MANAGED SERVICE PROVIDER AGREEMENT

STANDARD TERMS AND CONDITIONS

This Agreement is entered into between Preferred Data Corporation ("MSP") and the Client.

1. SERVICES & COVERAGE

1.1 Service Categories

Note: Specific services included in your agreement vary based on your selected service package and business needs. Your service agreement will detail exactly which services are included in your monthly fee.

1.2 Service Hours

Standard Support Hours: Monday - Friday: 8:00 AM - 5:00 PM ET, excluding federal holidays and scheduled maintenance windows.

After-Hours Support: Available for critical issues. Emergency rates apply as specified in your agreement.

1.3 Services Available Separately

The following services are not included in standard MSA agreements but are available at additional cost:

Hardware & Equipment

• Hardware purchases and replacements
• Support for equipment out of warranty or over 5 years old
• Physical relocation of equipment
• Equipment disposal and recycling

Projects & Development

• Capital projects and major infrastructure changes
• Projects lasting more than 4 hours
• Custom software development
• Office relocations and network buildouts
• New location setup and configuration

Software & Licensing

• Third-party software licenses (except those specified in your agreement)
• Specialty or industry-specific software support
• Software customization and integration

Other Services

• Internet connectivity and ISP charges
• Training services beyond basic orientation
• Data recovery from backups older than retention period
• After-hours emergency support (unless included in your package)
• Compliance audits and specialized regulatory consulting

These services are typically billed at our current hourly rates or quoted on a project basis.

2. SERVICE REQUIREMENTS

Simple, reasonable requirements that help us deliver reliable IT services. We will help you meet these standards as part of our onboarding process.

2.1 Equipment Standards

To ensure reliable performance and security:

Equipment Age: PCs, servers, and network equipment should be less than 5 years old. Why: Older equipment is more prone to failure and security vulnerabilities.

Warranty Coverage: Servers must maintain active hardware warranty. Why: Ensures quick replacement and minimal downtime for critical systems.

Hot Spare: One spare desktop and laptop for quick replacement. Why: Minimizes downtime when equipment fails.

2.2 Software & Licensing

Legal and supported software environment:

Operating Systems: Windows or macOS with current support from Microsoft/Apple. Why: Unsupported systems cannot receive security updates.

Genuine Licenses: All software must be properly licensed. Why: Ensures compliance and access to vendor support.

2.3 Network Infrastructure

Foundation for secure and reliable IT services:

Business Firewall: Hardware/Software based firewall between network and internet. Why: Essential first line of defense against cyber threats.

Backup Solution: Server-based backup system with monitoring capabilities. Why: Protects against data loss and enables disaster recovery.

Static IP Address: At least one static IP for remote access. Why: Enables secure VPN connections for remote support.

3. SERVICE LEVEL TARGETS

Service expectations and performance goals. We track our performance against these targets to continuously improve our service delivery.

3.1 Response Time Goals

* Target times during business hours (Monday-Friday, 8:00 AM - 5:00 PM ET, excluding holidays)

* Times are goals only and not guaranteed. Actual times may vary based on complexity, resource availability, and external factors.

* Resolution may require client cooperation, third-party vendor assistance, or replacement parts which may extend timelines beyond MSP control.

3.2 Performance Measurement

MSP tracks performance metrics for internal quality improvement purposes. Performance data is not contractually binding and is subject to interpretation based on various factors.

Response Time Tracking: Generally measured from ticket creation to first available technician response during business hours. May be impacted by ticket clarity, priority assessment, and resource availability.

Resolution Time Tracking: Generally measured from ticket creation to issue resolution. Resolution may depend on client cooperation, third-party vendors, hardware availability, and issue complexity beyond MSP control.

4. PRICING & BILLING

Transparent, predictable pricing with no hidden fees. Your specific pricing is detailed in your service agreement.

4.1 How Our Pricing Works

Per-User Pricing Model: Simple, scalable pricing based on your team size.

What Counts as a "User"? Any employee or contractor who regularly uses your IT systems.

Flexible Scaling: Add or remove users as your business needs change with prorated billing.

4.2 Billing Details

Billing Cycle: Services are billed monthly in advance on the 1st of each month. Your first invoice will be prorated based on your start date.

Payment Terms:

• Payment due within 30 days of invoice date
• Accepted methods: ACH (preferred), credit card (+ merchant fee), or check (undesired)
• Automatic recurring billing available for convenience
• No setup fees for new users

4.3 Late Payment Policy

We understand that cash flow can sometimes be challenging. Here is our fair approach:

• Days 1-5: Grace period, no action taken
• Day 5: Friendly reminder sent
• Day 10: 1% monthly interest begins accruing (12% per annum)
• Day 15: Final notice issued and MSP reserves the right to suspend services with 5 business days notice
• Day 20: Services may be suspended until full payment received, including all accrued interest and fees
• Day 25: MSP may (at its own discretion) terminate agreement, license(s), and service(s) and pursue collection remedies

If you are experiencing payment difficulties, please contact us. We are often able to work out arrangements.

4.4 Price Adjustments

We strive to keep pricing stable, but occasionally adjustments are necessary:

• 30 days advance notice for any price changes (except emergency rate adjustments)
• Prices generally locked for the initial contract term unless cost increases from vendors require adjustment
• MSP reserves the right to adjust prices for changes in scope, additional services, or market conditions
• Client may terminate with applicable termination fees if disagreeing with price changes

5. CLIENT RESPONSIBILITIES

Partnership works both ways. Here is what we need from you to ensure successful service delivery:

• Provide timely access to systems, facilities, and personnel as necessary
• Designate authorized contacts for service requests
• Maintain current licenses for all software
• Ensure hardware is under warranty or maintenance contract
• Maintain adequate internet connectivity for business needs
• Report issues promptly through our ticketing system
• Follow reasonable security recommendations
• Maintain your own critical data backups as an additional safeguard
• Ensure physical security of equipment
• Prohibit unauthorized modifications to systems or network configurations
• Maintain adequate liability and property insurance covering network damage and third-party claims
• Restrict Domain Administrator access - only MSP technicians will have administrative privileges

6. DATA PROTECTION & SECURITY

6.1 Data Ownership & Our Responsibilities

• Client retains all ownership rights to Client data
• We use commercially reasonable efforts to protect data under our control
• Security measures based on industry standards and best practices
• Regular updates and patches as part of standard maintenance
• Basic access controls for systems we manage

Note: We are not responsible for security of client-owned systems, third-party services, or data breaches resulting from client actions or inactions.

6.2 Security Incident Response

If we discover a security incident affecting systems under our management:

• We will make reasonable efforts to notify you promptly
• We will assist with investigation to the extent of our involvement
• We will document our findings and actions taken
• We will recommend improvements where applicable

Response times may vary based on incident severity and our ability to detect the issue.

6.3 Compliance Support

For clients with regulatory requirements:

• We can execute standard compliance agreements (e.g., HIPAA BAA) with additional fees
• We provide best-effort support for compliance initiatives
• Specialized compliance consulting available at additional cost
• Client remains responsible for overall compliance

We are not compliance auditors or legal advisors. Clients should consult appropriate professionals for compliance validation.

6.4 Data Return & Destruction

Upon termination of services, we will return or destroy Client data per written instructions within 30 days. Client is responsible for data transfer costs and ensuring all data is retrieved before the deadline.

6.5 Home & Remote Network Support

When Client transitions to home or alternative networks, MSP will make best efforts to enable connections and serviceability.

Important Disclaimers:

• Home or alternative networks may not have adequate internet connectivity and equipment to effectively work
• MSP is not responsible for inadequacies in home or alternative networks or to secure those connections
• Home equipment will not be as secure and may not have MSP's software and security features
• MSP is not responsible for the security of home or alternative networks
• Work on home or alternative networks is outside the scope of this Agreement unless specifically included
• MSP may charge its current hourly rate for work on home or alternative networks
• Additional software installed at home or alternative networks will be charged as needed

7. CONFIDENTIALITY

During the term of this Agreement and thereafter in perpetuity, neither party shall without the prior written consent of the other, disclose to anyone any Confidential Information of the other.

Confidential Information includes:

• Customer lists and contact information
• Business plans and strategies
• Financial information and pricing
• Technical data and specifications
• Software source code and configurations
• Trade secrets and proprietary methods

Exceptions:

• Information made publicly available by the disclosing party
• Information that becomes public through no fault of the receiving party
• Information rightfully received from third parties
• Information required to be disclosed by law or court order

8. LIMITATION OF LIABILITY

8.1 Liability Cap

8.2 Exclusion of Certain Damages

MSP shall not be liable for any indirect, incidental, special, consequential, or punitive damages, including but not limited to:

• Loss of profits or revenue
• Loss of data or use
• Business interruption
• Loss of goodwill
• Cost of substitute services

Even if MSP has been advised of the possibility of such damages.

8.3 Warranties & Disclaimers

MSP warrants that Services will be performed in a professional and workmanlike manner consistent with industry standards.

EXCEPT AS EXPRESSLY PROVIDED HEREIN, SERVICES ARE PROVIDED "AS IS" AND MSP DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

8.4 Insurance Coverage

MSP maintains appropriate insurance coverage including general liability, professional liability, and workers' compensation as required by law. Certificates of insurance are available upon request.

9. INDEMNIFICATION

9.1 Indemnification by Client

Client (as an indemnifying party) shall indemnify MSP (as an indemnified party) against all losses and expenses arising out of any proceeding:

1. brought by either a third party or MSP, and
2. arising out of Client's breach of its obligations, representations, warranties, or covenants under this agreement.

9.2 Mutual Indemnification

Each party (as an indemnifying party) shall indemnify the other (as an indemnified party) against all losses arising out of any proceeding:

1. brought by either a third party or an indemnified party, and
2. arising out of the indemnifying party's willful misconduct or gross negligence.

9.3 Notice and Failure to Notify

Notice Requirement: Before bringing a claim for indemnification, the indemnified party shall:

1. notify the indemnifying party of the indemnifiable proceeding, and
2. deliver to the indemnifying party all legal pleadings and other documents reasonably necessary to indemnify or defend the indemnifiable proceeding.

Failure to Notify: If the indemnified party fails to notify the indemnifying party of the indemnifiable proceeding, the indemnifying party will be relieved of its indemnification obligations to the extent it was prejudiced by the indemnified party's failure.

9.4 Exclusive Remedy

10. EQUITABLE RELIEF

10.1 Acknowledgment of Irreparable Harm

Each party acknowledges that their breach or threatened breach of their obligations under the sections regarding Confidentiality, Data Protection & Security, and Non-Solicitation would result in irreparable harm to the other party that cannot be adequately relieved by money damages alone.

10.2 Right to Equitable Remedies

Accordingly, the parties hereby acknowledge their mutual intent that after any breach or threatened breach of the obligations listed above, the non-breaching party may seek and obtain from a court of competent jurisdiction any applicable equitable remedies, including but not limited to:

• Temporary restraining orders
• Preliminary and permanent injunctions
• Specific performance
• Other equitable relief as deemed appropriate by the court

10.3 No Security Required

The parties agree that the non-breaching party shall not be required to post any bond or other security in connection with seeking or obtaining such equitable relief.

10.4 Cumulative Remedies

The rights and remedies provided in this section are cumulative and in addition to any other rights and remedies available at law or in equity.

11. REPRESENTATIONS AND WARRANTIES

11.1 Mutual Representations and Warranties

Each party represents and warrants to the other that:

• It is a corporation or limited liability company duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization.
• It has full corporate power and authority to enter into this Agreement and perform its obligations hereunder.
• The execution, delivery, and performance of this Agreement have been duly authorized by all necessary corporate action.
• This Agreement constitutes a legal, valid, and binding obligation, enforceable against it in accordance with its terms.
• Its execution and performance of this Agreement will not violate any provision of its charter documents, breach any agreement to which it is a party, or violate any applicable law.

11.2 Client's Additional Representations

Client represents and warrants that:

• All information provided to MSP is accurate and complete.
• It has the right to grant MSP access to all systems, data, and facilities necessary for MSP to perform the Services.
• It will comply with all applicable laws and regulations in its use of the Services.

12. EXPORT CONTROL COMPLIANCE

12.1 Export Compliance

Each party shall comply with all applicable export control laws and regulations, including but not limited to the U.S. Export Administration Regulations and the International Traffic in Arms Regulations.

12.2 Restricted Countries

Neither party shall export, re-export, or transfer any technology or services provided under this Agreement to any restricted or embargoed country, entity, or person without obtaining appropriate government authorization.

12.3 Certifications

Upon request, each party shall provide the other with certifications or other documentation necessary to demonstrate compliance with applicable export control requirements.

13. SUSPENSION OF SERVICES

13.1 Right to Suspend for Non-Payment

MSP may suspend Services if Client fails to pay any undisputed amount when due, provided that:

• MSP provides Client with at least five (5) business days' written notice of the payment default
• Client fails to cure the default within such notice period
• MSP provides at least two (2) business days' notice before actual suspension

13.2 Suspension Procedures

During any suspension:

• MSP will maintain Client's data and configurations
• Client remains responsible for all fees
• MSP will not be liable for any damages resulting from the suspension

13.3 Resumption of Services

MSP shall resume Services within one (1) business day after receiving all past due amounts, including any applicable late fees or reinstatement fees.

14. TERMINATION & TRANSITION

14.1 Term and Renewal

• Initial term: As specified in your service agreement
• Automatic renewal for successive terms of equal length unless terminated
• Either party may provide 30 days written notice of non-renewal prior to term expiration
• Early termination during initial term may only be allowed for material breach or as specified in the service agreement
• MSP may terminate immediately for non-payment, breach of security policies, or violation of acceptable use terms

14.2 Termination by Client

After the initial contract term, Client may terminate with 30 days written notice and payment of:

• Any applicable termination fee as specified in your service agreement
• All outstanding amounts due and unpaid
• Costs for data transfer, transition services, and license removal
• Any setup fees, onboarding costs, or credits that were amortized over the contract term
• Pro-rated charges for any services provided through the termination date

14.3 Termination by MSP

MSP may terminate upon:

• Non-payment after 10 business days written notice
• Material breach not cured within 10 business days of notice
• Bankruptcy or insolvency proceedings lasting 60+ days
• Failure to comply with service requirements after notice

14.4 Data Transfer & Transition

Backup Data:

• Client has 30 days to transfer backup data
• Client responsible for transfer costs
• Data deleted after 30 days if not transferred
• MSP will provide reasonable assistance at hourly rates

Service Removal:

• MSP will remove monitoring tools and licenses
• Important: If Client fails to provide access for removal of licenses and monitoring tools, Client agrees to continue paying 50% of the monthly service fee until access is granted
• Client must provide access for removal
• Spam filtering terminated immediately
• Client responsible for redirecting MX records

Extended Support Option: Upon request, MSP will provide up to 60 days additional support to facilitate transition, with payment required in advance.

15. DISPUTE RESOLUTION

15.1 Resolution Process

Step 1: Good Faith Negotiation

The parties shall first attempt to resolve any dispute through good faith negotiations. The aggrieved party must present the dispute in writing, and parties have 30 days to reach resolution.

Step 2: Mediation (Optional)

If negotiation fails, either party may request mediation through a mutually agreed mediator. Costs split equally between parties.

Step 3: Binding Arbitration

If not resolved through negotiation or mediation, disputes shall be settled by binding arbitration before a single neutral arbitrator under the rules of the American Arbitration Association. Arbitration shall be conducted in North Carolina.

16. GENERAL TERMS

16.1 Force Majeure

Neither party shall be liable for delays or failures due to circumstances beyond reasonable control, including but not limited to: acts of God, natural disasters, pandemics, war, terrorism, labor disputes, government actions, or internet/infrastructure failures. Payment obligations are not excused by force majeure events.

16.2 Non-Solicitation

During the term of this Agreement and for 24 months after termination, neither party shall solicit for hire or employ the other party's employees or contractors who were involved in performing services under this Agreement. This does not apply to general recruitment advertising.

16.3 Assignment

This Agreement is fully assignable by MSP. Client may not assign without MSP's written consent. The Agreement shall be binding upon all permitted assignees and successors.

16.4 Modifications

MSP may propose changes to these terms with 30 days advance written notice. Changes take effect unless objected to within the notice period. All modifications must be in writing to be valid.

16.5 Governing Law

This Agreement shall be governed by the laws of North Carolina. Exclusive jurisdiction and venue for all matters shall be in Guilford County, North Carolina.

16.6 Entire Agreement

This Agreement, including all referenced schedules and your specific service agreement, constitutes the entire agreement between the parties and supersedes all prior agreements and understandings.

16.7 Severability

If any provision of this Agreement is found to be unenforceable, the remainder shall continue in full force and effect, and the unenforceable provision shall be modified to the minimum extent necessary to make it enforceable.

16.8 Taxes

All prices are exclusive of applicable taxes. Client shall pay all federal, state, and local taxes, except those based on MSP's income. Tax-exempt organizations must provide valid exemption certificates.

16.9 Relationship of the Parties

Nothing in this Agreement creates any partnership, joint venture, agency, franchise, sales representative, or employment relationship between the parties. Neither party has the authority to bind the other or to incur any obligation on its behalf without the other party's prior written consent. Each party is an independent contractor.

16.10 No Third-Party Beneficiaries

This Agreement is solely for the benefit of the parties hereto and their permitted successors and assigns. Nothing in this Agreement, express or implied, is intended to confer upon any other person or entity any rights, benefits, or remedies of any nature whatsoever.

16.11 Attorney Fees

If either party brings an action to enforce its rights under this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees, costs, and expenses incurred in connection with such action, including any appeal thereof, from the non-prevailing party.

16.12 Counterparts

This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Electronic signatures and scanned copies of signatures shall be deemed original signatures for all purposes.

17. DEFINITIONS

For purposes of this Agreement, the following terms have the meanings set forth below:

"Business Day"

Monday through Friday, excluding federal holidays and MSP-observed holidays, during MSP's normal business hours of 8:00 AM to 5:00 PM Eastern Time.

"Confidential Information"

All non-public, proprietary, or confidential information disclosed by one party to the other, whether orally, in writing, or in any other form, including but not limited to: technical data, trade secrets, know-how, research, product plans, products, services, customers, customer lists, markets, software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing, finances, or other business information.

"Covered Services"

The specific IT services, support, and deliverables described in the Service Agreement, including any amendments or addenda thereto.

"Service Agreement"

The separate agreement detailing specific services, pricing, and service levels, which incorporates these terms by reference.

"Service Level Agreement" or "SLA"

The performance standards and metrics that MSP commits to meet in delivering the Services, as specified in the Service Agreement.

18. INTERPRETATION

18.1 Construction

The following rules of construction shall apply to this Agreement:

• The word "including" and words of similar import shall mean "including without limitation."
• Words in the singular include the plural and vice versa. Words in one gender include all genders.
• Section headings are for convenience only and shall not affect the interpretation of this Agreement.
• Unless otherwise specified, all monetary amounts in this Agreement refer to United States dollars.
• If any action is required to be taken on a day that is not a Business Day, such action shall be taken on the next Business Day.
• This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted.

18.2 Order of Precedence

In the event of any conflict or inconsistency between or among the following documents, the order of precedence shall be:

1. Any amendments or addenda to this Agreement (most recent prevails)
2. The Service Agreement
3. This MSP Agreement
4. Any statements of work or service orders

VERSION HISTORY & LEGAL NOTICE