Common use of Property Interest Clause in Contracts

Property Interest. 2.3.1 Purchaser shall have no legal title or ownership in the physical assets of the Xxxxxxxx Network itself, including any proceeds from the disposition of the Xxxxxxxx Network. Notwithstanding the preceding sentence, it is understood and agreed that the grant of the Backhaul IRU and the Wavelength IRUs is intended by the parties hereto to be treated for accounting and all applicable tax purposes, as the sale and purchase of the Backhaul IRU and Wavelength IRUs, and that on and after the Backhaul Closing Date and the Wavelength Closing Date, as applicable, Purchaser or its Affiliates shall be treated as the owner of the Backhaul IRU and the Wavelength IRUs for such purposes. Except as a party may otherwise reasonably deem required by or appropriate under law or accounting standards, the parties agree to make financial accounting filings and tax returns consistently with such treatment. 2.3.2 The parties intend that the transactions contemplated by this Agreement shall constitute a sale to Purchaser of the rights that constitute an IRU and not a lease or other contract for provision of capacity by Seller to Purchaser. 2.3.3 In the event that (i) Seller does not have the underlying rights to grant an IRU on portions of the Backhaul IRU or the Wavelength IRUs or (ii) any jurisdiction in which the Xxxxxxxx’ Network is located does not currently recognize, or does not recognize in the future, the conveyance of telecommunications facilities on an IRU basis, then as to such portions of the Backhaul IRU or Wavelength IRUs or such jurisdiction(s) only, this Agreement shall be considered an agreement for a lease of such capacity (a “Capacity Lease”). The term of the Capacity Lease shall be for the IRU Term of the Backhaul IRU or Wavelength IRUs, as the case may be. All amounts owed under this Agreement shall be paid as provided in this Agreement and Purchaser shall not be required to make any additional payments as a result of the above-described change in status of the rights granted under this Agreement. Notwithstanding the foregoing, the Capacity Lease shall provide Purchaser with all of the same rights and privileges contained in this Agreement for the Backhaul IRU or Wavelength IRUs, except for the nature of such interest. 2.3.4 In the event that this Agreement is deemed a Capacity Lease in one or more jurisdictions, then as to such jurisdictions only, the terms “purchase,” “purchaser,” and any variations thereon shall mean “lease,” “lessee,” or the appropriate variation thereof, and the terms “indefeasible and exclusive right of use” and “IRU” shall mean “Lease.” Any other terms and conditions of the Agreement also shall be deemed modified only to the extent necessary to be consistent with the grant of a lease to Purchaser. All other terms and conditions of the Agreement shall remain unchanged and fully valid and enforceable.