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This is a fair and accurate English translation of a Spanish language
document as required by Rule 306(a) Regulation S-T.
/s/ XXXX X. XXXXXX
------------------------------
Xxxx X. Xxxxxx
Vice President, Administration
and Chief Accounting Officer
IMPSAT Corporation
July 15, 1998
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EXHIBIT 10.5
SERVICE AGREEMENT
This agreement is being entered into on the ___ day of ___, 19__,
between Organizacion Internacional de Telecomunicaciones por Satelite (hereafter
"INTESALT"), an international organization established by an Agreement with
regard to Organizacion Internacional de Telecomunicaciones por Satelite
"INTESALT" (hereafter "INTESALT Agreement") and the Operational Agreement
regarding the same (hereafter "INTELSAT Operational Agreement"), executed in
Washington, D.C., on August 20, 1971, with headquarters in Washington, D.C.,
U.S.A., and IMPSAT S.A. (hereafter the "client"), ___________________ formed in,
and subject to the laws of COLOMBIA, and authorized by one or several
Signatories of INTELSAT to have direct access to a space segment of INTELSAT.
WHEREAS INTELSAT and the client wish to execute an agreement which
sets the basic terms and conditions for the client's direct access to the space
segment of INTELSAT,
INTELSAT and the client, THEREFORE, agree as follows:
1. Definitions
"Party" means a State for which the INTELSAT Agreement has come into
force.
"Signatory" means a Party, or a telecommunications entity designated
by a Party, which executed the Operational Agreement of INTELSAT.
2. Basic agreement for orders
This agreement serves as a basic contract for orders. Subject to the
terms and conditions of this agreement, INTELSAT agrees to do everything
possible to make available to the client the space segment capacity of INTELSAT
which the client requests periodically. The client shall present requests for
capacities on specific forms for seeking and changing the services listed in
SSOG-104, "Forms for orders, changes and information regarding services".
Requests for services and assigning of capacity, once approved by INTELSAT,
shall be regulated by the instant agreement. The client understands and accepts
that the present agreement does not constitute an obligation or a promise,
express or implicit, on the part of INTELSAT, in the sense that the client will
be assigned a space segment capacity of INTELSAT.
3. Terms and general conditions
On the date of the instant agreement, the client agrees to abide by
the terms and conditions established by INTELSAT for services supplied by way of
assigning space segment capacity by INTELSAT, in accordance with the instant
agreement. The said terms and conditions include those which are contained in
the Standards for Ground Stations of INTELSAT (IESS), the Manual for Using the
Satelite System (SSOG) and the INTELSAT Rates Manual, which are
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incorporated into the instant agreement by reference, as long as such terms and
conditions correspond to the specific type of services requested by the client,
and assigned by INTELSAT in accordance with the instant agreement; such term can
be modified periodically. The terms and conditions of each assignment of
capacity shall be those in force at the time the assignation is being made, and
will not change during the original period of assignation. The client also
agrees to abide by all of the regulation conditions and issuance of licenses by
the appropriate national authorities, and to respect the same.
4. Investment in INTELSAT
Should the client invest in INTELSAT, it obligates itself to abide by
the terms and conditions contained in the agreement with the investing entity
the client subscribes with INTELSAT.
5. Conditions for receiving capacity from INTELSAT
a. A request for reserve or supply of capacity for an INTELSAT space
segment submitted by a client may be denied unless the Management of INTELSAT
has determined that the said client is solvent. The client agrees to submit the
information required by INTELSAT regarding its financial and credit history.
Moreover, the client agrees to authorize INTELSAT to verify the said information
with various financial and banking institutions, and/or the client's creditors.
b. Requests for capacity of space segments of INTELSAT shall not be
accepted should the said client owe on the date of request for capacity, an
amount on an invoice past due for thirty (30) days or more.
c. As a condition for reserving or supplying services, INTELSAT may seek
from the client to offer other guaranties of its capability to abide by the
financial obligations for INTELSAT to agree to these, in the form of a credit
document, a guaranty deposit, or another form of guaranty meeting the
requirements of INTELSAT.
6. Sanctions for past due payments
a. In addition to the sanctions indicated in paragraph 5.b, above, any
payment not made on its due date shall accrue interest at an annual rate of
sixteen percent (16%), calculated from the due date to the payment date; the
Board of Directors of INTELSAT may change periodically the said rate.
b. INTELSAT may suspend or cancel all services, both current ones and
those on the client's waiting list should the amount owed to INTELSAT for using
the space segment not be paid within 60 days or more from its due date, or
within the period the Board of Director of INTELSAT establishes periodically.
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7. Ground station operation
With respect to any authorization from INTELSAT for ground stations
to have access to the space segment, the client obligates itself to operate such
a station at all times in accordance with the terms of the authorization and the
Standards for INTELSAT ground stations (IESS), and accepts the responsibility
for such an operation, including, among others, the financial responsibility.
8. Transfer
This agreement, the subsequent assigning of the segment space
capacity, the rights, duties and obligations of the client, shall not be
transferred or delegated without the prior written consent of INTELSAT. Any
transfer or delegation made without said consent shall be null and void. This
clause does not impede the client from using its assigned capacity to provide
services to third parties.
9. Rescission
In addition to the provisions regarding cancellation, contained in
the Manual for Rates, INTELSAT reserves the right, with a prior written
notification of at least thirty(30) days, to rescind the instant agreement
executed with the clinet should the latter not abide by the same. The notice of
rescission shall indicate the date the rescission goes into force and the
circumstances which brought it about. INTELSAT shall keep, at its discretion,
the deposits or other amounts paid by the client, and shall use these to
compensate for the prejudice which it may have suffered as a result of such a
lack of compliance. This holding of the client's funds shall not impede INTELSAT
from presenting other claims for compensation, or from seeking other payments
for damages and prejudice to which it has right by law or equity. Such a right
to rescission shall not take place if, within the said period of thirty days the
client resolves its infraction to the satisfaction of INTELSAT.
10. Confidentiality
INTELSAT and the client agree to take precautions to keep
confidential all information the parties present as confidential, and which are
designated as such in writing, or marked "confidential", "private property", or
"limited distribution", with an appropriate seal of markings. Neither party
shall reveal information which the other one designated as confidential,
personal property or limited distribution, except to its employees or agents, to
the extent required for the exclusive objective of executing the
responsibilities assigned in the instant agreement, or to establish or supply
the services by way of assignments granted by virtue of the instant agreement.
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11. Notifications
Notifications, announcements, payments and other communications
connected to the instant agreement, shall be sent to the following addresses:
For the client: For INTELSAT
IMPSAT S.A. Organizacion Internacional de Telecomunicaciones
Diagonal 126 Xx. 00-00 xxx Xxxxxxxx (XXXXXXXX)
Xxxxx Xx xx Xxxxxx - Xxxxxxxx 0000 Xxxxxxxxxxxxx Xxxxx, X.X.
Xxxxx Xxxxxxx Xxxxxxxxxx, X.X. 00000-0000
Xxxxxx Xxxxxx [of America]
Attn: XXXXX X. XXXXXX XXXXXXXX
Financial and Adm. Vice-President Attn: Vice-President
Tel. (000) 000 0000 Sales and Marketing
Fax (000) 000 0000
Tel. x0 000 000-0000
Fax x0 000 000-0000
It shall be deemed that such notifications, announcements or payments
have been duly delivered when they are presented by hand, certified mail, telex,
fax, or, in the case of payments, by sending cash, checks from the client's
business account, certified bank checks, or telegraphic money orders. All
payments from the client to INTELSAT required by the instant agreement shall be
made in United States dollars, or a currency which can be freely converted into
United States dollars. Both parties obligate themselves to keep this information
up-to-date, and to notify each other promptly of any changes in the pertinent
information regarding invoicing, use of the assigned capacity and communications
in general.
12. Resolution of disputes
The parties agree to try to resolve disputes or claims which [may]
arise with regard to the instant agreement, or services provided by virtue of
the same, within sixty (60 days), a long mutually agreed-upon period, from the
date on which one of the parties has notified the other party in writing of the
existence of a dispute or claim. Should the parties not reach an agreement
within the said period, either one of them may submit the dispute or claim to
arbitration for a resolution, in accordance with the UNCITRAL arbitration rules
in force on the date of the agreement. In accordance with the said rules, the
American Arbitration Association shall have the authority to designate
arbitrators, and the arbitration shall take place in Washington, D.C., U.S.A.
13. Jurisdiction
The instant agreement, except for the provisions connected to
conflicts between various laws, shall be subject to the laws of the District of
Columbia, U.S.A. The rights and recourse
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conferred by virtue of this instrument and other rights and recourses shall be
cumulative and exercised alone or concurrently. Should either party not exercise
its rights by virtue of this right, or other rights, this shall not be construed
as a waiver of these rights, or other rights, in the future. Should any
provision in the instant agreement be determined as null, this shall not affect
the other provisions herein, and the null provision shall be replaced with an
acceptable provision, in agreement with the original intent of the parties.
Each party acknowledges having read and understood the provisions
contained in the instant agreement, and agrees to submit to such provisions.
IN WITNESS WHEREOF the parties have instructed their duly authorized
representatives to execute the instant agreement.
Organizacion Internacional de ("Client")
Telecomunicaciones por Satelite
("INTELSAT")
By: [signature] By: [signatures]
---------------------------------------------------------- ----------------------------------------------------------
Xxxxxxx Xxxxxx XXXXX X. XXXXXX XXXXXXXX
---------------------------------------------------------- ----------------------------------------------------------
(in printed letters) (in printed letters)
Title: Group Marketing and Sales Title: Financial and Administrative Vice
------------------------- ---------------------------------
Manager, Latin America President
---------------------- ---------
Date: 9/4/97 Date: 8/13/97
---------------- -----------------
CERTIFICATE
I, XXXX XXXX XXXXXX XXXXXXX, SECRETARY GENERAL of IMPSAT S.A., hereby
certify that XXXXX X. XXXXXX XXXXXXXX, who executed the above instrument, has
the position of Vice-President, and is duly authorized to execute the above
agreement in the name of IMPSAT S.A.
In witness whereof, I hereby sign this instrument on August 13, 1997.
[signatures]
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ADDITIONAL CONTRACT No. 1AL C-0057-95
EXECUTOR: IMPSAT S.A.
OBJECT: Extension of the period [of validity] and additional satellite space
TITLE: AGREEMENT FOR SUBSCRIPTION TO BASIC SATELLITE SERVICES FOR THE SUPPLYING
OF VALUE ADDED SERVICES.
Between us, XXXX XXXXXXXXX, of age, resident of Santafe de Bogota, with citizen
identification No. 17,178,909, issued in the city of Bogota, acting in the name
and stead of EMPRESA NACIONAL DE TELECOMUNICACIONES, which will be named
hereafter TELECOM, and XXXXXX XXXXX, of age, resident of Santafe de Bogota, with
identification for foreigners No. 250,534, issued at the city of Bogota, acting
in the name and stead of IMPSAT S.A., a party which hereafter is named THE
SUBSCRIBER; we have agreed to execute the instant additional agreement No. 1 to
Contract C-0057-95 executed on December 26, 1995, of which the object was
supplying to THE SUBSCRIBER telecommunication services called basic satellite
services for provided valued added services. b) That THE SUBSCRIBER has sought
before INTELSAT, through TELECOM, an increase in the capacity of the space
segment, object of the guaranteed engagement of the principal Agreement,
capacity stated in the Financial Technical Appendix, which forms a part of the
instant Additional Agreement. c) That THE SUBSCRIBER has constituted before
INTELSAT, through TELECOM, an additional guaranty reserve with a commencement
date of January 1, 1997, and termination date of April 30, 2008, as stated in
Appendix in the Technical-Financial Appendix, attached to the instant additional
agreement. Given the above, the parties agree [as follows]: ONE. PURPOSE OF THE
AGREEMENT. The instant Additional Agreement, C-0057-95, has as its purpose to
add satellite capacity on Band C and Band Ku (in accordance with the
Technical-Financial Appendix), and to extend until April 30, 2008, the
termination the date for the lease Agreement on the satellite located at 310oE
of Intelsat, date on which will end the validity of the guaranteed additional
reserve constituted by THE SUBSCRIBER before INTELSAT through TELECOM.
TWO.VALIDITY OF THE ARTICLES IN THE PRINCIPAL AGREEMENT: All articles in the
principal Agreement shall remain in force, as long as they do not contradict the
provisions contained in the instant ADDITIONAL AGREEMENT. THREE. GUARANTY: THE
SUBSCRIBER shall, at its expense, proceed with extending the sole guaranty
within the scope of the Additional Agreement, under the terms of article Fifteen
of the Principal Agreement. FOUR. PUBLICATION: Within five (5) days following
the execution of the instant ADDITIONAL AGREEMENT, the subscriber shall submit
to TELECOM the consignment receipt for publication in Diario Unico de
Contratacion Publica. The publication is required to render the ADDITIONAL
AGREEMENT legal, which shall be deemed concluded with the payment of the
corresponding rights. FIVE. EXECUTION AND LEGALIZATION: The instant ADDITIONAL
AGREEMENT is [deemed] executed upon the signature of the Parties. THE SUBSCRIBER
shall pay the stamp tax in accordance with Law. In witness whereof this is
executed in Santafe de Bogota, on the 16th day of March, 1998.
FOR TELECOM FOR THE SUBSCRIBER
[signature] [signature]
XXXX XXXXXXXXX XXXXXX XXXXX
President President
This is a true certified copy
Judicial Department
[signature]
Empresa Nacional de Telecomunicaciones
8
TECHNICAL-FINANCIAL APPENDIX
TO ADDITIONAL AGREEMENT AL. C-0057-95
Page No. 1
SUBSCRIPTION: C-0057-95
SUBSCRIBER: IMPSAT S.A.
SERVICE ACCOUNT: 8001368351
PURPOSE: Supply of satellite capacity for Value Added services
CITY AND DATE: Santafe de Bogota
Diagonal 126 No. 67-19
IMPSAT S.A.
IN SATELLITE 705 OF INTELSAT
POSITION 310(degrees)E - NOT SUBJECT TO INTERRUPTION
Lease SVOL-6064
---------------------------------------------------------------------------------------------------------------------------
BAND WIDTH
TOTAL LEASED BAND
ACTIVATION BASE FOR WIDTH FOR MONTHLY
PERIOD CALCULATION OF IMPSAT AMOUNT IN US$
MONTHLY RATE COLOMBIA
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From November 1, 1996,
to February 24, 1997 60 37 $ 108,225
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From February 25, 1997,
to April 2, 1997 65 42 $ 122,850
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From April 3, 1997, to
April 6, 1997 71 48 $ 140,411 (1)
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From April 7, 1997, to
May 20, 1997 71 48 $ 135,011 (2)
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From May 1, 1997, to
July 31, 1997 72 49 $ 113,982 (3)
---------------------------------------------------------------------------------------------------------------------------
From August 1, 1997,
to September 16, 1997 72 49 $ 126,647 (4)
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From September 17, 1997,
to July 1, 2005 72 53 $ 136,986
---------------------------------------------------------------------------------------------------------------------------
THE AMOUNTS ABOVE DO NOT INCLUDE V.A.T. WHICH SHALL BE BORNE BY THE SUBSCRIBER.
THE APPLICABLE RATE IS THE RATE IN FORCE AT THE TIME OF ACTIVATION OF THE
CAPACITY.
NOTES (1) Cost of 48 Mhz, prior rates with 10% discount the first year.
(2) Cost of 48 Mhz, with the new Telecom rates, with a 10% discount the first year.
(3) Cost of 48 Mhz, with the new Telecom rates, with a 10% discount the first year.
(4) Cost of 48 Mhz, with the new Telecom rates, without a 10% discount the first year.
This Appendix fully replaces the appendix executed by the parties in 1995.
FOR TELECOM FOR IMPSAT S.A.
[signature] [signature]
XXXXXX XXXXX XXXXXXX XXXXXXX XXXXXX XXXXX
Executive Vice-President Legal Representative
I.D. 17,181,322 I.D. 250.534
This is a true certified copy
Judicial Department
[signature]
Empresa Nacional de Telecomunicaciones
9
TECHNICAL-FINANCIAL APPENDIX
TO ADDITIONAL AGREEMENT AL. C-0057-95
Page No. 2
SUBSCRIPTION: C-0057-95
SUBSCRIBER: IMPSAT S.A.
SERVICE ACCOUNT: 8001368351
PURPOSE: Supply of satellite capacity for Value Added services
CITY AND DATE: Diagonal 126 No. 67-19
IMPSAT S.A.
IN SATELLITE 705 OF INTELSAT
POSITION 310(degrees)E - NOT SUBJECT TO INTERRUPTION
2. ADDITIONAL LEASE IN INTELSAT (SVO-L-6557)
-------------------------------------------------------------------------------------------------------------------------------
TOTAL BAND BAND WIDTH MONTHLY RATE IN
ACTIVATION WIDTH LEASED FOR IMPSAT US$ CONTRACTUAL
PERIOD TO INTELSAT COLOMBIA PERIOD 10 YEARS
-------------------------------------------------------------------------------------------------------------------------------
From January 1, 1997, to
May 31, 1997 (note 1) 0.5 0.5 $ 2,545
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From June 1, 1997, to
December 31, 1997 (note 1) 5 5 $ 20,689
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From January 1, 1998, to
April 30, 2008. 5 5 $ 22,988
-------------------------------------------------------------------------------------------------------------------------------
THE RATE APPLIED IS THE RATE IN FORCE AT THE TIME OF ACTIVATION OF THE CAPACITY.
NOTES (1) Include the 10% discount for the first year.
(2) These rates do not include V.A.T. of which the payment is borne
by the Subscriber.
FOR TELECOM FOR IMPSAT S.A.
[signature] [signature]
XXXXXX XXXXX XXXXXXX XXXXXXX XXXXXX XXXXX
Executive Vice-President Legal Representative
I.D. 17,181,322 I.D. 250.534
This is a true certified copy
Judicial Department
[signature]
Empresa Nacional de Telecomunicaciones
10
TECHNICAL-FINANCIAL APPENDIX
TO ADDITIONAL AGREEMENT AL. C-0057-95
Page No. 3
IN SATELLITE 709 OF INTELSAT
POSITION 310(degrees)E - NOT SUBJECT TO INTERRUPTION
Lease SVOL-6738
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TOTAL BAND WIDTH BAND CONTRACTUAL MONTHLY
ACTIVATION LEASED TO WIDTH FOR PERIOD VALUE IN
PERIOD INTELSAT BASED ON IMPSAT US$
CALCULATION OF COLOMBIA
MONTHLY RATE
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From June 1, 1997,
to May 31, 1998 2 0.2 $ 832.00
(note 1)
---------------------------------------------------------------------------------------- 3 YEARS ------------------
From June 1, 1998,
to May 31, 2000 2 0.2 $ 924.00
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THE RATE APPLIED IS THE RATE IN FORCE AT THE TIME OF ACTIVATION OF THE CAPACITY.
NOTE 1: Discount of 10% corresponding to the first year.
NOTE 2: These rates do not include V.A.T. of which the payment is borne by the
Subscriber.
FOR TELECOM FOR IMPSAT S.A.
[signature] [signature]
XXXXXX XXXXX XXXXXXX XXXXXXX XXXXXX XXXXX
Executive Vice-President Legal Representative
I.D. 17,181,322 I.D. 250.534
This is a true certified copy
Judicial Department
[signature]
Empresa Nacional de Telecomunicaciones
11
TECHNICAL-FINANCIAL APPENDIX
TO ADDITIONAL AGREEMENT AL. C-0057-95
Page No. 4
SUBSCRIPTION No.: C-0057-95
SUBSCRIBER: IMPSAT S.A.
SERVICE ACCOUNT: 8001368351
PURPOSE: Use of space segment required for supplying added value services.
DURATION: One year, automatically renewable until the expiration of the term, for which is constituted a
guaranteed reservation of the space segment, ten (10) years in which IMPSAT shall participate.
Commencement date: August 5, 1997
CITY AND DATE: Santafe de Bogota
PLACE OF INVOICING: Diagonal 126 No. 67-19
SATELLITE SEGMENT IN BAND C
SATELLITE IS-VII OF INTELSAT - POSITION 310(degrees)E
STANDARD CAPACITY NOT SUBJECT TO INTERRUPTION
------------------------------------------------------------------------------------------------------------------------------------
INVOICING WIDTH OF TYPE MONTHLY VALUE IN $US
PERIOD LEASED BAND OF BEAM
------------------------------------------------------------------------------------------------------------------------------------
First year with
10% discount 4.2 MHZ NORTH INTELSAT $ 15,530
(note 1) ZONE TELECOM $ 1,941
Total payable to Telecom $ 17,471
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Automatically
renewable 4.2 MHZ NORTH INTELSAT $ 17,255
years ZONE TELECOM $ 2,157
Total payable to Telecom $ 19,412
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TOTAL ANNUAL RATE PAYABLE TO TELECOM FROM AUGUST 5, 1997, TO AUGUST 4, 1998 ............US$ 209,652
TOTAL ANNUAL RATE FOR AUTOMATICALLY RENEWED YEARS ......................................US$ 232,944
THE APPLICABLE RATE IS THE RATE IN FORCE AT THE TIME OF ACTIVATION OF THE
CAPACITY.
NOTE 1: Includes a 10% discount the first year.
NOTE 2: THESE RATES DO NOT INCLUDE V.A.T. WHICH AMOUNT SHALL BE BORNE BY
THE SUBSCRIBER.
FOR TELECOM FOR IMPSAT S.A.
[signature] [signature]
XXXXXX XXXXX XXXXXXX XXXXXXX XXXXXX XXXXX
Executive Vice-President Legal Representative
I.D. 17,181,322 I.D. 250.534
This is a true certified copy
Judicial Department
[signature]
Empresa Nacional de Telecomunicaciones
12
TECHNICAL-FINANCIAL APPENDIX
TO ADDITIONAL AGREEMENT AL. C-0057-95
Page No. 5
SUBSCRIPTION No.:
SUBSCRIBER: IMPSAT S.A.
SERVICE ACCOUNT: 8001368351
PURPOSE: Supply of basic satellite service for supply of added value services.
Date of the lease: 3 years, according to the commencement date of each link.
Date on which the amendment commences: In accordance with the amendment date of each link.
CITY AND DATE: Santafe de Bogota
PLACE OF INVOICING: Diagonal 126 No. 67-19, Santafe de Bogota
The subscriber shall pay the following fees to TELECOM:
Connection rate: US$ 500 for each ground station not approved per type and there will be n
charges for transmission stations approved by type or for reception
stations.
INTERNATIONAL CARRIER LEASED THROUGH INTELSAT
SATELLITE 325.5(degrees) E
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DATE OF ROUTE AND
ACTIVATION OF ANTENNA IN CHARACTERISTICS LAUNCHING MONTHLY
MODIFICATION COLOMBIA OF THE CARRIERS DATE AMOUNT TO BE COMMENTS
INVOICED IN US$
------------------------------------------------------------------------------------------------------------------------------------
June 15, 1997 to BOGOTA-ROMA 256 KBPS March 23, 1995 3205.00 Increase in speed from 192
May 23, 1998 Antenna BOG18F1 FEC 1/2 OPSK m 256 kbps as of June 15
------------------------------------------------------------------------------------------------------------------------------------
April 27, 1997 to XXXX-XXXXXXXX 64 KBPS April 14, 1995 855 Reduction in speed as of 28
April 14, 1998 Antenna FEC 1/2 OPSK April 1997
CAL104F1
------------------------------------------------------------------------------------------------------------------------------------
THE APPLICABLE RATE IS THE RATE IN FORCE AT THE TIME OF ACTIVATION OF THE
CAPACITY.
NOTE 1:
NOTE 2: THESE RATES DO NOT INCLUDE V.A.T. WHICH AMOUNT SHALL BE BORNE BY THE CLIENT.
FOR TELECOM FOR IMPSAT S.A.
[signature] [signature]
XXXXXX XXXXX XXXXXXX XXXXXXX XXXXXX XXXXX
Executive Vice-President Legal Representative
I.D. 17,181,322 I.D. 250.534
This is a true certified copy
Judicial Department
[signature]
Empresa Nacional de Telecomunicaciones