EXHIBIT 10.51
CAPACITY SALES AGREEMENT
This Agreement is made and entered into this 23rd day of February, 1999
between MFS CABLECO (BERMUDA) LIMITED, a Bermuda company and affiliate
of WorldCom Technologies, Inc., having its registered office at
Xxxxxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxx, HMCX 12, Bermuda
("Cableco"), and EXODUS COMMUNICATIONS, INC., a Delaware corporation
located at 0000 Xxxxxxx Xxxxxxx Xxxxxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx
00000 ("Customer").
R E C I T A L S:
A. Cableco has an ownership interest in capacity on the
transatlantic fiber optic submarine and terrestrial cable network owned
and operated by Gemini Submarine Cable System Limited ("Gemini") which
runs between London, England and New York, New York, and which consists
of the Backhaul and the Gemini System (as such terms are hereinafter
defined) (the "Gemini Network").
B. Customer desires to purchase from Cableco, and Cableco is willing
to grant to Customer, an indefeasible right of use ("IRU") in a unit
of capacity equal to STM-1 (the "Capacity") on all or a segment of the
Gemini Network for the System Lifetime (as hereafter defined).
C. Cableco and Customer (hereinafter referred to as the "Parties",
and each as a "Party") desire to enter into this Agreement to set
forth the terms and conditions under which the IRU in the Capacity will
be granted to Customer.
NOW, THEREFORE, in consideration of the mutual covenants expressed
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties covenant and
agree with each other as follows:
1. Definitions. Unless otherwise defined in this Agreement, the
following capitalized terms used in this Agreement shall have the
applicable meaning set forth below and in Schedule 1 attached hereto
and incorporated by reference herein. To the extent that any
definition set forth in this Agreement for any capitalized term is
different from the definition for such term set forth in the C&MA, the
definition set forth in this Agreement shall apply.
1.1 "Agreement" means this agreement together with the Schedule(s)
specifically referenced herein and attached hereto.
1.2 "Backhaul" means, the indefeasible right of use granted by a
Backhaul Provider to Gemini for capacity in all that plant and
equipment and all those facilities required to connect a US or UK
System Interface Point (excluding such System Interface Point) to its
respective Backhaul Interface Point (including such Backhaul Interface
Point). The US and UK Backhauls shall comprise the following:
1.2.1 US BACKHAUL
"US Backhaul" means the indefeasible right of use granted by the US
Backhaul Provider to Gemini for capacity in all that plant and
equipment and all those facilities necessary to provide redundant,
protected two-way digital communications between and from the US System
Interface Points (excluding such System Interface Points) to the US
Backhaul Interface Points (and shall include such US Backhaul Interface
Points).
1.2.2 UK BACKHAUL
"UK Backhaul" means the indefeasible right of use granted by the UK
Backhaul Provider to Gemini for capacity in all that plant and
equipment and all those facilities necessary to provide redundant,
protected two-way digital communications between and from the UK System
Interface Points (excluding such System Interface Points) to the UK
Backhaul Interface Points (including such Backhaul Interface Points).
1.3 BACKHAUL INTERFACE POINT
"Backhaul Interface Point" means a point at which a Carrier User
may interconnect with the Backhaul to access the Gemini Network.
1.4 BACKHAUL PROVIDER
"Backhaul Provider" means collectively, the US Backhaul Provider
and the UK Backhaul Provider.
1.5 "IC&MA" means the Construction, Operation and Maintenance
Agreement dated October 8, 1998, herewith and attached hereto as
Schedule 1, as may be amended from time to time in accordance with its
terms.
1.6 "FCC" means the United States Federal Communications Commission.
1.7 "Gemini System" means all plant and equipment between and
including the System Interface Points consisting of two transatlantic
fiber optic systems between the US and UK (each consisting of two
optical fiber pairs), interconnected at each end by an lntedink between
the Cable Station at such end, all of which will be operated in a
redundant loop configuration. Gemini System will constitute a part of
the Gemini Network (as defined on Schedule 1).
1.8 "Granting Date" means the date upon which Customer shall
have both
received notice from Cableco of Capacity availability in accordance
with Subsection 2.3; and (ii) paid Cableco the Granting Price (as
hereafter defined) in full.
1.9 "Hand-off Points" means the points between which the
Capacity shall be provided. More particularly these are the STM-1
electrical interfaces on the Gemini add drop mulitplexer forming part
of the Gemini digital distribution frame located at 00 Xxxxxx Xxxxxx,
Xxx Xxxx Xxxx, XX, XX and at Xxxxxxxxx Xxxxxx, Xxxxxx, XX.
1.10 "IRU" means the "indefeasible right of use" of a unit of
capacity on the Gemini Network (or portion thereof for the System
lifetime.
1.11 "Network Ready for Customer Service Date" or "RFCS Date"
means the date on which the first portion of the Gemini Network (i.e.,
the southern submarine cable route linking Porthcurno, United Kingdom
to Manasquan, New Jersey, together with associated Backhaul system
linking Porthcurno and London in the UK and Manasquan, New Jersey and
New York, New York in the US) is ready for the provision of commercial
services from London, England to New York, New York, as certified by
Gemini, being 28 February 1998.
1.12 "Network Ready for Service Date" of "RFS Date" means the
date on which the complete Gemini Network (including all associated
Backhaul systems) is ready for the provision of commercial services
from London, England to New York, New York, as certified by Gemini.
1.13 "Restoration Charges" means the charges payable by
Customer to Cableco to restore the Capacity on another cable system.
1.14 "STM-1" means a l55.22OMbps/sec both way digital line
section passing between two System Interface Points, together with the
interconnection interfaces pertaining thereto, in accordance with ITU-
TS recommendations.
1.15 "System Interface Points" means a point at which the
Gemini System may be interconnected with the Backhaul or the networks
of a Carrier User or other backhaul provider and shall be located at
digital distribution frame, or equivalent equipment, associated with
the Gemini System at a Cable Station.
1.16 "System Lifetime" means the lifetime of the Gemini Network
from the RFCS Date until the Gemini Network is retired in accordance
with this C&MA.
2. Grant of IRU.
2.1 In consideration for the payment by Customer to Cableco of
the Granting Price and the O&M Costs, Cableco grants to Customer
effective as of the Granting Date an IRU in the Capacity, subject to
the terms and conditions set forth in this Agreement.
2.2 The Capacity shall be provided between the Hand-off Points,
and shall be presented to Customer via WorldCom leased access circuits
as set forth below. The provision of the aforementioned leased
circuits from the Hand-off Points to Customer's premises by Cableco
shall be subject to WorldCom Technologies, Inc.'s standard terms and
conditions as set forth in the WorldCom Capacity Access Service
Agreement, copy of which is attached hereto as Schedule 2.
2.3 Cableco shall use commercially reasonable efforts to make
the Capacity available to Customer by March 31, 1999 (the "Capacity
Request Date"). Cableco shall, upon its making the Capacity available
to Customer in accordance with this Subsection 2.3, demonstrate to the
reasonable satisfaction of Customer the performance of such Capacity
against testing criteria (to be determined in Cableco's sole
discretion) to be provided by Cableco. In the event Customer makes use
of the Capacity prior to the Capacity Request Date, it shall be deemed
to have acknowledged that availability of such Capacity and to have
delivered a notice to Cableco on such date.
2.4 Customer acknowledges that Gemini may from time to time
require use of the Capacity for the purpose of conducting tests,
adjustments and work and Customer shall make the Capacity available to
Gemini (or to its subsidiaries or agents) for such purpose, at such
times as may be necessary for such Capacity to be maintained in
efficient working order. In the event Gemini shall require access to
the Capacity as described in this Subsection 2.4, Cableco shall provide
written notice (the "Test Notice") to Customer as soon as commercially
reasonable, but in no event will the notice be less than 5 business
days. In the event that delivery of the Test Notice is not
commercially reasonable, Cableco shall contact Customer by telephone at
such location as Customer may from time to time notify Cableco in
writing immediately prior to the commencement of any such tests,
adjustments or work. All such tests, adjustments or work shall be
performed at such times and in such manner as shall minimize or prevent
any interruption in or interference with the Capacity.
2.5 The communications capability and efficiency of any
Capacity may be optimized by Customer by the use of equipment, provided
that the use and operation of such equipment by Customer or any person
or entity claiming through or under Customer shall not (i) cause any
interruption of, or interference to, the use of any other capacity on
the Gemini Network, (ii) prevent the use of similar equipment by other
owners or operators of the Gemini Network, (iii) impair privacy of any
communications over such facilities, (iv) cause damage to any plant or
equipment, or (v) create hazards to employees, affiliates or connecting
companies of Cableco, Customer, or any other user, owner or operator of
the Gemini Network or the public; and provided, further, that Customer
shall indemnify Cableco in connection with the use of any such
equipment by Customer or any person or entity claiming through or under
Customer in accordance with the provisions of Subsection 2.5. Such
equipment, if used, shall not constitute a part of the Gemini Network.
In addition, Customer shall bear the cost of any additional protective
apparatus reasonably required to be installed because of the use of
such facilities by Customer, any lessees of Customer, or any customer
or customers of Customer or of any such lessee. Customer shall, in any
agreements with third parties for the sale of any interests in the
Capacity, include in such agreements provisions substantially in the
form of those contained in this Subsection 2.5.
3. Payment for IRU.
3.1 In consideration for the grant to Customer of an IRU in the
Capacity,
Customer shall pay to Cableco *** (the "Granting Price"). The
Granting
Price shall be payable as follows:
(i) Fifty percent (50%) payable within thirty (30) days
following execution of this Agreement;
(ii) With the remaining fifty percent (50%) payable within
thirty (30) days following the date on which Cableco notifies Customer
that the Capacity is available to Customer.
3.2 In addition to the Granting Price described in Subsection
3.1 above, Customer shall be liable for those costs reasonably incurred
by or on behalf or Gemini in connection with the operation, maintenance
and repair of the Gemini Network as described in more detail in the
C&MA (the "O&M Costs"). The O&M costs consist of ***. The Annual
Charge shall be due on the Granting Date and the anniversary of each
date thereafter. The Restoration Charge shall be due within thirty
(30) days following receipt of a Cableco invoice for any restoration
incident.
3.3 All payments made by Customer under this Agreement shall be
made without any deduction or withholding for or on account of any tax,
duty or other charges of whatever nature imposed by any taxing or
governmental authority (collectively, "Taxes"). If Customer is
required by law to make any deduction or withholding from any payment
due hereunder to Cableco then, notwithstanding anything to the contrary
contained in this Agreement, the gross amount payable by Customer to
Cableco will be increased so that, after any such deduction or
withholding for Taxes, the net amount received by Cableco will not be
less than Cableco would have received had no such deduction or
withholding been required. Customer acknowledges and understands that
Cableco computes all charges herein exclusive of any applicable
foreign, VAT, federal, state or local use, excise, gross receipts,
sales and privilege taxes, duties, fees or similar liabilities (other
than general income or property taxes), whether charged to or against
Cableco or Customer because of the Service furnished to Customer
("Additional Charges"). Customer shall pay such Additional Charges in
addition to all other charges provided for herein.
3.4 If payment is not received by Cableco on or before the
applicable due date, Customer shall, on five (5) business days' notice
from Cableco, also pay a late fee in the amount of the lesser of one
and one-half percent (1 1/2%) of the unpaid balance of the applicable
charge, or, the maximum lawful rate under applicable state law.
3.5 Cableco shall render invoices under this Agreement in U.S.
dollars, and Customer shall pay the amounts due in U.S. dollars.
Customer shall make said payments to Cableco in immediately available
funds.
***Confidential treatment has been requested for certain portions of
this document. Such omitted portions have been filed separately with
the Securities and Exchange Commission.
3.6 Invoices shall be deemed to have been accepted by Customer if it
does not present a written objection to Cableco on or before the date
when payment is due. If such objection is made, Customer shall pay the
undisputed portion of such invoice and the Parties shall make all
reasonable efforts to resolve such dispute promptly.
4. Operation and Maintenance.
4.1 Cableco shall furnish the Capacity to Customer and maintain
the Capacity in accordance with the terms of the C&MA.
4.2 In the event that the Capacity and any in-system
restoration shall become unavailable during the System Lifetime and
restoration facilities are available to Gemini on another cable system,
Gemini shall arrange restoration of the Capacity and Customer shall pay
the Restoration Charges therefor. In the event Customer notifies
Cableco in writing that it shall not require restoration of the
Capacity, Cableco shall not be obliged to procure the restoration of
the Capacity and Customer shall not be liable for payment of the
Restoration Charges therefor.
5. Representations, Warranties and Covenants.
5.1 Customer hereby represents to, warrants and covenants with
Cableco as
follows:
(a) Customer is a Delaware corporation, duly organized
and validly existing under the laws of its state or jurisdiction of
organization and has the requisite authority to execute this Agreement
and to perform its obligations hereunder.
(b) This Agreement constitutes a valid and binding
obligation of Customer, enforceable against Customer in accordance with
its terms.
(c) There are not pending, or, to Customer's knowledge,
any threatened claims, actions, suits, audits, investigations or
proceedings by or against Customer which could have a material adverse
effect on Customer's ability to perform its obligations under this
Agreement.
(d) To the best of Customer's present knowledge, Customer
has obtained and shall maintain in good standing, all such consents,
approvals, licenses, permits and other approvals, both governmental and
private, as may be required, at the time of performance, to permit
Customer to perform its obligations under this Agreement and to acquire
and use the Capacity. In the event Customer learns of any such
consents, approvals, licenses, permits or other approvals, governmental
or private, as may be required, Customer shall obtain and thereafter
shall maintain in good standing, all such consents, approvals,
licenses, permits and other approvals, both governmental and private,
as may be required, at the time of performance, to permit Customer to
perform its obligations under this Agreement and to acquire and use the
Capacity.
(e) Customer is a "Carrier User" within the meaning of
that term as it is used in the C&MA.
(f) Customer shall perform its obligations under this
Agreement and use the Capacity in a manner consistent with applicable
law, and shall not use, or permit the Capacity to be used, for any
illegal purpose or in any other unlawful manner.
(g) Customer shall not create or permit to exist, any
liens, encumbrances or charges to be placed upon the Capacity or
Customer's rights under this Agreement other than liens, encumbrances
or charges of financial institutions or others against Customer's
assets generally in connection with financing arrangements by Customer.
(h) Customer shall use the Capacity and shall cause all
other persons using the Capacity to use the Capacity in such a manner
so as not to cause any interruption of, or interference to, the Gemini
Network, or the use of any other capacity on the Gemini Network.
5.2 Cableco hereby represents to, warrants and covenants with
Customer as
follows:
(a) Cableco is a Bermuda company, duly organized and
validly existing under the laws of Bermuda and has the requisite
authority to execute this Agreement and to perform its obligations
hereunder.
(b) This Agreement constitutes a valid and binding
obligation of Cableco, enforceable against Cableco in accordance with
its terms.
(c) There are no pending, or, to Cableco's knowledge,
threatened claims, actions, suits, audits, investigations or
proceedings by or against Cableco which could have a material adverse
affect on Cableco's ability to perform its obligations under this
Agreement.
(d) Cableco has obtained or shall obtain and shall
maintain in good standing, all necessary consents, approvals, licenses,
permits and other approvals, both governmental and private, as are
necessary to permit Cableco to perform its obligations under this
Agreement.
(e) Cableco shall not create or permit to exist, any
liens, encumbrances or charges to be placed upon the Capacity or
Cableco's rights under this Agreement other than liens, encumbrances or
charges of financial institutions or others against Cableco's assets
generally in connection with financing arrangements by Cableco.
(f) Cableco shall perform its obligations under this
Agreement in a manner consistent with applicable law.
6. Default.
6.1 In the event Customer (i) fails to make any payment under
this Agreement when due, (ii) fails to perform any of its material
obligations under this Agreement, or (iii) is otherwise in breach of
any material representation, warranty, covenant or other obligation
under this Agreement, which event remains uncured for a period of
thirty (30) days following receipt by Customer of written notice of any
such breach or failure, Cableco shall be entitled upon ten (10)
business days' written notice to Customer to terminate this Agreement
and to reclaim the IRU granted hereunder, and shall be relieved of any
liability to Customer due to such termination and reclamation.
6.2 In the event Cableco (i) fails to perform any of its
material obligations under this Agreement, or (ii) is otherwise in
breach of any material representation, warranty, covenant or other
obligation under this Agreement, which event remains uncured for a
period of thirty (30) days following receipt by Cableco or written
notice of any such breach or failure, Customer shall be entitled, upon
ten (10) business days' written notice to Cableco to terminate this
Agreement and shall be relieved of any liability to Cableco due to such
termination. In the event Customer terminates this Agreement in
accordance with this Subsection 6.2, Cableco shall be entitled to
reclaim the IRU granted hereunder and, if Cableco so reclaims the IRU
granted hereunder, Cableco shall make payment to Customer of a
proportion of the Granting Price appropriately pro rated according to
the following schedule:
Termination Date Portion of Granting Price to Be
Reimbursed
0-1 year after Granting Date ***
1-2 years after Granting Date ***
2-3 years after Granting Date ***
3-4 years after Granting Date ***
4-5 years after Granting Date ***
5+ years after Granting Date ***
In addition, in the event Cableco reclaims the IRU in accordance
with this Subsection 6.2, Cableco shall refund Customer an amount equal
to the product of the O&M Costs paid by Customer at the beginning of
the year of such termination, multiplied by the number of months
remaining in the contract year (measured from the anniversary of the
Granting Date), divided by twelve (12).
6.3 Either Party shall be entitled to terminate this Agreement
by written notice to the other Party in the event that the other Party
shall be dissolved or go into liquidation (other than for the purposes
of reconstruction or amalgamation), bankruptcy or insolvency, including
(i) the filing of a voluntary or involuntary petition seeking
liquidation, reorganization, arrangement or a readjustment in any form,
of its debts under any federal or state bankruptcy insolvency or
similar law with involuntary petitions not canceled or withdrawn with
forty-five (45) days' of filing thereof; of (ii) the making of any
assignment for the benefit of its creditors.
***Confidential treatment has been requested for certain portions of
this document. Such omitted portions have been filed separately with
the Securities and Exchange Commission.
6.4 This Agreement shall terminate in the event of: (i) any final
action by the FCC or other applicable regulatory or governmental
authority directing either Party or Gemini to terminate this Agreement
or declaring that this Agreement is in any way inconsistent with FCC
rules or other applicable laws, rules and regulations, or (ii) upon the
expiration or earlier revocation of any license granted to either Party
by a regulatory or governmental authority and required by such Party to
authorize its use of the Gemini Network in accordance with the terms of
this Agreement. ***
6.5 The exercise by either Party of its rights under this
Section 6 shall be without prejudice to any and all rights and legal
and equitable remedies which such Party may have under this Agreement
or otherwise (including its rights and remedies to enforce the other
Party's obligations under this Agreement).
7. Limited Liability; General Indemnity; Reimbursement.
7.1 IN NO EVENT SHALL EITHER PARTY HERETO OR ITS AFFILIATES BE
LIABLE TO THE OTHER PARTY (OR ANY PERSON OR ENTITY CLAIMING THROUGH OR
UNDER SUCH PARTY, DIRECTLY OR INDIRECTLY) FOR ANY INDIRECT, SPECIAL,
INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES, INCLUDING WITHOUT
LIMITATION, LOSS OF REVENUE, LOSS OF CUSTOMERS OR CLIENTS, LOSS OF
GOODWILL OR LOSS OF PROFITS ARISING IN ANY MANNER FROM THIS AGREEMENT
AND THE PERFORMANCE OR NONPERFORMANCE OF OBLIGATIONS HEREUNDER,
INCLUDING WITHOUT LIMITATION, ANY DAMAGE SUSTAINED BY REASON OF ANY
DELAY IN COMMENCING, OR ANY FAILURE IN OR BREAKDOWN OF THE GEMINI
NETWORK OR ANY FACILITIES ASSOCIATED WITH THE GEMINI NETWORK, OR FOR
ANY INTERRUPTION OF SERVICE WHATSOEVER, EVEN IF SUCH PARTY OR ITS
AGENTS WERE AWARE OF THE POSSIBILITY OF SUCH LOSSES.
7.2 In the event parties other than Customer (e.g., Customer's
affiliates and/or Customer's end users) shall have use of the Service
through Customer, then Customer agrees to forever indemnify and hold
Cableco and its affiliated companies harmless from and against any and
all claims, demands, suits, actions, losses, damages, assessments or
payments which those parties may assert arising out of or relating to
any defect in the Service.
7.3 The Parties agree to reimburse the other Party for all
reasonable costs and expenses incurred by the other party due to such
Party's direct participation (either as a party or witness) in any
administrative, regulatory or criminal proceeding concerning the other
party if such Party's involvement in said proceeding is based solely on
any issue or provision of Services arising out of this Agreement.
***Confidential treatment has been requested for certain portions of
this document. Such omitted portions have been filed separately with
the Securities and Exchange Commission.
8. Force Majeure. Except as otherwise specifically provided for in
this Agreement, Cableco's performance shall be excused and it shall not
be liable to Customer or any other person, firm or entity for any
failure of performance hereunder if such failure is due to any cause or
causes beyond the reasonable control of Cableco. Such causes shall
include, without limitation, acts of God, fire, explosion, vandalism,
cable cut, storm or other similar occurrence, any law, order,
regulation, direction, action or request of the United States
government or of any other government or of any civil or military
authority, national emergencies, insurrections, dots, wars, strikes,
lockouts or work stoppages or other labor difficulties, supplier
failures, shortages, breaches or delays.
9. Relationship of Parties. The relationship of the Parties hereto
shall not be that of partners and shall be limited to the express
provisions of this Agreement. Nothing herein contained shall be deemed
to constitute a partnership between them or to merge their assets or
their fiscal or other liabilities or undertakings, nor shall it allow a
Party to act as an agent of the other party.
10. Severability. It any provision of this Agreement is found by an
appropriate judicial or regulatory authority to be void or
unenforceable, such provision shall be deemed to be deleted from this
Agreement and the remaining provisions shall continue in full force and
effect.
11. Headings; References. Headings are inserted for convenience only
and shall
not affect the interpretation of this Agreement. References to
Sections, Subsections and Schedules are to references to Sections,
Subsections and Schedules to this Agreement. Unless the context
otherwise requires, words importing the singular number shall include
the plural and vice versa. Unless the context otherwise requires,
references to a person include an individual, firm, body, corporation,
unincorporated association and government or governmental, semi-
governmental or local authority or agency.
12. Assignment. Customer shall not assign or transfer its rights or
obligations under this Agreement without the prior written consent of
Cableco. Any assignment or transfer without such consent shall be
void.
13. Increase or Decrease in Design Capacity.
13.1 Customer acknowledges that Gemini may increase, at its own
cost and expense, the initial design capacity of the Gemini Network.
13.2 Customer acknowledges that in the event the capacity that
the Gemini Network is capable of providing at the RFS Date is less than
the aggregate amount of capacity purchased by all purchasers of
capacity on the Gemini Network, or in the event the capacity that the
Gemini Network is capable of providing is reduced below the aggregate
level of capacity purchased by all carrier users at any time during the
System Lifetime for any cause outside Gemini's reasonable control, the
available capacity shall be assigned to all purchasers of capacity on
the Gemini Network in proportion to their respective shares of the
purchased capacity. In case of such capacity reduction the O&M Costs
payable by each Customer shall be recomputed. In such event, Customer
shall have the right to terminate this Agreement on not less than one
hundred eighty (180) days notice to Cableco, unless Cableco is able to
restore full Capacity to Customer within that one hundred eighty day
(180) period.
14. Continuation of Obligations.
14.1 Upon any termination of this Agreement in accordance with
Section 6, the rights and obligations of Customer in the IRU granted to
it hereunder shall terminate in accordance with the terms of this
Agreement.
14.2 Termination of this Agreement shall not operate as a waiver
by either Party of any breach of the provisions hereof and shall be
without prejudice to the rights or remedies of either Party which may
arise as a consequ6nce of such breach or which may have accrued
hereunder up to the date of such termination.
15. Governing Law and Arbitration. This Agreement shall be construed
under the laws of the State of New York without regard to choice of law
principles,
Any dispute relating to this Agreement or its subject matter -
including disputes as to validity, performance, breach, or termination
-- which cannot be settled by negotiation, shall be submitted to
binding arbitration in accordance with the Arbitration Rules of the
United Nations Commission on International Trade Law ("UNCITRAL
Rules") as in force on the date of commencement of arbitration, and as
modified by this Arbitration Clause. Claims alleging violations of the
telecommunications laws of the United States of America, however, shall
be brought solely before the United States Federal Communications
Commission.
ADR Associates shall serve as both the appointing authority and
the administering body under the UNCITRAL Rules. ADR Associates shall
appoint a single arbitrator of a nationality other than the
nationalities of the parties. All arbitration proceedings shall be
conducted in English. The place of arbitration shall be Bermuda.
Neither the parties, nor the arbitrator, nor ADR Associates shall
disclose the existence, content, or results of any arbitration except
with the prior written consent of both parties. The law governing the
arbitration proceedings shall be the Bermuda International Conciliation
and Arbitration Xxx 0000.
The arbitrator shall abide by the rules of Ethics for
International Arbitrators established by the International Bar
Association. The arbitrators authority to grant relief is subject to
the terms of this Arbitration Clause, the terms of the Agreement, and
the law governing the Agreement. The arbitrator shall have no
authority to award exemplary, punitive, or treble damages.
Each party shall pay one half the costs of the arbitration (as
defined in Article 38, UNCITRAL Rules), except that each party shall
pay the expenses it incurs for its own legal representation and
assistance. Judgment on the award may be entered in any court of
competent jurisdiction. The post-award proceedings shall be governed
by the Convention on Recognition and Enforcement of Foreign Arbitral
Awards of 1958 (the "New York Convention"). The validity and
construction of this Arbitration Clause shall be governed by the law of
the State of New York, U.S.A., without regard to its conflict of laws
rules.
16. Successors and Assigns. This Agreement and all the provisions
hereof shall be binding upon and insure to the benefit of the Parties
hereto and their respective successors and permitted assigns.
17. Waiver. The waiver by any Party, in whole or in part, of a
breach of or a default under any of the provisions of the Agreement, or
the failure, in whole or in part, of any Party, upon one or more
occasions, to enforce any of the provisions of this Agreement or to
exercise any right or privilege hereunder shall not thereafter be
construed as a waiver of any subsequent breach or default of a similar
nature or as a waiver or any such provision, right or privilege
hereunder.
18. Counterparts. This Agreement may be executed in counterparts,
each of which when executed and delivered shall be deemed an original.
Such counterparts shall together (as well as separately) constitute one
and the same instrument.
19. Notices. Notices under this Agreement shall be in writing and
delivered to the person identified below at the offices of the parties
as they appear below or as otherwise provided for by proper notice
hereunder. Notices under this Agreement shall be transmitted via
facsimile, overnight courier, hand delivery or certified or registered
mail, postage prepaid and return receipt requested. Customer shall
notify Cableco in writing if Customers billing address is different
than the address shown below. The effective date for any notice under
this Agreement shall be the date of actual receipt of such notice by
the appropriate party, notwithstanding the date of mailing.
If to Cableco: MCI WorldCom
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxx 0, 0xx Xxxxx
Xxxxxxx, XX 00000
Fax: 000-000-0000
Attn: Marketing, Contract Administration
If to Customer: Exodus Communications, Inc.
0000 Xxxxxxx Xxxxxxx Xxxx.
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Fax: 000-000-0000
Attn: VP Engineering
With Copy to: Exodus Communications, Inc.
0000 Xxxxxxx Xxxxxxx Xxxx.
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: General Counsel
20. Partial Invalidity; Government Action.
20.1 If any part of any provision of this Agreement or any other
agreement, document or writing given pursuant to or in connection with
this Agreement shall be invalid or unenforceable under applicable law,
rule or regulation, that part shall be ineffective to the extent of
such invalidity only, without in any way affecting the remaining parts
of that provision or the remaining provisions of this Agreement. In
such event, Customer and Cableco will negotiate in good faith with
respect to any such invalid or unenforceable part to the extent
necessary to render such part valid, enforceable, and capable of
accomplishing the lawful objectives and intent of the parties.
20.2 Upon thirty (30) days prior notice, either party shall have
the right, without liability to the other, to cancel an affected
portion of the Service if any material rate or term contained herein
and relevant to the affected Service is substantially changed (to the
material detriment of the terminating party) or found to be unlawful or
the relationship between the parties hereunder is found to be unlawful
by order of the highest court of competent jurisdiction to which the
matter is appealed, the FCC, or other local, state or federal
government authority of competent jurisdiction.
21. Exclusive Remedies. Except as otherwise specifically provided
for herein, the remedies set forth in this Agreement comprise the
exclusive remedies available to either party at law or in equity.
22. Use of Service.
22.1 Under the terms and conditions of this Agreement, Cableco
will provide the Capacity specified therein to Customer upon condition
that the Capacity shall not be used for any unlawful purpose. The
provision of Capacity will not create a partnership or joint venture
between the parties or result in a joint communications service
offering to any third parties, and Cableco and Customer agree that this
Agreement, to the extent it is subject to FCC regulation, is an inter-
carrier agreement which is not subject to the filing requirements of
Section 21 1 (a) of the Communications Act of 1934 (47 U.S.C. 21 1
(a)) as implemented in 47 C.F.R. 43.51.
22.2 In consideration of the charges offered to Customer
hereunder, Customer agrees not to resell the Capacity provided
hereunder to any third party, and that any such resale shall be
considered a breach of this Agreement.
23. Rule of Construction. No rule of construction requiring
interpretation against the drafting party hereof shall apply in the
interpretation of this Agreement.
24. Confidential Information.
24.1 The Parties understand and agree that the terms and
conditions of this Agreement, all documents referenced herein
(including invoices to Customer for Service provided hereunder),
communications between the Parties regarding this Agreement or the
Service to be provided hereunder (including but not limited to price
quotes to Customer for any Service proposed to be provided or actually
provided hereunder, technical information, business or marketing plans,
and customer data), as well as such information relevant to any other
agreement between the Parties (collectively, "Confidential
Information"), are confidential as between Customer and Cableco.
However, this Agreement imposes no obligation upon the receiving party
with respect to information that (i) was in the receiving party's
possession before receipt for the disclosing party; (ii) is or becomes
a matter of public knowledge through no fault of the receiving party;
(iii) is rightfully received by the receiving party from a third party
without a duty of confidentiality; or (iv) is independently developed
by the receiving party.
24.2 A party shall not disclose Confidential Information unless
subject to discovery or disclosure pursuant to legal process, nor to
any other party other than the directors, officers, and employees of a
party or a party's agents including their respective brokers, lenders,
insurance carriers or bona fide prospective purchasers who have
specifically agreed in writing to nondisclosure of the terms and
conditions hereof. Any disclosure hereof required by legal process
shall only be made after providing the non-disclosing party with notice
thereof in advance so as to permit the non-disclosing party the
opportunity to seek an appropriate protective order or exemption.
Violation by a party or its agents of the foregoing provisions shall
entitle the non-disclosing party, at its option, to obtain immediate
injunctive relief without a showing of irreparable harm or injury and
without the necessity of bond.
24.3 The provisions of this Section 24 will be effective as of
the date of this Agreement and remain in full force and effect for a
period which will be the longer of (i) one (1) year following the date
of this Agreement, or (ii) one (1) year from the termination of all
Service hereunder.
25. Press Releases. The parties agree that any press release,
advertisement or publication generated by a Party regarding this
Agreement, the Service provided hereunder or in which a Party desires
to mention the name of the other Party or the other Party's parent or
affiliated company(ies), will be submitted to the non-publishing Party
for its written approval at least five (5) days prior to publication
unless a shorter period be mutually agreed and evidenced in writing.
No press release shall be issued regarding this Agreement without the
other party's written approval.
26. Entire Agreement. This Agreement constitutes the complete and
exclusive statement of the understandings between the parties and
supersedes all proposals and prior agreements (oral or written) between
the parties relating to the subject matter of this Agreement. No
subsequent agreement between the Parties concerning the Service shall
be effective or binding unless it is made in writing and subscribed to
by authorized representatives of Customer and Cableco.
IN WITNESS WHEREOF, the parties have executed this Capacity Sales
Agreement on the date written below.
MFS CABLECO (BERMUDA) LTD. EXODUS COMMUNICATIONS, INC,
By: /s/ Xxxxx Xxxxxx By: /s/ Xxxxx X. XxXxxxxxx
Print Name: Xxxxx Xxxxxx Print Name: Xxxxx X. XxXxxxxxx
Title: V.P. Marketing Title: EVP, Engineering
Date: Date: February 17, 1999
Schedule I
GEMINI NETWORK
CONSTRUCTION, OPERATION AND MAINTENANCE ARRANGEMENT
(C&MA)
1. DEFINITIONS
Definitions shall be as set forth in the Capacity Sales Agreement with
the following additions:
1.1 BASIC SYSTEM MODULE
"Basic System Module" of the Gemini Network means an STM-1 digital
line section with interfaced provide in accordance with the appropriate
ITU-TS Recommendations.
1.2 CABLE STATION
"Cable Station" means a building which houses Gemini System terminal
equipment at a Gemini System landing point.
1.3 CARRIER USER
"Carrier User" means any entity that is authorized or permitted, under
the laws of its respective country, to acquire and use submarine cable
telecommunications serves between or via the US and the UK, and that
acquires capacity of the Gemini Network for the provision of
international telecommunication services.
1.4 COUNTRY
"Country" means a country territory or place, as appropriates.
1.5 CSA
"CSA" means in relation to any Carrier User, the capacity sales
agreement for the grant by Gemini to such Carrier User of capacity on
the Gemini Network executed between Gemini and such Carrier User.
1.6 FOUNDING PARTY
'"Founding Party" means a shareholder of Gemini.
1.7 GEMINI
"Gemini" means the joint venture formed by the Founding Parties to
build, own (or obtain indefeasible rights of us in), operate, and
maintain the Gemini Network.. Gemini has been formed to build, operate
and maintain the Gemini Network.
1.8 GEMINI NETWORK
"Gemini Network" means the fiber optic submarine and terrestrial cable
network capable of providing telecommunications services from London,
England to New York, New York, which network consists of the Backhaul
and the Gemini System. Gemini Network is intended to provide digital
transmission services using fiber optic cable between points in or
reached via the US and point in or reached via the UK; necessary
permits, wayleaves and other authorizations in accordance with English
law are available Cable & Wireless communications limited at UKL
affiliate of Cable & Wireless PLC (hereinafter the "UK Landing Party")
to enable the Gemini Network to be installed and operated in the UK,
and necessary rights of way and permits, licenses and other
authorizations in accordance with applicable United States federal and
state law are available to MFS Cable co. (US), Inc. A Delaware
corporation, which is an US affiliate of MFS Cable Co (Bermuda) Ltd.
(hereinafter, the "US Landing Party" to enable the Gemini Network to
be installed and operated in the US;
1.9 INTERLINK
"Interlink" means the fiber optic capacity connecting the Cable
Stations at the UIS and UK ends of the Gemini Network (i.e. subsegments
S3 and S4), respectively.
1.10 ITU-TS
"ITU-TS" means the international Telecommunications Union
Telecommunications Standardization Sector (Previously referred to as
CCITT).
1.11 LANDING PARTY
"Landing Party" means an entity that contracts with Gemini to provide
the use of the permits, wayleaves, right of way and authorizations
necessary to enable the Gemini System to be installed and operated in
the US or the UK.
1.12 LANDING STATION SYSTEM MULTIPLEX EEQUIPMENT
"Landing Station System Multiplex Equipment" means any and all
equipment necessary in each of the Cable Stations required to operate
and interface at the System digital input-output ports.
1.13 O&M COSTS
"O&M Costs" means those operation, maintenance and repair costs
associated with, of the Gemini Network as described in Clause 8 hereof
1.14 O&M CONTRACT
"O&M contract" means an agreement providing for the provision of
material services, or equipment pertaining to the operation,
maintenance, or report of the Gemini Network.
1.15 TRANSIT CIRCUIT
"transit Circuit" means a circuit conveyed on the Gemini Network but
which does not terminate in one or both of the UK or US.
1.16 UK BACKHAUL PROVIDER
"UK Backhaul Provider" means Cable and Wireless Communications
Limited, a company organized under the Laws of England and Wales; or
such other person as may provide UK Backhaul services to Gemini, from
time to time.
1.17 USABLE CAPACITY
The "Usable Capacity" of the Gemini Network means the fully restorable 128
Basic System Modules of capacity available for use when the complete
Gemini Network is available for service and operated as a fully
redundant, self-restoring 20 Gigabit system.
1.18 US BACKHAUL PROVIDER
"US Backhaul Provider" means MFS Cable Co (US), Inc., a Delaware
corporation or such other person as may provide US Backhaul services to
Gemini, from time to time.
2. GEMINI NETWORK SEGMENTS AND SUBSEGMENTS
The Gemini System, as shown in Diagram 2.2 hereto, shall be provided
constructed, maintained and operated among the Cable Station in
Manaquan, New Jersey, US; Porthcurno, UK; Charlestown, Rhode island,
US; and Oxwich Bay, UK. The Gemini System shall consist of two fiber
optic pairs configured to operate in a loop configuration that will
connect Charlestown and Manasquan in the US with Porthcurno and Oxwich
Bay in the UK.
2.1 SEGMENTS
Solely for the purposes of identifying capacity utilization, Segments
A, B, C, D shall each consist of an appropriate share of land and
building at the specified locations for the cable landing and for the
cable right-of-way and ducts between the Cable Station and its
respective landing point, and an appropriate share of common services
and equipment (other than services and equipment associated solely with
the Gemini System, and other than Landing Station System Multiplex
Equipment), or indefeasible rights of use therein, at each of the
locations.
2.1.1 Segment A
A Cable Station located in Charlestown, Rhode Island, US .
2.1.2 Segment B
A Cable Station located in Manasquan, New Jersey, US.
2.1.3 Segment C
A Cable Station locate din Oxwich Bay, UK
2.1.4 Segment D
A Cable Station located in Porthcurno, UK.
2.2 Segment S
Solely for purposes of identifying capacity utilization, Segment S
shall consist of the whole of the submarine cable and Interlinks, which
shall include all submersible cable, plant, equipment and facilities,
or indefeasible rights of use therein, between and including the System
Interface Points in the US and UK. It includes, but is not limited to,
all necessary submarine and terrestrial cable, cable joints and joint
housing, repeaters, transmission equipment, power feeding equipment
(and the associated sea earth cable and electrode system and/or the
land earth system, or an appropriate share thereof), and special test
equipment directly associated with the submersible plant, and
interconnection facilitates, provided, and Including the System
Interface Points at the Cable Station at Charlestown, Rhode Island, US;
Manasquan, New Jersey, US, Oxwich Bay; UK and Porthcurno,
2.2.1
Segment A
(Charlestown)
Segment S1
Segment C
(Oxwich Bay)
Segment
S3
Segment
S4
Segment B
(Manasquan)
Segment S2
Segment D
(Porthcurno)
3. OBLIGATIONS TO PROVIDE BACKHAUL AND INTERCONNECTION FACILITIES
Gemini shall use its commercially reasonable efforts to ensure for the
System Lifetime (a) the availability of such Backhaul facilities as may
be reasonably required to utilize efficiently the Gemini System and
with inland networks at the Backhaul Interface Points, including all
necessary facilities to connect the System Interface points and
Backhaul Interface Points; and (b) the availability of suitable
connection with the allocated capacity in the Gemini System to allow
interconnection to the Backhaul and other telecommunications networks
at the System Interface Points at the STM-1 level.
4. REDUCTION IN CAPACITY
In the event that the capacity that the Gemini Network is capable of
providing at the RFS Date is less than the capacity purchased by
Carrier Users, or in the event that the capacity the Gemini Network is
capable of providing is reduced below the level purchased by Carrier
Users at any time during the System Lifetime, due to physical
deterioration or for any other reason, the available capacity shall be
assigned to Carrier Users in proportion to their respective shares of
the purchased capacity in an equitable manner as determined by the
Management committee. In case of such capacity reduction, Gemini will
recompute the pro rate allocation of and make appropriate adjustments
to the O&M Costs and associated Fees payable by each Carrier User.
5. INTERCONNECTION
Carrier Users will be allowed to interconnect their networks with the
Gemini Network either
(i) at a Backhaul Interface Point at the STM-1 level; or
(ii) at a System Interface Point at the STM-1 level; or
(iii) Transit Circuit purposes only, at the Porthcurno, United Kingdom
System Interface Point, at the STM-1, DS-3 or E-1 levels.
The interface will be in accordance with the appropriate ITU-TS
recommendation
6. OPERATION AND MAINTENANCE - DUTIES AND RIGHTS
6-1 Subject to the regulatory compliance obligations of the Landing
parties, Gemini shall have responsibility to control, operate and
maintain the various Segments and Subsegments of the Gemini Network in
a manner consistent with applicable law and with international cable
operation and maintenance practices Gemini shall be the maintenance
authority for the Gemini Network and shall use a reasonable efforts to
maintain the Gemini System Network economically in efficient working
order and with the objective of achieving effective and timely repairs
when necessary.
6.2 Gemini shall have the right to deactivate on a temporary basis
all or any part of the Gemini network in order to perform the duties
imposed upon it in this Clause or at the instruction of a Landing Party
or Backhaul provider where specifically required for regulatory
compliance. Prior to such deactivation, reasonable notice shall be
given and coo-ordination shall be made with Carrier users.
6.3 Gemini shall advise Carrier Users in writing of the timing and
scope of significant planned maintenance operations, of significant
changes to existing operations and maintenance methods, and of
significant impact on the operation or maintenance of the Gemini
Network.
7. OPERATING AND MAINTENANCE COSTS
7.1 O&M Costs shall be defined as all costs reasonably incurred by
Gemini in operating, maintaining and repairing-mg the Gemini Network,
including, but not limited to, the costs of attendance at repair
operations, testing, adjustments, repairs, placement and additions,
storage of plant and equipment, vendor charges, Backhaul
Interface Point charges, other Backhaul charges, Landing Partty Cable
Station charges, electricity, personnel expenses, providing cable
ships, remotely controlled submersible vessels, cable depots or
any other necessary maintenance or repair devices and facilities which
are or may become available (including the standby costs of such
facilities), reburial and the replacement of plant, tools and
test equipment, terrestrial repairs, restoration, customs duties, taxes
(except income taxes imposed on the net income of Gemini),
insurance, rights of way, supervision and overheads.
7.2 Gemini may authorize the purchase and use of special tools and
test equipment which may reasonably be required for the maintenance or
repair of the Gemini Network. The related costs may include, but are
not limited to, the costs, or an appropriate share thereof, for the
purchase, storage, and maintenance of this equipment, which will be
included as part of the O&M costs.
8. OTHER RESPONSIBILITIES OF GEMINI
WorldCom warrants that in its agreement with Gemini that Gemini shall
take responsibility for ensuring that.
(i) The technical design for the Gemini Network is in accordance with
good engineering practice, appropriate recommended national and
international technical standards.
(ii) The Gemini Network is technically in compliance with ITU-TS
recommendations pertaining to system interfaces at the System Interface
Points;
(iii) All necessary permits, licenses, regulatory approvals and other
authorizations to enable the Gemini Network to be landed, installed,
operated, maintained and repaired in the UK and US are obtained, are in
accordance with the respective UK and US law, and continue in effect
during the term of this Agreement; and
(iv) Reasonable restoration arrangements are made available as
appropriate with other cable system.
9. RETIREMENT AND EXTENSION OF GEMINI NETWORK
WorldCom warrants that in its agreement with Gemini that :
9.1 Gemini intends to operate and maintain the Gemini network for the
expected System Lifetime of 25 years from the RFCS Date, unless the
System Lifetime is extended or reduced in accordance with the provision
of this Clause 9.
9.2 Gemini may retire the Gemini Network in the event of a
catastrophic failure of all or a portion of the Gemini Network whether
caused by natural hazard or major technical fault, which makes it
impossible to maintain the business efficacy of the Gemini Network, or
if any governmental, municipal, institutional, or commercial authority,
license, permission authorization, right, or concession necessary for
the business efficacy of the Gemini Network is subject to prohibitive
condition or is terminated with no reasonable prospect of retrieval
within a period of twelve months following the date of termination.
9.3 Upon the occurrence of any event falling within Clause 19.2, the
GUCC shall be entitled to require Gemini to confirm to the GUCC its
intentions in relation to either (a) the extension of the System
Lifetime of the Gemini Network beyond the expected System Lifetime of
twenty-five years or (b) the decommissioning of the Gemini Network
prior to the end of such expected System Lifetime and as the terms and
conditions upon which such extension or decommissioning would be
effected.
9.4 If, after receiving notification of the terms and conditions
governing extension, Carrier users holding a total of two-thirds of the
assigned capacity of the Gemini Network vote in favor of requesting
extension of the System Lifetime beyond twenty-five years, and Gemini
and the Founding Parties concur in this decision, Gemini shall extend
the System Lifetime for such additional terms as Gemini believe in its
sole discretion to be advisable.
9.5 If, after receiving notification for the terms and conditions
governing decommissioning, Carrier Users holding a total of to-thirds,
of the assigned capacity for the Gemini Network vote in favor of
requesting decommissioning, and the Gemini and the Founding Parties
concur in this decision, Gemini shall be responsible for the orderly
retirement of the Gemini Network and shall proceed to retire from
service the Gemini Network in accordance with appropriate national and
international regulations.
9.6 Upon retirement of the Gemini network, Gemini shall give to
Carrier users three (3) months' notice of any intended sale or removal
operations and make arrangement for minimizing the risks to other
seabed users of such an operation.
10. DURATION
The provisions of this C&MA shall continue in effect, as amended from
time to time by Gemini, for the system Lifetime, subject to the earlier
retirement of the Gemini Network in accordance with the terms of the
CSA and of this C&MA.
11. GOVERNMENTAL APPROVALS
This C&MA is subject to the obtaining and continuance of such
governmental approvals, consents, authorizations, licenses, and permits
as provided in this C&MA and in the CSA.
12. HEADINGS, REFERENCES
Headings are inserted for convenience only and shall not affect the
interpretation of this C&MA. References to recitals, clauses, and
attachments are to recitals and clauses of and attachments to this
C&MA. Unless the context otherwise requires, words importing the
singular number shall include the plural and vice versa, words
importing he masculine gender shall include the feminine and neuter
genders, and vice versa. Unless the context otherwise requires,
references to a person include an individual, firm, body, corporation,
unincorporated association, and government or governmental or local
authority or agency.
13. AMENDMENTS
This C&MA and any of its provision maybe amended or added to only in
writing signed by a duly authorized person on behalf of Gemini In the
event that Gemini shall propose material changes to the terms of this
C&MA, it shall notify GUCC and shall consult with the GUCC as to the
nature and terms of any proposed amendment. Notwithstanding the
foregoing, in no event shall such changes materially alter or diminish
Gemini's obligations under the CSA.
