Exhibit 10.57
Fiber Optic Network Leased Fiber Agreement
Product Order
This Product Order ("Product Order") together with the General Terms and
Conditions constitute the Fiber Optic Private Network Agreement ("Agreement")
which is effective as of May 24, 1999 by and between Metromedia Fiber Network
Services, Inc. ("MFN"), Xxx Xxxxx Xxxxxxxxx Xxx., Xxxxxx Xxxxx, Xxxxx Xxxxxx,
Xxx Xxxx 00000, and Focal Financial Services, Inc. ("Carrier"), 000 Xxxxx
XxXxxxx Xx., Xxxxxxx, Xxxxxxxx 00000. Definitions of terms used in this
Agreement appear in this Product Order and in the General Terms and Conditions.
Carrier hereby orders and MFN hereby agrees to provide Leased Fiber as follows:
1. Lease Term: 240 Months
2. Number of Leased Fibers: To Be Determined
3. Number of Leased Fiber Miles: Two Thousand Five Hundred Miles (2,500)
4. Carrier locations ("Location(s)"): To Be Determined
5. Specifications pertinent to the Leased Fiber: To be provided as
attachment, including as-built drawings.
6. Installation Charge and Monthly Lease Payments:
6.1 One Time Installation Charge ***
6.2 Monthly Lease Payments ***
subject to such tolling and discounting
as hereinafter provided
Applicable Taxes (as defined in the Agreement) on the Installation
Charge and all Lease Payments are to be paid by Carrier as and when
due.
7. Estimated Installation Completion Dates: To be provided as
attachment.
8. Early Termination Charge:
In the event of termination of this Product Order pursuant to Section
11.2 of the General Terms and Conditions of this Agreement, Carrier
will pay to MFN an Early Termination Charge (plus Applicable Taxes)
for the Leased Fiber determined as follows:
1st year termination - *** of all unpaid Leased Fiber Monthly Lease
Payments for the first year, plus *** of all unpaid Leased Fiber
Monthly Lease Payments for the second year, plus *** of all unpaid
Leased Fiber Monthly Lease Payments for the third year, plus *** of
all unpaid Leased Fiber Monthly Lease Payments for the fourth year,
plus *** of all unpaid Leased Fiber Monthly Lease Payments for the
fifth year, plus *** of all unpaid Leased Fiber Monthly Lease Payments
for the sixth through twentieth years.
2nd year termination - *** of all unpaid Leased Fiber Monthly Lease
Payments for the second year, plus *** of all unpaid Leased Fiber
Monthly Lease Payments for the third year, plus *** of all unpaid
Leased Fiber Monthly Lease Payments for the fourth year, plus *** of
all unpaid Leased Fiber Monthly Lease Payments for the fifth year,
plus *** of all unpaid Leased Fiber Monthly Lease Payments for the
sixth through twentieth years.
3rd year termination - *** of all unpaid Leased Fiber Monthly Lease
Payments for the third year, plus *** of all unpaid Leased Fiber
Monthly Lease Payments for the fourth year, plus *** of all unpaid
Leased Fiber Monthly Lease Payments for the fifth year, plus
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
*** of all unpaid Leased Fiber Monthly Lease Payments for the sixth
through twentieth years.
4th year termination - *** of all unpaid Leased Fiber Monthly Lease
Payments for the fourth year, plus *** of all unpaid Leased Fiber
Monthly Lease Payments for the fifth year, plus *** of all unpaid
Leased Fiber Monthly Lease Payments for the sixth through twentieth
years.
5th year termination - *** of all unpaid Leased Fiber Monthly Lease
Payments for the fifth year, plus *** of all unpaid Leased Fiber
Monthly Lease Payments for the sixth through twentieth years.
6th through 20th year termination - *** of all unpaid Leased Fiber
Monthly Lease Payments for the remaining Lease Term of this Product
Order.
If Carrier has not yet leased two thousand five hundred (2,500) fiber
miles from MFN hereunder as of the date of any termination, then such
termination shall be calculated as if Carrier has leased two thousand
five hundred (2,500) fiber miles at the per fiber mile per month price
set forth in Section 9.1(b) of this Product Order, without application
of the discount set forth in Section 9.2(a) below.
9. Fiber, Locations and Requirements
9.1 Carrier acknowledges and agrees that within twelve (12) months of
the effective date of this Agreement, Carrier will place product
orders to lease from MFN for a term of two hundred forty (240)
months Leased Fiber subject to the terms and conditions of this
Agreement totaling at least two thousand five hundred (2,500)
fiber miles in at least *** metropolitan areas where MFN has or
reasonably expects to have within such twelve (12) month period
an installed fiber optic network.
(a) For the purposes of this Agreement, fiber miles will be
calculated by multiplying the physical mileage of Carrier's
Leased Fiber route(s) by the quantity of Leased Fiber along
the same route(s).
(b) The monthly lease payment for initial two thousand five
hundred (2,500) Leased Fiber fiber miles that MFN leases to
Carrier within twelve (12) months of the effective date of
this Agreement shall be *** per fiber mile per month.
(c) Carrier further acknowledges and agrees that it shall be
liable to MFN for any difference that may exist between the
monthly lease payment for two thousand five hundred (2,500)
fiber miles and Carrier's actual total Leased Fiber fiber
miles twelve (12) months after the effective date of this
Agreement (the "Contract Balance"). Carrier will not be
liable for payment of any shortfalls due to MFN's inability
to deliver fiber in accordance with a product order. If such
difference exists, MFN will provide Carrier written notice
of the deficiency eleven (11) months after the effective
date of this Agreement and Carrier will then have thirty
(30) days to request additional fiber subject to the terms
and conditions of this Agreement necessary to achieve two
thousand five hundred (2,500) Leased Fiber fiber miles. If
after twelve (12) months from the effective date of this
Agreement Carrier still has not placed orders to lease from
MFN Leased Fiber totaling two thousand five hundred (2,500)
fiber miles, MFN will invoice and Carrier will pay a monthly
lease payment each month for a term of two hundred forty
(240) months equal to the Contract Balance multiplied by ***
per fiber mile per month commencing at the beginning of the
thirteenth (13th) month after the effective date
***Portions of this exhibit have been ommitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
of this Agreement. Any such amount will be subject to an early
termination charge as set forth in Section 8.
(d) In no event shall Carrier be obligated to lease Leased Fiber from
MFN in excess of two thousand five hundred (2,500) fiber miles.
9.2 Carrier will, from time to time, request fiber pursuant to the terms
and provisions hereof, by providing MFN with one or more written
notices. Each such notice shall indicate the number of fibers, the MFN
metropolitan market and Carrier's proposed Locations. Within thirty
(30) days after receipt of such notice, MFN will respond to Carrier
with a product order confirming the availability, the monthly lease
payment, the one time installation charge and the estimated
installation completion date for the requested fiber. Carrier may
request fiber in any metropolitan area that MFN has or reasonably
expects to have within twelve (12) months of the effective date of
this Agreement an installed fiber optic network. Carrier will execute
and return to MFN each such product order within ten (10) days of
receipt thereof.
(a) MFN shall discount by *** the first *** monthly lease payments
for Leased Fiber ordered within *** months of the effective date
of this Agreement.
9.3 MFN commits to provide Carrier for twelve (12) months after the
effective date of this Agreement up to *** fiber strands along any MFN
network ring. Subject to fiber availability, MFN will use commercially
reasonable efforts to honor Carrier's requests for fiber in excess of
*** strands along any MFN network ring. In no event shall MFN be
required to lease to Carrier more than *** fiber strands in any single
MFN network ring.
9.4 Carrier may request that MFN add the following wire centers to any
Leased Fiber in the applicable metropolitan area:
CHCGILWB, CHCGILLR, CHCGILID, CHCGILSU, CHCGILSU, CHCGILFR, CHCGILCL,
NYCMNY13, NYCMNY18, NYCMN30, NYCMNY36, NYCMN37, NYCMN42, NYCMN50, NYCMN56,
NYCMN79, NYCMNBS, NYCMNVS, NYCMNYWS, JRCYNJBR, LSANCA02, LSANCA03,
LSANCA04, LSANCA07, LSANCA10, LSANCA11, XXXXXX00, XXXXXX00, XXXXXX00,
XXXXXX00, PHLAPALO, PHLAPAPE, PHLAPATR, PHLAPAEV, PHLAPAMK, WASHDCMT,
WASHDCMO, WASHDCDN, WASHDCSW, BSTNMABE, BSTNMABO, BSTNMAHA, BSTNMAFR,
CMBRMABE, DLLSTXRI, DLLSTXTA, DLLSTXRO, DLLSTXLA
There shall be *** installation charge for the addition of each wire
center.9.5 Carrier may request that MFN add the following Carrier locations
for the indicated one time installation charge:
--------------------------------------------------------------
Carrier Location Non-recurring
Price
--------------------------------------------------------------
Focal Communications Corp., of Illinois
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of Illinois
0000 X. Xxxxxxxxx Xxxx
Xxx Xxxxx Xxxxxxxx, Xxxxxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of New York
Financial Square
00 Xxx Xxxx, Xxxxx # 000
Xxx Xxxx, Xxx Xxxx 00000 $ ***
--------------------------------------------------------------
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
--------------------------------------------------------------
Focal Communications Corp., of Pennsylvania
Mellon Independence Center
000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of Washington D.C.
0000 Xxxxxxx Xxxxxx, XX., Xxxxxxx Xxxxx
Xxxxxxxxxx, X.X. 00000-0000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of California
The Garland Center
0000 Xxxx 0xx Xxxxxx #X0,000
Xxx Xxxxxxx, Xxxxxxxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of California
Xxxxxxxx Xxxxxx
000 Xxxxxxxx, Xxxxx 000 $ ***
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
--------------------------------------------------------------
Focal Communications Corp., of Washington
0000 0xx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of Massachusetts
Riverfront Office Park
One Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., Texas
INFOMART
0000 Xxxxxxxx Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000 $ ***
--------------------------------------------------------------
Focal Communications Corp., of New Jersey
One Evertrust Plaza, 17th Floor
Xxxxxxxxxxx Xxxxxxxx Dr. and Xxxxxxxxxx Xx.
Xxxxxx Xxxx, Xxx Xxxxxx 00000 $ ***
--------------------------------------------------------------
9.6 For a period of thirty-six (36) months after the effective date of
this Agreement and provided Carrier is not in any material breach of
this Agreement, this Agreement is in full force and effect, and
Carrier has leased and continues to lease at least twenty five hundred
(2,500) fiber miles within twelve (12) months of the effective date of
this Agreement pursuant to the terms and conditions of this Agreement,
the price for each additional fiber mile that MFN leases to Carrier on
MFN Networks shall be determined in as follows:
Incremental
$/Fiber Mile/
Fiber Mile Month
----------------------------
2,501- 3,750 $***
---------------------------
3,751- 5,000 $***
---------------------------
5,001- 6,250 $***
---------------------------
6,251- 7,500 $***
---------------------------
7,501- 8,750 $***
---------------------------
8,751-10,000 $***
---------------------------
10,001-11,250 $***
---------------------------
11,251-12,500 $***
---------------------------
12,501-13,750 $***
---------------------------
13,751-15,000 $***
---------------------------
15,001-16,250 $***
---------------------------
16,251-17,500 $***
---------------------------
17,501-18,750 $***
---------------------------
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
----------------------------
18,751-20,000 $***
----------------------------
20,001-21,250 $***
----------------------------
21,251-22,500 $***
----------------------------
22,501-23,750 $***
----------------------------
23,751-25,000 $***
----------------------------
25,001-26,250 $***
----------------------------
26,251-27,500 $***
----------------------------
27,501-28,750 $***
----------------------------
28,751-30,000 $***
----------------------------
Greater than 30,000 $***
----------------------------
9.7 Provided Carrier is not in any material breach of this Agreement, this
Agreement is in full force and effect, and Carrier has leased and
continues to lease at least *** fiber miles within thirty-six (36)
months of the effective date of this Agreement, then MFN will extend
the pricing set forth in Section 9.6 above for one additional thirty-
six (36) month period.
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
10. MFN address (and contact person) is as follows:
Metromedia Fiber Network Services, Inc.
Xxx Xxxxx Xxxxxxxxx Xxx., Xxxxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attn.: Vice President - Marketing
For purposes of declaring a default or termination, a copy of the
notice must be sent to:
Vice President - Legal Affairs
Metromedia Fiber Network Services, Inc.
Xxx Xxxxx Xxxxxxxxx Xxx., Xxxxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
Carrier address (and contact person) is as follows:
Focal Financial Services, Inc.
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Chief Operating Officer
For purposes of declaring a default or termination, a copy of the
notice must be sent to:
General Counsel
Focal Financial Services, Inc.
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Metromedia Fiber Network Services, Inc. Focal Financial Services, Inc.
By: /s/ Xxxxxxxx X. Xxxxx By: /s/ Xxx Xxxxxxxxxx
---------------------- ----------------------------
Xxxxxxxx X. Xxxxx Xxx Xxxxxxxxxx
Vice President Vice President
Fiber Optic Private Network Agreement
-------------------------------------
General Terms and Conditions
1. TERM AND LEASE
--------------
1.1 MFN hereby leases to Carrier optical fiber ("Leased Fiber") on MFN's fiber
optic cable network ("Network") and/or constructed and installed
specifically for Carrier and the equipment and interfaces described in the
Product Order ("Equipment"), as provided in the Product Order. The Leased
Fiber and Equipment leased by Carrier will be referred to as the "Product".
The lease term ("Lease Term") and other specific terms pertaining to the
Product are set forth in the Product Order. The term "Party" will refer,
individually, to either MFN or Carrier and the term "Parties" will refer to
both of them. The term "Agreement" will mean and include the Product Order
and all Exhibits thereto and these General Terms and Conditions.
1.2 MFN will use commercially reasonable efforts to complete installation of
and provide Carrier with access to the Product on or about the Estimated
Installation Completion Date specified in the Product Order at the
Locations specified in the Product Order ("Turnover Date"). For a period of
time not to exceed ten (10) business days after the Turnover Date (the
"Acceptance Test Period"), Carrier will conduct such testing as it
reasonably deems necessary to ensure that the Product conforms in all
material respects to the material technical specifications set forth in the
relevant Exhibits ("Specifications"). Carrier will use commercially
reasonable efforts to complete such acceptance testing and notify MFN in
writing within five (5) business days after the Turnover Date, but in any
event within the Acceptance Test Period, of acceptance or of any
"Deficiencies" (as defined herein) in the Product. Deficiencies exist if
the Product does not conform in all material respects to the relevant
Specifications. Upon receipt of such notification from Carrier, MFN will
promptly undertake correction of such Deficiencies and restore access to
and use of the Product to Carrier. The "Service Date," whereupon the Lease
Term commences, will be the earlier of (i) completion of testing and
acceptance of Product by Carrier, (ii) expiration of the Acceptance Test
Period or, (iii) if Carrier has identified Deficiencies, then the first
date upon which Product conforms in all material respects with the relevant
Specifications.
1.3 Carrier will obtain all necessary approvals for access into the Location
buildings from the building entry point and for the use of any required
building riser conduit or other required building facilities at all
Locations. MFN will obtain all necessary approvals for access from the MFN
Network to the applicable Location buildings up to the building entry
point. Unless otherwise provided for in the Product Order, if there is no
existing and available riser conduit or other required facilities within
such buildings then MFN will perform all construction and installation of
such riser conduit and Carrier will reimburse MFN for the entire cost to
construct and install such riser conduit *** plus applicable sales or other
taxes.
1.4 Upon the expiration of the Lease Term, or any earlier termination of this
Agreement, Carrier will promptly remove from any property owned, leased or
licensed by MFN all Carrier property, equipment and other materials used in
connection with the Product within forty five (45) days from such
expiration or termination. Carrier will complete such removal in a manner
that does not interfere with or damage the Product or the Network. If
Carrier fails to remove its property within such period, such property will
be deemed abandoned, and MFN will make such disposition of the property as
it deems necessary or advisable at Carrier's sole expense.
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
2. TERMS OF PAYMENT
----------------
2.1 Unless otherwise provided for in the Product Order, Carrier agrees to pay
the One Time Installation Charge upon the execution of this Agreement.
Carrier will also pay to MFN all applicable sales or other taxes other than
taxes on or measured by MFN's income or capital, ("Applicable Taxes"),
unless Carrier is eligible for an exemption and Carrier provides to MFN an
exemption certificate or other documentation. Commencing on the Service
Date for each Ring or segment thereof and continuing each month thereafter
for the duration of the Lease Term, Carrier will pay the Monthly Lease
Payment (and the Monthly Maintenance Payment for the Equipment, if
applicable) plus Applicable Taxes in advance for each month. If service
commences after the first day of any month or terminates before the last
day of a month, then the payment for such partial month will be pro rated
based on the number of days of the Lease Term during that month to the
number of days in that month. Carrier will include such pro rata payment
for the initial partial month in the first monthly payment at the
commencement of the Lease Term. The Prepaid Lease Payment, if any, will be
paid as provided in the Product Order.
2.2 A portion equal to *** of the Monthly Lease Payment for the Leased Fiber
and any payment pursuant to the Collocation License, if any, (together, the
"Payment") will be increased (but not decreased) each year during the Lease
Term by the percentage increase, if any, in the Consumer Price Index -Urban
Wage Earners and Clerical Workers (U.S. City Average, All Items, Base 1982-
1984 equals 100) (the "Index"), as published by the United States
Department of Labor, Bureau of Labor Statistics (the "Bureau"). The Index
for the calendar month which is four (4) months prior to the Service Date
will be compared with the Index for the calendar month which is four (4)
months prior to each anniversary of the Service Date during the Lease Term
and the Payment will be increased in accordance with the percentage
increase, if any, between such Indexes.
2.3 If Carrier fails to pay any sum that is not disputed in good faith and in
writing when due pursuant to this Agreement, then, in addition to such sum,
Carrier will pay interest on such unpaid sum at the lower of the highest
legal rate of interest permitted in the State of New York or one and one-
half percent (1.5%) per month.
3. MAINTENANCE, RESTORATION AND REPAIR OF THE NETWORK AND PRODUCT MONITORING
-------------------------------------------------------------------------
3.1 MFN will provide remote monitoring of the Network and the Product to the
extent that the Product is incorporated into the Network. MFN will use
commercially reasonable efforts to maintain the Product in accordance with
the Specifications (subject to reasonable wear and tear) and the Network in
good operating condition at all times during the Lease Term. The foregoing
maintenance will be at no additional charge to Carrier, except as set forth
in Section 3.4 hereof.
3.2 An "Outage" will mean the complete interruption of communications or any
other material degradation of service on one or more of Carrier's Leased
Fibers resulting from physical damage to, or severance of, or a break in,
or other failure of any Product. If an Outage on any Leased Fibers occurs
Carrier will immediately notify MFN by telephone at (000) 000-0000 or
through such other notification procedure as Parties may establish.
Provided that MFN personnel or contractors have access to affected Carrier
facilities immediately upon notification, MFN will respond and commence
work within two (2) hours after the time of notification by Carrier and
restore effective use of the Product as expeditiously as practicable, but
in no event more than four (4) hours after receipt by MFN of Carrier's
notification, subject to "Force Majeure" as provided in Section 11 hereof.
3.3 Except for any Outage caused by or resulting from (i) Force Majeure as set
forth in Section 11 hereof; (ii) the act or omission of Carrier, its
employees, agents or contractors; (iii) any of
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
Carrier's equipment or facilities used in connection with the Product;
or (iv) planned Outages by reason of Services which have been
scheduled and approved in advance by Carrier ("Excepted Outages") in
the event of an Outage, Carrier will receive from MFN a credit
("Outage Credit") calculated at *** of the Leased Fiber Monthly Lease
Payment for the affected Leased Fiber strands for each four (4) hours
of Outage, up to a maximum of the Leased Fiber Monthly Lease Payment
for one (1) full month per Outage. Except in the case of a Prepaid
Lease Payment or termination as provided in this Section 3.3, the
Outage Credit will be applied against future payments which may become
due and payable by Carrier to MFN. The Outage Credit will be
determined by dividing the total Leased Fiber Monthly Lease Payment by
the number of Locations and dividing this result by the number of
Leased Fiber strands to determine the Leased Fiber Monthly Lease
Payment per Leased Fiber Strand. This result is then multiplied by ***
and by the number of four (4) hour Outage periods. For example, if the
Leased Fiber Monthly Lease Payment for six (6) Locations is
$60,000.00, the Leased Fiber Monthly Lease Payment for each Location
would be $10,000.00, and if there were four (4) Leased Fiber strands
for each Location, the result would be $2,500.00 per Fiber Strand. If
the Outage affected two (2) strands at one Location for eight (8)
hours, the Outage Credit would be $2,500 ***. The Outage Credit will
be in the form of a cash payment to Carrier by MFN if this Agreement
is terminated by either Party as provided in Section 3.4 hereof.
Outage Credits will not be credited or payable for any period of time
during which MFN personnel or contractors are denied access to Carrier
Locations or other facilities to remedy an Outage.
3.4 If an Outage occurs and continues for a period longer than four (4)
days for any reason other than "Force Majeure" as defined in this
Agreement, then at any time thereafter, unless and until such Outage
is corrected, either Party can terminate this Agreement and the
Product Order with respect to the Product subject to the Outage by
written notice of such termination delivered to the other Party. If
there are Outages that occur for a cumulative period of longer than
three hundred sixty (360) hours in any thirty-six (36) month period
for any reason other than "Force Majeure" (as defined in this
Agreement), then at any time thereafter, unless and until the such
Outage is corrected, either Party can terminate this Agreement and the
Product Order with respect to the Product subject to the Outage by
written notice of such termination delivered to the other Party.
Notwithstanding the foregoing, if such Outage occurs and continues by
reason of a breach by a Party of its obligations under this Agreement,
such breaching Party will not have any right to terminate this
Agreement. The Outage Credit and right to terminate will be the sole
and exclusive remedy of Carrier and liability of MFN for any Outage
regardless of the cause of such Outage.
3.5 If all or part of the Product requires restoration, replacement or
repair by reason of an act or omission of Carrier, its employees,
agents, or contractors or any of Carrier's equipment or facilities
used in connection with the Product, such repair, replacement and/or
restoration will be made by MFN, at Carrier's sole expense, in
accordance with MFN's then current time and materials rates plus
Applicable Taxes. In addition, Carrier will not receive any Outage
Credit by reason of the foregoing.
3.6 MFN may assign or subcontract to any third party its performance
obligations (including maintenance) under this Agreement and Product
Order at any time, without the consent of Carrier, provided that MFN
will remain obligated for such performance in accordance with the
terms of this Agreement.
3.7 MFN will have the right to inspect Carrier's use of the Product for
maintenance and monitoring purposes at any time and from time to time
during normal business hours upon at least twenty-four (24) hours
prior notice by MFN.
4. USE AND OWNERSHIP OF THE PRODUCT
--------------------------------
***Portions of this exhibit have been omitted pursuant to a request for
confidential treatment, and the ommitted portions have been filed
separately with the Securities and Exchange Commission.
4.1 Carrier will not, by itself or through any agent or contractor, make
any repair to or replacement of the Product or the Network or any
other equipment or facilities provided by MFN in connection with the
Product or otherwise. Carrier will not install any equipment to be
used with the Product or use the Product in any manner which damages
or interferes with the Product or the Network.
4.2 Carrier will use the Product in full compliance with all applicable
federal, state and local laws, rules and regulations and all
applicable franchises, rights of way, leases, licenses, contracts and
other obligations to third parties with respects to the Network or
Product. Carrier will obtain and maintain in effect during the Lease
term all rights, leases, licenses, permits and governmental or non-
governmental approvals necessary for use of the Product by Carrier and
its customers.
4.3 Carrier acknowledges and agrees that the Product is provided for use
(1) exclusively by Carrier and/or affiliated entities which control or
are controlled by or commonly controlled with Carrier ("Affiliates"),
(2) customers of Carrier and (3) in either case only in the ordinary
course of business of Carrier. For purposes of this Agreement, the
ordinary course of Carrier's business shall not include the sale,
leasing or granting of any rights of use in "dark fiber", as such term
is commonly understood in the telecommunications industry. Carrier
will not under any circumstances (a) permit or provide access to or
use of the Product, in whole or part, to any third party (other than a
customer of Carrier in the ordinary course of business of Carrier),
pursuant to (by way of example and not in limitation) sublease,
license, sublicense or resale, or any other right to use, or (b) share
or otherwise utilize in conjunction with a third party (including
without limitation in any joint venture or as part of any outsourcing
activity) any of the Product. Any breach of this Section 4.3 will be
deemed to be a material breach of this Agreement and in the event of
such material breach MFN will have the right to immediately terminate
this Agreement, any applicable Product Orders and Carrier's access to
the Network, in addition to any and all rights and remedies.
4.4 MFN retains all right, title and interest in and to the Product and
the Network to the points within the locations specified in the
Product Order at which MFN's facilities end and Carrier's facilities
begin, subject only to the grant of access and use provided to Carrier
pursuant to this Agreement.
4.5 MFN reserves the right to utilize unused external building access and
space within the building conduit(s) occupied by the Product at the
locations and otherwise, provided that such use does not interfere
with or hinder Carrier's use of its Product as permitted hereunder.
4.6 MFN agrees not to use the Product for the purposes of transmission of
communications or any other electro-optical use.
4.7 MFN shall keep the Product and the Network free from any liens, rights
or claims of any third party attributable to MFN which may materially
and adversely affect the right of Carrier to use the Product
hereunder; provided, however, that MFN may pledge the Network so long
as MFN uses commercially reasonable efforts to obtain a non-
disturbance agreement in favor of Carrier.
4.8 MFN and Carrier shall promptly notify each other of any matters
pertaining to, or the occurrence (or impending occurrence) of, any
event of which it is aware that could give rise to any damage or
impending damage to or loss of the Product or Network.
4.9 MFN and Carrier agree to cooperate with each other in complying with
any requirements applicable to their respective rights and obligations
hereunder by any Governmental Authority.
5. AUTHORIZATIONS; RELOCATION; CONDEMNATION
----------------------------------------
5.1 "Authorization(s)" will mean all material and applicable governmental
or non-governmental licenses, easements, rights of way, conduit, pole
attachment and any other facilities or property rights, licenses,
contracts, franchises, approvals, permits, orders, consents, and all
other rights required for MFN to operate and maintain the Network or
provide the Product to Carrier pursuant to this Agreement.
5.2 MFN will use commercially reasonable efforts to have or obtain by the
Service Date, all Authorizations and to maintain or renew all such
Authorizations through the Initial Term and to replace such
Authorizations with reasonably suitable replacement Authorizations if
any expire or are terminated or discontinued during the Initial Term.
If any Authorizations are modified, terminated or discontinued and not
replaced, and the loss of such Authorizations threatens to cause or
does cause material financial harm to MFN, or prevents or materially
interferes with MFN's control, possession and/or use of the Network or
ability to lease the Product or materially and adversely affects the
use by Carrier of the Product, then MFN will at its option either (i)
provide Carrier with comparable Product or fiber optic capacity on
portions of MFN's then existing Network (and/or other MFN Networks,
including networks belonging to or controlled by MFN Affiliates) or on
networks of third parties, or (ii) terminate this Agreement with
respect to the affected Product and rebate to Carrier the pro rata
portion of all Prepaid Lease Payments allocable to the terminated
Product and amortized over the remainder of the Lease Term. The
foregoing will be MFN's sole and exclusive liability and Carrier's
sole and exclusive remedy with respect to the foregoing.
5.3 If MFN receives notice of any request, intent or plan by any
governmental or non-governmental third party, to relocate any material
part of the Product or any material segment of MFN's Network used in
the provision of the Product, MFN will notify Carrier of such request,
intent, or plan. If MFN is required by any such third party to
relocate any segment of MFN's network used in providing the Product,
MFN will give Carrier at least sixty (60) days (or such lesser period
of notice that MFN may have received) prior written notice of any such
relocation ("Relocation Notice"). Together with the Relocation Notice,
MFN will provide an estimate of the cost of such relocation. MFN will
relocate the Leased Fibers, and, to the extent MFN is not reimbursed
for the cost of such relocation by a third party, governmental entity
or otherwise, Carrier will pay its pro rata share of the costs
associated with the relocation of the Product; except, however, to the
extent that such relocation is the direct result of any negligent or
willful act or omission of MFN. MFN will use its commercially
reasonable efforts to secure an agreement for reimbursement from any
third party, governmental entity or otherwise, requiring any
relocation of the Network and the Product. Notwithstanding the
foregoing, in the event that MFN is required to relocate the Product
or the Network, and further provided that MFN requires Carrier to pay
its pro rata share of the costs associated with such relocation, then
Carrier shall have the right, by delivery of written notice to MFN no
later than fifteen (15) days after Carrier is notified by MFN of such
relocation and Carrier's requirement to pay its pro rata share of such
relocation, (i) to elect to terminate the Term with respect to the
affected segment of the Product, (ii) not to pay any allocated share
of the costs associated with the relocation of such Product or
Network, and (iii) not be required to pay any early termination fees
in connection with the affected segment. Moreover, if such relocation
shall cause any Locations to be dropped from any Ring, then Carrier
shall have the same right to terminate the Term in accordance with
this section.
5.4 If any portion of the Network or the Product and/or the Authorizations
in or upon which the Product has been installed, become the subject of
a condemnation proceeding which is not dismissed within one hundred
eighty (180) days after the date of filing of such proceeding and
which could reasonably be expected to result in a taking by any
governmental agency
or other party having the power of eminent domain for public purpose or
use, both Parties will be entitled, to the extend permitted under
applicable law, to participate in any condemnation proceedings for
compensation by either joint or separate awards for the economic value of
their respective interests in the Leased Fibers that are subject to such
condemnation proceeding.
6. WARRANTIES
----------
6.1 MFN warrants to Carrier that upon the Service Date Product will operate in
accordance with the Specifications related thereto.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, MFN
DISCLAIMS ALL WARRANTIES WHETHER EXPRESS OR IMPLIED INCLUDING ANY AND
ALL WARRANTIES OF MENCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE
WITH RESPECT TO THE (i) NETWORK OR PRODUCT, (ii) THE LEASE GRANTED
PURSUANT HERETO, (iii) MAINTENANCE SERVICES (iv) CONSTRUCTION AND
INSTALLATION SERVICES, IF ANY, AND (v) ANY OTHER SERVICE(S)
(HEREINAFTER (iii) THROUGH (v) WILL COLLECTIVELY BE REFERRED TO AS
"SERVICES") PROVIDED BY OR ON BEHALF OF MFN HEREUNDER.
7. LIABILITY/INDEMNIFICATION
-------------------------
7.1 Except for the gross negligence or willful misconduct of a Party hereto and
except where a specific remedy is provided in this Agreement, the liability
of each Party to the other Party for damages will be limited to the total
Installation Charges and the Monthly Lease Payments paid or payable by
Carrier for the Lease Term during which the damages were incurred. In no
event will either Party be liable to the other Party for any incidental,
indirect, special, consequential, exemplary, or punitive damages arising
out of or relating to this Agreement, the lease granted hereunder, the
Network, Product or Services provided hereunder, including damages based on
loss of revenues, profits or lost business opportunities, regardless of
whether the respective Party had been advised of or could have foreseen the
possibility of such damages.
7.2 Each Party agrees to indemnify, defend and hold the other, its officers,
directors, employees, agents and contractors harmless from and against all
loss, damage, liability, cost and expense (including reasonable attorney's
fees and expenses) by reason of any claims or actions by third parties for
(i) bodily injury, including death, (ii) damage, loss or destruction or any
real or tangible personal property (including without limitation the
Network and Product) which third party claims arise out of or relate to (a)
any Product or Services provided by or on behalf of MFN hereunder, (b) a
Party's performance of or failure to perform any term, condition or
obligation under this Agreement, (c) any act or omission of a Party's
directors, agents, employees, contractors, representatives or invitees, or
(d) Carrier's or its customer's use of the Product and conduct of their
respective businesses including without limitation the content of any
video, voice or data carried by Carrier or its customers on the Product or
Network.
7.3 Except as otherwise set forth in this Agreement, nothing contained herein
will operate as a limitation on the right of either Party to bring an
action for damages against any third party based on any act or omission of
such third party as such act or omission may affect the construction,
operation, or use of the Product. Each Party agrees to execute such
documents and provide such commercially reasonable assistance, at the
claiming Party's sole expense, as may be reasonably necessary to enable the
claiming Party to pursue any such action against such third party.
8. CONFIDENTIALITY
---------------
8.1 The Parties acknowledge and agree that this Agreement and the information
each Party has provided or will provide in connection with this Agreement
or that the other Party learns or obtains from a source other than public
domain or from a source (including a Party) not in violation of any
obligation of confidentiality, are and will be confidential and proprietary
to the Party providing such information (the "Providing Party"). The Party
in receipt of or learning or obtaining the confidential information (the
"Receiving Party") agrees not to distribute, use or disclose to any third
party the confidential information of the Providing Party.
8.2 Except as may be required by applicable legal requirements in the course of
defending or prosecuting a legal, insurance or other claim or as required
by applicable law, rule or regulation, Receiving Party will restrict
dissemination of confidential information to only those persons who must
have access to such confidential information in order to perform their
respective rights or obligations hereunder. The Receiving Party will
promptly notify the Disclosing Party of any such required disclosure to
enable the Disclosing Party to seek protective relief therefrom and shall
cooperate as the Disclosing Party may request in connection therewith.
8.3 Carrier may disclose the identity of MFN as a supplier of Carrier, and MFN
may disclose the identity of Carrier as customer of MFN; provided, that no
such disclosure shall imply any endorsement of the disclosed Party or
contain any misleading reference to the nature of the relationship between
the Parties.
8.4 Each Party acknowledges and agrees that the information of the Disclosing
Party described in this Section 8 constitutes valuable property of the
Disclosing Party and that Disclosing Party will suffer irreparable injury
not compensable by money damages for which the Disclosing Party will not
have an adequate remedy at law in the event of a breach by the Receiving
Party of the provisions of this Section 8 and therefore the Disclosing
Party shall be entitled to injunctive relief to prevent or curtail any such
breach, threatened or actual. The foregoing shall be without prejudice to
or limitation on any other rights a Party may have under this Agreement, at
law or in equity.
9. NOTICES
-------
Unless otherwise provided herein, all notices and communications concerning this
Agreement will be in writing and sent to the address (and contact person)
specified in the Product Order, or at such other address as may be designated in
writing by a Party. Unless otherwise provided herein, notices will be sent by
certified U.S. Postal Service, return receipt requested, or by commercial
overnight delivery service, or by facsimile, and will be presumed delivered, if
sent by US Postal Service, five (5) days after deposit, if sent by facsimile,
upon verification of receipt or, if sent by commercial overnight delivery
service, one (1) business day after deposit therewith.
10. RENEWAL TERM
------------
Provided that Carrier is not in breach of any of its material obligations under
this Agreement and subject to the conditions of this Agreement, Carrier may
renew the term of this Agreement for the Product for one (1) additional renewal
term upon the terms and conditions of this Agreement, except for the length of
such renewal term and the Installation and Lease Fee payments, which the Parties
will negotiate in good faith following Carrier's written request for renewal
delivered to MFN no earlier than one year before the scheduled expiration date
of the initial term and no later that ninety (90) days before such expiration
date.
11. TERMINATION/FORCE MAJEURE
-------------------------
11.1 If any of the following events of default occur, the non-breaching Party
(if MFN) will have the right to deny access by Carrier to the Product or
Network and (if either Party) to terminate this Agreement by written notice
following the expiration of any periods of time included in
the following, such termination to be effective in the on the date set
forth in the written notice of termination:
11.1 (a) If Carrier terminates any Product Order at any time before the
expiration of the Lease Term (whether before or after the Turnover
Date) or fails to make any payment hereunder which is not disputed
in good faith and in writing within five (5) days or receipt of
written notice of late payment from MFN, MFN will have the right
to terminate this Agreement and deny access by Carrier to the
Product or Network immediately without further notice to Carrier.
11.1 (b) If a Party breaches any material term or condition of this
Agreement and such breach remains uncured thirty (30) days after
delivery to the breaching Party of written notice of such breach,
unless the breach is of a nature or involves circumstances
requiring more than thirty (30) days to cure, the time period may
be extended for such time as will be reasonably required, provided
the defaulting party proceeds diligently to cure the breach.
11.1 (c) A Party applies for or consents to the appointment of a receiver,
trustee or similar officer for it or any substantial part of its
property or assets, or any such appointment is made without such
application or consent by such Party and remains undischarged for
a period of sixty (60) days; or
11.1 (d) A Party consents to the institution of a petition, application,
answer, consent, default of otherwise of any bankruptcy,
insolvency or reorganization and any such proceeding as instituted
against such Party remains undischarged for a period of sixty (60)
days.
11.2 In the event of termination of the Product Order by MFN pursuant to Section
11.1 hereof or by Carrier after execution of the Product Order or before
the end of the Lease Term (other than by Carrier for cause as provided in
this Section 11), MFN will be entitled to receive, and Carrier will
immediately pay, the early termination charge ("Early Termination Charge")
set forth in the Product Order, and to offset any remaining portion of the
Prepaid Lease Payment against any sums otherwise due and payable by Carrier
to MFN pursuant to this Agreement.
11.3 If any Authorization is modified, terminated or discontinued and not
replaced as provided in Section 5.2 of these General Terms and Conditions,
and MFN has not notified Carrier in writing within thirty (30) days after
the occurrence of such modification, termination or discontinuance that MFN
will provide additional or substitute Product or capacity as provided in
Section 5.2, then and thereafter either party has the right, exercisable in
its sole discretion, to terminate the Product Order with respect to the
affected Product upon thirty (30) days prior written notice (or such other
notice as is practicable under the circumstances) without liability
whatsoever by either Party to the other Party or any party claiming by,
through or under such other Party other than the return to Carrier, of the
unamortized portion of any Prepaid Lease Payment as of the date of such
termination as provided in Section 5.2.
11.4 Neither Party will be in breach of this Agreement resulting from delay or
prevention of performance of such Party which is caused by any act
attributable to an occurrence or an event of "Force Majeure" as defined
herein. Neither party will, however, be relieved of liability for failure
of performance due to a claimed Force Majeure hereunder if such failure is
due to causes arising out of its own negligence or to removable or remedial
causes that it fails to remove or remedy using commercially reasonable
efforts and within a reasonable period of time.
11.5 The term "Force Majeure" will mean any cause beyond the control of Carrier
(or MFN, as applicable) which, by the exercise of due foresight, Carrier
(or MFN) could not reasonably
have been expected to avoid, and which by the exercise of reasonable
diligence, Carrier (or MFN) will be unable to overcome, including but not
limited to action by governmental authority including without limitation
moratorium on any activities related to the Agreement, third party labor
dispute, flood, earthquake, fire, lightning, epidemic, war, riot, civil
disturbance, sabotage (not caused by MFN or any of its affiliates,
employees or contracted third parties) and the like. The party affected by
an event of Force Majeure (the "Affected Party") will notify the other
party (the "Other Party") promptly of any occurrence or condition which, in
the Affected Party's reasonable opinion, warrants an extension of time.
Such notice will specify in detail the anticipated length of delay, the
cause of the delay and a timetable by which any remedial measures will be
implemented.
12. ASSIGNMENT; SUCCESSION
----------------------
12.1 Neither party shall assign this Agreement to any other party without the
prior written consent of the other Party, which consent shall not be
unreasonably withheld or delayed; provided, however, that each Party shall
have the right, without the other Party's consent, but with prior written
notice to the other Party, to assign this Agreement to any entity
controlling, controlled by or under common control with such Party. Upon
any permitted assignment hereunder, the assignee will remain jointly and
severally responsible for the performance under this Agreement, unless
released in writing by the other Party. Any permitted assignee will
expressly assume all liabilities hereunder prior to the effectiveness of
such assignment. Any attempted assignment without such consent will be null
and void and may be deemed by the other Party, in its sole discretion, to
constitute a material breach of this Agreement.
12.2 The Agreement and Product Order will be binding upon and inure to the
benefit of the Parties hereto and their respective successors and permitted
assigns.
13. GOVERNING LAW
-------------
13.1 THIS AGREEMENT WILL BE INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE 0F NEW YORK WITHOUT GIVING EFFECT TO ITS
PRINCIPLES OF CONFLICTS OF LAWS.
14. SURVIVAL
--------
The Parties' respective representation, warranties, and covenants, together with
obligations of indemnification, confidentiality and limitations on liability
will survive the expiration, termination or rescission of this Agreement and
continue in full force and effect.
15. ENTIRE AGREEMENT
----------------
This Agreement, Product Order, Exhibits and all addenda attached hereto
constitute the entire agreement between the parties hereto with respect to the
subject matter hereof and supersede any and all prior negotiations,
understandings, and agreement with respect hereto, whether oral or written.
16. REMEDIES CUMULATIVE
-------------------
Except as otherwise expressly provided, the rights and remedies set forth in
this Agreement will be in addition to, and cumulative of, all other rights and
remedies at law or in equity.
17. REPRESENTATIONS, WARRANTIES AND COVENANTS
-----------------------------------------
Each Party represents, warrants and covenants to the other that (a) it is a
corporation, limited liability company, partnership, or other legal entity, duly
organized, validly existing and in good standing under the laws of the state of
its organization, (b) it has all requisite power and authority
to enter into and perform its obligations under this Agreement and Product Order
and (c) this Agreement, when executed, will become the legal, valid and binding
obligation of such Party.
18. MISCELLANEOUS
-------------
18.1 The covenants, undertakings, and agreements set forth in this Agreement
will be solely for the benefit of and will be enforceable only by the
Parties hereto or their respective successors or permitted assigns.
18.2 The headings of the Sections in this Agreement are strictly for convenience
and will not in any way be construed as amplifying or limiting any of the
terms, provisions or conditions thereof.
18.3 In the event any term of this Agreement will be held valid, illegal or
unenforceable, in whole or in part, neither the validity of the remaining
part of such term nor the validity of the remaining terms of this Agreement
will be in any way affected thereby.
18.4 This Agreement may be amended only by a written instrument executed by the
Parties.
18.5 No failure to exercise and no delay in exercising, on the part of either
Party hereunder, any right, power or privilege hereunder will operate as a
waiver hereof, except as expressly provided herein.
18.6 This Agreement may be executed in multiple counterparts, each of which will
constitute one and the same instrument.
