WilTel, after giving Customer five (5) days prior
notice, terminates this Agreement as provided in this Section 8, such
termination shall not relieve Customer for payment of applicable
cancellation charges as described in Section 2 above.
14. WARRANTY: The parties agree to substitute Section 9 of the TSA to read in
--------
its entirety as follows:
Warranty. WilTel will provide a long distance network with transmission
quality and availability consistent with telecommunications common carrier
industry standards, government regulations and sound business practices.
WILTEL MAKES NO OTHER WARRANTIES ABOUT THE SERVICES PROVIDED HEREUNDER,
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.
15. FORCE MAJEURE: The parties agree to substitute Section 11 of the TSA to
-------------
read in its entirety as follows:
Force Majeure. If WilTel's performance of this Agreement or any obligation
-------------
hereunder is prevented, restricted or interfered with by causes beyond its
reasonable control including, but not limited to, acts of God, fire,
explosion, vandalism, storm or other similar occurrence, any law, order,
regulation, direction, action or request of the United States government, or
state or local governments, or of any department, agency, commission, court,
bureau, corporation or other instrumentality of any one or more such
governments, or of any civil or military authority, or by national
emergency, insurrection, riot, war, strike, lockout or work stoppage or
other labor difficulties (excluding WilTel's labor force and personnel), or
supplier failure, shortage, breach or delay (a "Force Majeure Event"), then
WilTel shall be excused from such performance on a day-to-day basis to the
extent of such restriction or interference. WilTel shall use reasonable
efforts under the circumstances to avoid or remove such causes or
nonperformance and shall proceed to perform with reasonable dispatch
whenever such causes are removed or cease. In the event WilTel is unable to
restore Service within five (5) days after the occurrence of a Force Majeure
Event as described herein, Customer may cancel the affected Service and
WilTel and Customer agree to negotiate in good faith concerning Customer's
minimum monthly commitment, if any, described in the PET.
16. FORUM: The parties agree to substitute Subsection 20 of the TSA to read in
-----
its entirety as follows:
2/25/96 Page 15 of 16 CONFIDENTIAL
------------
<PAGE>
(B) Forum Any legal action or proceeding with respect to this Agreement
-----
may be brought in the Courts of (i) the State of Oklahoma in and for the
County of Tulsa or the United States of America for the Northern District of
Oklahoma or (ii) the State of Texas in and for the County of Dallas or the
United States of America for the Northern District of Texas. By execution of
this Agreement, both Customer and WilTel hereby submit to such jurisdiction,
hereby expressly waiving whatever rights may correspond to either of them by
reason of their present or future domicile. In furtherance of the foregoing,
Customer and WilTel hereby agree to service by U.S. Mail at the notice
addresses referenced in Section 15. Such service shall be deemed effective
upon the earlier of actual receipt or seven (7) days following the date of
posting.
17. ACCOUNTING CODES: Notwithstanding anything to the contrary contained in
----------------
Section 14 of the Service Schedule dated concurrently herewith, WilTel
agrees to XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX for verified or non-
verified accounting codes.
IN WITNESS WHEREOF, the parties have executed these Program Enrollment
Terms on the date first written above.
WORLDCOM NETWORK SERVICES, INC. EXCEL TELECOMMUNICATIONS, INC.
d/b/a WilTel
By: /s/ Charles M. Cole By: /s/ Kenny A. Troutt
-------------------------- --------------------------
(Signature) (Signature)
Charles M. Cole III Kenny A. Troutt
- ----------------------------- -----------------------------
(Print Name) (Print Name)
Vice President, Carrier Sales President and CEO
- ----------------------------- -----------------------------
(Title) (Title)
May 31, 1996 May 31, 1996
- ----------------------------- -----------------------------
(Date) (Date)
2/25/96 Page 16 of 16 CONFIDENTIAL
------------
<PAGE>
Transcend
TIER XXX LOCATIONS
[WILTEL GRAPHIC APPEARS HERE]
<TABLE>
<CAPTION>
- --------------------------------------------------
LATA
Tier Number LATA Name
- --------------------------------------------------
<C> <C> <S>
XXX 126 West Massachusetts MA
- --------------------------------------------------
XXX 128 East Massachusetts MA
- --------------------------------------------------
XXX 132 New York Metro NY
- --------------------------------------------------
XXX 222 Delaware Valley, NJ
- --------------------------------------------------
XXX 224 North Jersey, NJ
- --------------------------------------------------
XXX 228 Philadelphia, PA
- --------------------------------------------------
XXX 234 Pittsburgh, PA
- --------------------------------------------------
XXX 236 Washington DC
- --------------------------------------------------
XXX 238 Baltimore, MD
- --------------------------------------------------
XXX 248 Richmond, VA
- --------------------------------------------------
XXX 320 Cleveland, OH
- --------------------------------------------------
XXX 325 Akron, OH
- --------------------------------------------------
XXX 326 Toledo, OH
- --------------------------------------------------
XXX 330 Evansville, IN
- --------------------------------------------------
XXX 332 South Bend, IN
- --------------------------------------------------
XXX 336 Indianapolis, IN
- --------------------------------------------------
XXX 340 Detroit, MI
- --------------------------------------------------
XXX 358 Chicago, IL
- --------------------------------------------------
XXX 426 Raleigh, NC
- --------------------------------------------------
XXX 434 Columbia, SC
- --------------------------------------------------
XXX 438 Atlanta, GA
- --------------------------------------------------
XXX 440 Savannah, GA
- --------------------------------------------------
XXX 442 Augusta, GA
- --------------------------------------------------
XXX 444 Albany, GA
- --------------------------------------------------
XXX 446 Macon, GA
- --------------------------------------------------
XXX 452 Jacksonville, FL
- --------------------------------------------------
XXX 454 Gainesville, FL
- --------------------------------------------------
XXX 456 Daytona Beach, FL
- --------------------------------------------------
XXX 458 Orlando, FL
- --------------------------------------------------
XXX 460 Southeast FL
- --------------------------------------------------
XXX 470 Nashville, TN
- --------------------------------------------------
XXX 472 Chattanooga, TN
- --------------------------------------------------
XXX 478 Montgomery, AL
- --------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------
LATA
Tier Number LATA Name
- --------------------------------------------------
<C> <C> <S>
XXX 480 Mobile, AL
- --------------------------------------------------
XXX 486 Shreveport, LA
- --------------------------------------------------
XXX 488 Lafayette, LA
- --------------------------------------------------
XXX 490 New Orleans, LA
- --------------------------------------------------
XXX 492 Baton Rouge, LA
- --------------------------------------------------
XXX 520 St. Louis, MO
- --------------------------------------------------
XXX 521 Westphalia, MO
- --------------------------------------------------
XXX 522 Springfield, MO
- --------------------------------------------------
XXX 524 Kansas City, MO
- --------------------------------------------------
XXX 532 Wichita, KS
- --------------------------------------------------
XXX 534 Topeka, KS
- --------------------------------------------------
XXX 536 Oklahoma City, OK
- --------------------------------------------------
XXX 538 Tulsa, OK
- --------------------------------------------------
XXX 552 Dallas, TX
- --------------------------------------------------
XXX 554 Longview, TX
- --------------------------------------------------
XXX 560 Houston, TX
- --------------------------------------------------
XXX 562 Beaumont, TX
- --------------------------------------------------
XXX 628 Minneapolis, MN
- --------------------------------------------------
XXX 632 Des Moines, IA
- --------------------------------------------------
XXX 634 Davenport, IA
- --------------------------------------------------
XXX 635 Cedar Rapids, IA
- --------------------------------------------------
XXX 644 Omaha, NE
- --------------------------------------------------
XXX 652 Idaho ID
- --------------------------------------------------
XXX 656 Denver, CO
- --------------------------------------------------
XXX 660 Utah UT
- --------------------------------------------------
XXX 666 Phoenix, AZ
- --------------------------------------------------
XXX 672 Portland, OR
- --------------------------------------------------
XXX 721 Pahrump, NV
- --------------------------------------------------
XXX 722 San Francisco, CA
- --------------------------------------------------
XXX 730 Los Angeles, CA
- --------------------------------------------------
XXX 920 Hartford, CT
- --------------------------------------------------
XXX 952 Gulf Coast FL
- --------------------------------------------------
XXX 953 Tallahassee, FL
- --------------------------------------------------
</TABLE>
<PAGE>
Transcend
TIER XXX LOCATIONS
[WILTEL GRAPHIC APPEARS HERE]
<TABLE>
<CAPTION>
LATA
Tier Number LATA Name
- --------------------------------------------------
<S> <C> <C>
XXX 122 New Hampshire, NH
- --------------------------------------------------
XXX 133 Poughkeepsie, NY
- --------------------------------------------------
XXX 134 Albany, NY
- --------------------------------------------------
XXX 136 Syracuse, NY
- --------------------------------------------------
XXX 140 Buffalo, NY
- --------------------------------------------------
XXX 220 Atlantic Coastal NJ
- --------------------------------------------------
XXX 246 Culpeper, VA
- --------------------------------------------------
XXX 250 Lynchburg, VA
- --------------------------------------------------
XXX 252 Norfolk, VA
- --------------------------------------------------
XXX 324 Columbus, OH
- --------------------------------------------------
XXX 338 Bloomington, IN
- --------------------------------------------------
XXX 342 Upper Peninsula MI
- --------------------------------------------------
XXX 344 Saginaw, MI
- --------------------------------------------------
XXX 346 Lansing, MI
- --------------------------------------------------
XXX 348 Grand Rapids, MI
- --------------------------------------------------
XXX 350 Northeast WI
- --------------------------------------------------
XXX 352 Northwest WI
- --------------------------------------------------
XXX 354 Southwest WI
- --------------------------------------------------
XXX 356 Southeast WI
- --------------------------------------------------
XXX 366 Forrest, IL
- --------------------------------------------------
XXX 368 Peoria, IL
- --------------------------------------------------
XXX 370 Champaign, IL
- --------------------------------------------------
XXX 374 Springfield, IL
- --------------------------------------------------
XXX 422 Charlotte, NC
- --------------------------------------------------
XXX 424 Greensboro, NC
- --------------------------------------------------
XXX 430 Greenville, SC
- --------------------------------------------------
XXX 432 Florence, SC
- --------------------------------------------------
XXX 448 Pensacola, FL
- --------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
LATA
Tier Number LATA Name
- --------------------------------------------------
<S> <C> <C>
XXX 452 Louisville, KY
- --------------------------------------------------
XXX 468 Memphis, TN
- --------------------------------------------------
XXX 474 Knoxville, TN
- --------------------------------------------------
XXX 476 Birmingham, AL
- --------------------------------------------------
XXX 477 Huntsville, AL
- --------------------------------------------------
XXX 484 Biloxi, MS
- --------------------------------------------------
XXX 528 Little Rock, AR
- --------------------------------------------------
XXX 540 El Paso, TX
- --------------------------------------------------
XXX 558 Austin, TX
- --------------------------------------------------
XXX 564 Corpus Christi, TX
- --------------------------------------------------
XXX 566 San Antonio, TX
- --------------------------------------------------
XXX 568 Brownsville, TX
- --------------------------------------------------
XXX 640 South Dakota SD
- --------------------------------------------------
XXX 668 Tucson, AZ
- --------------------------------------------------
XXX 674 Seattle, WA
- --------------------------------------------------
XXX 720 Reno, NV
- --------------------------------------------------
XXX 724 Chico, CA
- --------------------------------------------------
XXX 726 Sacramento, CA
- --------------------------------------------------
XXX 732 San Diego, CA
- --------------------------------------------------
XXX 736 Monterey, CA
- --------------------------------------------------
XXX 738 Stockton, Ca
- --------------------------------------------------
XXX 740 San Luis Obispo, CA
- --------------------------------------------------
XXX 922 Cincinnati, OH
- --------------------------------------------------
XXX 949 Fayetteville, NC
- --------------------------------------------------
XXX 951 Rocky Mount, NC
- --------------------------------------------------
XXX 973 Palm Springs, CA
- --------------------------------------------------
XXX 974 Rochester, NY
- --------------------------------------------------
- --------------------------------------------------
</TABLE>
<PAGE>
Transcend
TIER XXX LOCATIONS
LATA LATA
Tier Number LATA Name Tier Number LATA Name
XXX 120 MAINE ME XXX 624 Duluth, MN
- --------------------------------------------------------------------------------
XXX 124 VERMONT Vt XXX 626 St. Cloud, MN
- --------------------------------------------------------------------------------
XXX 130 Rhode Island RI XXX 630 Sioux City, IA
- --------------------------------------------------------------------------------
XXX 138 Binghampton, NY XXX 636 Fargo, ND
- --------------------------------------------------------------------------------
XXX 226 Capital, PA XXX 638 Bismark, ND
- --------------------------------------------------------------------------------
XXX 230 Altoona, PA XXX 646 Garnd Island, NE
- --------------------------------------------------------------------------------
XXX 232 Northeast PA XXX 648 Great Falls, MT
- --------------------------------------------------------------------------------
XXX 240 Hagerstown, MD XXX 650 Billings, MT
- --------------------------------------------------------------------------------
XXX 242 Salisbury, MD XXX 654 Wyoming, WY
- --------------------------------------------------------------------------------
XXX 244 Roanoke, VA XXX 658 Colorado Springs, CO
- --------------------------------------------------------------------------------
XXX 254 Charleston, WV XXX 664 New Mexico NM
- --------------------------------------------------------------------------------
XXX 256 Clarksburg, WV XXX 670 Eugene, OR
- --------------------------------------------------------------------------------
XXX 322 Youngstown, OH XXX 676 Spokane, WA
- --------------------------------------------------------------------------------
XXX 328 Dayton, OH XXX 728 Fresno, Ca
- --------------------------------------------------------------------------------
XXX 334 Auburn/Huntington, IN XXX 734 Bakersfield, Ca
- --------------------------------------------------------------------------------
XXX 360 Rockford, IL XXX 921 Fisher's Island, NY
- --------------------------------------------------------------------------------
XXX 362 Cairo, IL XXX 923 Mansfield, OH
- --------------------------------------------------------------------------------
XXX 364 Sterling, IL XXX 924 Erie, PA
- --------------------------------------------------------------------------------
XXX 376 Quincy, IL XXX 927 Harrisonburg, VA
- --------------------------------------------------------------------------------
XXX 420 Asheville, NC XXX 928 Charlottesville, Va
- --------------------------------------------------------------------------------
XXX 428 Wilmington, NC XXX 929 Edinburg, VA
- --------------------------------------------------------------------------------
XXX 436 Charleston, SC XXX 932 Blue Field, WV
- --------------------------------------------------------------------------------
XXX 450 Panama City, FL XXX 937 Richmond, IN
- --------------------------------------------------------------------------------
XXX 464 Owensboro, KY XXX 938 Terre Haute, IN
- --------------------------------------------------------------------------------
XXX 466 Winchester, KY XXX 939 Fort Meyers, FL
- --------------------------------------------------------------------------------
XXX 482 Jackson, MS XXX 956 Bristol, TN
- --------------------------------------------------------------------------------
XXX 526 Fort Smith, Ar XXX 958 Lincoln, NE
- --------------------------------------------------------------------------------
XXX 530 Pine Bluff, Ar XXX 960 Coeur D'Alene, ID
- --------------------------------------------------------------------------------
XXX 542 Midland, TX XXX 961 San Angelo, TX
- --------------------------------------------------------------------------------
XXX 544 Lubbock, TX XXX 963 Kalispell, MT
- --------------------------------------------------------------------------------
XXX 546 Amarillo, TX XXX 976 Mattoon, IL
- --------------------------------------------------------------------------------
XXX 548 Wichita Falls, TX XXX 977 Galesburg, IL
- --------------------------------------------------------------------------------
XXX 550 Abilene, TX XXX 978 Olney, IL
- --------------------------------------------------------------------------------
XXX 556 Waco, TX XXX 980 Navajo Territory, AZ
- --------------------------------------------------------------------------------
XXX 570 Hearne, TX XXX 981 Navajo Territory, UT
- --------------------------------------------------------------------------------
XXX 620 Rochester, MN XXX
- --------------------------------------------------------------------------------
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
TRANSCEND INTERNATIONAL TRANSPORT PRICING
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
XXXX XXXXX XXXXX XXXXX XXXXX XXXXX
Base Int'l Monthly Int'l Monthly Int'l Monthly Int'l Monthly Int'l Monthly Int'l Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Afghanistan 93 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Albania 355 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Algeria 213 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Amer Samoa 684 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Angola 244 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Anguilla 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Antarctica (Casey) 672 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Antarctica (Scott) 672 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Antigua 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Argentina 54 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Armenia 374 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Aruba 297 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ascension Island 247 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Australia 61 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Austria 43 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Azerbaijan 994 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bahamas 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bahrain 973 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bangladesh 880 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Barbados 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Belarus 375 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Belgium 32 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Belize 501 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Benin 229 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bermuda 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bhutan 975 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bolivia 591 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bosnia-Herzegovina 387 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
2/25/96 Schedule 2 Page 1 of 9
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
TRANSCEND INTERNATIONAL TRANSPORT PRICING
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
XXXX XXXXX XXXXX XXXXX XXXXX XXXX
Int'l Int'l Int'l Int'l Int'l Int'l
Base Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Botswana 267 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Brazil 55 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
British Virgin Islands 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Brunei 673 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Bulgaria 359 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Burkina Faso 226 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Burundi 257 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cambodia 855 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cameroon 237 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Canada XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cape Verde Islands 238 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cayman Islands 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Central African Republic 236 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Chad Republic 235 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Chile 56 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
China 86 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Colombia 57 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Comoros (Mayotte Island) 269 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Congo 242 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cook Islands 682 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Costa Rica 506 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Croatia 385 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cuba 53 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Cyprus 357 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Czech Republic 42 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Denmark 45 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Diego Garcia 246 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
Djibouti 253 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------
2/25/96 Schedule 2 Page 2 of 9
</TABLE>
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
TRANSCEND INTERNATIONAL TRANSPORT PRICING
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
XXXX XXXXX
Base Int'l Monthly Int'l Monthly
COUNTRY Country International Revenue Revenue
Code Charges Level Level
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dominica 809 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Dominican Republic 809 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Ecuador 593 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Egypt 20 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
El Salvador 503 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Equi Guinea 240 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Eritrea XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Estonia 372 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Ethiopia 251 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Faeroe Islands 298 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Falkland Islands 500 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Fiji Islands 679 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Finland 358 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Fr Guiana 594 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Fr Polynesia 689 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
France (Andorra, Monaco) 33 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
French Antilles 596 XXXXXX XXXXXX XXXXXX
(St. Barth, Mrtnque, St. M)
- ------------------------------------------------------------------------------------------------------------
Gabon 241 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Gambia 220 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Georgia 995 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Germany 49 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Ghana 233 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Gibraltar 350 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Greece 30 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Greenland 299 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Grenada 809 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Guadeloupe 590 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Guam 671 XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
XXXXX XXXXXX XXXXX XXXXX
Int'l Monthly Int'l Monthly Int'l Monthly Int'l Monthly
COUNTRY Revenue Revenue Revenue Revenue
Level Level Level Level
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dominica XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Dominican Republic XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Ecuador XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Egypt XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
El Salvador XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Equi Guinea XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Eritrea XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Estonia XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Ethiopia XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Faeroe Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Falkland Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Fiji Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Finland XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Fr Guiana XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Fr Polynesia XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
France (Andorra, Monaco) XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
French Antilles XXXXXX XXXXXX XXXXXX XXXXXX
(St. Barth, Mrtnque, St. M)
- ------------------------------------------------------------------------------------------------------------
Gabon XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Gambia XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Georgia XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Germany XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Ghana XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Gibraltar XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Greece XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Greenland XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Grenada XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Guadeloupe XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
Guam XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------
</TABLE>
2/25/96 Schedule 2 Page 3 of 9
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
<TABLE>
<CAPTION>
TRANSCEND INTERNATIONAL TRANSPORT PRICING
- -------------------------------------------------------------------------------------------------------------------
XXXXX XXXXX XXXXX XXXXX XXXXX XXXXX
Base Int'l Int'l Int'l Int'l Int'l Int'l
Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
Guantan. Bay 5399 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Guatemala 502 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Guinea 224 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Guinea Bissau 245 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Guyana 592 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Haiti 509 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Honduras 504 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Hong Kong 852 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Hungary 36 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Iceland 354 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
India 91 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Indonesia 62 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Inmarsat ATL WEST 874 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Inmarsat IND OCEAN 873 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Inmarsat PAC OCEAN 872 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Inmarsat ATL EAST 871 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Iran 98 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Iraq 964 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Ireland 353 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Israel 972 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Italy 39 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Ivory Coast 225 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Jamaica 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Japan 81 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Jordan 962 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Kazakhstan 7 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Kenya 254 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Kiribati 686 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
2/25/96 Schedule 2 Page 4 of 9
</TABLE>
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
<TABLE>
<CAPTION>
TRANSCEND INTERNATIONAL TRANSPORT PRICING
- -------------------------------------------------------------------------------------------------------------------
XXXXX XXXXX XXXXX XXXXX XXXXX XXXXX
Base Int'l Int'l Int'l Int'l Int'l Int'l
Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
Korea, South 82 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Kuwait 965 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Krgystan 7 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Laos 856 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Latvia 371 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Lebanon 961 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Lesotha 266 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Liberia 231 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Libya 218 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Lithuania 370 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Luxembourg 352 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Macao 853 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Macedonia 389 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Madagascar 261 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Malawi 265 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Malaysia 60 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Maldives 960 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mali Rep 223 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Malta 356 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Marshall Islands 692 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mauritania 222 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mauritius 230 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 1 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 1 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 2 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 2 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 3- Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
2/25/96 Schedule 2 Page 5 of 9
</TABLE>
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
<TABLE>
<CAPTION>
TRANSCEND INTERNATIONAL TRANSPORT PRICING
- -------------------------------------------------------------------------------------------------------------------
XXXXX XXXXX XXXXX XXXXX XXXXX XXXXX
Base Int'l Int'l Int'l Int'l Int'l Int'l
Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 3 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 4 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 4 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 5 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 5 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 6 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 6 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 7 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 7 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 8 - Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mexico Band 8 - Off Peak XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Micronesia 691 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Moldova (CIS) 373 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mongolia 976 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Monsterrat 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Morocco 212 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Mozambique 258 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Myanmar 95 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Namibia 264 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Nauru 674 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Nepal 977 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Neth Antilles 599 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Netherlands 31 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Nevis 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
New Calendonia 687 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
New Zealand 64 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Nicaragua 505 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Niger 227 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
2/25/96 Schedule 2 Page 6 of 9
</TABLE>
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
<TABLE>
<CAPTION>
TRANSCEND INTERNATIONAL TRANSPORT PRICING
- -------------------------------------------------------------------------------------------------------------------
XXXXX XXXXX XXXXX XXXXX XXXXX XXXXX
Base Int'l Int'l Int'l Int'l Int'l Int'l
Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
Nigeria 234 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Niue Island 683 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Folk Island (Christmas
Coco Antarc) 672 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Norway 47 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Oman 968 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Pakistan 92 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Palau 680 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Panama 507 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Papua N Guin 675 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Paraguay 595 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Peru 51 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Philippines 63 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Poland 48 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Portugal 351 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Qatar 974 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Reunion Island 262 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Romania 40 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Russia 7 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Rwanda 250 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Saipan (Tinlan, Rota) 670 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Sao Tome 239 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Saudi Arabia 966 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Senegal Rep 221 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Seychelles Island 248 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Sierra Leone 232 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Singapore 65 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Slovakia XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Slovenia 386 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
2/25/96 Schedule 2 Page 7 of 9
</TABLE>
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
<TABLE>
<CAPTION>
TRANSCEND INTERNATIONAL TRANSPORT PRICING
- -------------------------------------------------------------------------------------------------------------------
XXXXX XXXXX XXXXX XXXXX XXXXX XXXXX
Base Int'l Int'l Int'l Int'l Int'l Int'l
Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
Solomon Island 677 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Somalia 252 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
South Africa 27 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Spain 34 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Sri Lanka 94 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
St Helena 290 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
St Kitts 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
St Lucia 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
St Pierre/Miq 508 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
St Vent/Gren 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Sudan XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Suriname 597 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Swaziland 268 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Sweden 46 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Switzerland 41 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Syria 963 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Tadjikistan 7 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Taiwan 888 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Tanzania 255 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Thailand 66 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Togo 228 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Tonga 676 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Trinidad/Tob 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Tunisia 216 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Turkey 90 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Turkmenistan 7 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Turks/Calcos 809 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
Tuvalu 688 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- -------------------------------------------------------------------------------------------------------------------
2/25/96 Schedule 2 Page 8 of 9
</TABLE>
<PAGE>
NOTE: Local Access must be added to International Transport for switched calls
and domestic transport must be added for all call types.
TRANSCEND INTERNATIONAL TRANSPORT PRICING
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
XXXX XXXX XXXX XXXX XXXX XXXX
Int'l Int'l Int'l Int'l Int'l Int'l
Base Monthly Monthly Monthly Monthly Monthly Monthly
COUNTRY Country International Revenue Revenue Revenue Revenue Revenue Revenue
Code Charges Level Level Level Level Level Level
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Uganda 256 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Ukraine 380 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
United Ar Emir 971 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
United Kingdom 44 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Uruguay 596 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Uzbekistan 7 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Vanuatu 678 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Venezuela 58 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Vietnam 84 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Wallis/Fut XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
West Samoa 685 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Yemen, Rep of 967 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Yugoslavia 381 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Zaire 243 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Zambia 260 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
Zimbabwe 263 XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
2/25/96 Schedule 2 Page 9 of 9
<PAGE>
Transcend Basic Travel Card Service Intrastate
Price Schedule
[LOGO OF WILTEL
APPEARS HERE]
<TABLE>
<CAPTION>
Switched Access Dedicated Access Switched Access Dedicated Access
-------------------------------------- --------------------------------------
State Peak Off Peak Peak Off Peak State Peak Off Peak Peak Off Peak
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------
ALABAMA XXXXXX XXXXXX XXXXXX XXXXXX NEBRASKA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
ARIZONA XXXXXX XXXXXX XXXXXX XXXXXX NEVADA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
ARKANSAS XXXXXX XXXXXX XXXXXX XXXXXX NEW HAMPSHIRE XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
CALIFORNIA * XXXXXX XXXXXX XXXXXX XXXXXX NEW JERSEY XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
California Intra-LATA* XXXXXX XXXXXX XXXXXX XXXXXX NEW MEXICO XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
COLORADO XXXXXX XXXXXX XXXXXX XXXXXX NEW YORK XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
CONNECTICUT XXXXXX XXXXXX XXXXXX XXXXXX NORTH CAROLINA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
DELAWARE XXXXXX XXXXXX XXXXXX XXXXXX NORTH DAKOTA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
FLORIDA XXXXXX XXXXXX XXXXXX XXXXXX OHIO XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
GEORGIA XXXXXX XXXXXX XXXXXX XXXXXX OKLAHOMA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
IDAHO XXXXXX XXXXXX XXXXXX XXXXXX OREGON XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
ILLINOIS XXXXXX XXXXXX XXXXXX XXXXXX PENNSYLVANIA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
INDIANA XXXXXX XXXXXX XXXXXX XXXXXX RHODE ISLAND XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
IOWA XXXXXX XXXXXX XXXXXX XXXXXX SOUTH CAROLINA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
KANSAS XXXXXX XXXXXX XXXXXX XXXXXX SOUTH DAKOTA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
KENTUCKY XXXXXX XXXXXX XXXXXX XXXXXX TENNESSEE XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
LOUISIANA XXXXXX XXXXXX XXXXXX XXXXXX TEXAS XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MAINE XXXXXX XXXXXX XXXXXX XXXXXX UTAH XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MARYLAND XXXXXX XXXXXX XXXXXX XXXXXX VERMONT XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS XXXXXX XXXXXX XXXXXX XXXXXX VIRGINIA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MICHIGAN XXXXXX XXXXXX XXXXXX XXXXXX WASHINGTON XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MINNESOTA XXXXXX XXXXXX XXXXXX XXXXXX WEST VIRGINIA XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI XXXXXX XXXXXX XXXXXX XXXXXX WISCONSIN XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MISSOURI XXXXXX XXXXXX XXXXXX XXXXXX WYOMING XXXXXX XXXXXX XXXXXX XXXXXX
- -----------------------------------------------------------------------------------------------------------------------------
MONTANA XXXXXX XXXXXX XXXXXX XXXXXX
- ----------------------------------------------------------------
</TABLE>
* Billed on an XX-sec minimum per call, with XX-sec Increments (16/6).
* Customers will be required to maintain an average call dur of XX min for all
Intralata and Intrastate services by product.
Intrastate Rates are non-discountable.
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
COUNTRY Country Standard Rate Discount Standard Discount
---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Additional X 1st XX Sec. Additional X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Albania 355 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Algeria 213 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Amer Samoa 684 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Andorra XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Angola 244 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Anguilla 809 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Antarctica XXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXX XXX
- ------------------------------------------------------------------------------------------------------------------------------------
Antigua 809 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Argentina 54 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Armenia XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Aruba 297 4PM-8:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ascension Island 247 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Australia 61 2PM-7:59PM 8PM-1:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Austria 43 7AM-12:58PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Azerbaijan XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bahamas 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bahrain 973 8AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Balearic Islands XXXXXXXXX XXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bangladesh 880 6AM-5:58PM 6PM-5:58AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Barbados 809 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Belarus XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Belgium 32 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Belize 501 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Benin 229 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bermuda 809 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bhutan 975 6PM-5:59AM 6AM-5:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bolivia 591 4PM-11:59PM 12AM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bosnia-Herzegovina XXXXXXXXXXXXXX XXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Botswana 267 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Brazil 55 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
British Virgin Islands 809 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Brunei 673 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Bulgaria 359 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Burkina Faso 226 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Burundi 257 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cambodia 855 5PM-1:58AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cameroon 237 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------
Dedicated
---------------------------------------------------------
Standard Discount
---------------------------------------------------------
COUNTRY 1st XX Sec. Additional X 1st XX Sec. Additional X
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Albania XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Algeria XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Amer Samoa XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Andorra XXXXXXXXXX XXXXXXXXXX
- --------------------------------------------------------------------------------
Angola XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Anguilla XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Antarctica XXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXX
- --------------------------------------------------------------------------------
Antigua XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Argentina XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Armenia XXXXXXXXXX XXXXXXXXXX
- --------------------------------------------------------------------------------
Aruba XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Ascension Island XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Australia XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Austria XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Azerbaijan XXXXXXXXXX XXXXXXXXXX
- --------------------------------------------------------------------------------
Bahamas XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Bahrain XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Balearic Islands XXXXXXXXX XXXXXXXXX
- --------------------------------------------------------------------------------
Bangladesh XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Barbados XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Belarus XXXXXXXXXX XXXXXXXXXX
- --------------------------------------------------------------------------------
Belgium XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Belize XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Benin XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Bermuda XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Bhutan XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Bolivia XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Bosnia-Herzegovina XXXXXXXXXXXXXX XXXXXXXXXXXXXX
- --------------------------------------------------------------------------------
Botswana XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Brazil XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
British Virgin Islands XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Brunei XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Bulgaria XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Burkina Faso XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Burundi XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Cambodia XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
Cameroon XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
</TABLE>
Page 1 of 7
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
COUNTRY Standard Discount
Country Standard Rate Discount ---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Additional X 1st XX Sec. Additional X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Canary Islands XXXXXXXXX XXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cape Verde Islands 238 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Carriacou XXXXXXXXXXX XXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cayman Islands 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Central African Republic 236 6AM-11:59PM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Chad Republic 235 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Chile 56 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
China 86 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Christmas Coco XXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Columbia 57 4PM-11:59PM 12AM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Comoros (Mayolle Island) 269 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Congo 242 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cook Islands 682 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Costa Rica 506 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Croatia XXXXXXXXXXXXXX XXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cuba* 53 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cuela XXXXXXXXX XXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Cyprus 357 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Czech Republic 42 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Denmark 45 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Diego Garcia 246 6AM-5:59PM 6PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Djibouti 253 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Dominica 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Dominican Republic 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ecuador 593 4PM-11:59PM 12AM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Egypt 20 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
El Salvador 503 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Equi Guinea 240 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Estonia 372 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ethiopia 251 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Faeroe Islands 298 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Falkland Islands 500 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Fiji Islands 679 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Finland 358 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Fr Guiana 594 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Fr Polynesia 689 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
France (Andorra, Monaco) 33 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
---------------------------------------------------------
Dedicated
---------------------------------------------------------
COUNTRY Standard Discount
---------------------------------------------------------
1st XX Sec. Additional X 1st XX Sec. Additional X
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Canary Islands XXXXXXXXX XXXXXXXXX
- ---------------------------------------------------------------------------------
Cape Verde Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Carriacou XXXXXXXXXXX XXXXXXXXXXX
- ---------------------------------------------------------------------------------
Cayman Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Central African Republic XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Chad Republic XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Chile XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
China XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Christmas Coco XXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
Columbia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Comoros (Mayolle Island) XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Congo XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Cook Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Costa Rica XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Croatia XXXXXXXXXXXXXX XXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
Cuba* XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Cuela XXXXXXXXX XXXXXXXXX
- ---------------------------------------------------------------------------------
Cyprus XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Czech Republic XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Denmark XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Diego Garcia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Djibouti XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Dominica XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Dominican Republic XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Ecuador XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Egypt XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
El Salvador XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Equi Guinea XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Estonia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Ethiopia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Faeroe Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Falkland Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Fiji Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Finland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Fr Guiana XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Fr Polynesia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
France (Andorra, Monaco) XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
</TABLE>
Page 2 of 7
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
COUNTRY Country Standard Rate Discount Standard Discount
---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Additional X 1st XX Sec. Additional X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Antilles (St. Barth.
Mrtnque. St) 596 6AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Gabon 241 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Gambia 220 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Georgia XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Germany 49 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ghana 233 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Gibraltar 350 7AM-12:59PM 1PM-8:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Greece 30 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Greenland 299 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Grenada 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guadeloupe 580 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guam 671 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guantan. Bay 5399 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guatemala 502 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guinea 224 1PM-7:59PM 8PM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guinea Bissau 245 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Guyana 592 8AM-5:59PM 8PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Haiti 509 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Honduras 504 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Hong Kong 852 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Hungary 36 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Iceland 354 1PM-7:59PM 8PM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
India 91 6AM-5:59PM 6PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Indonesia 62 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Inmarsal ATL WEST 874 Orig US Times Orig US Times XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Inmarsal IND OCEAN 873 Orig US Times Orig US Times XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Inmarsal PAC OCEAN 872 Orig US Times Orig US Times XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Inmarsal ATL EAST 871 Orig US Times Orig US Times XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Iran 98 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Iraq 964 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ireland 353 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Israel 972 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Italy 39 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ivory Coast 225 8AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Jamaica 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Japan 81 2PM-7:59PM 6PM-1:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Jordan 962 8AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
COUNTRY Dedicated
---------------------------------------------------------
Standard Discount
---------------------------------------------------------
1st XX Sec. Additional X 1st XX Sec. Additional X
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Antilles (St.Barth.
Mrtnque,St) XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Gabon XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Gambia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Georgia XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Germany XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Ghana XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Gibraltar XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Greece XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Greenland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Grenada XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guadeloupe XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guam XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guantan. Bay XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guatemala XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guinea XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guinea Bissau XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Guyana XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Haiti XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Honduras XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Hong Kong XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Hungary XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Iceland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
India XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Indonesia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Inmarsal AIL WEST XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Inmarsal IND OCEAN XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Inmarsal PAC OCEAN XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Inmarsal AIL EAST XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Iran XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Iraq XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Ireland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Israel XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Italy XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Ivory Coast XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Jamaica XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Japan XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Jordan XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
</TABLE>
2/25/96
Page 3 of 7
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
COUNTRY Country Standard Rate Discount Standard Discount
---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Addit'l X 1st XX Sec. Addit'l X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Kazakhstan XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Kenya 254 7AM-4:59PM 5PM-8:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Kirghizia XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Kinbali 686 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Kuwait 965 7AM-4:59PM 5PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Kyrgyzstan XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Laos 856 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Latvia 371 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Lebanon 961 8AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Lesotho 266 7AM-4:59PM 5PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Liberia 231 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Libya 218 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Liechtenstein XXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Lithuania 370 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Luxembourg 352 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Macao 853 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Macedonia 389 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Madagascar 261 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Malawi 265 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Malaysia 60 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Maldives 960 6PM-12:59AM 1AM-5:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mali Rep 223 6AM-11:59PM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Malta 356 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Marshall Islands 692 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Martinique XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mauritania 222 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mauritius 230 6AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mayotte Island XXXXXXXXXXX XXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Melilla XXXXXXXXX XXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Micronesia 691 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Moldova 373 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Monaco XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mongolia 976 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Montserrat 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Morroco 212 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mozambique 258 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Mustique 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
[CAPTION]
<TABLE>
<CAPTION>
---------------------------------------------------------
Dedicated
---------------------------------------------------------
Standard Discount
---------------------------------------------------------
COUNTRY 1st XX Sec. Addit'l X 1st XX Sec. Addit'l X
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Kazakhstan XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Kenya XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Kirghizia XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Kinbali XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Kuwait XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Kyrgyzstan XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Laos XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Latvia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Lebanon XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Lesotho XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Liberia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Libya XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Liechtenstein XXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
Lithuania XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Luxembourg XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Macao XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Macedonia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Madagascar XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Malawi XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Malaysia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Maldives XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Mali Rep XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Malta XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Marshall Islands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Martinique XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
Mauritania XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Mauritius XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Mayotte Island XXXXXXXXXXX XXXXXXXXXXX
- ---------------------------------------------------------------------------------
Melilla XXXXXXXXX XXXXXXXXX
- ---------------------------------------------------------------------------------
Micronesia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Moldova XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Monaco XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Mongolia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Montserrat XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Morroco XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Mozambique XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Mustique XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
</TABLE>
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
Standard Discount
COUNTRY Country Standard Rate Discount ---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Additional X 1st XX Sec. Additional X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Myanmar 95 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
N Caledonia 687 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Nakhodka XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Namibia 264 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Nauru 674 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Nepal 977 6AM-5:59PM 6PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Neth Antilles 599 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Netherlands 31 7AM-12:59PM 1PM-8:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Nevis 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
New Zealand 64 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Nicaragua 505 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Niger 227 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Nigeria 234 7AM-4:59PM 5PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Niue Island 683 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Island (Christmas Coco
Ant) 672 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Norway 47 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Oman 968 8AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Pakistan 92 6AM-5:59PM 6PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Palau 680 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Palm Island 809 4PM-9:59PM 10PM-9:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Panama 507 5PM-10:59PM 11PM-4:49PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Papua N Guin 675 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Paraguay 595 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Peru 51 4PM-11:59PM 12AM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Philippines 63 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Poland 48 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Portugal 351 1PM-7:59PM 8PM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Qatar 974 7AM-4:59PM 5PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Reunion Island 262 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Romania 40 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Rola XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Russia 7 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Rwanda 250 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Saipan (Tinian, Rola) 670 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Sakhalin XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
San Marina XXXXXXXXX XXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Sao Tome 239 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
COUNTRY Dedicated
---------------------------------------------------------
Standard Discount
---------------------------------------------------------
1st XX Sec. Additional X 1st XX Sec. Additional X
- ----------------------- ---------------------------------------------------------
<S> <C> <C> <C> <C>
Myanmar XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
N Caledonia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Nakhodka XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Namibia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Nauru XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Nepal XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Neth Antilles XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Netherlands XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Nevis XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
New Zealand XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Nicaragua XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Niger XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Nigeria XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Niue Island XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Island (Christmas Coco
Ant) XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Norway XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Oman XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Pakistan XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Palau XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Palm Island XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Panama XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Papua N Guin XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Paraguay XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Peru XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Philippines XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Poland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Portugal XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Qatar XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Reunion Island XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Romania XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Rola XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Russia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Rwanda XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Saipan (Tinian, Rola) XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Sakhalin XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
San Marina XXXXXXXXX XXXXXXXXX
- ---------------------------------------------------------------------------------
Sao Tome XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
</TABLE>
2/25/96 Page 5 of 7
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
COUNTRY Country Standard Rate Discount Standard Discount
---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Addit'l X 1st XX Sec. Addit'l X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Saudi Arabia 966 7AM-4:59PM 5PM-6:59 AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Senegal Rep 221 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Seychelles Island 248 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Sierra Leone 232 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Singapore 65 5PM-11:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Slovakia XXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Slovenia XXXXXXXXXXXXXX XXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Solomon Island 677 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Somalia 252 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
South Africa 27 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
South Korea 82 2PM-7:59PM 8PM-1:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Spain 34 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Sri Lanka 94 6AM-5:59PM 6PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Barthelemy XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Helena 290 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Kitts 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Lucia 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Martin XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Pierre/Miq 508 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
St Vent/Gren 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Sudan 249 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Suriname 597 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Swaziland 268 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Sweden 46 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Switzerland 41 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Syria 963 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Taiwan 886 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Tajikistan XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Tanzania 255 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Thailand 66 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Tinian XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Togo 228 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Tonga 676 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Trinidad/Tob 809 8AM-4:59PM 5PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Tunisia 216 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Turkey 90 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Turkmenistan XXXXXXXXXX XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
COUNTRY Dedicated
---------------------------------------------------------
Standard Discount
---------------------------------------------------------
1st XX Sec. Addit'l X 1st XX Sec. Addit'l X
- ----------------------- ---------------------------------------------------------
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------
Saudi Arabia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Senegal Rep XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Seychelles Island XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Sierra Leone XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Singapore XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Slovakia XXXXXXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
Slovenia XXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
Solomon Island XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Somalia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
South Africa XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
South Korea XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Spain XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Sri Lanka XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
St Barthelemy XXXXXXXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
St Helena XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
St Kitts XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
St Lucia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
St Martin XXXXXXXXXXXXXXXXXXX
- ---------------------------------------------------------------------------------
St Pierre/Miq XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
St Vent/Gren XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Sudan XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Suriname XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Swaziland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Sweden XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Switzerland XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Syria XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Taiwan XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Tajikistan XXXXXXXXXX
- ---------------------------------------------------------------------------------
Tanzania XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Thailand XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Tinian XXXXXXXXXX
- ---------------------------------------------------------------------------------
Togo XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Tonga XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Trinidad/Tob XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Tunisia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Turkey XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Turkmenistan XXXXXXXXXX
- ---------------------------------------------------------------------------------
</TABLE>
<PAGE>
Transcend International Basic Travel Card Service Rates
<TABLE>
<CAPTION>
- ------------------------------- ---------------------------------------------------------
Switched
----------------------------------------------------------------------------------------------------
COUNTRY Country Standard Rate Discount Standard Discount
---------------------------------------------------------
Code Period Rate Period 1st XX Sec. Additional X 1st XX Sec. Additional X
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Turks/Caicos 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Tuvalu 688 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Uganda 256 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Ukraine XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Union Island 809 4PM-9:59PM 10PM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
United Ar Emir 971 8AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
United Kingdom 44 7AM-12:59PM 1PM-6:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Uruguay 598 4PM-11:59PM 12AM-3:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Uzbekistan XXXXXXXXXX XXXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Vanualu 678 2PM-7:59PM 8PM-1:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Vatican City XXXXXXXXX XXXXXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Venezuela 58 8AM-5:59PM 6PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Vietnam 84 5PM-1:59AM 2AM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Wallis/Fut 681 2PM-7:59PM 8PM-1:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
West Samoa 685 5PM-10:59PM 11PM-4:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Yemen, Rep of 967 8AM-2:59PM 3PM-7:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Yugoslavia 381 1PM-1:59AM 2AM-12:59PM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Zaire 243 5AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Zambia 260 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
Zimbabwe 263 6AM-11:59AM 12PM-5:59AM XXXXXX XXXXXX XXXXXX XXXXXX
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
COUNTRY Dedicated
---------------------------------------------------------
Standard Discount
---------------------------------------------------------
1st XX Sec. Additional X 1st XX Sec. Additional X
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------
Turks/Caicos XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Tuvalu XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Uganda XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Ukraine XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Union Island XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
United Ar Emir XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
United Kingdom XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Uruguay XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Uzbekistan XXXXXXXXXX XXXXXXXXXX
- ---------------------------------------------------------------------------------
Vanualu XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Vatican City XXXXXXXXX XXXXXXXXX
- ---------------------------------------------------------------------------------
Venezuela XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Vietnam XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Wallis/Fut XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
West Samoa XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Yemen, Rep of XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Yugoslavia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Zaire XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Zambia XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
Zimbabwe XXXXXX XXXXXX XXXXXX XXXXXX
- ---------------------------------------------------------------------------------
</TABLE>
2/25/96 Page 7 of 7
<PAGE>
Transcent Enhanced Travel Card Service Pricing
ORIGINATION FROM U.S. TO LISTED TERMINATING LOCATIONS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Enhanced Puerto Rico
Feature U.S. Overseas Canada Mexico Alaska Hawaii & U.S. V.I.
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic Calling per min (day/non) XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXXXXXXXX XXXXXXXXXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Conf Calling per min (day/non) XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXXXXXXXX XXXXXXXXXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Directory Assistance per call XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Mesage store & forward per msg. XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Audio Text per min. XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- ----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Operator Services per call**** XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXXXXXXXX XXXXXXXXXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
ORIGINATION FROM LISTED LOCATIONS AND TERMINATING TO THE U.S.
- -----------------------------------------------------------------------------------------------------------------------------------
Enhanced Puerto Rico
Feature U.S. Overseas Canada Mexico Alaska Hawaii & U.S. V.I.
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic Calling per min (day/non) XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXXXXXXXX XXXXXXXXXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Conf Calling per min (day/non) XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Directory Assistance per call XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Mesage store & forward per msg. XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Audio Text per min. XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Operator Services per call**** XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXX XXXXXXXXXXX XXXXXXXXXXX XXXXXXXXXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Surcharge XXXX XXXXX XXXX XXXXX XXXX XXXX XXXX
- -----------------------------------------------------------------------------------------------------------------------------------
Page 1 of 2
</TABLE>
2/25/96
<PAGE>
Transcend Enhanced Travel Card Service Pricing
International Origination for U.S. Termination
- ----------------------------------------------------------------------
International 1st min Add'l min Toll Free
-------------------------
Origination Day Non-Day Access #
- ----------------------------------------------------------------------
Canada XXXXX XXXXX 800-746-5131
- ----------------------------------------------------------------------
Mexico XXXXXXXXXXXXXX
- ----------------------------------------------------------------------
Australia XXXXX XXXXX 1-800-122-234
- ----------------------------------------------------------------------
France XXXXX XXXXX 0591-5009
- ----------------------------------------------------------------------
Germany XXXXX XXXXX 0130-82-7170
- ----------------------------------------------------------------------
Israel XXXXX XXXXX 177-102-3231
- ----------------------------------------------------------------------
Japan XXXXX XXXXX 0031-15-1500
- ----------------------------------------------------------------------
Korea XXXXX XXXXX 0078-18-800-0008
- ----------------------------------------------------------------------
Switzerland XXXXX XXXXX 155-7410
- ----------------------------------------------------------------------
United Kingdom XXXXX XXXXX 0-800-96-3658
- ----------------------------------------------------------------------
N/A -- Service not available
* WIIMax International Switched Access Rate Schedule
** WIIMax Mexico Switched Access Rate Schedule
*** International Origination Rates
**** Operator Services charges are expressed as Station-Station/Person-Person
Note: Intrastate rates are at the WIIMax Intrastate Switched Access Rate
Schedule
Intrastate conference calling rates are at the WIIMax Intrastate Switched
Access Rate Schedule plus XXXXXXXXX
2/25/96 Page 2 of 2
<PAGE>
EXHIBIT 10.3
TRANSCEND/(TM)/
SERVICE SCHEDULE
----------------
This Service Schedule is made as of the 31st day of May, 1996, by and
between WorldCom Network Services, Inc. d/b/a WilTel ("WilTel") and Excel
Telecommunications, Inc. ("Customer") and is a part of their agreement for
switched services, identified as TSA#EXC-960415 (the "Agreement"). Neither
Customer nor WilTel shall be obligated with respect to the Service described
below, nor any other condition of Service until Customer has submitted and
WilTel has accepted a Service Request with respect to the particular Services.
1. TRANSCEND/(TM)/ SERVICES: During the Service Term of the Agreement,
WilTel will provide the following Services (all as more particularly described
herein), (i) to and from the locations below, (ii) for the charges and
discount(s), if any, set forth in the Program Enrollment Terms dated
concurrently herewith.
(a) Transcend/(TM)/ Termination Service ("TERMINATION Service") which
is WilTel's termination of calls received from Customer's Service
Interconnection(s).
(b) Transcend/(TM)/ 800 Origination Service ("800 ORIGINATION Service")
which is the origination of calls by WilTel and the termination of such calls to
Customer's Service Interconnection(s).
(c) Transcend/(TM)/ Switched Access Service ("SWITCHED ACCESS Service")
which is the origination and termination of calls solely over facilities
comprising the WilTel network.
(d) Transcend/(TM)/ Dedicated Access Service ("DEDICATED ACCESS
Service") which is the origination and termination of calls solely over
facilities comprising the WilTel network.
(e) Transcend/(TM)/ Travel Card Service ("TRAVEL CARD Service") which
is the origination and termination of calls solely over facilities comprising
the WilTel network. Further, the inbound service portion of a TRAVEL CARD
Service call (i.e., the 800 Service) must be provided by WilTel.
2. START OF SERVICE:
(a) Start of Service for TERMINATION Service will occur concurrently
with the activation of each circuit comprising Service Interconnections relevant
to WilTel TERMINATION Service.
(b) Start of Service for 800 ORIGINATION Service will occur
concurrently with the activation of each circuit comprising Service
Interconnections relevant to 800 ORIGINATION Service.
(c) Start of Service for SWITCHED ACCESS Service will occur on (i) an
ANI by ANI basis concurrently with the activation of each ANI to be served, and
(ii) an 800 Number by 800 Number basis concurrently with the activation of each
800 Number.
(d) Start of Service for DEDICATED ACCESS Service will occur
concurrently with the activation of each circuit comprising Service
Interconnections relevant to DEDICATED ACCESS Service.
Page 1 of 8 CONFIDENTIAL
2/25/96 ------------
<PAGE>
(e) Start of Service for TRAVEL CARD Service will occur on a
Authorization Code by Authorization Code basis concurrently with the activation
of each Authorization Code.
3. SERVICE INTERCONNECTIONS - TERMINATION SERVICE AND 800 ORIGINATION
SERVICE:
(a) In order to utilize TERMINATION Service and 800 ORIGINATION
Service, one or more full time dedicated connections between Customer's network
and the WilTel network at one or more WilTel designated locations ("WilTel POP")
must be established ("Service Interconnection(s)"). Each Service
Interconnection shall be comprised of one or more DS-1 circuits.
(b) The circuit(s) comprising each Service Interconnection to a WilTel
POP shall be requested by Customer on the appropriate WilTel Service Request.
Each Service Request for TERMINATION Service or 800 Origination Service will
describe (among other things) the WilTel POP to which a Service Interconnection
is to be established, the Requested Service Date therefor, the type and quantity
of circuits comprising the Service Interconnection and any charges and other
information relevant thereto, such as, Customer's terminating or originating
switch location, as the case may be. Such additional information may be
obtained from Customer or gathered by WilTel and recorded in Technical
Information Sheets provided by WilTel.
(c) Once ordered, and unless otherwise provided for in this Agreement,
Service Interconnections or the circuits comprising each Service Interconnection
may only be canceled by Customer upon not less than thirty (30) days prior
written notice to WilTel.
(d) Absent the automatic number identification ("ANI") of the calling
party, Customer shall provide WilTel with a written certification (the
"Certification") of the percentage of interstate (including international) and
intrastate minutes of use relevant to the minutes of traffic to be terminated in
the same state in which the WilTel POP is located to which the Service
Interconnection is made. This Certification shall be provided by Customer prior
to Start of Service for any Service Interconnection and may be modified from
time to time by Customer and subject to recertification upon the request of
WilTel which requests shall not be made unilaterally by WilTel more than once
each calendar quarter. Any such modification(s) or Certification(s) shall be
effective as of the first day of any calendar month and following at least
forty-five (45) days notice from Customer. In the event Customer fails to make
such Certification, the relevant minutes of use will be deemed to be subject to
the Intrastate Rates provided for in the Pricing Exhibit. In the event WilTel
or any other third party requires an audit of WilTel's interstate/intrastate
minutes of traffic, Customer agrees to cooperate in such audit at its expense
and make its call detail records, billing systems and other necessary
information reasonably available to WilTel or any third party solely for the
purpose of verifying Customer's interstate/intrastate minutes of traffic.
Customer agrees to indemnify WilTel for any liability WilTel incurs in the event
Customer's Certification is different than that determined by the third party
audit.
(e) Customer shall be solely responsible for establishing and
maintaining each Service Interconnection over facilities subject to WilTel's
approval. Service Interconnections shall only be comprised of DS-1 facilities
unless otherwise provided for in the Service Request and agreed to in writing by
WilTel. If a Service Interconnection is proposed to be made via a local
exchange carrier, WilTel will have the authority to direct Customer to utilize
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WilTel's entrance facilities or local serving arrangement ("LSA") with the
relevant local telephone operating company, and Customer will be subject to a
non-discriminatory charge therefor from WilTel. The monthly recurring charge
relevant to Customer's use of LSA capacity shall be subject to upward adjustment
by WilTel from time to time. Such adjustment, if any, shall not exceed the rate
that otherwise would be charged for the equivalent switched access capacity
between the same points by the relevant local telephone operating company
pursuant to its published charges for the type of service in question.
(f) If other private line interexchange facilities are necessary to
establish a Service Interconnection, and such facilities are requested from
WilTel, such facilities will be provided on an individual case basis.
(g) Commencing with the first full calendar month following Start of
Service for each circuit comprising a Service Interconnection and thereafter,
Customer will maintain an average loading of traffic per DS-1 (or DS-1
equivalent circuit) of not less than 100,000 minutes of use per calendar
month/billing period ("Minimum Monthly Usage"). In the event Customer fails to
obtain the required Minimum Monthly Usage level for the circuits comprising each
Service Interconnection, WilTel will charge and Customer will pay XXXX
multiplied by the difference between the Minimum Monthly Usage and the actual
minutes of use for the circuit(s) comprising the Service Interconnection in
question ("Minimum Usage Charge"). WilTel TERMINATION Service and 800
ORIGINATION Service minutes carried over the same Service Interconnection, if
any, shall be included in determining if Customer has met the Minimum Monthly
Usage requirement.
Example: Customer's actual monthly usage for 2 DS-1s comprising
Customer's Service Interconnection at WilTel POP A is 180,000
minutes and Customer's actual monthly usage for 2 DS-1s
comprising Customer's Service Interconnection at WilTel POP B
is 270,000 minutes. Customer would be subject to a Minimum
Usage charge of XXXX since Customer's Minimum Monthly Usage
at WilTel POP A was below 200,000 [(2 x 100,000) - 180,000 x
XXXXXXXXXXX] and no Minimum Monthly Usage Charge for the
Service Interconnection at WilTel POP B, because Customer
exceeded the required minimum of 200,000 in actual minutes of
use for the 2 DS-1s comprising the Service Interconnection at
WilTel POP B.
(h) Customer may cancel circuits comprising the Service
Interconnection(s) at any time without liability to WilTel for cancellation
charges. In the event Customer does not have a Minimum Commitment and Customer
cancels all circuits comprising all Service Interconnections at any time during
the Service Term, the Cancellation Charge described in Subsection 2(A) of the
Agreement shall not apply. Provided, however, Customer shall nevertheless be
liable to pay WilTel a cancellation charge (regardless of the number of DS-1 or
DS-1 equivalent circuits comprising the Service Interconnection(s) in question)
of XXXXXX multiplied by the number of months (or pro rata portion thereof)
remaining in the Service Term ("Carrier Service Cancellation Charge").
(i) Because the damages to WilTel from Customer's cancellation or
termination of all circuits comprising all Service Interconnections prior to
completion of the Service Term is difficult if not impossible to determine, the
Carrier Service Cancellation Charge due to WilTel in accordance with this
Subsection is intended by the parties to establish liquidated damages payable by
Customer to WilTel and not as a penalty of any kind.
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4. SERVICE INTERCONNECTIONS - DEDICATED ACCESS:
(a) In order to utilize DEDICATED ACCESS Service, one or more full time
dedicated connections between an End User's private branch exchange ("PBX") or
other customer premise equipment and the WilTel network at one or more WilTel
designated locations ("WilTel POP") must be established ("Dedicated Service
Interconnection(s)"). Each Dedicated Service Interconnection shall be comprised
of one or more DS-1 circuits or DS-3 circuits.
(b) The circuit(s) comprising each Dedicated Service Interconnection to
a WilTel POP shall be requested by Customer on the appropriate WilTel Service
Request. Each Service Request for DEDICATED ACCESS Service will describe (among
other things) the WilTel POP to which a Dedicated Service Interconnection is to
be established, the Requested Service Date therefor, the type and quantity of
circuits comprising the Dedicated Service Interconnection and any charges and
other information relevant thereto, such as, the location of the end user's
originating or terminating location, as the case may be. Such additional
information may be obtained from Customer or gathered by WilTel and recorded in
Technical Information Sheets provided by WilTel.
(c) Once ordered, and unless otherwise provided for in this Agreement,
Dedicated Service Interconnections or the circuits comprising each Dedicated
Service Interconnection may only be canceled by Customer upon not less than
thirty (30) days prior written notice to WilTel.
(d) WilTel will provision and maintain local access facilities between
the End User Location and the WilTel POP, subject to any LEC charges plus other
applicable terms and charges set forth in WilTel's F.C.C. Tariff No. 5. If
other private line interexchange facilities are necessary to establish a
Dedicated Service Interconnection, such facilities will be provided on an
individual case basis.
(e) Customer may elect to be responsible for establishing each
Dedicated Service Interconnection over facilities subject to WilTel's approval.
Dedicated Service Interconnections shall only be comprised of DS-1 facilities
unless otherwise provided for in the Service Request. If a Dedicated Service
Interconnection is proposed to be made via a local exchange carrier, WilTel will
have the authority to direct Customer to utilize WilTel's entrance facilities or
local serving arrangement ("LSA") with the relevant local telephone operating
company, and Customer will be subject to a non-discriminatory charge therefor
from WilTel. The recurring charge relevant to Customer's use of LSA capacity
shall be stated in the corresponding Service Request subject, however, to upward
adjustment by WilTel. Such adjustment if any, shall not exceed the rate that
otherwise would be charged for the equivalent capacity between the same points
by the relevant local telephone operating company pursuant to its published
charges for the type of service in question.
(f) DEDICATED ACCESS SERVICE MINUTES OF USE ARE NOT SUBJECT TO
AGGREGATION FOR THE PURPOSE OF DETERMINING IF CUSTOMER HAS MET ITS MINIMUM
MONTHLY USAGE FOR TERMINATION SERVICE OR 800 ORIGINATION SERVICE.
5. BILLING INCREMENTS: U.S. Domestic (including Alaska, Hawaii, United
States Virgin Islands and Puerto Rico) Service calls will be billed in six (6)
second increments and subject to a six (6) second minimum charge (i) utilizing
Hardware Answer Supervision where available, and (ii) with respect to 800
Services, commencing with Customer's switch wink or answer back. If Customer
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<PAGE>
is found to be non-compliant in passing back appropriate answer supervision,
i.e., answer back, WilTel reserves the right to suspend 800 Service or deny
requests by Customer for additional Service until appropriate compliance is
established. All international calls will be billed in six (6) second
increments and subject to a thirty (30) second minimum charge.
6. FORECASTS: Before Customer's initial order for Service, Customer shall
provide WilTel with a forecast regarding the number of minutes expected to be
terminated or originated in various LATAs and/or Tandems, so as to enable WilTel
to configure optimum network arrangements. In the event Customer's Service
traffic volumes (e.g., specific ANIs more toll free numbers) result in a lower
than industry standard completion rate or otherwise adversely affect the WilTel
Network, WilTel reserves the right to block the source of such adverse traffic
(e.g., specific ANIs more toll free numbers) at any time. Customer will provide
WilTel with additional forecasts from time to time upon WilTel's request which
shall not be more frequent than once every three (3) months.
7. SERVICE INTERCONNECTION INSTALLATION:
(a) DS-1 circuits comprising all Service Interconnections (including
Dedicated Service Interconnections) will be subject to a nonrecurring XXXX per
DS-1 switch port installation charge.
(b) DS-3 circuits comprising all Service Interconnections (including
Dedicated Service Interconnections) will be subject to a nonrecurring per DS-3
switch port installation charge as determined on an individual case basis.
8. CDR TAPES: WilTel will provide Call Detail Records for WilTel's
Services in machine readable form ("CDR Tapes") subject to the provisions set
forth below:
(a) WilTel will provide Customer one (1) CDR Tape once each month in a
Fixed Rate Detail Record (FRDR) format which WilTel currently is then making
available to its Customers. Monthly CDR Tapes under this Subsection are
provided at no charge. Weekly CDR Tapes under this Subsection are subject to a
recurring monthly charge of XXXX.
(b) Customer may request and WilTel may provide Customer with daily
Call Detail Records electronically ("Daily CDR"). Daily CDR under this
Subsection is subject to a nonrecurring charge of XXXXXX. All leased-line and
equipment costs necessary to implement Daily CDR will be determined on an
individual case basis depending on Customer's specific configuration.
9. 800 NUMBERS:
(a) 800 numbers will be issued to Customer (i.e., issuance equates to
activation or reservation, whichever occurs first) on a random basis. Customer
requests for specific numbers will be considered by WilTel, and if provided,
will be subject to additional charges as set forth below and WilTel's then
current reservation policy which shall also apply to any randomly selected and
reserved 800 number. At any time preceding three (3) months from the scheduled
expiration of the Service Term, Customer may only reserve 800 numbers in an
amount equal to the greater of (i) 50, or (ii) fifteen percent (15%) of the
total number of 800 numbers activated by WilTel for Customer (unless another
allocation method is required by the FCC or other regulatory authority).
Customer requests for 800 numbers inconsistent with the above stated conditions
may be considered by WilTel on an individual case basis. 800 numbers reserved
for Customer will be activated upon Customer's request, however, each 800 number
will be subject to reversion to WilTel
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without notice to Customer after sixty (60) days from issuance to Customer in
the event WilTel records no level of measured charges associated with such
number as of the expiration or after said sixty (60) day period.
(b) Customer Request for Specific Numbers - XXX per individual
number.
(c) Customer specifically agrees that regardless of the method in which
an 800 number is reserved for or otherwise assigned to Customer, that Customer
will not seek any remedy from WilTel under a theory of detrimental reliance or
otherwise that such 800 number(s) are found not to be available for Customer's
use until such 800 number is put in service for the benefit of Customer, and
that such 800 number(s) shall not be sold, bartered, brokered or otherwise
released by Customer for a fee ("800 Number Trafficking"). Any attempt by
Customer to engage in 800 Number Trafficking shall be grounds for reclamation by
WilTel for reassignment of the 800 number(s) reserved for or assigned to
Customer.
10. ENHANCED 800 SERVICES: The following 800 identification services and
routing options (collectively, "Enhanced 800 Services") are available from
WilTel:
IDENTIFICATION SERVICES:
-----------------------
i. Dialed Number Identification Service - identification of
specific 800 number dialed.
ii. Real-Time ANI - receipt of telephone number of calling party.
800 ROUTING OPTIONS:
-------------------
i. Message Referral - recording (up to six (6) months) that informs
callers that the 800 number has been disconnected or refers
callers to new number.
ii. Call Area Selection - selection or blockage of locations where
800 numbers can be received from (i.e., State, NPA, LATA or NXX
level).
iii. Call Distributor Routing - distribution of 800 traffic evenly
over dedicated access lines in a trunk group (e.g., ascending,
descending, most idle, least idle).
iv. Route Completion (Overflow) - overflow of 800 dedicated access
traffic only to up to five (5) pre-defined alternate routing
groups (e.g., dedicated access, WATs access lines or switched
access lines).
v. Geographic Routing - termination of calls to a single 800 number
from two or more originating routing groups to different
locations.
vi. Time-of-Day Routing - routing of calls to single 800 number
based on time of day (up to forty-eight (48) time slots of 15-
minute increments in a 24-hour period).
vii. Day-of-Week Routing - routing of calls to single 800 number
based on each day of the week.
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viii. Day-of-Year Routing - routing of calls to single 800 number
based on up to fifteen (15) customer-specified holidays.
ix. Percent Allocation Routing - routing of calls for each
originating routing group to two (2) or more terminating
locations based on customer-specified percentage.
Customer will receive the Identification Services described above at no charge.
The minutes of use rates for 800 Routing Options described above (in addition to
the "800 Routing Option Feature Charges" described below) will be the same rates
for SWITCHED ACCESS Service (800) and DEDICATED ACCESS Service (800), whichever
is applicable, as described in the PET excluding Route Completion (Overflow).
If Customer selects Route Completion (Overflow) and Customer's traffic overflows
from DEDICATED ACCESS Service (800) to SWITCHED ACCESS Service (800), Customer's
minute of use rate will be the rate associated with SWITCHED ACCESS Service
(800). The 800 Routing Option Feature Charges are as follows:
Installation Charge: XXXXXX per feature; maximum of XXXXXXX per 800
------------------- ---
number.
Change Order Charge: XXXXXX per feature; maximum of XXXXXXX per 800
------------------- ---
number.
Monthly Recurring Charge: XXXXXX per feature; maximum of XXXXXXX
------------------------ ---
per 800 number.
Expedite Charge: XXXXXXX (i.e., outside normal interval time of
---------------
four (4) business days).
Note: More than ten (10) points of termination for a single feature
will be treated as two (2) features. Further, every additional ten
(10) points of termination will be treated as a separate feature.
11. RESPORG SERVICES: Responsible Organization Services (relevant to 800
Numbers) if provided by WilTel are provided pursuant to WilTel's F.C.C. Tariff
No. 5.
12. LIMITATION OF ORIGINATION OR TERMINATION LOCATIONS:
(a) TERMINATION Service: (i) origination is available from any WilTel
POP; and (ii) termination is to any direct dialable location worldwide.
(b) 800 ORIGINATION Service: (i) origination is available from
locations in the 50 United States, the United States Virgin Islands, Puerto Rico
and Canada; and (ii) termination is to any Customer designated Service
Interconnection.
(c) SWITCHED Service (1+): (i) origination is available from all equal
access exchanges in the 48 contiguous United States except in LATA 921 (Fishers
Island, NY) and Hawaii; and (ii) termination is to any direct dialable location
worldwide.
(d) SWITCHED Service (800): (i) origination is available from
locations in the 50 United States, the United States Virgin Islands, Puerto Rico
and Canada; and (ii) termination is available to locations in the 48 contiguous
United States.
(e) DEDICATED ACCESS Service (1+): (i) origination is available from
locations in the 48 contiguous United States; and (ii) termination is available
to any direct dialable location worldwide.
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(f) DEDICATED ACCESS Service (800): origination is available from
locations in the 50 United States, the United States Virgin Islands, Puerto Rico
and Canada; and (ii) termination is available to any Customer designated
Dedicated Service Interconnection.
(g) TRAVEL CARD Service: (i) origination is available from locations
in the 50 United States, the United States Virgin Islands, Puerto Rico and
Canada; (ii) termination is available to locations in the 48 contiguous United
States for calls from locations in the 50 United States, the United States
Virgin Islands, Puerto Rico and Canada; (iii) termination is available to
locations in the 50 United States, the United States Virgin Islands, Puerto Rico
and Canada for calls from locations in the 48 contiguous United States; and (iv)
International Origination is available from select locations for termination
within the 48 contiguous states.
13. AUTHORIZATION CODES-TRAVEL CARD SERVICE: WilTel will supply Customer
with authorization codes ("Codes") containing nine (9) digits for use with a
corresponding 800 Service number for origination and termination of TRAVEL CARD
Service calls. The Codes may be obtained by Customer in blocks of ten (10) not
to exceed a total of 1000 Codes at any one time. WilTel reserves the right to
deny access to any Code at any time.
14. ACCOUNTING CODES: For every billed telephone number (BTN) requested by
Customer, whether verified or non-verified, Customer shall pay a monthly
recurring charge of XXX.
IN WITNESS WHEREOF, the parties have executed this Service Schedule on
the date first written above.
WORLDCOM NETWORK SERVICES, INC. EXCEL TELECOMMUNICATIONS, INC.
d/b/a WilTel
By: /s/ Charles M. Cole By: /s/ Kenny A. Troutt
---------------------------- -----------------------------
(Signature) (Signature)
Charles M. Cole III Kenny A. Troutt
- -------------------------------- -----------------------------
(Print Name) (Print Name)
Vice President Carrier Sales President and CEO
- -------------------------------- -----------------------------
(Title) (Title)
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<PAGE>
EXHIBIT 10.4
AMENDMENT NO. 3 TO EXCEL RESELLER SERVICES AGREEMENT
This is Amendment No. 3 to the above agreement between Frontier
Communications Services, Inc ("Frontier") and Excel Telecommunications, Inc.
("Customer") dated February 20, 1995 and effective April 1, 1995, as
subsequently amended (the "Agreement").
1. Except as otherwise stated, capitalized terms used herein have the same
meaning as set forth in the Agreement.
2. The Agreement is hereby amended to eliminate the Monthly Minimum of
100,000,000 MOU of domestic outbound Switched Services traffic. All
references in the Agreement to Monthly Minimum are hereby deleted. All of
the rates and discounts applicable to outbound Switched Services shall
continue to apply without regard to usage level through October 1, 1996,
except rates in the initial States which are subject to change September 1
as provided below. Upon 30 days written notice, Frontier can raise its
rates on outbound Switched Services (which does not include 800 PIN and
Calling Card) to be effective no earlier than October 1, 1996. In the event
Customer has filed ASRs to move the affected traffic prior to October 1,
1996, such price increases shall not be effective unless Customer cancels
such ASRs. In addition, Frontier may raise its rates in the Initial States
listed in Amendment #2 to this Agreement dated April 27, 1996 ("Amendment
#2") if Customer has not submitted ASRs for these states by September 1,
1996, upon 15 days notice.
3. The Agreement is hereby amended to eliminate Customer's obligation of
exclusivity with respect to any and all long distance services other than
calling card and 800 PIN traffic. Paragraph 7 of Exhibit 3.1 to the
Agreement (as amended) is hereby deleted in its entirety.
4. Customer and Excel hereby agree that the term of the Agreement be extended
until April 30, 1999 (the "Additional Term"). Such extension shall apply
only to Customer's calling card and 800 PIN endusers as of April 30, 1998
(the "1998 Endusers") and any other traffic remaning on the Frontier
network after April 30, 1998. Rates in effect as of April 30, 1998 shall
remain in effect throughout the Additional Term for 800 PIN and Calling
Card services. After April 30, 1998, Customer may put all new endusers on
any other network, but may not switch the 1998 Endusers until April 30,
1999 unless a change is requested by any 1998 Enduser. Customer shall not
actively promote or market a different platform to the 1998 Endusers during
the Additional Term. Notwithstanding any provisions in earlier amendments
to this Agreement, the parties hereby agree that Customer shall route all
of its calling card and 800 PIN traffic exclusively to the Frontier network
through April 30, 1998.
5. The parties hereby reaffirm Paragraph 6 of Amendment #2 to apply to this
Amendment No. 3.
6. The balance of the Agreement and any executed amendments thereto not
modified by this Amendment remain in full force and effect. The parties
agree that signed facsimile copies of this Amendment may serve as originals
and are binding on the parties.
7. The parties will make public disclosure of this Amendment No. 3, with a
joint press release that is acceptable to both Frontier and Customer.
Frontier Communications Services, Inc. Excel Telecommunications, Inc.
By: /s/ Anthony J. Cassara By: /s/ Kenny A. Troutt
------------------------------ ----------------------------
Title: President Carrier Services Title: President and CEO
-------------------------- -------------------------
Printed Name: Anthony J. Cassara Printed Name: Kenny A. Troutt
------------------- ------------------
Date: June 17, 1996 Date: June 17, 1996
--------------------------- --------------------------
<PAGE>
EXHIBIT 10.5
MCI
CARRIER AGREEMENT
T E R M S A N D C O N D I T I O N S
This Carrier Agreement (the "Agreement"), is between MCI
TELECOMMUNICATIONS CORPORATION ("MCI") and EXCEL TELECOMMUNICATIONS, INC.
("Customer") a resale common carrier subject to the Communications Act of 1934,
as amended by the Telecommunications Act of 1996.
1. Scope of Agreement.
------------------
(a) MCI shall provide to Customer certain specified domestic
interstate services, international services, and intrastate common carriage
services. For domestic interstate and international services, this
Agreement incorporates by reference the terms of MCI Tariff FCC No. 1
("Tariff"), which is on file with the Federal Communications Commission and
which may be modified from time to time by MCI in accordance with law and
thereby affect the services furnished Customer, except that all of the
following terms and conditions of this Agreement shall supplement or, to
the extent inconsistent, supersede Tariff terms and conditions and shall
remain in effect throughout the Service Term (as defined in Paragraph 8).
For intrastate services, this Agreement incorporates by reference each
applicable state tariff filed by MCI, which may be modified by MCI from
time to time, and thereby affect the service(s) furnished Customer. This
Agreement is entered pursuant to Section 211(a) of the Communications Act
of 1934.
(b) Capitalized terms not otherwise defined in this Agreement shall
have the meanings assigned to them in the Tariff.
2. Monthly Commitment.
------------------
(a) During each monthly billing period of the Service Term, after a
four (4) month ramp-up period ("Ramp Period"), Customer's Monthly Usage
shall equal or exceed Five Million Dollars ($5,000,000) per month ("Monthly
Commitment").
Monthly Usage shall mean Customer's domestic interstate and
international usage of the MCI services in Attachment 1 (hereinafter
"Interstate Services" and "International Services") calculated at the rates
set forth in Attachment 1, but not including any applicable taxes (and
gross receipts taxes) and tax-related surcharges on Interstate Services and
International Services. Monthly Usage also includes intrastate usage of
the MCI services in Attachment 1 at standard tariff rates (hereinafter
"Intrastate Services"). Interstate Services, International Services and
Intrastate Services are collectively hereinafter "MCI Services". The rates
for all other MCI products and
MCI CONFIDENTIAL
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services not explicitly contained within this Agreement shall be governed
by the applicable MCI Tariff or applicable state tariff.
(b) After the Ramp Period, if Customer's use of MCI Services is less
than the Monthly Commitment in a month, for that month, Customer will pay
the amount billed plus the difference between the amount billed and the
Monthly Commitment. However, the sum Customer shall pay pursuant to this
Paragraph 2(b) in any month shall not exceed Customer's Monthly Commitment
for that month
(c) During any Quarter (as defined below) in which Customer's total
aggregate Monthly Usage equals or exceeds an amount equal to three (3)
times the Monthly Commitment, Customer shall receive a credit in an amount
equal to any underutilization charges paid under Paragraph 2(b) by Customer
during such Quarter. The credit shall be applied to Customer's domestic
interstate and international invoiced usage charges (excluding taxes,
surcharges and pass-through access/egress (or related) charges) appearing
on Customer's monthly invoice following such Quarter. A Quarter shall be
three (3) consecutive monthly billing periods of the Service Term,
beginning with the month following the end of the Ramp Period.
3. Rates and Additional Terms.
--------------------------
Customer shall pay the rates and charges for MCI Services set forth
in the Attachments and Exhibits to this Agreement and agrees to the additional
terms and conditions set forth in such Attachments and Exhibits. All rates and
charges contained herein shall be applicable during the Ramp Period, without
regard to the Monthly Commitment. Notwithstanding anything herein to the
contrary, all rates and charges provided in this Agreement, including all
Attachments and Exhibits hereto, shall remain effective for the Service Term of
this Agreement, subject to the terms and conditions provided herein. Unless
otherwise provided, rates determined based on Monthly Usage levels shall be
applicable for all usage of the applicable service, and not incrementally (for
example, if Customer's Monthly Usage is above $5,000,000, all Monthly Usage
of domestic interstate MCI PRISM I Service during peak rate periods for such
month shall receive the rate of XXXXXXX per minute as provided in Paragraph
2(a)(1) of Attachment 1).
4. Security.
--------
(a) In the event that Customer fails to make a payment when due under
Paragraph 5, MCI may, in addition to or in lieu of other remedies available
to MCI, require that Customer provide additional security with respect to
Customer's payment obligations hereunder. MCI shall provide Customer ten
(10) days prior written notice of such requirement.
(b) Additional security required by MCI pursuant to Paragraph 4(a)
shall be in the form of a cash deposit or an unconditional letter of credit
in a form and from a bank acceptable to MCI, in an amount
MCI CONFIDENTIAL
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specified by MCI, but not in excess of Customer's previous full month of
Monthly Usage charges, plus an adjustment based on the current month's run
rate to the date MCI provides notice pursuant to the previous sentence. Any
executed letter of credit shall be attached hereto and incorporated by
reference herein and shall be continuously renewed by Customer as necessary
to keep such letter of credit in effect during the Service Term and for a
period of ninety (90) days following the end of the Service Term, unless
all outstanding payment obligations hereunder have been previously
satisfied.
(c) In the event that MCI reasonably requires additional security
pursuant to Paragraph 4(a) and Customer refuses or is unable to provide
such security, or security previously provided by Customer expires, is
terminated or otherwise becomes unavailable and is not immediately replaced
by Customer, MCI may terminate this Agreement for Cause pursuant to
Paragraph 10(a) hereof.
(d) The provisions of this Paragraph 4 shall supersede the provisions
of Section B-7.04 and Section B-11.01 of the Tariff to the extent related
to payment, security deposit requirements, cancellation or termination
provisions relating thereto.
(e) Upon expiration of the Service Term, as defined herein, the
provisions of the Tariff, including Section B-7.04 and Section B-11.01
thereof, shall be applicable and remain in effect so long as Customer
remains a user or has any outstanding balance due for the use of MCI
Services.
5. Payment.
-------
(a)(i) Except as provided in Paragraph 5(b) below, Customer shall pay
MCI for all MCI services provided during the usage month before the last
day of the usage month ("Estimated Payment"). At the initiation of this
Agreement and in every month during the term of this Agreement for which
Customer has elected to make payments pursuant to this Paragraph 5(a)(i),
MCI will provide estimated invoices prior to the 25th day of each month
during the term of this Agreement and Customer will make the Estimated
Payment in the amount of the estimated invoice.
(ii) For each month that Customer pays the amount invoiced within
said usage period as described above, Customer shall receive a discount
equal to XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX of the amount paid (less charges
for installation, taxes, tax-related surcharges, any other applicable
surcharges, charges for access and access-related charges, including,
without limitation, access charges in the tariffs) in such month which
discount shall be applied to Customer's total monthly domestic interstate
and international usage for MCI Services under this Agreement appearing on
the next month's invoice.
(b)(i) As an alternative to the Estimated Payment provisions
contained in Paragraph 5(a) above, Customer may pay MCI for all MCI
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Service(s) provided during a usage month within twenty-five (25) days from
the date of MCI's estimated invoice for charges during such usage month,
which estimated invoice shall be delivered to Customer on the fifth (5th)
day of the month following the usage month ("Estimated Payment").
(ii) If Customer desires to utilize the Estimated Payment method
contained in Paragraph 5(b)(i), it shall provide written notice to MCI
before the first day of the applicable usage month. Similar notice shall
also be required for any subsequent usage month with respect to which
Customer desires to change from the payment option in effect for the
preceding month.
(c) For any usage month for which Customer elects to make the
Estimated Payment as provided in Paragraph 5(a)(i) or 5(b)(i) above, MCI
and Customer will reconcile the Estimated Payment with the MCI invoice
amount for such month within ten (10) days of the date of MCI's invoice.
MCI shall credit any Estimated Payment amount in excess of the MCI invoice
amount for such month on the next available invoice. Immediately after
reconciliation, Customer shall pay MCI any amount the Estimated Payment was
less than the MCI invoice amount for such month.
(d)(i) In the event that a material adverse change in Customer's
financial condition occurs (as described below) during the term of this
Agreement, MCI may, at its reasonable discretion and in addition to or in
lieu of other remedies available to MCI, suspend Customer's ability to
elect the payment options under Paragraph 5(b) of this Agreement. A
material adverse change in Customer's financial condition shall be
determined to have occurred in the event of, a Dun & Bradstreet ratings
downgrade which lowers Customer's rating to 3A4 or less, financial
foreclosures, qualified opinions of public accounting firms, significant
degradations in major financial indices or ratios, or a final,
nonappealable order or decision of a court or regulatory agency which
imposes material liability or damages on Customer or which severely affects
Customer's ability to operate in the same manner as prior to such event.
(ii) In the event that Customer has not made payment for a usage
month in accordance with either Paragraph 5(a)(i) or 5(b)(i) above, MCI may
terminate this Agreement upon ten (10) days written notice, unless Customer
shall have paid such overdue amount to MCI in full prior to the termination
date stated in such notice.
(iii) Customer's failure to make an Estimated Payment for a usage
month in accordance with the method selected by Customer under either
Paragraph 5(a)(i) or 5(b)(i) above, may result in the exercise by MCI of
its rights under the security provisions contained in Paragraph 4,
immediately above, or in such Paragraph as it may be amended during the
Service Term.
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(e) If Customer fails to pay MCI invoiced amounts for charges
actually incurred and which are not properly disputed, as required and MCI
notifies Customer that Customer's CNS service will be terminated for non-
payment, Customer agrees to notify endusers of Customer who receive resold
MCI Carrier Network Services from Customer, of the potential disruption of
service. If Customer fails or refuses to send such notice, MCI may send
such notice in Customer's name, in the form prescribed below. Such letter
shall not be sent in the event that Customer demonstrates to MCI's
reasonable satisfaction that Customer's customers will have been
transitioned to Customer's or another carrier's underlying network as of
the date of termination of service to Customer. If notice to Customer's
endusers is necessary pursuant to this paragraph, such notice shall be in
the form of a letter, signed by Customer or by MCI on behalf of Customer,
to endusers of Customer described above, containing the following language,
mailed after all applicable cure periods, if any, have expired:
Dear [Customer] Enduser:
Unless [Customer] shall have made provision to move your service to
another underlying telecommunications network, [Customer]'s provision
of long distance service to you and our other customers will
terminate within two (2) weeks of the date of this letter. This
letter is being sent to you as a courtesy so that you can make the
necessary arrangements so that you do not experience a disruption of
your communications services. You have a choice of long distance
carriers. If you have any questions, please contact [Customer]
(representative and telephone number) or your local telephone
company.
Sincerely,
Customer
Notwithstanding notice of termination, Customer further agrees that it will
remain responsible for all charges incurred during the period following
transmission of the above-referenced notification and prior to the actual
termination of the service by MCI. In addition, Customer agrees to
maintain customer service for at least a two week period following
transmission of the above-referenced notification.
(f) In the event that MCI sends Customer notice of termination
pursuant to Paragraph 19(a)2) of this Agreement, the provisions of
Paragraphs 5(a) and 5(b) of this Agreement shall cease to be effective and
the terms of this Paragraph 5(f) shall apply during the Transition Period
(as defined in Paragraph 19(a)2)). Customer will pay MCI the charges
applicable under this Agreement for MCI Services provided under this
Agreement by the end of each week. Unless otherwise directed by MCI, such
payments shall be in an amount equal to the amount of the
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previous week's payment, subject to reconciliation with actual usage
charges for such week through inclusion of adjustments in subsequent
invoices.
6. Dispute Resolution.
------------------
Except as otherwise provided herein, any claims arising out of or
related to this Agreement which cannot be resolved by negotiation shall be
settled by binding arbitration in accordance with the rules contained in
MCI Tariff FCC No. 1 ("Arbitration Rules"). Neither party may seek
injunctive relief of any kind prior to the confirmation of an arbitration
award, except that MCI may seek injunctive relief against Customer for
violation of the provisions of Paragraph 19 herein. Any claims made after
one (1) year following the occurrence giving rise to such claims shall be
barred.
7. Termination for Insolvency.
--------------------------
In the event Customer becomes or is declared insolvent or bankrupt,
is the subject of any proceedings related to its liquidation, insolvency or
for the appointment of a receiver or similar officer for it, makes an
assignment for the benefit of all or substantially all of its creditors, or
enters into an agreement for the composition, extension, or readjustment of
all or substantially all of its obligations, MCI may, by giving seven (7)
business days written notice thereof to Customer, terminate this Agreement
without liability or obligation, in whole or in part, as of a date
specified in such notice of termination.
8. Term.
----
(a) The Service Term ("Service Term") shall begin on the first day of
the first month following execution of this Agreement by both parties
("Effective Date") and will continue for a period of twenty-four (24)
months following the end of the Ramp Period, as described in Paragraph 2(a)
of this Agreement.
(b) If Customer's total aggregate actual Monthly Usage hereunder
exceeds XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX prior to
the expiration of the Service Term, Customer may terminate this Agreement
without further liability other than Customer's continuing liability for
accrued but unpaid charges, by providing MCI ninety (90) days prior written
notice.
9. Expiration of Term.
------------------
Upon expiration of the Service Term, Customer shall be fully subject
to all the terms and conditions, including standard tariff rates, set forth
in the Tariff and respective state tariffs for MCI Services received by
Customer after such expiration.
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10. Termination and Termination Liability.
-------------------------------------
(a) MCI may discontinue or terminate all or any portion of Customer's
service under this Agreement for Cause, without incurring any liability.
If Customer terminates this Agreement before expiration of the Service Term
without Cause, as defined below, or MCI terminates this Agreement before
expiration of the Service Term for Cause, Customer will pay MCI within
thirty (30) days of the effective date of such termination, in addition to
all unpaid charges for MCI Services actually provided and any applicable
underutilization charges incurred prior to termination, an amount equal to
fifteen percent (15%) of the aggregate of Customer's remaining Monthly
Commitment for each month remaining in the Service Term after termination
(and a pro rata portion thereof for any partial month) and will repay MCI
the credits received pursuant to Paragraph 3 of Attachment 1 of this
Agreement. Such payments shall be MCI's sole compensation with respect to
MCI's loss of anticipated revenue from the sale of MCI Services to Customer
hereunder resulting from the early termination of this Agreement, but shall
not in any manner restrict MCI's remedies with respect to damages resulting
from any breach of this Agreement by Customer, whether associated with the
early termination of the Agreement or otherwise.
If Customer terminates this Agreement for Cause, Customer will pay to
MCI all unpaid charges for MCI Services actually provided prior to
termination and any applicable underutilization charges accrued prior to
notice of termination. Customer shall not be required to pay for any
shortfalls, penalties, deficiency charges or underutilization charges with
respect to usage of MCI Services after notice of termination under this
paragraph.
For purposes of this Agreement, Cause shall mean:
(i) Customer's failure to make either an Estimated Payment or an
Estimated Payment pursuant to Paragraphs 5(a) and 5(b) of this
Agreement, or to provide security when required pursuant to Paragraph
4 hereof, which failure is not corrected within ten (10) days of
notice of termination sent by MCI;
(ii) the occurrence within any successive period of six (6)
consecutive calendar months during the term of this Agreement of
three (3) or more performance failures described in Paragraph 24 of
this Agreement which are due solely to MCI's actions or inactions and
which do not include failures due to (A) a local exchange carrier or
other provider of access services; (B) acts or omissions of Customer;
or (C) causes beyond the reasonable control of MCI; or
(iii) a failure of either party to perform any other material
obligation or to comply with any other material provision under this
Agreement, which failure is not remedied by the breaching party
within thirty (30) days after receipt of written notice of such
failure from the other party.
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(b) Notwithstanding the requirements of Paragraph 10(a) above, if MCI
makes revisions to any state tariff (other than revisions with respect to
rates, charges, surcharges, penalties, discounts, credits or promotions,
which shall not be subject to this paragraph) in a manner inconsistent with
the nature of such tariff in effect as of the Effective Date of this
Agreement and which materially and adversely affect Customer's purchase of
MCI Services under this Agreement, Customer may, within thirty (30) days of
receiving notice of such tariff change, request that MCI take corrective
action under this paragraph. MCI may, within thirty (30) days of such
request, revise such tariff so as to remedy such adverse effect upon
Customer. If MCI does not institute such tariff revisions, MCI will reduce
the Monthly Commitment provided in this Agreement based upon Customer's
intrastate Monthly Usage in the state in question and in an amount which
reasonably offsets the adverse consequences of such state tariff changes.
If, after sixty (60) days from the date MCI receives Customer's request for
action as described above, MCI has not revised the applicable tariff to
remedy such adverse effect or acted to reduce Customer's Monthly Usage
commitments as described above, Customer may, as its sole remedy, elect to
terminate this Agreement without liability, on thirty (30) days written
notice, given not more than thirty (30) days after the end of the period
during which MCI may take corrective action as described above. Upon such
termination, Customer will pay to MCI all unpaid charges for MCI Services
actually provided prior to termination and any applicable underutilization
charges incurred prior to notice of termination, and will repay MCI the
credits received pursuant to Paragraph 3 of Attachment 1 of this Agreement.
(c) Except where explicitly provided otherwise herein, the provisions
of this Agreement relating to termination of this Agreement shall supersede
the termination provisions contained in Paragraph B-11.10 of the Tariff.
(d)(i) MCI may, without incurring liability, discontinue or terminate
all or any portion of service to Customer's end users who are in violation
of any of the material provisions of this Agreement or the Tariff governing
the use of such service. Except as otherwise provided in this Agreement,
MCI will not discontinue services (either in whole or in part) provided to
Customer under this Agreement until MCI provides written notice to
Customer. Where MCI asserts that the discontinuation of service is
necessary as a result of the actions or inactions of Customer, MCI shall
allow Customer a reasonable opportunity to cure the defect, subject to the
limitations contained in Paragraph 10(a)(iii).
(ii) The prior written notice required in Paragraph 10(d)(i) shall
not apply to discontinuation of service with respect to:
1) National security reasons;
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2) Service interruptions resulting from events of force majeure
or other non-intentional discontinuations such as outages or
interruptions.
3) Discontinuations requested by or consented to by Customer.
4) Emergency repairs or maintenance.
5) Where MCI deems such action necessary to prevent or protect
against fraud or to otherwise protect its personnel, agents,
facilities or services, in which case service may be
discontinued immediately and without notice.
6) If MCI determines that a Toll Free service is being used in
violation of rules and regulations governing use of such
service.
7) As otherwise provided in this Agreement, where termination of
service is permitted following the occurrence of specified
events or the giving of prescribed notices.
(e) Customer shall remain responsible for payment in accordance with
the terms of this Agreement of all charges for services furnished to
Customer under this Agreement, notwithstanding any use, misuse, or abuse of
Customer's service or Customer-provided systems, equipment or facilities or
service interconnected to Customer's service, which use, misuse or abuse
may be occasioned by third parties, including without limitation,
Customer's employees or other members of the public.
11. Nondisclosure.
-------------
(a) Neither party to this Agreement shall disclose to any third party
during the Service Term of this Agreement, or during the three (3) year
period thereafter, any of the terms and conditions set forth in this
Agreement or any other Confidential Information unless such disclosure is
lawfully required by any federal governmental agency or is otherwise
required to be disclosed by law or is necessary in any proceeding
establishing rights and obligations under this Agreement. Unless
specifically ordered to the contrary by any such agency, the party making a
disclosure permitted by the previous sentence shall provide the other party
with written notice of such disclosure and a copy of the disclosed
material. Customer may, to the extent required by securities laws, file a
redacted copy of this Agreement and make additional disclosures regarding
the same pursuant to federal securities laws and generally accepted
accounting principles. Customer will provide the proposed redacted copy of
this Agreement and copies of any other disclosures to MCI for review and
comment prior to filing the same. MCI will use its best efforts to comply
with any reasonable deadlines imposed by Customer for such review and
comment; provided that, in any event, MCI shall be have not less than
forty-eight (48) hours for such purposes. Customer
MCI CONFIDENTIAL
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will exercise its best efforts to obtain confidential treatment of
any information designated by MCI as confidential.
(b) Neither party hereto will, without obtaining the other party's
prior written consent, use the other party's Confidential Information for
any purpose other than for the performance of its duties and obligations
under this Agreement and, in the case of MCI, for the provision of other
services to Customer. MCI shall not disclose any Confidential Information
gained under this Agreement to any of its divisions or affiliates that
market long distance telecommunications services to users similar to
Customer's customers, other than as necessary in the performance of MCI's
duties and obligations hereunder. MCI shall not, in marketing its
services, represent to any third party that MCI is a provider of network
services to Customer.
(c) As used in this Agreement, "Confidential Information" shall mean
all non-public information concerning the business of a party hereto, of
its affiliates, of any customers of Customer, or of any third party doing
business with any of them, that may be obtained by a party by virtue of its
performance or receipt of services under this Agreement. Such Confidential
Information shall include, but shall not be limited to public disclosures
of the existence of this Agreement, the terms of this Agreement (including
discussions, negotiations and proposals from one party to the other
directly related thereto), network designs, tools and programs, pricing,
methods, processes, financial data, software, research, development,
strategic plans, Customer traffic volume or patterns or related
information. All such information disclosed prior to the Effective Date of
this Agreement shall also be considered Confidential Information for
purposes of this Agreement. Confidential Information shall not include
information that: (i) is already rightfully known by the receiving party at
the time it is obtained by such person, free from any obligation to keep
such information confidential; (ii) is or becomes publicly known through no
wrongful act of the receiving party; (iii) is rightfully received by the
receiving person from a third party without restriction and without breach
of this Agreement; or (iv) information equivalent to that described in this
paragraph which is independently developed by a party without the use of
any Confidential Information belonging to the other party.
12. Notices.
-------
All notices, reports and other communications pursuant to or in
connection with this Agreement shall be given by personal delivery,
registered or certified mail (return receipt requested), or courier
service. All such communications shall be addressed to the respective
party at its address shown below:
MCI CONFIDENTIAL
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<PAGE>
<TABLE>
<CAPTION>
If to MCI: If to Customer:
<C> <C>
MCI Telecommunications Corporation Excel Telecommunications, Inc.
205 N. Michigan, Suite 3000 8750 North Central Expressway
Chicago, Il 60601 Suite 2000
ATTN.: Business Markets, Dallas, TX 75231
Legal Affairs ATTN.: Kenny A. Troutt
CC: MCI Account Team CC:
MCI Telecommunications Corporation Excel Telecommunications, Inc.
13155 Noel Road, Suite 1310 8750 North Central Expressway
Dallas, Texas 75240 Suite 2000
ATTN.: Myrna Krug Dallas, TX 75231
ATTN.: Chris Dance
</TABLE>
13. Letter of Agency.
----------------
Customer shall appoint MCI as its agent in the Letter of Agency
attached hereto and incorporated herein as Attachment 3 to this Agreement.
14. Surcharge Exemption.
-------------------
When applicable, Customer shall certify that any special access lines
used in connection with services under this Agreement terminate in a device
not capable of interconnecting MCI's service with the local exchange
network and are surcharge exempt from the special access surcharge.
15. Tax Exemption.
-------------
When applicable, Customer shall certify that it is exempt from
federal, state, and/or local taxes.
16. Governing Law.
-------------
This Agreement, including all matters relating to the validity,
construction, performance and enforcement thereof, shall be governed by the
laws of the State of Texas without giving reference to its principles of
conflicts of law, except to the extent the Communications Act of 1934, as
amended, including by the Telecommunications Act of 1996, and as
interpreted and applied by the Federal Communications Commission, applies.
17. Assignment.
----------
This Agreement shall be binding on Customer and its respective
successors and assigns. Customer may not assign this Agreement, whether by
operation of law or otherwise, without the prior written consent of MCI,
such consent shall not be unreasonably withheld, and any unpermitted
MCI CONFIDENTIAL
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attempted assignment shall be void. In the event that Customer undergoes a
merger involving a change of control, or divests itself of all or a
substantial portion of its telecommunications business or undergoes a
change of more than fifty percent (50%) of its ownership or management, or
leverage or sale occurs involving more than fifty percent (50%) of
Customer's assets or Customer's base, MCI may terminate this Agreement
without liability on one hundred eighty (180) days written notice, given
within thirty (30) days of MCI's receipt of written notice of such event;
provided, that if Customer fails to give MCI prior written notice before
the conclusion of such event, MCI may terminate this Agreement immediately
upon providing Customer written notice of such termination. In the event
MCI gives Customer notice of termination under the preceding sentence of
this Paragraph 17, the Monthly Commitment shall be inapplicable for the
period between the date of such notice and the date of termination and no
termination liability shall be owed by Customer pursuant to Paragraph 10(a)
of this Agreement; provided that MCI shall retain any other remedies
applicable to a breach of this Agreement by Customer.
In the event that MCI undergoes a merger involving a change of control, or
divests itself of all or a substantial portion of its telecommunications
business or undergoes a change of more than fifty percent (50%) of its
ownership or management, or leverage or sale occurs involving more than
fifty percent (50%) of MCI's assets or MCI's base, Customer may terminate
this Agreement without liability on one hundred eighty (180) days written
notice, given within thirty (30) days of Customer's receipt of written
notice of such event
18. No Waiver.
---------
No waiver of any of the provisions of this Agreement shall be binding
unless it is in writing and signed by both parties. The failure of either
party to insist on the strict enforcement of any provision of this
Agreement shall not constitute a waiver of any provision and all terms
shall remain in full force and effect.
19. Carrier Network Service
-----------------------
(a) In order to be eligible to purchase MCI Carrier Network Services
(hereinafter "CNS"):
1) Except in areas where service origination is not available
from access providers via a Carrier Identification Code ("CIC"),
Customer must originate all CNS switched outbound traffic and all CNS
operator services traffic via ANI's PICed to Customer's own CIC.
Customer shall pay all charges associated with the installation and
routing of Customer's CIC in all Local Exchange Carrier ("LEC") end
offices. MCI requires at least sixty (60) days prior written notice
to deactivate or change the translation for sub CIC routing at any end
office and/or tandem. MCI must handle all Authorized Service Requests
(ASRs) submitted to the appropriate
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LEC(s) for MCI's CNS. In addition, Customer shall be financially
responsible for payment of all fees charged by the local exchange
carrier related to the ASRs submitted to modify the sub-CIC routing
and migrate traffic to or from MCI's network, subject to application
of any credits available pursuant to Paragraph 3(a) of Attachment 1 of
this Agreement.
2) Customer shall comply with Section 64.1100 of the FCC's Rules
and Regulations, as well as other applicable laws or regulations
pertaining to the sale and delivery of telecommunications service(s)
to Customer's customers. MCI shall not be liable to Customer's
customers for any claim, liability or expense asserted by those
customers in connection with Customer's sale or delivery of such
service(s), including the unauthorized conversion of a customer's
Primary Interexchange Carrier ("PIC") designation to Customer's CIC.
In the event Customer violates any FCC or other applicable law or
regulation pertaining to the sale or delivery of Customer's
service(s), MCI may terminate this Agreement on not less than five (5)
days written notice. Following such termination, Customer will be
permitted no more than ninety (90) days to transition Customer's
existing telecommunications service off of the MCI network and to
other service provider(s) (the "Transition Period"), subject to
Customer's compliance with the payment provisions set forth in
Paragraph 5(f) of this Agreement. In the event that Customer fails to
comply with the payment terms set forth in Paragraph 5(f), the
Transition Period will immediately end without further notice and MCI
shall have the right to immediately terminate further service to
Customer. The provisions of this Agreement (including rates provided
herein) shall remain in effect during such Transition Period, except
that: (i) during such Transition Period, MCI shall be under no
obligation to accept orders for services from Customer; (ii) the
provisions of Paragraphs 2 (with respect to Monthly Commitment
obligations), 5(a), 5(b), 10 (with respect to rights of Customer to
terminate Agreement), 22, 24, and Paragraph 3 of Attachment 1 (with
respect to any unapplied credits) of this Agreement shall not continue
in effect during the Transition Period; and (iii) MCI shall incur no
liability to Customer through MCI's provision of services to Customer
during the Transition Period except as provided in the Tariff. In the
event MCI gives Customer notice of termination under the preceding
sentence of this Paragraph 19(a)2), no termination liability shall be
owed by Customer pursuant to Paragraph 10(a) of this Agreement;
provided that MCI shall retain any other remedies applicable to a
breach of this Agreement by Customer. In addition, Customer shall
indemnify and hold MCI harmless from any actions, claims, suits or
damages arising out of Customer's violation or alleged violation of
any FCC or other applicable law or state regulation, and Customer
shall pay all attorney fees and costs incurred by MCI in connection
with such actions, claims, suits or damages.
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3) Customer agrees that it will obtain and maintain any and all
approvals to resell MCI Carrier Network Service hereunder from the
FCC, including requirements imposed by Section 214 of the
Communications Act of 1934, as amended, and state regulatory bodies.
In the event Customer fails to obtain or maintain the appropriate
approvals, MCI shall not be liable for any delay or failure to provide
CNS.
4) Customer agrees to sell and bill MCI Carrier Network Service
under its own name, identity or mark, and Customer further agrees not
to reference MCI's name or marks in any context involving its
furnishing of services to the public. If any violation occurs during
the Service Term of this Agreement, MCI may invoke the termination
provisions of Paragraph 19(b). In reselling MCI Services under this
Agreement, Customer will observe the highest standard of integrity and
fair dealing with members of the public. Furthermore, Customer agrees
to indemnify MCI for any actions, claims, suits or damages arising out
of any allegation that if proved would cause Customer to be in breach
of this provision and Customer shall also pay all reasonable
attorney's fees and costs incurred by MCI due to any actions, claims,
suits or damages arising out of such allegation.
5) Except as set forth in Paragraph 5 herein, Customer shall
have sole responsibility for interacting with its customers in all
matters pertaining to service, including the placing and handling of
service orders, service installation, operation and termination,
dispute handling and resolution, and billing and collection matters.
MCI shall incur no obligation, nor shall it be deemed to have any
obligation, to interact with Customer's customers for any reason or
purpose. Customer shall cooperate with MCI as necessary to address
and resolve service-related issues and problems and shall impose upon
its customers an obligation to cooperate, with Customer in addressing
and resolving service-related issues and problems.
(b) Without limitation, if Customer fails to abide by the
requirements in Paragraph 19(a) above, such failure shall be regarded as a
material breach of this Agreement and MCI may terminate this Agreement on
five (5) business days written notice. Following such termination,
Customer shall be permitted the Transition Period pursuant to the terms set
forth in Paragraph 19(a)2).
(c) Customer agrees that MCI may use an appropriate internal MCI
database to determine Working Telephone Number ("WTN") historical data
regarding MCI and non-MCI PICs and Customer understands that such systems
are not error free. MCI will not be liable to Customer for errors made in
determining WTN in reliance on information contained in the internal MCI
system.
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(d) Customer understands and accepts that, as part of MCI's
normal business policy and practices and its obligations under law, MCI
will engage in extensive marketing efforts in attempt to sell its services
to the public and that such efforts will result in active competition with
Customer for the business of users who are Customer's customers or
prospects. Customer shall not complain, nor be heard to complain, of
business lost to MCI as a result of such competition, subject to compliance
with Paragraph 11(b) of this Agreement. Under no circumstance shall any
inference be derived that MCI's entry into this Agreement with Customer
means that MCI will restrict its efforts to compete against Customer in any
way.
(e) Customer understands and accepts that no fiduciary
relationship arises by virtue of this Agreement and that, accordingly, MCI
incurs none of the obligations that arise in such relationship as an
incident of its fulfilling its obligations under this Agreement. Further,
Customer understands and accepts that MCI is not an insurer of profits for
Customer, nor does MCI guarantee the success of Customer's business as a
result of Customer's receipt of services under this Agreement.
(f) Customer agrees that if its enduser makes a call using 10XXX
or 1+ access utilizing Customer's CIC, from an ANI which Customer did not
provide to MCI to enter into MCI's Billing and Order Entry systems, MCI
will bill the call through the LEC at MCI Tariff or applicable state tariff
rates, and MCI's name will appear as the service provider on the LEC
invoice. Furthermore, Customer agrees its sales and marketing channels will
only market 10XXX access as a dialing option from ANIs that the end-user
had PIC'd to the Customer's CIC, in areas where the Customer's CIC is
pointed to MCI for termination.
Carrier Identification Parameter (CIP) will be made available to
Customer if MCI determines, at its sole discretion to move forward with CIP
implementation. CIP allows the appropriate local exchange carrier to pass
the Carriers Identification Code in the call record. If MCI implements CIP,
Customer shall receive all CDRs from 10XXX dialing on Customer's CIC,
whether or not a call originates from an ANI subscribed to Customer where
Customer's CIC is translated to MCI's CIC at the appropriate LEC.
(g) Customer shall receive Call Traffic Records pursuant to
Exhibit A of this Agreement.
20. ANI Management Responsibilities.
-------------------------------
On or before the thirtieth (30th) day after the close of the billing cycle,
MCI will provide Customer with a list of ANIs, including traffic minutes
and number of calls associated with ANIs associated with Customer's CNS
Account ("MCI Active ANI List"). If Customer has not received the MCI
Active ANI List within thirty (30) days after the close of the billing
cycle, Customer must immediately notify MCI. Within thirty (30) days after
Customer's receipt of the MCI Active ANI List,
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Customer shall provide to MCI, in writing, a report ("Customer ANI Report")
of all ANIs in the billing cycle covered by the MCI Active ANI List that
were either: (1) ordered by Customer to be added by MCI to the Customer's
account, but which were not added to Customer's CNS Account; or (2) on the
MCI Active ANI List but which Customer had requested be deleted; or (3)
experienced zero (0) or significantly reduced usage, but which were
suspected to have no reductions in usage. Customer shall provide MCI with
documentation establishing the ordering and deletion of each ANI contained
in the Customer ANI Report. For any ANI not timely included by Customer in
the Customer ANI Report: (1) Customer shall be liable to MCI for usage
charges associated with said ANI; and (2) MCI shall not be liable to
Customer for any costs, claims or damages resulting from failure to
implement Customer's directions with respect to said ANI.
21. Detention Facilities.
--------------------
In order to be eligible for use of MCI Carrier Network Services in
conjunction with the provision of communications services to any detention
facility, including, but not limited to, any local, state or federal
prison:
(a) Customer shall provide MCI prior written notice on each occasion
that Customer subscribes to CNS at a detention facility. Notice to MCI
shall be provided at :
MCI Telecommunications Corporation
MCI Carrier Finance Manager
Six Concourse Parkway
Atlanta, GA 30328
(b) Customer agrees after the Effective Date of this Agreement, but
not more than once semi-annually, MCI may request, and Customer shall
promptly provide to MCI in writing or in a machine readable format as
specified by MCI, Customer's records, data and invoices pertaining to
Customer's total long distance telecommunications usage for each Customer
detention facility end-user for the most recent six (6) month period
preceding the request.
(c) MCI in its sole discretion and consistent with Section B-7.04 of
MCI Tariff FCC No. 1 and in specific implementation of such Tariff
provision, may require Customer, as a condition precedent to receipt of MCI
Carrier Network Service to detention facilities as defined above, to
provide within ten (10) days of executing this Agreement, or any time
thereafter, a cash deposit or letter of credit in a form acceptable to MCI
in an amount equal to up to three (3) month's estimated billing. Any
executed letter of credit shall be attached hereto and incorporated by
reference. Customer shall continuously renew any letter of credit as
necessary to keep it in effect during the service term.
MCI CONFIDENTIAL
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<PAGE>
(d) Notwithstanding any other provisions of the Tariff, Customer
shall remain responsible for payment of all charges for services furnished
to Customer, which responsibility is not changed by virtue of any use,
misuse, or abuse of Customer's service or Customer-provided systems,
equipment, facilities or service interconnected to Customer's service,
which use, misuse or abuse may be occasioned by third parties including
without limitation, Customer's employees or other members of the public.
(e) Customer will comply with applicable federal, state and local
laws and regulations, including without limitation, laws and regulations
relating to operator service as they pertain to detention facilities during
the term of this Agreement and as supported by Carrier Operator Services.
22. Fraud monitoring.
----------------
MCI shall monitor on a twenty-four (24) hour, seven (7) day a week,
basis Customer's use of the following MCI Carrier Network Services:
(i) 800 Service calls originating in the continental (48) United
States.
(ii) Outbound switched international traffic terminating in
international locations.
(iii) Outbound dedicated international traffic terminating in
international locations.
These services shall hereinafter be referred to as "Analyzed
Services". Analyzed Services exclude calling card traffic and 10XXX
traffic.
MCI shall continuously analyze the call detail data of Analyzed
Services to detect suspicious calling patterns. Some of the criteria and
features applied and available are as follows:
(i) Analyze traffic occurring from Customer billing numbers and
switched trunk combinations.
(ii) Near real time information for analysis on a twenty-four (24)
hour, seven (7) day a week, basis.
(iii)Analyze originating calling line information (CLI phone
classifications) displayed on MCI system via individual call
detail. Examples of CLI phone classifications are prison
payphone, COCOT, hospitals, etc.
(iv) Established risk factors for calls terminating in high fraud
areas.
MCI CONFIDENTIAL
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<PAGE>
The following traffic types are excluded from the above analysis:
(i) Point of sale transaction traffic.
(ii) Beeper and pager company traffic.
MCI analysis systems are based on traffic data and do not require
special equipment at an Installation Site.
MCI shall monitor traffic of Analyzed Services on a twenty-four (24)
hours a day, seven (7) days a week basis.
When a calling pattern exceeds one (1) or more of the parameters
established by MCI as provided above, MCI shall, within twenty-four (24)
hours, notify Customer via telephone and in writing via facsimile. MCI
shall provide prompt and reasonable assistance to Customer to investigate
the occurrence and determine whether such calls were fraudulent and shall
take reasonable action upon Customer's direction.
23. Limitation of Liability.
-----------------------
Except as otherwise provided in this Paragraph 23 and in Attachment 2
to this Agreement with respect to MCI Carrier Operator Services, MCI's
total liability arising as a result of its provision of services under this
Agreement shall be governed in all respects by the Tariff.
MCI's total liability to Customer arising from its provisioning of
call detail records under Exhibit A to this Agreement or RELI Service under
Exhibit G to this Agreement shall be limited to the lesser of (a)
Customer's proven direct damages or (b) the total amount paid by Customer
to MCI for CDR or RELI services, as applicable, during the one (1) month
period prior to the event giving rise to the cause of action. The
foregoing limitation applies to all causes of actions and claims, including
without limitation breach of contract, breach of warranty, negligence,
strict liability, misrepresentation and other torts. Further, no cause of
action with respect to MCI's provisioning of call detail records or RELI
service which arose more than one (1) year prior to the institution of a
legal proceeding alleging such cause of action may be asserted by either
party against the other.
Neither MCI nor Customer shall be liable to each other for indirect,
incidental, consequential, exemplary, reliance or special damages,
including damages for lost profits, regardless of the form of action
whether in contract, indemnity, warranty, strict liability, or tort,
including negligence of any kind, with regard to MCI Services or other
conduct under this Agreement.
MCI CONFIDENTIAL
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<PAGE>
24. Performance Criteria.
--------------------
(a) Subject to the terms and conditions of this Agreement and any
applicable tariffs, MCI shall provide Customer the services described in
this Agreement in accordance with the following criteria:
(i) MCI will create a daily call detail record (CDRs) file for completed
calls with respect to Customer's usage of MCI CNS Service, which shall
be available 365 days a year, with respect to calls up to 48 hours
old, barring unforeseen delays in receiving call records from
appropriate switches. CDRs will be maintained by MCI in tape format
for 90 days and in microfiche or other archive storage medium for 7
years.
(ii) After Customer has first achieved the Monthly Commitment, MCI's
systems shall have the capability of processing at least four million
(4,000,000) CDRs per day for Customer.
(iii)Order entry and activation of ANIs within MCI's systems will occur:
(A) within twenty-four (24) hours for MCI CNS Service orders which do
not require conversions or features (i.e., accounting codes and
verifiable accounting codes); and (B) within five (5) days for
switched MCI Toll Free Service with respect to new Toll Free orders
(i.e., other than orders provided by Customer's Resp. Org.); excluding
in both instances Sundays and nationally recognized holidays.
(iv) MCI's fraud management system shall be capable of initiating "fast
kill" and "restoral" orders within thirty (30) minutes of notice from
Customer (verbal notice to be immediately followed by written notice).
(v) MCI will provide 7 day per week, 24 hour per day coverage of MCI
technical administrative functions as provided by MCI's Carrier
Account Service Center.
(vi) MCI will act on MCI priority 1 service restoral objectives within four
(4) hours from the time MCI receives notice of such event.
(vii)Call blockage on MCI's shared voice switch network shall not exceed
one call per hundred for a period of longer than twenty-four (24)
hours.
(b) Failure to comply with any of the provisions of Paragraph 24(a)
above shall constitute a "performance failure" for purposes of Paragraph
10(a)(ii) of this Agreement, except that no performance failure shall be
deemed to have occurred:
(i) if such failure is cured by MCI within forty-eight (48) hours of
MCI's receipt of notice of such failure and no additional failure
of such type shall occur within the seven (7) day
MCI CONFIDENTIAL
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<PAGE>
period following the cure of the initial failure (provided,
however, that multiple failures of such type during a seven (7)
day period shall not constitute more than one performance
failure, so long as MCI exercises reasonable diligence in the
correction of such failures);
(ii) if such failure is due to (A) a local exchange carrier or other
provider of access services; (B) acts or omissions of Customer;
or (C) causes beyond the reasonable control of MCI;
(iii)if because of force majeure, MCI is unable wholly or in part to
carry out any of its obligations under this Paragraph 24 for a
period of up to five (5) days; provided that such obligations
shall be suspended for the duration of the event of force
majeure. The term "force majeure" as used herein shall include
switch, radio or cable failure, cable cut caused by a party other
than MCI or its agents, acts of God, riots, insurrection, war,
labor dispute of third parties other than MCI or its agents,
fire, flood, explosion, orders or acts of military or civil
authority, and any other cause beyond MCI's reasonable control.
25. Entire Agreement; Amendments.
----------------------------
This Agreement shall be valid only if signed by Customer by June 21,
1996. Any and all prior or contemporaneous offers, agreements,
representations and understandings made to Customer, whether written or
oral, are hereby superseded. Exclusive of any Tariff or state tariff
modifications initiated by MCI, once this Agreement has been executed, any
amendments hereto must be made in writing and signed by both parties.
MCI CONFIDENTIAL
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<PAGE>
IN WITNESS WHEREOF, the parties hereto each acting with proper authority have
executed this Agreement.
MCI TELECOMMUNICATIONS CORPORATION
By: /s/ Tom Schilling
------------------------------------
Print Name: Tom Schilling
----------------------------
Title: Director
---------------------------------
Date: June 26, 1996
----------------------------------
EXCEL TELECOMMUNICATIONS, INC.
By: /s/ Kenny A. Troutt
------------------------------------
Print Name: Kenny A. Troutt
----------------------------
Title: President and CEO
---------------------------------
Date: June 24, 1996
----------------------------------
MCI CONFIDENTIAL
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<PAGE>
ATTACHMENT 1
1. Carrier Network Service Rates.
------------------------------
Customer shall receive the following rates during the Service Term for MCI
Services that do not originate at a switch owned and operated by Customer.
Rates set forth in this Paragraph 1 do not include charges for
installation, taxes, tax-related surcharges, any other applicable
surcharges, charges for access and access related surcharges associated
with dedicated CNS. Rates are in lieu of any discounts, promotions, and
credits otherwise applicable pursuant to the Tariff unless otherwise
provided in this Agreement. In addition, the CNS Toll Free Service Fees in
Option F, Section C.3.0812 (or any successor Tariff section) of the Tariff
shall be waived with respect to each toll free number having at least
XXXXXXXXXXXXXXXXXXXXXXXX of associated Monthly Usage charges for such
month.
When referenced below, for CNS inbound and outbound Interstate and
International Services, "Tariff Rates" shall mean the standard Tariff rates
for Option G and Option F in the Tariff.
(a) Interstate Outbound and Inbound Toll Free Rates. For CNS interstate
outbound services, excluding service terminating in Alaska, Hawaii, Puerto
Rico and the U.S. Virgin Islands, and for CNS interstate inbound toll free
service, excluding services originating in Alaska, Puerto Rico, the U.S.
Virgin Islands and Hawaii, Customer shall pay the following non-distance
sensitive "postalized" rate per minute as determined by Customer's overall
Monthly Usage. Customer shall not be eligible for any tariff discount on
these services.
<TABLE>
<CAPTION>
CNS Domestic Non-Dedicated
--------------------------
Interstate Outbound
-------------------
Monthly Usage Day Rate Non-Day Rate
------------- -------- ------------
<S> <C> <C>
XXXXXXXXXXXXXXX XXXXXXXXXXXX XXXXXXXXXXXX
XXXXXXXXXX XXXXXXX XXXXXXX
</TABLE>
MCI CONFIDENTIAL
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<PAGE>
Day Rate periods shall be 8:00 a.m. to 4:59 p.m., Monday through Friday.
For CNS Domestic Non-Dedicated Interstate Outbound monthly usage, Customer
will receive a credit each month of: (i) XXXXXX per Non-Day minute if the
Non-Day CNS Domestic Non-Dedicated Interstate Outbound usage meets or
exceeds XXXXXXXXXXXXXXXXXXX, but is less than XXXXXXXXXXXXXXXXXXX of total
CNS Domestic Non-Dedicated Interstate Outbound usage; and, (ii) XXXXXX per
Non-Day minute if the Non-Day CNS Domestic Non-Dedicated Interstate
Outbound usage meets or exceeds XXXXXXXXXXXXXXXXXXX of total CNS Non-
Dedicated Outbound usage.
<TABLE>
<CAPTION>
CNS Domestic Non-Dedicated
Interstate Inbound Toll Free
----------------------------
Monthly Usage Day Rate Non-Day Rate
------------- -------- ------------
<S> <C> <C>
XXXXXXXXXXXXXXX XXXXXXXXXXXX XXXXXXXXXXXX
XXXXXXXXXXXX XXXXXXX XXXXXXX
</TABLE>
For CNS Domestic Non-Dedicated Interstate Inbound Toll Free usage, Customer
will receive a credit each month of XXXXXXX per Non-Day minute if the Non-
Day CNS Domestic Non-Dedicated Interstate Inbound Toll Free usage meets or
exceeds XXXXXXXXXXXXXXXXXXX of total CNS Domestic Non-Dedicated Interstate
Inbound usage.
<TABLE>
<CAPTION>
CNS Domestic Dedicated
Interstate Inbound Toll Free
----------------------------
Monthly Usage Outbound Rate Inbound Rate
------------- ------------- ------------
<S> <C> <C>
XXXXXXXXXXXXXXX XXXXXXXXXXXX XXXXXXXXXXXX
XXXXXXXXXXXX XXXXXXX XXXXXXX
</TABLE>
(b) Interstate Outbound - Extended Call Coverage for Alaska, Puerto Rico, the
U.S. Virgin Islands and Hawaii. For CNS interstate outbound services
terminating in Alaska, Hawaii, Puerto Rico or the U.S. Virgin Islands, and
for CNS interstate outbound services originating in Hawaii, Customer will
pay the following rates: (i) a postalized Day rate of XXXXXXX per minute;
and, (ii) a postalized Non-Day rate of XXXXXXX per minute, provided that if
Customer's CNS
MCI CONFIDENTIAL
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<PAGE>
Interstate Outbound traffic in minutes from the U.S. mainland, Alaska and
Hawaii to Alaska and Hawaii exceeds XXXXXXXXXXXXXXXXX of total CNS
Interstate outbound traffic, then Customer will pay tariff rates less a
XXXXXXXXXXXXXXXXXXXX discount, and no other tariff discounts will apply.
CNS domestic interstate outbound service calls can not originate from
Alaska, Puerto Rico or the U.S. Virgin Islands.
(c) Interstate Inbound Toll Free - Extended Call Coverage for Alaska, Puerto
Rico, the U.S. Virgin Islands and Hawaii. For CNS interstate services
originating in Alaska, Puerto Rico, the U.S. Virgin Islands and Hawaii,
Customer shall pay interstate rates at the Toll Free Business Line
Termination or Dedicated Termination rates in Option F, Section C.3.082 of
the Tariff (or any successor Tariff section) less a XXXXXXXXXXXXXXXXXXXX
discount. Customer is not eligible for any Tariff discounts on such
service.
(d) Intrastate Outbound Rates.
(i) For CNS intrastate, non-dedicated outbound services, Customer
shall pay standard tariff rates as set forth in each applicable MCI state
tariff. Customer shall receive a credit on such usage equal to the difference
between the applicable state tariff rates and the rates for each state set forth
on Exhibit B, though such credits may only be applied to Customer's interstate
and international CNS usage in the same month that the credits are generated.
Such credits will not exceed the amount of Customer's interstate and
international CNS usage and any credit that is not applied in the month accrued
will expire and not be carried forward.
(ii) For CNS intrastate dedicated outbound services, Customer shall
pay the applicable state tariff rate. Customer will receive a credit equal to
XXXXXXXXXXXXXXXXXXXXXXXXX of Customer's usage of CNS intrastate dedicated
outbound service under applicable state tariff rates, though such credits may
only be applied to Customer's CNS interstate and international usage in the same
month that the credits
MCI CONFIDENTIAL
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<PAGE>
are generated. Such credits will not exceed the amount of Customer's interstate
and international CNS usage and any credit that is not applied in the month
accrued will expire and not be carried forward.
(iii) Customer shall not be eligible for any tariff discounts on CNS
intrastate outbound services.
(e) Intrastate Inbound Toll Free Rates.
(i) For CNS intrastate, non-dedicated inbound toll free services,
Customer shall pay standard tariff rates as set forth in each applicable MCI
state tariff. Customer shall receive a credit on such usage equal to the
difference between the applicable state tariff rates and the rates for each
state set forth on Exhibit C, though such credits may only be applied to
Customer's interstate and international CNS usage in the same month that the
credits are generated. Such credits will not exceed the amount of Customer's
interstate and international CNS usage and any credit that is not applied in the
month accrued will expire and not be carried forward.
(ii) For CNS intrastate, dedicated inbound toll free services,
Customer shall pay the applicable state tariff rate. Customer will receive a
credit equal to XXXXXXXXXXXXXXXXXXXXXXXXX of Customer's usage of CNS intrastate,
dedicated inbound toll free service under applicable state tariff rates, though
such credits may only be applied to Customer's CNS interstate and international
usage in the same month that the credits are generated. Such credits will not
exceed the amount of Customer's interstate and international CNS usage and any
credit that is not applied in the month accrued will expire and not be carried
forward.
(iii) Customer shall not be eligible for any tariff discount on CNS
intrastate inbound toll free service.
(f) Intralata Outbound Rates. For CNS intralata outbound service, where MCI
provides Vnet tariff intralata service, Customer shall pay standard tariff
rates for MCI Vnet intralata service (switched to switched, switched to
MCI CONFIDENTIAL
-4-
<PAGE>
dedicated and dedicated to switched) in each applicable MCI state tariff.
Customer is not eligible for any tariff discounts on such service. For CNS
intralata outbound service in the states listed below, Customer will
receive a credit on such usage equal to the difference between the
applicable state tariff rates and the rates set forth below. For CNS
intralata outbound service in states not listed below, Customer shall
receive a credit equal to XXXXXXXXXXXXXXXXXXXXXXXXX of the applicable
tariffed intralata rate. All such credits may only be applied to Customer's
CNS interstate and international usage in the same month that the credits
are generated. Such credits will not exceed the amount of Customer's
interstate and international CNS usage and any credit that is not applied
in the month accrued will expire and not be carried forward.
<TABLE>
<CAPTION>
State Switched Dedicated
----- -------- ---------
Rate Per Minute Rate Per Minute
--------------- ---------------
PEAK OFF-PEAK PEAK OFF-PEAK
---- -------- ---- --------
<S> <C> <C> <C> <C>
Alabama XXX XXX XXXXXX XXXXXX
California XXXXXX XXXXXX XXXXXX XXXXXX
Florida XXXXXX XXXXXX XXX XXX
Illinois XXXXXX XXXXXX XXXXXX XXXXXX
Iowa XXXXXX XXXXXX XXX XXX
Kentucky XXXXXX XXXXXX XXX XXX
Maryland XXXXXX XXXXXX XXXXXX XXXXXX
Massachusetts XXXXXX XXXXXX XXXXXX XXXXXX
New Jersey XXXXXX XXXXXX XXXXXX XXXXXX
New York XXXXXX XXXXXX XXXXXX XXXXXX
Tennessee XXXXXX XXXXXX XXX XXX
</TABLE>
"N/A" in the foregoing table signifies that intrastate rates otherwise
applicable under this Agreement shall be applicable for such calls.
(g) International Dedicated and Non-Dedicated Outbound Rates. For CNS
international non-dedicated outbound service to those countries listed in
Exhibit D, Customer shall pay the rates in Exhibit D. Exhibit D shall
supersede Exhibit E for those countries listed in both exhibits. Customer
shall not be eligible for tariff discounts on such usage. For CNS
MCI CONFIDENTIAL
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<PAGE>
international non-dedicated outbound service to those countries listed in
Exhibit E, Customer shall pay the rates listed in Exhibit E, less a XXXXXX
XXXXXXXXXXXXX discount, though Customer will not be eligible for any tariff
discount. MCI may, no more often than once every twelve (12) months,
revise the country rates listed on Exhibit D and Exhibit E to compensate
for changes in costs associated with service to those countries. For CNS
international non-dedicated outbound service to a country which does not
have rates listed in either Exhibit D or in Exhibit E, Customer will pay
international rates at the Tariff Rates in Option G Section 3.0739 less
applicable tariff discounts. For international dedicated outbound service,
Customer shall pay a rate equal to the non-dedicated rate to the same
country as set forth above, plus an additional XXXXX per minute.
(h) CNS International Outbound Terminating in Mexico. For CNS international
outbound service terminating in Mexico, Customer shall pay a postalized
rate per minute which shall be determined according to the Band (as defined
in MCI's Tariff FCC No. 1) in Mexico where the call terminates, and whether
the call is placed at Standard or Economy times, as set forth in the
following Schedule. Customer is not eligible for any Tariff discounts on
such service.
<TABLE>
<CAPTION>
Rate Per Minute
Band Standard Economy
---- -------- -------
<S> <C> <C>
1 XXXXXXX XXXXXXX
2 XXXXXXX XXXXXXX
3 XXXXXXX XXXXXXX
4 XXXXXXX XXXXXXX
5 XXXXXXX XXXXXXX
6 XXXXXXX XXXXXXX
7 XXXXXXX XXXXXXX
8 XXXXXXX XXXXXXX
</TABLE>
For purposes of this Paragraph 1(h), "Standard" rate periods are as defined
in the Tariff (currently 7:00 a.m. to 6:59 p.m., Monday through Friday, and
7:00 p.m. to 11:59 a.m., Sunday). "Economy" rate periods include all other
periods.
MCI CONFIDENTIAL
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<PAGE>
(i) CNS International Outbound Terminating in Canada. For CNS international
outbound service terminating in Canada, Customer shall pay a postalized
rate per minute of XXXXXXX per minute during peak times and a postalized
rate per minute of XXXXXXX at off peak times.
(j) International Dedicated and Non-Dedicated Toll Free Rates. For CNS
international non-dedicated toll free service, Customer shall pay the
international toll free rates at the standard Tariff non-dedicated rates in
Option F, Section C.3.07314 (or any successor Tariff section) less a
discount of XXXXXXXXXXXXXXXXXXXX. For CNS international dedicated toll
free service, Customer shall pay the International Non-Dedicated toll free
rates less a discount of XXXXXXXXXXXXXXXXXXXX and less a further discount
of XXXXX per minute. Customer is not eligible for any Tariff discounts on
such service.
(k) Directory Assistance. For switched to switched and dedicated to switched
directory assistance, Customer shall pay XXXXX per call.
(l) High Telco Costs. On a monthly basis, for CNS, MCI shall determine, based
on the following formula, Customer's minutes of use originating from or
terminating to the specific local exchange carriers identified in Schedule
B in Exhibit F for the following traffic types ("LEC Minutes"):
. CNS international, interstate, intrastate and intralata outbound
switched to switched and switched to dedicated; and
. CNS interstate, intrastate and intralata inbound switched to switched.
For the same CNS traffic types above, MCI shall determine, based on the
provisions of this Paragraph 1(l), the total CNS minutes of use originating
from or terminating to the United States, Puerto Rico and the U.S. Virgin
Islands regardless of the originating and terminating local exchange
carrier. These minutes of use shall include all originating and
MCI CONFIDENTIAL
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<PAGE>
terminating minutes and shall be referred to as "Total Minutes."
If LEC Minutes exceed XXXXXXXXXXXXXXXXXXXX of Total Minutes ("XXX Cap") in
any XXXXX, Customer shall pay the per minute surcharge listed in Schedule A
of Exhibit F in such XXXXX for each LEC Minute (determined on a
chronological basis) that exceeds the XXX Cap based on the local exchange
carrier territory in Schedule B of Exhibit F in which the call originates
and/or terminates. The per minute surcharges listed in Schedule A of
Exhibit F shall apply to each switched end of the call originating or
terminating in the LECs listed in Schedule B of Exhibit F. For example, for
a CNS outbound interstate switched to switched minute originating in a
XXXXXX area served by XXXXXXX and terminating in a XXXXXXXXX area served by
XXXXXX Tel, Customer shall pay a per minute surcharge of XXXXXX (XXXXXX
plus XXXXXX).
The per minute surcharge shall be calculated by multiplying the applicable
per minute surcharge in Schedule A of Exhibit F by the percentage exceeding
the XXX Cap times the minutes of the phone call. For example, assuming
Customer has XXXXX Total Minutes with XXX LEC Minutes (this equals XXX LEC
Minutes with XXX or XXXXXXXXXXXXXXX of the LEC Minutes exceeding the XXX
Cap), the per minute surcharge for a XX minute CNS switched to switched
call originating in the XXXXXXXXXXXXXXXXX Telco Region and terminating in
the XXXXXXXXX Telco Region would be calculated as follows:
XXXXXXXXXXXXXXXXX x XXX x XX minutes = XXXXXXX surcharge for this
call.
(m) RELI. Customer shall receive the rates, terms and conditions for MCI's
RELI Service as set forth in Exhibit G.
2. Additional Rates.
----------------
Customer shall receive the following rates during the Service Term for MCI
Services which outbound traffic originates and inbound terminates at a switch
owned and operated by Customer. Customer shall pay standard tariff rates for all
Intrastate Services.
MCI CONFIDENTIAL
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<PAGE>
Rates set forth in this Paragraph 2 do not include charges for installation,
taxes, tax-related surcharges, any other applicable surcharges, charges for
access and access-related charges (including, without limitation, access charges
in the Tariff, which are additional) except as otherwise provided in Paragraphs
2(f) herein. Rates are in lieu of any discounts, promotions, and credits
otherwise applicable pursuant to the Tariff and any state tariff.
(a) Domestic Interstate MCI PRISM I Service.
---------------------------------------
(1) For domestic interstate switched outbound service originating via
dedicated access from a Customer-owned location(s) to an MCI point of
presence, except for service terminating to Alaska, Hawaii, Puerto Rico,
and the U.S. Virgin Islands for which Customer shall pay Tariff rates less
applicable Tariff discounts, Customer will pay the following applicable
non-distance sensitive ("postalized") rate per minute as determined by
Customer's Monthly Usage:
<TABLE>
<CAPTION>
Rate Per Minute
Monthly Usage Peak Off Peak
------------- ---- --------
<S> <C> <C>
XXXXXXXXXXXXXXXX XXXXXX XXXXXX
XXXXXXXXXXXXXXXXXXXX XXXXXXX XXXXXXX
</TABLE>
(2) On a monthly basis, if Customer's total minutes of use of domestic
interstate Prism I traffic terminating to those local exchange carriers
listed in Schedule B of Exhibit F exceeds XXXXXXXXXXXXXXXXXXXXX of
Customer's total domestic interstate Prism I traffic, then Customer will
pay the surcharges set forth in Schedule A of Exhibit F in addition to
those charges on such traffic set forth in Paragraph 2(a)(1), above.
(b) Domestic Interstate MCI Toll Free DAL Service.
---------------------------------------------
1) For domestic interstate inbound service terminating via dedicated
access from an MCI point of presence to Customer-owned location(s), except
for service originating from Alaska, Hawaii, Puerto Rico and the U.S.
Virgin Islands
MCI CONFIDENTIAL
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<PAGE>
for which Customer shall pay Tariff rates less applicable Tariff discounts,
Customer will pay the following non-distance sensitive ("postalized") rate per
minute for domestic interstate MCI Toll Free DAL Service which originates in the
48 contiguous United States:
<TABLE>
<CAPTION>
Rate Per Minute
Monthly Usage Peak Off Peak
------------- ---- --------
<S> <C> <C>
XXXXXXXXXXXXXXXX XXXXXX XXXXXX
XXXXXXXXXXXXXXXXXXXX XXXXXXX XXXXXXX
</TABLE>
2) The above rates for MCI Toll Free DAL Service do not include any
feature charges described in the Tariff, including, but not limited to, any
Toll Free Service Management System ("SMS") charges or RESP ORG charges,
which may be additional. Except as provided below, Customer shall pay
Tariff rates for feature charges associated with MCI Toll Free DAL Service.
For the features identified below, Customer shall pay rates set forth,
except that for each Corporate I.D., Customer shall pay a maximum of:
XXXX per month, per Corporate I.D. for monthly recurring charges.
XXXX per month, per Corporate I.D. for non-recurring installation charges.
XXXX per month, per Corporate I.D. for non-recurring change order charges.
<TABLE>
<CAPTION>
Feature Monthly Install Changes
- ------- ------- ------- -------
<S> <C> <C> <C>
Point of Call Routing XXXXXX XXXXXX XXXXXX
Most Available Agent Routing XXXXXX XXXXXX XXXXXX
Day of Week Routing XXXXXX XXXXXX XXXXXX
MCI Rules Based Routing XXXXXX XXXXXX XXXXXX
Time Interval Routing XXXXXX XXXXXX XXXXXX
Tailored Call Coverage XX XXXXXXX XXXXXX
Holiday Routing XX XXXXXXX XXXXXX
MCI Profile Routing XXXXXX XXXXXX XXXXXX
MCI Quota Routing XXXXXX XXXXXX XXXXXX
DNIS XX XXXXXXX XXXXXX
Percentage Allocation Routing XXXXXX XXXXXX XXXXXX
</TABLE>
MCI CONFIDENTIAL
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<PAGE>
Id Codes (per 100) XXXXXX XXXXXX XX
Sequential Allocation Routing XXXXXX XXXXXX XXXXXX
3) On a monthly basis, if Customer's total minutes of use of
domestic interstate toll free traffic originating with those local exchange
carriers listed in Schedule B of Exhibit F exceeds XXXXXXXXXXXXXXXXXXXXX of
Customer's total domestic interstate toll free traffic, then Customer will
pay the surcharges set forth in Schedule A of Exhibit F in addition to
those charges on such traffic as set forth above.
(c) Domestic Interstate TDS 1.5.
---------------------------
For domestic interstate TDS 1.5 Service ("TDS 1.5 Service")
terminating at Customer's owned and operated switch locations, Customer
will pay, in addition to all taxes and tax-related surcharges, the Inter-
Office Channel ("IOC") monthly charges based on circuit mileage as
contained in the schedule below, less a XXXXXXXXXXXXXXXXX discount.
Customer shall pay both the charges in Column A plus those in Column B.
<TABLE>
<CAPTION>
A B
Fixed Charge Charge Per DS-O
Circuit Mileage Per Circuit Circuit Mile
--------------- ----------- ---------------
<S> <C> <C>
0 to XX miles XXXXXXX XXXXX
XX to XX miles XX XXXXXXX
XXX to XXX miles XX XXXXXXX
XXX + miles XX XXXXXXX
</TABLE>
(d) Domestic Interstate TDS-45.
--------------------------
For domestic interstate TDS-45 Service ("TDS-45 Service") terminating
at Customer's owned and operated switch locations, Customer will pay, in
addition to all taxes and tax-related surcharges, the IOC monthly charges
based on circuit mileage as contained in the schedule below, less a XXX
XXXXXXXXXXXXX discount. Customer shall pay both the charges in Column A
plus those in Column B. Provision of TDS-45 service to Customer shall be
subject to service availability as determined by MCI.
MCI CONFIDENTIAL
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<PAGE>
<TABLE>
<CAPTION>
A B
Fixed Charge Charge Per DS-O
Circuit Mileage Per Circuit Circuit Mile
--------------- ------------ ---------------
<S> <C> <C>
XXXXXXX XXXXXX XX
XXXXXXXXXXXXX XXXXXX XXXXXXX
</TABLE>
(e) Domestic Interstate DS-O.
------------------------
For domestic interstate DS-O Service ("DS-O Service") terminating at
Customer's owned and operated switch locations, Customer will pay, in
addition to all taxes and tax-related surcharges, the IOC monthly charges
based on circuit mileage as contained in the schedule below, less a XXX
XXXXXXXXXXXXX discount. Customer shall pay both the charges in Column A
plus those in Column B.
<TABLE>
<CAPTION>
A B
Fixed Charge Charge Per DS-O
Circuit Mileage Per Circuit Circuit Mile
--------------- ------------ ---------------
<S> <C> <C>
XXXXXXX XXXXXX XX
XXXXXXXXXX XX XXXXX
XXXXXXXXXXXXX XX XXXXX
</TABLE>
(f) 1) All monthly recurring Central Office Connection ("COC") and monthly
recurring Access Coordination ("AC") charges for domestic interstate TDS
1.5 Service, TDS-45 Service and DS-O Service are included in the charges
for these services.
2) Rates for domestic interstate TDS 1.5 Service, TDS-45 Service and
DS-O Service are based on a least mileage routing and the mileage per route
is determined by using the airline mileage between the two applicable MCI
Dedicated Leased Line cities in accordance with the calculation as set
forth in Section C-11, Table I, Part A of the Tariff. These rates shall
apply only to circuits that are wholly-owned and operated end-to-end by MCI
and the rates shall not apply to circuits with less than XXXXXXXXXXXXXXXXX
domestic interstate traffic.
MCI CONFIDENTIAL
-12-
<PAGE>
3) The rates for domestic interstate TDS 1.5 Service, TDS-45 Service
and DS-O Service provided herein are in lieu of any rates, charges,
promotions and discounts available from MCI in the Tariff or applicable
state tariff for the AC, COC and IOC portion of such service including,
without limitation, the Network Pricing Plan(s) specified in the Tariff.
4) Monthly recurring Local Loop Access charges for domestic
interstate TDS 1.5 Service, TDS-45 Service and DS-O Service shall not count
towards Customer's Monthly Commitment.
(g) City Pair Discount For Private Line.
------------------------------------
In addition to the rates for TDS 1.5 and TDS-45 Service set forth
above, Customer will receive a discount on its domestic interstate IOC
charges for multiple TDS 1.5 and TDS-45 circuits which are installed at the
same time between city pairs pursuant to the following schedule:
Number of TDS 1.5 or TDS-45
Circuits in City Pair Discount
--------------------- --------
XXXXX XX
XXXXXX XX
XXXXXXXXXXXX XX
(h) MCI Feature Card Service.
------------------------
Customer will receive the rates, terms and conditions for MCI Feature
Card Service set forth in Exhibit H.
(i) MCI Carrier Operator Services.
-----------------------------
Customer will receive the rates, terms and conditions for MCI Carrier
Operator Services as set forth in Attachment 2 to this Agreement and the
Exhibit(s) to such Attachment.
(j) MCI VIP, VIP Plus, Toll Free MOD and CAS Plus Discounts.
-------------------------------------------------------
MCI CONFIDENTIAL
-13-
<PAGE>
1) For MCI PRISM I Services for which postalized rates or rates
otherwise modified by discounts in this Agreement are not provided herein,
Customer is entitled to receive the discounts associated with the thirty-
six (36) month term commitment under the MCI PRISM I Service Value
Insurance Plan ("VIP") and the MCI Corporate Account Service ("CAS") Plus
plan subject to the terms and conditions set forth in the Tariff for such
services except as modified by this Agreement. In the event Customer
terminates this Agreement, Customer will be billed any applicable Tariff
early termination charges associated with the plan which Customer received.
MCI agrees to waive Tariff termination liability under the VIP and CAS Plus
if Customer's termination occurs after twenty-four (24) months. Customer's
termination liability hereunder is in addition to Customer's termination
liability provided for in Paragraph 10 of the Agreement.
2) For MCI International Toll Free DAL Service for which postalized
rates or rates otherwise modified by discounts in this Agreement are not
provided herein, Customer is entitled to receive the discounts associated
with the thirty-six (36) month term commitment under the MCI Toll Free
Service Value Insurance Plan Plus ("VIP Plus") subject to the terms and
conditions set forth in the Tariff for such services except as modified by
this Agreement.
In the event Customer terminates this Agreement, Customer will be
billed any applicable Tariff early termination charges associated with the
plan which Customer received. MCI agrees to waive Tariff termination
liability under the VIP Plus if Customer's termination occurs after twenty-
four (24) months. Customer's termination liability hereunder is in addition
to Customer's termination liability provided for in Paragraph 10 of the
Agreement.
3) For MCI International Toll Free DAL Service, Customer is entitled
to receive the MCI Toll Free Service Multi-Option Discount ("800 MOD")
subject to the terms and conditions set forth in the Tariff for such
service except as modified by this Agreement.
MCI CONFIDENTIAL
-14-
<PAGE>
4) In the event the amount of the discount provided under VIP, VIP
Plus, CAS Plus, and/or 800 MOD is greater than the charges for Customer's
usage of Interstate and International Services earned under this Agreement,
the difference will not be credited to Customer or carried forward.
3. Credits and Additional Discounts.
--------------------------------
(a) CNS Installation Credit
-----------------------
Customer shall receive a credit of up to XXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXX, which shall be applied to the one-time installation
(including CIC installation) and other one-time non-recurring MCI Tariff
charges associated with the implementation of Carrier Network Services.
Customer may use this credit to off set per ANI PIC fees assessed by the
LEC's, up to XXXXXXXXXXXXXXXXXXXX per ANI.
(b) Access Coordination/Central Office Connection Promotion
-------------------------------------------------------
As a promotional offering to Customer for executing this Agreement on
or before the date specified in Paragraph 22 of the Agreement, Customer
shall pay MCI a monthly recurring Central Office Connection charge of XXX
XXXXXXXXXXXXXXXXXXXXXX per circuit and a monthly recurring Access
Coordination charge of XXXXXXXXXXXXXXXXXXX per circuit for MCI T-1 digital
gateway access circuits installed prior to the Effective Date of this
Agreement and currently utilized by Customer, and for MCI T-1 digital
gateway access circuits installed pursuant to this Agreement. Such charges
shall be in effect for the term of this Agreement, after which Customer
shall pay standard Tariff rates less applicable Tariff discounts for such
circuits.
MCI CONFIDENTIAL
-15-
<PAGE>
ATTACHMENT 2
MCI CARRIER OPERATOR SERVICES
With respect to Customer's purchase of MCI Carrier Operator Services for resale,
the parties hereby agree as follows:
1. Operator Services.
-----------------
(a) MCI will provide Carrier Operator Services for Carrier Network
Services customers only when such customer's end user's access lines are
provided by one of the LECs listed in Exhibit A to this Attachment 2 which
is attached hereto and incorporated herein by reference.
(b) "Operator Service Calls" mean long distance calls dialed with the 0+,
01+ or 00- dialing pattern (and excluding calls dialed with the 950-XXXX
and 800 dialing patterns).
(c) Customer shall not use any service mark or trademark of MCI or refer
to MCI in connection with any service provided hereunder without the prior
written approval of MCI.
(d) Call Originating Identification Information. MCI must receive
-------------------------------------------
electronic call origination identification ANI information for each call
carried hereunder. If the Originating Site uses Feature Group D local
access service, the required call origination identification information
is automatically supplied by the local exchange company. If the
Originating Site uses a type of local access service other than Feature
Group D local access service, the Originating Site shall cause electronic
call origination identification information (in a form acceptable to MCI)
to be supplied to MCI at the initiation of each call.
(e) Emergency Calls.
---------------
(1) Each Originating Site shall configure its system so that 911
emergency calls, where available, and similar emergency calls, will be
automatically routed to the appropriate party or clearing house
without the intervention of MCI. Emergency calls which do reach a
MCI CONFIDENTIAL
-1-
<PAGE>
MCI operator shall be handled in accordance with MCI standard
operating procedures.
(2) If Customer or MCI provides an emergency number database,
Customer agrees to indemnify and hold MCI harmless from any and all
claims, damages, fines, penalties and any other liabilities (including
attorney fees) arising out of the inaccuracy of any information or the
inadequacy of any procedure or personnel.
(f) Payphones.
---------
(1) Payphone lines must be classed as "07" COCOT.
(2) All payphones must have Billed Number Screening ("BNS"), if
available. If BNS is not available, the Customer will be
responsible for calls billed to any lines without BNS.
(3) Unless otherwise permitted by law, all 0- calls must be passed to
the Local Exchange Carrier ("LEC").
(4) Payphones must not block 950-XXXX or 1-800-XXX-XXXX calls.
(5) All payphones must have "011" blocking at the central office, if
available. If international blocking is not available, or if
Customer chooses not to block "011" calls, then Customer assumes
responsibility for any international fraud.
(6) For Premises Telephones located in condominiums, Customer shall be
liable for all charges attributable to the failure of Customer to
secure screening which prevents 1+ 10XXX domestic and
international dialing and which indicates to operators that the
telephone is restricted to prohibit billing to the original ANI.
MCI CONFIDENTIAL
-2-
<PAGE>
(7) Customer shall be responsible for any fraud resulting from its
purchase and use of MCI Carrier Operator Services.
(g) Compliance. Customer will comply with applicable federal, state and
----------
local laws and regulations, including without limitation the Telephone
Operator Consumer Services Improvement Act, and other laws and regulations
relating to operator service during the term of this Agreement.
(h) Authority. Customer warrants that it is authorized to select the
---------
operator services carrier for the telephones served by Customer pursuant
to this Agreement. Customer agrees that if any party makes any claims
against MCI for commissions from such telephones, Customer will be
responsible for any such claim.
(i) Liability.
---------
Except in cases involving proven willful or wanton misconduct, MCI's
liability to Customer under this Attachment 2 is limited to its obligation
to provide service as described herein. MCI SHALL NOT BE LIABLE FOR ANY
INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, OR PUNITIVE LOSS OR DAMAGE OF
ANY KIND, INCLUDING LOST PROFITS OR REVENUE (WHETHER OR NOT MCI WAS AWARE
OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE), BY REASON OF ANY ACT OR
OMISSION IN ITS PERFORMANCE UNDER THIS AGREEMENT.
Customer shall indemnify and hold MCI harmless against any and all
claims, losses, liabilities, damages, fines, penalties, costs or expenses
(including reasonable attorneys' fees and expenses) arising out of or
related to (A) Customer's actions or inactions under this Attachment 2,
except to the extent caused by MCI's proven willful or wanton misconduct,
(B) the inaccuracy of any information or the inadequacy of any procedures
or personnel provided by Customer under this Attachment 2, or (C) any claim
made under Paragraph 1(h) of this Attachment 2.
MCI CONFIDENTIAL
-3-
<PAGE>
2. Rates.
-----
(a) The rates in the following schedule shall be charged on Customer's
usage of MCI Carrier Operator Services. The automated rate will be charged
from the time a call reaches a node until the call is terminated. The live
rate will be charged in addition to automated rates for the portion of each
call that is handled by a live operator.
<TABLE>
<CAPTION>
Automated Live
Monthly Attempts Rate/Sec. Rate/Sec.
---------------- --------- ---------
<S> <C> <C>
0 - XXXXXX XXXXXXXX XXXXXXXX
XXXXXXXXXXXXXXXX XXXXXXXX XXXXXXXX
XXXXXXXXXXXXXXXXX XXXXXXXX XXXXXXXX
XXXXXXXXXXXXXXXXX XXXXXXXX XXXXXXXX
XXXXXXXXXXXXXXXXXXX XXXXXXXX XXXXXXXX
XXXXXXXXXXXXXXXXXXXXX XXXXXXXX XXXXXXXX
XXXXXXXXXX XXXXXXXX XXXXXXXX
</TABLE>
(b) For calls terminated by MCI, Customer shall pay MCI an additional
charge for call termination based on the Domestic Interstate MCI PRISM I
call minimum and call rounding as stated in the Tariff. For calls
terminated on dedicated access, Customer shall pay the PRISM I domestic
interstate outbound rate specified in Paragraph 2(a) of Attachment 1. For
calls terminated on switched access, Customer shall pay the Carrier
Network Services Domestic non-dedicated interstate outbound rate specified
in Paragraph 1(a) of Attachment 1.
3. Rate Quotes. If Customer has provided the appropriate rate information, MCI
-----------
will provide real-time rate quotes to callers.
4. Customer Service. Customer agrees that all customer service calls (i.e.,
----------------
billing disputes, troubles, general inquiries) shall be routed to
Customer's customer service via a Customer-provided MCI 800 number.
5. Language Assistance. Customer agrees that if, on a monthly basis, calls
--------------------
utilizing MCI Carrier Operator Services language
MCI CONFIDENTIAL
-4-
<PAGE>
assistance exceed XXXXXXXXXXXXXXXXXXXX, Customer shall pay two times the
Tariff rate for all calls exceeding XXXXXXXXXXXXXXXXXXXX.
6. Brand. Customer agrees that it will resell MCI Carrier Operator Services
-----
in its own name only.
7. Service Delivery. Customer agrees that it will receive and deliver all MCI
----------------
Carrier Operator Services calls from/to one of the three (3) MCI automated
nodes via an MCI TDS-1.5 circuit, TDS-45 circuit or Carrier Network
Services shared access.
8. Billing. Customer agrees to be responsible for all end-user billing for
-------
operator services and further agrees that if MCI provides rating and/or
recording services for billing, Customer shall indemnify MCI to the extent
provided in Paragraph 1(i) of this Attachment 2.
9. Call Detail Records. Call Detail Records ("CDR's) for MCI Carrier Operator
-------------------
Services are available to Customer on a next day basis. Customer assumes
responsibility for pulling the CDR's from the Carrier Operator Services
Bulletin Board. Records will only be posted to the bulletin board for ten
(10) days from the date of call.
10. Forecasting. Customer agrees to provide a written monthly forecast for
-----------
automated and live MCI Carrier Operator Services to be received by MCI no
later than ten (10) days prior to the beginning of each month.
11. Force Majeure. If because of force majeure, MCI is unable wholly or in
-------------
part to carry out any of its obligations under this Attachment 2 for a
period of up to five (5) days, such obligations shall be suspended for the
duration of the event of force majeure. During the continuance of such
force majeure, MCI shall incur no liability by reason of its failure to
perform the obligation so suspended, provided, however, that the disabling
effect of such force majeure shall be eliminated as soon as and to the
extent reasonably possible. The term "force majeure" as used herein shall
include switch, radio or cable failure, cable cut caused by a
MCI CONFIDENTIAL
-5-
<PAGE>
party other than MCI or its agents, acts of God, riots, insurrection, war,
labor dispute of third parties other than MCI or its agents, fire, flood,
explosion, orders or acts of military or civil authority, and any other
cause beyond MCI's reasonable control.
-6-
<PAGE>
EXHIBIT A
TO ATTACHMENT 2
LEC'S ELIGIBLE FOR CNS OPERATOR SERVICES RATES
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX TX
XXXXXXXXXXXX XXXXXXXXXXXX AR
XXXXXXXXXXXXXXX XXXXXXXX IL
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX NC
XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXX PA
XXXXXXXXXXXXXXX XXXXXXXX GA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX TN
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX KY
XXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX PA
XXXXXXXXXXX XXXXXXXXXXXXX PA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXX LA
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX OH
XXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX OH
XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX CT
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX VA
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX GA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX PA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX PA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX LA
XXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX TX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX WA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX SC
XXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX TX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX MO
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXX NE
XXXXXXXXXXXXXXXXXXXXX XXXXXXX TX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXX TX
XXXXXXXXXXXXXXXXXX XXXXXX AL
XXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX SC
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX TN
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXX SC
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX IL
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX TX
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX SC
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX NC
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX NE
MCI CONFIDENTIAL
<PAGE>
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXX TX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX MN
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXX AK
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX WI
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX TN
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX PA
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX NC
XXXXXXXXXXX XXXXXXXXX NY
XXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX NY
XXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXX CA
XXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX OK
XXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX WA
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX NY
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX SC
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX CA
XXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX VA
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXX IN
XXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXX XXXXXXXX KY
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX CT
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX TX
XXXXXXXXXXXX XXXXXXXXX KS
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXX FL
XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX GA
XXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX NY
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX IL
XXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX MS
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX NC
XXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXX CT
XXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX TN
XXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXX CO
XXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX NY
XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXX WI
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXX NC
MCI CONFIDENTIAL
-44-
<PAGE>
ATTACHMENT 3
LETTER OF AGENCY
----------------
ATTENTION: Concerned Local Operating Companies, AT&T and other Common Carriers
and All Equipment Vendors
The undersigned appoints MCI Telecommunications Corporation or any of its
affiliated companies ("MCI") as agent for the purpose of ordering, in connection
with MCI's provision of service to the undersigned, changes in and/or
maintenance on specific telecommunications service that you provide to the
undersigned including, without limitation, removing, adding to or rearranging
such telecommunications service.
You are hereby released from any and all liability for making pertinent
information available to MCI and for following MCI's instructions with respect
to any changes to or maintenance on the undersigned's telecommunications
service. You may deal directly with MCI on all matters pertaining to
telecommunications service and should follow instructions with respect thereto.
This authorization will remain in effect until modified or rescinded in writing
by the undersigned.
Signed this _______ day of ___________, 19___.
BY:
- -----------------------------
Authorized Customer Signature
- -----------------------------
Title
- -----------------------------
Company Name
MCI CONFIDENTIAL
-45-
<PAGE>
EXHIBIT A
CALL TRAFFIC RECORDS
A. Call Detail Records
Customer may select between weekly magnetic tapes or daily files to receive call
detail record ("CDR(s)") information and may also choose to receive monthly
magnetic tapes. Customer may choose ONE of these options (weekly magnetic tapes
or daily files), but not both, by providing MCI written notice thereof.
Customer may change the selected option during the Service Term of the Agreement
by providing MCI with ninety (90) days prior written notice. Daily CDRs are
available only for Carrier Network Service Interstate, Intrastate and
International Outbound usage. Weekly and monthly magnetic tapes are available
for Carrier Network Services Interstate, Intrastate and International Outbound
and Inbound usage. If CDRs are made available by MCI on a more frequent basis
or in a different format, Customer shall be entitled to receive CDRs in such
manner, under such terms and conditions as MCI may impose with respect to such
newly available frequency of delivery or format.
The above tapes and files shall be provided to Customer in MCI format and at
applicable Tariff and state tariff rates. MCI makes no guarantee that such tape
or file is compatible with any billing systems Customer may choose to use.
Further, MCI assumes no obligation to conform the magnetic tape or file format
to become compatible with any billing system of Customer or Customer's billing
agent.
B. Weekly Magnetic Tapes
Customer may receive CDRs from MCI on a weekly basis via magnetic tape in the
same record layout format as the MCI monthly billing magnetic tape.
Weekly magnetic tapes consist of and feature the following:
1. Customer shall receive one magnetic tape for each of the following
products: Carrier Network Services Interstate, Intrastate and
International Outbound; Carrier Network
MCI CONFIDENTIAL
A-1
<PAGE>
Services Interstate, Intrastate and International Inbound; and Operator
Services. MCI will use reasonable efforts to provide this tape(s) to Customer
one (1) week after the usage occurs. The traffic period contained in the
magnetic tape varies in accordance to the type of usage as stated in the table
below:
<TABLE>
<CAPTION>
TYPE OF USAGE CALL TRAFFIC PERIOD
------------- -------------------
<S> <C>
Outbound Saturday through Friday
Inbound Friday through Thursday
Calling Card Wednesday through Tuesday
</TABLE>
Due to timing of the extract, the tape may not contain complete data for the
week. The remaining data for such days will be contained in the following
week's tape.
2. Based on the nature of weekly magnetic tape processing, traffic may be
in "Error Suspense", defined as the failure to process a record due to lack of
current account information. Error Suspense is due to (a) the timeliness of
order entry reference file extracts and (b) traffic rate table updates.
Normal Error Suspense accounts for approximately one percent (1%) of total
traffic for a given week and will appear on a later tape with the original date
of the call specified.
3. For invoicing cycles ending mid-week (i.e. the 31st day of the month is
a Wednesday), two (2) magnetic tapes will be generated for that week; one for
the traffic for the prior month's invoicing cycle and one for traffic for the
current invoicing period. This will allow Customer to reconcile the weekly
tapes to its monthly invoice.
4. Each new ANI may incur up to a two (2) week delay prior to appearing in
the weekly magnetic tape process. MCI order entry file updates occur on the
first (1st) and fifteenth (15th) of each month and produce extracts to weekly
magnetic tape processes. For example, ANIs installed May 20, will not appear on
the weekly magnetic tape until after May 30.
5. The weekly magnetic tape service is a value-added product and is
provided for fraud detection purposes only.
MCI CONFIDENTIAL
A-2
<PAGE>
MCI shall have no obligation to research or track any discrepancies between
monthly magnetic tape and the weekly call detail records (but MCI may elect
to do so, in its sole discretion).
6. MCI will use the monthly magnetic tape to invoice Customer.
7. Customer is responsible for paying the monthly invoice in full
inaccordance with the terms specified in this Agreement, regardless of any
discrepancies between the monthly invoice and the weekly magnetic tapes.
C. Daily CDRs
Daily CDRs are only available for outbound usage. The daily CDR feature will be
unedited by MCI's billing system and unaudited by MCI's billing center to
ensure timeliness of delivery. MCI will not be liable to Customer for any errors
or inaccuracies contained in the daily CDRs.
1. Daily CDRs are prepared as follows:
(a) An extract is taken of calls from MCI's call processing system
prior to monthly invoice preparation and MCI will use reasonable efforts to
provide the tape to Customer within forty-eight hours after traffic is
created (ie, calls that are placed Monday will be in the file sent on
Wednesday, although calls made early Monday may appear in Tuesday's file).
(b) Files will be received seven (7) days per week at a time to be
mutually determined by the parties.
(c) Two (2) data delivery options will be available for selection by
Customer based on Customer's forecasted volume. Any and all expenses
incurred to set up any dedicated line, hardware, software or other
equipment that may be required for data delivery shall be paid by the
Customer.
MCI CONFIDENTIAL
A-3
<PAGE>
2. MCI does not assume responsibility for failures in delivery of CDR data
which are caused by Customer's billing and customer premise equipment. MCI will
store files for up to fourteen (14) days in case a retransmission is requested,
after which all files will be purged.
3. Due to Error Suspense, as defined in paragraph B.2, not all calls will
necessarily appear on the file specific to their date; calls may actually appear
on a later file but the call will retain the original date.
4. Customer understands that daily CDR delivery is subject to the following:
(a) The record format will be identical to monthly magnetic tape except
that it will not contain the amount charged for the call.
(b) Daily CDRs will not always correspond with the monthly file for the
following reasons:
(i) records do not complete the full billing process and may get dropped
as "unbillable" when the full billing process is completed.
(ii) Error Suspense, as defined in paragraph B.2, could result in calls
from previous dates being delivered in daily files. Normal Error Suspense
accounts for approximately one percent (1%) of total traffic.
(iii) calls can be recycled for ninety (90) days until they are either
invoiced or dropped in the invoice editing process.
(c) Call traffic can experience up to a two (2) week delay prior to
appearing in the daily file process. This only occurs when ANI's added to a new
account or Corporate ID which has been established within two weeks of when the
ANI was tied to this new account via MCI's order entry system.
(d) File creation is time driven (i.e., data is distributed at
approximately the same time each day
MCI CONFIDENTIAL
A-4
<PAGE>
regardless of whether all files have been received from all data centers).
Therefore, some files on given days could be incomplete with the remainder of
data received on the following day's file. The file header shall indicate if all
data was obtained from each of the three (3) MCI data centers.
(e) MCI shall have no obligation to research or track any discrepancies
between the daily and monthly files. Customer shall pay pursuant to the monthly
invoice, regardless of any discrepancies between the monthly invoice and the
daily files.
MCI CONFIDENTIAL
A-5
<PAGE>
EXHIBIT B
CNS NON-DEDICATED OUTBOUND INTRASTATE RATES
-------------------------------------------
Day Non-Day
Alabama XXXXXXXX XXXXXXXX
Arizona XXXXXXXX XXXXXXXX
Arkansas XXXXXXXX XXXXXXXX
California XXXXXXXX XXXXXXXX
Colorado XXXXXXXX XXXXXXXX
Connecticut XXXXXXXX XXXXXXXX
Delaware XXXXXXXX XXXXXXXX
Florida XXXXXXXX XXXXXXXX
Georgia XXXXXXXX $XXXXXXX
Idaho XXXXXXXX XXXXXXXX
Illinois XXXXXXXX XXXXXXXX
Indiana XXXXXXXX XXXXXXXX
Iowa XXXXXXXX XXXXXXXX
Kansas XXXXXXXX XXXXXXXX
Kentucky XXXXXXXX XXXXXXXX
Louisiana XXXXXXXX XXXXXXXX
Maine XXXXXXXX XXXXXXXX
Maryland XXXXXXXX XXXXXXXX
Massachusetts XXXXXXXX XXXXXXXX
Michigan XXXXXXXX XXXXXXXX
Minnesota XXXXXXXX XXXXXXXX
Mississippi XXXXXXXX XXXXXXXX
Missouri XXXXXXXX XXXXXXXX
Montana XXXXXXXX XXXXXXXX
Nebraska XXXXXXXX XXXXXXXX
Nevada XXXXXXXX XXXXXXXX
New Hampshire XXXXXXXX XXXXXXXX
New Jersey XXXXXXXX XXXXXXXX
New Mexico XXXXXXXX XXXXXXXX
New York XXXXXXXX XXXXXXXX
North Carolina XXXXXXXX XXXXXXXX
North Dakota XXXXXXXX XXXXXXXX
Ohio XXXXXXXX XXXXXXXX
Oklahoma XXXXXXXX XXXXXXXX
Oregon XXXXXXXX XXXXXXXX
Pennsylvania XXXXXXXX XXXXXXXX
Rhode Island XXXXXXXX XXXXXXXX
South Carolina XXXXXXXX XXXXXXXX
South Dakota XXXXXXXX XXXXXXXX
Tennessee XXXXXXXX XXXXXXXX
Texas XXXXXXXX XXXXXXXX
MCI CONFIDENTIAL
B-1
<PAGE>
<TABLE>
<S> <C> <C>
Utah XXXXXXXX XXXXXXXX
Vermont XXXXXXXX XXXXXXXX
Virginia XXXXXXXX XXXXXXXX
Washington XXXXXXXX XXXXXXXX
West Virginia XXXXXXXX XXXXXXXX
Wisconsin XXXXXXXX XXXXXXXX
Wyoming XXXXXXXX XXXXXXXX
</TABLE>
MCI CONFIDENTIAL
B-2
<PAGE>
EXHIBIT C
CNS NON-DEDICATED INBOUND INTRASTATE RATES
------------------------------------------
<TABLE>
<CAPTION>
Day Non-Day
--- -------
<S> <C> <C>
Alabama XXXXXXXX XXXXXXXX
Arizona XXXXXXXX XXXXXXXX
Arkansas XXXXXXXX XXXXXXXX
California XXXXXXXX XXXXXXXX
Colorado XXXXXXXX XXXXXXXX
Connecticut XXXXXXXX XXXXXXXX
Delaware XXXXXXXX XXXXXXXX
Florida XXXXXXXX XXXXXXXX
Georgia XXXXXXXX XXXXXXXX
Idaho XXXXXXXX XXXXXXXX
Illinois XXXXXXXX XXXXXXXX
Indiana XXXXXXXX XXXXXXXX
Iowa XXXXXXXX XXXXXXXX
Kansas XXXXXXXX XXXXXXXX
Kentucky XXXXXXXX XXXXXXXX
Louisiana XXXXXXXX XXXXXXXX
Maine XXXXXXXX XXXXXXXX
Maryland XXXXXXXX XXXXXXXX
Massachusetts XXXXXXXX XXXXXXXX
Michigan XXXXXXXX XXXXXXXX
Minnesota XXXXXXXX XXXXXXXX
Mississippi XXXXXXXX XXXXXXXX
Missouri XXXXXXXX XXXXXXXX
Montana XXXXXXXX XXXXXXXX
Nebraska XXXXXXXX XXXXXXXX
Nevada XXXXXXXX XXXXXXXX
New Hampshire XXXXXXXX XXXXXXXX
New Jersey XXXXXXXX XXXXXXXX
New Mexico XXXXXXXX XXXXXXXX
New York XXXXXXXX XXXXXXXX
North Carolina XXXXXXXX XXXXXXXX
North Dakota XXXXXXXX XXXXXXXX
Ohio XXXXXXXX XXXXXXXX
</TABLE>
MCI CONFIDENTIAL
C-1
<PAGE>
<TABLE>
<S> <C> <C>
Oklahoma XXXXXXXX XXXXXXXX
Oregon XXXXXXXX XXXXXXXX
Pennsylvania XXXXXXXX XXXXXXXX
Rhode Island XXXXXXXX XXXXXXXX
South Carolina XXXXXXXX XXXXXXXX
South Dakota XXXXXXXX XXXXXXXX
Tennessee XXXXXXXX XXXXXXXX
Texas XXXXXXXX XXXXXXXX
Utah XXXXXXXX XXXXXXXX
Vermont XXXXXXXX XXXXXXXX
Virginia XXXXXXXX XXXXXXXX
Washington XXXXXXXX XXXXXXXX
West XXXXXXXX XXXXXXXX
Virginia
Wisconsin XXXXXXXX XXXXXXXX
Wyoming XXXXXXXX XXXXXXXX
</TABLE>
MCI CONFIDENTIAL
C-2
<PAGE>
EXHIBIT D
CNS INTERNATIONAL OUTBOUND RATES
--------------------------------
Country Code Rate/Minute
XXXXXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXXXXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXXXX XXX XXXXXX
XXXXXXXXXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXXXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXXXXX XXX XXXXXX
XXXXXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXXX XXX XXXXXX
XXXXXXXXXXXXXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
XXXXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXXX XXX XXXXXX
MCI CONFIDENTIAL
D-1
<PAGE>
<TABLE>
<S> <C> <C>
XXXXXXXXXXX XXX XXXXXX
XXXXXXXXXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXX XXX XXXXXX
XXXXXX XXX XXXXXX
XXXXXXXXXX XXX XXXXXX
XXXXXXXXXXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
XXXXXXXXXXXX XXX XXXXXX
XXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
XXXXXXXXXXX XXX XXXXXX
XXXXXXXXXXXXXXX XXX XXXXXX
XXXXXXXXX XXX XXXXXX
</TABLE>
MCI CONFIDENTIAL
D-2
<PAGE>
EXHIBIT E
CNS INTERNATIONAL OUTBOUND RATES
--------------------------------
- --------------------------------------------------------------------------------
PEAK OFF-PEAK
------------------------------------------------------
COUNTRY 1st XX Add'l 1st XX Add'l
Secs X Secs Secs X Secs
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
MCI CONFIDENTIAL
E-6
<PAGE>
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
XXXXXXXXXXXXXXXXXXXX XXXXXX XXXXXX XXXXXX XXXXXX
- --------------------------------------------------------------------------------
<PAGE>
EXHIBIT F
SCHEDULE A
PER MINUTE SURCHARGE
<TABLE>
<CAPTION>
Telco Region Originating Terminating
- ------------ ----------- -----------
<S> <C> <C>
Southwestern Bell Territory XXXXXX XXXXXX
Bell South Territory XXXXXX XXXXXX
Pac Bell Territory XXXXXX XXXXXX
US West Territory XXXXXX XXXXXX
Ameritech Territory XXXXXX XXXXXX
NYNEX Territory XXXXXX XXXXXX
Bell Atlantic Territory XXXXXX XXXXXX
</TABLE>
SCHEDULE B
TELCO REGIONS
<TABLE>
<CAPTION>
Southwestern Bell Territory
---------------------------
State Company
----- -------
<S> <C>
Arkansas XXXXXXXXXXXXX
Arkansas XXXXXXXXXXXXX
Kansas XXXXXXXXXXXXX
Missouri XXXXXXXXXXXXX
Missouri XXXXXXXXXXXXX
Oklahoma XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
Texas XXXXXXXXXXXXX
</TABLE>
MCI CONFIDENTIAL
F-1
<PAGE>
Bell South Territory
--------------------
State Company
----- -------
Alabama XXXXXXXXXXXXXXXXXXXXX
Alabama XXXXXXXXXXXXXXXXXXXXX
Alabama XXXXXXXXXXXXXXXXXXXXX
Alabama XXXXXXXXXXXXXXXXXXXXX
Alabama XXXXXXXXXXXXXXXXXXXXX
Mississippi XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
N. Carolina XXXXXXXXXXXXXXXXXXXXX
Florida XXXXXXXXXXXXXXXXXXXXX
Florida XXXXXXXXXXXXXXXXXXXXX
Florida XXXXXXXXXXXXXXXXXXXXX
Florida XXXXXXXXXXXXXXXXXXXXX
Georgia XXXXXXXXXXXXXXXXXXXXX
Georgia XXXXXXXXXXXXXXXXXXXXX
Georgia XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Kentucky XXXXXXXXXXXXXXXXXXXXX
Louisiana XXXXXXXXXXXXXXXXXXXXX
Louisiana XXXXXXXXXXXXXXXXXXXXX
Louisiana XXXXXXXXXXXXXXXXXXXXX
Louisiana XXXXXXXXXXXXXXXXXXXXX
Louisiana XXXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXXX
MCI CONFIDENTIAL
F-2
<PAGE>
S. Carolina XXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXX
S. Carolina XXXXXXXXXXXXXXXXXXXX
Tennessee XXXXXXXXXXXXXXXXXXXX
Tennessee XXXXXXXXXXXXXXXXXXXX
Tennessee XXXXXXXXXXXXXXXXXXXX
Tennessee XXXXXXXXXXXXXXXXXXXX
Tennessee XXXXXXXXXXXXXXXXXXXX
Tennessee XXXXXXXXXXXXXXXXXXXX
PacBell Territory
-----------------
State Company
----- -------
California XXXXXXXXXXXXXXXXXXXX
California XXXXXXXXXXXXXXXXXXXX
California XXXXXXXXXXXXXXXXXXXX
Nevada XXXXXXXXXXXXXXXXXXXX
Nevada XXXXXXXXXXXXXXXXXXXX
US West Territory
-----------------
State Company
----- -------
Iowa XXXXXXXXXXXXXXXXXXXX
Iowa XXXXXXXXXXXXXXXXXXXX
Iowa XXXXXXXXXXXXXXXXXXXX
Iowa XXXXXXXXXXXXXXXXXXXX
Minnesota XXXXXXXXXXXXXXXXXXXX
Minnesota XXXXXXXXXXXXXXXXXXXX
Minnesota XXXXXXXXXXXXXXXXXXXX
South Dakota XXXXXXXXXXXXXXXXXXXX
Washington XXXXXXXXXXXXXXXXXXXX
Washington XXXXXXXXXXXXXXXXXXXX
MCI CONFIDENTIAL
F-3
<PAGE>
Ameritech Territory
-------------------
State Company
----- -------
Illinois XXXXXXXXXXXXXXXXXXXXX
Illinois XXXXXXXXXXXXXXXXXXXXX
Illinois XXXXXXXXXXXXXXXXXXXXX
Indiana XXXXXXXXXXXXXXXXXXXXX
Michigan XXXXXXXXXXXXXXXXXXXXX
Michigan XXXXXXXXXXXXXXXXXXXXX
Michigan XXXXXXXXXXXXXXXXXXXXX
Ohio XXXXXXXXXXXXXXXXXXXXX
Ohio XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
Wisconsin XXXXXXXXXXXXXXXXXXXXX
NYNEX Territory
---------------
State Company
----- -------
Maine XXXXXXXXXXXXXXXXXXXXX
Maine XXXXXXXXXXXXXXXXXXXXX
Maine XXXXXXXXXXXXXXXXXXXXX
Maine XXXXXXXXXXXXXXXXXXXXX
Maine XXXXXXXXXXXXXXXXXXXXX
Maine XXXXXXXXXXXXXXXXXXXXX
Maine XXXXXXXXXXXXXXXXXXXXX
New Hampshire XXXXXXXXXXXXXXXXXXXXX
New Hampshire XXXXXXXXXXXXXXXXXXXXX
New Hampshire XXXXXXXXXXXXXXXXXXXXX
Vermont XXXXXXXXXXXXXXXXXXXXX
Vermont XXXXXXXXXXXXXXXXXXXXX
Vermont XXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXX
MCI CONFIDENTIAL
F-4
<PAGE>
New York XXXXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXXXX
New York XXXXXXXXXXXXXXXXXXXXXXX
Bell Atlantic Territory
-----------------------
State Company
----- -------
New Jersey XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Pennsylvania XXXXXXXXXXXXXXXXXXXXXXX
Virginia XXXXXXXXXXXXXXXXXXXXXXX
Virginia XXXXXXXXXXXXXXXXXXXXXXX
Virginia XXXXXXXXXXXXXXXXXXXXXXX
Virginia XXXXXXXXXXXXXXXXXXXXXXX
West Virginia XXXXXXXXXXXXXXXXXXXXXXX
West Virginia XXXXXXXXXXXXXXXXXXXXXXX
Virginia XXXXXXXXXXXXXXXXXXXXXXX
MCI CONFIDENTIAL
F-5
<PAGE>
EXHIBIT G
RELI
Customer and MCI will work together to implement Reseller Enhanced LEC Interface
Service ("RELI") that facilitates Customer's PIC changes at the appropriate LEC
in accordance with the respective responsibilities outlined in this Exhibit.
Customer understands and agrees that MCI will establish a reasonable
implementation schedule based on MCI's receipt and processing of all required
paperwork and the number of other pending RELI installs. Therefore, immediate
implementation of RELI may not be available and Customer will be advised of
MCI's expected implementation schedule. MCI shall provide RELI only for ANI's on
MCI Carrier Network Services.
PRICING
1. Customer shall pay MCI an initial non-recurring charge of XXX XXXXXXXX
XXXXXXXXXXXXXXXX and a monthly recurring charge based on Customer's monthly
usage of MCI Carrier Network Services, determined as follows:
Monthly Usage of MCI Monthly
Carrier Network Services Recurring Charge
------------------------ ----------------
XXXXXXXXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXXXXXXXX XXXXXX
XXXXXXXXXX XXXXXX
The above charges are only for ANI's provisioned on MCI's CNS platform via
RELI. These charges are exclusive of any applicable charges for LEC
services.
2. The charges set forth in Paragraph 1, above, are for RELI via Network Data
Mover transmission to one or more of the following Bell Operating Companies
("BOC's") or major independent telephone companies ("ITC's") (hereinafter
BOC's
MCI CONFIDENTIAL
G-1
<PAGE>
and ITC's shall be called "LECs"). For MCI provided RELI to these LECs,
Network Data Mover transmission must be used:
XXXXXXXXXX XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
XXXXXXXXXX XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
XXXXXXXXXX XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
XXXXXXXXXX XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
XXXXXXXXXX XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXX
Customer understands and agrees that it will be fully responsible for
any set-up fees associated with its receipt of service hereunder that are
charged by the companies listed in Paragraph 2.
3. For those LEC's not listed in Paragraph 2, Customer may receive RELI
Service via magnetic tape, fax or paper transmission.
4. Customer will provide at its expense its own internal hardware and software
needed for MCI RELI.
5. Customer understands that the pricing set forth above applies solely to ANI
loading to CICs which are routed to MCI and includes retransmission of ANIs
rejected by a LEC. The above pricing does not apply to non-MCI CNS ANIs.
CUSTOMER RESPONSIBILITIES
- - Customer will be responsible for providing MCI with all necessary end user
information to process all PIC install/change requests. This information
includes, but is not limited to:
. End User Name
. End User Address
. End User Working Telephone Number (WTN)
. End User Billing Telephone Number (BTN)
. Service Request (i.e., 1+, 800 etc.)
- - Customer will handle rejects from the front-end edits made by MCI prior to
the order being sent to the LEC or SMS.
MCI CONFIDENTIAL
G-2
<PAGE>
- - Customer will work with MCI to outline all technical interfaces between
Customer and MCI. Customer will provide a detailed overview of its
systems and processes to MCI.
- - Customer will be responsible for reconciliation of ANIs in its database
against ANI information provided by MCI to Customer.
- - Customer will be responsible for resolving all records rejected by the
LECs and for informing MCI of the resolution.
- - Customer will be responsible for payment of all charges imposed by the
LECs for processing records, including but not limited to all PIC fees
and account maintenance charges.
- - Customer will provide MCI with quarterly forecasts of its CNS outbound
and inbound minutes of use. Such statistical information will be
detailed at the NPA or serving area level.
- - Customer will obtain, complete and deliver all documentation required to
establish communications with each LEC.
- - Customer will provide MCI with a complete and prioritized list specifying
the LECs with which Customer wants MCI to establish service hereunder.
- - Customer will be responsible for updating, storing and maintaining its
files after they have been received from MCI via "CarrierBase", the
front-end Guided User Interface used by MCI Carrier Order Entry Hub to
process orders.
- - If Customer experiences problems with data received hereunder, Customer
is responsible for contacting the Carrier Order Entry Hub to initiate re-
delivery of the data.
- - After RELI is tested and implemented for the Customer to a particular
LEC, Customer will utilize RELI for all PIC requests relating to MCI CNS
ANIs.
- - Once Customer starts using RELI for a particular LEC, Customer can only
submit PIC request via RELI to that LEC.
MCI CONFIDENTIAL
G-3
<PAGE>
The LEC's only allow one medium and source of transmission for PIC
provisioning. Therefore customers that perform PIC provisioning for
ANI's on their facilities-based network cannot use RELI for CNS PIC
provisioning with the same LEC.
MCI RESPONSIBILITIES
- - MCI will be responsible for implementing and managing the LEC interface
process, other than Customer's internal costs incurred in performing its
responsibilities in connection with this process.
- - Order Entry processing will occur in MCI's Carrier Order Entry Hub in
Atlanta.
- - MCI's Carrier Order Entry Hub will notify Customer of any MCI, Third
Party Vendor, or LEC system impairments or limitations. MCI and Third
Party Vendor system impairments or limitations will be communicated to
Customer within forty-eight (48) hours of the occurrence. LEC system
impairments or limitations will be communicated within forty-eight (48)
hours of receipt of MCI notification. Customer understands and agrees
that MCI has no liability for delayed network data mover transmissions
resulting from any MCI, Third Party Vendor or LEC system impairments or
limitations.
- - MCI will provide Customer the following reports via electronic mail:
Report Time Interval
------ -------------
Pending BOC Action Weekly
Aged Reject Report Weekly
- - MCI CarrierBase will maintain copies of LEC interaction services files
for up to five (5) business days after they are sent to Customer. All
such files will be purged by MCI after five (5) business days. MCI will
respond to any requests for file transmission received within such (5)
business day period within forty eight (48) hours of MCI's receipt of
the request.
MCI CONFIDENTIAL
G-4
<PAGE>
EXHIBIT H
MCI FEATURE CARD SERVICE AND
ASSOCIATED FEATURE SERVICES DISCOUNT
A. MCI Feature Card Service (Option T).
When used under this Paragraph A, MCI Feature Card Service shall refer to
such service only as accessed by dialing the unique 800 access number
assigned by MCI to the MCI Feature Card Service.
1) For domestic (i.e., within the U.S., but excluding Alaska,
Hawaii, Puerto Rico and the U.S. Virgin Islands) interstate usage of MCI
Feature Card (exclusive of monthly recurring charges, taxes, surcharges,
installation charges, MCI Feature Card surcharges, Directory Assistance
charges, charges for local access/egress services or facilities, and
enhanced feature charges associated with MCI Feature Card Service),
Customer shall pay a postalized rate of XXXXXXX per minute.
2) For international usage of MCI Feature Card (exclusive of monthly
recurring charges, taxes, surcharges, installation charges, MCI Feature
Card surcharges, Directory Assistance charges, charges for local
access/egress services or facilities, and enhanced feature charges
associated with MCI Feature Card Service), Customer shall pay standard
tariff rates for MCI Feature Card Services in each applicable MCI tariff
less a discount of XXXXXXXXXXXXXXXXXXXXXXXXX. This discount is not
applicable to any surcharges or feature charges.
3) For domestic intrastate usage of MCI Feature Card (exclusive of
monthly recurring charges, taxes, surcharges, installation charges, MCI
Feature Card surcharges, Directory Assistance charges, charges for local
access/egress services or facilities, and enhanced feature charges
associated with MCI Feature Card Service), Customer shall pay standard
tariff rates for MCI Feature Card Service in each applicable MCI state
tariff. Customer will receive a credit of XXX of
MCI CONFIDENTIAL
H-1
<PAGE>
Customer's domestic intrastate usage of MCI Feature Card under the applicable
state tariff. This credit shall be applied to Customer's domestic interstate and
international monthly usage. Such credits will not exceed the amount of
Customer's interstate and international usage and any credit that is not applied
in the month accrued will expire and not be carried forward.
4) The following MCI Feature Card surcharges shall be charged on all direct
dial MCI Feature Card calls.
<TABLE>
<CAPTION>
Direct
From To Dial
- ---- -- ----
<S> <C> <C>
United States U.S., Puerto Rico
("U.S.") U.S. Virgin Islands,
Alaska and Hawaii XXXXXX
U.S. U.S., within same State
(domestic intrastate) XXXXXX
Puerto Rico U.S. XXXXXX
U.S. Virgin U.S. XXXXXX
Islands
U.S., Puerto Rico Canada
and U.S. Virgin
Islands XXXXXX
U.S., Puerto Rico International Locations
and U.S. Virgin Other than Canada XXXXXX
Islands
Canada U.S., Puerto Rico and
U.S. Virgin Islands XXXXXX
Canada International Locations XXXXXX
</TABLE>
5) The above discounts for MCI Feature Card Service are in lieu of any
Tariff discounts including, without limitation, the discounts for MCI Feature
Card Service
MCI CONFIDENTIAL
H-2
<PAGE>
available under MCI VIP, MCI VIP Plus, MCI MOD and MCI CAS Service.
6) For MCI Feature Card Service, Customer shall pay MCI for the
fulfillment costs associated with Customer's usage of MCI Feature Card
Service, plus an administrative charge for handling fulfillment in an
amount equal to XXXXXXXXXXXXXXXXXXXXX of the fulfillment costs.
7) For MCI Feature Card Service, MCI shall provide the fraud
detection procedures set forth in Exhibit I, attached hereto and
incorporated herein by reference. Customer shall be responsible for all
fraud associated with its usage of MCI Feature Card Service, except as set
forth in Exhibit I.
B. Discounts on Non-Tariffed Feature Services.
1) Customer will be entitled to the following applicable incremental
discounts on Customer's usage of non-tariffed Card Feature Services (MCI
Messenger Service, *3 Flexible Routing for Voice Mail, Voice News Network
and Speed Dialing) as determined by Customer's Non-Tariffed Feature
Services Monthly Usage (as defined below):
<TABLE>
<CAPTION>
Non-Tariffed
Feature Services
Monthly Usage Discount
------------- --------
<S> <C>
XXXXXXXXXXXXXXXXXXX XXXX
XXXXXXXXXXXXXXXXXXX XXXX
XXXXXXXXXXXXXXXXXXX XXXX
XXXXXXXXXXXXXXXXXXX XXXX
XXXXXXXXXXXXXXXXXXX XXXX
XXXXXXXXXXXXXXXXXXX XXXX
XXXXXXXXX XXXX
</TABLE>
The above discounts shall apply only to Customer's usage of non-tariffed
Feature Services provided pursuant to MCI's standard terms and conditions
for such services, but not to charges for installation, taxes or
surcharges, and charges
MCI CONFIDENTIAL
H-3
<PAGE>
for local access/egress services or facilities associated with non-tariffed
Feature Services.
2) Non-Tariffed Feature Services Monthly Usage shall mean Customer's
monthly combined recurring and usage charges for non-tariffed Feature
Services at standard pricing but not including taxes (and gross receipts
taxes), surcharges, and any charges for MCI Tariff or state tariff
services.
C. Discounts on Tariffed Feature Services.
1) Customer will be entitled to the following applicable incremental
discounts on Customer's usage of tariffed Card Feature Services (i.e.,
conference calling) as determined by Customer's Tariffed Feature Services
Monthly Usage (as defined below):
Tariffed
Feature Services
Monthly Usage Discount
------------- --------
XXXXXXXXXXXXXXXXXXX XXXXX
XXXXXXXXXXXXXXXXXXX XXXXX
XXXXXXXXXXXXXXXXXXX XXXXX
XXXXXXXXXXXXXXXXXXX XXXXX
XXXXXXXXXXXXXXXXXXX XXXXX
XXXXXXXXXXXXXXXXXXX XXXXX
XXXXXXXXXX XXXXX
The above discounts shall apply only to Customer's usage of tariffed
Feature Services provided pursuant to MCI's standard terms and conditions
for such services, but not to charges for installation, taxes or
surcharges, and charges for local access/egress services or facilities
associated with tariffed Feature Services.
2) Tariffed Feature Services Monthly Usage shall mean Customer's
monthly combined recurring and usage charges for tariffed Feature Services
at standard pricing but not including taxes (and gross receipts taxes),
surcharges, and any charges for MCI Tariff or state tariff services.
MCI CONFIDENTIAL
H-4
<PAGE>
EXHIBIT I
MCI FEATURE CARD FRAUD DETECTION PROCEDURES
====================================
All calling card calls will be validated by MCI to permit only those calls
authorized or facilitated by Excel or legitimate card holders. MCI will, at the
direction of Customer, preclude all calls utilizing expired or terminated
calling card numbers compared against an authorized list provided by Customer
and will be responsible for all fraudulent use, unauthorized use, misuse, or
abuse of calling cards occurring after MCI receives actual notice of the
expiration or termination of a calling card or receives specifically detailed
written notification concerning any card which has been lost, stolen,
compromised or which Customer has reason to believe is or may be used
fraudulently. MCI will deactivate a calling card within four (4) hours of
receipt by MCI's Consumer Markets Fraud Detection of a request by Customer.
In addition, all calling card calls will be monitored by MCI for fraudulent use,
unauthorized use, misuse or abuse on a twenty four (24) hour a day, seven (7)
days a week basis. MCI shall establish fraud prevention, detection and
minimization procedures so that fraudulent use arising from lost or stolen
calling cards and potential disruption to authorized card holders will be
minimized.
MCI will not hold the Customer responsible for "service fraud" associated with
the unauthorized use of an MCI calling card. "Service fraud" can best be
described as unauthorized use of an MCI calling card following the involuntary
theft or loss of a card which was not intentionally facilitated or impliedly
authorized by Customer or an authorized user. "Service fraud" often follows the
theft of a wallet, purse or briefcase, or sometimes is the result of "shoulder
surfing" (thieves observing/recording authorization codes) which occurs at
payphones located in airports, bus terminals, train stations and the like. MCI
shall not be responsible for losses caused by fraudulent information submitted
by a card holder in subscribing for calling card services or for usage which was
intentionally facilitated or impliedly authorized by an authorized user.
MCI CONFIDENTIAL
I-1
<PAGE>
In the event that MCI is unable to contact Customer of suspected abuse
of the calling card, in order to minimize potential abuse, MCI will deactivate
any calling card which has exceeded established fraud detection parameters or
which MCI has reason to believe is or may be used fraudulently.
MCI CONFIDENTIAL
I-2
<PAGE>
EXHIBIT 11
Primary
(Page 1 of 2)
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
COMPUTATION OF NET INCOME PER SHARE
(In thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
---- ---- ---- ----
Primary
- -------
<S> <C> <C> <C> <C>
Net Income.................................. $ 38,420 $ 7,875 $ 72,406 $13,059
Adjustment of shares outstanding:
Weighted average shares of common stock
outstanding................................ 104,708 99,000 101,854 99,000
Employee stock plan shares and shares of
common stock issuable upon the
assumed exercise of stock options...... 1,854 (2,280) 1,569 (2,520)
-------- ------ -------- -------
Adjusted shares of common stock and common
stock equivalents for computation...... 106,562 96,720 103,423 96,480
-------- ------ -------- -------
Net income per share........................ $ 0.36 0.08 $ 0.70 $ 0.14
======== ====== ======== =======
</TABLE>
<PAGE>
EXHIBIT 11
Fully Diluted
(Page 2 of 2)
EXCEL COMMUNICATIONS, INC. AND SUBSIDIARIES
COMPUTATION OF NET INCOME PER SHARE
(In thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
---- ---- ---- ----
Assuming Full Dilution
- ----------------------
<S> <C> <C> <C> <C>
Net Income.................................. $ 38,420 $ 7,875 $ 72,406 $13,059
Adjustment of shares outstanding:
Weighted average shares of common stock
outstanding........................... 104,708 99,000 101,854 99,000
Employee stock plan shares and shares of
common stock issuable upon the
assumed exercise of stock options..... 1,945 (2,280) 1,810 (2,520)
-------- ------- -------- -------
Adjusted shares of common stock and common
stock equivalents for computation..... 106,653 96,720 103,664 96,480
-------- ------- -------- -------
Net income per share........................ $ 0.36 $ 0.08 $ 0.70 $ 0.14
======== ======= ======== =======
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Form 10-Q as
of June 30, 1996 and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 150,420
<SECURITIES> 0
<RECEIVABLES> 185,875
<ALLOWANCES> 9,890
<INVENTORY> 3,784
<CURRENT-ASSETS> 338,331
<PP&E> 52,007
<DEPRECIATION> 3,770
<TOTAL-ASSETS> 496,310
<CURRENT-LIABILITIES> 174,371
<BONDS> 0
0
0
<COMMON> 109
<OTHER-SE> 247,424
<TOTAL-LIABILITY-AND-EQUITY> 496,310
<SALES> 0
<TOTAL-REVENUES> 626,155
<CGS> 0
<TOTAL-COSTS> 516,118
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 131
<INCOME-PRETAX> 116,133
<INCOME-TAX> 43,727
<INCOME-CONTINUING> 72,406
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 72,406
<EPS-PRIMARY> 0.70
<EPS-DILUTED> 0.70
</TABLE>
