EXHIBIT 10.42
IRU AGREEMENT
BETWEEN
COMPANHIA PORTUGUESA RADIO XXXXXXX, XX
AND
STARTEC GLOBAL COMMUNICATIONS CORPORATION
TPC-5 CABLE NETWORK IRU AGREEMENT
THIS AGREEMENT, made and entered into this Dec 15 day of December, 1998,
between:
COMPANHIA PORTUGUESA RADIO XXXXXXX, X.X., a corporation organized and existing
under the laws of Portugal, with the capital stock of PTE 15,600,000,000$00,
corporte body 500069131, registered in the Commercial Registry of Lisbon under
the number 10844 and having its main office at Xx. Xxxxxx Xxxx, 0, 0000 Xxxxxx
Codex, Portugal (hereinafter called "MARCONI" which expression shall include
its successors and assigns), and
STARTEC GLOBAL COMMUNICATIONS CORPORATION, a Maryland corporation having its
principal office at 00000 Xxxxx Xxxx Xxxxx, Xxxxx 000, Xxxxxxxx, XX 00000,
U.S.A., (hereinafter called "STARTEC", which expression shall include its
successors and assigns).
WITNESSETH
WHEREAS, an Agreement (hereinafter called "TPC-5 C&MA") was entered into
effective 29 October 1992 and amended on 16 May 1995, amended on 31 October
1995, amended on 17 June, 1996 and amended 3 December 1996, to provide,
construct, maintain and operate the TPC-5 Cable Network (hereinafter called
"TPC-5" or "the Cable Network"), connecting the United States Mainland, on the
west, and points in or reached via the United Kingdom and France on the east;
and
WHEREAS, MARCONI is a Party to the TPC-5 C&MA; and
WHEREAS, TPC-5 shall be regarded as consisting of the following Segments:
Segment A: a cable station at Coos Bay, Oregon, U.S.A.
Segment B: a cable station at San Luis Obispo, California, U.S.A.
Segment C: a cable station at Keawaula, Hawaii, U.S.A.
Segment D: a cable station at Tumon Bay, Guam.
Segment E: a cable station at Miyazaki, Japan.
Segment F: a cable station at Ninomiya, Japan.
Segments A, B, C, D, E and F shall consist of:
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(i) an appropriate share of land and buildings at the specified locations for
the cable landing and for the cable route including cable rights-of-way and
ducts or conduits between the cable station and its respective Cable
Landing Point, and an appropriate share of common services and equipment at
each of the locations; and
(ii) cable station equipment including multiplex equipment down to the primary
level, as required, in each of the cable stations associated solely and
directly with the TPC-5.
Segment G: The whole of the submarine cable provided between and including the
Network Interface at the cable station at San Luis Obispo, California, on the
U.S. Mainland, and the Network Interface at the cable station at Keawaula,
Hawaii, and containing two optical fiber pairs, each such fiber pair capable of
operating at 4.8 Gigabits per second (Gbit/s), one of which is the Service Fiber
Pair and the other of which is the Restoration Fiber Pair.
Segment H: The whole of the submarine cable provided between and including the
Network Interface at the cable station at Keawaula, Hawaii, and the Network
Interface at the cable station at Tumon Bay, Guam, and containing two optical
fiber pairs, each such fiber pair capable of operating at 4.8 Gigabits per
second (Gbit/s), one of which is the Service Fiber Pair and the other of which
is the Restoration Fiber Pair.
Segment I: The whole of the submarine cable provided between and including the
Network Interface at the cable station at Tumon Bay, Guam, and the Network
Interface at the cable station at Miyazaki, Japan, and containing two optical
fiber pairs, each such fiber pair capable of operating at 4.8 Gigabits per
second (Gbit/s), one of which is the Service Fiber Pair and the other of which
is the Restoration Fiber Pair.
Segment J: The whole of the submarine cable provided between and including the
Network Interface at the cable station at Miyazaki, Japan, and the Network
Interface at the cable station at Coos Bay, Oregon, on the U.S. Mainland, and
containing two optical fiber pairs, each such fiber pair capable of operating at
4.8 Gigabits per second (Gbit/s), one of which is the Service Fiber Pair and the
other of which is the Restoration Fiber Pair.
Segment T1: The whole of the submarine cable provided between and including the
Network Interface at the cable station at Coos Bay, Oregon, on the U.S.
Mainland, and the Network Interface at the cable station at San Xxxx Obispo,
also on the U.S. Mainland, and containing two optical fiber pairs, each such
fiber pair capable of operating at 4.8 Gigabits per second (Gbit/s), one of
which is the Service Fiber Pair and the other of which is the Restoration Fiber
Pair.
Segment T2: The whole of the submarine cable provided between and including the
Network Interface at the cable station at Miyazaki, Japan, and the Network
Interface at the cable station at Ninomyia, also in Japan, and containing two
optical fiber pairs, each such fiber pair capable of operating at 4.8 Gigabits
per second (Gbit/s), one of which is the Service Fiber Pair and the other of
which is the Restoration Fiber Pair.
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Segment G, H, I, J, T1 and T2 shall include:
(i) all transmission, power feeding and special test equipment specifically
associated with, and required to operate and maintain the submersible
plant;
(ii) the power equipment provided wholly for use with the equipment listed in
(i) above;
(iii) the transmission cable equipped with appropriate repeaters and joint
housings between the cable stations; and
(iii) the sea earth cable and electrode system and/or the land earth system, or
an appropriate share thereof, associated with the terminal power feeding
equipment.
In this Agreement, references to any Segment, however expressed, shall be
deemed to include, unless the context otherwise requires, additional property
incorporated therein by agreement of the Parties. Each Segment shall be
regarded as including its related spare and standby units and components,
including, but not limited to, submersible repeaters, cable lengths and
terminal equipment; and
WHEREAS, a MIU is defined in the TPC-5 C&MA as a unit designated as the minimum
unit of investment in the Cable Network allowing the use of 2.048 Mbits/s and
the additional 420,571.43 bits per second required for multiplexing in each
direction.
WHEREAS, MARCONI and STARTEC have agreed that a portion of the capacity in the
Cable Network currently wholly assigned to MARCONI shall be offered to STARTEC
for purchase on an Indefeasible Right of Use basis (hereinafter called "IRU")
for the use of STARTEC; and
WHEREAS, STARTEC, as an IRU interest holder, will possess an exclusive and
irrevocable right to use, but not the right to control the facility; and
WHEREAS, it is now desired to define the terms and conditions upon which
STARTEC will be granted the IRU in that capacity.
NOW, THEREFORE, the Parties hereto, in consideration of the mutual covenants
herein expressed, covenant and agree with each other as follows:
1. MARCONI grants to STARTEC, on an IRU basis, for the term of this Agreement,
an interest in one (1) Minimum Investment Unit (hereinafter called "MIU")
in TPC-5, between Japan and U.S. Mainland. This MIU will be used for
supplying communications services between points in or reached via Ninomiya
(Japan) and points in or reached xxx Xxx Xxxx Xxxxxx (X.X. Xxxxxxxx).
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0. For the IRU interest in one MIU granted to STARTEC pursuant to this
Agreement, STARTEC shall pay to MARCONI the following:
(i) A lump sum amount of two hundred thousand ($200,000) Dollars equal to
its share of the capital costs incurred for Segments between Japan and
U.S. Mainland, on the date in which this Agreement becomes effective.
(ii) A quarterly amount equal to the portion of the costs of operating,
maintaining and repairing the Cable Network (as defined in the TPC-5
C&MA) allocable to the MIU granted to STARTEC hereunder on a pro-rata
basis.
(iii)STARTEC shall pay all bills rendered to it by MARCONI pursuant to
this Agreement by the end of the month following the month in which
the bills are rendered. All bills will be payable in United States
dollars.
(iv) Bills not paid by the due date will incur a quarterly compounded
financing charge at a rate ten (10) percent per year, effective during
the period that the payment is overdue.
(v) If STARTEC is unable to make payments when required by this Agreement
on the day it is due, or otherwise is in breach of this Agreement, and
such default continues for a period of at least one (1) month, MARCONI
may notify STARTEC in writing of its intent to terminate this
Agreement. Upon receipt of such notification from MARCONI, STARTEC
will have thirty (30) calendar days to remedy such breach or make such
payment. If at the end of the thirty (30) day period, STARTEC has not
paid in full the amounts due hereunder or remedied such breach,
MARCONI may proceed to terminate this Agreement by giving STARTEC
written notice thereof effective upon the date of mailing or such
later date as may be specified in the notice, and MARCONI shall be
relieved of any liability to STARTEC arising out of such termination.
The rights and obligations of STARTEC under this Agreement shall
terminate as of the date of termination, except that the termination
shall not relieve STARTEC of its obligation to make full payment of
all amounts incurred under this Agreement up to and including the day
of termination.
3. In the event that the total number of equivalent MIUs which the Cable
Network involved is capable of providing is reduced as a result of physical
deterioration, or for other reasons beyond the control of Parties to the
TPC-5 C&MA, and if such reduction shall extend to fractions of MIUs, the
number of circuits sold to STARTEC hereunder may be reduced in the same
proportion as the total number of circuits is reduced.
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4. Neither Party shall be liable to the other for any loss or damage sustained
by reason of any failure in or breakdown of, or of the facilities
associated with the Cable Network, or for any interruption of service
whatsoever shall be the cause of such failure, breakdown or interruption
and however long it shall last.
5. The operation by STARTEC of the IRU interest granted to it hereunder and
any equipment associated herewith with the previous written consent of
MARCONI shall be such as not to interrupt, interfere with or impair service
over any of the facilities comprising the Cable Network, any other circuits
of MARCONI or any circuits of MARCONI's associated, affiliated or
connecting companies or of other right of user grantees, impair privacy of
any communications over such facilities or circuits, cause damage to plant,
or create hazards to the employees of any of the aforementioned companies,
or of any owner of the aforementioned facilities or circuits or to the
publlc. STARTEC shall hold harmless MARCONI and bear the cost of any
additional protective apparatus reasonably required to be installed because
of the use of facilities by STARTEC, any lessee of STARTEC, or any customer
or customers of STARTEC or of any such lessee, and the cost of any possible
damage thereto related.
A consent granted under this clause may be revoked at anytime by MARCONI if
the provisions of the clause are not fulfilled. Such equipment, if used,
shall not constitute a part of TPC-5. Similar obligations will be included
in any such agreements made with users of TPC-5.
6. The capacity in the Cable Network made available to STARTEC hereunder shall
be maintained, or caused to be maintained, in efficient working order in
accordance with the TPC-5 C&MA.
In this regard, at a time agreeable to MARCONI, the MIU sold to STARTEC
hereunder shall be made available to MARCONI to make such tests and
adjustments as may be necessary for such circuits to be maintained in
efficient working order.
7. In the event of liquidation of the Cable Network, or any part thereof, by
sale or other disposition, during the term in which this Agreement is in
force, MARCONI shall share with STARTEC the net Proceeds or cost of such
sale or disposition, STARTEC's share of such proceeds or cost being
proportionate to its contribution to the capital cost of the subject of
said liquidation or disposition.
8. No license under patents is granted by MARCONI or shall be implied or arise
by estoppel in STARTEC's favour with respect to any apparatus, system or
method used by STARTEC in connection with the use of the MIU sold to it
hereunder. With respect to claims of patent infringement made by third
persons, (i)
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MARCONI will save STARTEC harmless against claims arising out of the use by
STARTEC of such half circuits in accordance with the provision of this
Agreement, and (ii) STARTEC will save MARCONI harmless against claims
arising out of combining such half circuits or using such half circuits in
connection with any apparatus, system or method provided by STARTEC.
9. MARCONI shall keep and maintain for a period of not less than three (3)
years such books, records, vouchers and accounts of all its costs with
respect to the provision and maintenance of the Cable Network as may be
appropriate to support the billing of any such costs to STARTEC and shall
at all reasonable times make them available for inspection by STARTEC.
10. The performance of this Agreement by the Parties is contingent upon:
(i) The provision and continued operation of the Cable Network; and
(ii) the obtaining and continuance of such approvals, consents,
governmental authorizations, licenses and permits as may be required
or be deemed necessary by the Parties hereto. The Parties shall use
their best efforts to obtain and continue such approvals, consents,
authorizations, licenses and permits.
11. Unless otherwise stipulated, no transfer of the rights granted under this
Agreement or of any right resulting from it by either of the Parties to
this Agreement shall be considered valid without the written consent of the
other Party to this Agreement, except to a successor or assign or
subsidiary of such Party, or corporation controlling, or under the same
control as such Party, in which case written notice shall be given in a
timely manner by the Party making said transfer.
12. This Agreement and any of the provisions hereof may be altered or added to
by any other agreement in writing signed by both Parties by a duly
authorized person on behalf of each Party.
13. The relationship between the Parties hereto shall not be that of partners,
and nothing contained herein shall be deemed to constitute a partnership
between them.
14. This Agreement shall be binding upon, and inure to the benefit of, the
Parties, their successors, administrators and permitted assigns.
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15. This Agreement shall become effective on the date and year first above
written and shall continue in effect for the duration of the TPC-5 C&MA.
MARCONI shall give STARTEC notice in writing of the termination of the
TPC-5 C&MA by not less than three (3) months before such termination.
16. For all purposes, the addresses of the Parties to this Agreement shall be
as follows, unless otherwise designated in writing by the respective
Parties:
Vendor
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COMPANHIA PORTUGUESA RADIO XXXXXXX, XX
Xx. Xxxxxx Xxxx, xx 0
0000 XXXXXX CODEX
PORTUGAL
Purchaser
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STARTEC GLOBAL COMMUNICATIONS CORPORATION
00000 Xxxxx Xxxx Xxxxx
Xxxxx 000, Xxxxxxxx
XX 00000, X.X.X.
17. All information, except such information in the public domain, exchanged
between the Parties under this Agreement or during the negotiations
preceding this Agreement and relating either to the existence or terms and
conditions of this Agreement or any activities contemplated by this
Agreement is confidential to them, their employees, legal advisers and
other consultants and may not be disclosed to any third Party, Not
withstanding anything to the contrary or contained herein, a Party shall be
allowed to disclose confidential information pursuant to judicial or
governmental order or if otherwise required to do so by law.
18. a) All disputes arising in connection with the present Agreement shall be
finally settled under the rules of Conciliation and Arbitration of the
International Chamber of Commerce by one or more arbitrators appointed
in accordance of said rules.
b) The arbitrator or arbitrators are authorized to act as amiable
mediators (ex aequo et xxxx) in reaching a conclusion as to the rights
and obligations of the parties in dispute, under the English Law.
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c) The arbitration shall take place in London, at a venue to be fixed by
arbitrator or arbitrators, and the Language of arbitration shall be
the English.
19. This Agreement shall be executed in two counterparts in the English
language. Each counterpart, when executed and delivered, shall be an
original, and such counterparts shall together (as well as separately)
constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto have severally subscribed these presents
or caused them to be subscribed in their names and behalf by their respective
officers thereunto duly authorized.
COMPANHIA PORTUGUESA RADIO XXXXXXX, XX
by:
Lisbon, 23 November 1998
STARTEC GLOBAL COMMUNICATIONS CORPORATION
by:
Bethesda, /s/ RY 1998
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