Document:

Exhibit101DTPearsonEmploymentAgreementfor10Q

EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (“Agreement”), is entered into this April 25, 2013, by and between VONAGE HOLDINGS CORP., a Delaware corporation (the “Company”), and David T. Pearson (the “Executive”).
NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth, the parties hereto agree as follows:
		
	1.
	Employment and Duties.  

(a)General.  The Executive shall serve as  Chief Financial Officer and Treasurer of the Company, reporting to the Chief Executive Officer (the “CEO”) of the Company and, as requested by the Board of Directors of the Company (the “Board”), to the Board.  The Executive shall have the duties, responsibilities, and authority customarily held by the chief financial officer and treasurer of a public corporation.  The Executive shall also perform such other duties (which may be increased or decreased at the discretion of the CEO from time to time) as the CEO or Board may from time to time require, which shall be consistent with the general level and type of duties and responsibilities customarily associated with the positions of chief financial officer and treasurer (“Other Duties”).  Other Duties may include, without limitation, investor relations, strategic planning and corporate development, and facilities.  The Executive’s principal place of employment shall be the principal offices of the Company, currently located in the Holmdel, New Jersey area; provided, however, that the Executive understands and agrees that he shall be required to travel from time to time for business reasons. 
(b)Exclusive Services.  For so long as the Executive is employed by the Company, the Executive shall devote his full-time working time to his duties hereunder, shall conform to and use his good faith efforts to comply with the lawful and good faith directions and instructions given to him by the CEO and, upon its request, the Board, and shall use his good faith efforts to promote and serve the interests of the Company.  Further, the Executive shall not, directly or indirectly, render services to any other person or organization without the consent of the Company or otherwise engage in activities that would interfere with the faithful performance of his duties hereunder.  Notwithstanding the foregoing, the Executive may (i) serve on corporate boards, with the prior consent of the CEO, the Chairman of the Board and the Lead Independent Director of the Board, (ii) serve on civic or charitable boards or engage in charitable activities without remuneration therefor, and (iii) manage his personal investments, and serve as an executor, trustee, or in a similar fiduciary capacity in connection therewith, provided that such activities do not, individually or in the aggregate, conflict materially with the performance of the Executive’s duties under this Agreement.
2.Employment “At-Will”.  The Executive’s employment shall commence on May 1, 2013 (the “Effective Date”) and the period from the Effective Date through the date of the Executive’s termination of employment, as provided herein, shall be the “Term.”  Continuation of the Executive’s employment with the Company throughout the Term shall be deemed an employment “at will” and the Executive’s employment may be terminated “at will” by either Executive or the Company.
3.Compensation and Other Benefits.  Subject to the provisions of this Agreement, the Company shall pay and provide the following compensation and other benefits to the Executive during the Term as compensation for services rendered hereunder:
(a)    Base Salary.  The Company shall pay to the Executive an annual base salary (the “Base Salary”) of not less than Four Hundred Seventy-Five Thousand Dollars ($475,000), payable in substantially equal installments at such intervals as may be determined by the Company in accordance with its regular payroll practices for similarly situated employees, but in no event less 

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frequently than biweekly in arrears.  The Base Salary shall be reviewed for increase by the Compensation Committee of the Board in good faith, based upon the Executive’s performance, not less often than annually.  The Base Salary may be increased, but not decreased below its then current level, from time to time by the Board, and as so increased shall thereafter be the “Base Salary.”
(b)     Sign-On Option Grant and Future Option Grant Opportunities.  In connection with the Executive’s commencement of employment, the Executive shall be awarded, on May 3, 2013 (the “Grant Date”), a one-time sign-on nonqualified stock option grant to purchase Two Million (2,000,000) shares of the Company’s common stock  (the number of shares and exercise price being subject to adjustment based on stock splits, reverse stock splits, other adjustments, or recapitalizations between the date hereof and the Grant Date) (the “Sign-On Options”) at a price per share equal to the closing price of the Company’s common stock on the Grant Date.  The Sign-On Options shall be issued pursuant to the terms and conditions of the Vonage Holdings Corp. 2006 Incentive Plan, as amended or restated from time to time (the “2006 Incentive Plan”), and the Executive’s individual stock option agreement (the “Stock Option Agreement”), in form substantially similar to  that attached hereto as Exhibit A.  Notwithstanding anything to the contrary in the 2006 Incentive Plan or any stock option agreement thereunder, the following provisions of this Section 3(b) shall govern the terms of the Sign-On Options (and, solely to the extent specifically provided in this Section 3(b), all other outstanding options issued by the Company to the Executive).  The Sign-On Options shall vest and become exercisable as to 1/4th of the shares on each of the first, second, third and fourth anniversaries of the Grant Date (each, an “Option Vesting Date”), subject to the Executive’s continued employment on the applicable Option Vesting Date; provided, however, that all outstanding Sign-On Options shall become fully vested and exercisable  if, after a Change of Control, Executive’s employment is terminated without Cause by the Company, for Good Reason by the Executive, or due to the Executive’s death or “disability” (in each case, as defined below) on or prior to the first anniversary thereof.  For purposes of this Agreement, “Change of Control” shall have the meaning set forth in the 2006 Incentive Plan; provided, however, that the acquisition of additional securities of the Company by any Person (as defined in the 2006 Incentive Plan) that, together with its Affiliates (as defined in the 2006 Incentive Plan), currently is the Beneficial Owner (as defined in the 2006 Incentive Plan) of twenty percent (20%) or more of the combined voting power of the Company’s outstanding securities shall not constitute a Change of Control.  Upon a termination of the Executive’s employment without Cause by the Company or by the Executive for Good Reason (other than on or prior to the first anniversary of a Change of Control), an additional amount of the outstanding Sign-On Options granted by the Company to the Executive shall become vested and immediately exercisable as of the date of such termination in accordance with the provisions of the immediately following sentence.  For each outstanding Sign-On Option, such additional amount shall be equal to the number of Sign-On Options that would have vested on the next Option Vesting Date immediately following the date of termination, multiplied by a fraction where (1) the numerator is  the number of full and fractional months that had elapsed between the Option Vesting Date immediately prior to such termination and such termination date plus the number of full and fractional months remaining in the calendar quarter that includes such termination date, and (2) the denominator is twelve (12).  Notwithstanding the foregoing, in no event shall the number of Sign-On Options vesting pursuant to the foregoing sentence exceed the number of Sign-On Options that would have vested on the next Option Vesting Date immediately following the date of termination.  Upon a termination of the Executive’s employment by the Company without Cause or by the Executive for Good Reason, all outstanding options granted by the Company to the Executive (whether part of the Sign-On Options or not) shall (to the extent vested) remain exercisable for at least 180 days after the termination, or until the end of the term of the option, if earlier.  Upon a termination of the Executive’s employment by the Executive without Good Reason, all vested outstanding options granted by the Company to the Executive shall remain exercisable for at least 60 days after termination, or until the end of the term of the option, if earlier.  The Executive shall be considered for future option grants based on individual and Company performance (and established in conjunction with the Company’s regular equity review cycle).  

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(c)    Annual Cash Bonus.  The Executive shall be eligible to receive an annual, discretionary cash bonus (the “Annual Bonus”) with a Target Bonus Opportunity (“TBO”) of up to 100% of the Executive’s then current Base Salary for the applicable year.  Subject to Sections 4(b) and 4(c) below, for calendar year 2013, the Annual Bonus for which the Executive is eligible shall be equal to the greater of (i) $475,000 and (ii) the Annual Bonus the Executive otherwise would be eligible to receive in respect of 2013, prorated for the number of full months worked from the Effective Date through December 31, 2013.  Annual Bonus payouts are not guaranteed and are granted in the Company’s sole discretion based on individual and Company performance.  The Company performance targets applicable to the Executive’s Annual Bonus shall be in accordance with the Company’s annual bonus program as applicable to senior executives of the Company, as in effect from time to time.  Annual Bonus payouts, if any, are generally paid in February or March of the calendar year following the calendar year in which such payout is earned, subject to the Executive’s continued employment on such payment date, except as otherwise provided in Section 4. 
(d)    Employee Benefit Plans.  
(i)The Executive shall be entitled to participate in all employee health and welfare plans, programs and arrangements of the Company, in accordance with their respective terms, as may be amended from time to time, on a basis no less favorable than that made available to other senior executives of the Company; provided, however, that, to the extent it does so for the CEO, the Company will pay the full cost of the following insurance benefits for the Executive and his spouse and dependents: medical, dental, vision, basic life, accidental death and dismemberment, and core long term disability.  The Executive shall be eligible to participate in the Vonage medical and dental plans and the 401(k) Retirement Plan commencing on the first day of the month following the Effective Date. 
(ii)The Company shall reimburse the Executive for all reasonable out-of-pocket expenses actually incurred or paid by the Executive for the continuation of the Executive’s current medical and dental benefits for the Executive and his spouse and dependents (and excluding all other benefits, including, without limitation, vision benefits) during the waiting period described in Section 3(d)(i) above, in the amount of 100% of such costs up to a maximum of $4,000.
(e)    Expenses.  The Company shall reimburse the Executive for reasonable travel and other business-related expenses incurred by the Executive in the fulfillment of his duties hereunder upon presentation of written documentation thereof, in accordance with the applicable expense reimbursement policies and procedures of the Company as in effect from time to time.
(f)    Vacation.  The Executive shall be entitled to 20 days paid time off in accordance with the Company’s vacation policy (but which shall not be prorated for 2013) during each fiscal year of the Term, which may be carried over to the next fiscal year of the Term to the extent otherwise permitted under the Company’s vacation policy.
(g)    Legal Fees.  Upon presentation of appropriate documentation, the Company shall pay the Executive’s reasonable counsel fees incurred in connection with the negotiation and documentation of this Agreement, up to a maximum of $15,000.
(h)    Other Benefits and Perquisites.  The Executive shall be entitled to such other benefits and perquisites as may be available generally to other senior executives of the Company.  
		
	4.
	Termination of Employment.

(a)    Termination for Cause; Resignation without Good Reason.

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(i)    If the Company terminates the Executive’s employment for Cause, or if the Executive resigns from his employment hereunder other than for Good Reason, the Executive shall only be entitled to payment of any unpaid Base Salary through and including the date of termination or resignation, any unpaid expense reimbursement , any accrued but unused vacation, and any other amounts or benefits required to be paid under this Agreement through the date of termination or resignation, including but not limited to those under Sections 3(e), 3(g), and 3(h)  hereof (in each case only to the extent earned or accrued prior to such date of termination or resignation , or provided by law or under any plan, program, policy or practice of the Company (the “Other Accrued Compensation and Benefits”).  The Executive shall have no further right under this Agreement to receive any other compensation or benefits after such termination or resignation of employment.
(ii)    For purposes of this Agreement, “Cause” shall mean: (A) any act or omission that constitutes a material breach by the Executive of his obligations under this Agreement; (B) the willful and continued failure or refusal of the Executive (not as a consequence of illness, accident or other incapacity) to perform the duties reasonably required of him hereunder; (C) the Executive’s conviction of, or plea of nolo contendere to, (x) any felony or (y) another willful crime involving dishonesty or moral turpitude or which reflects negatively upon the Company and/or its subsidiaries or affiliates (collectively, the “Company Group”) in a material manner or otherwise materially impairs or impedes the operations of the Company Group; (D) the Executive’s engaging in any willful misconduct, gross negligence or act of dishonesty with regard to the Company Group or his material duties, which conduct is injurious to the Company Group; (E) the Executive’s material breach of either a material written policy of the Company Group or, to the extent the Executive is aware of such rules or has been informed by the Company’s counsel, the relevant rules of any governmental or regulatory body applicable to the Company Group; or (F) the Executive’s refusal to follow the lawful directions of the Board; provided, however, that no event or condition described in clauses (A), (B), (E) or (F) shall constitute Cause unless (i) the Company first gives the Executive written notice of its intention to terminate his employment for Cause and the grounds for such termination, and (ii) such grounds for termination (if susceptible to correction) are not corrected by the Executive within thirty (30) days of his receipt of such notice (or, in the event that such grounds cannot be corrected within such thirty (30) day period, the Executive has not taken all reasonable steps within such thirty (30) day period to correct such grounds as promptly as practicable thereafter).
(iii)    For purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following events without the Executive’s prior written consent: (A) a failure by the Company to timely pay material compensation due and payable to the Executive in connection with his employment; (B) a material diminution in the Executive’s Base Salary or TBO; (C) a material diminution of the authority, duties or responsibilities of the Executive from those set forth in this Agreement (excluding the Other Duties), including without limitation, ceasing to be the Chief Financial Officer and Treasurer of the Company (or its ultimate parent following a Change of Control); (D) the Company requiring the Executive to be based at any office or location more than fifty (50) miles from the Holmdel, New Jersey area; or (E) a material breach by the Company of its obligations under this Agreement; provided, however, that no event or condition described in clauses (A) through (E) shall constitute Good Reason unless (x) the Executive gives the Company within sixty (60) days of the occurrence of the Good Reason event, written notice of his intention to terminate his employment for Good Reason and the grounds for such termination, and (y) such grounds for termination (if susceptible to correction) are not corrected by the Company within thirty (30) days of its receipt of such notice (or, in the event that such grounds cannot be corrected within such thirty (30) day period, the Company has not taken all reasonable steps within such thirty (30) day period to correct such grounds as promptly as practicable thereafter). Such termination for Good Reason by the Executive must occur within 120 days of the occurrence of the Good Reason event.
(b)    Termination without Cause; Resignation for Good Reason.

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(i)    If the Executive’s employment is terminated by the Company without Cause or the Executive resigns for Good Reason, the Company shall pay the Executive, subject to Section 4(e) below: (A) severance pay equal to twelve (12) months of the Executive’s then-current Base Salary and an amount equal to the Executive’s full TBO for the year of termination payable by the Company in installments during its regular payroll cycle over the twelve (12) month period following the Executive’s termination of employment, provided that the first payment shall be made on the sixtieth (60th) day after the Executive’s termination of employment, and such first payment shall include payment of any amounts that would otherwise be due prior thereto, (B)  a pro rata portion of the Executive’s Annual Bonus for the year of termination, if and to the extent that the Company achieves its performance metrics for such year, payable when bonuses are normally paid to other senior executives of the Company, but in no event later than March 15th of the year following the year to which such bonus relates, and (C) the Other Accrued Compensation and Benefits.  The Executive shall have no further rights under this Agreement to receive any other compensation or benefits after such termination or resignation of employment.
(ii)    If, following a termination of employment without Cause or a resignation for Good Reason, the Executive materially breaches a provision of Section 5, Section 6 or Section 7 hereof, the Executive shall not be eligible, as of the date of such material breach, for the payments and benefits described in Sections 4(b)(i)(A) or (B) and any and all obligations and agreements of the Company with respect to such payments shall thereupon cease.
(c)    Termination Due to Death or Disability.  The Executive’s employment with the Company shall terminate automatically on the Executive’s death.  In the event of the Executive’s disability, the Company shall be entitled to terminate his employment.  In the event of termination of the Executive’s employment by reason of the Executive’s death or disability, the Company shall pay to the Executive (or his estate, as applicable), subject to Section 4(e) below, (i) a pro rata portion of the Executive’s Annual Bonus for the year of termination, if and to the extent that the Company achieves its performance metrics for such year, payable when bonuses are normally paid to other senior executives of the Company, but in no event later than March 15th of the year following the year to which such bonus relates, and (ii) the Other Accrued Compensation and Benefits.  For purposes of this Agreement, “disability” means that the Executive has been unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment for 180 days in any one (1) year period.  Notwithstanding the foregoing, in the event that as a result of absence because of mental or physical incapacity the Executive incurs a “separation from service” within the meaning of such term under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and guidance issued thereunder (“Section 409A”), the Executive shall on such date automatically be terminated from employment as a disability termination.
(d)    Release and Waiver.  The Company shall not be required to make the payments and provide the benefits provided for under Sections 4(b)(i)(A) or (B) or, in the case of a disability termination, Section 4(c)(i), unless the Executive (or, if applicable in the case of a disability termination, the person having legal power of attorney over his affairs) executes and delivers to the Company a Separation Agreement and General Release in substantially the form attached hereto as Exhibit B (the “Release”), and such Release has become effective and irrevocable in its entirety within sixty (60) days of the Executive’s termination of employment.
(e)    Payments Subject to Section 409A.  
(i)    The intent of the parties is that payments and benefits under this Agreement comply with Section 409A (except to the extent exempt as short-term deferrals or otherwise) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith.  If the Executive notifies the Company (with specificity as to the reason therefor) 

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that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Section 409A or the Company independently makes such determination, the Company shall, after consulting with the Executive, reform such provision to attempt to comply with Section 409A through good faith modifications to the minimum extent reasonably appropriate to conform with Section 409A.  To the extent that any provision hereof is modified in order to comply with Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A.  If the Executive notifies the Company (with specificity as to the reason therefor) that the Executive believes that any of the Company’s plans, programs or payroll practices would cause the Executive to incur any additional tax or interest under Section 409A, the Company shall in good faith discuss with the Executive any proposed modifications to such plans, programs or payroll practices that are reasonably necessary to comply with Section 409A.  Nothing contained herein shall constitute any representation or warranty by the Company regarding compliance with Section 409A and, notwithstanding anything else to the contrary herein, the members of the Company Group, and each of their respective employees or representatives, shall have no liability to the Executive with respect to the assessment of any additional income tax, interest or penalties under Section 409A.
(ii)    A termination of employment shall not be deemed to have occurred for purposes of this Agreement providing for the payment of any amounts or benefits that are considered “nonqualified deferred compensation” under Section 409A upon or following a termination of employment, unless such termination is also a “separation from service” from the Company within the meaning of Section 409A and the payment thereof prior to a “separation from service” from the Company would violate Section 409A.  As permitted by Treasury Regulation 1.409A-1(h)(1)(ii), 49% shall be substituted in lieu of 20% for the average level of bona fide services performed during the immediately preceding thirty-six (36) month period in order to constitute a “separation from service”.  For purposes of any provision of this Agreement relating to any such payments or benefits, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.”  Solely for purposes of this Section 4(e)(ii), “Company” shall include all persons with whom the Company would be considered a single employer under Sections 414(b) and 414(c) of the Code.
(iii)    For purposes of Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.  Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within thirty (30) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
(iv)    If, as of the date of the “separation from service” of the Executive from the Company, the Executive is a “specified employee” (within the meaning of that term under Section 409A(a)(2)(B)), then with regard to any payment or the provision of any benefit that is specified herein as subject to this Section or is otherwise considered “nonqualified deferred compensation” under Section 409A (whether under this Agreement, any other plan, program, payroll practice or any equity grant) and is payable upon the Executive’s separation from service, such payment or benefit shall not be made or provided until the date which is the earlier of  (A) the expiration of the six (6)-month-and-one-day period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death (the “Delay Period”) and this Agreement and each such plan, program, payroll practice or equity grant shall hereby be deemed amended accordingly.  Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum with interest at the prime rate as published in the Wall Street Journal on the first business day of the Delay Period (provided that any payment measured by a change in value that continues during 

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the Delay Period shall not be credited with interest for the Delay Period), and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(v)    All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A to the extent that such reimbursements or in-kind benefits are subject to Section 409A.  All expenses or other reimbursements paid pursuant hereto that are taxable income to the Executive shall in no event be paid later than the end of the calendar year next following the calendar year in which the Executive incurs such expense or pays such related tax.  With regard to any provision herein that provides for reimbursement of costs and expenses or in-kind benefits, except as permitted by Section 409A, the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause shall not be violated with regard to expenses reimbursed under any arrangement covered by Section 105(b) of the Code solely because such expenses are subject to a limit related to the period the arrangement is in effect and such payments shall be made on or before the last day of the Executive’s taxable year following the taxable year in which the expense occurred.  
(f)    Notice of Termination.  Any termination of employment by the Company or the Executive shall be communicated by a written “Notice of Termination” to the other party hereto given in accordance with Section 21 of this Agreement.  
(i)    By Company.  In the event of a termination by the Company for Cause, the Notice of Termination shall (A) indicate the specific termination provision in this Agreement relied upon, (B) set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (C) indicate the date on which such termination is effective (subject to applicable correction periods).  The failure by the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Cause shall not waive any right of the Company hereunder or preclude the Company from asserting such fact or circumstance in enforcing the Company’s rights hereunder to the extent that such fact or circumstance is on the same asserted basis within the definition for the termination.  In the event of a termination by the Company without Cause, the Notice of Termination shall specify the date of termination, which date shall not be more than thirty (30) days after the giving of such notice.
(ii)    By Executive.  In the event of a resignation by the Executive for Good Reason, the Notice of Termination shall (A) indicate the specific termination provision in this Agreement relied upon, (B) set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (C) specify the date of termination, which date shall not be more than thirty (30) days after the giving of such notice.  In the event of a resignation by the Executive other than for Good Reason, the Notice of Termination shall specify the date of termination, which date shall not be less than thirty (30) days after the giving of such notice.  The failure by the Executive to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason shall not waive any right of the Executive hereunder or preclude the Executive from asserting such fact or circumstance in enforcing the Executive’s rights hereunder to the extent that such fact or circumstance is on the same asserted basis within the definition for the termination.  In the event of a termination by the Executive without Good Reason, the Notice of Termination shall specify the date of termination, which date shall not be more than thirty (30) days after the giving of such notice.

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(g)    Resignation from Directorships and Officerships.  The termination of the Executive’s employment for any reason shall constitute the Executive’s resignation from (i) any director, officer, or employee position the Executive has with members of the Company Group, and (ii) all fiduciary positions (including as a trustee) the Executive holds with respect to any employee benefit plans or trusts established by any members of the Company Group.  The Executive agrees that this Agreement shall serve as written notice of resignation in this circumstance.
		
	5.
	Confidentiality.

(a)    Confidential Information.  The Executive has entered into and is subject to the Company’s Employee Confidentiality and Innovations Agreement substantially in the form attached hereto as Exhibit C.
(b)    Exclusive Property.  The Executive confirms that all Confidential Information (as defined in the Employee Confidentiality and Innovations Agreement) is and shall remain the exclusive property of the Company Group.  All business records, papers and documents kept or made by the Executive relating to the business of the Company Group shall be and remain the property of the Company Group.  Upon the request and at the expense of the Company Group, the Executive shall promptly make all disclosures, execute all instruments and papers, and perform all acts reasonably necessary to vest and confirm in the Company Group, fully and completely, all rights created or contemplated by this Section 5(b).  Notwithstanding the foregoing, the Executive shall maintain ownership and use of his rolodex and other address books.
6.Noncompetition.  The Executive has entered into and is subject to the Company’s Non-Compete Agreement substantially in the form attached hereto as Exhibit D.
7.Non-Solicitation and Non-Hire.  The Executive has agreed and now confirms that for a period commencing on the Effective Date and ending twelve (12) months following the Executive’s termination of employment with the Company (the “Restricted Period”), other than in the good faith performance of his duties to the Company as  Chief Financial Officer and Treasurer of the Company, the Executive shall not, directly or indirectly: (a) interfere with or attempt to interfere with the relationship between any person who is, or was during the then-most recent twelve (12) month period, an employee, officer, representative or agent of any member of the Company Group, or solicit or induce or attempt to solicit or induce any of them to leave the employ of any member of the Company Group or violate the terms of their respective contracts, or any employment arrangements, with any such entities; or (b) hire, recruit or attempt to hire any person who was employed by any member of the Company Group at any time during the then-most recent twelve (12) month period; provided, that this clause (b) shall not apply to the recruitment or hiring of any individual whose employment with any member of the Company Group has been terminated for a period of six (6) months or longer; or (c) induce or attempt to induce any customer, client, supplier, licensee or other business relation of any member of the Company Group to cease doing business with any member of the Company Group, or in any way interfere with the relationship between any member of the Company Group and any customer, client, supplier, licensee or other business relation of any member of the Company Group.  Nothing in this Section 7 shall be violated by the Executive serving upon request as a reference, so long as he does not have a business relationship with the person to whom the reference is being given, and nothing in this Section 7 shall be violated by the Executive engaging in general advertising that is not specifically targeted at the persons referred to in clauses (a), (b) and (c) that have a relationship with a member of the Company Group.  As used herein, the term “indirectly” shall include, without limitation, the Executive’s authorizing the use of the Executive’s name by any competitor of any member of the Company Group to induce or interfere with any employee or business relationship of any member of the Company Group. 
8.Certain Remedies.

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(a)    Injunctive Relief.  Without intending to limit the remedies available to either party hereto, including, but not limited to, those set forth in Section 11 hereof, each of the parties hereto agrees that a breach of any of the covenants contained in Sections 5, 6, or 7 of this Agreement may result in material and irreparable injury to the other party for which there is no adequate remedy at law, that it shall not be possible to measure damages for such injuries precisely and that, in the event of such a breach or threat thereof, any non-breaching party shall be entitled to seek a temporary restraining order or a preliminary or permanent injunction, or both, without bond or other security, restraining the breaching party from engaging in activities prohibited by the covenants contained in Sections 5, 6 or 7 of this Agreement or such other relief as may be required specifically to enforce any of the covenants contained in this Agreement.  Such injunctive relief in any court shall be available to the non-breaching party in lieu of, or prior to or pending determination in, any arbitration proceeding.
(b)    Extension of Restricted Period.  In addition to the remedies the Company may seek and obtain pursuant to Section 11 hereof, the Restricted Period may, in the court’s discretion, be extended by any and all periods during which the Executive shall be found by a court possessing personal jurisdiction over him to have been in violation of the covenants contained in Sections 5 through 7 of this Agreement.
9.Defense of Claims.  The Executive agrees that, during the Term, and for a period of six (6) months after termination of the Executive’s employment, upon request from the Company, the Executive shall cooperate with the Company in connection with any matters the Executive worked on during his employment with the Company and any related transitional matters.  In addition, the Executive agrees to cooperate with any member of the Company Group in the defense of any claims or actions that are made and/or may be made by or against any member of the Company Group, except if the Executive’s reasonable interests are adverse to the Company Group in such claim or action.  The Company agrees to promptly reimburse the Executive for all of the Executive’s reasonable travel and other direct expenses incurred, or to be reasonably incurred, to comply with the Executive’s obligations under this Section 9.
10.Source of Payments.  All payments provided under this Agreement, other than payments made pursuant to a plan which provides otherwise, shall be paid in cash from the general funds of the Company, and no special or separate fund shall be established, and no other segregation of assets shall be made, to assure payment.  The Executive shall have no right, title or interest whatsoever in or to any investments which the Company may make to aid the Company in meeting its obligations hereunder.  To the extent that any person acquires a right to receive payments from the Company hereunder, such right shall be no greater than the right of an unsecured creditor of the Company.
11.Arbitration.  Any dispute or controversy arising under or in connection with this Agreement or otherwise in connection with the Executive’s employment by the Company that cannot be mutually resolved by the parties to this Agreement and their respective advisors and representatives shall be settled exclusively by arbitration in New Jersey in accordance with the rules of the American Arbitration Association before one arbitrator of exemplary qualifications and stature, who shall be selected jointly by an individual to be designated by the Company and an individual to be selected by the Executive, or if such two individuals cannot promptly agree on the selection of the arbitrator, who shall be selected by the American Arbitration Association.  The award of the arbitrator with respect to such dispute or controversy shall be in writing with sufficient explanation to allow for such meaningful judicial review as is permitted by law, and that such decision shall be enforceable in any court of competent jurisdiction and shall be binding on the parties hereto.  The remedies available in arbitration shall be identical to those allowed at law.  The arbitrator shall be entitled to award to the prevailing party in any arbitration or judicial action under this Agreement reasonable attorneys’ fees and any costs of the arbitration payable by such party, consistent with applicable law; provided, that no such award shall be made against the Executive unless the arbitrator finds the Executive’s positions in such arbitration or dispute to have been frivolous or in bad faith.

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12.Nonassignability; Binding Agreement.  
(a)    By the Executive.  This Agreement and any and all of the Executive’s rights, duties, obligations or interests hereunder shall not be assignable or delegable by the Executive.
(b)    By the Company.  This Agreement and any and all of the Company’s rights, duties, obligations or interests hereunder shall not be assignable by the Company, except as incident to a reorganization, merger or consolidation, or transfer of all or substantially all of the Company’s assets and then only if the Company’s obligations hereunder are assumed by the assignee.
(c)    Binding Effect.  This Agreement shall be binding upon, and inure to the benefit of, the parties hereto, any successors to or permitted assigns of the Company, and the Executive’s heirs and the personal representatives of the Executive’s estate.
13.Withholding.  Any payments made or benefits provided to the Executive under this Agreement shall be reduced by any applicable withholding taxes or other amounts required to be withheld by law or contract.
14.Certain Payments.
(a)    Modified Cutback.  If any payment, benefit or distribution of any type to or for the benefit of the Executive, whether paid or payable, provided or to be provided, or distributed or distributable pursuant to the terms of this Agreement or otherwise (collectively, the “Parachute Payments”) would subject the Executive to the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), the Parachute Payments shall be reduced so that the maximum amount of the Parachute Payments (after reduction) shall be one dollar ($1.00) less than the amount which would cause the Parachute Payments to be subject to the Excise Tax; provided, that the Parachute Payments shall only be reduced to the extent the after-tax value of amounts received by the Executive after application of the above reduction would exceed the after-tax value of the amounts received without application of such reduction.  For this purpose, the after-tax value of an amount shall be determined taking into account all Federal, state, and local income, employment and excise taxes applicable to such amount.  If a reduction in the Parachute Payments is required hereunder, the Company shall reduce or eliminate the Parachute Payments by first reducing or eliminating any cash severance benefits (with the payments to be made furthest in the future being reduced first), then by reducing or eliminating any accelerated vesting of stock options or similar awards, then by reducing or eliminating any accelerated vesting of restricted stock or similar awards, then by reducing or eliminating any other remaining Parachute Payments; provided, that no such reduction or elimination shall apply to any non-qualified deferred compensation amounts (within the meaning of Section 409A) to the extent such reduction or elimination would accelerate or defer the timing of such payment in manner that does not comply with Section 409A.
(b)    Determinations.  An initial determination as to whether (i) any of the Parachute Payments received by the Executive in connection with the occurrence of a change in the ownership or control of the Company or in the ownership of a substantial portion of the assets of the Company shall be subject to the Excise Tax, and (ii) the amount of any reduction, if any, that may be required pursuant to subsection (a) above, shall be made by an independent accounting firm selected by the Company and reasonably acceptable to Executive (the “Accounting Firm”) prior to the consummation of such change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company.  The Executive shall be furnished with notice of all determinations made as to the Excise Tax potentially payable with respect to the Executive’s Parachute Payments, together with the related calculations of the Accounting Firm, promptly after such determinations and calculations have been received by the Company.

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15.Amendment; Waiver.  This Agreement may not be modified, amended or waived in any manner, except by an instrument in writing signed by both parties hereto.  The waiver by either party of compliance with any provision of this Agreement by the other party shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by such party of a provision of this Agreement.
16.Governing Law.  All matters affecting this Agreement, including the validity thereof, are to be governed by, and interpreted and construed in accordance with, the laws of the State of New Jersey applicable to contracts executed in and to be performed in that State.
17.Survival of Certain Provisions.  The rights and obligations set forth in Section 3(b), Sections 4 through 11, and 14 hereof shall survive any termination or expiration of this Agreement.
18.Entire Agreement; Supersedes Previous Agreements.  This Agreement, together with the (i) Employee Confidentiality and Innovations Agreement, (ii) Non-Compete Agreement, (iii) 2006 Incentive Plan, (iv) Stock Option Agreement, and (v) the Indemnification Agreement, dated as of April 25, 2013, between the Company and the Executive, each as amended from time to time, contains the entire agreement and understanding of the parties hereto with respect to the matters covered herein and supersedes all prior or contemporaneous negotiations, commitments, agreements and writings with respect to the subject matter hereof, including, without limitation, the cover letter and employment agreement term sheet dated as of March 12, 2013.  All such other negotiations, commitments, agreements and writings shall have no further force or effect, and the parties to any such other negotiation, commitment, agreement or writing shall have no further rights or obligations thereunder.  
19.Counterparts.  This Agreement may be executed by either of the parties hereto in counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.
20.Headings.  The headings of sections herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.
21.Notices.  All notices or communications hereunder shall be in writing, addressed as follows:
To the Company:
23 Main Street 
Holmdel, N.J.  07733 
Attention:  Chief Legal Officer
To the Executive:
David T. Pearson 
at the last address on record with the Company;
with copy to:
David E. Rubinsky  
Simpson Thacher & Bartlett LLP 
425 Lexington Avenue 
New York, NY 10017 

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Email: drubinsky@stblaw.com 
Fax: (212) 455-2502
All such notices shall be conclusively deemed to be received and shall be effective (i) if sent by hand delivery, upon receipt, or (ii) if sent by electronic mail or facsimile, upon confirmation of receipt by the sender of such transmission, or (iii) if sent by courier or certified or registered U.S. mail, upon receipt.
22.Severability.  In the event that any court having jurisdiction shall determine that any restrictive covenant or other provision contained in this Agreement shall be unreasonable or unenforceable in any respect, then such covenant or other provision shall be deemed limited to the extent that such other court deems it reasonable or enforceable, and as so limited shall remain in full force and effect.  In the event that such court shall deem any such covenant or other provision wholly unenforceable, the remaining covenants and other provisions of this Agreement shall nevertheless remain in full force and effect.
[Remainder of page intentionally left blank.]

12

 IN WITNESS WHEREOF, the Company has caused this Agreement to be signed by its officer pursuant to the authority of its Board, and the Executive has executed this Agreement, as of the day and year first written above.
VONAGE HOLDINGS CORP.
By  ___/s/ Marc P. Lefar ____________ 
Name:  Marc P. Lefar 
Title:  Chief Executive Officer
ACCEPTED AND AGREED:
__/s/ David T. Pearson  
David T. Pearson
Date:  April 25, 2013

[SIGNATURE PAGE TO PEARSON EMPLOYMENT AGREEMENT]

Exhibit A
Stock Option Agreement

VONAGE HOLDINGS CORP. 
2006 INCENTIVE PLAN 
NONQUALIFIED STOCK OPTION AGREEMENT 
“Participant”: David T. Pearson 
“Date of Award”: May 3, 2013 
This Agreement (the “Agreement”), effective as of the Date of Award set forth above, represents the grant of Nonqualified Stock Options by Vonage Holdings Corp., a Delaware corporation (the ”Company”), to the Participant named above, pursuant to the provisions of the Vonage Holdings Corp. 2006 Incentive Plan, as amended or restated from time to time, (the ”Plan”). Capitalized terms have the meanings ascribed to them under the Plan, unless specifically set forth herein. 
The parties hereto agree as follows: 
 
	
			
	 
	1.
	Grant of Options

The Company hereby grants to the Participant Nonqualified Stock Options to purchase Shares in the manner and subject to the terms and conditions of the Plan and this Agreement as follows: 
(a)Number of Shares Covered by the Options: 2,000,000. 
(b)“Option Price”: $ [          ] per Share.
(c)“Option Term”: The Options have been granted for a period of ten years, ending on the tenth anniversary of the Date of Award. 
 
	
			
	 
	2.
	Vesting of Options

(a)Except as otherwise provided in this Section 2, the Options shall vest and become exercisable as to 1/4th of the Shares on each of the first, second, third and fourth anniversaries of the Date of the Award (each, a “Vesting Date”), subject to the Participant’s continued employment with the Company on the applicable Vesting Date, except as otherwise provided for herein. 
(b)To the extent not previously vested in accordance with this Section 2, in the event the Participant’s employment is terminated without Cause by the Company, for Good Reason by the Participant, or due to the Participant’s death or disability, in each case, on or prior to the first (1st) anniversary of a Change of Control (which, for purposes of this Agreement, shall have the meaning set forth in Section 3(b) (or any successor section thereto) of that certain Employment Agreement, dated as of April 25, 2013, by and between the Company and the Participant, as such agreement may be amended from time to time (the “Employment Agreement”)), the Options will fully vest and become exercisable upon such termination of employment. 
(c)To the extent not previously vested in accordance with this Section 2, in the event of a termination of the Participant’s employment without “Cause” by the Company or by the Participant for “Good Reason” (other than on or prior to the first (1st) anniversary of a Change of Control), (i) an additional amount of the then outstanding Options granted by the Company to the Participant pursuant to this Agreement shall become vested and immediately exercisable as of the date of such 

US_ACTIVE:\44218152\7\79143.0003

termination in accordance with the provisions of the immediately following sentence and (ii) remain exercisable until they terminate in accordance with Section 4 below.  For each outstanding Option, such additional amount shall be equal to the number of Options that would have vested on the next Vesting Date immediately following the date of termination, multiplied by a fraction where (1) the numerator is  the number of full and fractional months that had elapsed between the Vesting Date immediately prior to such termination and such termination date plus the number of full and fractional months remaining in the calendar quarter that includes such termination date, and (2) the denominator is 12.  Notwithstanding the foregoing, in no event shall the number of Options vesting pursuant to this Section 2(c) exceed the number of Options that would have vested on the next Vesting Date immediately following the date of termination.
(d)    To the extent not previously vested in accordance with this Section 2, in the event of the Participant’s death (other than on or prior to the first (1st) anniversary of a Change of Control), the Options will (i) vest and become exercisable as of the date thereof as to one-half the number of unvested Shares covered thereby and (ii) remain exercisable until they terminate in accordance with Section 4 below.
(e)    To the extent not previously vested in accordance with this Section 2, in the event of the Participant’s disability (other than on or prior to the first (1st) anniversary of a Change of Control), the Options will (i) vest and become exercisable as of the date thereof as to one-half the number of unvested Shares covered thereby and (ii) remain exercisable until they terminate in accordance with Section 4 below.
(f)     Notwithstanding anything to the contrary herein, if the Participant’s employment with the Company is terminated by the Company with Cause, the Options will terminate immediately and be of no force or effect. 
(g)    To the extent vested in accordance with this Section 2, the Options will remain exercisable until they terminate in accordance with Section 4 below. 
(i)    For purposes of this Section 2, the terms “Cause,” “Good Reason” and “disability” shall have the respective meanings ascribed to them in the Employment Agreement.
 
	
			
	 
	3.
	Exercise of Options

The Options may be exercised by any means specified in Section 7(d) of the Plan, as well as by a broker cashless exercise procedure, all of which the Committee hereby approves. 
 
	
			
	 
	4.
	Termination of Options

To the extent vested in accordance with Section 2 above, the Options will terminate, and be of no force or effect, upon the earliest of: 
(a)the date of termination of the Participant’s employment if such termination of employment is for Cause, 
(b)180 days following termination of Participant’s employment by the Company without Cause or by the Participant for Good Reason, 
(c)60 days following termination of Participant’s employment due to the Participant’s resignation without Good Reason, and
(d)the expiration of the Option Term. 

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US_ACTIVE:\44218152\7\79143.0003

	
			
	 
	5.
	Rights as Stockholder

The Participant shall have no rights as a stockholder of the Company with respect to the Shares covered by the Options until such time as the Option Price has been paid and the Shares have been issued and delivered to the Participant. 
 
	
			
	 
	6.
	Transferability 

Unless permitted by the Committee in accordance with the terms of the Plan, the Options may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution, and, during the Participant’s lifetime, may be exercised only by the Participant or in the event of the Participant’s legal incapacity, the Participant’s legal guardian or representative. 
 
	
			
	 
	7.
	Miscellaneous 

(a)This Agreement and the rights of the Participant hereunder are subject to the terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for administration of the Plan. If there is any inconsistency between the terms of this Agreement and the terms of the Plan, the Plan’s terms shall completely supersede and replace the conflicting terms of this Agreement. 
(b)This Agreement shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required or, the Committee determines are advisable. The Participant agrees to take all steps the Company determines are necessary to comply with all applicable provisions of federal and state securities law in exercising his rights under this Agreement. The Committee shall have the right to impose such restrictions on any Shares acquired pursuant to the exercise of the Option as it deems necessary or advisable under applicable federal securities laws, the rules and regulations of any stock exchange or market upon which Shares are then listed or traded, and/or any blue sky or state securities laws applicable to Shares. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant. 

(c)The Options are intended not to provide for a “deferral of compensation” within the meaning of Section 409A of the Code. Notwithstanding the forgoing or any provision of the Plan or this Agreement, if any provision of this Agreement or the Plan contravenes Section 409A of the Code or could cause the Participant to incur any tax, interest or penalties under Section 409A of the Code, the Committee may, in its sole discretion and without the Participant’s consent, modify such provision in order to comply with the requirements of Section 409A of the Code or to satisfy the conditions of any exception therefrom, or otherwise to avoid the imposition of the additional income tax and interest under Section 409A of the Code, while maintaining, to the maximum extent practicable, the original intent and economic benefit to the Participant, without materially increasing the cost to the Company, of the applicable provision. 
(d)Delivery of the Shares underlying the Options upon exercise will be subject to the Participant satisfying all applicable federal, state, local and foreign taxes. The Company shall have authority to deduct or withhold from all amounts payable to the Participant in connection with the Options, or require the Participant to remit to the Company, an amount sufficient to satisfy any applicable taxes required by law. The Participant shall have the right to cover the minimum statutory withholding by directing the Company to withhold Shares that would otherwise be received by him, by utilization of a cashless broker transaction or by any other means permitted by Section 18 of the Plan. 

16
US_ACTIVE:\44218152\7\79143.0003

(e)To the extent not preempted by federal law, this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. 

[SIGNATURE PAGE FOLLOWS]

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US_ACTIVE:\44218152\7\79143.0003

IN WITNESS WHEREOF, the Company and the Participant have executed this Agreement as of the Date of Award. 
 

VONAGE HOLDINGS CORP.

By:________________________________
Name:
Title:

PARTICIPANT

___________________________________
Name: David T. Pearson
Title:    Chief Financial Officer and Treasurer
 

Exhibit B
Separation Agreement and General Release

CONFIDENTIAL SEPARATION AGREEMENT AND GENERAL RELEASE 
This CONFIDENTIAL SEPARATION AGREEMENT and GENERAL RELEASE (hereinafter referred to as this “Agreement”) is made and entered into by and between David T. Pearson (“Executive”) and Vonage Holdings Corp. (defined herein to include its affiliates, subsidiaries, predecessors and successors and hereinafter referred to as “Vonage” or “the Company”), effective as of [            ] (the “Effective Date”). Executive and Vonage are hereafter referred to as the “Parties.” 
WHEREAS, Executive was employed by Vonage as its Chief Financial Officer and Treasurer; 
WHEREAS, Executive and Vonage entered into an Employment Agreement, dated as of April 25, 2013 (the “Employment Agreement”); 
WHEREAS, [description of nature of termination]; 
WHEREAS, Vonage and Executive have read this Agreement and have had the opportunity to review it with their respective legal counsel; and 
WHEREAS, Vonage and Executive desire to resolve any and all issues and claims between them, including without limitation Executive’s employment and his separation therefrom, as well as any and all issues and claims arising from or relating to the Employment Agreement, and to reach an amicable accord and settlement concerning their future relationship. 
NOW, THEREFORE, in consideration of the premises and mutual promises herein contained, it is agreed as follows: 
1.Separation and Post-Employment Benefits. Executive ceased performing duties for Vonage on [            ] (the “Termination Date”), and Executive’s services on any and all boards of directors, boards of trustees and executive and/or management committees of Vonage of which he was a member ended on such date. The terms of Executive’s separation from Vonage are now being agreed to, as described herein. 
2.Salary. Executive agrees that Vonage has no obligation to make, and will not make, any additional salary payments to Executive that have not already been paid, except for any and all earned, accrued or owed amounts, but not yet paid, to which Executive is entitled up to and including the Termination Date, including any unpaid expense reimbursement , any accrued but unused vacation and any other amounts or benefits required to be paid under the Employment Agreement or provided by law or under any plan, program, policy or practice of Vonage and not including the payments or benefits described in Paragraph 5 below (“Other Accrued Compensation and Benefits”), payable in a lump sum within five (5) days after the revocation period described in Paragraph 18(d) below.  Any further entitlement that Executive may have to compensation or benefits, such as the payments and benefits described in Paragraph 5 below, shall be governed by the terms of this Agreement. 
3.Non-Admission. It is specifically understood and agreed that this Agreement does not constitute and is not to be construed as an admission or evidence of (a) any violation by Vonage or Executive, of any federal, state or municipal law, statute or regulation, or principle of common law or equity, (b) the commission by Executive or Vonage of any other actionable wrong, or (c) any wrongdoing of any kind whatsoever on the part of Executive or Vonage, and shall not be offered, argued or used for that purpose.
4.General Release. 

(a)In exchange for the consideration provided in this Agreement, and as a material inducement for both Parties entering into this Agreement, Executive for himself, his heirs, executors, administrators, trustees, legal representatives, successors and assigns (hereinafter collectively referred to for purposes of this Paragraph 4 as “Executive”) hereby irrevocably and unconditionally waives, releases and forever discharges Vonage and its past, present and future affiliates and related entities, parent and subsidiary corporations, divisions, shareholders, predecessors, future officers, directors, trustees, fiduciaries, administrators, executives, agents, representatives, successors and assigns (hereinafter collectively referred to for purposes of this Paragraph 4 as “Vonage”) for any and all waivable claims, charges, demands, sums of money, actions, rights, promises, agreements, causes of action, obligations and liabilities of any kind or nature whatsoever, at law or in equity, whether known or unknown, existing or contingent, suspected or unsuspected, apparent or concealed, foreign or domestic (hereinafter collectively referred to as “claims”) which he has now or in the future may claim to have against Vonage based upon or arising out of any facts, acts, conduct, omissions, transactions, occurrences, contracts, claims, events, causes, matters or things of any conceivable kind or character existing or occurring or claimed to exist or to have occurred prior to the Effective Date in any way whatsoever relating to or arising out of Executive’s employment with Vonage or the termination thereof. Such claims include, but are not limited to, claims arising under the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq.; Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.; the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq.; the Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq.; the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq.; the Equal Pay Act of 1963, 29 U.S.C. § 206(d); Section 806 of the Corporate and Criminal Fraud Accountability Act of 2002, 18 U.S.C. § 1681 et seq.; the Fair Credit Reporting Act, 15 U.S.C. §1681 et seq.; any other federal, state or local statutory laws relating to employment, discrimination in employment, termination of employment, wages, benefits or otherwise, including, but not limited to, the New Jersey Law Against Discrimination, the Conscientious Employee Protection Act, the New Jersey Wage Payment Law, the New Jersey Family Leave Act, all as amended; the common law of the State of New Jersey; any claim under any local ordinance, including, but not limited to, any ordinance addressing fair employment practices; any claims for employment or reemployment by the Company; any common law claims, including but not limited to actions in tort, defamation and breach of contract; any claim or damage arising out of Executive’s employment with or separation from Vonage (including a claim for retaliation) under any common law theory or any federal, state or local statute or ordinance not expressly referenced above; and any and all claims for counsel fees and costs. 
(b)To the fullest extent permitted by law, and subject to the provisions of Paragraphs 4(d) and 4(e) below, Executive represents and affirms that he has not filed or caused to be filed on his behalf any claim for relief against Vonage or any releasee and, to the best of his knowledge and belief, no outstanding claims for relief have been filed or asserted against Vonage or any releasee on his behalf. 
(c)In waiving and releasing any and all waivable claims whether or not now known, Executive understands that this means that, if he later discovers facts different from or in addition to those facts currently known by him, or believed by him to be true, the waivers and releases of this Agreement will remain effective in all respects — despite such different or additional facts and his later discovery of such facts, even if he would not have agreed to this Agreement if he had prior knowledge of such facts. 
(d)Nothing in this Paragraph, or elsewhere in this Agreement, prevents or prohibits Executive from filing a claim with a government agency, such as the U.S. Equal Employment Opportunity Commission, that is responsible for enforcing a law on behalf of the government. However, Executive understands that, because Executive is waiving and releasing, among other things, any and all claims for monetary damages and any other form of personal relief (per Paragraph 4(a) above), Executive may only seek and receive non-monetary forms of relief through any such claim. 
(e)Nothing in this Paragraph, or elsewhere in this Agreement, is intended as, or shall be deemed or operate as, a release by Executive of his rights under the Parties’ Indemnification Agreement, 

dated as of April 25, 2013, as amended from time to time (the “Indemnification Agreement”), or any other rights to indemnification relating to his performance of services as an officer  of Vonage, including but not limited to those rights to indemnification set forth in Vonage’s Certificate of Incorporation as in effect on the date hereof (the “Certificate of Incorporation”). Notwithstanding the foregoing, the provisions of this Paragraph 4(e) are intended as recitals only and are not intended to provide Executive with any additional contractual rights beyond those contained in the Indemnification Agreement or the Certificate of Incorporation. Furthermore, nothing herein shall affect Executive’s rights to Other Accrued Compensation and Benefits in accordance with the terms of this Agreement or as provided in Section 6 hereof. 
5.Consideration and Post-Employment Benefits. 
(a)    Vonage, for and in consideration of the undertakings of Executive set forth herein and pursuant to Paragraph 4(b)(i) of the Employment Agreement, and intending to be legally bound, and provided that Executive does not revoke this Agreement pursuant to Paragraph 18(d) below, agrees that Vonage will pay or provide the following to Executive, subject to Section 4(d) of the Employment Agreement: (1) severance pay equal to twelve (12) months of the Executive’s Base Salary (as defined in Paragraph 3(a) of the Employment Agreement) and an amount equal to the Executive’s full TBO (as defined in Paragraph 3(c) of the Employment Agreement) for the year of termination, each payable by the Company in installments during its regular payroll cycle over the twelve (12) month period following the Executive’s termination of employment, provided that the first payment shall be made on the sixtieth (60th) day after the Executive’s termination of employment, and such first payment shall include payment of any amounts that would otherwise be due prior thereto, and (2) a pro rata portion of the Executive’s Annual Bonus (as defined in Paragraph 3(c) of the Employment Agreement) for the year of termination, if and to the extent that the Company achieves its performance metrics for such year, payable when bonuses are normally paid to other senior executives of the Company, but in no event later than March 15th of the year following the year to which such bonus relates.  All payments are subject to applicable tax withholding. Executive shall be solely responsible for all taxes on the payments under this Agreement.
(b)    Notwithstanding anything to the contrary herein, if Executive materially breaches provisions of Vonage’s Employee Confidentiality and Innovations Agreement, dated as of April 25, 2013 (the “Confidentiality Agreement”), Vonage’s Non-Compete Agreement, dated as of April 25, 2013 (the “Non-Compete Agreement”), or Section 7 of the Employment Agreement, Executive shall not be eligible, as of the date of such material breach, for the payments and benefits described in Paragraph 5(a) above, and any and all obligations and agreements of Vonage with respect to such payments shall thereupon cease (and Vonage shall be entitled to recoup any and all such payments and benefits previously paid or awarded to Executive). 
(c)    In accordance with the provisions of Section 3(b) of the Employment Agreement, the Vonage Holdings Corp. 2006 Incentive Plan, as amended or restated from time to time (the “2006 Incentive Plan”) and the Executive’s individual stock option agreement (the “Stock Option Agreement”), the Parties agree that the equity described in those agreements shall vest and become exercisable in accordance with Section 3(b) of the Employment Agreement (the “Vested Equity”).  Other than the Vested Equity, all equity awarded by Vonage to Executive has terminated and is of no further force or effect.
6.Prior Agreements. This Agreement supersedes all prior agreements entered into by Vonage and Executive, except for the following: (1) Section 3(b), Sections 4 through 11 and Section 14 of the Employment Agreement, which terms survive the termination of the Employment Agreement pursuant to Section 17 thereof, (2) the Non-Compete Agreement, (3) the Confidentiality Agreement, (4) the Stock Option Agreements, and (5) the Indemnification Agreement. [List other appropriate agreements between Vonage and Executive.]
7.Resignation from Directorships and Officerships. Pursuant to Paragraph 4(g) of the Employment Agreement, Executive affirms that the termination of Executive’s employment by the 

Executive or the Company for any reasons shall constitute the Executive’s resignation from (i) any director, officer or employee position the Executive has with the Company, and (ii) all fiduciary positions (including as a trustee) the Executive holds with respect to any employee benefit plans or trusts established by the Company.  
8.Confidentiality of Agreement. Executive agrees to keep secret and strictly confidential the terms of this Agreement (except to the extent this Agreement is publicly filed) and further represents and warrants that he will not disclose, make known, discuss or relay any information concerning this Agreement, or any of the discussions leading up to this Agreement, to anyone (other than members of his immediate family, accountants or attorneys who have first agreed to keep said information confidential and to not disclose it to others), and that he has not done so. The foregoing shall not prohibit or restrict such disclosure as required by law or in connection with Vonage’s filings with the Securities and Exchange Commission or any other governmental or regulatory body or as may be necessary for the prosecution or defense of claims relating to the performance or enforcement of this Agreement or prohibit or restrict Executive (or Executive’s attorney) or Vonage from responding to any such inquiry about this settlement or its underlying facts and circumstances by the Securities and Exchange Commission, the New York Stock Exchange, any other self-regulatory organization, or in response to a duly served and effective subpoena or discovery request in the course of any litigation. Prior to making any disclosure other than to his immediate family, accountants or attorneys, Executive shall provide Vonage with as much notice as practicable that he has been requested or compelled to make disclosure and shall cooperate with Vonage to maintain the confidentiality of this Agreement to the fullest extent possible. 
9.Return of Property and Documents. Executive represents and warrants that he has returned, or will immediately return, to Vonage all Vonage property (including, without limitation, any and all computers, BlackBerries, cell phones, identification cards, card key passes, corporate credit cards, corporate phone cards, files, memoranda, keys and software) in Executive’s possession and that he has not, and will not, retain any duplicates or reproductions of such items. Executive further represents and warrants that he has delivered to Vonage all copies of any Confidential Information (as defined in the Confidentiality Agreement) in his possession or control and has destroyed all copies of any analyses, compilations, studies or other documents in his possession that contain any Confidential Information. Notwithstanding the foregoing, Executive shall maintain ownership and use of his rolodex and other address books, and Vonage agrees to cooperate with Executive in the transfer to Executive of cell phone and BlackBerry numbers used by Executive if such numbers are registered in Vonage’s name. 
10.Notices. All notices, requests, demands and other communications hereunder to Vonage shall be in writing and shall be delivered, either by hand, by facsimile, by overnight courier or by certified mail, return receipt requested, duly addressed as indicated below or to such changed address as Vonage may subsequently designate: 
Vonage Holdings Corp. 
23 Main Street 
Holmdel, New Jersey 07733 
Attention: Office of Chief Legal Officer 
 
Any such notice, request, demand or other communication to Vonage delivered in the manner specified above shall be deemed duly given only upon receipt by Vonage. 
All notices, requests, demands and other communications hereunder to Executive shall be in writing and shall be delivered, either by hand, by facsimile, by overnight courier, or by certified mail, return receipt requested, duly addressed as indicated below or to such changed address as Executive may subsequently designate: 
David T. Pearson
at the last address on record with Vonage 

Any such notice, request, demand or other communication to Executive delivered in the manner specified above shall be deemed duly given only upon receipt by Executive. 
11.Severability. If, at any time after the Effective Date, any provision of this Agreement shall be held by any court of competent jurisdiction or arbitrator to be illegal, void or unenforceable, such provision shall be of no force and effect. The illegality or unenforceability of such provision, however, shall have no effect upon, and shall not impair the enforceability of, any other provision of this Agreement, provided, however, that upon finding that Paragraph 4(a) is illegal and/or unenforceable, Vonage shall be released from any obligation to make any payment pursuant to Paragraph 5 of this Agreement, and Executive shall repay to Vonage any and all amounts already received pursuant to Paragraph 5. 
12.Choice of Law; Arbitration. The terms of this Agreement and all rights and obligations of the Parties, including its enforcement, shall be interpreted and governed by the laws of the State of New Jersey, without regard to conflicts of law principles. Pursuant to Section 11 of the Employment Agreement, which is incorporated by operation thereof and reference herein, any disputes arising out of this Agreement and which are mandatorily arbitrable shall be settled exclusively by arbitration before the American Arbitration Association at a location in New Jersey. 
13.Injunctive Relief. Notwithstanding the limited agreement to arbitrate set forth in Paragraph 12 of this Agreement, any claim alleging breach of Paragraph 8 of this Agreement, alleging breach of Sections 5, 6 or 7 of the Employment Agreement, or alleging breach of the Confidentiality Agreement or Non-Compete Agreement may be brought in any federal or state court of competent jurisdiction in the State of New Jersey, where the parties consent to jurisdiction and agree not to argue that it is an inconvenient forum for resolution of the claim.  In accordance with Section 8 of the Employment Agreement and this Paragraph 13 of the Agreement, a material breach of Section 5, 6 or 7 of the Employment Agreement, of Paragraph 8 of this Agreement, or of the Confidentiality Agreement or Non-Compete Agreement shall be considered to be irreparable harm, where no adequate remedy at law would be available in respect thereof. The Parties agree that neither Party will have any obligation to post a bond to obtain said injunctive relief. 
14.Modification of Agreement. No provision of this Agreement may be modified, altered, waived or discharged unless such modification, alteration, waiver or discharge is agreed to in writing and signed by the Parties hereto. No waiver by either Party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other Party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. 
15.Withholding. Vonage may withhold from amounts payable or benefits provided under this Agreement any and all federal, state and local taxes that are required to be withheld and reported by any applicable laws and regulations. Vonage may also withhold and report any amounts necessary pursuant to the benefit plans, policies or arrangements of Vonage or otherwise, in accordance with any applicable Vonage policies, laws and/or regulations. 
16.Entire Agreement; Headings. Other than as set forth in Paragraph 6 hereof, this Agreement sets forth the entire agreement between the Parties hereto and any and all prior and contemporaneous agreements, discussions or understandings between the Parties pertaining to the subject matter hereof, including relating to severance payments or compensation, have been and are merged into and superseded by this Agreement. The headings of the sections contained in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this Agreement. 
17.Counterparts. This Agreement may be executed in several counterparts, each of which will be deemed an original, but all of which will constitute one and the same instrument. 
18.EXECUTIVE ACKNOWLEDGES AND WARRANTS THAT: 

(a)    he has read the terms of this Agreement and that he understands its terms and effects, including the fact that he has agreed to release and forever discharge Vonage or any releasee from any legal action arising out of his employment relationship with Vonage, the terms and conditions of that employment relationship, and the termination of that employment relationship; 
(b)    he has signed this Agreement voluntarily and knowingly in exchange for the consideration described and referenced herein, which he acknowledges as adequate and satisfactory to him; 
(c)    he has been informed that he has the right to consider this Agreement for a period of twenty-one (21) days from receipt prior to entering into this Agreement and he has signed on the date indicated below after concluding that this Agreement is satisfactory; 
(d)    he has been informed that he has the right to revoke this Agreement for a period of seven (7) days following his execution of this Agreement by giving written notice to Vonage to the attention of Office of Chief Legal Officer, Vonage Holdings Corp., 23 Main Street, Holmdel, New Jersey 07733. This Agreement shall not be effective or enforceable until Executive’s right to revoke this Agreement has lapsed; 
(e)    he has been and is hereby advised in writing by Vonage to consult with an attorney prior to signing this Agreement and he has consulted with his attorney and fully discussed and reviewed the terms of this Agreement with his attorney; 
(f)    neither Vonage, nor any of its agents, representatives or attorneys have made any representations to Executive concerning the terms or effects of this Agreement other than those contained and referenced herein; and 
(g)    this Agreement shall be governed, interpreted and enforced by and under the laws of the State of New Jersey, without regard to choice of law principles. 
 
	
									
	 
	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	VONAGE HOLDINGS CORP.

	 
	 
	 
	 
	 

	By:
	 
	 
	 
	 
	 
	By:
	 
	 

	 
	 
	David T. Pearson
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	Dated:
	 
	 
	 
	 
	 
	Dated:
	 
	 

 

Exhibit C
Employee Confidentiality and Innovations Agreement

Exhibit D
Non-Compete Agreement

NON-COMPETE AGREEMENT
AGREEMENT, dated this 25the day of April, 2013, by and between Vonage Holdings Corp.  and its subsidiaries, a Delaware corporation with principal executive offices at 23 Main Street, Holmdel, New Jersey 07733 (“Vonage”), and David T. Pearson (“Employee”).
In consideration of Employee’s employment with Vonage or continued employment with Vonage, as the case may be, Employee agrees to be bound by the terms of this Non-Compete Agreement (“Agreement”) as follows:

Restriction on Competition.  During the period of Employee’s employment with Vonage and for a period of twelve (12) months thereafter, Employee will not provide services to the portion of any entity that sells and markets residential/home broadband connectivity or broadband voice service (a “Competitive Entity”) as an employee thereof or as a direct individual consultant thereto (or through an entity specifically formed for the purpose of evading the limitations hereof) anywhere within the “Territory,” that term meaning within the United States, Canada, and Brazil, in those States and provinces (or States and provinces contiguous thereto) in which Vonage conducts or is substantially prepared to conduct its business on the date of Employee’s employment termination.  Nothing contained in this Section 1 shall be deemed to prohibit Employee from acquiring or holding, solely for investment, publicly traded securities of a Competitive Entity, provided such securities do not, in the aggregate, constitute more than five percent (5%) of any class or series of outstanding securities of such Competitive Entity.
Specific Remedies.  If Employee commits a breach of any of the provisions of Section 1, Vonage shall have the right to have such provisions specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach will cause irreparable injury to Vonage and that money damages will not provide an adequate remedy.
		
	Independence,
	Severability and Non-Exclusivity.  The right enumerated in Section 2 shall be in addition to and not in lieu of any other rights and remedies available to Vonage at law or in equity.  If any of the covenants contained in Section 1 (“Covenants”) or any part of any of them, is found by a court of competent jurisdiction to be invalid or unenforceable, this shall not affect the remainder, or rights or remedies under this Agreement, which shall be given full effect without regard to the invalid portions.  The parties intend to and do hereby confer jurisdiction on courts located within the geographical scope of the Covenants.  If any of the Covenants is held to be invalid or unenforceable because of the duration or geographical area, the parties agree that the court making such determination shall have the power to reduce the duration and/or area and, in its reduced form, such Covenant shall then be enforceable.  No such holding of invalidity or unenforceability in one jurisdiction shall bar or in any way affect Vonage’s right to the relief provided in Section 2 or otherwise in the courts of any other jurisdiction within the geographical scope of the Covenants.

Successors; Binding Agreement.  This Agreement and all obligations of Employee hereunder shall inure to the benefit of, and be enforceable by, Vonage and Vonage’s successors in interest.
Entire Agreement.  This Agreement constitutes the entire understanding between the parties hereto relating to its subject matter hereof, and supersedes all prior negotiations, discussions, preliminary agreements and agreements relating to that subject matter.
Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey (without giving effect to conflicts of law provisions).
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year set forth above.

	
		
	Vonage Holdings Corp.
By:    
	AGREED AND ACCEPTED:
       
   Employee Signature

	Name:    
	 

	Title:    
	       
   Date10-Q Q2 13 Exhibit 10.2 VGTataAddendumEDGARFINAL

VONAGE-TATA CONFIDENTIAL 

THIS ADDENDUM #7 (this “Addendum #7” ) is made and entered into on May 10, 2013, and to become effective as of the 1st day of July, 2013 (“Effective Date”), by and between Tata Communications (America) Inc. (formerly known as Teleglobe America and successor-in-interest to ITXC Corporation), a Delaware corporation whose principal place of business is at 2355 Dulles Corner Boulevard, Suite 700, Herndon, VA 21071 USA (“Carrier”) and Vonage Network LLC, a Delaware limited liability company whose principal place of business is located at 23 Main Street, Holmdel, NJ 07733 USA (“Company”). Carrier and Company are sometimes hereinafter referred to collectively as the “Parties” and individually as a “Party.” Unless otherwise defined, capitalized terms used in this Addendum #7 shall have the same meaning as in the Agreement.

WHEREAS, Company and Carrier are parties to that certain ITXC.NET Services Agreement effective as of May 9, 2003 (inclusive of that certain WWeXCHANGE Origination Services Addendum), as amended to date (the "Agreement"); and

WHEREAS, which the Parties desire to effect the assignment of the Agreement from Vonage Network LLC to Vonage America Inc., and further amend the terms of the Agreement as set forth and described herein.  

NOW, THEREFORE, in consideration of the terms and conditions herein, the Parties agree as follows:

		
	1.
	Assignment:  Vonage Network LLC hereby irrevocably (a) assigns to Vonage America Inc. all of its rights under the Agreement, and (b) delegates to Vonage America Inc. all of its obligations under the Agreement. Vonage America Inc. unconditionally accepts all of Vonage Network LLC’s rights and obligations in, to and under the Agreement, and assumes and agrees to be bound by, fulfill, perform and discharge all of the liabilities, obligations, duties and covenants of Vonage Network LLC under or arising out of the Agreement from and after the Effective Date. For purposes of the Agreement, “Company” will hereinafter be deemed to refer to Vonage America Inc.

		
	2.
	Integration: The Parties agree that upon the Effective Date of this Addendum #7, the terms of the “Route Management Services Addendum” attached hereto as Exhibit A will supersede and replace the 2013 Addendum and all related schedules in its entirety.  The terms of the Exhibit A are hereby expressly incorporated into and made a material part of this Addendum #7 and the Agreement by reference.  In the event of any conflict or inconsistency between this Addendum #7 (including its Exhibit A) and the rest of the Agreement, the terms of this Addendum #7 (including its Exhibit A) shall govern. Except as expressly amended hereby, all of the terms and conditions of the Agreement are hereby ratified and confirmed, and shall remain in full force and effect.

		
	3.
	Counterparts:  This Addendum #7 may be executed in multiple counterparts, each of which shall be deemed to be an original, but all of which counterparts collectively shall constitute one and the same instrument. This Addendum #7 may be executed by facsimile, and the facsimile execution pages will be binding upon the executing Party to the same extent as the original executed pages. The executing Party shall provide originals of the facsimile execution pages for insertion into the Agreement in place of the facsimile pages.

[signature page follows]

1

IN WITNESS WHEREOF, the Parties have duly executed this Addendum #7 by each Party’s duly authorized representatives effective as of the day and year first written above.

By: Tata Communications (America), Inc.        By: Vonage Network LLC (as assignor)

________________________________                     _________________________________
Authorized Signature                    Authorized Signature

Michel Guyot, President, Global Voice Solutions
Name and Title                        Name and Title

May 10, 2013                                    _________________________________
Date                            Date

By: Vonage America Inc.        

_________________________________                      Authorized Signature

_________________________________                     Name and Title

_________________________________                 
Date                        

2

ROUTE MANAGEMENT SERVICES ADDENDUM
(Exhibit A to Addendum #7)
This Route Management Services Addendum is entered into by and between Tata Communications (America) Inc. (“Carrier”) and Vonage America Inc. (“Company”) (each a “Party” and jointly, the “Parties”), is made effective as of July 1, 2013 (“Route Management Effective Date”) and is attached as Exhibit A to Addendum #7 (and together with the body of Addendum #7, to be collectively referred to as the “Addendum”) and made a part of that certain ITXC.NET SERVICES AGREEMENT by and between Tata Communications (America) Inc. and Vonage Network LLC and dated May 9, 2003, as amended (the "Agreement"). All capitalized terms used herein but not specifically defined shall have the meanings assigned to them in the Agreement. 
 In consideration of the covenants and promises herein contained and as set forth in the Agreement, the Parties hereby agree as follows:
		
	1.
	DEFINITIONS:  For purposes of this Addendum, the following definitions shall apply, unless capitalized terms are defined elsewhere in this Addendum:

		
	a)
	Affiliate means any entity that directly or indirectly controls, is controlled by or is under common control with a Party.  For purposes of the foregoing, “control” shall mean the ownership of more than fifty percent (50%) of the (i) voting power to elect the directors of the said entity, or (ii) ownership interest in the said entity. A “Company Affiliate” is an Affiliate of Company. A “Carrier Affiliate” is an Affiliate of Carrier.

		
	b)
	Baseline Exchange Rate means the INR – USD exchange rate published by Reuters as of 4pm (IST) on the Route Management Effective Date, and is subject to change solely as set forth in Section 4 below.

		
	c)
	Billing Period has the meaning set forth in Section 7.1.

		
	d)
	Business Day means a day other than a weekend day or national holiday.

		
	e)
	Carrier Rate Amendment means the form of written notification from Carrier to Company establishing Termination Services rates, and as may be provided from time-to-time to formalize rate changes consistent with the timing and procedures set forth herein.  For clarification purposes, each Carrier Rate Amendment will restate all rates along with the modified rates. 

		
	f)
	Change of Control has the meaning set forth in Section 10.

		
	g)
	Company Group Affiliate means any (i) Company Affiliate (other than a Company Wholly-Owned Affiliate), (ii) Company Strategic Partner, or (iii) Company Non-Wholly-Owned Affiliate.

		
	h)
	Company Wholly-Owned Affiliate means Vonage Holdings Corp., or any entity which is wholly owned, directly or indirectly, by Vonage Holdings Corp. 

		
	i)
	Company Non-Wholly-Owned Affiliate means any entity which is a Company Affiliate partially owned by a Third Party other than a Company Wholly-Owned Affiliate. 

		
	j)
	Company Strategic Partner means a joint venture, private label and other strategic relationships of Company or Company Affiliates with Third Parties, and includes, without limitation, Company’s Affiliated joint venture in Brazil (“Vonage Brazil”) and Globe Telecom Inc./GTI Corporation.

		
	k)
	Excluded Traffic means any traffic (i) generated by Non-Wholly-Owned Affiliates, or under agreements between Wholly-Owned Affiliates and Strategic Partners; provided that Company shall not route any of its Route Management Services traffic to any Non-Wholly-Owned Affiliates or Strategic Partners for purposes of circumventing  its Traffic Volume Commitment, (ii) acquired as part of any merger, acquisition or similar form of transaction involving Company and a Third Party (unless Company specifically requests, in its discretion, that such traffic be included in the Traffic Volume Commitment under this Addendum), (iii) re-routed pursuant to Sections 4.1(d)(ii), 4.1(d)(iii), 4.2(b), 4.2(d) and 6.4(b)(iv), or (iv) re-routed as otherwise permitted under the terms of Schedule A. 

		
	l)
	Force Majeure Event is any cause beyond a Party's reasonable control resulting in such Party’s inability to timely perform its contractual obligations, including, without limitation, acts of war, acts of God, earthquake, hurricanes, flood, fire or other similar casualty, embargo, riot, terrorism, sabotage, strikes, governmental acts or interventions, insurrections, 

Page 3 of 13 –Route Management Services Addendum
PROPRIETARY AND CONFIDENTIAL
Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

epidemics, quarantines, failure of power, cable cuts, condemnation, failure of the Internet or other reason of a like nature not resulting from the actions or inactions of a Party; provided, however that any failure or non-performance of any of Carrier’s interconnected telecommunications providers or suppliers shall not be deemed to constitute a Force Majeure Event except to the extent such Third Party providers or suppliers are themselves impacted by a Force Majeure Event.
		
	m)
	India Rural means the following Destinations: Agra, Ambala, Andhra Pradesh, Bhopal, Coimbatore, Cuttak, Gujarat, Guwahati, Haryana, Jaipur, Karnataka, Kerala, Lucknow, Ludhinana, Magalore, Maharashtra, Mysore, Nagpur, Patna, Pune, Punjab, Raipur, Rajkot, Fixed Other and Tamil Nadu. 

		
	n)
	SLA means the service level agreements described in Schedule A. 

		
	o)
	Payment Period has the meaning set forth in Section 7.1.

		
	p)
	Person means any individual, corporation, firm, limited liability company, general or limited partnership, trust, estate, joint venture, Governmental Entity or any other entity or organization.

		
	q)
	Quality for purposes of Company’s rights pursuant to Section 4.1(d)(ii), 4.1(d)(iii) and Section 4.2(b) ∗, respectively, means that such Third Party carrier’s service level agreement commitments are substantially equivalent to or exceeding the ∗ metrics set forth in Annex B to Schedule A in all material respects. 

		
	r)
	Route Management Service has the meaning set forth in Section 2.

		
	s)
	Route Management Term has the meaning set forth in Section 9.

		
	t)
	ROW has the meaning set forth in Section 4.3.

		
	u)
	ROW Pricing has the meaning set forth in Section 4.3(b).

		
	v)
	ROW Pricing Exceptions has the meaning set forth in Section 4.3(d). 

		
	w)
	Termination Services has the meaning set forth in Section 3.

		
	x)
	Third Party means any Person other than a Party or a Party’s Affiliate.

		
	y)
	Traffic Volume Commitment means, collectively, the India Commitment (as defined in Section 4.1(a)), the Canada Commitment (as defined in Section 4.2(a)) and the ROW Commitment (as defined in Section 4.3(a)), as is subject to modification and Company’s rights to route away traffic as set forth in this Addendum.

		
	z)
	∗

		
	aa)
	Year 1 shall mean twelve (12) months after the Route Management Effective Date.

		
	ab)
	Year 2 shall mean twelve (12) months after Year 1.

		
	ac)
	Year 3 shall mean twelve (12) months after Year 2.

		
	ad)
	Year 4 shall mean twelve (12) months after Year 3.

		
	ae)
	Year 5 shall mean twelve (12) months after Year 4

		
	2.
	ROUTE MANAGEMENT SERVICE:  Company will use Carrier as its preferred supplier to provide Termination Services utilizing the strategic pricing model to the destinations set forth in Section 4 below, in accordance with and subject to the terms and conditions of this Addendum (“Route Management Services”). 

		
	3.
	VOICE TERMINATION SERVICE: Throughout the Route Management Term, Carrier shall provide Company with termination of international telecommunications traffic (IDDD type) which Company has delivered to one of Carrier’s interconnection locations, gateways or network domains for termination to those international destinations listed in the applicable Carrier Rate Amendment under the service tiers described in Section 3(a) and Section 3(b) below (collectively “Termination Services”).  Carrier agrees to 

Page 4 of 13 –Route Management Services Addendum
PROPRIETARY AND CONFIDENTIAL
Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

provide the Termination Services on a 365/24/7 basis in accordance with, and subject to the SLAs set forth and attached to this Addendum as Schedule A hereto. Both Parties shall have dedicated IP interconnects between one another to support the traffic provided under this Agreement.  Carrier is required to interconnect with Company at ∗points of public or private interconnection sites via SIP. Carrier acknowledges and agrees that it is required under this Addendum to support the following CODECs g711, g729, and T.38 fax. Carrier acknowledges that a significant majority of Company’s  calls, regardless of destination, may be delivered to Carrier using CODEC g711, and Carrier shall at all times remain technically prepared to manage Company’s Termination Services traffic routed via such CODECs.  Except to the extent otherwise expressly set forth in Schedule A, Carrier agrees that it will at all times maintain sufficient capacity to support all of Company’s international telecommunications traffic to the extent committed by Company hereunder:
		
	a)
	VTS Prime Service:  VTS Prime Service provides high-quality voice termination services consistently to any destination in the world including MSRN (Mobile Service Roaming Number) ranges and receives the highest priority to Carrier’s supply capacity per destination. All India and Canadian traffic will be serviced under the VTS Prime Service. ROW traffic will be serviced at the service tier (i.e., VTS Prime or VTS Preferred), as selected from time to time by Company for any given destination. Additional VTS Prime Service features include:

		
	▪
	Calling Line Identification (“CLI” or “CLID”) (CLI Delivery)  Carrier assures CLI delivery for the named destinations in the Carrier Rate Amendment to be a minimum of ∗, subject to Company presenting CLI in the appropriate ITU format as provided to Company and updated from time to time.

		
	▪
	Controlled Routing Policy:  In order to avoid deterioration of services, Carrier will endeavor to use Direct Routing for all destinations.  If Direct Routing is not available, Carrier will use the next best available options, Routing Through Incumbent or Routing Through Third Party (each, as defined below). 

		
	▪
	Direct Routing: “Direct Routing” is a form of routing whereby Carrier offers direct termination (no intermediary network) to all the mobile and fixed telecommunication companies/operators covered by the destination during the correspondent period offered.  

		
	▪
	Routing Through Incumbent: “Routing through Incumbent” is a form of routing whereby Carrier offers terminating traffic through the Incumbent operator of the relevant destination to all the operators covered by the destination during the correspondent period offered. 

		
	▪
	Routing Through Third Party: “Routing Through Third Party” is a form of routing whereby Carrier offers to terminate traffic through third party carriers (not the “Incumbents”) to all the mobile and fixed telecommunication companies/operators covered by the destinations during the relevant period  for which the service is offered.

		
	b)
	VTS Preferred Service: VTS Preferred Service provides high-quality termination service which endeavors to use but does not guarantee, Direct Routing, Routing Through Incumbent and CLI delivery, in combination with more extensive Routing Through Third Party to most, but not all, dial code ranges within any destination.  VTS Preferred receives the second highest priority to Carrier’s supply capacity per destination. ROW traffic will be serviced at the service tier (i.e., VTS Prime or VTS Preferred), as selected from time to time by Company for any given destination. 

		
	4.
	PRICING AND TRAFFIC COMMITMENT:  The following pricing will be effective for the Route Management Term:

		
	4.1.
	India Destination: For the India destination, all Route Management Services will be provided utilizing VTS Prime Service, and the following pricing and terms shall be applicable during the Route Management Term, and are not subject to change during the Route Management Term other than as provided under Section 4.1(d) or Section 4.1(e) of this Addendum:

		
	a)
	∗

		
	b)
	∗

		
	c)
	India Rural Pricing:  The India Rural pricing model shall be a base rate of ∗.

Page 5 of 13 –Route Management Services Addendum
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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

		
	d) 
	India Pricing Adjustment (including India Rural):  Carrier may modify the India destination(s) Pricing in accordance with the following, ∗:

		
	i.
	Carrier shall compare the USD-INR exchange rate as reported by Reuters as of 4pm (IST) on the last business day of each Quarter to the “Baseline Exchange Rate”, and in the event the then applicable USD-INR exchange rate has fluctuated by more than ∗ (increase or decrease) from the then current Baseline Exchange Rate: (A) Carrier shall modify the aforementioned India pricing upon providing seven (7) days’ prior written notice (which shall be provided via email to the following address: ratechange@vonage.com), such pricing to become effective at 11:59:59pm (IST) on the seventh (7th) day following the date of the notice; however, any decreases shall be effective upon receipt of notice (email notification to suffice), and (B) that resulting exchange rate shall become the new Baseline Exchange Rate on a going forward basis until the next time that the Baseline Exchange Rate is adjusted according to the foregoing mechanism.  If the then applicable USD-INR exchange rate fluctuates less than ∗ (increase or decrease) from the then current Baseline Exchange Rate, the Baseline Exchange Rate shall remain unchanged; and/or 

		
	ii.
	regulatory changes made by TRAI, Department of Telecom, the Ministry of Finance or any other Indian regulatory agency having jurisdiction over the Termination Services for India destinations (a “Regulatory Change”) which directly result in an increase  to Carrier’s direct IDDD traffic termination costs underlying Company’s rates to India destination(s) (excluding any overhead, administrative, capex and internal costs of doing/growing business) of ∗ from Carrier’s analogous costs underlying the prior applicable discounted rate to Company for the affected India destination(s).  In such case, such rate increase shall be on a penny-to-penny (or fraction thereof) basis without any mark-up and added incrementally to the discounted rate. Carrier shall endeavor to provide prompt notice of such change upon receipt of such notice from the applicable regulatory agency, and will give Company regular updates as to Carrier’s efforts (if any) to mitigate the impacts of such change.  Carrier may not apply any increase under this subsection (ii) without having provided at least seven (7) days prior written notice (email notification to suffice) of such increase, together with sufficient background information, data and detail to enable Company to fully understand the basis for such increase. 

		
	iii.
	If the Carrier’s direct IDDD traffic termination costs underlying Company’s rates to India destination(s) (excluding any overhead, administrative, capex and internal costs of doing/growing business) decreases as a result of a Regulatory Change and the decrease is not reflected in the rate to Company then Company will have the option to re-route its respective India traffic away from Carrier as set forth below. Where Company exercises this option, it will be required to demonstrate to

Page 6 of 13 –Route Management Services Addendum
PROPRIETARY AND CONFIDENTIAL
Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Carrier that it has received a bona fide offer (or offers in the aggregate) from a reputable carrier (or multiple carriers if Company elects to use more than one reputable carrier to satisfy the coverage criteria) capable of providing similar Quality for ∗ of India Commitment traffic, at a weighted average cost per minute per destination (“Competitive Rate”) lower than Carrier’s India then-current discounted rate. Notwithstanding anything to the contrary herein, Carrier shall have a right to match the Competitive Rate within ∗ Business Days after Company’s presentation of the Competitive Rate, along with a certification as to the carrier(s) term commitment (if any) and associated Quality parameters to Company. If during the notice                      
period Carrier confirms in writing that it will match the Competitive Rate, Company’s obligations remain unchanged without a right to route away the India traffic. If Carrier does not confirm its agreement to (or ultimately does not) match the Competitive Rate, Company shall have the immediate right to re-route up to ∗ of its India Commitment traffic until such time as Carrier reduces its rate to the Competitive Rate, after which Company will route the uncommitted portion of the re-routed India Commitment traffic back to Carrier within ∗ business days, and have up to the expiration of each individual commitment with an alternate carrier to which Company is subject, but in no case later than ∗ days following the expiration of the ∗ business day period and Carrier’s failure to confirm its agreement to match the Competitive Rate in order to route such re-routed India Commitment traffic back to Carrier.  Where such re-routed India Commitment traffic is routed back to Carrier following confirmation of its agreement to match the Competitive Rate, all such India Commitment traffic will be subject to Competitive Rate, and all of the other terms and conditions as existed prior to the time of the re-routing. During the period of time in which Company routes any India Commitment traffic away from Carrier as set forth above, the following Carrier obligations shall not apply: (A) the SLA’s in respect of India Commitment traffic, (B) the base rate and any discounted rate hereunder for India Commitment traffic (i.e., the applicable rate for any such traffic that Company does not route away would be as identified in the then current Carrier Rate Amendment), ∗.   For the avoidance of doubt, Company’s remaining obligations under this Addendum with respect to Canada and ROW shall remain unaffected, despite any action (or inaction) to re-route in accordance with the above. and/or
		
	iv.
	∗

In the case where Carrier becomes aware of such an event occurring or reasonably likely to occur, Carrier will use commercially reasonable efforts to mitigate against the impact of such factors as long as the condition continues to exist.  To the extent immitigable, Carrier shall have the right to modify the India destination(s) pricing upon thirty (30) days’ prior written notice (so long as such circumstances continue to exist at the end of the 30 day notice period) together with sufficient background information, data and detail to enable Company to fully understand the basis for such increase, and such increase shall be limited to reflect the actual penny-to-penny (or fraction thereof) increase without any mark-up in Carrier’s Indian licensed telecommunications access provider’s charges imposed on Carrier for the termination of Company’s India destination IDDD traffic.  

If the discounted rate increases for any India destinations (including India Rural destinations), Company will have the option to re-route its respective India traffic away from Carrier as set forth below. Where Company exercises this option, it will be required to demonstrate to Carrier that it has received a bona fide offer (or offers in the aggregate) from a reputable carrier (or multiple carriers if Company elects to use more than one reputable carrier to satisfy the coverage criteria) capable of providing similar Quality for ∗ of India Commitment traffic, at a weighted average cost per minute per destination (“Competitive Rate”) lower than Carrier’s increased India discounted rate. Notwithstanding anything to the contrary herein, Carrier shall have a right to match the Competitive Rate within five (5) Business Days after Company’s presentation of the Competitive Rate, along with a certification as to the carrier(s) term commitment (if any) and associated Quality parameters to Carrier. If during the notice period Carrier confirms in writing that it will match the Competitive Rate, Company’s obligations remain unchanged without a right to route away the India traffic. If Carrier does not confirm its agreement to (or ultimately does not) match the Competitive Rate, Company shall have the immediate right to re-route up to ∗ of its India Commitment traffic until such time as Carrier reduces its rate to the Competitive Rate, after which Company will route the uncommitted portion of the re-routed India Commitment traffic back to Carrier within three (3) business days, and have up to the expiration of each individual commitment with an alternate carrier to which Company is subject, but in no case later than ∗ following the expiration of the ∗ period and Carrier’s failure to confirm its agreement to match the Competitive Rate in order to route such re-routed India Commitment traffic back to Carrier.  Where such re-routed India Commitment traffic is routed back to Carrier following confirmation of its agreement to match the Competitive Rate, all such India Commitment traffic will be subject to Competitive Rate, and all of the other terms and conditions as existed prior to the time of the re-routing. During the period of time in which Company routes any India Commitment traffic away from Carrier as set forth above, the following Carrier obligations shall not apply: (A) the SLA’s in respect of India Commitment traffic, (B) the base rate and any discounted rate hereunder for India Commitment traffic (i.e., the applicable rate for any such traffic that Company does not route away would be as identified in the then current Carrier Rate 

Page 7 of 13 –Route Management Services Addendum
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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Amendment), ∗.   For the avoidance of doubt, Company’s remaining obligations under this Addendum with respect to Canada and ROW shall remain unaffected, despite any action (or inaction) to re-route in accordance with the above.

Page 8 of 13 –Route Management Services Addendum
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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Notwithstanding Company’s route away rights above, should Company not route away any portion of the India Commitment traffic and the reason(s) for any increase under this subsection (d)(iii) abate or cease in a manner as to reduce Carrier’s costs, or any other development(s) occur to reduce Carrier’s cost, in terminating Company’s IDDD traffic, Carrier is obligated to promptly apply such reductions to Company’s pricing until Company’s pricing is restored to the original discounted rates in Section 4.1(b), as adjusted pursuant to Sections 4.1(d)(i) and/or (ii) above. For the avoidance of doubt, Carrier is not obligated to pass on cost decreases that would reduce pricing below the original discounted rates in Section 4.1(b), as adjusted pursuant to Sections 4.1(d)(i) and/or (ii) above.

		
	e)
	∗ 

   
		
	4.2.
	Canada Destination: For the Canada destinations, all Route Management Services will be provided utilizing VTS Prime Service, and the following pricing and terms shall be applicable during the Route Management Term and are not subject to change during the Route Management Term other than as provided under Section 4.2(b) of this Addendum:

		
	a)
	Canada Commitment:  Company shall commit to send ∗ of its Canada destinations traffic (excluding any Excluded Traffic, and IDDD traffic to “Canada High Cost Codes” which are defined as these specific destinations: Canada Directory Assistance, Canada Northwestel and Canada Other) to Carrier (“Canada Commitment”).

		
	b)
	Canada Pricing:  ∗.

		
	c)
	∗

		
	d)
	∗

		
	4.3.
	Rest of World Destinations: For all other destinations (excluding India, Canada, U.S. and Philippines Globe traffic associated with Company’s strategic alliance with Globe/GTI) (“ROW”), the following pricing and terms shall be applicable during the Route Management Term and are not subject to change during the Route Management Term other than as provided under Section 4.3(c) of this Addendum:

		
	a)
	Rest of World Commitment:  Company shall commit to send the lesser of: (i) ∗ of ROW destinations traffic per applicable Quarter; or (ii) ∗ of its ROW destinations traffic per applicable Quarter to Carrier, excluding Excluded Traffic (“ROW Commitment”).

b) Rest of World Pricing:  ∗:

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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

c)     ∗
d)     ∗

		
	5.
	COMPANY REPRESENTATIONS: Company represents and warrants that there is currently (i) no India destination traffic generated or originated by a Company Group Affiliate, and (ii) there is currently no India destination traffic generated or originated by a Company Wholly Owned Affiliates on a wholesale basis. Company further represents and warrants that during the Route Management Term:

		
	a)
	Neither Company, nor any Company Group Affiliate, and nor any Company Wholly-Owned Affiliate shall resell any Termination Service to destinations provided under this Addendum on a wholesale basis without Carrier’s prior written consent. For the avoidance of doubt, Company is permitted to resell Termination Services to destinations provided under this Addendum to Company Wholly-Owned Affiliates  provided that the traffic is retail (i.e., offered by the Company Wholly Owned Affiliate directly to an end user and not a carrier) only; 

		
	b)
	Company shall not directly or indirectly route India Commitment Traffic to or through a Company Group Affiliate or Wholly-Owned Affiliate, unless ultimately destined to Carrier for termination pursuant to this Addendum, without Carrier’s prior written consent, unless otherwise expressly permitted in this Addendum; 

		
	c)
	The India rates may be made available to a Company Wholly-Owned Affiliate (subject to its compliance with Section 5(a) and (b) above), but shall not be made available either directly or indirectly to a Company Group Affiliate without Carrier’s prior written consent; and

		
	d)  
	Carrier hereby provides its consent under (c) above with respect to the joint venture formed by a Company Wholly-Owned Affiliate and Datora Telecommunicaes (and its parent Affiliate) to provide telecommunications services in Brazil on a non-wholesale basis (the “Brazilian JV”). For the avoidance of doubt, the Brazilian JV is prohibited from reselling or transferring rates under this Addendum on a wholesale basis. 

		
	6.
	BENCHMARKING: 

		
	6.1.
	Benchmarking Definitions:  The following definitions shall be applicable for Benchmarking: 

		
	a)
	“Benchmark Country” means an individual or group of available international dialing code(s) that Carrier assigns for Termination Service, which would include either country code only or country code + city code or country code + mobile range or country code + special service code (excluding Canada and India), as established pursuant to Sections 6.2(a) and updated pursuant to Section 6.5.

		
	b)
	“Benchmark Destination” means a subset of a Benchmark Country in which the assigned individual or group of international dialing codes for Termination Service are defined by a particular type/network (i.e., fixed, mobile, special service). 

		
	c)
	“Benchmark Exercise” means the independent third party’s or, the Carrier’s if requested by Company, analysis and summary report on the competitiveness of Route Management Services pricing under this Addendum, as set forth herein.

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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

		
	d)
	“Benchmark Index Rate” means the benchmarking rate for any Benchmark Destination calculated using the rates of the Peer Supplier List, eliminating the highest rate and lowest rate and averaging the remaining rates at the Benchmark Destination (break-out) level.  

		
	e)
	“Benchmark Performance Rate” means the rate established at the Route Management Effective Date, by calculating as follows:

		
	i.
	The total weighted average cost of Benchmark Traffic to the Benchmark Destination, calculated using Carrier’s rates to Company at the Route Management Effective Date, divided by

		
	ii.
	The total weighted average cost of Benchmark Traffic to the Benchmark Destination calculated using the Benchmark Index Rate at the Route Management Effective Date.

		
	f)
	“Benchmark Period” means the previous, full calendar month prior to a Benchmarking Exercise.

		
	g)
	“Benchmark Index Cost” shall be calculated by multiplying the appropriate Benchmark Destination-specific Benchmark Index Rate for that particular Benchmark Period by the appropriate Benchmark Traffic volumes.  

		
	h)
	“Benchmark Traffic” means Company’s actual traffic volumes to the Benchmark Destinations in the month of June 2013 (and as updated in connection with the Annual Benchmark Exercise pursuant to Section 6.5)

		
	6.2.
	Benchmarking Principles and Procedures: Benchmarking will be conducted for the VTS Prime and VTS Preferred service categories using an independent third party to be selected by Company at Company’s cost or, if requested by Company by utilizing Carrier’s internal tool at no cost, based on the following principles and procedures:

		
	a)
	The pricing levied by Carrier will be compared to the rates then-currently loaded into Carrier’s least-cost routing engine and available for use by Carrier to route Termination Service traffic under the VTS Prime and VTS Preferred service tiers, as provided by the ∗ global Tier-1 suppliers identified in Schedule B (the “Peer Supplier List”) for a minimum of the twenty (20) Benchmark Countries as provided by Company to Carrier, plus up to ∗ additional Benchmark Countries as may be identified by Company in its discretion, based on any countries to which Company previously, currently or is forecasted to deliver IDDD traffic.  Company reserves the right to revise the list of Benchmark Countries in its discretion at the time of each Annual Benchmark Exercise. 

		
	6.3.
	Calculation of Benchmark Index Cost and Benchmark Target:

		
	a)
	The rates used to calculate the Benchmark Index Rates shall be the rates then-currently loaded into Carrier’s least-cost routing engine and available for use by Carrier to route Termination Service traffic under the VTS Prime and VTS Preferred service tiers, as provided by the Peer Supplier List, as applicable to the Benchmark Period.

		
	b)
	Benchmark Destinations shall be excluded from the Benchmark Exercise where there are less than five (5) Peer Suppliers that provide rates to Carrier. 

		
	c)
	Volumes of traffic provided to Benchmark Destinations during Force Majeure Events shall be excluded from the above calculations.

		
	d)
	A Benchmark Performance Rate will be established initially upon the Route Management Effective Date in accordance with the Benchmark Exercise described herein.    

		
	6.4.
	Carrier Performance Review:

At Company’s request, but no more than once every ∗ (and not earlier than ∗ following the contract Route Management Effective Date), Carrier’s pricing will be reviewed in connection with the Benchmark Exercise, subject to the following:

Page 11 of 13 –Route Management Services Addendum
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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

		
	a)
	If the result of a Benchmark Exercise is equal to or less than ∗ of the then-current established Benchmark Performance Rate, no further action shall be required by either Party. 

		
	b)
	If result of a Benchmark Exercise is greater than ∗ of the then-current established aggregate benchmark:

		
	i.
	The Parties will identify the Benchmark Destination(s) which caused the result to exceed 105%; 

		
	ii.
	Carrier will have ∗ to “cure” the situation, and bring the Benchmark Performance Rate back to or less than ∗ of the established Benchmark Performance Rate;

		
	iii.
	Another Benchmark Exercise will be carried out (at Carrier’s cost) and completed by the ∗ following the expiration of the ∗ cure period; and  

		
	iv.
	If the results of the new benchmark are still in excess of ∗ of the then-current established Benchmark Performance Rate, Company will have the right to re-route the Benchmark Destination(s) identified in subsection (i) above and the ROW Commitment for the upcoming Quarter will be reduced by the amount of traffic sent to such Benchmark Destination(s) until such time as Carrier can demonstrate via a subsequent Benchmark Exercise (at Carrier’s cost) that its cost base has returned to within ∗ of the Benchmark Performance Rate established at the Route Management Effective Date, at which time, Company will have fourteen (14) days to reroute the traffic back to Carrier.

		
	6.5
	In addition to the Benchmark Exercise above, and occurring on or about each anniversary of the Route Management Effective Date, Carrier shall conduct an additional Benchmark Exercise using Company CDR’s provided by Company as applicable to the Benchmark Period immediately preceding the Benchmark Exercise (the “Annual Benchmark Exercise”).  The aggregate benchmark is thereafter revised and re-established to reflect the Benchmark Index Cost as a result of this Annual Benchmark Exercise, based on actual call values and Company’s revised list of Benchmark Countries.  

		
	7.
	BILLING/PAYMENT TERMS:  Carrier acknowledges that the current deposit of ∗ held by Carrier for Company shall be applied towards the first Invoice under this Addendum.  The Company’s credit limit as of the Route Management Effective Date shall be ∗ USD.  Starting on the Route Management Effective Date and for the Route Management Term, Company shall provide and maintain a prepayment amount (“Prepayment”) to Carrier.  The Prepayment will be invoiced at the beginning of every month by Carrier and payable on reception by Company.  The Prepayment for each month will be equal to the difference between the previous month’s aggregated Invoice amount and the Company’s Credit Limit.  The Parties may mutually agree to use a different method to establish the Prepayment should other estimates be more accurate. 

It is understood that (A) the Prepayment will be applied against Invoices set forth below which are applicable to the traffic month the Prepayment is subject to as soon as they are issued on a first in and first out basis, and (B) Company shall continue to pay Invoices as set forth below.  After the end of the month, a true-up statement will be issued by Carrier and any adjustments will be applicable on the next payment that becomes due.  Carrier shall submit an invoice to Company after the end of the applicable Billing Period (as defined in Section 7.1) which shall include total charges for the applicable Billing Period (“Invoice”). Company shall pay the Invoice amount (less any amounts disputed in good faith pursuant to Section 7.2) to Carrier (1) in US dollars, (2) by wire transfer or such other method as the Parties may mutually agree, and (3) within the applicable Payment Period (as defined in Section 7.1).   In no event shall Carrier be liable for the fraudulent or illegal use of the Services by any customers or end-users of Company, or for any amounts that Company is unable to collect from its customers, end users or others.  
		
	7.1.
	Payment Period. 15 day cycle /15 day net payment due via wire for all non-disputed amounts. The billing intervals shall be fifteen (15) days (“Billing Period”) with fifteen (15) days net payment due from date of invoice receipt (“Payment Period”).  

		
	7.2.
	Invoice Disputes. If a portion of an invoice is paid and subsequently disputed by Company subject to the dispute resolution terms of the Agreement, Carrier shall investigate and the parties shall in good faith resolve such dispute within thirty (30) days of notification from Company. If the Parties agree that Company has overpaid for Route Management Services, Carrier shall credit such overpayment against any other amounts owed by Company to Carrier. Any credits shall be made within thirty (30) days by Carrier against Carrier’s invoices.  In the event that there are no billable services after Company’s notification against which to issue a credit, Carrier shall issue a cash refund. Unresolved disputes will follow the dispute 

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PROPRIETARY AND CONFIDENTIAL
Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

resolution process set out in the Agreement. The Parties further acknowledge and agree that no suspension of services or performance obligations shall be permitted pending dispute resolution of disputed amounts, provided undisputed payment obligations are satisfied.
		
	7.3.
	Back-Billing. Carrier may not invoice services provided to Company more than one hundred twenty (120) calendar days after the end of the month in which Route Management Services were provided or initially raise a claim for payment of a previously issued invoice more than six (6) months after the invoice date (either, a “Late Claim”).  Company is not obligated to pay Late Claims and Carrier waives all rights and remedies related to Late Claims, but excluding any tax obligations for services provided.  Carrier will use good faith efforts to issue separate invoice for any and all arrears billing with proper dates and time periods of incurred usage expense.  

		
	7.4.
	Billing Increments.  Termination Services shall be billed in one (1) second increments with a one (1) second minimum, except for Mexico which shall be billed in sixty (60) second increments with a sixty (60) second minimum.  Any process for the rounding of charges shall be equally applied by the Parties.

Applicable Time Zone:   __ EST      X_ GMT     __ Other (Please specify): _________  (Spain and UK indicate local switch time)
		
	8.
	CREDIT LIMIT AND DEPOSIT:  Carrier may increase the Credit Limit at any time upon notice to Company.  If the financial condition or payment history of the Company (or any surviving entity as a result of a Change of Control event) materially deteriorates after the Effective Date, as evidenced by a material downgrade in its credit rating or debt securities, a bond or loan covenant default, a history of repeated, consecutive, uncured, delinquent payments (not otherwise disputed herein) or other similarly material and demonstrable criteria that makes such condition or payment history unacceptable to the Carrier in its reasonable business judgment, the Carrier may decrease the Credit Limit, or require commercially reasonable alternate arrangements (e.g. LOCs, deposits or prepayments), solely to the extent necessary to mitigate its legitimate credit risk and exposure upon no less than ∗ prior written notice to Company.  If at any time Carrier determines that the sum (the Accrued Liability) of (i) total invoiced amounts which remain unpaid and undisputed, plus (ii) the unbilled but accrued usage of Company, has exceeded the then current Credit Limit, Carrier shall have the right to demand by written notice that Company make an immediate payment to Carrier by telegraphic transfer (or such other method as agreed by the parties) of such amount required to reduce its aggregate Accrued Liability to less than the Credit Limit. Upon written notice to Company, the demanded amount shall become immediately due and payable and Company shall pay such amount within three (3) business days of Company’s receipt of such notice. If Company fails to remit such payment when due, Carrier shall have the right without further notice to temporarily suspend the Route Management Services until such amounts are received by Carrier.  

		
	9.
	ROUTE MANAGEMENT TERM:  Notwithstanding anything contained in the Agreement to the contrary, the Route Management Service and the obligations under this Addendum shall commence on Route Management Effective Date and shall remain in force for an initial five (5) year term (the “Route Management Term”).  Notwithstanding the foregoing, each Party shall have the right to terminate this Addendum by providing six (6) months’ notice prior to the commencement of Year 4 of the Route Management Term.  Upon such notification of termination, the Parties shall immediately enter into good faith negotiations with the goal of reaching an agreement within thirty (30) days of receipt of such termination notice. For the avoidance of doubt, the termination for convenience rights under Section 3.2 of the Agreement shall not apply to this Addendum.

		
	10.
	  ASSIGNMENT AND CHANGE OF CONTROL: The Agreement (including this Addendum) may not be assigned without the express written consent of the other Party, which consent shall not be unreasonably withheld; provided however, that a Change of Control of a Party, or any deemed assignment (whether or not by operation of law) of the Agreement (including this Addendum) resulting from a “Change of Control” of a Party, shall not require the consent of, or compliance with any precondition of the other Party. In addition, either Party may assign this Agreement to an Affiliate of such Party without the need for consent, but with at least ten (10) days prior written notice of such assignment. For purposes of this Agreement, “Change of Control” means (i) a merger involving a Party in which such Party is not the surviving entity; (ii) a merger involving a Party in which the Party is the surviving entity but in which securities possessing greater than fifty percent (50%) of the total combined voting power of a Party’s outstanding voting securities are transferred to other Persons; (iii) a sale or disposition of all or substantially all of a Party’s property, assets or business or merger into or consolidation with any other Person (other than to a Party’s Affiliate); or (iv) a sale, assignment or other transfer of a Party’s securities possessing greater than 50% of the total combined voting power of such Party’s outstanding voting securities at the time of such transfer. Any attempted or purported assignment not permitted hereunder shall be void. 

		
	11.
	LOCAL LOOP CHARGES:  Company shall be responsible for all local loop charges that Carrier is required to pay to any third party service provider that are incurred on behalf of Company and the local loop charges shall survive reduction, suspension and/or termination of services.

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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

		
	12.
	FORECAST ESTIMATES: At least fifteen (15) days prior to the start of each Quarter, Company shall provide to Carrier a written non-binding forecast estimate of traffic volumes for that Quarter, including without limitation, endeavoring to identify any anticipated traffic volume spike periods (the “Forecast Estimate”). If Carrier receives a Forecast Estimate for any destination(s) which are materially greater than prior Forecast Estimates and the capacity for which is reasonably unplanned for such material increase (“Over-Flow Traffic”), then Carrier shall notify Company promptly (within five (5) Business Days) if it cannot adequately provide the necessary capacity to satisfy the Over-Flow Traffic and confirm the maximum capacity it has for such destination(s) traffic. Company has the option to route away the portion of the Over-Flow Traffic exceeding Carrier’s capacity. Company acknowledges that if it does not route away such Over-Flow Traffic, Carrier is relieved from any liability associated with not performing to the minimum SLAs with respect to such destination traffic.   For the avoidance of doubt, Company’s ROW commitment will not be reduced due to Carrier’s inability to provide termination for volumes in excess of ∗ of previous volumes sent by Company to Carrier to any particular destination.

		
	13.
	TERMINATION:  For avoidance of doubt, there is no right of termination for convenience by either party (except for the termination right in Section 9 of this Addendum) notwithstanding any termination for convenience rights under Section 3.2 of the Agreement, nor by Carrier for a material change in financial condition of Company that poses a material financial risk to Carrier notwithstanding the termination rights set forth under Section 3.3(c) of the Agreement; but this Addendum is subject to all other termination rights, including for cause, as set forth in this Addendum and the Agreement; provided that any termination under Section 3.3(a)(ii) of the Agreement must be based on an uncured breach of a material obligation under this Addendum.  Company may terminate this Addendum in whole or in part due to Carrier’s SLA failures as set forth in Schedule A. Any expiration or termination of the Addendum is not considered a termination or expiration of the Agreement. Should Carrier terminate this Addendum in accordance with Suspension/Reduction/Termination provisions of the Agreement (except for Section 3.2 or Section 3.3(c) of the Agreement which are not available under this Addendum), or should Company terminate this Addendum for any reason (except for Section 3.2 or Section 3.3(c) of the Agreement which are not available under this Addendum) other than a material breach solely attributable to Carrier which breach has not been cured within thirty (30) days, then Company shall be fully liable to pay to Carrier any termination charges that Carrier is required to pay to any Third Party telecommunications service provider, if any, for terminating their facilities that were incurred on behalf of Company. 

IF A DEPOSIT IS THEN WITHHELD BY CARRIER:  With respect to this Addendum only, notwithstanding Section 3.3 of the Agreement, neither the Agreement nor this Addendum may be terminated by Carrier due to non-payment unless such charges are undisputed and are, in the aggregate, in excess of the Company’s unapplied unused deposit held by Carrier (if a deposit is then held by Carrier), and remain unpaid for at least five (5) business days after receipt of written notice (which notice must be delivered in accordance with the notice provisions and refer to the right to terminate if payment is not timely met within the five (5) business day period.) Any termination of this Addendum or the Agreement due to Section 3.3(b), (d) or (e) of the Agreement will have the effect of terminating the Parties’ remaining executory obligations under this Addendum, including the remainder of any unmet minimum commitments and pricing commitments, without affecting payment obligations of invoices for services rendered, or any other rights and remedies under the Agreement (independent of the Addendum) regarding the specific basis for the termination.

		
	14.
	OFFICER CERTIFICATION: Each Party, upon written request of the other Party and no more often than twice per year, will provide to the other Party within thirty (30) days thereafter a senior corporate officer’s (designated as a corporate officer by such Party’s by-laws) certificate confirming its compliance with the terms of this Addendum in all material respects.

		
	15.
	AUDIT RIGHTS:  Each Party shall have an annual audit right to the extent reasonably necessary to permit a Party or an auditor appointed by a Party to:

a)For Company: Verify Carrier’s compliance with the terms of this Addendum. 
b)For Carrier: Verify Company’s compliance with the terms of this Addendum.
All such audits shall be conducted:  (i) no more than once per year during the Route Management Term; (ii) with no less than sixty (60) days prior written notice; (iii) at the cost of the auditing Party; (iv) provided any appointed auditor does not have material conflict of interest with the audited Party; (v) subject to the auditor complying with the audited Party’s reasonable confidentiality and security requirements; and (vi) provided that:  (A) it shall be solely for the purposes of verification of compliance with the terms 

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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

of this Addendum; and (B) the audit requests access to books and records related solely to the transactions between the Parties that are the subject of this Addendum.  Any such audit shall be conducted with a minimum of disruption to the other Party’s normal business operations. In the event an audit results in a determination of noncompliance with the terms of this Addendum by a Party, that Party shall pay (or reimburse the other Party for, as applicable) for the reasonable out of pocket costs for that audit.    
		
	16.
	  PRESS RELEASE:  The Parties agree that Carrier may wish to prepare and issue a press release related to this Addendum for issuance on May 14, 2013. In such a case, Carrier will provide a copy of its proposed form of press release on or before May 9, 2013 and may not issue the press release without Company’s prior written consent, not to be unreasonably withheld.

		
	17.
	  NEW MSA. The Parties agree to negotiate in good faith to conclude prior to the Effective Date a new MSA to replace the current MSA, using the Company’s form of MSA attached hereto as Schedule C as a starting point for negotiations.  

		
	18.
	  ∗

		
	19.
	∗

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Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

20. NOTICE: All notices, requests or other communications hereunder shall be in writing, addressed to the Parties at the address indicated herein.  Notices mailed by registered or certified mail shall be deemed to have been received by the addressee on the fifth (5th) business day following the mailing or sending thereof.  Notices sent by facsimile shall be deemed to have been received when the delivery confirmation is received..  A Party may update and amend its notices contact information upon prior written notice.

21.Notice Information:
	
		
	Legal Notices To Carrier:
Tata Communications
Attention : Legal Department
35 Tai Seng Street, 
TCX Building #06-01,  
Singapore 534103
Facsimile: +65 6634 8572 
Email: 
	Legal Notices To Company:
Vonage America Inc.
23 Main Street
Holmdel NJ 07733
Attn:  Chief Legal Officer

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	 Invoices To Company:

Electronic Invoices: Company shall be sent electronic invoices only:   
    No    Yes, please send to the following email address:
         accountspayable@vonage.com 
	Carrier Authorized Rate Notification Sender: Pricing related information, code changes and/or rate notifications shall only be deemed valid if sent to Company from:
    The following email addresses only:
    Email #1: pricing@tatacommunications.com
    Email #2:    ___________________________________
    
   and/or  Tata Communications Pricing Manager

Rate Change Notices To Company Shall Be Sent To:
Rate Change Method For Rates Sent to Company (“Company Rate Change Method”) (Select only one): 
         Email: ___ratechange@vonage.comCourtesy Rate Change Copy To:  _____________________

Company Rate Change Amendment Format:
 Standard  (Only Changes)    Special (Full A-Z listing) 
 Customer Batching        Manual Batching   
Batching Schedule:______________________________________
 Show LATA (US)         Show LATA (Canada)
 Show Service Levels       Show Code By Line
    Show Country City Codes Together

		
	22.
	NO MODIFICATION; CONFLICT:  Except as modified and amended hereby, the Agreement remains unmodified and in full force and effect and each Party hereby reaffirms all representations, warranties and covenants contained therein.  In the event of a conflict between the terms of this Addendum and the Agreement, terms of this Addendum shall control.

		
	23.
	ENTIRE AGREEMENT: This Addendum embodies the entire agreement and understanding of the Parties with respect to the supplementing and amending of the Agreement with regard to the matters described herein. There are no restrictions, promises, representations, warranties, covenants or undertakings with respect thereto, other than those expressly set forth or referred to herein.

Page 17 of 13 –Route Management Services Addendum
PROPRIETARY AND CONFIDENTIAL
Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

IN WITNESS WHEREOF, the Parties have executed this Route Management Services Addendum to the Agreement as of the date last written below.

	
		
	By: Tata Communications (America) Inc.
(“Carrier”)

Authorized Signature
Michel Guyot
Name
President, Global Voice Solutions
Title
May 10, 2013
Date
	By: Vonage America Inc.
(“Company”)

Authorized Signature

Name

Title

Date

Page 18 of 13 –Route Management Services Addendum
PROPRIETARY AND CONFIDENTIAL
Ver. 12.2 (Custom April  2013)

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Schedule A: Service Level Assurance 

In order for Company to fulfill its obligations under the Addendum, Carrier must maintain standards of quality in all aspects related to the provision of Termination Services (“SLAs” or “Service Levels”). To that purpose, Carrier agrees to the standards set forth in this Schedule A (including its Annexes), measured daily and SLA performance shall be calculated on a weekly basis.

1.    INTRODUCTION AND PURPOSE:  

		
	1.1
	This Schedule describes what Service Levels are provided for the Addendum.

		
	1.2
	This Schedule includes Annexes A through E, which set out the specific Service Levels that shall apply. 

		
	1.3
	Service Levels are comprised of: Service Levels relating to Termination Services (‘Termination Service Levels’); and those relating to fault handling (‘Fault Handling Service Levels’). 

2.    MEASUREMENT OF SERVICE LEVELS:

		
	2.1
	Measurement Period

		
	2.1.1
	During the Route Management Term, Carrier shall use industry standard measurement tools to accurately measure, monitor and report the Service Levels, as more specifically set out in Paragraph 3 of this Schedule. 

		
	2.1.2
	Carrier shall endeavor to meet or exceed the Service Levels, as set forth in this Schedule.

3.    SERVICE METRICS FOR CARRIER TERMINATION SERVICES

This section sets out the metrics which shall be used as the basis for setting Service Levels.

3.1 Metrics relating to Carrier Termination Services:  Termination Services in relation to specific Service Levels and destinations will be managed and performance reported against the following metrics listed below (‘Performance Services Metric’).  The definitions of the Performance Service Metric are set out at Annex A to this Schedule and the manner in which Performance Service Levels are set against the Performance Service Metric in relation to specific Service Levels and destinations is set out in the table to be agreed between the Parties in the form set out at Annex B to this Schedule (‘Destination Service Levels Table’).   Subject to the applicable Service Levels and destinations, the Performance Services Metric may include:
		
	•
	∗

The Parties will use reasonable endeavors over the Route Management Term to work towards improving the tools for enhancing Service Level performance.

Page 1

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

3.2 Peak Periods:  The Parties acknowledge that the aforementioned Performance Services Metric may be impacted periodically by in-country market circumstances such as government-recognized national holidays (“National Holidays”).  National Holiday - related impacts shall be considered as Force Majeure Events and such instances shall not be held contributory to the above measurements.

3.2.1    Notwithstanding the foregoing, Carrier and Company shall work together in good faith to develop a capacity plan (“Capacity Plan”) no less than thirty (30) days prior to National Holidays in major destinations to ensure sufficient capacity is available to accommodate for peak traffic during such events. In the event the Parties agree on a Capacity Plan, the applicable Performance Service Metric shall still apply during that National Holiday.  In the event the Parties do not agree on a Capacity Plan, and the traffic during the National Holiday cannot be accommodated by Carrier, Company may route away the affected traffic (in which case, the applicable India Commitment and Canada Commitment, respectively, would not apply).

3.3 Fault Handling Metrics:  Carrier will provide Company with access to a fully trained fault management team.  The specific Fault Handling Service Level definitions are defined below and the specific Service Category to which each metric applies is set out at the Destination Service Levels Table. 

3.4 Response Time:  The time between Company informing Carrier’s designated contact either by means of telephone, e-mail or via Carrier’s customer portal that in Company’s opinion a Fault (as defined in Section 3.6 below) has occurred and the confirmation from Carrier that the Fault is acknowledged.

3.5 Resolution Time:  The time between Company informing Carrier’s designated contact either by means of telephone, e-mail or via Carrier’s customer portal that in Company’ opinion a Fault has occurred and the time at which Company receives by e-mail or via the Carrier customer portal notification that the Fault has been resolved.  If Company identifies that the Fault still persists after the closing of a trouble ticket, the Fault shall be considered not closed and the resolution time shall restart from that point of notification from Company.  Subject to the Fault Reporting Procedures as set forth in Annex D, Carrier will inform Company by e-mail, telephone or via the Carrier customer portal of the status in resolving any Fault upon request by Company. 

3.5.1 Testing Period: From the time Carrier notifies Company that the validated issue is resolved, Company agrees to test and provide ticket fault resolution or feedback within twenty-four (24) hours.  If ticket is closed then Company will re-route traffic as promptly as possible under the circumstances.  If Company perceives the issue still exists, Company will provide proof (e.g. call samples, data to support, etc.) of the existence of the issue.

3.5.2 Carrier will endeavor to proactively notify Company of network issues it becomes aware of.

3.6 Fault Definitions:  When reporting Faults to Carrier, Company will employ standard definitions of the severity of the Fault.  Priority definitions are defined below.  Company reserves the right to contact Carrier and increase the Priority based on the impact to its customers.  The Fault Handling Metrics for the newly-assigned Priority will commence upon such notice. 
a)  Priority 1 Faults:  Priority 1 Faults are a “Material Service Failure” which means any one or more of the following (provided that at all times a Fault in respect of a single telephone number shall not constitute a Material Service Failure):
		
	(i)
	Total outage of Carrier’s Termination Services network ∗ NER;

		
	(ii)
	Complete loss of Voice Termination Service access to any destination listed on the Carrier Rate Amendment; 

		
	(iii)
	Severe destination impairment on the Termination Service  to any destination on the Carrier Rate Amendment for that service, to include:

		
	•
	For traffic routed on Prime Service Level: Performance Service Metrics falling below key performance targets as set out in the Destination Services Levels Table:  ∗ of target for a rolling 7 day period;

Page 2

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

		
	•
	For traffic routed on Preferred Service Level: Performance Service Metrics falling below key performance targets as set out in the Destination Services Levels Table:  ∗ of target for a rolling 7 day period;

		
	•
	Multiple Faults to the same destination on the Termination Service listed in Carrier Rate Amendment twice within 24 hours; or

		
	•
	Company opens ticket which is voice impairment related, is customer impacting (Company to provide a screen shot from internal dashboard to show data on customer impact), Company routes specific destination traffic away, and issue is validated to be a Carrier issue.

b) Priority 2 Faults:  Means any instance when the following measures in respect of any Termination Service destination fails to be met, either:
i) For traffic routed on Prime Service Level: Performance Service Metrics falling below key performance targets as set out in the Destination Services Levels Table:  ∗ of target for a rolling 7 day period; or
ii) For traffic routed on Preferred Service Level: Performance Service Metrics falling below key performance targets as set out in the Destination Services Levels Table:  ∗ of target for a rolling 7 day period.

c) Priority 3 Faults:   Means any instance when the following measures in respect of any Carrier Prime Service Destination fails to be met, either:  
i) For traffic routed on Prime Service Level: Performance Service Metrics falling below key performance targets as set out in the Destination Services Levels Table:  ∗of target for a rolling 7 day period;
ii) For traffic routed on Preferred Service Level: Performance Service Metrics falling below key performance targets as set out in the Destination Services Levels Table:  ∗ of target for a rolling 7 day period; 
iii) Any other Fault not otherwise specified in this Section 3.6(c) to this Schedule A; or
iv) Company opens ticket which is voice impairment related, may or may not be customer impacting, Company does not route away traffic and issue is validated to be a Carrier issue
4.    SERVICE LEVEL EXCLUSIONS:  Notwithstanding anything stated to the contrary herein, Carrier shall be relieved from any failure to achieve a Performance Service Metric to the extent that the cause of an Incident and / or fault is determined to have occurred as a result of one or more of the following conditions:  
		
	(a)
	Any Faults not reported by Company to Carrier as Qualified Trouble Tickets;

		
	(b)
	Force Majeure Events: Neither Carrier nor Company shall be held responsible for any unforeseen Faults as arising from Force Majeure Events as defined in the Addendum. Carrier is responsible for informing Company immediately of all such issues and events and using all commercially reasonable efforts to provide an alternative solution.  In such an event, if the Company is required to route away traffic, Company will be relieved of its Traffic Volume Commitment for the affected period by an amount equal to the daily average amount of traffic to affected destination over the seven (7) days prior to when the Force Majeure Events first occurred multiplied by the number of days Company was required to route away and Company may route such traffic to Third Party telecommunications suppliers at its discretion; provided, however, that Carrier will notify Company of route availability upon elimination of the Force Majeure Event at which time Company will begin a testing period of seven (7) days. Once testing is complete to Company’s reasonable satisfaction, Company will route traffic back to Carrier within the following seven (7) day period.  If the Company continues to route traffic to Carrier during the Force Majeure Event, the amount of traffic Company sent to Carrier for termination will be deducted from the amount of traffic for which it requested relief;

		
	(c)
	Scheduled Work Outages. If Company is properly notified in accordance with Annex E – Company CRQ Process (via email to Company’s designated NOC contact to suffice) of a “planned outage”, the parties agree that any Trouble Tickets that results from such a planned outage shall not be considered as a Faults, to the extent that such planned outages are limited to three (3) occurrences per Quarter and are in each case completed within an agreed-upon maintenance window.  In any event, Company will be relieved of the Traffic Volume Commitment for the entire duration of each planned outage (e.g., whether or not properly notified) by an amount equal to the daily average amount of traffic to affected destination over the seven (7) days prior to when the planned outage first occurred, multiplied by the number of days (and fractions thereof) of the planned outage;

		
	(d)
	For traffic sent by Company to Carrier during Peak Periods to the extent excluded under Section 3.2 of this Schedule;

		
	(e)
	Degradation of performance on the affected destination for the period in question is found to be the result of originating customer behavior which affects the successful delivery of the call; 

		
	(f)
	In the event actual ROW traffic sent by Company to Carrier is in excess of the Company's non-binding forecast by more than ∗ to a particular destination, Carrier shall be relieved of the SLA with respect to the excess traffic to the extent that such failure arises from the excess traffic;

Page 3

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

		
	(g)
	Maintenance actions requested by or attributed to Company;

		
	(h)
	Applications, equipment or facilities provided by Company, its contractors or end-users;

		
	(i)
	Acts or omissions of Company, its contractors or end-users; or

		
	(j)
	Where in respect of a particular destination, the Performance Service Metric would have been met if there had been no invalid or unassigned numbers sent by Company.  

5. SERVICE LEVEL REPORTING 
                
5.1    Fault Handling Reporting:  Carrier will use commercially reasonable efforts to provide an accurate SLA and quality performance reporting to Company by the first and third Monday of every calendar month and failure to timely provide such a report shall not be deemed to be a material breach of this Addendum, unless such failure occurs more than four (4) times within any calendar quarter, which will be subject to cure. These statistics will address, at minimum, daily measurements, and SLA performance shall be calculated on a weekly basis. 

IN WITNESS WHEREOF, the Parties have executed this Schedule A to the Addendum as of the date last written below.
	
		
	

By : Tata Communications (America) Inc.
(“Carrier”)

Authorized Signature

Michel Guyot, President, Global Voice Solutions
Name and Title

May 10, 2013
Date Date
	

By : Vonage America Inc.
(“Company”)

Authorized Signature

Name and Title

Date

Page 4

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

ANNEX A
Definitions of Service Metrics

Network Efficiency Ratio 
Network Effectiveness Ratio is described in ITU E.411.  NER is designed to express the ability of networks to deliver calls to the far-end terminal for Termination Services. NER expresses the relationship between the number of seizures and the sum of the number of seizures resulting in either an answer signal, or a user busy, or a ring no answer, or, in the case of ISDN, a terminal rejection/unavailability. 

Seizure
A call that is accepted for delivery by the receiving network from the originating network for Termination Services.  Once seized, a call is now the responsibility of the receiving network to complete.

Answer to Seizure Ratio (ASR)
ASR: As described in ITU E.411-E437, Answer Seizure Ratio (ASR) gives the relationship between the number of seizures that result in an answer signal and the total number of seizures for Termination Services. This is a direct measure of the effectiveness of the service being offered onward from the point of measurement and is expressed as a percentage as follows:

ASR = (Seizures resulting in answer signal/Total seizures) X 100    

Answer Bid Ratio (ABR)
ABR: As described in ITU E.425, Answer Bids Ratio gives the relationship between the number of bids that result in an answer signal and the total number of bids for Termination Services. This is a direct measure of the effectiveness of the service being offered and is expressed as a percentage.  

ABR - (Bids resulting in answer signal/Total Bids) X 100

Bid
Bid: As described in ITU E.410 Annex 10, a bid is an attempt to obtain a circuit in a circuit group or to a destination. A bid may be successful or unsuccessful in seizing a circuit in that circuit group or to that destination.

Average Length Of Conversation (ALOC)
ALOC: As described in ITU E.437, ALOC is the Average Length Of Conversation for completed calls using the Termination Services. A statistically significant difference in ALOC between two routes may be considered as an indication of some irregularity warranting further investigation.

Number of Repeat Faults

Page 5

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Number of repeat faults is used to describe the number of incidents reported by Company to Carrier as Faults that following Carrier communication of the incident being cleared and Company’s acceptance of the Fault being cleared are subsequently reported again as Faults of the same nature within a period of ∗ hours of the initial or subsequent clear message from Carrier to Company. 

Number of Priority 1 incidents per month 
The number of Priority 1 incidents per month is used to describe the number of Priority 1 Faults that Company reports to Carrier and that Carrier subsequently communicates a clear cause other than “Fault not found”.
Valid Call Attempts
Is used to describe a call request from a Company network to a Carrier network including a valid called party number. Attempts where the called party number is wrong or not in the correct format are excluded form the number of Valid Call Attempts.

Mean Time To Repair
The Mean Time To Repair is used to describe average time between Company opening Qualified Trouble Tickets by the mechanisms specified through the Fault Reporting Process as set forth in Annex C of this Schedule and Carrier communicating the clearance of those Tickets. In any case that a fault is subsequently found not to be cleared the Mean Time To Repair will be from the start of the original fault to the eventual close of the same fault. 

Qualified Trouble Tickets
Qualified Trouble Tickets is used to describe those tickets that are opened as per the Fault Reporting Process as set forth in Annex D to this Schedule and which relate to Faults meeting the definitions of Fault Definitions as set forth in Section 3 of this Schedule.

Page 6

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

ANNEX B
SERVICE LEVELS

The following targets will apply to any destination where for each Service tier Company makes no fewer than 300 Valid Call Attempts on a daily average basis to the applicable Destination. If a Peak Period occurs during the month, then for the destination or metric excluded for that period, the number of Valid Call Attempts on a daily average will be reduced pro rata by the duration of the Peak Period in days as a proportion of the total days in the month. 
Fault Handling Metrics – Prime Service Level
    
	
				
	 
	Priority 1
	Priority 2
	Priority 3

	Response Time
	∗
	∗
	∗

	Periodical Status
	Upon request
	Upon request
	Upon request

	Resolution Time
	∗
	∗
	∗

        

Page 7

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Fault Handling Metrics – Preferred Service Level
    
	
				
	 
	Priority 1
	Priority 2
	Priority 3

	Response Time
	∗
	∗
	∗

	Periodical Status
	Upon request
	Upon request
	Upon request

	Resolution Time
	∗
	∗
	∗

Page 8

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Target Mean Time to Repair

The Target Mean Time To Repair shall be the Resolution Time for each category of Fault Priority for Qualified Trouble Tickets.  The Mean Time To Repair performance will be:

The sum of actual Resolution Time to repair Faults
The total number of Faults

Destination Specific Targets
[SEE DESTINATION SERVICE LEVELS TABLES ATTACHED]

Page 9

Confidential & Proprietary         
Service Level Agreement
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

	
										
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	PRIME
	PREF.

	 
	Desination
	SL
	ASR
	ALOC
	NER
	SL
	ASR
	ALOC
	NER

	 
	*
	*
	*
	*
	*
	*
	*
	*
	*

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	*
	Portions herein identified by * have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

© 2011 Tata Communications Ltd. All Rights Reserved                Global Voice Solutions - Fault Reporting -10
Mar 2013

Annex C:
SLA Failure Remedies

For clarification purposes, the following shall apply to Priority 1 and 2 Faults that are initiated by Company upon its detection of an issue, but excluding any Trouble Tickets that arise due to any Service Level Exclusions (as defined in Section 4 above)): 

	
			
	Chronic Events

	 
	Priority 1 Faults
	Priority 2 Faults

	Chronic Issue
	∗ Priority 1 Faults to the same destination for any rolling ∗ day period.

OR
For India destinations (excluding India Rural) and Canada destinations (excluding the Canada High Cost Codes), only:  Greater than ∗ Faults in a ∗ day period where Carrier did NOT meet the MTTR requirement in Annex B.

	* Priority 2 Faults to the same destination during any rolling ∗ day period. 

	Chronic Condition
	∗ Chronic Issues during any rolling ∗ day period to the same destination or ∗ complete failure across Carrier’s Termination Services network.
OR
 For India destinations (excluding India Rural) and Canada destinations (excluding the  Canada High Cost Codes), only:  Greater than ∗ Faults in a ∗ day period where Carrier did NOT meet the MTTR requirement in Annex B.

	* Chronic Issues during any rolling ∗ day period to the same destinations.

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Should Company experience Chronic Events (defined as per table above), it may have the right to route away Termination Services traffic for the affected destination (at the DNIS level).  Accordingly, in the event of a Chronic Event, Company may elect to be relieved of its Traffic Volume Commitment for the affected destination (at the DNIS level) without penalty during the Event.  In the event Company is unable to fulfill the Traffic Volume Commitments as the result of any one or more Chronic Event(s), Company shall be relieved of any shortfall penalty or other remedy associated with the affected traffic to the affected destination(s) (at the DNIS level), and Company may route such traffic to Third Party telecommunications suppliers at its discretion as a direct result of such Chronic Event(s).  

		
	a.
	Relief from the Traffic Volume Commitment will be equal to the daily average amount of traffic over the ∗ days prior to when the first Chronic Event occurred, multiplied by the number of days of  the Event.  Company shall be relieved from its Traffic Volume Commitment obligations for the affected destination (at the DNIS level) from the time when the Event first occurred.  Should Company elect any relief from its Traffic Volume Commitment to an affected destination (at the DNIS level), Carrier shall not be relieved of its pricing, capacity or SLA obligations. Upon notice from Carrier, Company will begin a testing period of ∗ days.  Once testing is complete to Company’s reasonable satisfaction, Company will route traffic back to Carrier within the following ∗ day period.  

		
	b.
	Solely with respect to India destinations, in the event Chronic Condition(s) occur ∗ or more times in any rolling ∗ month period during the Route Management Services Term, Company shall have a right to terminate the Addendum in whole or in part upon no less thirty (30) days written notice to Carrier, provided such notice is sent within ∗ days of the completion of the second such Chronic Condition(s) giving rise to this termination right. 

		
	c.
	Solely with respect to Canada, in the event of ∗ Chronic Condition(s), Company will be relieved of its Canadian Commitment to Carrier.  In such instance, the affected destination will no longer be subject to SLA’s under this Schedule.

		
	d.
	In addition to and without limiting Company’s rights and remedies under the foregoing, in the event of ∗ Chronic Condition(s) affecting a ROW destination (at the DNIS level), the ROW Commitment will be reduced by the daily average amount of traffic over the ∗ days prior to when the first Chronic Condition occurred for the remaining term of the Addendum and route such traffic to Third Party telecommunications suppliers at its discretion.  In such instances, the affected destination will no longer be subject to SLA’s under this Schedule.

		
	e.
	For the ∗ Commitment only, if a Company shortfall of Traffic Volume Commitment minutes can be traced back to a Carrier caused by Priority 1 Faults where minute relief was not granted, then Company will not be in violation of any shortfall obligations.     

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

ANNEX D

Global Voice Solutions

Fault Reporting

Complete Reference Guide

Our Commitment:
Provide the Highest Level of Customer Service and Satisfaction

Revision March 2013

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

© 2011 Tata Communications Ltd. All Rights Reserved

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

	
		
	
	

How to report a fault

-    By phone : +1-514-868-7875 // UIFN +800-9333-3999
- By e-mail:  customer.service@tatacommunications.com
- Through the customer portal: https://customerzone.tatacommunications.com

Basic Information Required

-    Your name, company name, telephone number (mandatory)
-    Outage or impairment status (preferable)
-    Your fault reference numbers, both from Tata Communications system and from your
internal system if any (optional)
-    Your fault priority (optional)

Service-related Information Requirement – Voice Services

		
	•
	Fault category

		
	•
	Fast busy, RNA, Call drop, CLI, echo, noise etc...

		
	•
	Fault severity for Vonage mapped to TATA fault severity

		
	•
	P1 – P3

		
	•
	Called number

		
	•
	Calling number

		
	•
	Date and time in GMT

		
	•
	Please report faults based on LCR break out vs. destination break out

		
	•
	We often times get 1 email with several LCR break outs for Brazil

		
	•
	CDR (full cdr if possible showing the full detail of the call)

		
	•
	When was fault reported to Vonage (was there a lag in time of fault and time reported)

		
	•
	At time of reported fault was there issue (green, yellow or red) within their impairment tool (packetloss, jitter and latency)

		
	•
	Were any other faults for LCR destination reported during same time?

		
	•
	What investigation steps were taken at Vonage – Include all of below

		
	•
	Did you check customer equipment

		
	•
	Was there IP issue with customer – Can you verify?

		
	•
	RTP issues if any

		
	•
	Traces of the call that had reported fault

		
	•
	Reproduce fault (about half of tickets opened a month are closed due to not being able to reproduce)

Service-related Information Requirement – Access Services (Toll-free/LNS)

-    Type of origination phone used (i.e. mobile, hotel, landline, office, etc.)
-    Has phone number worked previously from this specific phone?
-    Phone number of phone used to place failed call

Resolution Procedures

As Tata Communications is an international telecommunications and data carrier,

© 2011 Tata Communications Ltd. All Rights Reserved                Global Voice Solutions - Fault Reporting -2
Mar 2013

	
		
	
	

the service outage or service deficiency may be related to a particular link with a foreign carrier or localised within the territory of a foreign administration. In that case, the GNMC will coordinate the testing and repair work with the foreign carrier or administration. Throughout this process the TSC-W will follow the progress of this work, keeping
the customer advised of the fault resolution process and ensuring rapid fault resolution.

Either upon receipt of a called-in fault report or from automatic fault detection, network operations personnel investigate to determine the source of the fault and attempt to resolve it. If this is not feasible, maintenance personnel are dispatched on a worldwide basis
to the source of the problem.

© 2011 Tata Communications Ltd. All Rights Reserved                Global Voice Solutions - Fault Reporting -3
Mar 2013

	
		
	
	

Incident Criteria

Event Classification    Incident Criteria Voice

	
		
	Severity 3
	Single Number Problem
Single Area Problem
No Ring Back Tone (RBT)

	Severity 2   Voice quality issues e.g., Echo, One Way
(Median priority)   Speech and Cross Talk.
Low ASR to a destination
Mobile Station Roaming Number (MSRN) coverage

	Severity 1   0% destination Answer Seizure Ratio (ASR) (Highest priority)   Call Line Identification (CLI) Failure
Fax Issues
Dual-Tone Multi-Frequency (DTMF) Issues
False Answer Supervision (FAS)

	Crisis event   Loss of Switching, Signalling and Routing  Platform

2. Repair Time and Escalation

Tata Communications maintains aggressive goals for Mean Time To Repair (MTTR).
If the MTTR threshold is in jeopardy and/or if the customer feels it is necessary, the customer may begin escalating the trouble within Tata Communications.

The following escalation guidelines apply to customer service interruptions:
		
	-
	Escalation should be made at the given intervals until the trouble is isolated and a repair plan is implemented.

		
	-
	Escalation can vary after the isolation of the fault depending on repair activity underway and is not necessarily limited to set intervals.

		
	-
	Escalation will be based on fault duration, not length of time at the fix agency (even if the fix agency just received the ticket). The escalation clock starts when the ticket is opened.

© 2011 Tata Communications Ltd. All Rights Reserved                Global Voice Solutions - Fault Reporting -4
Mar 2013

	
		
	
	

Escalation List for Global Customer Service - Contact matrix to be used during trouble ticket life cycle. Please ensure you have reached the first level of escalation before moving to the next level.

Contact    Phone    E-mail

1st Level: Shift Lead TSC-W
 

+1-514-868-7875
UFIN +800-9333-3999

 
 

GCSC.Escalations@tatacommunications.com

2nd Level:
Parag Rodrigues
Manager-Global
Voice Solutions, TSC-W
3rd Level:
Piyush Handique
Head, TSC-W
 
+91-20-6614-3217 (O)
+91-84-4627-5275 (M)

 

+91-20-6614-3207 (O)
+91-80-9708-0706 (M)
parag.rodrigues@tatacommunications.com

Piyush.handique@tatacommunications.com

4th Level: Vijay Agarwal, VP. Technical Support Center Operations
 
+91-22-6659-1671 (O)

 
+91-92-2329-9170 (M)
 
vijay.agarwal@tatacommunications.com

3. Fault Ticket Closure

Once the reported issued has been cleared by our technical staff, you will be contacted to ensure you are satisfied with our findings. We will provide you with at least twenty-four (24) hours to validate these findings and let us know if further support is required.

4. Customer Portal

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If you are a first-time user, you will need a user ID and password, please contact your customer service representative either by phone (+1-514-868-7875 // UIFN +800-9333-3999) or by e-mail (customer.service@tatacommunications.com) to gain access to the portal. Please note that passwords are case sensitive.
Customer portal will allow you to:
		
	-
	Open new tickets using “Create New Ticket” in menu and fill in information mentioned in Section 1 of this document: Reporting a Fault – Ticket number to be provided upon creation of a ticket.

-    Get status on an open ticket – Enter number in box “Trouble number here” to view
existing ticket. Entries are shown in reverse chronological order.
-    View closed tickets (not older than 90 days)

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5. Organisations

Technical Support Centre Wholesale (TSC-W): The TSC-W serves as the primary customer entry point for all service-related faults. Acting as the customer advocate within Tata Communications the TSC-W owns overall customer satisfaction, notification communications and management of internal escalations 24 hours a day, 7 days a week. The TSC-W is staffed by customer service professionals specialised in the Telecommunications industry. Working with Tata Communications’ Network Management Centres, the TSC-W will track all faults until their resolution.

Global Network Management Centre (Voice): Within Tata Communications’ state-of- the-art GNMC there exists a team dedicated exclusively to the network management, network surveillance, and fault resolution for Tata Communications’ Voice traffic. This team consists of graduate-level telecommunication technologists and engineers working on a
24x7 schedule. Tata Communications’ engineers, technicians and support staff continuously
monitor network operations and capacity to ensure stated service levels are achieved.

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Technical Service Centre - Wholesale (TSC-W) Contact and Escalation Numbers

UIFN Number* +800-9333-3999

Direct: +1-514-868-7875    Fax: +1-514-868-8996
Email: customer.service@tatacommunications.com

Country Specific Toll-free Numbers

	
				
	Country
	Number
	Country
	Number

	Argentina
	0800 222 0069
	Japan
	00 531 162 214

	Bahrain
	800 00932
	Mexico
	001 800 514 0346

	Brazil
	0800 891 6953
	Norway
	800 13447

	Canada
	1 800 567 1950
	Philippines
	1 800 1110 1451

	Chile
	800 201 790
	Poland
	00800 1114 497

	China
	10 800 1400 064
	Portugal
	800 819 512

	Colombia
	01 800 919 0178
	Russia
	810800 2161 1012

	Denmark
	808 80408
	Spain
	900 981 576

	France
	0800 910 517
	Sweden
	0207 98512

	Germany
	0800 1812 364
	Switzerland
	0800 838 811

	Greece
	00800 161 2203 0179
	Thailand
	001 800 1562 200 592

	Hong Kong (1)
	800 930 578
	Turkey
	00800 142 030 326

	Hong Kong (2)
	800 965 063
	United Kingdom
	0800 895 256

	Indonesia (1)
	001 803 0172 566
	U.S.A.
	1888 933 3399

	Indonesia (2)
	007 803 0172 566
	Venezuela
	0800 1003 081

	Italy
	800 872 018
	 
	 

Note: UIFN Toll-free access is currently available in Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Japan, Malaysia, New Zealand, Norway, Singapore, South Korea, Sweden, Switzerland, Taiwan, The Netherlands, and the U.K. Refer to your account representative for availability of this service in your area.

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© 2011 Tata Communications Ltd. All Rights Reserved                Global Voice Solutions - Fault Reporting -8
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Annex E:
Vonage CRQ Process

This document provides change notification guideline for external vendors and carriers when work is scheduled to be done that has the potential to disrupt provided services. Vonage requests that any work that has potential to disrupt provided service is reported to use using the below guidelines. 
Revision Date: 10/25/2012 
Responsible Group: Vonage Change Management 
Maintenance Types 
Normal Request 
• Description - Planned maintenance that has the ability to or will impact service provided to Vonage. 
• Minimum notification - 2 weeks advance notice 
• Notification is to be sent to ChangeManagement@vonage.com via email 
• Preferred Maintenance Window: 12AM – 6AM ET 
• Description of the work to be done. 
• Circuits or Service that is being affected by the maintenance. 

Emergency Request 
• Description - Change needs to be done immediately and cannot wait. 
• Notification: As much as possible 
• Sent to: ChangeManagement@vonage.com and NOC-Team@vonage.com 
• Description of the work to be done. 
• Circuits or Service that is being affected by the maintenance. 

Notification Requirements 
1. The Notification is to be sent to Vonage via email to ChangeManagement@vonage.com. 
2. Subject Guidelines 

When filing an RFM please use the following subject conventions. 
Subject: CATEGORY | SUB CATEGORY | Title of maintenance 
Example Subject: MAINTENANCE | CIRCUIT GROOMING | Grooming circuits in New York 
3. The following information is to be included in the notification email advisement. 
a. VENDOR/CARRIER internal reference number 
b. Maintenance Type – (See Above) 
c. Start and end date & time of the maintenance 
d. Reason for maintenance 
e. Location of maintenance 
f. Service(s) Impacted 
g. Circuit / Application impacted, the duration of impact and description of impact. 
h. Contact information for VENDOR who can provide more information about the maintenance. 
i. Additional Notes 

In the event that escalation is needed on Vonage’s end for any maintenance related work please follow the below escalation path.

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	Change Management Escalation Contacts Level 
	Contact
	Title
	Contact Info

	1
	NOC-Team
	Vonage NOC
	e: NOC-Team@vonage.com 
p: (877) 662-2001 

	2
	Michael Lill 
John Howard 
	Change Manager 
Change Manager 
	e: Michael.Lill@vonage.com 
p: (848) 219-7315 
e: John.Howard@vonage.com 
p: (732) 786-1476 

	3
	Michael Mayernik
	Director of Operations
	e: Michael.Mayernik@vonage.com 
p: (732) 337-3803 

© 2011 Tata Communications Ltd. All Rights Reserved                Global Voice Solutions - Fault Reporting -10
Mar 2013

Vonage - Confidential and Proprietary
DISCUSSION PURPOSES ONLY

 
SCHEDULE C
Proposed Form of MSA
MASTER SERVICES AGREEMENT
This  Master Services Agreement for the provision of voice termination services  is made and entered into as of this ___ day of May, 2013 (the “Effective Date”) by and between Vonage America Inc., a company formed under the laws of the State of Delaware with its principal office at 23 Main Street, Holmdel, NJ 07733 (“Vonage”) and Tata Communications (America) Inc. (“Carrier”), a company incorporated under the laws of the State of Delaware with its principal office located at 2355 Dulles Corner Boulevard, Suite 700, Herndon, VA 20171.  Vonage and Carrier are referred to collectively as “Parties,” and individually as a “Party.”
RECITALS
WHEREAS, Carrier is in the business of providing certain voice call termination services described in more detail in Schedule 1 attached hereto (the “Services”), and intends to provide such Services in accordance with the rates, terms and conditions set forth in Route Management Services Addenda entered into by the Parties,  , including the attached service schedule(s) and exhibit(s) thereto (collectively, the “Agreement”);
WHEREAS, Vonage desires to purchase from Carrier and Carrier desires to sell to Vonage, such Services in accordance with and subject to the rates, terms and conditions set forth in this Agreement;
NOW THEREFORE, in consideration of the terms and conditions herein and other good and valuable consideration, Vonage and Carrier, intending to be legally bound, agree as follows:
AGREEMENT
1.    SCOPE.
1.1    Commencing on the Effective Date, and at all times during the Term of the Agreement, Carrier will provide the Services to Vonage in accordance with the rates, terms and conditions of this Agreement.
1.2    Other services may be agreed to between Vonage and Carrier from time to time and documented herein or in an additional service schedule(s) which will be incorporated into and form part of this Agreement.  Upon incorporation of any additional service schedule(s) into this Agreement, any such other services to be provided thereunder shall constitute “Services” to be provided by Carrier.
2.    TERM.
2.1    This Agreement shall come into effect on the Effective Date and shall continue in full force and effect for a period of five (5) years  (the “Term”), unless terminated earlier or extended as set forth in this Agreement.  

 \\NORTHVA - 034887/000005 - 570563 v1 

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

2.2    Either Party may terminate this Agreement if the other Party is in breach of a material obligation under this Agreement and fails to remedy the same within thirty (30) days after receipt of written notice from the non-breaching Party notifying the other Party of the breach and requiring that the breach be remedied.
2.3    Either Party may terminate this Agreement upon giving the other Party written notice in the event: (i) such Party makes an assignment or takes any other action for the benefit of creditors; (ii) such other Party becomes bankrupt or insolvent; (iii) such other Party takes the benefit of any law, rule or regulation relating to bankruptcy or insolvency; (iv) such other Party appoints a receiver or trustee in bankruptcy or other officer with similar powers; or (v) upon any proceeding in bankruptcy, receivership or liquidation being instituted against the other Party and continuing for thirty (30) days without being dismissed.
2.4    Subject to the terms of the then current Route Management Services Addendum, , either Party may terminate this Agreement at any time upon or after the fifth (5th) anniversary of the Effective Date with not less than sixty (60) days’ prior written notice, with respect to any or all markets for International Call Termination Services. 
2.5    The expiration or earlier termination of this Agreement shall not affect any rights or obligations of the Parties that have accrued prior to the date of such expiration or termination.
3.    OBLIGATIONS OF THE PARTIES.
3.1    Obligations of the Carrier:
(a)    Carrier has sole responsibility for installation, testing, operation of and costs associated with facilities, services, local access and equipment on its side of the Meet-Me-Location (as defined in Schedules 1 and 2), and any other facilities, services, local access and equipment specifically provided by Carrier in connection with the provision of Services hereunder.
(b)    Carrier shall, on a twenty-four (24) hours per day, seven (7) days per week basis, maintain overall network quality, and provide and operate the Services to meet or exceed the service level metrics related to the Services as may be set forth in an exhibit hereto, and if a service level metric does not apply with respect to a particular Carrier obligation or if none are included, such obligation will performed in a manner consistent with the standards satisfied by well-managed operations performing services that are reasonably comparable.
(c)    Carrier shall implement and maintain all commercially reasonable safeguards to prevent the disclosure of end-user information and unauthorized access to the Services.  Further Carrier will ensure that security controls and procedures no less stringent than as required under Section 5.3 are in place to prevent such access, including without limitation the initiation of fraudulent calls by, and the unauthorized release of customer information to, third parties.  In the event that Carrier detects any such activity, Carrier shall promptly notify Vonage and take immediate corrective action.
(d)    Carrier will rate calls received from Vonage for termination based on the NPA-NXX of the Calling Party Number (CPN) and the NPA-NXX of the Called Party Number.  The Carrier will rate calls where the NPA-NXX of the CPN is not available or otherwise not valid based on the Billing Telephone Number (BTN).  
3.2    Obligations of Vonage:

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

(a)    Vonage has sole responsibility for installation, testing, operation of and costs associated with facilities, services, local access and equipment on its side of the Meet-Me-Location, and any other facilities, services, local access and equipment specifically provided by Vonage in connection with the provision of its retail VoIP services.
(b)    Vonage shall make payments to Carrier in accordance with the payment obligations set forth in Section 4.
(c)    Vonage shall work cooperatively and in good faith with Carrier to remedy any unauthorized disclosure of end user information or access to the Services described in Section 3.1(c).
(d)    Vonage will not remove or alter any NPA-NXX information associated with calls delivered to the Carrier for termination.
4.    BILLING AND PAYMENT.
4.1    Invoicing.  Carrier will invoice Vonage on a monthly basis in arrears for all traffic that Vonage elects to send to Carrier for termination using the Services pursuant to this Agreement.  Carrier will send such monthly invoice to Vonage by e-mail to Accountspayable@vonage.com or  mail the original monthly invoice (Attn: Accounts Payable) on or before the last working day of the month following the month to which it relates.  The monthly invoice shall include, at a minimum, the following information for Services purchased under this Agreement: (a) the number of completed and attempted calls by destination country, or by destination city where city level rating applies; (b) the applicable per minute rates per destination; (c) the “Billable Time” (as defined in Schedule 1) by destination country, or by destination city where city level rating applies; (d) a list of all destination NPAs; and (e) a separated itemization of all total Taxes and Taxes per destination.  All monthly invoices shall be represented in U.S. dollars. Carrier shall make available to Vonage as part of the monthly invoice CDR data for all call transactions included in the invoice.   Such CDR data shall be provide via CD or made available via an FTP server for a period of twenty four (24) months following said invoice.  Vonage may dispute any invoice, and shall notify vendor in writing with a detailed explanation for the dispute.  Carrier will investigate the dispute and attempt to resolve the dispute within (15) business days.  In the event of any dispute, the Party with answer supervision hardware evidencing the shorter billable period prevails.
4.2    Payment.  Unless otherwise set forth in an applicable service schedule, subject to Vonage’s right to withhold amounts disputed in good faith, all other undisputed Net Settlement Amounts (as defined in Section 4.3) shall be payable by check or wire in U.S. dollars within ____________days following the date of Vonage’s receipt of the invoice (the “Billing Period”).  Carrier may not invoice Services provided to Vonage more than one hundred twenty (120) days from the end of the month in which Services to which such amounts relate are rendered, or initially raise a claim for payment of a previously issued invoice more than six (6) months after the invoice date (either, a “Late Claim”).  Any permitted back-billing must be submitted on a separate invoice. Vonage is not obligated to pay Late Claims and Carrier waives all rights and remedies to Late Claims, but excluded any tax obligations for Services provided. 

4.3    Reconciliation.  Where traffic and/or amounts are intended to be exchanged between both Parties, a net settlement of invoices shall occur, such that the undisputed balance due from one Party shall be offset by the balance due from the other Party (the “Net Settlement Procedure”).  The Net Settlement 

- 13 -
 
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

Procedure shall result in a net amount due from the debtor Party to the creditor Party (the “Net Settlement Amount”).    
4.4    Taxes.  Aside from the taxes, fees, duties, costs, charges, surcharges, assessments, or other taxes or similar liabilities (collectively “Taxes”) set forth in Exhibit 1-B, no other Taxes shall be invoiced to or payable by Vonage.  Such Taxes may be invoiced by Carrier and paid by Vonage in accordance with the invoicing and payment provisions set forth herein.  The foregoing notwithstanding, to the extent Vonage presents a valid exemption certificate, Customer shall be exempt from such Taxes to which the certificate relates. Carrier shall, when reasonably requested by Vonage and at Vonage’s sole expense, assist and cooperate with Vonage in challenging the validity of any such taxes that Vonage is required to pay under the terms of this Agreement.  Vonage and Carrier shall reasonably cooperate with each other to minimize Vonage’s liability to the extent legally permissible.  
5.    REPRESENTATIONS AND WARRANTIES.
5.1    Compliance with Specifications and Applicable Laws. Carrier represents and covenants that the Services offered or provided to Vonage are, and after the Effective Date shall be, in strict conformance with (i) the specifications set forth in Schedule 1, including all exhibits and addenda thereto, including, without limitation, any applicable service level agreements and related remedies; and (ii) applicable laws and regulations.  
5.2    Work Standards. Carrier represents and covenants that it shall deliver the Services with promptness and diligence, and in a workmanlike manner, each in accordance with the practices and high professional standards used in well-managed operations performing services similar to the Services. Carrier represents and covenants that it shall use adequate numbers of qualified individuals with suitable training, education, experience, and skill to provide the Services.
5.3    Data Security. Carrier represents and warrants that it has data security policies and procedures, and adheres to such policies and procedures, as to ensure it will comply at all times during the Term with Vonage’s Information Security Policy, as may be updated and modified from time-to-time, the current version of which is attached hereto as Exhibit 1-D. 
5.4    Full Power. Each Party represents, warrants and covenants that: (i) it has the requisite power and authority to enter into the Agreement and to carry out the obligations and transactions contemplated by the Agreement; (ii) the execution, delivery and performance of the Agreement and the consummation of the transactions contemplated by the Agreement have been duly authorized by the requisite action on the part of such Party; and (iii) this Agreement constitutes a legal, valid and binding obligation enforceable against such Party in accordance with its terms, subject to bankruptcy, insolvency, creditors’ rights and general equitable principles and its execution, delivery and performance of this Agreement shall not conflict with or result in the breach of, or constitute a default under any contract, loan agreement, indenture, lease, indefeasible right of use agreement or other agreement binding on or affecting such Party or any of its properties.
5.5    Ethnical Business Practices.  Each Party represents and warrants that it shall not make or offer to make any payment or gift directly or indirectly to any employee, officer or representative of any government, political party or candidate for political office under circumstances in which such payment could constitute a bribe, kickback or illegal payment under all applicable anti-bribery laws (including but not limited to the U.S Foreign Corrupt Practices Act and the Corruption of Public Officials Act of Canada).  Without limiting 

- 14 -
 
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

the generality of the foregoing, each Party further represents and warrants that under no circumstances, shall it make, cause or authorise any third party to make or cause any bribes, kickbacks, or illegal payments for the purpose of influencing a person’s acts or decisions or in order to obtain or retain business in connection with the Services provided/received hereunder.  Each Party agrees to comply with all applicable anti-bribery laws and further agrees that any failure by a Party to comply with the provisions of this clause shall constitute a material and incurable breach of this Agreement.
6.    LIMITATIONS OF LIABILITY.
6.1    The Parties acknowledge that they have no control over how a foreign administration or third party carrier establishes its own rules and conditions pertaining to international telecommunications services.  Other than with respect to any service level agreements set forth in an applicable service schedule(s) (including its exhibits and addenda), the Parties agree that they shall not be liable to each other for any loss or damage sustained by the other Party, its interconnecting carriers, its customers or end users due to any failure in or breakdown of the communication facilities associated with providing the Services.
6.2    NEITHER PARTY SHALL HAVE ANY LIABILITY WHATSOEVER FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE, OR SPECIAL DAMAGES SUFFERED BY THE OTHER OR BY ANY ASSIGNEE OR OTHER TRANSFEREE OF THE OTHER, EVEN IF INFORMED IN ADVANCE OF THE POSSIBILITY OF SUCH DAMAGES. 
6.3    Each Party’s total liability to the other under this Agreement for any and all claims, demands, causes of action, liabilities, expenses, damages, losses, or liabilities (including reasonable attorneys’ fees) (collectively, “Claims”) by a Party shall not exceed in the aggregate an amount equal to twelve (12) times the aggregate amount invoiced by Carrier for Services rendered prior to the month in which the event giving rise to liability occurred.  For avoidance of doubt, a “Claim” involves any Claim or series of Claims arising from the same occurrence, omission or common nucleus of facts.
6.4    Notwithstanding the foregoing, the limitations set forth in Sections 6.2  and 6.3 shall not apply with respect to: 
a.    amounts correctly invoiced for Services properly rendered under this Agreement; and
b.    damages arising out of or related to Carrier’s breach of its most-favored nation and/or other pricing protections set forth under an applicable service schedule(s) (including its exhibits and addenda).
Each Party shall have a duty to mitigate damages for which the other Party is responsible.
7.    INDEMNIFICATION.
7.1    Contract Breach and Product Liability.  Each Party agrees to indemnify, defend and hold the other Party (including its affiliates, officers, directors, employees, contractors and representatives) harmless for third party Claims: (i) arising from the indemnifying Party’s material breach of any obligation, representation or warranty under this Agreement; (ii) any material violation by the indemnifying Party or its affiliates of any applicable laws in connection with the performance of its obligations under this Agreement; or (iii) relating to any physical damage to property, or personal injury or death, caused by the indemnifying Party or any of its affiliates, agents or subcontractors. In addition, 

- 15 -
 
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

7.2    Intellectual Property. 
a.    Carrier also agrees to indemnify, defend, protect and hold harmless Vonage (including its affiliates, officers, directors, employees, contractors and representatives) from and against, any and all third party claims, injuries, losses, damages, liabilities or expenses of any kind, including reasonable attorneys’ fees and costs of litigation, which third party claims arise out of or result from, directly or indirectly, in whole or in part from any third-party claim of infringement of any U.S. patent, copyright, trademark, service mark, trade secret or other intellectual property rights of a third party arising from or related to the Services.     
b.    If any Service becomes, or is likely to become, the subject of a Claim of infringement of intellectual property, Carrier shall, in addition to indemnifying Vonage as provided in Section 7.2(a), promptly at Carrier’s expense use best efforts to: (i) secure the right to continue using the Service; or (ii) replace or modify the Service to make it non-infringing, provided that any such replacement or modification shall not degrade the performance or quality of the affected component of the Services.  In the event neither of such actions can be accomplished by Carrier, and only in such event, Vonage may at its option terminate this Agreement without liability upon notice to Carrier and shall be equitably compensated for Services paid for and not received.
7.3    Indemnification Procedure.  The indemnified Party under Section 7.1 above: (i) must notify the other Party in writing promptly upon learning of any claim or suit for which indemnification may be sought, provided that failure to do so shall have no effect except to the extent that the other Party is prejudiced thereby; (ii) must provide all information and assistance as reasonably requested by, and at the expense of, the other Party in connection with the conduct of the defense and settlement thereof; and (iii) may participate in such defense or settlement with its own counsel at its sole expense, but without control or authority to defend or settle.  The indemnifying party shall not take any action, which unreasonably exposes the indemnified party to a risk of damages, which would not be covered by such indemnity, and may not settle any matter without the prior written consent of the indemnified party, which shall not be unreasonably withheld.
8.    CONFIDENTIALITY.  
8.1    Obligations. Each Party acknowledges that Confidential Information may be disclosed to the other Party during the course of this Agreement.  Each Party agrees that during the Term and for a period of three (3) years thereafter, it shall use at least the same degree of care as it employs to avoid unauthorized disclosure of its own information, but in no event less than a commercially reasonable degree of care, to prevent the duplication or disclosure of Confidential Information of the other Party, other than by or to (i) its employees or agents who must have access to such Confidential Information to perform such Party’s obligations hereunder, who shall each agree to comply with confidentiality requirements no less restrictive than those contained in this Article; and (ii) independent third-party auditors that agree in writing to comply with confidentiality requirements no less restrictive than those contained in this Article.  Notwithstanding the foregoing, either Party may issue a disclosure containing Confidential Information without the consent of the other Party, to the extent such disclosure is required by law, rule, regulation or government or court order.  In such event, the disclosing Party shall provide at least seven (7) days prior notice of such proposed disclosure to the other Party. Further, in the event such disclosure is required of either Party under the laws, rules or regulations of any applicable governing body, such Party shall: (a) redact mutually agreed-upon portions of this Agreement to the fullest extent permitted under applicable laws, rules and regulations; and (b) submit a request to such governing body that such portions and other provisions of this Agreement receive confidential treatment or otherwise be 

- 16 -
 
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

held in the strictest confidence to the fullest extent permitted under the laws, rules or regulations of the applicable governing body.
8.2    Definition.  For purposes hereof, "Confidential Information" means any information, in any form, furnished or made available directly or indirectly by one Party (the "Disclosing Party") to the other (the "Receiving Party") relating to or disclosed in the course of the negotiation or performance of this Agreement, that is, or should be reasonably understood to be, confidential or proprietary to the Disclosing Party (including the terms of this Agreement; information transmitted by means of the services; Vonage usage statistics; all usage data and reports collected by Carrier and all reports provided to Vonage by Carrier; calling patterns; invoices and any supporting information provided by Carrier or Vonage with respect to such invoices; information audited pursuant to the Agreement; Vonage's Customer Information (defined below); automatic numbering identification (“ANI”) data and information; the relations of the Disclosing Party with its customers; employees and  service providers; technical processes and formulas; source codes, product designs, sales, cost and other unpublished financial information; and product and business plans projections and marketing data); provided, however, that "Confidential Information" shall not include information: (i) already lawfully known to or independently developed by the receiving Party without violation of any confidentiality obligation; (ii) lawfully disclosed in published materials without violation of any confidentiality obligation; (iii) generally known to the public; or (iv) lawfully obtained from any third party without violation of any confidentiality obligation. Vonage may disclose this Agreement under a comparable non-disclosure agreement in response to a third party due diligence request supporting a financing or non-ordinary course of business corporate transaction so long as such disclosure is not to a direct competitor of Carrier, and such requestor is subject to a comparable non-disclosure agreement.
8.2    Collection, Use and Disclosure of Vonage Customer Information.  Carrier shall ensure that its collection, use and disclosure of information regarding Vonage’s customers or subscribers names, email addresses, addresses, telephone numbers and other identifying or personal information provided by Vonage or otherwise obtained in connection with performance of their obligations hereunder (collectively, “Customer Information”) complies with: (i) all applicable laws and regulations; and (ii) Vonage’s standard privacy policies, provided that Carrier shall not collect, process, store, use or disclose any Customer Information except for the sole and exclusive purpose of fulfilling its obligations hereunder.  All Customer Information constitutes Confidential Information for purposes of this Agreement. Without limiting the foregoing, Carrier shall not disclose Customer Information collected hereunder to any third party in a manner that identifies an individual Vonage customer or subscriber (or aggregate Vonage customers or subscribers as a discrete group) as a user of the Services provided hereunder or a Vonage product or service, or use Customer Information to market any another produce or service. 
9.    RESOLUTION OF DISPUTES.
9.1    Prior to the initiation of litigation or mediation, the Parties shall first use all commercially reasonable efforts to resolve their dispute informally.  In particular, upon the written request of a Party referencing this Section 9, each Party shall appoint a designated senior representative who does not devote substantially all of his or her time to performance under this Agreement, whose task it will be to meet for the purpose of endeavoring to resolve such dispute. The representatives shall discuss the problem and attempt to resolve the dispute without the necessity of any formal proceeding. The specific format for the discussions shall be left to the discretion of the designated representatives.  Notwithstanding the foregoing, this Section 9.1 shall not prevent a Party from instituting, and a Party is authorized to institute, litigation earlier to avoid the expiration of any applicable limitations period, or to preserve a superior 

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

position with respect to other creditors, or from seeking any injunctive relief to which the Party may be otherwise entitled
9.2    Litigation regarding such dispute (other than billing disputes, which shall be exclusively handled pursuant to the procedures set forth in Section 9.3) may not be commenced until the earlier of: (i) the designated representatives concluding in good faith that amicable resolution through continued negotiation of the matter does not appear likely; and (ii) thirty (30) days after the initial written request to appoint a designated representative pursuant to Section 9.1 (this period shall be deemed to run notwithstanding any claim that the process described in this Section was not followed or completed);. 
9.3    In the event a billing dispute shall arise between the Parties to this Agreement which cannot be amicably resolved within thirty (30) days after the initial request to appoint a designated representative pursuant to Section 9.1, the Parties agree to participate in no less than four (4) hours of mediation in order to resolve the matter.  The mediation will involve each side of the dispute sitting down with a mutually-agreed upon impartial mediator, who shall be an attorney or retired judge practicing in the area of telecommunications law, to attempt to reach a voluntary settlement.  The mediation will be conducted in New York, NY and will involve no formal court procedures or rules of evidence.  
9.4    Each Party agrees to continue the performance of its respective duties and obligations under the Agreement during the pendency of any dispute.
10.    GOVERNING LAW.  Each Party agrees to continue performing its obligations under this Agreement during any dispute.  The Agreement shall be interpreted, construed and enforced in all respects in accordance with the laws of the State of New York, except for its conflicts of laws principles.  Each Party irrevocably consents to the exclusive jurisdiction of the courts of the State of New York and the federal courts situated in the State of New York in connection with any action to enforce the provisions of this Agreement, to recover damages or other relief for breach or default under this Agreement or otherwise arising under or by reason of this Agreement. Notwithstanding the foregoing, any judgments entered in an action under this Agreement may be enforced in any court of competent jurisdiction.  
11.    FORCE MAJEURE.
11.1    Neither Party shall be liable for any default or delay in the performance of its obligations under this Agreement if and to the extent such default or delay is caused, directly or indirectly, by fire, flood, lightning, earthquake, elements of nature or acts of God, riots, civil disorders, rebellions or revolutions, or any other cause beyond the reasonable control of such Party; provided, however, that the non-performing Party is without fault in causing such default or delay, and such default or delay could not have been prevented by reasonable precautions and cannot reasonably be circumvented by the nonperforming Party through the use of alternate sources, workaround plans or other means (any such event a “Force Majeure Event”).  Notwithstanding the foregoing, the failure of a Carrier supplier to perform under its arrangement with Carrier shall not constitute a Force Majeure Event for Carrier.  
9.2    For any Force Majeure Event, the non-performing Party shall be excused from further performance or observance of the obligation(s) so affected for as long as such circumstances prevail and such Party continues to use its best efforts to recommence performance or observance whenever and to whatever extent possible without delay. Any Party so delayed in its performance shall immediately notify the Party to whom performance is due by telephone (to be confirmed in writing within two (2) days of the inception of such delay) and describe at a reasonable level of detail the circumstances causing such delay.

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

9.3    If a Force Majeure Event substantially prevents, hinders, or delays Carrier’s performance for more than thirty (30) consecutive days, then Vonage may terminate this Agreement in its entirety without liability to Carrier as of a date specified by Vonage in a notice of termination to Carrier. Carrier shall not have the right to any additional payments from Vonage for costs or expenses incurred by Carrier as a result of any Force Majeure Event.
12.    ASSIGNMENT.  The Agreement shall accrue to the benefit of and be binding upon the Parties hereto and any permitted assignee, purchaser or any successor entity into which a Party has been merged or consolidated or to which a Party has sold or transferred all or substantially all of its assets.  No Party may assign this Agreement without the prior consent of the other Party, whose consent shall not be unreasonably withheld; except that Vonage may assign its rights and obligations under this Agreement without the prior consent of Carrier to an affiliate or related company, or to an entity which acquires all or substantially all of the assets of Vonage, or to a successor in a merger or acquisition of Vonage upon prior notice to Carrier.  Any attempted or purported assignment or transfer in contravention of the foregoing is null and void.
13.    NOTICE.  All notices, requests, demands, and determinations under this Agreement (other than routine operational communications or as otherwise specifically set forth herein), shall be in writing and shall be deemed duly given: (i) when delivered by hand; (ii) when successfully delivered by e-mail; (iii) one (1) business day after being given to an express, overnight courier with a reliable system for tracking delivery; (iv) when sent by confirmed facsimile with a copy delivered by another means specified in this Section; or (v) four (4) business days after the day of mailing, when mailed by U.S. mail, registered or certified mail, return receipt requested, postage prepaid, with respect to clauses (i) through (v) addressed as follows:
To Vonage:
Vonage America Inc.
23 Main Street
Holmdel NJ 07733
Attn:  Vice President - Carrier Operations    
Fax: 

With copy to:

Vonage America Inc.
23 Main Street
Holmdel NJ 07733
Attn:  Chief Legal Officer
Fax: 

To Carrier:
Tata Communications (America) Inc.    
2355 Dulles Corner Boulevard, Suite 700
Herndon, VA 20171
Attn:  General Counsel

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

14.    INTELLECTUAL PROPERTY RIGHTS.  Nothing in this Agreement shall confer or be deemed to confer on either Party any rights in or license to use any intellectual property right of the other Party.  No Party shall be entitled to use any brand name, trade name, trademark or service marks of the other Party, without such other Party’s express prior written consent.  Neither Party shall issue any press release, announcements and marketing, advertising or other promotional or publicity materials related to this Agreement or referencing the other Party or its brand name, trade name, trademarks or service marks without the express prior approval of the other Party.
15.    AUDIT RIGHTS.  
15.1    Carrier shall maintain complete and accurate books and records of, and supporting documentation for, all Service charges (including cost support and justification for all charges or proposed changes established on the basis of Carrier’s underlying costs) and Taxes, and all other materials, reports, filings, analysis, records, data and material information and data created, generated, collected, processed or stored by Carrier in the performance of its obligations under this Agreement (“Contract Records”).  Carrier shall maintain such Contract Records in accordance with applicable laws and regulations during the Term and thereafter for (i) for financial information, the period ending seven (7) years after the expiration or termination of the Term, or (ii) for non-financial records, the period ending two (2) years after Carrier ceased performance the Services, unless such shorter period is required by applicable law or regulation. 
15.2    Vonage and those of Vonage’s internal and external auditors, as Vonage may designate, shall have the right to audit any of Carrier’s Contract Records relating to the Services, as necessary for the purpose of performing audits to verify compliance with the terms of the Agreement, including to examine pricing and amounts invoiced by Carrier to Vonage, during Carrier’s normal business hours and upon reasonable advance written notice to Carrier.  In the event the audit reveals any discrepancy between the actual amounts due and the amounts previously paid by Vonage, then (a) Carrier shall promptly refund to Vonage the amount of any overpayment identified by such audit, together with interest from the date of such overpayment at one and one-half percent (1.5%) per month, or the highest lawful amount, whichever is the lesser; or (b) Carrier shall invoice and Vonage shall pay any underpayment identified by such audit.  The audit shall be conducted at Vonage’s expense unless a discrepancy resulting in an overpayment by Vonage of two percent (2%) or more is discovered for the period being audited, in which event Carrier shall pay, in addition to the refund, Vonage’s reasonable expenses for the portion of such audit relating to the overcharge.  Any reimbursement and payment of Vonage’s expenses required from Carrier as a result of such audits shall be made within thirty (30) calendar days of Carrier’s receipt of an invoice from Vonage for such payment. 
16.    PUBLICITY.  Neither Party shall issue any press release or make any other public announcements (in whatever form or medium) with respect to this Agreement or any SOW without the other Party’s prior written consent. The Parties shall consult with one another prior to making any announcements or governmental filings relating to the subject matter of this Agreement and will not make any disclosure without the consent of the other Party, unless such Party reasonably believes that it is required to do so by Law or pursuant to a listing agreement (or other similar agreement) with a national securities exchange or the NASDAQ National Market (in which case the disclosing Party shall use commercially reasonable efforts to give the other Party reasonable prior notice of and an opportunity to comment on such disclosure). If either Party determines that it is required by such Law or listing agreement to file or otherwise disclose this Agreement or any provisions hereof, that Party shall prior to such disclosure use commercially reasonable efforts to notify the other Party of such and use commercially reasonable efforts to obtain confidential treatment of this Agreement in its entirety or, if 

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

confidential treatment may not be reasonably obtained with respect to the entire Agreement, any and all provisions which the other Party may designate as sensitive or confidential in nature.
17.    MISCELLANEOUS.
17.1    Non-Exclusivity.  Unless and to the extent otherwise expressly set forth in an applicable service schedule (including its exhibits or any addenda thereto), this Agreement shall be non-exclusive and nothing in this Agreement shall prejudice, restrict or otherwise affect the right of either Party to enter into similar agreements with third parties.  
17.2    Entire Agreement.  This Agreement, along with the attached schedules and exhibits, constitute the entire agreement between Vonage and Carrier with regards to the matters dealt with herein and shall supersede any prior oral or written agreement between the parties that relates to the subject matter of this Agreement.
17.3    No Waiver.  No failure on the part of either Party to exercise, and no delay in exercising any rights or remedy hereunder, shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right or remedy granted hereby or by law.
17.4    Amendments.  This Agreement may not be amended, modified or changed except by mutual written agreement duly executed by authorized representatives of each Party.
17.5.    Electronic Delivery. The Parties agree that signatures transmitted and received via facsimile or scanned and electronically delivered shall be treated for all purposes of this Agreement as original signatures and shall be deemed valid, binding and enforceable by and against both Parties.

17.6    Third Party Rights.  Nothing contained herein shall be construed as creating any agency, partnership, or other form of joint enterprise between the Parties.  Neither Party is, by virtue of this Agreement, authorized as an agent, employee or legal representative of the other.  Neither Party shall have any power or authority to bind or commit the other.    
17.7    Severability.  In the event that any provision of this Agreement conflicts with the law under which this Agreement is to be construed or if any such provision is held invalid by a court with jurisdiction over the Parties, such provision shall be deemed to be restated to reflect as nearly as possible the original intentions of the Parties in accordance with applicable law.  The remainder of this Agreement shall remain in full force and effect.  
17.8     Survival. Vonage’s and Carrier’s respective obligations under this Agreement which by their nature would continue beyond the termination, cancellation or expiration of this Agreement or any SOW shall survive, including Sections 6 through 17.

17.9    Other.  Any conflicts among or between the documents making up this Agreement will be resolved in accordance with the following order of precedence: (a) exhibits; (b) service schedules; and (c) the terms and conditions set forth in the body of this Agreement.  Unless otherwise specified in the 

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

Agreement, references to days shall be deemed references to calendar days.  All service schedules and exhibits attached hereto are hereby incorporated by reference into the Agreement.
IN WITNESS WHEREOF, the Parties have duly executed this Agreement, by the hands of their respective duly authorized officers in that capacity.
Vonage America Inc.                Tata Communications (America) Inc.

Signature:____________________________    Signature:____________________________
Name: ______________________________    Name: ______________________________
Title: _______________________________    Title: _______________________________
Date: _______________________________    Date: _______________________________

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

SCHEDULE 1 
INTERNATIONAL CALL TERMINATION SERVICES
This Schedule 1 is attached to and incorporated into the Voice Termination Agreement made between Vonage and Carrier.
1.    Services.
1.1    Carrier will establish and provide two-way call termination services (i) for calls placed from Vonage subscribers and terminating to the international destinations specified or referenced in Exhibit 1-A to this Schedule 1, as may be supplemented or revised from time-to-time upon seven (7) days’ prior written notice from Carrier to Vonage, and (ii) for calls placed from retail subscribers of Carrier and terminating to Vonage subscribers (“International Call Termination Services”).  
1.2    Each Party agrees to the following Credit Limit in connection with the International Call Termination Services to be provided under this Schedule 1: ∗.
2.    Interconnection and Traffic Exchange.
2.1    Vonage and Carrier agree to interconnect their respective networks or communications systems at a Vonage-designated location (the “Meet-Me-Location”).  The Meet-Me-Location shall represent the demarcation point of responsibility for traffic and facilities between the Parties.  Vonage shall be responsible for acquiring and paying for facilities to the Meet-Me-Location, whether purchased from Carrier, a third party vendor, or self-provisioned.  Carrier is financially and operationally responsible for the facilities and routing of calls from the Meet-Me-Location to the called party.
2.2    Each Party shall coordinate the management of their respective system facilities on their side of the Meet-Me-Location.  Each Party shall interface on a 24 x 7 basis to assist each other with the isolation and repair of any facility faults in their respective networks, and with the identification, investigation and mitigation of real time traffic flow problems to and from any International Call Termination Service destination.
3.    Accounting and Method of Settlement.  
3.1    Carrier will invoice Vonage the Net Settlement Amount based on the Net Settlement Procedure for International Call Termination Services based on the Billable Time recorded by the Carrier facilities, all as subject to the calculation of Billable Time recorded by Vonage’s facilities.  “Billable Time” is defined as the number of seconds from when an answer supervision signal is recorded by either Party to when a disconnect signal (i.e., “Release” message (first party hangs up) and “Release Complete” message (last party hangs up)) is recorded by either Party, rounded up to the nearest second.  International calls shall be billed in one (1) second minimums with one (1) second increments, except with regards to Mexico destined calls which shall be billed at sixty (60) second increments with a sixty (60) second minimum.
3.2    Carrier shall invoice Vonage for International Call Termination Services in accordance with the rates attached hereto at Exhibit 1-B.  Subject to the Net Settlement Procedure, Carrier shall invoice Vonage for the product of Billable Time and the rates and Taxes set forth in Exhibit 1-B, and no other charges, taxes, surcharges, costs or assessments may apply.  

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

3.3    Subject to any limitation or restrictions set forth in an applicable addendum hereto, Carrier may increase such rates upon seven (7) calendar days’ written notice to Vonage.  Rate decreases shall take effect upon one (1) calendar day’s written notice.  Any rate increase will take effect as of and from 00:00:01 a.m. EST on the seventh (7th) full calendar day following the date of receipt of the notice.  Any rate decreases will take effect as of and from 00:00:01 a.m. EST on the first (1st) full calendar day following the date of receipt of the notice.  Notifications of rate increases or decreases shall be represented in U.S. dollars and provided via e-mail to:  
Vonage Network Inc.
RateChange@Vonage.com
        
3.4    All international code changes including, without limitation, deletions, additions or modifications of any kind that may have the effect of increasing costs to Vonage, shall not become effective unless and until Vonage has received seven (7) days’ prior written notice of the same.  Such notice, and the specifics of the code changes, shall be delivered to via email to the address specified in Section 3.2 and shall in all material respects resemble the format attached hereto as Exhibit 1-C.
3.5    Carrier shall maintain accurate Contract Records of all International Call Termination Services provided and all settlement charges (including cost support and justification for all charges or proposed changes established on the basis of Carrier’s underlying costs) payable for such International Call Termination Services, which records shall be maintained on-site with an off-site back-up copy for a minimum period of seven (7) years, at which time such records may be moved for permanent off-site storage.

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

EXHIBIT 1-A
International Call Termination Service Destinations

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

EXHIBIT 1-B
International Call Termination Service Rates

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

EXHIBIT 1-C
International Rate and Code Change Notification Form

		
	•
	Carrier agrees to adhere to the following change guidelines. The entire rate change notice must be correct and comply in full with the requirements below. Incorrect or non-compliant rate and code change notification forms are subject to rejection by Vonage with written notice.  If a rate/code notification does not comply with Vonage format, Vonage must notify Carrier via the carrier’s operational email address within three (3) business days. Vonage’s notification shall indicate those destinations, countries and basis for the rejection.  Vonage has the right to reject/not accept the changes and not be charged for those countries at the newer rates which include destinations that are in error. Thus, upon receipt of such notification, all the then current rates provided for all destinations within such countries remain in effect until such time as carrier has issued a rate change in the acceptable format and timeframes. Vonage may choose to block (at its discretion) the carrier for countries which have destinations that are not in the correct format.

		
	•
	All rate modification notices must be emailed to Vonage at ratechange@vonage.com.

		
	•
	All emailed addendums must include an attachment in Excel format. (No free flowing emails, .html files, adobe files etc.)

		
	•
	Rates must be sent in the currency specified in your contract with Vonage

		
	•
	All destinations require both full code definition breakout and rate.

		
	•
	Corresponding effective date(s) must be listed with each destination breakout change.

		
	•
	Status of changes must be included in the rate table (Increase, Decrease, or Restatement / No Change if applicable or  reasonable variant terminology thereof)

		
	•
	All rates and codes must be listed vertically. No horizontal code lists and or multiple code listings in single cells will be accepted.

		
	•
	All Country Codes must be in a separate column from the Dial codes / City codes.  

	
						
	e.g. Not Acceptable
	 
	 
	 
	 
	 

	Destination
	Cc
	Codes
	Rate
	Status
	Effective Date

	Brazil Sao Paulo Cellular
	55
	117, 118, 119
	0.0825
	Decrease
	4/25/2006

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

	
						
	e.g. Acceptable
	 
	 
	 
	 
	 

	Destination
	Cc
	Codes
	Rate
	Status
	Effective Date

	Brazil Sao Paulo Cellular
	55
	117
	0.0825
	Decrease
	4/25/2006

	 
	55
	118
	0.0825
	Decrease
	4/25/2006

	 
	55
	119
	0.0825
	Decrease
	4/25/2006

		
	•
	When applicable, Code Changes must be included, indicating the nature of the change. I.e. New, Add Code, Remove Code, Replace Code etc. or reasonable variant terminology thereof.

		
	•
	Should the code change result in a rate change, please indicate increase, decrease, or restatement as appropriate. "New" code offerings should reflect appropriate effective dates. I.e. I - Increase, D - Decrease, R – Restatement or reasonable variant terminology thereof.

		
	•
	When making any change in either code or rate to any destination breakout, all breakouts for the destination should accompany the change inclusive of their corresponding rates, codes etc regardless of whether these particular codes are being affected. (see below)

e.g. Acceptable
	
						
	Destination
	CC
	Codes
	Rate For
	Status
	Effective

	 
	 
	 
	New Codes
	 
	Date

	Afghanistan
	93
	 
	Sample Rate
	Unchanged
	 

	Afghanistan Cellular
	93
	70
	Sample Rate
	Unchanged
	 

	Afghanistan Cellular
	93
	79
	Sample Rate
	Add
	2/4/2006

	Albania
	355
	 
	Sample Rate
	Unchanged
	 

	Albania Cellular
	355
	38
	Sample Rate
	Remove
	2/4/2006

	Albania Cellular
	355
	68
	Sample Rate
	Unchanged
	 

	Albania Cellular
	355
	69
	Sample Rate
	Unchanged
	 

	Albania Tirana
	355
	54
	Sample Rate
	Unchanged
	 

	Algeria
	213
	 
	Sample Rate
	Unchanged
	 

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

	
						
	Algeria Algiers
	213
	21
	Sample Rate
	Unchanged
	 

	Algeria Cellular
	213
	61
	Sample Rate
	Unchanged
	 

	Algeria Cellular
	213
	62
	Sample Rate
	Add
	4/4/2006

	Algeria Cellular Orascom
	213
	7
	Sample Rate
	New
	4/4/2006

	Algeria Cellular Wataniya
	213
	50
	Sample Rate
	New
	4/4/2006

	Algeria Cellular Wataniya
	213
	51
	Sample Rate
	New
	4/4/2006

	Algeria Cellular Wataniya
	213
	52
	Sample Rate
	New
	4/4/2006

	Algeria Cellular Wataniya
	213
	53
	Sample Rate
	New
	4/4/2006

	Algeria Cellular Wataniya
	213
	54
	Sample Rate
	New
	4/4/2006

	Algeria Cellular Wataniya
	213
	55
	Sample Rate
	New
	4/4/2006

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

EXHIBIT 1-D

VONAGE INFORMATION SECURITY POLICY

INTRODUCTION

In order to comply with Vonage’s network security requirements regarding protection of our customers’ voice traffic, Carrier agrees to adhere to the terms of this Information Security Policy (the “Policy”) which describes the rights and responsibilities of Vonage and Carrier with regard to the interconnection of data facilities between Carrier and Vonage.  Capitalized terms used but not otherwise defined in this Policy have the meaning ascribed to such terms in the Voice Termination Agreement (the “Agreement”). 
POLICY
It is the policy of Vonage to ensure the protection of its Information Resources and proprietary and confidential information in all situations and wherever they are located. “Information Resources” shall include, but are not limited to: computers, computer peripherals, computer communications networks, computer systems, applications and software, web sites, data stores, information processing systems, public telephone network elements, and their support systems.  This Policy is intended to protect the confidentiality of all Vonage corporate, employee and customer information that is stored, accessed, processed or transmitted (or otherwise available for same) on the Information Resources.  Carrier has specific obligations with regard to the protection of Information Resources and proprietary and confidential information.  This Policy shall set forth the minimum requirement for security of voice peering partners. 

GENERAL TERMS
		
	1.
	General.  Carrier shall:

		
	a.
	Securing Data.  

		
	i.
	Secure confidential data, including Vonage network and design information;

		
	ii.
	Avoid inappropriate disclosure of proprietary Vonage information or customer data (e.g., Carrier shall not use internet message boards to post internal confidential information); and

		
	iii.
	Bargain in good faith for the provision of additional Vonage security needs not identified in the Agreement.

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

		
	b.
	Contacts.  Provide Vonage, within fifteen (15) days of the Effective Date of the Agreement, an escalation list of contacts for security issues (e.g., viruses, breaches, etc) to the Vonage POC.

		
	c.
	Usernames and Passwords.  

		
	i.
	Ensure that systems used in support of services to Vonage have login procedures that are designed and implemented with a mechanism that will thwart the use of repeated login attempts to guess or otherwise determine a valid login identification and authentication combination.  The process shall always cause the person or machine to reinitiate the login process after a maximum of no more than nine successive unsuccessful attempts.

		
	ii.
	Report potentially compromised usernames and passwords to the Vonage POC or the Vonage Information Security. This includes any Carrier-owned devices that are unaccounted for that may contain Vonage information (e.g., stolen or misplaced laptops, personal device assistants, etc.).

		
	d.
	Reporting Trouble.  Report to Vonage Information Security, within one day of discovery, any known or suspected unauthorized access, use, misuse, disclosure, destruction, theft, vandalism, modification, or transfer of Vonage information.

		
	2.
	Vonage Data and Information.

		
	a.
	Treatment of Vonage Information and Data.

		
	i.
	Ensure the reliability and integrity of all Vonage information and information resources under its control, and the information processing activities performed with or for Vonage.  

		
	ii.
	Maintain the proprietary nature and, if necessary, the proprietary marking(s), of any Vonage proprietary information.

		
	iii.
	Not use or transfer Vonage information or data for any purpose not explicitly defined and authorized in the Agreement.  This shall include aggregate, trend and assimilated data. 

		
	b.
	Destruction of Information.  

		
	iii.
	Unless otherwise explicitly directed elsewhere in the Agreement, or as provided by law, all Vonage-owned information must be (A) destroyed in a manner that causes all personally identifiable information and all confidential data to be irrecoverable, or (B) returned to Vonage upon completion of the Services in a manner acceptable to Vonage information technology.

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

		
	c.
	Access to Information.  Ensure that only persons with an approved need to know are allowed to access Vonage information, and confidential information, and only to and for the limited extent and purpose for which such persons have a need to know.  This shall include controls that allow a person to access only the specific information and information resources required to perform the Services specified in the Agreement and for which that person is authorized.

		
	3.
	Personnel Requirements.  For each of Carrier’ Personnel and its Affiliates’ and Authorized Subcontractors’ Personnel who may have access to Vonage proprietary and confidential information, or a computer, computer system, or computer communications network containing such, or a computer system, application or network providing capabilities to Vonage: 

		
	a.
	Perform an appropriate background check to ensure that no such person is assigned to a Vonage account if the person:

		
	iv.
	Has been convicted of a felony or misdemeanor offense related to computer security, theft, fraud or violence within the past five years; or

		
	v.
	Is currently awaiting trial for any of the above-stated offenses.

		
	b.
	Immediately advise Vonage of any information of which Carrier becomes aware that would reasonably provide notice of potential threats to the Information Resources, assets, or personnel of Vonage.

		
	c.
	Ensure that individual access and accountability controls are in place for each of Carrier’s employees and representatives who will access a Vonage system, application or other Information Resource including resources owned and operated by or for Carrier that may contain Vonage confidential information, or route Vonage customer’s telephone calls.  Accountability/audit records shall be kept for a period of no less than ninety days.

		
	4.
	Use of and Interaction with the Vonage Global Network

		
	a.
	Connections Generally.  

		
	i.
	Ensure that internet network connections are designed, implemented and maintained so as to secure and protect information, data, and system operation during the life of the Agreement.  This includes, but is not limited to, non-repudiation, authentication, authorization, and monitoring issues.  

		
	ii.
	Provide current and adequate patch levels to the operating system of any hosts or network elements that will provide service to Vonage.

		
	iii.
	Enable security logging on Carrier’s hosts and gateways that provide services under the Agreement such that forensic identification of users is enabled and available for immediate review for a minimum period of ninety (90) days, with offline storage for a minimum of one year.

- 32 -
 
Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

		
	b.
	Security Mechanisms.  

		
	i.
	Ensure that authentication mechanisms to the Carrier’s operating systems and network components are complex and not easily overcome.  There shall be no known way to bypass the authentication mechanism and obtain entry into the system.  Token-based authentication devices, smart cards or biometric devices are recommended.  If passwords are to be used, they must:

		
	A.
	Be at least seven (7) characters in length for users and eight characters in length for administrators and maintenance personnel;

		
	B.
	Contain both alphabetic and numeric characters;

		
	C.
	Be aged at least every ninety(90) days; and

		
	D.
	Not be reusable.  A system must employ a password reuse utility that prevents a password from being reused  that matches one of the last five (5) password changes used.

		
	5.
	Security Programs and Audits

		
	a.
	Internal Security Policy.  Currently have, or agree to implement, an internal security policy governing the protection of its own information resources and the resources of others under its control.  Such policy shall be subject to Vonage’s review and approval.  A copy of Carrier’s security policy shall be made available upon request.

		
	b.
	ISO/IEC.  

		
	i.
	Currently have, or agree to implement, a robust information security program that complies with the International Organization for Standardization and the International Electrotechnical Commission (ISO/IEC) for the Code of Practice for Information Security Management (ISO/IEC 17799:2005(E) or its current standard.

		
	c.
	SAS 70/SSAE16 Assessment.  Provide, as reasonably required by Vonage, an annual SAS 70 Type II or SSAE16 assessment or allow a review by Vonage of the security controls of Carrier for obligations under relevant laws (e.g. U.S. Sarbanes-Oxley Act of 2002) affecting the delivery of Services for the Agreement.

		
	d.
	Equipment Audits.  

		
	i.
	Allow Vonage designated parties to inspect, with seven (7) business days’ notice, all computer software, files and records whether resident on equipment owned, leased or controlled by Carrier and/or its Personnel and Authorized Subcontractors, data obtained from, or resulting from the use of, Vonage's information resources for the purposes of conducting a routine security assessment and audit. Vonage's routine audits/inspections include, but are not limited to, operating system security, 

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

Confidential and Proprietary
DISCUSSION PURPOSES ONLY

application security, database security, physical security (doors, windows, walls, and card access system), network security, and program change control. 
		
	ii.
	In the event Vonage has a good faith belief that Carrier or its employees or agents may have violated terms of this Policy or applicable laws governing the security and privacy of customer information, Vonage may provide notice of such inspection on one (1) business day’s notice.  Upon notification of such an inspection, the computer systems and information used to provide services under the Agreement shall be placed into an untampered state that is auditable and available for such inspection.

		
	6.
	Security Changes and Updates.  

		
	a.
	Implementation.  Implement security changes, patches and upgrades in systems, applications and software in a timely manner and commensurate with the threat to Vonage data or security as directed by the manufacturer and subject to appropriate testing, but, in any event, no later than ninety (90) days from release.  Security changes, patches and upgrades correcting significant or immediate security issues shall be implemented immediately, subject to appropriate testing under the circumstances, but no later than ten (10) days after their release unless a longer period is recommended by the manufacturer or agreed to by the Vonage Information Security organization.

		
	b.
	Reviews.  Have an effective change management program in place that provides for management review of any changes to systems that would affect performance of services to Vonage. A Vonage POC must be included in any change management discussion that could adversely affect performance of such services.

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Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

SCHEDULE B 
Peer Supplier List

Peer Supplier List:

*

Portions herein identified by ∗ have been omitted pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  A complete copy of this document has been filed separately with the Securities and Exchange Commission.

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