SERVICE CREDIT AGREE.--LEVEL 3 COMM.

Exhibit 10.3



SERVICE CREDIT AGREEMENT



THIS SERVICE CREDIT AGREEMENT (the "Credit Agreement") is entered into this 23rd day of July, 1999, by and between LEVEL 3 COMMUNICATIONS, LLC, a Delaware limited liability company ("Level 3") and DATA RETURN CORPORATION, a Texas corporation ("Customer").





Customer and Level 3 have entered into a Strategic Marketing and Sales Agreement dated July 1, 1999 (the "Marketing Agreement") pursuant to which, among other things, Customer agreed to purchase minimum quantities of "Broadband Services" (as defined in the Marketing Agreement); and



Customer and Level 3 have entered into a Restricted Stock Purchase Agreement dated July 23rd, 1999 (the "Restricted Stock Purchase Agreement"), pursuant to which, among other things, Level 3 agreed to acquire, and Customer agreed to convey to Level 3, an equity interest in Customer; and



Under the terms of the Restricted Stock Purchase Agreement and as consideration for the conveyance of the equity interest described therein, the parties agreed that Level 3 would execute this Credit Agreement respecting credits which may be available (as defined below) for certain quantities of Broadband Services purchased by Customer under the Marketing Agreement or otherwise as specified herein.



NOW, THEREFORE, the parties agree as follows:



1. Defined Terms. Capitalized terms used but not defined herein shall

------------- have the meanings set forth in the Marketing Agreement.



2. Credit for Purchase of Broadband Services.

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(a) In each month commencing January 1, 2001, Customer shall be entitled to a credit of up to but not exceeding a cumulative total of five million dollars ($5,000,000.00), which credit may be applied against, and only against (except as set forth in subparagraph (b) below), amounts owed by Customer for purchase of "Excess Broadband Services" (as defined below). For purposes hereof, "Excess Broadband Services" shall mean all Broadband Services purchased and paid for by Customer in any quarter which are in excess of the quarterly Revenue Commitment set forth in Section 2.2 of the Marketing Agreement; provided, that the quarterly Revenue Commitment will be deemed satisfied first through the purchase of any Services other than Broadband Services.

Thus, as an example, if Customer's Monthly Recurring Charges for Broadband Services in the first three months of 2001 were as follows:



January $100,000

February $150,000

March $200,000



then (because the applicable quarter under the Marketing Agreement commenced on January 1, 2001) Customer would be entitled to a credit on the invoice showing March billings of $150,000 (i.e., the extent to which the cumulative quarterly billings exceeded the quarterly Revenue Commitment of $300,000 set forth in Section 2.2 of the Marketing Agreement). If, on the other hand, the Monthly Recurring Charges for the first three months of 2001 were as follows:



January $400,000

February $500,000

March $600,000



then Customer would be entitled to a credit in the invoice showing January billings of $100,000, and would be further entitled to a credit on the February and March billings of $500,000 and $600,000 respectively (Customer having satisfied fully the ...