Exhibit 10.11
SERVICE AGREEMENT
THIS SERVICES AGREEMENT (the "AGREEMENT") is entered into and effective
as of April 1, 2002 by and between:
CLEARWAVE SERVICES (MAURITIUS) LTD., a limited liability company
incorporated under the laws of Mauritius, having its head office at 000 Xx.
Xxxxx Xxxxx, Xx. Denis Street, Port Louis, Mauritius, registered with Register
of Companies, Port Louis, under file no. 24170/5709, duly represented by Xxxxx
Xxxxxx (hereinafter referred to as "THE SERVICE PROVIDER"),
And
CLEARWAVE HOLDINGS BV, a company organized and existing under the laws
of The Netherlands, having its headquarters located at Strawinskylaan 707 1077
XX Amsterdam, registered with Amsterdam Chamber of Commerce under no.34171018,
duly represented by Xxxx Xxx Xxxxxxxxxx, or any affiliated company thereof
(hereinafter referred to as " THE BENEFICIARY "),
hereinafter collectively referred to as the "PARTIES", each a "PARTY".
RECITALS
WHEREAS, the Beneficiary's customer is engaged in the mobile telephony
business in Romania and has experienced personnel in the area of designing,
installation, maintenance and development of mobile telecommunications networks;
WHEREAS, the Beneficiary's customer is continuing to improve its
technical and management strategy for enlarging the customer portfolio and
therefore envisages a business growth which requires additional resources of
highly-skilled personnel with specific expertise in the mobile telephony
industry;
WHEREAS, the supplied staff shall be working under the authority of the
Beneficiary's customer;
WHEREAS, both Parties are willing to enter into this Agreement;
NOW THEREFORE, in consideration of the foregoing recitals and the
covenants and conditions set forth in this Agreement, the Parties agree as
follows:
1. SCOPE OF WORK
1.1 Service Provider agrees to supply the services stipulated under Section
1.2. (hereinafter called "the Services") directly to the Beneficiary's
customer to whom the Beneficiary undertook to render services similar
and/or identical with the Services hereunder and the Beneficiary agrees
to pay the Service
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Provider a Service Fee under the terms and conditions stipulated under
Section 4 below.
1.2 The Services rendered by the Service Provider to the Beneficiary shall
consist of supply of personnel to meet even a temporary and/or sudden
demand for personnel (hereinafter called "the Personnel") raised by the
Beneficiary to the Service Provider. Every time the Beneficiary decides
at the request of its customer that it needs to have available a number
of personnel who can be suddenly assigned to complete works for the
Beneficiary's customer, the Service Provider shall ensure the supply of
Personnel to the Beneficiary's customer. The Personnel shall carry out
the following tasks (hereinafter called the "Tasks"):
1.2.1. provide technical and operational support relating to technical and
operational processes and systems necessary to allow the Beneficiary's
customer to develop into a first tier wireless operator in Romania,
including general management, project management, information systems
and technology, network management, deployment and expansion and
marketing support;
1.2.2. provide support to the Beneficiary's customer, including through the
following:
- planning, projecting, installing, operating and maintaining
wireless systems;
- studies on market demand, marketing and sale of wireless services;
- financial and reporting structure of the Beneficiary's customer and
its subsidiaries and branches; and
- structure of human resources, business plan and tariff structure.
1.2.3. provide, through the Service Provider's personnel, further support
services e.g. financial and accounting services, legal services, ad hoc
support services for bids or acquisitions, and project management
services.
1.3. From time to time, the Beneficiary shall order Services through a
request to the Service Provider using the service request form
("SERVICE REQUEST"), a copy of which is attached hereto as Appendix A.
Within ten (10) business days after receipt of the Service Request, the
Service Provider shall send the Beneficiary a completed staffing
authorization form ("STAFFING AUTHORIZATION FORM"), a copy of which is
attached hereto as Appendix B, for execution by both the Service
Provider and the Beneficiary.
1.4. The Services rendered by the Service Provider may be expanded to cover
other services only in writing through an Additional Act hereto.
1.5. The Personnel supplied hereunder shall not have the right to represent
the Beneficiary's customer in the latter relations with third parties.
Notwithstanding its assignment to the Beneficiary's customer, the
Personal shall remain throughout the duration of the assignment the
employee or consultant of the Service Provider.
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1.6. The Personnel supplied based on this Agreement shall be working under
the supervision of the Beneficiary's customer and shall follow
exclusively the instructions received from Beneficiary's customer
2. PROVISION OF SERVICES
2.1 The Service Provider undertakes to recruit and appoint the appropriate
Personnel to carry out in favour of the Beneficiary's customer the
Tasks referred under the herein Agreement.
2.2 The Service Provider shall perform its Services according to the best
of its abilities. The liability for the timely and appropriate delivery
of Personnel shall be entirely and exclusively borne by the Service
Provider. The Service Provider accepts to be held liable by the
Beneficiary's customer referred to under Section 1.1., to whom the
Beneficiary assigned the right to exercise directly any and all claims
the Beneficiary might have against the Service Provider hereunder. The
Beneficiary included in the service agreement concluded between the
Beneficiary and its customer an appropriate language regarding the
assignment to its customer of any and all rights related to the
aforesaid claims in Court and off Court.
2.3 When any documents or any other goods related to the performance of the
Services under this Agreement are in the Service Provider's possession
in order to ensure the proper rendering of the Services, the Service
Provider shall ensure that all the above items are stored and
maintained under such conditions that the quality of the goods is not
affected and the access of third parties to the documents is closed
unless otherwise required by the Beneficiary or directly by the
Beneficiary's customer. The Beneficiary shall not have in possession
any company documents or any other goods belonging to the Service
Provider or to the Beneficiary's customer.
2.4 At all times, the Beneficiary and/or its customer shall provide the
Service Provider with access to the information required for the
provision of the Services and completion of the Tasks. More
specifically, the Beneficiary and/or its customer shall provide the
Service Provider with access to its staff and information required for
the completion of the Tasks, in accordance with the provisions of this
Agreement. Any delay, misconduct, non-performance or any other kind of
non-compliance with the Beneficiary's obligation and/or with the
obligation of the Beneficiary's customer as stipulated under the
agreements between the Beneficiary and the Service Provider and
respectively between the Beneficiary's customer and Beneficiary, to
render the Service Provider with access to information shall
accordingly exonerate the Service Provider which have acted diligently
from its obligations under this Agreement, until the Beneficiary and/or
the Beneficiary's customer remedy/s the situation or when the
contractual terms of the Service Provider's obligations are re-assessed
under the new circumstances.
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3. THE SERVICE PROVIDER'S RESPONSIBILITY
3.1 The Service Provider shall not be liable towards the Beneficiary and/or
the Beneficiary's customer for the damages suffered by the latter as
the result of the non-compliance with the advice provided by the
Service Provider's personnel.
3.2 In no event shall the Service Provider be liable for any loss, damage,
cost or expense arising in any way from or connected with negligence or
neglect, fraudulent acts or omissions, misrepresentations or willful
default by the Beneficiary, its employees, the Beneficiary's customer
and its employees and/or any other related entities or other providers.
4. PAYMENT
4.1. For the purposes of this Agreement, the Beneficiary shall pay, in
consideration of the Services provided hereunder by the Service
Provider the Service Fee computed as shown below.
4.2. The Services shall be billed to the Beneficiary at the Service
Provider's costs and expenses incurred with respect to such Services,
taking into account only the employee costs or expenses which are
directly and/or indirectly related to the Services performed, plus the
xxxx-up referred to under Section 4.7 herein.
4.3. The costs and expenses directly and indirectly related to the Services
performed, as referred to under Section 4.2. above, include without
being limited to:
4.3.1. Labour costs, consultant fees and expenses incurred by the Service
Provider in connection with the Services;
4.3.2. All other reasonable costs (i.e. travel, hotel accommodation, meals,
conferences, business training, administrative and any other
miscellaneous expenses) incurred by the Service Provider and directly
or indirectly related to the provision of the Services.
4.4. There shall be no charges for time spent by representatives of the
Service Provider in attending meetings of the Board of Administration
or General Assembly of the Shareholders of the Beneficiary's customer
if the course of business would require the occasional attendance of
such meetings by the Service Provider's employees or consultants. Such
employees and/or consultants of the Service Provider attending the
Board of Administration or General Assembly of the Shareholders shall
not represent the Beneficiary's customer in the latter relations with
third parties and shall not be considered to become permanent members
in the Board of Administration or the General Assembly of Shareholders.
4.5. The estimated annual costs shall be submitted for approval to the
Beneficiary at the commencement of each fiscal year in the form of an
annual budget. The
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projections of the estimated annual cost shall be based on the monthly
cost multiplied by the expected number of months of service. The
estimated annual costs shall cover the minimum amount of Services
needed by Beneficiary's customer throughout a business year and which
are to be rendered by Service Provider under this Agreement. Services
in addition to the scope budgeted hereunder shall be rendered by the
Service Provider upon the Beneficiary's request and the adjustment
regarding these Services shall be performed in accordance with Section
4.6 below.
4.6. If there are any differences between the projections of the estimated
total costs and the costs actually incurred directly or indirectly by
the Service Provider in relation to the Services hereunder, the
difference shall be invoiced by the Service Provider at the end of the
year only if approved by the Beneficiary and if it is properly
documented.
4.7. In addition to these costs set forth above, the Service Provider may
add a profit xxxx-up of not exceeding 10% (ten percent) on all related
costs incurred internally but not on disbursement for services provided
by third party subcontractors.
4.8. The value of Services shall not include any related VAT and other
indirect tax.
4.9. All payments to be made by the Beneficiary hereunder shall be made
without set-off or counterclaims. If any deduction is required by law
to be made from a payment hereunder, by way of tax, all such deductions
shall be executed out of the amount of Service Fee as stipulated
herein.
4.10. All payments made by the Beneficiary hereunder shall be made under the
invoice issued by the Service Provider in consideration of each amount
owed by the Beneficiary in return for the Services effectively
rendered. The invoice may state the location where the Services were
effectively rendered.
4.11. Payment of each invoice issued by the Service Provider shall be made by
the Beneficiary within 60 (sixty) business days since receiving the
Service Provider's invoice.
4.12. Any overdue payment shall bear interest at the twelve months LIBOR rate
as published on the 31 December of the preceding year plus 4.5% per
annum, such interest starting to accrue on the 61st (sixty first) day
following the date of receipt of the invoice.
4.13. The Service Provider shall keep true and accurate books of accounts and
records relating to its costs and expenses. Based on these records and
the books of account of the Service Provider, the Service Provider
shall prepare and submit to the Beneficiary invoices on the Service(s)
rendered for each assignment, indicating the categories of Services
rendered thereunder.
4.14. The Beneficiary shall obtain official receipts for any taxes paid on
behalf of the Service Provider and/or the latter's subcontractors
and/or their personnel in the Beneficiary's state and provide such
receipts to the Service Provider. Also,
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the Beneficiary shall obtain any official statement and/or certificate
according to the tax regulations applicable in its own state and make
them available to the Service Provider taking into consideration for
these purposes the domestic requirements provided for in the tax law
applicable in the Service Provider's state, according to the
information diligently provided in this respect by the Service
Provider.
4.15. The Beneficiary shall be entitled to obtain and shall keep appropriate
records and documentation of the Services rendered by the Service
Provider and Tasks completed by subcontractors. Such records should
enable the Beneficiary to examine and verify invoices issued by the
Service Provider.
4.16. None of the Services rendered hereunder are covered by any warranty,
provided that they are not accessory to any license, assignment of
copyright or any other kind or agreement and are not required by the
Romanian law or by the commercial practice in use for this specific
type of Service Agreements to be subject to specific representations or
warranties. Notwithstanding the above, the Service Provider warrants
that the Personnel have the requisite education, training and skills
necessary to perform the Tasks hereunder in a professional manner.
5. NON-COMPETITION
Throughout the term of this Agreement, neither the Service Provider nor
the Personnel assigned hereunder to the Beneficiary shall not, directly
or indirectly, render Services as defined hereunder to a competitor of
the Beneficiary and the Beneficiary's customer in Romania, without the
prior written approval of the Beneficiary.
6. PERMITS AND APPROVALS
6.1. All the Romanian regulations regarding work permits and/or any other
approvals, authorizations and/or notifications which are required to be
obtained and/or submitted in Romania shall be observed by the
Beneficiary's customer who shall duly inform the Service Provider, in
due time, about all information and/or documents to be made available
by the Service Provider and/or the Personnel for the purposes of
observing such regulations. The obligation to notify the Service
Provider in due time about the documents and/or the information
referred to above shall be due no later than the 10th (tenth) day from
the approval of the Staffing Authorization Form.
6.2. The Beneficiary's customer shall assist the Personnel throughout the
procedures undertaken in order to obtain the work permits and/or any
other approvals and/or authorizations whatsoever required by the
Romanian regulations, to be obtained by the foreign personnel.
6.3. The Beneficiary's customer shall keep the Service Provider harmless in
case of any delay caused by the Beneficiary's customer failure to
notify the
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Service Provider in due time about the notification referred to under
Section 6.1 above. The Service Provider and the Personnel shall be
exonerated from any liability arising from any delay incurred in the
Work Schedule agreed upon by Personnel, the Service Provider and the
Beneficiary's customer, caused by the failure to notify the Service
Provider as well as by the failure or by the inappropriate assistance
with the obtaining of any work permits and/or other approvals and/or
authorizations whatsoever.
6.4. The Beneficiary undertakes to insert a substantially similar Section in
the agreement to be concluded between the Beneficiary and the
Beneficiary's customer customer.
7. CONFIDENTIALITY
7.1. Either Party shall keep all information held on the basis of this
Agreement confidential. Either Party shall not disclose or disseminate
the same to any third party without the other Party's prior written
approval.
7.2. The obligations of this Section shall survive the termination or
cancellation of this Agreement for any cause, for a period of 5 (five)
years from the termination or cancellation hereof.
7.3. The obligations of this Section shall not apply to the information that
either Party can demonstrate:
- is wholly independently developed by the Party demonstrating this; or
- is known or that becomes known to the general public without breach of
this Agreement by the demonstrating Party; or
- was known to the demonstrating Party without confidential limitation at
the time of disclosure by the other Party hereto as evidenced by
documentation in the demonstrating Party's possession; or
- is approved for release by written authorisation of the other Party,
but only to the extent of and subject to such conditions as may be
imposed in such written authorisation; or
- is disclosed in response to a valid order to a court, regulatory
agents, or other governmental body in the Territory or any political
subdivision thereof, but only to the extent and for the purposes stated
in such order; provided, however, that demonstrating Party shall first
notify the other Party in writing of the order and cooperate with the
other Party if the other Party desires to seek an appropriate
protective order; or
- is received rightfully and without confidential limitation by the
demonstrating Party from a third party.
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7.4. Notwithstanding anything to the contrary under this Agreement, the
Beneficiary and/ or the Beneficiary's customer are/is not granted with
the right to use any know-how belonging to the Service Provider and
which shall not be disclosed to the Beneficiary and/or to the latter
customer provided that all the Services and Tasks hereunder are
directly and exclusively rendered by the Service Provider and/or by the
Personnel hired by the latter and do not imply any training of the
Beneficiary's staff and/or the latter customer.
8. ASSIGNMENTS AND SUCCESSORS
This Agreement may not be assigned by the Parties hereto, unless
provided otherwise in the Agreement or approved in writing by the other
Party hereto. This Agreement shall be binding on and inure to the
benefit of the Parties hereto and their successors.
9. FORCE MAJEURE
9.1. In the event that any of the Parties hereto shall be unable to perform
any of its obligations hereunder, any of the Parties hereto shall be
under no liability to the other Party in respect of anything which may
constitute breach of this Agreement arising by reason of force majeure,
namely, circumstances beyond the control of the Party concerned, which
shall include (but shall not be limited to) acts of God, perils of the
sea or air, fire, flood, drought, explosion, sabotage, embargo, riot,
civil commotion, including acts of local government and parliamentary
authority; disputes of whatever nature and for whatever cause arising
including (but without prejudice to the generality of the foregoing)
overtime bars, strikes and lockouts and whether between either of all
of its employees and/or between any two or more groups of employees
(and whether of either of the Parties hereto or any other employer) (a
"Force Majeure Event").
9.2. The Party who has been so affected shall immediately give notice to the
other Party and shall do everything possible to resume performance.
Upon receipt of such notice by the other Party, all obligations under
this Agreement shall be immediately suspended. If the period of
non-performance exceeds [thirty (30) calendar days] from the receipt of
notice regarding the Force Majeure Event, the Party whose ability to
perform has not been so affected may terminate this Agreement by giving
written notice to the other Party, the termination operating by effect
of law, not being necessary to follow any legal proceeding.
10. DURATION AND TERMINATION
10.1. This Agreement is concluded for an unlimited period of time.
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10.2. This Agreement may be terminated by either Party upon 5 (five) working
days prior written notice with immediate effect to the other, without
any other formality, no Court intervention being required, in the event
of any of the following: (i) admitted insolvency, (ii) institution of
voluntary or judicial proceedings in bankruptcy, insolvency, moratorium
or for a receivership, or for a winding-up or for the dissolution of
the other Party. Notwithstanding the above, the Service Provider cannot
terminate this Agreement, based on this Section, if the non-payment by
the Beneficiary is justified by the Service Provider's failure to
perform the Services as described under this Agreement.
10.3. This agreement may be terminated by either Party upon 3 (three) months
prior written notice, without any prior formality and no Court
intervention being required.
10.4 Each Party has the right to terminate this Agreement if the other Party
materially breaches or is in default of any obligation hereunder which
default is incapable of cure, or which, being capable of cure, has not
been cured within [thirty (30) calendar days] after receipt of written
notice of such default (or such additional cure period as the
non-defaulting Party may authorize). The Parties shall cooperate in
curing any such breach within this time period. The non-breaching Party
shall send a termination notice to the other Party. The termination
shall occur by effect of law, upon sending the termination notice, not
being necessary to follow any legal proceeding.
10.5. Upon termination of this Agreement, (i) all indebtedness of the
Beneficiary to the Service Provider shall become immediately due and
payable, (ii) the Service Provider shall immediately return to the
Beneficiary's customer all the strategies and business plans and any
other information being in a material form provided by the
Beneficiary's customer or its affiliated companies and being in the
possession of the Service Provider; and (iii) all other outstanding and
unfulfilled obligations or liabilities prior to the termination shall
be completely fulfilled by the termination of this Agreement.
11. HEADINGS
The headings of the Sections hereof are inserted for convenience of
reference only and are not intended to be part of or to affect the
meaning or interpretation of any of these terms and conditions of this
Agreement.
12. SEVERABILITY
In the event that any of these terms, conditions or provisions shall be
determined invalid, unlawful or unenforceable to any extent such term,
condition, or provision shall be severed from the remaining terms,
conditions and provisions which shall continue to be valid to the
fullest extent permitted by law.
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13. NOTICES
Any notice to be given by either Party to the other may be sent by
recorded delivery to the address of the other Party as appearing herein
or such other address as such Party may from time to time have
communicated to the other in writing.
14. GOVERNING LAW AND DISPUTES RESOLUTION
14.1. This Agreement shall be governed by and interpreted and construed in
accordance with the laws of the Netherlands.
14.2. The Parties shall attempt to resolve any dispute under this Agreement
amicably by mutual agreement. Any such dispute which cannot be resolved
in accordance with the Rules of Conciliation and Arbitration of the
London Court of International Arbitration, which rules are deemed to be
incorporated by reference into this section. The tribunal shall consist
of one arbitrator who shall, in the absence of agreement of the
Parties, be appointed by the London Court of International Arbitration.
The place of arbitration shall be London. The language of the
arbitration shall be in English. The tribunal shall give a written
record of the award and reasons therefor.
15. LANGUAGE OF THIS AGREEMENT
This Agreement has been executed in the English language.
This Agreement has been duly signed and approved by the Parties, today,
..................., in 2 original copies, one for each Party hereto; each of the
copies shall be deemed an original and all of which shall constitute one and the
same instrument.
For The Service Provider,
_____________________
Xxxxx Xxxxxx, Director
For The Beneficiary,
______________________
Xxxx Xxx Xxxxxxxxxx, Director
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APPENDIX A
SERVICE REQUEST
TO: ___________________ (The Service Provider)
Attn: [Director Human Resources]
Address
Tel.:
Fax:
FROM: ______________ (The Beneficiary)
Address:
Tel.:
Fax:
RE: SERVICES REQUESTED
In accordance with the Service Agreement dated as of _____________, concluded
between the Beneficiary and the Service Provider (the "AGREEMENT"), the
Beneficiary hereby requests that the Service Provider provides personnel to the
project identified as the Beneficiary's customer mobile telephony operations
upon further receipt of Staffing Authorization Form(s) for the following
personnel assignment(s). This Service Request shall be governed by the terms and
conditions of the Agreement.
PROJECT DESCRIPTION:
PROJECT LOCATION:
PROJECT DURATION:
PROJECT CONTACT:
ANTICIPATED PERSONNEL REQUIRED:
By: ________________________________
Name:_______________________________
Title: Personnel Director of _______
Dated ___________________________
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APPENDIX B
STAFFING AUTHORIZATION FORM
FROM: __________ (The Service Provider)
Attn: Director of Human Resources
Address
Tel.:
Fax:
TO: ______________ (The Beneficiary)
Address
Tel.:
Fax:
RE: Staffing Authorization
In accordance with the Service Agreement dated as of ____________,
concluded between the Beneficiary and the Service Provider (the
"AGREEMENT"), the Beneficiary has requested that the Service Provider
provides personnel to work on the Beneficiary's customer mobile
telephony operations. This Staffing Authorization Form shall be
governed by the terms and conditions of the Agreement.
NAME:
PROJECT(s):
POSITION:
REQUIRED REPORT BY DATE
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