Understanding early termination on United Business Solutions Service Contracts

Summary This article explains the key details and common terms found in United Business Solutions service contracts, how those terms are applied, and how to request signed copies of contracts.

Key contract terms and their meaning

• Contract period and enforcement

  • Service contracts are executed for a fixed contract period and the company enforces that contract period.
  • Clients are expected to honour the agreed contract period.

• Minimum billing (not usage billing)

  • Billing is based on the minimum monthly amount agreed at the start of the contract rather than on actual device possession or immediate usage.
  • The company may continue to bill the agreed minimum even if devices have been removed or settled through a finance company.

• Service settlements

  • A service settlement is an amount related to the service contract that can be requested when a customer changes providers or terminates service before the contract period ends.
  • It is common practice in the industry to require service settlements when contracts are ended early.
  • Service contracts are generally billed separately to Rental Contracts.

• Reason for minimum billing and settlement requirements

  • United Business Solutions supplies parts and service that can cost significantly more than the monthly billing value recovered from usage.
  • Example: replacement drums may cost R4,000–R5,000 while monthly billing for usage could be around R800–R1,000. Supplying high-cost parts while billing only small monthly amounts would cause a loss if contracts were cancelled immediately without settlement.

How contract terms are applied in practice

• When a contract is signed, the minimum monthly billing and contract period are agreed up front and enforced for the duration of that period.
• If devices are collected or financed separately but the service contract remains in force, the agreed minimum billing can still be charged.
• When switching to a new provider, customers should expect the possibility of service settlement requests from the previous provider.

How to obtain signed service contracts

• Request signed copies from the Accounts Team by emailing accounts@unitedbusiness.co.za .
• Accounts will ask your account manager to send on requested contracts.

Practical steps for customers

1. Review your signed service contract to confirm:
   • The contract period (start and end dates).
   • The agreed minimum monthly billing amount.
   • Any clauses related to early termination or service settlements.
2. If you plan to change providers, check the contract for settlement obligations and prepare to address any outstanding service settlement.
3. To obtain a copy of your signed contract, contact the Accounts Team and request all signed service contracts for your account. You account manager will be able to assist explanation around our billing as well as Terms and Conditions.

Conclusion Service contracts include a fixed contract period, an agreed minimum monthly billing (rather than purely usage-based billing), and potential service settlement obligations when a contract is ended early. These terms exist to cover the cost of supplying expensive parts and services that exceed monthly usage billing. For a copy of your signed contract or to confirm specific terms, contact the Accounts Team.