I. THE CONTRACT By using, paying for or subscribing Rixtel services, you agree to the prices, charges, terms, conditions and other provisions of this contract. If you do not agree with any provisions of this contract, do not use any Rixtel services, cancel using them immediately and contact Rixtel for further information. These Terms and Conditions form the contract (the "Contract") between Rixtel Ltd. ("Rixtel", us, we) and the user ("you", "your", "user", "Client") of Rixtel's services and any related products ("Service"). Within the Contract, "you" means the Client, i.e., either (i) the person identified in Rixtel's account records as responsible for payment of all charges; or (ii) any other person with actual or apparent authority to represent that person or to use the service(s). The Contract regulates the Service. By subscribing, using, or activating the Service, you acknowledge that you understand, and agree to, this Contract, and you guarantee that you are legally capable to enter the Contract and become bound by it. The rates and charges for the Service, which may be found at the website www.rixtel.com, are effective as of August 1, 2006. These prices and charges are subject to change. For the most current information on rates, charges, text of the Contract, or if you have any questions whatsoever about the services of Rixtel or any provisions of this contract, please visit our website, call us, or contact us by e-mail. All the contact details are available at www.rixtel.com. Rixtel may change the Terms and Conditions of the Contract. Notices will be considered given and effective on the date published at the website www.rixtel.com. The Contract posted is superior to any previously agreed to electronic and written contracts. II. EMERGENCY A. Service Outage: 1. Power Outage You acknowledge and understand that the Service does not function without power. Should there happen an interruption in the power supply, the Service will not function until power is available. A power failure or disruption may require the Client to reset or reconfigure equipment before using the Service again. 2. Internet Connection Service Failure You acknowledge and understand that service failures by your local internet provider may disable selected Services. 3. Service Cancellation Due to Suspension of Your Account You acknowledge and understand that service cancellations due to suspension of your account as a result of billing issues will prevent all kinds of Service. 4. Other Service Outages You acknowledge and understand that if there is a service outage for any reason such outage will prevent the whole Service. Such outages may occur for a variety of reasons, including, but not limited to those reasons described elsewhere in this Contract. 5. Limitation of Liability and Indemnification You acknowledge and understand that Rixtel's liability is limited for any Service outage, as set forth in this document. You agree to defend, indemnify, and hold harmless Rixtel, its employees and any other service provider who provides services to Client in connection with this Contract or the Service, from any and all claims, losses, damages, fines, penalties, costs and expenses (including, without limitation, reasonable attorneys fees) by, or on behalf of, Client or any third party or user of Client's Service relating to the absence, failure or outage of the Service. III. SERVICE A. Period Service is offered on a monthly basis for a period that begins on the date that Rixtel activates your account (the "Starting date") and ends on the day before the same date in the following month. The Starting date will begin the next day after you sign-up for the Service. Subsequent terms of this Contract automatically renew on a monthly basis without further action by you unless you give Rixtel written notice of non-renewal at least ten [10] working days before the end of the monthly term in which the notice is given. You are purchasing the Service for full monthly terms, meaning that if you terminate Service before the end of a monthly term, you will be responsible for the full month's charges to the end of the then-current term, including without limitation unbilled charges, plus any applicable disconnect fee, all of which immediately become due and payable. Expiration of the term or termination of Service does not excuse the Client from paying all unpaid, accrued charges due in relation to the Contract. B. Individual Use of Service If you have subscribed to Rixtel's individual services, the Services are provided to you as an individual user, for your individual, residential, non-business and non-professional use. This means that you are not using them for any commercial or governmental activities, profit-making or non-profit, including but not limited to home office, business, sales or any other activity that would be inconsistent with normal residential usage patterns. This also means that you are not to resell or transfer the Service to any other person for any purpose, or make any charge for the use of the Service, without express written permission from Rixtel in advance. Rixtel reserves the right to immediately terminate or modify the Service, if Rixtel determines, in its sole discretion, that Client's Service is being used for non-residential or commercial use. C. Corporate Use of Service If you have subscribed to Rixtel's corporate services, the Services are provided to you as a corporate user. This means that you are not to resell, re-market or transfer the service to any other person for any purpose in any way whatsoever. Rixtel reserves the right to immediately terminate, modify or upgrade the Service, if Rixtel determines, in its sole discretion, that Client's Service is being used for any of the above mentioned. D. Copyright / Trademark, Firmware or Software The Service and any firmware or software used to provide the Service or provided to Client in conjunction with providing the Service, and all Services, information, documents and materials on Rixtel's website(s) are protected by trademark, copyright or other intellectual property laws and international treaty provisions. All websites, corporate names, service marks, trademarks, trade names, logos and domain names (i.e., "marks") of Rixtel are and shall remain the exclusive property of Rixtel and nothing in this Contract shall grant you the right to license or to use such marks. You acknowledge that you are not given any license to use the firmware or software used to provide the Service or provided to Client in conjunction with providing the Service, other than a nontransferable, revocable license to use such firmware or software (without making any modification thereto) strictly in accordance with the terms and conditions of this Contract. E. Notice of Rate Changes Rixtel may change the prices and charges for the Services. We may decrease prices without providing advance notice. Changes to any other rates, charges, or terms or conditions in the Contract will be published at our website www.rixtel.com and this Contract will be updated accordingly within a reasonable period of time. F. Taxes 1. All taxes, tax-like charges, and tax-related surcharges are referred to collectively as "Tax(es)." Rixtel may elect to impose and collect such Taxes, unless otherwise constrained by court order or direction. 2. You agree to pay all Taxes imposed. IV. RESTRICTIONS ON THE USE OF SERVICE A. Rixtel offers its services subject to availability of facilities, limitations of service offerings, and the provisions of this Contract. B. Services provided by Rixtel under the Contract will not be used for any unlawful purpose. C. Rixtel may (1) deny, for any lawful reason, your request for service, or (2) limit or allocate the facilities available to or used by any Service, if necessary, to manage its network in an efficient manner; meet reasonable service expectations; provide service to existing and future Clients based on forecasted Client requirements; or for any other lawful reason. V. PAYMENT OBLIGATIONS A. You must provide Rixtel with a valid credit card number when the Service is activated. If the credit card expires, you close your credit card account or your billing address changes, or the credit card is cancelled and replaced because of loss or theft, you must advise Rixtel immediately. Rixtel will invoice all charges on a monthly basis, in advance, to your credit card, including but not limited to: activation fees and monthly Service fees, advanced feature charges, equipment purchases and shipping and handling charges. Any charges not included in your rate plan and any additional usage charges are billed after each billing period. If Rixtel changes its rates, recurring monthly charges affected by such change will be assessed at the new rate for the full billing period during which the new recurring charge rate became effective. B. You are responsible for payment of all charges for services provided to you and anyone authorized by you to use your service. This responsibility is not changed by virtue of any use, misuse, or abuse of your service undertaken or caused by third parties. C. You must promptly notify Rixtel of any change in your invoicing address or, if applicable, in the credit card or bank account used for payment. D. Rixtel may terminate your Service at any time in its sole discretion, if any charge to your credit card on file with Rixtel is declined or reversed, your credit card expires and you have not provided Rixtel with a valid replacement credit card or in case of any other non-payment of account charges. Termination of Service for declined or expired card, reversed charges or non-payment leaves you fully liable to Rixtel for all charges accrued before termination and for all costs incurred by Rixtel in collecting such amounts, such as (but not limited to) collection costs and attorney's fees. E. Rixtel will invoice Client for Services on a monthly basis in advance and all payments are due and payable by Client without demand within thirty (30) days from the invoice date (the "Due Date"). Amounts not paid within twenty-nine (29) days of the invoice date will be considered past due. If you make any late payments, and we bill you for the Services, we will charge you a late fee of 1%, which we apply to that period's charges and any outstanding charges and late payment charges that remain unpaid at the time of the next bill. F. If billing systems or other support is not available for a service, feature, surcharge, tax or other charge element at the time of service provision, Rixtel will bill for that service, feature, surcharge, or other charge element as soon as it is capable of doing so. G. If Rixtel becomes concerned at any time about your ability to pay for services, Rixtel may require that you pay its charges within a specified number of days and that you make such payments in cash or the equivalent of cash. H. If Rixtel hires a collection agency to collect, or attempt to collect, any charges owed Rixtel, you will be liable to Rixtel for an additional payment. If Rixtel incurs any fees or expenses, including attorneys' fees, in collecting, or attempting to collect, any charges owed Rixtel other than by hiring a collection agency, you will be liable to Rixtel for the payment of all such fees and expenses. VI. CANCELLATION OF SERVICE A. By the Client 1. If you cancel your Service with Rixtel, you will not be able to use the Service. 2. Cancellation may take up to three (3) business days. 3. You will be charged for any usage after contacting Rixtel to cancel your Service. B. By Rixtel 1. Rixtel reserves the right to stop providing services, cancel your account, and/or block or freeze your access to Rixtel network, without incurring any liability, immediately and without notice if Rixtel deems that such action is necessary to prevent or to protect against fraud or to otherwise protect Rixtel's personnel, agents, facilities, or services. Without limitation, Rixtel may take such actions if: a. You refuse to provide information or provide false information that (i) is essential for billing; or (ii) pertains to your creditworthiness, your past or current use of common service, or your planned use of such service; b. You indicate that you will not comply with a request for security for the payment for services; c. Your service usage charges exceed established parameters based on your history of usage, which may indicate a likelihood of non-payment or possible fraud; d. You have been given a regular written notice or an e-mail notice by Rixtel of any past due amount (which remains unpaid, in whole or in part) for any of Rixtel's or an affiliated company's service to which you either subscribe or had subscribed or used; e. You use, or attempt to use, service with the intent to avoid the payment, either in whole or in part, of the charges for the service by (i) using or attempting to use service by rearranging, tampering with, or making connections to service in an unauthorized manner; or (ii) using tricks, schemes, false or invalid numbers, false credit devices, or other fraudulent means or devices; f. You were previously provided with notice of breach of contract, took corrective action, but thereafter engage in the same breach activity; or g. You act in a manner that is threatening, obscene, harassing, or abusive to Rixtel personnel. h. You act in violation of any provisions of this contract, any your local or any international laws. 2. Rixtel reserves the right to discontinue providing services, cancel your account, and/or block or freeze your access to Rixtel network, without incurring any liability, immediately upon written notice to you if: a. Any invoice charges remain outstanding and owed by you after the 30th day from the date of the invoice notifying you of the charges; or b. You fail to comply with a request by Rixtel for security for the payment for services. 3. The discontinuance of service(s) by Rixtel pursuant to these provisions does not relieve you of any obligation to pay Rixtel for charges due and owing for service(s) provided up to the time of discontinuance. Rixtel may charge you a Disconnect fee if your service is canceled pursuant to any provision of this contract. VII. LIABILITY A. Rixtel will not be liable for: (i) any failure of performance due to causes beyond its control, including, but not limited to, acts of God, fires, floods or other catastrophes; national emergencies, insurrections, riots or wars, acts of terrorism, strikes, lockouts, work stoppages or other labor difficulties; and any law, order, regulation or other action of any governing authority or agency thereof; or (ii) delayed installation of Rixtel's facilities or commencement of service. B. With respect to any other factual allegation, legal claim, or dispute by you or by any others, for damages associated with the ordering (including the reservation of any specific number for use with a service), installation (including delays thereof), provision, termination, maintenance, repair, interruption, or restoration of any service or facilities offered by Rixtel, Rixtel's liability, if any, will be limited as follows: C. IN NO EVENT WILL RIXTEL BE LIABLE TO YOU FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE LOSS OR DAMAGE OF ANY KIND, INCLUDING LOST PROFITS (WHETHER OR NOT RIXTEL HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGES) BY REASON OF ANY ACT OR OMISSION IN ITS PERFORMANCE UNDER THIS CONTRACT. THIS SECTION SURVIVES TERMINATION OF THIS CONTRACT. D. Rixtel will be indemnified, defended, and held harmless by you against all claims of loss or damage arising from the use of service provided by Rixtel, including: 1. Allegations or claims for libel, slander, invasion of privacy, or infringement of copyright arising out of the material, data, information, or other content transmitted via Rixtel service; and 2. All other allegations and claims arising out of any intentional act or omission by you or others authorized by you to use the service, in connection with any service provided by Rixtel. E. RIXTEL MAKES NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES ABOUT ITS SERVICES AND DISCLAIMS ANY IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR NONINFRINGEMENT. RIXTEL DOES NOT AUTHORIZE ANYONE TO MAKE A WARRANTY ON RIXTEL'S BEHALF AND YOU MAY NOT RELY ON ANY STATEMENT OF WARRANTY AS A WARRANTY BY RIXTEL. F. Rixtel will not be liable for any act or omission of any other company or companies providing a portion of the service, or from any act or omission of a third party, including those vendors participating in Rixtel offerings made to you, or for damages associated with service, or equipment that it does not provide, or for damages that result from the operation of Client provided systems, equipment, facilities or services that are interconnected with Rixtel services. VIII. DISPUTE RESOLUTION A. Binding Arbitration All disputes arising shall be resolved in the arbitration court �Rigas Skirejtiesa�, located at 18 E.Birznieka-Upisa street, Riga, postal code LV-1050, Republic of Latvia. The dispute shall be adjudicated by a single arbitration judge, chosen by Rixtel. The governing laws shall be the laws of the Republic of Latvia. NO DISPUTE MAY BE JOINED WITH ANOTHER LAWSUIT, OR IN AN ARBITRATION WITH A DISPUTE OF ANY OTHER PERSON. THE ARBITRATOR MAY NOT AWARD DAMAGES THAT ARE NOT EXPRESSLY AUTHORIZED BY THIS CONTRACT AND MAY NOT AWARD PUNITIVE DAMAGES OR ATTORNEYS' FEES. YOU AND RIXTEL BOTH WAIVE ANY CLAIMS FOR AN AWARD OF DAMAGES THAT ARE EXCLUDED UNDER THIS CONTRACT. B. Arbitration Information and Filing Procedures Before you take a dispute to arbitration, you must first contact a Rixtel representative by e-mail, phone or fax, or individually, or write to us at the following address and give us an opportunity to resolve the dispute: Rixtel Ltd. 31A Elizabetes street 1 Riga LV-1010 Republic of Latvia You must describe your dispute and provide Rixtel with any supporting documentation. Likewise, if Rixtel has a dispute with you, it will notify you by letter sent to your billing address and attempt to resolve it before pursuing arbitration. C. Fees and Expenses of Arbitration Each party must pay its own expenses associated with any arbitration, including its attorney's fees. IX. FINAL PROVISIONS A. Entire Contract. These Terms and Conditions constitute the entire Contract between you and Rixtel, and supersede any and all prior contracts, oral or written. If there is any inconsistency or conflict between the terms of any authorized written communications you have received and the provisions of this Contract, the provisions of this Contract will control. B. No Obligation to Assist in Switching to a Different Provider. If you either voluntarily cancel your Rixtel account or if Rixtel cancels your service for any reason set forth above, Rixtel will have no obligation whatsoever to assist you in any respect in switching from Rixtel to another service provider. C. Assignment. Clients may not modify or assign this Contract. In its sole discretion, Rixtel may assign this Contract. D. No Waiver of Rights. If either party fails to enforce any right or remedy under this Contract, that does not waive the right or remedy for any other breach or failure. E. Binding Effect. This Contract is binding upon you and Rixtel and upon, respectively. F. Severability. If any part or provision of this Contract is finally determined to be invalid or unenforceable under applicable law by the arbitration of competent jurisdiction, then that part or provision will be ineffective only to the extent of such invalidity or unenforceability, without in any way affecting the remaining parts or provisions of this Contract. G. Governing Law. This Contract is governed by the laws of Republic of Latvia. H. Survival. Any liability or obligation of a party to the other party under the provisions of Sections I, II, IV, V and VII as applicable, will, in each case, survive cancellation or termination of this Contract. � 2006 Rixtel Ltd.