{"id":42700,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/project-development-and-construction-contract-tyco-submarine.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"project-development-and-construction-contract-tyco-submarine","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/project-development-and-construction-contract-tyco-submarine.html","title":{"rendered":"Project Development and Construction Contract &#8211; Tyco Submarine Systems Ltd. and GCT Pacific Holdings Ltd."},"content":{"rendered":"<pre>\n                                                                  EXECUTION COPY\n\n\n                     _____________________________________\n\n                                     PC-1\n\n                     _____________________________________\n\n\n\n                              PROJECT DEVELOPMENT\n\n                                      AND\n\n                             CONSTRUCTION CONTRACT\n\n                                    BETWEEN\n\n                          TYCO SUBMARINE SYSTEMS LTD.\n\n                                      AND\n\n                          GCT PACIFIC HOLDINGS, LTD.\n\n\n\n                     _____________________________________\n\n                          DATED AS OF APRIL 21, 1998\n\n                     _____________________________________\n\n \n                               TABLE OF CONTENTS\n\n                         GENERAL TERMS AND CONDITIONS\n\n\n\nArticle                                                              PAGE\n-------                                                              ----\n                                                                  \n1     Provision of System...........................................   1\n\n2     Documents Forming the Entire Contract.........................   2\n\n3     Definitions...................................................   2\n\n4     Contract Price................................................  12\n\n5     Terms of Payment by Purchaser.................................  16\n\n6     Contract Variations...........................................  18\n\n6A.   Optional Upgrades.............................................  19\n\n7     Responsibilities for Permits..................................  22\n\n8     Route Survey..................................................  23\n\n9     Acceptance....................................................  24\n\n10    Warranty......................................................  28\n\n11    Contractor Support............................................  32\n\n12    Purchaser's Obligations.......................................  32\n\n13    Termination for Default.......................................  33\n\n14    Termination for Convenience...................................  35\n\n15    Suspension....................................................  37\n\n16    Title and Risk of Loss........................................  38\n\n17    Force Majeure.................................................  38\n\n18    Intellectual Property.........................................  39\n\n19    Infringement..................................................  45\n\n20    Safeguarding of Information and Technology....................  46\n\n\n                                       i\n\n \n\n\nArticle                                                              PAGE\n-------                                                              ----\n                                                                  \n21    Export Control................................................  47\n\n22    Liquidated Damages............................................  47\n\n23    Limitation of Liability\/Indemnification.......................  48\n\n24    Counterparts..................................................  50\n\n25    Design and Performance Responsibility.........................  50\n\n26    Product Changes...............................................  50\n\n27    Risk and Insurance............................................  50\n\n28    Plant and Work Rules..........................................  54\n\n29    Right of Access...............................................  54\n\n30    Quality Assurance.............................................  55\n\n31    Documentation.................................................  55\n\n32    Training......................................................  55\n\n33    Settlement of Disputes\/Arbitration............................  56\n\n34    Applicable Law................................................  58\n\n35    Notices.......................................................  58\n\n36    Publicity and Confidentiality.................................  59\n\n37    Assignment; Subcontractors....................................  59\n\n38    Relationship of the Parties...................................  61\n\n39    Successors Bound..............................................  61\n\n40    Article Captions..............................................  61\n\n41    Severability..................................................  61\n\n42    *.............................................................  61\n\n43    Survival of Obligations.......................................  61\n\n44    Non-Waiver....................................................  62\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n                                      ii\n\n \n\n\nArticle                                                              PAGE\n-------                                                              ----\n                                                                  \n45   Language.......................................................  62\n\n46    Entire Agreement..............................................  62\n\n47    Coming into Force.............................................  62\n\n\n\nEXHIBITS\n--------\n\n      Exhibit A ...................................................... *\n      Exhibit B .................................. Consent and Agreement\n      Exhibit C ..................................... Opinion of Counsel\n      Exhibit D ....................................... Escrow Agreement\n      Exhibit E ................................ Approved Subcontractors\n      Exhibit F .................................. Intellectual Property\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n                                      iii\n\n \n                            PROJECT DEVELOPMENT AND\n                             CONSTRUCTION CONTRACT\n                                    BETWEEN\n                        TYCO SUBMARINE SYSTEMS LTD. AND\n                          GCT PACIFIC HOLDINGS, LTD.\n\n           This Project Development and Construction Contract (\"Contract\") is\nmade as of this 21st day of April 1998 between Tyco Submarine Systems Ltd., a\ncorporation organized and existing under the laws of the State of Delaware,\nUnited States, (\"TSSL\" or \"Contractor\") and GCT Pacific Holdings, Ltd., a\ncompany organized and existing under the laws of Bermuda (hereinafter referred\nto as \"Purchaser\").\n\n           WHEREAS, Purchaser desires to establish a fiber optic submarine cable\nsystem, to be known as the Pacific Crossing 1 Submarine Cable System\n(hereinafter, and as more fully defined herein, the \"System\"), which will be\nused to provide service between the United States mainland and Japan; and\n\n           WHEREAS, the System will consist of the following Segments:\n\n           Segment N:  From Norma Beach, Washington, United States to Ajigaura,\n                       Japan;\n\n           Segment W:  From Ajigaura, Japan to Shima, Japan;\n\n           Segment S:  From Shima, Japan to Toro Creek, California, United\n                       States; and\n\n           Segment E:  From Toro Creek, California, United States to Norma\n                       Beach, Washington, United States; and\n\n           WHEREAS, Contractor is in the business of designing, constructing,\ninstalling, supplying, delivering and manufacturing fiber optic submarine cable\nsystems and is familiar with the general business of the fiber optic submarine\ncable system industry; and\n\n           WHEREAS, Purchaser seeks to purchase and own the System and wishes to\nengage Contractor to perform the Work and Upgrade Work; and\n\n           WHEREAS, Contractor is willing to perform the Work and the Upgrade\nWork on a turn-key, fixed-price basis in accordance with and subject to the\nterms hereof.\n\n           NOW THEREFORE, IT HAS BEEN AGREED AS FOLLOWS\n\nARTICLE 1  PROVISION OF SYSTEM\n------------------------------\n\n           In consideration of the Contract Price and the Upgrade Prices, the\nContractor agrees to undertake the Work and the Upgrade Work and to provide the\nPurchaser with the\n\n \n                                                                               2\n\nSystem meeting the System Performance Requirements on or before the Scheduled\nSystem RFS Date and the System Upgrades meeting the requirements of Article 6A,\nall in accordance with the terms hereof.\n\nARTICLE 2  DOCUMENTS FORMING THE ENTIRE CONTRACT\n------------------------------------------------\n\n           This Contract consists of these commercial Terms and Conditions,\nExhibits E and F hereto, and the following documents (in the form of\nattachments, including appendices, attached hereto), which shall be read and\nconstrued as part of the Contract:\n\n     .     Technical Volume (includes Route Information), Appendix 6\n     .     Plan of Work, Appendix 3, Upgrade Plan of Work, Appendix 3A\n     .     Provisioning Schedule, Appendix 1, Upgrade Provisioning Schedule,\n           Appendix 1A\n     .     Billing Schedule, Appendix 2, Upgrade Billing Schedule, Appendix 2A\n     .     Invoice Format, Appendix 4, Form of Contractor's Certificate,\n           Appendix 4A\n     .     Progress Schedule, Appendix 5\n\n           In the event of any inconsistency between the Terms and Conditions\nand the above listed documents, the Terms and Conditions shall prevail. The\nAppendices listed above have no order of precedence.\n\nARTICLE 3  DEFINITIONS\n----------------------\n\n           Definitions are as described in the specific Articles. Except as\notherwise defined the following definitions shall apply throughout the Contract:\n\n           AAA has the meaning set forth in Sub-Article 33(B).\n\n           ACCEPTANCE TESTING means (i) with respect to a Segment or the System,\n     the tests described in the Commissioning and Acceptance section of the\n     Technical Volume or developed pursuant to such section by mutual agreement\n     of the Parties (with 15 days prior notice to the Independent Engineer) and\n     reasonably designed to verify that such Segment or the System meets the\n     applicable Performance Requirements and (ii) with respect to any System\n     Upgrade, the tests described in the Commissioning and Acceptance section of\n     the Technical Volume or developed pursuant to such section by mutual\n     agreement of the Parties (with 15 days notice to the Independent Engineer)\n     and reasonably designed to verify that the System Upgrade meets the\n     applicable Performance Requirements.\n\n           ACCESS RIGHTS means all ownership, easement and\/or other property\n     rights, from both private and governmental entities, both on land and below\n     the surface of the water (including, without limitation, agreements to use\n     conduits, install manholes and to lease space in cable stations) necessary\n     to access, use and occupy cable stations and the sites for cable stations\n     (including, without limitation, to land and install the\n\n \n                                                                               3\n\n     submarine cable and related equipment and to bring such cable from the\n     ocean to the cable stations) in order for the Purchaser to own, operate and\n     maintain the System.\n\n          ACTUAL KNOWLEDGE means the actual knowledge of any executives with\n     management responsibility for the Contract.\n\n          ASSIGNMENT has the meaning set forth in Sub-Article 37(A).\n\n          BANKRUPTCY EVENT means an event specified in Sub-Article 13(A)(3) or\n     13(A)(4) with Contractor as the \"other Party\".\n\n          BILLING SCHEDULE means a billing schedule attached hereto as Appendix\n     2.\n\n          CERTIFICATE OF COMMERCIAL ACCEPTANCE means a certificate issued by\n     Purchaser in accordance with Sub-Article 9(D) to Contractor certifying that\n     a Segment, the System or a System Upgrade is Ready for Commercial\n     Acceptance.\n\n          CERTIFICATE OF FINAL ACCEPTANCE means a certificate issued by\n     Purchaser in accordance with Sub-Article 9(E) to Contractor certifying that\n     the System or a System Upgrade is Ready for Final Acceptance.\n\n          CERTIFICATE OF PROVISIONAL ACCEPTANCE means a certificate issued by\n     Purchaser in accordance with Sub-Article 9(C) to Contractor certifying that\n     a Segment, the System or a System Upgrade is Ready for Provisional\n     Acceptance.\n\n          CIF means cost, insurance and freight as defined in the International\n     Chamber of Commerce, Guide to Incoterms (1990).\n\n          COMMISSIONING REPORT has the meaning set forth in the Commissioning\n     and Acceptance section of the Technical Volume.\n\n          CONFIDENTIAL INFORMATION has the meaning set forth in Sub-Article\n     36(B).\n\n          CONSENT means a Consent and Agreement to be entered into among\n     Contractor, Purchaser and the financing parties described in Sub-Article\n     37(C) and substantially in the form of Exhibit B hereto, with such changes\n     therein as made pursuant to Sub-Article 37(C) hereto.\n\n          CONTRACT means this agreement, specifically consisting of the\n     documents described in Article 2, and shall be deemed to include any\n     amendments thereto or Contract Variations pursuant to Article 6 (Contract\n     Variations).\n\n          CONTRACTOR means the entity that has executed this Contract as\n     Contractor (TSSL) and that will be responsible for the performance of the\n     Work (and if applicable, Upgrade Work) under this Contract and shall\n     include its permitted successors and\/or assigns.\n\n \n                                                                               4\n\n          CONTRACT PRICE means the Initial Contract Price, plus any variations\n     pursuant to Article 6 (Contract Variations), Taxes as set forth in Sub-\n     Article 4(B) and other adjustments to the Contract Price provided for in\n     this Contract.\n\n          CONTRACT TAXES has the meaning set forth in Sub-Article 4(B)(1).\n\n          CONTRACT VARIATION has the meaning set forth in Sub-Article 6(A).\n\n          DATE OF COMMERCIAL ACCEPTANCE, PROVISIONAL ACCEPTANCE OR FINAL\n     ACCEPTANCE means the date that Purchaser receives a Commissioning Report or\n     an Upgrade Commissioning Report, as the case may be, demonstrating that a\n     Segment or the System or a System Upgrade, as the case may be, is Ready for\n     Commercial Acceptance, Ready for Provisional Acceptance or Ready for Final\n     Acceptance in accordance with Article 9 (Acceptance).\n\n          DDP means delivered duty paid as defined in the International Chamber\n     of Commerce, Guide to Incoterms (1990).\n\n          DEFAULT means an Event of Default or any event, condition or\n     occurrence which with the giving of notice or passage of time or both would\n     be an Event of Default.\n\n          DELIVERABLE SOFTWARE has the meaning set forth in Sub-Article 18(C).\n\n          DELIVERABLE TECHNICAL MATERIAL has the meaning set forth in Sub-\n     Article 18(B).\n\n          DISPUTE ACCOUNT means the Dispute Account to be created under the\n     Escrow Agreement.\n\n          ESCROW AGENT means Citibank, N.A., in its capacity as escrow agent\n     under the Escrow Agreement, and its successors in such capacity.\n\n          ESCROW AGREEMENT means that Escrow Agreement to be entered into, in\n     the event of a dispute as described in Sub-Article 5(C)(5), by and among\n     the Contractor, the Purchaser and the Escrow Agent, substantially in the\n     form of Exhibit D hereto, with such changes therein as are reasonably\n     requested by the Escrow Agent, as amended modified or supplemented from\n     time to time.\n\n          EVENT OF DEFAULT has the meaning set forth in Sub-Article 13(A).\n\n          EXCLUDED TAX means (i) any franchise, excess profits, net worth,\n     capital or capital gains Tax, as well as any Tax on doing business or\n     imposed on net or gross income or receipts (including minimum and\n     alternative minimum Taxes measured by any items of Tax preference), but in\n     each case excluding Taxes that are or are in the nature of sales, use,\n     excise, license, stamp, rental, ad valorem, value added or property\n\n \n                                                                               5\n\n     Taxes; (ii) any Taxes imposed by a jurisdiction other than one in which (a)\n     the Contractor is or is treated as engaged in activities contemplated by or\n     in fulfillment of the Contract or (b) the Purchaser or its affiliates has a\n     nexus to such jurisdiction and the Tax imposed is attributable to that\n     nexus, (iii) Taxes imposed on the Contractor as a result of Contractor's\n     gross negligence or willful misconduct and (iv) any import duty, other\n     import related charges, sales or use tax, VAT or property tax imposed by\n     the United States or any political subdivision thereof or Taxing authority\n     therein in respect of Supplies brought into the United States for testing,\n     modification or other similar purposes prior to being installed or used\n     outside the United States.\n\n          EXPEDITED UPGRADE has the meaning set forth in Sub-Article 6A(L).\n\n          FINAL COMMISSIONING REPORT has the meaning set forth in Section 7,\n     Commissioning and Acceptance section of the Technical Volume.\n\n          FINAL SURVEY REPORT means the final survey report described in Section\n     5 of the Marine Installation section of the Technical Volume.\n\n          FOB means free on board as defined in the International Chamber of\n     Commerce, Guide to Incoterms (1990).\n\n          FORCE MAJEURE has the meaning set forth in Sub-Article 17(A).\n\n          * \n\n          * \n\n          INDEPENDENT ENGINEER means Conexart Technologies, Inc. or a similarly\n     qualified successor in the capacity as the engineer to the financing\n     sources specified in Sub-Article 37(C) who has agreed to be bound by the\n     confidentiality provisions of this Contract and who is not affiliated with\n     a competitor of Contractor.\n\n          INFORMATION has the meaning set forth in Sub-Article 20(A).\n\n          INITIAL CONTRACT PRICE has the meaning set forth in Sub-Article\n     4(A)(1).\n\n          INITIAL UPGRADE PRICE has the meaning set forth in Sub-Article\n     4(A)(2).\n\n          INTELLECTUAL PROPERTY has the meaning set forth in Sub-Article 18(A).\n\n          LAWS means any laws, ordinances, regulations, rules, orders,\n     proclamations, requirements of governmental authorities or treaties.\n\n          MANUFACTURING MATERIALS has the meaning set forth in Sub-Article\n     13(B).\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                               6\n\n          MILESTONES means the milestones set forth in the Progress Schedule\n     attached as Appendix 5 to this Contract.\n\n          NEXUS TAX means any Tax imposed by way of withholding in respect of or\n     in lieu of an Excluded Tax, but only to the extent such Tax would not have\n     been imposed but for the nexus (other than as a consequence of the\n     activities of the Contractor) of the Purchaser or its affiliate to the\n     jurisdiction imposing the Tax.\n\n          NON-SHIP COSTS has the meaning set forth in Sub-Article 10(A)(2).\n\n          NOTICE OF TERMINATION has the meaning set forth in Sub-Article 14(A).\n\n          OPTION PERIOD has the meaning set forth in Sub-Article 6A(B).\n\n          PARTY(IES) means either of the Purchaser and\/or the Contractor, as\n     appropriate.\n\n          PERFORMANCE REQUIREMENTS means (i) with respect to a Segment or the\n     System, the applicable System Performance Requirements set forth or to be\n     developed by mutual agreement pursuant to the System Performance and\n     Availability section of the Technical Volume, (ii) with respect to any\n     System Upgrade, the applicable System Performance Requirements set forth in\n     or to be developed by mutual agreement pursuant to the Technical Volume or\n     (iii) in each case, such other Segment, System or System Upgrade\n     performance levels as mutually agreed by the Parties.\n\n          PERMITS means all Access Rights, permits, pipeline and cable crossing\n     agreements, approvals, \"no objections\", permissions-in-principle,\n     authorizations, consents, customs clearances, registrations, certificates,\n     rights-of-way, certificates of occupancy, licenses, including without\n     limitation, landing licenses, orders, vessel and crew authorizations\/visas,\n     permission for the operation of navigational aids and radio systems and\n     similar authorizations necessary to complete the Work and operate and\n     maintain the System (other than any of the foregoing (i) relating to the\n     ownership, operation and maintenance of the System and not necessary until\n     after the System is Ready for Final Acceptance, (ii) which is or would be\n     needed by Purchaser to engage in any business outside the business of\n     developing, owning and operating a submarine cable system or (iii) which is\n     or would be needed at any time by any purchaser or lessee of capacity on\n     the System).\n\n          PROVISIONING SCHEDULE means the price schedule attached hereto in\n     Appendix 1.\n\n          PURCHASER means GCT Pacific Holdings, Ltd. and shall include its\n     permitted successors and assigns.\n\n          READY FOR COMMERCIAL ACCEPTANCE means\n\n               (i)  for any Segment, that\n\n \n                                                                               7\n\n                     (a)  if the System is not at the same time also Ready for\n               Commercial Acceptance, the Purchaser has consented, in its sole\n               discretion, to accept such Segment as Ready for Commercial\n               Acceptance,\n\n                     (b)  such Segment has the ability to carry commercial\n               traffic between the two landing points of such Segment meeting\n               performance criteria of ITU-T G.826 as defined in the System\n               Performance section of the Technical Volume and has line\n               monitoring and protection switching capability,\n\n                     (c)  Contractor has tested and provided for STM-1\n               interconnectivity capability (or such other interconnectivity\n               capability as may be mutually agreed) to the Segment terminal\n               equipment according to ITU-T G.826,\n\n                     (d)  Contractor has substantially performed its obligations\n               under Article 18 (Intellectual Property) then required to be\n               performed by it, and\n\n                     (e)  all Permits are obtained for such Segment, and\n\n               (ii)  for the System,\n\n                     (a)  that the System has the ability to carry commercial\n               traffic throughout the System (operating at 20 Gb\/s per fiber\n               pair) meeting performance criteria of ITU-T G.826 as defined in\n               the System Performance section of the Technical Volume with self\n               healing ring protection capability and per Segment protection\n               capability, has line monitoring and per Segment protection\n               switching capability and has network management capability,\n\n                     (b)  Contractor has tested and provided for STM-1\n               interconnectivity capability (or such other interconnectivity\n               capability as may be mutually agreed) to the System terminal\n               equipment according to ITU-T G.826,\n\n                     (c)  Contractor has substantially performed its obligations\n               under Article 18 (Intellectual Property) then required to be\n               performed by it and\n\n                     (d)  all Permits are obtained for the System and\n\n               (iii) for any System Upgrade, the System is Ready for Commercial\n          Acceptance at the capacity specified for such System Upgrade.\n\n \n                                                                               8\n\n          READY FOR FINAL ACCEPTANCE means\n\n               (i)   for the System, that\n\n                     (a)  (I)  the System has successfully and continuously\n               (other than by reason of Force Majeure in which case the test\n               period shall be extended for a time period equal to the time\n               period of such Force Majeure) functioned in compliance with the\n               System Performance Requirements during the period of ninety (90)\n               consecutive days after the Date of Provisional Acceptance or\n\n                          (II) if the System shall have failed to meet the\n               System Performance Requirements at any time during such period\n               (other than by reason of Force Majeure), the Contractor has\n               corrected such failure and the System has successfully and\n               continuously (other than by reason of Force Majeure in which case\n               the test period shall be extended for a time period equal to the\n               time period of such Force Majeure) functioned in compliance with\n               the System Performance Requirements for such additional period of\n               time not to exceed ninety (90) days (and not to end prior to the\n               date 90 days after the Date of Provisional Acceptance) as\n               reasonably determined by the Independent Engineer as being\n               sufficient to confirm that such failure has been corrected and\n               that no other failures are likely to appear and\n\n                     (b)  all deficiencies noted in the Certificate of\n               Provisional Acceptance have been corrected (other than minor\n               deficiencies which will not affect the operation of the System,\n               in respect of which an equitable adjustment to the Contract Price\n               will be made) and\n\n                     (c)  Contractor has complied in all material respects with\n               Article 18 (Intellectual Property) and\n\n               (ii)  for any System Upgrade, that\n\n                     (a)  (I)  the System Upgrade has successfully functioned in\n               compliance with the System Performance Requirements during the\n               period of ninety (90) days after the Date of Provisional\n               Acceptance of the System Upgrade or (II) if the System Upgrade\n               shall have failed to meet the System Performance Requirements\n               during such period, the Contractor has corrected such failure and\n               the System Upgrade has successfully functioned in compliance with\n               the System Performance Requirements for such additional period of\n               time not to exceed ninety (90) days as reasonably determined by\n               the Independent Engineer as sufficient to confirm that such\n               failure has been corrected and\n\n \n                                                                               9\n\n                     (b)  all deficiencies noted in the Certificate of\n               Provisional Acceptance have been corrected (other than minor\n               deficiencies which will not affect the operation of the System,\n               in respect of which an equitable adjustment of the Contract Price\n               will be made) and\n\n                     (c)  Contractor has complied in all material respects with\n               Article 18 (Intellectual Property).\n\n          READY FOR PROVISIONAL ACCEPTANCE means\n\n               (i)   with respect to any Segment,\n\n                     (a)  in the case of all Segments other than Segment S, if\n               the System is not, at the same time, also Ready for Provisional\n               Acceptance, the Purchaser has consented, in its sole discretion,\n               to accept such segment as Ready for Provisional Acceptance,\n\n                     (b)  such Segment is complete in all material respects (and\n               in any event is Ready for Commercial Acceptance),\n\n                     (c)  the results of Acceptance Testing of such Segment\n               demonstrate that such Segment has satisfied the System\n               Performance Requirements,\n\n                     (d)  Contractor has substantially performed its obligations\n               under Article 18 (Intellectual Property) then required to be\n               performed by it,\n\n                     (e)  all Permits are obtained for such Segment, and\n\n               (ii)  with respect to the System, the System is complete in all\n          material respects (and in any event is Ready for Commercial\n          Acceptance), all Segments are Ready for Provisional Acceptance with\n          self-healing ring protection capability and per Segment protection\n          capability and line monitoring and network management capability and\n\n               (iii) with respect to any System Upgrade, the results of\n          Acceptance Testing of such System Upgrade demonstrate that such System\n          Upgrade is complete in all material respects and is sufficient to\n          realize the Performance Requirements.\n\n          REPRESENTATIVES has the meaning set forth in Article 36(B).\n\n          RETAINAGE means an amount equal to * of the Initial Contract Price.\n\n          RETESTING has the meaning set forth in Sub-Article 9(B)(3).\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              10\n\n          ROUTE SURVEY means the route survey described in the Marine section of\n     the Technical Volume.\n\n          SCHEDULED SEGMENT S RFS DATE has the meaning set forth in Sub-Article\n     9(A).\n\n          SCHEDULED SYSTEM RFS DATE has the meaning set forth in Sub-Article\n     9(A).\n\n          SCHEDULED UPGRADE DATE means for any System Upgrade, the date by which\n     the Contractor agrees such System Upgrade will be Ready for Provisional\n     Acceptance pursuant to Sub-Article 6A(K) hereof.\n\n          SEGMENT means Segment N, Segment S, Segment E or Segment W, as the\n     case may be.\n\n          SEGMENT E means the Segment of the System from Toro Creek, California,\n     United States to Norma Beach, Washington, United States and landing in\n     locations capable of interconnecting with major telecommunications\n     carriers.\n\n          SEGMENT N means the Segment of the System from Norma Beach,\n     Washington, United States to Ajigaura, Japan and landing in locations\n     capable of interconnecting with major telecommunications carriers.\n\n          SEGMENT S means the Segment of the System from Shima, Japan to Toro\n     Creek, California, United States and landing in locations capable of\n     interconnecting with major telecommunications carriers.\n\n          SEGMENT W means the Segment of the System from Ajigaura, Japan to\n     Shima, Japan and landing in locations capable of interconnecting with major\n     telecommunications carriers.\n\n          SHIP COSTS has the meaning set forth in Sub-Article 10(A)(2).\n\n          SHIP PERIOD has the meaning set forth in Sub-Article 10(A).\n\n          SUPPLIES means any and all materials, plant, machinery, equipment,\n     hardware and items supplied by the Contractor under this Contract.\n\n          SUSPENSION means a suspension in pursuant to Sub-Article 15(A) or\n     15(B).\n\n          SYSTEM means the four fiber pair submarine cable system consisting of\n     Segments N, S, E and W (at a per fiber pair capacity of * Gb\/s at the Date\n     of Commercial Acceptance or the Date of Provisional Acceptance, as the case\n     may be, of the System, with each Segment having the capability of being\n     upgraded to * Gb\/s per fiber pair at the Date of Provisional Acceptance),\n     including the cable stations, as more fully described in the System\n     Description section of the Technical Volume.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n \n                                                                              11\n\n          SYSTEM PERFORMANCE REQUIREMENTS has the meaning set forth in the\n     System Description section of the Technical Volume.\n\n          SYSTEM UPGRADE has the meaning set forth in Sub-Article 6A(A).\n\n          TAX means any tax, duty, levy, charge or custom (including, without\n     limitation, any sales or use tax, VAT or octroi duty relating to the\n     Contract items and fiscal stamps connected with Contract legalization)\n     imposed or collected by any taxing authority or agency (domestic or\n     foreign).\n\n          TECHNICAL VOLUME means the Technical Volume attached hereto as\n     Appendix 6.\n\n          TRANSFEREE means any entity to which purchaser assigns rights\n     hereunder pursuant to Sub-Article 37(D) hereof.\n\n          UPGRADE BILLING SCHEDULE means the billing schedule attached hereto as\n     Appendix 2A.\n\n          UPGRADE COMMISSIONING REPORT has the meaning set forth in the\n     Commissioning and Acceptance section of the Technical Volume.\n\n          UPGRADE PERIOD has the meaning set forth in Sub-Article 6A(E).\n\n          UPGRADE PLAN OF WORK means the plan of work attached hereto as\n     Appendix 3A.\n\n          UPGRADE PRICE means, for any System Upgrade, the Initial Upgrade Price\n     for such System Upgrade, plus any variations pursuant to Article 6\n     (Contract Variations), Taxes as set forth in Sub-Article 4(B) and other\n     adjustments to such Upgrade Price provided for in this Contract.\n\n          UPGRADE PROVISIONING SCHEDULE means the provisioning schedule attached\n     hereto as Appendix 1A.\n\n          UPGRADE WARRANTY PERIOD has the meaning set forth in Sub-Article\n     10(A).\n\n          UPGRADE WORK means the activities and services to be performed or\n     provided by Contractor under Article 6A (Optional Upgrades).\n\n          * \n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n \n                                                                              12\n\n           WARRANTY PERIOD has the meaning set forth in Sub-Article 10(A).\n\n           WORK means all activities and services (other than the activities and\n     services specified in this Contract to be provided by Purchaser) necessary\n     to be performed or provided in developing, planning, designing,\n     manufacturing, constructing, delivering, installing and testing the System,\n     until the System is Ready for Final Acceptance, including without\n     limitation, designating, coordinating, obtaining and paying for on behalf\n     of Purchaser the Access Rights and obtaining all Permits except landing\n     licenses.  Whether or not used in conjunction with the term \"Supplies\", the\n     term \"Work\" shall always be deemed to include the provision of the relevant\n     Supplies, unless the context requires otherwise.\n\n           YEAR 2000 COMPLIANT means, when used with respect to any software or\n     materials, that such software or materials will operate accurately and,\n     without interruption, accept, possess and in all manner retain full\n     functionality when referring to, or involving, any year or date in the\n     twentieth or twenty-first centuries.\n\nARTICLE 4  CONTRACT PRICE\n-------------------------\n\n     A.    Contract Price\n\n           1.  The initial Contract Price for the Work, in United States Dollars\n               (US$) is a fee of * (the \"Initial Contract Price\") which includes\n               a fixed component of * (the \"Fixed Component\") and a variable\n               component of * (which is subject to adjustment to correspond to\n               the actual cost (including out-of-pocket fees and expenses)\n               incurred by Contractor in obtaining land in Japan on which two\n               cable stations, and any parking lots thereto, are built pursuant\n               to Sub-Article 6(D) (the \"Variable Component\"). The Initial\n               Contract Price does not include the cost of optional upgrades\n               which are described in Article 6A (Optional Upgrades), any\n               contract variations as provided for in Article 6 (Contract\n               Variations), or any Taxes. The Fixed Component of the Initial\n               Contract Price includes all costs and expenses incurred in\n               obtaining all Permits (including Access Rights) including those\n               incurred with respect to cable stations (excluding the cost of\n               acquiring land in Japan on which the two cable stations, and any\n               parking lots thereto, are built pursuant to Sub-Article 6(D)).\n               The Fixed Component of the Initial Contract Price includes all\n               the Work except for the Work described in the Variable Component.\n               The Fixed Component includes all charges for CIF.\n\n           2.  The Initial Upgrade Price for any Upgrade Work, in United States\n               Dollars (US$) is the fixed fee set forth in Appendix 2A (the\n               \"Initial Upgrade Price\"). No Initial Upgrade Price includes the\n               cost of any contract variations as provided for in Article 6\n               (Contract Variations) or any Taxes.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n \n                                                                              13\n\n          3.   The Provisioning Schedule sets forth the Contractor's estimate of\n               the breakdown of the Initial Contract Price among various aspects\n               of the Work. If the actual cost of any aspect of the Work is\n               greater or less than that set forth in the Provisioning Schedule,\n               such fact shall not cause any change in the Initial Contract\n               Price, except for the Variable Component.\n\n          4.   Without the prior written consent of the Purchaser, which consent\n               shall not be unreasonably withheld or delayed, the Contractor\n               shall not arrange for any\n\n               (a)  Access Right which requires payments to be made by the\n                    Purchaser or made after the System is Ready for Provisional\n                    Acceptance or\n\n               (b)  Permit which requires aggregate payments in excess of\n                    * to be made by Purchaser or made after the System is Ready\n                    for Provisional Acceptance.\n\n     B.   Taxes, Levies and Duties\n\n          1.   The Initial Contract Price and each Initial Upgrade Price, as\n               stated in Sub-Article 4(A) above, excludes any Tax. The Contract\n               Price and each Upgrade Price shall without duplication be\n               adjusted for any Tax imposed on or in connection with this\n               Contract (including, without limitation, the execution and\n               delivery of this Contract, the Work, the Upgrade Work and the\n               Supplies, but excluding any Excluded Taxes) (any such Taxes,\n               other than Excluded Taxes, are hereinafter referred to as\n               \"Contract Taxes\"). Contractor has provided a good faith estimate\n               of the Contract Taxes payable by the Purchaser; it being\n               understood that the Contractor shall have no liability under this\n               Contract or otherwise to the Purchaser for any errors or\n               omissions in such estimate or any losses arising therefrom. The\n               Contractor shall be responsible for any Excluded Tax that might\n               be incurred by the Contractor as well as any Tax described in\n               clause (iv) of the definition of Excluded Tax.\n\n          2.   The Purchaser will be ultimately responsible for the payment of\n               all Contract Taxes (including, without limitation, Contract Taxes\n               that are VAT, octroi duties relating to Contract items and fiscal\n               stamps, etc. connected with Contract legalizations to the\n               authorities in their countries). In the case of any Contract\n               Taxes paid by the Contractor, the Contractor shall submit payment\n               on the Purchaser's behalf and Contractor will be reimbursed by\n               the Purchaser in accordance with Article 5 (Terms of Payment by\n               Purchaser).\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n \n                                                                              14\n\n          3.   The Contractor agrees to use reasonable efforts including,\n               without limitation, by registering for VAT and any applicable\n               sales Taxes in any country, state or other jurisdiction where\n               legally required, to cooperate with and assist Purchaser in its\n               efforts (i) to have Supplies which are the subject of this\n               Contract made exempt from Contract Taxes, whether in the\n               manufacture of the Supplies or related to the importation or\n               location or installation of the Supplies, (ii) to request\n               revisions, drawbacks, remissions, reclassifications or the like\n               to the jurisdictions identified by the Purchaser; or (iii) to\n               reduce or eliminate Contract Taxes (including the provision of\n               applicable certifications and forms) and to obtain any available\n               refunds of Contract Taxes, provided that the Contractor shall not\n                                          --------                              \n               be required to act other than in accordance with the relevant\n               Laws then in force. The Purchaser shall reimburse the Contractor,\n               in accordance with Article 5, for any reasonable costs (including\n               the reasonable fees and expenses of legal counsel, accountants\n               and other advisors) incurred by the Contractor under this Sub-\n               Article 4(B)(3) provided that Purchaser was notified and has\n                               --------                                    \n               consented to the incurrence of such costs, fees and expenses.\n               Contractor shall not be required to cooperate with and assist\n               Purchaser in its efforts under this Sub-Article 4(B)(3) or to\n               take any action hereunder which in the Contractor's good faith\n               judgment would incur any costs or if in Contractor's good faith\n               judgment it would be advisable to obtain the advice of counsel,\n               accountants or other advisors prior to cooperating with or\n               assisting purchaser or taking any action, unless in each case,\n               Purchaser has agreed to reimburse Contractor under the foregoing\n               proviso.\n\n          4.   Prior to the Date of Provisional Acceptance with respect to the\n               System or any System Upgrade, the Contractor shall provide\n               evidence of having made all payments for Taxes included in the\n               Contract Price or Upgrade Price or described in clause (iv) of\n               the definition of Excluded Taxes, other than VAT due on payments\n               of the Contract Price or Upgrade Price made on or after the Date\n               of Provisional Acceptance of the System or System Upgrade, which\n               evidence shall be provided within sixty (60) days of the date of\n               each such payment.\n\n          5.   As part of Work or any Upgrade Work, the Contractor shall obtain\n               at its expense, on Purchaser's behalf, any import license or\n               other official authorization and carry out all customs\n               formalities necessary for the importation or exportation of goods\n               in connection with such Work or Upgrade Work. The Purchaser\n               agrees to be the Importer or Exporter of Record or designate an\n               Importer or Exporter of Record\/Consignee on its behalf. Purchaser\n               must provide a Letter of Authorization from any third party\n               designate stating it agrees to be the Importer or Exporter of\n               Record on Purchaser's behalf and identify the name and address of\n               the designated Importer or Exporter of Record.\n\n \n                                                                              15\n\n          6.   The Supplies to be installed or held on land shall be delivered\n               to the agreed point at the named place of destination and shall\n               be consigned to the Purchaser.\n\n     C.   Withholding Tax\n\n          1.   If withholding for any Tax is required in respect of any payment\n               to the Contractor, the Purchaser shall (i) withhold the\n               appropriate amount from such payment, (ii) pay such amount to the\n               relevant authorities in accordance with the applicable Laws and\n               (iii) in the case of any such withholding in respect of a\n               Contract Tax or a Nexus Tax and subject to the Contractor's\n               satisfying the obligations set forth in the last sentence of this\n               Sub-Article 4(C)(1), pay the Contractor an additional amount such\n               that the net amount received by the Contractor is the amount the\n               Contractor would have received in the absence of such\n               withholding. In such a case, the Purchaser shall provide to the\n               Contractor, as soon as reasonably practicable, a certified copy\n               of an official tax receipt for any Tax which is retained from any\n               payment due to the Contractor or for any Tax which is paid on\n               behalf of the Contractor. All such receipts shall be in the name\n               of the Contractor. The Contractor agrees to complete accurately\n               and timely provide to the Purchaser or, if required, to the\n               applicable Taxing authority, such forms, certifications or other\n               documents as may be requested in timely manner by Purchaser, in\n               order to allow it to make payments to the Contractor without any\n               deduction or withholding on account of withholding Taxes (or at a\n               reduced rate thereof) or to receive a refund of any amounts\n               deducted or withheld on account of withholding Taxes.\n\n          2.   If the Contractor shall become aware that it is entitled to\n               receive a refund or credit from a relevant taxing or governmental\n               authority in respect of a Contract Tax or Nexus Tax as to which\n               the Purchaser has paid an additional amount pursuant to Sub-\n               Article 4(C)(1) above, the Contractor shall promptly notify the\n               Purchaser of the availability of such refund or credit and shall,\n               within 30 days after receipt of a request by the Purchaser\n               (whether as a result of notification that it has made to the\n               Purchaser or otherwise), make a claim to such taxing or\n               governmental authority for such refund or credit at the\n               Purchaser's expense. If the Contractor receives a refund or\n               credit in respect of a Contract or Nexus Tax as to which the\n               Purchaser has paid an additional amount pursuant to Sub-Article\n               4(C)(1) above, or if, as a result of the Purchaser's payment of\n               such additional amounts, the Contractor or any other member of an\n               affiliated group, as defined in section 1504(a) of the Code, of\n               which the Contractor is a member, receives a credit against Taxes\n               imposed on its income or franchise taxes imposed on it by the\n               country under the laws of which it is organized or any political\n               subdivision thereof, the Contractor shall promptly notify the\n               Purchaser\n\n \n                                                                              16\n\n               of such refund or credit and shall within 30 days from the date\n               of receipt of such refund or benefit of such credit pay over the\n               amount of such refund or benefit of such credit (including any\n               interest paid or credited by the relevant taxing or governmental\n               authority with respect to such refund or credit) to the Purchaser\n               (but only to the extent of the additional payments made by the\n               Purchaser under Sub-Article 4(C)(1) above with respect to the\n               Contract or Nexus Tax giving rise to such refund or credit), net\n               of all out-of-pocket expenses of the Contractor; provided,\n                                                                -------- \n               however, that the Purchaser, upon the request of the Contractor\n               -------                                                        \n               agrees to repay the amount paid over to the Purchaser (plus\n               penalties, interest or other charges due to the appropriate\n               authorities in connection therewith) to the Contractor in the\n               event the Contractor is required to repay such refund or credit\n               to such relevant authority.\n\nARTICLE 5  TERMS OF PAYMENT BY PURCHASER\n----------------------------------------\n\n     A.    General Conditions of Payment\n\n           1.  All payments shall be made and all invoices shall be rendered in\n               US Dollars (US$). The Purchaser shall be responsible for and\n               shall pay all costs and fees for payment, as well as the banking\n               and wiring costs. All banking documents and correspondence must\n               be in English.\n\n     B.    Invoice Procedures\n\n           1.  All invoices for Work shall be submitted according to the Billing\n               Schedule, provided, that at the time of any such Invoice the\n                         --------                                          \n               relevant Milestones have been achieved. All invoices for Work\n               shall have a certificate addressed to Purchaser in the form of\n               Appendix 4A attached.\n\n           2.  Any Contract Variations shall be invoiced and paid in accordance\n               with the terms of the Contract Variation as specified in Article\n               6 (Contract Variations).\n\n           3.  Invoices for Upgrade Work shall be submitted according to the\n               Upgrade Billing Schedule and shall be paid in accordance with\n               this Article 5.\n\n           4.  Invoices for amounts not described in Sub-Sections 1-3 above,\n               which may become payable hereunder shall be submitted after\n               applicable costs have been incurred or such other time as may be\n               specified in this Contract. Such invoices shall be accompanied by\n               a certificate of the Contractor explaining such amount and\n               certifying that it is payable.\n\n           5.  The Contractor shall render all invoices to the following address\n               or facsimile number:\n\n \n                                                                              17\n\n                    GCT Pacific Holdings Ltd.\n                    Wessex House\n                    45 Reid Street\n                    Hamilton HM12\n                    Bermuda\n                    Facsimile: 441-296-6749\/8606\n                    Attn: Cameron Adderly\n\n               with a copy to\n\n                    Conexart Technologies, Inc.\n                    124 de Charante\n                    Saint Lambert\n                    Quebec, Canada\n                    J4S 1K3\n                    Facsimile: 514-466-1093\n                    Attn: Mr. Martin Fournier\n\n     C.   Payment Procedures\n\n          1.   The Purchaser shall pay the Contractor, and the Contractor shall\n               accept payment, in accordance with this Article 5 (Terms of\n               Payment by Purchaser).\n\n          2.   Purchaser agrees to pay an initial payment to Contractor in the\n               amount of *. Within three business days of the time this Contract\n               comes into force pursuant to Article 47 hereof, the first portion\n               of the initial payment, in the amount of *, shall be paid by\n               Purchaser to Contractor. Failure to receive this payment shall\n               entitle Contractor to immediately suspend Work hereunder. The\n               second portion of the initial payment, in the amount of *, shall\n               be paid by Purchaser to Contractor on June 30, 1998.\n\n          3.   Invoices given to the Purchaser (and the Independent Engineer) on\n               or before the last day of any month shall, subject to Sub-Article\n               5(C)(5) below, be due and payable on the last day of the next\n               month or such other time as may be specified in this Contract;\n               provided that invoices given to Purchaser on or before April 30,\n               --------                                                        \n               1998 shall be due and payable no earlier than June 30, 1998.\n\n          4.   Invoices not paid when due shall accrue late payment charges from\n               the day, following the day, on which payment was due until the\n               day on which it is paid. Invoices for such extended payment\n               charges shall not be issued for an amount less than U.S. $1,000.\n               Extended payment charges shall be computed at the rate of one\n               percent (1%) per month.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              18\n\n           5.  In the event that the Purchaser has an objection to any invoice\n               or other payment obligation or any amount owing by Contractor to\n               Purchaser shall not have been paid when due, the Purchaser shall\n               promptly notify the Contractor of such objection and such amount,\n               and the Purchaser and Contractor shall make every reasonable\n               effort to settle promptly the dispute concerning the payment(s)\n               in question. In the event such dispute cannot be settled, the\n               Purchaser will have the right to withhold payment of the disputed\n               amount(s) (or withhold from the invoice amount a sum equal to the\n               amount purportedly owing by Contractor) so long as it deposits,\n               in full, such disputed amount(s) into the Dispute Account.\n\n               (a)  Provided such disputed amount is placed into the Dispute\n                    Account in a timely manner, the Purchaser shall not be\n                    deemed to be in breach of or in default for failing to pay\n                    Contractor.\n\n               (b)  The Escrow Agent will distribute the disputed amount in\n                    accordance with the terms of the Escrow Agreement.\n\n               (c)  In addition, the prevailing Party shall be entitled to\n                    receive from the Dispute Account an amount equal to the\n                    interest earned by the Escrow Agent on the distributed,\n                    disputed amount, which shall be distributed by the Escrow\n                    Agent under clause (b) above.\n \n               The Contractor and the Purchaser will share equally the costs and\n               expenses of the Escrow Agent.\n\n               The Contractor and the Purchaser will execute and deliver an\n               Escrow Agreement substantially in the form of Exhibit D hereto,\n               with such changes therein as the Escrow Agreement may reasonably\n               request.\n\n           6.  The Purchaser shall make timely payments for that portion of the\n               invoice not in dispute in accordance with Sub-Article 5(C) or\n               such payments will be assessed extended payment charges as set\n               forth in Sub-Article 5(C)(4). Pending resolution of the dispute,\n               the Purchaser may not withhold payment (unless also subject to\n               dispute) on any other invoice concerning different goods and\/or\n               services submitted by Contractor.\n\nARTICLE 6  CONTRACT VARIATIONS\n-----------------------------\n\n     A.    Either Party may request, during construction of the System or any\nSystem Upgrade, by written order, a contract variation requiring additions or\nalterations to, deviations or deductions from the System or System Upgrade\n(\"Contract Variation\"). If the other Party consents, in its sole discretion,\nthis change will be formalized as an amendment to this Contract by a Contract\nVariation; provided, that the Contractor will not unreasonably withhold\n           --------                                                    \n\n \n                                                                              19\n\nits consent to a Contract Variation requested by the Purchaser; and provided\n                                                                    --------\nfurther, that Purchaser will not unreasonably withhold its consent to a Contract\n-------                                                                         \nVariation requested by the Contractor so long as such Contract Variation does\nnot affect the Contract Price, any Upgrade Price, the Scheduled System RFS Date,\nthe Scheduled Segment S RFS Date, any Scheduled Upgrade Date, any warranties or\nthe Performance Standards.\n\n     B.     A Contract Variation shall not become effective unless and until the\nprice adjustment, the terms and schedule of payment and the extension of time\nand all other terms have been mutually agreed upon by the Parties (and the\nParties shall act reasonably and in good faith in connection with all such\nterms) and such Contract Variation is signed by an authorized representative of\neach Party. Each Contract Variation shall be incorporated as an amendment to the\nContract.\n\n     C.     Contractor may seek a Contract Variation for any change, after the\ndate hereof, of any Law (except, and to the extent, affecting Taxes or wages)\nwhich requires a change in the Work or the Upgrade Work or affects the costs\n(other than wages) incurred or to be incurred by the Contractor or any\ncombination of the foregoing and Purchaser shall agree to any such change in\nWork or Upgrade Work as may be required and to an equitable adjustment to the\nContract Price or the applicable Upgrade Price. As of the date hereof, neither\nParty has Actual Knowledge of any proposed change in any Law that would require\na change in the Work or the Upgrade Work.\n\n     D.     The Parties will execute a Contract Variation to confirm the actual\namount of the Variable Component, after final adjustment, if any, pursuant to\nSub-Article 4(A)(1) hereof.\n\n     E.     The Initial Contract Price is based on the assumption that\nContractor will acquire ownership of land and build, on such land, two cable\nstations in Japan and two cable stations in the United States. To the extent\nthat such assumption is incorrect (if, for example, the Contractor shall lease\nspace in one or more existing cable stations) both Parties will agree to an\nequitable adjustment, up or down, to the Contract Price and the terms and\nschedule of payments. The Contractor will consult with, and obtain the consent\nof the Purchaser (not to be unreasonably withheld or delayed) regarding the\nlocation of cable stations and whether to acquire, build, or lease such cable\nstations. Any lease for space in a cable station shall be reasonably\nsatisfactory in form and substance to the Purchaser.\n\nARTICLE 6A. OPTIONAL UPGRADES\n-----------------------------\n\n     A.     This Article includes the terms and conditions governing an option\nfor future upgrades to the System (each a \"System Upgrade\") that may be\nexercised by Purchaser during the Option Period.\n\n     B.     * \n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n \n                                                                              20\n\n     C.   *\n                                                                               \n\n     D.   *\n                                                                               \n                                                                               \n     E.   *\n                                                    \n                                                    \n     F.   *\n                                                                              \n\n     G.   *\n\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n\n \n                                                                              21\n          *\n\n\n     H.   *\n\n\n     I.   *\n\n\n     J.   *\n\n\n     K.   *\n\n\n     L.   *\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              22\n\n*\n\nARTICLE 7  RESPONSIBILITIES FOR PERMITS; COMPLIANCE WITH LAWS\n-------------------------------------------------------------\n\n     A.    The Purchaser shall reasonably cooperate with and assist the\nContractor to obtain all Permits (except those specified in paragraph C below),\nto the extent that Purchaser's cooperation and assistance are necessary for\nContractor to expeditiously and cost-efficiently obtain such Permits. The\nPurchaser agrees to respond promptly to any such request from Contractor.\nFurther, the Purchaser agrees that it will not impede or interfere with\nContractor's activities or Contractor's abilities to perform its obligations.\nUpon notice from Contractor with respect to a Permit or receipt by Purchaser of\na copy of a Permit, Purchaser shall fulfill all conditions of such Permit and\nperform all responsibilities thereunder, except to the extent that such\nconditions or responsibilities are those of the Contractor under Work.\nContractor will inform Purchaser as to any such conditions or responsibilities\nthat, in the Contractor's reasonable judgment, are not ordinary and routine and\nobtain Purchaser's consent, which consent shall not be unreasonably withheld,\nthereto prior to arranging for any such Permit.\n\n     B.    Subject to paragraph C below, the Contractor shall have the\nresponsibility for obtaining, at Contractor's sole cost and expense, all Permits\non Purchaser's behalf. The Contractor will cause all Permits not issued in the\nname of Purchaser to be assignable to Purchaser, and to be assigned to Purchaser\nat the time title to the System is transferred to Purchaser pursuant to this\nContract. Subject to Sub-Article 4(A)(4), Purchaser shall be \n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              23\n\nresponsible for payment of all Permit fees and other costs and expenses due with\nrespect to any Permit after the Date of Provisional Acceptance of the System.\n\n     C.    The Purchaser shall be responsible for obtaining, at its expense,\nlanding licenses in the United States and Japan.  The Contractor will cooperate\nwith the Purchaser in connection therewith.  Purchaser shall reimburse\nreasonable outside counsel fees, reasonable independent consultant fees and\nother reasonable out-of-pocket expenses incurred by Contractor in connection\nwith such cooperation.\n\n     D.    Any delay in obtaining or failure to obtain any Permit shall\nconstitute a Force Majeure and be treated as described in Article 17 (Force\nMajeure), except to the extent such delay is a result of Contractor's negligence\nor willful misconduct.\n\n     E.    Except with respect to variations necessitated by complying with any\nchanges, enacted after the date hereof, in any Laws (the costs with respect to\nwhich shall be borne by the Purchaser), the Contractor shall be responsible for\nthe payment of any and all costs incurred as a result of the need to vary\ndesign, drawings, plans or procedures to comply with any of the circumstances\nset forth in this Article. The Contractor shall, before making any variations\nfrom the designs, drawings, plans or procedures that may be necessitated by so\ncomplying with any Laws and that would represent a material change to the\noverall design of the System, give to the Purchaser written notice, specifying\nthe variations proposed to be made, and the reasons for making them. As of the\ndate hereof, neither Party has Actual Knowledge of any proposed changes in the\nLaws which would necessitate any such variation.\n\n     F.    The Contractor shall (i) give all notices required by any Laws to be\ngiven to any authority and (ii) perform or permit the performance by authorized\npersons of any inspection required by the said Laws, subject to Sub-Article\n6(C).\n\n     G.    Within 30 days after the date of execution of this Contract, the\nContractor will prepare and deliver to the Purchaser a detailed list of Permits\nthat to its knowledge are required to be obtained under current law in order to\ncomplete the Work and shall update such list from time to time if it becomes\naware of changes in Permit requirements. Such list, as updated from time to\ntime, shall set forth the projected dates of filing for such Permits and an\nestimate of when such Permits are expected to be obtained. Without limiting\nContractor's liabilities in respect of Sub-Articles 7(B), Contractor shall have\nno liability in respect of the accuracy of the information furnished under this\nSub-Article, except in the case of gross negligence or willful misconduct.\n\nARTICLE 8  ROUTE SURVEY\n-----------------------\n\n     A.    The Contractor shall conduct the Route Survey and select the cable\nroute for the System in accordance with the information in the Final Survey\nReport. Contractor shall be permitted to make changes, at its discretion, to the\nroute selection, if necessary for operational reasons without additional cost to\nPurchaser.\n\n \n                                                                              24\n\n     B.    Any changes to the route selection requested by Purchaser (such as a\nchange of location for, or an addition of, a cable station) shall be treated as\na Contract Variation in accordance with Article 6 (Contract Variations).\n\nARTICLE 9  ACCEPTANCE\n---------------------\n\n     A.    General\n\n           1.   The Acceptance Testing shall be performed by the Contractor. The\n                Purchaser and its designated representatives (including the\n                Independent Engineer) may observe, at their own expense, the\n                Contractor's tests and review the test results. Purchaser may\n                request and conduct any additional tests, at its own expense,\n                but any delay caused by such process shall be a Force Majeure\n                event.\n\n           2.   Until the Date of Final Acceptance of the System or if a System\n                Upgrade is requested by Purchaser, the Date of Final Acceptance\n                of such System Upgrade, the Purchaser agrees to allow Contractor\n                access to all Segments of the System.\n\n           3.   The Purchaser shall issue a Certificate of Commercial Acceptance\n                in accordance with the provisions of Sub-Article 9(D)(1).\n\n           4.   Once a Segment of the System, the System, or a System Upgrade is\n                Ready for Provisional Acceptance, the Purchaser shall issue a\n                Certificate of Provisional Acceptance; provided, that it is\n                                                       --------            \n                within the Purchaser's sole discretion as to whether to accept a\n                Segment (other than Segment S) instead of the System.\n\n           5.   Once the System or a System Upgrade is Ready for Final\n                Acceptance, the Purchaser shall issue a Certificate of Final\n                Acceptance.\n\n           6.   The Purchaser shall not unreasonably withhold or delay issuance\n                of a Certificate of Commercial Acceptance, a Certificate of\n                Provisional Acceptance or a Certificate of Final Acceptance.\n\n           7.   The Contractor agrees that the Date of Provisional Acceptance or\n                Commercial Acceptance of Segment S will occur by March 31, 2000\n                (as such date may be extended under Article 6 (Contract\n                Variations) Article 17 (Force Majeure) or otherwise under this\n                Contract or by agreement of the Parties, the \"Scheduled Segment\n                S RFS Date\").\n\n           8.   The Contractor agrees that the Date of Provisional Acceptance or\n                Commercial Acceptance of the System will occur by July 31, 2000\n                (as such date may be extended under Article 6 (Contract\n                Variations),\n\n \n                                                                              25\n\n                Article 17 (Force Majeure) or otherwise under this Contract or\n                by agreement of the Parties, the \"Scheduled System RFS Date\").\n\n           9.   The Date of Commercial Acceptance, Provisional Acceptance and\n                Final Acceptance, as the case may be, shall be deemed to have\n                occurred with respect to a Segment, the System or a System\n                Upgrade if a Certificate of Commercial Acceptance, a Certificate\n                of Provisional Acceptance or a Certificate of Final Acceptance\n                is issued with respect thereto.\n\n     B.    Notice of Acceptance or Rejection\n\n           1.   Within thirty (30) days of receipt by Purchaser and Independent\n                Engineer of the Commissioning Report or Upgrade Commissioning\n                Report, as the case may be, the Purchaser must issue\n                notification to the Contractor of the following:\n\n                (a)  issuance of a Certificate of Provisional Acceptance in\n                     accordance with Sub-Article 9(C); or\n\n                (b)  rejection of a Certificate of Provisional Acceptance, but\n                     instead issuance of a Certificate of Commercial Acceptance\n                     in accordance with Sub-Article 9(D) below; or\n\n                (c)  rejection of the Segment, the System or System Upgrade in\n                     its existing condition and issuance of neither a\n                     Certificate of Provisional Acceptance nor a Certificate of\n                     Commercial Acceptance, with in the case of the System or\n                     System Upgrade a written explanation of reasons for\n                     rejection (it being understood that acceptance of a Segment\n                     instead of the System (other than Provisional Acceptance of\n                     Segment S) is at the sole discretion of the Purchaser).\n\n                If the Purchaser (or the Independent Engineer on its behalf)\n                fails to respond with such notification within thirty (30) days,\n                then the Date of Provisional Acceptance of the Segment (subject\n                to Purchaser's consent), the System or System Upgrade shall be\n                deemed to be the date such Commissioning Report or Upgrade\n                Commissioning Report, as the case may be, was received by the\n                Purchaser.\n\n           2.   On receipt of a notice from the Purchaser pursuant to Sub-\n                Articles 9(B)(1)(b) or (c) above, the Contractor shall be\n                entitled to address any disputes and explain any discrepancies\n                to the Purchaser regarding the results of the Acceptance\n                Testing. Unless Purchaser, for good cause, rejects such\n                explanation, it shall issue a new notice pursuant to Sub-Article\n                9(B)(1) above, which shall be deemed to have been issued on the\n                date of the original notice.\n\n \n                                                                              26\n\n          3.   In case of rejection, and if the explanation by the Contractor as\n               in Sub-Article 9(B)(2) above is not accepted, for good cause, by\n               the Purchaser, the Contractor shall carry out the necessary\n               corrective actions and will effect a new series of Acceptance\n               Testing (\"Retesting\"). After receipt by Purchaser and Independent\n               Engineer of the new Commissioning Report or Upgrade Commissioning\n               Report, as the case may be, describing the results of Retesting,\n               the Purchaser will be granted a new period of thirty (30) days to\n               analyze the new Report according to the provisions of Sub-Article\n               9(B)(1) and any new notice of the Purchaser shall apply from the\n               date the Purchaser receives such new Commissioning Report or\n               Upgrade Commissioning Report, as the case may be.\n\n     C.   Provisional Acceptance\n\n          1.   The Certificate of Provisional Acceptance may have annexed to it\n               a list of any outstanding deficiencies to be corrected by the\n               Contractor.\n\n          2.   The Contractor shall, as soon as reasonably practicable, correct\n               such deficiencies and complete the Work or Upgrade Work indicated\n               on all such listed items so as to comply in all material respects\n               with the requirements of this Contract, provided that the\n               Purchaser allows Contractor the necessary access to the\n               Segment(s) as the Contractor needs to correct such deficiencies\n               and complete the Work or Upgrade Work. The Contractor shall give\n               the Purchaser reasonable notice of its requirement for such\n               access.\n\n     D.   Commercial Acceptance\n\n          1.   A Certificate of Commercial Acceptance shall be issued by\n               Purchaser with respect to a Segment, the System or System Upgrade\n               if the results of the Acceptance Testing demonstrate that such\n               Segment, the System or such System Upgrade does not justify the\n               issuance of a Certificate of Provisional Acceptance, but\n               nevertheless, such Segment, the System or such System Upgrade is\n               Ready for Commercial Acceptance; provided, that such acceptance\n                                                --------                      \n               of a Segment instead of the System shall be in the sole\n               discretion of the Purchaser.\n\n          2.   Each Certificate of Commercial Acceptance shall have annexed to\n               it a mutually agreed list of all outstanding items to be\n               completed by the Contractor.\n\n          3.   The Contractor shall, as soon as reasonably practicable, remedy\n               the outstanding items, provided that the Purchaser allows\n               Contractor the necessary access to the Segment(s) as the\n               Contractor needs to remedy such outstanding items. The Contractor\n               shall give the Purchaser\n\n \n                                                                              27\n\n               reasonable notice of its requirement for such access.\n               Notwithstanding the above, provided that Contractor has been\n               allowed access to the Segment(s) as required in Sub-Article\n               9(A)(2), the Contractor shall continue to carry the risk of loss\n               for any outstanding item until such item is no longer\n               outstanding.\n\n          4.   When the outstanding items referenced in Sub-Article 9(D)(3)\n               above have been remedied, and the Segment(s) or System Upgrade is\n               otherwise Ready for Provisional Acceptance, the Purchaser will\n               promptly issue a Certificate of Provisional Acceptance; provided,\n                                                                       -------- \n               that acceptance of a Segment instead of the System shall be in\n               the sole discretion of the Purchaser.\n\n          5.   The issuance of a Certificate of Commercial Acceptance with\n               respect to a Segment or System Upgrade shall in no way relieve\n               the Contractor from its obligation to provide a Segment or System\n               Upgrade conforming with the Performance Requirements at the time\n               of the issuance of a Certificate of Commercial Acceptance.\n\n     E.   Final Acceptance\n\n          1.   Within thirty (30) days of the date of receipt by Purchaser and\n               Independent Engineer of the Final Commissioning Report, the\n               Purchaser shall issue a Certificate of Final Acceptance or reject\n               such Report. If the Purchaser neither issues a Certificate of\n               Final Acceptance nor rejects such Report within such thirty (30)\n               day period, then the Date of Final Acceptance of the System shall\n               be deemed to be the date such Final Commissioning Report was\n               received by the Purchaser.\n\n     F.   Title and Risk of Loss\n\n          1.   If the Purchaser, in its sole discretion, chooses to accept a\n               Segment prior to accepting the System, then upon payment of all\n               amounts listed in the Billing Schedule with respect to a Segment\n               (other than the Retainage with respect thereto) and the issuance\n               of a Certificate of Commercial Acceptance or a Certificate of\n               Provisional Acceptance with respect to such Segment by the\n               Purchaser in accordance with this Contract, title (free and clear\n               of all liens other than those deriving through or from the\n               Purchaser) to such Segment shall vest in the Purchaser.\n\n          2.   Upon (i) payment of all amounts listed in the Billing Schedule\n               with respect to the System (other than the Retainage) and (ii)\n               the issuance of a Certificate of Commercial Acceptance or a\n               Certificate of Provisional Acceptance with  respect to the System\n               by the Purchaser in accordance with this Contract, title (free\n               and clear of all liens other than those\n\n \n                                                                              28\n\n                 deriving through or from the Purchaser) to the System shall\n                 vest in the Purchaser.\n\n            3.   Upon payment of the Upgrade Price with respect to a System\n                 Upgrade and the issuance of a Certificate of Commercial\n                 Acceptance or a Certificate of Provisional Acceptance with\n                 respect to such System Upgrade by the Purchaser in accordance\n                 with this Contract, title to such System Upgrade shall vest in\n                 the Purchaser.\n\n            4.   As from the date of vesting of title in a Segment, the System\n                 or a System Upgrade, the Purchaser shall, except as set forth\n                 in the following sentence, assume the risk of loss in respect\n                 of all parts of such Segment, the System or System Upgrade and\n                 responsibility for its maintenance. As stated in Sub-Article\n                 9(A)(2), the Contractor will be allowed access to such Segment,\n                 and, so long as the Contractor has been allowed access to such\n                 Segment as may be required, the Contractor shall continue to\n                 carry the risk of loss with respect of each item outstanding\n                 under Sub-Article 9(C)(1) and 9(D)(2) until such item is no\n                 longer outstanding.\n\nARTICLE 10  WARRANTY\n--------------------\n\n     A.     The Contractor warrants that the System and each System Upgrade,\nincluding its spares, shall be free from defects in supplies, workmanship and\ndesign for a period of * years commencing from the Date of Provisional\nAcceptance of the System or such System Upgrade, as the case may be,\n(hereinafter \"Warranty Period\" and \"Upgrade Warranty Period\"), with Ship Costs\nbeing covered for the first * years of the Warranty Period (the \"Ship Period\")\nand the Purchaser being responsible for all Ship Costs thereafter.\n\n            1.   During the Warranty Period for the System or the Upgrade\n                 Warranty Period for a System Upgrade, the Contractor shall make\n                 good, by repair or replacement, at its sole option, any defects\n                 in the System or such System Upgrade, as the case may be,\n                 including any spares, which may become apparent or be\n                 discovered due to imperfect workmanship, faulty design or\n                 faulty material supplied by the Contractor, or any act, neglect\n                 or omission on the Contractors part.\n\n                 (a)  If at any time within the Warranty Period or the Upgrade\n                      Warranty Period for a System Upgrade any defect occurs\n                      which causes the System or such System Upgrade, as the\n                      case may be, to fail to meet its overall Performance\n                      Requirements, the Contractor shall repair or replace such\n                      part or parts. In making such repairs, Contractor may make\n                      changes to the System or such System Upgrade, as the case\n                      may be, or substitute equipment of later or comparable\n                      design, provided the changes, modifications, or\n                      substitutions under normal and proper use do\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              29\n\n                      not cause the System or such System Upgrade as the case\n                      may be to fail to meet the Performance Requirements.\n\n                 (b)  The Contractor shall use reasonable efforts to minimize\n                      the period of time that any Segment or the System is out\n                      of service for testing and repair. The Purchaser agrees to\n                      cooperate with the Contractor to facilitate the\n                      Contractor's repair activity.\n\n                 (c)  It is understood that if there is a problem on the System,\n                      the Purchaser may immediately dispatch the maintenance\n                      authority to effect repairs. If and to the extent that\n                      such problem is determined to be caused by a defect in the\n                      System covered by this warranty, the Contractor shall\n                      reimburse the Purchaser for its actual Non-Ship Costs\n                      incurred and, with respect to any such repair relating to\n                      a defect identified in good faith by Purchaser in writing\n                      prior to the end of the Ship Period, actual Ship Costs\n                      incurred.\n\n                      (i)   The Contractor shall be given advance notice and be\n                            entitled to have a representative on board ship to\n                            observe at sea repairs and shall be given the\n                            earliest possible notice of any such repair.\n\n                      (ii)  Subject to the foregoing and to Sub-Article 10(D),\n                            any repair by the Purchaser shall not in any way\n                            diminish the Contractor's obligation under the\n                            warranty. Any equipment discovered to be defective\n                            or faulty and recovered during a warranty repair\n                            shall be returned to the Contractor at its request.\n\n                 (d)  In the event that the Contractor fails to make the repair\n                      or to make reasonable efforts to minimize the period of\n                      time that the System is out of service for repair, the\n                      Purchaser may repair the System or the System Upgrade and\n                      the Contractor shall reimburse the Purchaser for Non-Ship\n                      Costs and, with respect to any such repair relating to a\n                      defect identified in good faith by Purchaser in writing\n                      prior to the end of the Ship Period, Ship Costs.\n\n                      (i)   The Contractor shall be given advance notice and be\n                            entitled to have a representative on board ship to\n                            observe at sea repairs and shall be given the\n                            earliest possible notice of any such repair.\n\n                      (ii)  Subject to the foregoing, any repair by the\n                            Purchaser shall not in any way diminish the\n                            Contractor's obligation\n\n \n                                                                              30\n\n                            under the warranty. Any equipment discovered to be\n                            defective or faulty and recovered during a warranty\n                            repair shall be returned to the Contractor at its\n                            request.\n\n            2.   Contractor shall bear the Ship Costs of only those repairs of\n                 the defects identified in good faith by Purchaser in writing\n                 prior to the end of the Ship Period. However, the Contractor\n                 shall bear the Non-Ship Costs of each repair, replacement or\n                 improvement required during the Warranty Period.\n\n                 As used herein, \"Ship Cost\" means the costs of operating a\n                 vessel, including but not limited to running and standing\n                 charges for the vessel (including but not limited to labor\n                 charges for the vessel's crew, at sea insurance, port charges,\n                 fuel and lube oils, consumables, cable loading, cable\n                 unloading, navigation and maritime communications) as well as\n                 the costs associated with the use and operation of a remotely\n                 operated vehicle and the tracked self-propelled burial tool,\n                 and \"Non-Ship Costs\" means the costs of making a repair,\n                 including the cost of components, equipment or materials\n                 requiring replacement, the cost of any additional equipment\n                 necessary to effect the repair, the cost of making the repair,\n                 including the cost of reburying any previously buried portion,\n                 the cost of labor and engineering assistance or development\n                 required to make the repair and all necessary associated costs,\n                 such as, but not limited to, shipping and customs and services\n                 that may be required to make the repair, but excluding any of\n                 the foregoing which are Ship Costs.\n\n            3.   The Contractor shall effect all warranty repairs of the System\n                 and shall supply all necessary repair materials. However, the\n                 Contractor may use, with the consent of the Purchaser, which\n                 shall not be unreasonably withheld, the materials needed to\n                 effect a repair from the Purchaser's available spare materials.\n                 The Contractor shall promptly replace in kind such materials\n                 supplied from the Purchaser's spare materials, or at the option\n                 of the Purchaser, reimburse the Purchaser for such materials at\n                 its original purchase price. The replacement of or\n                 reimbursement for such materials shall be made at a time\n                 mutually agreed to by the Purchaser and the Contractor.\n\n            4.   The Contractor warrants that services furnished hereunder will\n                 be performed in a workmanlike manner using materials free from\n                 defects except when such materials are provided by the\n                 Purchaser (it being understood that all materials arranged for\n                 directly by Contractor, whether or not purchased in the name of\n                 Purchaser, are not materials provided by the Purchaser). If\n                 such services prove to be not so performed and Purchaser\n                 notifies the Contractor within six (6) months from the\n                 completion of the service, the Contractor will promptly correct\n                 the defect.\n\n \n                                                                              31\n\n          5.  Any part which replaces a defective part during the applicable\n              Warranty Period or Upgrade Warranty Period, shall be subject to\n              the remaining Warranty Period and Ship Period, if any, or Upgrade\n              Warranty Period, as the case may be, of the part which was\n              replaced. However, the Warranty Period shall never exceed * years\n              from the Date of Provisional Acceptance of the System and the\n              Upgrade Warranty Period for any System Upgrade shall never exceed\n              * years from the Date of Provisional Acceptance of such System\n              Upgrade. Further, Ship Costs shall be included only with respect\n              to defects identified in good faith by Purchaser in writing during\n              the first * years from the Date of Provisional Acceptance of the\n              System.\n\n     B.   *\n\n\n     C.   The Contractor warrants that all Deliverable Software and Deliverable\nTechnical Materials are Year 2000 Compliant.\n\n     D.   The warranties provided above in Sub-Articles 10(A) and (B) by the\nContractor shall not apply to defects or failures of performance, which result\nfrom damage caused by acts or omissions of the Purchaser or its agents,\nemployees or representatives or third parties (other than the Contractor), or\nwhich result from modifications, misuse, neglect, accident or abuse, repair,\nstorage or maintenance by other than the Contractor or its agents or use in a\nmanner not in accordance with the System Description or other causes set forth\nin Article 12 (Purchaser's Obligations) or Article 17 (Force Majeure).\n\n     E.   THE FOREGOING WARRANTY IS EXCLUSIVE AND IS IN LIEU OF ALL OTHER\nEXPRESS AND IMPLIED WARRANTIES INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF\nMERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WHICH ARE SPECIFICALLY\nDISCLAIMED.  THE PURCHASER'S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO DEFECTS\nCOVERED BY THE FOREGOING WARRANTY SHALL (EXCEPT AS SET FORTH IN SUB-ARTICLE B\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              32\n\nABOVE) BE THE CONTRACTOR'S OBLIGATION TO MAKE REPAIRS OR REPLACEMENTS AS SET\nFORTH IN THIS ARTICLE; PROVIDED, THAT CONTRACTOR'S FAILURE TO SO PERFORM SHALL\n                       --------                                               \nBE SUBJECT TO ARTICLE 13 HEREOF.\n\n     F.   The Contractor shall, in accordance with its normal operating\npractices, investigate any defective part or parts repaired or replaced pursuant\nto this Article 10 to determine the type of defect and the cause of failure of\nthe part or parts. The Contractor shall provide a written report to the\nPurchaser on the results of the investigation, if any.\n\nARTICLE 11  CONTRACTOR SUPPORT\n------------------------------\n\n     A.   For a period of ten (10) years from the applicable Date of Provisional\nAcceptance or Date of Commercial Acceptance of the System whichever is earlier,\nthe Contractor will make available to the Purchaser replacement parts and repair\nservice for the System as may be reasonably necessary for its operation,\nmaintenance or repair. Where identical parts cannot be supplied, the Contractor\nshall provide fully compatible parts with characteristics equal or superior to\nthose originally provided by the Contractor. Such parts and services shall be\nprovided under commercially reasonable conditions of price and delivery.\n\n     B.   Notwithstanding Sub-Article 11(A), if for any reason the Contractor or\nContractor's suppliers intend to cease or ceases manufacturing or having\nmanufactured identical or fully compatible replacement parts, the Contractor\nshall use reasonable efforts to give one year's prior written notice to the\nPurchaser to allow the Purchaser to order from the Contractor any required\nreplacement parts and shall provide full details of the arrangements to provide\nequivalents.\n\nARTICLE 12  PURCHASER'S OBLIGATIONS\n-----------------------------------\n\n     A.   Purchaser agrees to pay all amounts payable by it when due under this\nContract and to perform all of its other obligations under this Contract.\n\n     B.   In the event the Purchaser establishes a branch office in any of the\nrelevant jurisdictions, the Purchaser shall be solely responsible to perform all\nactivities necessary to establish such branch office.\n\n     C.   If any loss, damage, delay or failure of performance of the System or\na System Upgrade results from the Purchaser's failure to perform its obligations\nunder this Contract and results in an increase in the costs of performance or\nthe time required for performance of any of the Contractor's duties or\nobligations under this Contract, the Contractor shall be entitled, as\nappropriate, to (i) an equitable adjustment in the Contract Price or applicable\nUpgrade Price, (ii) an equitable extension of time for completion of its Work or\nthe Upgrade Work, (iii) reimbursement for all such additional costs incurred,\nand (iv) to the extent necessary in light of Purchaser's failure and the\nadjustments made in accordance with clauses (i), (ii) and (iii) above, an\nequitable adjustment of the Work and\/or Upgrade Work.\n\n \n                                                                              33\n\n          1.   The Contractor shall inform the Purchaser promptly of any\n               occurrence covered under this Sub-Article 12(C), and shall use\n               reasonable efforts to minimize any such additional costs or\n               delay.\n\n          2.   The Contractor shall promptly provide to the Purchaser an\n               estimate of the anticipated additional costs and time required to\n               complete the Work or Upgrade Work and request relief from\n               contractual obligations or duties, as appropriate. Purchaser\n               shall, upon notification, make advance payment to Contractor for\n               the estimated amount of anticipated additional costs; provided\n                                                                     --------\n               that Purchaser may deposit such amount into the Dispute Account\n               and Sub-Article 5(C)(5) shall apply. Contractor shall without\n               limiting Purchaser's obligations in the foregoing sentence,\n               discuss such costs with Purchaser upon Purchaser's request.\n\n          3.   As soon as reasonably practicable after the actual costs become\n               known to the Contractor, the Contractor shall provide a statement\n               of such actual costs to the Purchaser.\n\n          4.   If the estimated amount is greater than the amount of actual\n               costs, then the Contractor shall reimburse the Purchaser. If the\n               amount of actual costs incurred is greater than the estimated\n               amount, then the Purchaser shall reimburse the Contractor for any\n               shortfall in accordance with Article 5 (Terms of Payment of\n               Purchaser).\n\nARTICLE 13  TERMINATION FOR DEFAULT\n-----------------------------------\n\n     A.   Either Party may, by written Notice of Termination for Default,\nimmediately upon receipt or such later date as specified in the notice,\nterminate the whole or any part of this Contract in any one of the following\ncircumstances (each an \"Event of Default\"):\n\n          1.   In the case of the Purchaser, (a) if Contractor materially fails\n               to comply with the terms and conditions of this Contract and, if\n               such failure occurs prior to the Date of Commercial Acceptance or\n               the Date of Provisional Acceptance, it would not be reasonable to\n               believe that the Contractor will be able to provide the System\n               which is Ready for Provisional Acceptance, within 200 days after\n               the Scheduled System RFS Date or (b) the Contractor fails to\n               cause the System to be Ready for Commercial Acceptance or\n               Provisional Acceptance within 200 days after the Schedule RFS\n               Date;\n\n          2.   If the other Party defaults on any of its payment obligations and\n               does not cure such default within a period of thirty (30) days\n               (or such longer period as the non-breaching Party may authorize\n               in writing) after receipt of written notice demanding cure\n               (subject to dispute provisions);\n\n \n                                                                              34\n                                                                            \n          3.   If the other Party shall commence a voluntary case or other\n               proceeding seeking liquidation, reorganization or other relief\n               with respect to itself or its debts under any bankruptcy,\n               insolvency or other similar law now or hereafter in effect or\n               seeking the appointment of a trustee, receiver, liquidator,\n               custodian or other similar official of it or any substantial part\n               of its property, or shall consent to any such relief or to the\n               appointment of or taking possession by any such official in an\n               involuntary case or other proceeding commenced against it, or\n               shall make a general assignment for the benefit of creditors, or\n               shall fail generally to pay its debts as they become due, or\n               shall take any corporate action to authorize any of the\n               foregoing;\n\n          4.   If an involuntary case or other proceeding shall be commenced\n               against the other Party seeking liquidation, reorganization or\n               other relief with respect to it or its debts under any\n               bankruptcy, insolvency or other similar law now or hereafter in\n               effect or seeking the appointment of a trustee, receiver,\n               liquidator, custodian or other similar official of it or any\n               substantial part of its property, and such involuntary case or\n               other proceeding shall remain undismissed and unstayed for a\n               period of 60 days; or an order for relief shall be entered\n               against the other Party.\n\n     B.   If this Contract is terminated by the Purchaser as provided in Sub-\nArticle 13(A), the Purchaser, in addition to any other rights provided in this\nArticle and upon payment to Contractor of all monies due and owing as set forth\nin clauses 1 and 2 of Sub-Article 13(C) below, may require the Contractor to\ntransfer title and deliver to the Purchaser in the manner and to the extent\ndirected by the Purchaser any completed equipment, material or supplies, and\nsuch partially completed cable and materials, parts, tools, dies, jigs,\nfixtures, plans, drawings, information, and contract rights (hereinafter\ncollectively \"Manufacturing Materials\") as the Contractor has had specifically\nproduced or specifically acquired for the performance of such part of this\nContract as has been terminated and which, if this Contract had been completed,\nwould have been required to be furnished to the Purchaser; and the Contractor\nshall, upon the direction of the Purchaser, protect and preserve property in the\nContractor's possession in which the Purchaser has an interest.\n\n     C.   If the Contract is terminated by Contractor as provided in Sub-Article\n13(A), the Purchaser shall pay, in addition to any other damages payable\npursuant to Sub-Article 13(E) below, the total of:\n\n          1.   the cost of settling and paying claims rising out of the\n               termination of Work under the contracts in orders, as provided in\n               Sub-Article 13(C)(2) below which are properly chargeable to the\n               terminated portion of this Contract; and\n\n          2.   the reasonable costs of settlement including accounting, legal,\n               clerical and other expenses necessary for the preparation of\n               settlement claims and supporting data with respect to the\n               terminated portion of this\n\n \n                                                                              35\n\n               Contract and for termination and settlement of contracts\n               thereunder, together with reasonable storage, transportation and\n               other costs incurred in connection with the protection,\n               preservation and disposition of property proper to this Contract.\n\n     D.   Force Majeure events pursuant to Article 17 (Force Majeure) shall not\nconstitute a default or provide a basis for termination under this Article.\n\n     E.   Regardless of any termination of this Contract as provided in Sub-\nArticle 13(A), neither Party shall be relieved from any liability for damages or\notherwise which may have been incurred by reason of any breach of this Contract.\n\n     F.   Without limitation to the foregoing, in the event that Purchaser\nterminates this Contract pursuant to Sub-Article 13(A), the Contractor shall be\nliable to Purchaser (without duplication) for the total of all costs and\nexpenses reasonably incurred by Purchaser in completing the Work or in\ncorrecting deficiencies in the Work to the extent that the payments made to\nContractor pursuant to this Contract, together with such costs and expenses,\nexceed the Contract Price.\n\nARTICLE 14  TERMINATION FOR CONVENIENCE\n---------------------------------------\n\n     A.   The performance of Work under this Contract may be terminated by the\nPurchaser in whole, or in part, at its discretion. The Purchaser shall deliver\nto the Contractor a written notice specifying the extent to which performance of\nWork under this Contract is terminated, and the date upon which such termination\nbecomes effective (a \"Notice of Termination\"). Upon termination, the Purchaser\nwill make payment to Contractor of all monies due and owing as set forth in Sub-\nArticle 14(D) below.\n\n     B.   After receipt of such Notice of Termination, and except as otherwise\ndirected by the Purchaser, the Contractor shall:\n\n          1.   Stop Work under this Contract on the date and to the extent\n               specified in the Notice of Termination;\n\n          2.   Place no further orders or contracts for materials, services or\n               facilities except as may be necessary for completion of such\n               portion of Work under this Contract as is not terminated;\n\n          3.   Use reasonable efforts to terminate all orders and contracts to\n               the extent that they relate to the performance of Work terminated\n               by the Notice of Termination;\n\n          4.   Assign to the Purchaser, in the manner, at the time, and to the\n               extent directed by the Purchaser, all of the Contractor's rights,\n               title and interest under the orders and contracts so terminated;\n\n \n                                                                              36\n\n          5.   Use reasonable efforts to settle all outstanding liabilities and\n               all claims arising out of such termination of orders and\n               contracts, with the Purchaser's approval or ratification to the\n               extent required;\n\n          6.   Transfer title and deliver to the Purchaser in the manner, at the\n               time and to the extent (if any) directed for the fabricated or\n               unfabricated parts, work in process, completed work, supplies and\n               other material produced as a part of, or acquired in connection\n               with, the performance of the Work terminated by the Notice of\n               Termination;\n\n          7.   Use reasonable efforts to sell, in the manner, at the time, to\n               the extent and at the price or prices directed or authorized by\n               the Purchaser, any property of the types referred to in Sub-\n               Article 13(B)(6) above provided, however, that the Contractor:\n                                      --------  -------                      \n\n               (a)  shall not be required to extend credit to any buyer; and\n\n               (b)  may acquire any such property under the conditions\n                    prescribed by and at a price approved by the Purchaser;\n\n               and provided further that the net proceeds of any such transfer\n                   -------- -------                                           \n               or disposition shall be applied in reduction of any payments to\n               be made by the Purchaser to the Contractor under this Contract\n               or, if no such payments are due, paid in such other manner as the\n               Purchaser may direct;\n\n          8.   Complete performance of such part of the Work which was not\n               terminated by the Notice of Termination; and\n\n          9.   Take such action as may be necessary, or as the Purchaser may\n               reasonably direct, for the protection and preservation of the\n               property related to this Contract which is in the Contractor's\n               possession and in which the Purchaser has acquired or may acquire\n               an interest.\n\n     C.   After such Notice of Termination, the Contractor shall submit to the\nPurchaser a written termination claim. Such claim shall be submitted promptly,\nbut, unless otherwise extended, in no event later than six months from the\neffective date of termination.\n\n     D.   In the settlement of any such partial or total termination claim, the\nPurchaser shall pay to the Contractor the total of:\n\n          1.   (i) all amounts invoiced in accordance with the Contract plus,\n               for Work or Supplies which have been done or provided but which\n               have not been invoiced, an amount calculated by reference to the\n               prices set forth in the Provisioning Schedule and to the amount\n               of such Work or Supplies done or provided;\n\n \n                                                                              37\n\n          2.  the cost of settling and paying claims arising out of the\n              termination of Work under the contracts in orders, as provided in\n              Sub-Article 14(D)(4) below which are properly chargeable to the\n              terminated portion of this Contract; and\n\n          3.   the reasonable costs of settlement including accounting, legal,\n               clerical and other expenses necessary for the preparation of\n               settlement claims and supporting data with respect to the\n               terminated portion of this Contract and for termination and\n               settlement of contracts thereunder, together with reasonable\n               storage, transportation and other costs incurred in connection\n               with the protection and disposition of property proper to this\n               Contract.\n\n     E.   In arriving at the amount due to the Contractor under this Article 14,\nall unliquidated payments made to the Contractor, any liability which the\nContractor may have to the Purchaser, and the agreed price for, or the proceeds\nof sale of any materials, supplies or other things acquired by the Contractor or\nsold, pursuant to the provisions of this Article 14, and not otherwise recovered\nby or credited to the Purchaser shall be deducted.\n\n     F.   The Purchaser may, from time to time, under such terms and conditions\nas they prescribe approve partial payments and payments on account against costs\nincurred by the Contractor in connection with the terminated portion of this\nContract. If such payments total in excess of the amount finally agreed or\ndetermined to be due under this Article 14, such excess shall be refunded, upon\ndemand, by the Contractor to the Purchaser.\n\n     G.   For a period of one year after final settlement under this Contract,\nthe Contractor shall preserve and make available to the Purchaser at reasonable\ntimes at the Contractor's office, but without direct charge to the Purchaser,\nall supporting books, records and documents required to be kept relating to the\nterminated Work.\n\nARTICLE 15  SUSPENSION\n----------------------\n\n     A.   The Purchaser may, at its convenience, order the Contractor to suspend\nall or part of the Work for such period of time as the Purchaser determines to\nbe appropriate. If, as a result of such Suspension, the Contractor incurs\nadditional costs or losses in the discharge of its responsibilities under this\nContract, and where such suspension, losses or costs are not caused by the\nContractor's act or omission and could not have been reasonably prevented by the\nContractor, the Contractor shall be allowed an equitable adjustment to the\nContract Price or the Provisioning Schedule in Appendix 1 and an equitable\nextension in the time required for performance.\n\n     B.   Upon the occurrence of:\n\n          (i) an Event of Default by the Purchaser;\n\n \n                                                                              38\n\n          (ii) any transfer prior to the Date of Final Acceptance of any portion\n     of the System except in accordance with Article 37; or\n\n          (iii)    any supplement executed by a Transferee shall not be in full\n     force and effect;\n\nthe Contractor, in addition to any other rights provided in Article 13, may\nsuspend performance of its obligations and all Work and (in the case of clause\n(i)) Upgrade Work.\n\n     C.  Every forty-five (45) days, during the period of Suspension, the\nParties shall meet formally and review the circumstances surrounding the\nSuspension including without limitation, the anticipated date of re-commencing\nWork.\n\n     D.  Thereafter, if the Suspension continues for a total of one hundred and\neighty (180) days, the Contractor may terminate the Contract by notice to the\nPurchaser and the Contract shall be deemed to have been terminated by Purchaser,\neffective on the date of Contractor's notice, in accordance with Sub-Article\n13(A) and the remaining provisions of Article 13 shall apply.\n\nARTICLE 16  TITLE AND RISK OF LOSS\n----------------------------------\n\n     A.  Except as provided in Article 18 (Intellectual Property), Article 20\n(Safeguarding of Information and Technology) and Article 21 (Export Control),\ntitle to all Supplies provided by the Contractor hereunder for incorporation in\nor attachment to a Segment shall pass to and vest in the Purchaser in accordance\nwith Article 9 (Acceptance). Risk of loss or damage to all Supplies provided by\nthe Contractor for incorporation in or attachment to such Segment shall pass to\nand vest in the Purchaser in accordance with Article 9. Upon termination of this\nContract pursuant to Article 13 (Termination for Default) or 14 (Termination for\nConvenience), the Purchaser may require, upon full payment of all amounts due\nthereunder (provided that, without limiting Purchaser's obligation to make any\n            --------                                                          \nsuch payment, if this Contract is terminated by Purchaser because of a\nBankruptcy Event full payment shall not be required prior to the transfer of\ntitle), that title to the equipment, materials and supplies, which has not\npreviously passed to the Purchaser, pass to the Purchaser, free and clear of all\nliens, claims, charges and other encumbrances other than those deriving through\nPurchaser.\n\n     B.  Upon the passage of title in accordance with the terms of Article 13\n(except a transfer described in the proviso of the last sentence of Sub-Article\n16(A)), the Contractor warrants that all parts, materials, and equipment to\nwhich title has passed will be free and clear of all liens, claims, charges and\nother encumbrances other than those deriving through the Purchaser.\n\nARTICLE 17  FORCE MAJEURE\n-------------------------\n\n     A.  The Contractor shall not be responsible for any loss, damage, delay or\nfailure of performance resulting directly or indirectly from any cause which is\nbeyond its reasonable control (\"Force Majeure\"), including but not limited to:\ndelay in obtaining or failure to obtain\n\n \n                                                                              39\n\nany Permits (subject to the provisions of Sub-Article 7(D)); acts of God or of\nthe public enemy; acts or failure to act of any governmental authority; war or\nwarlike operations, civil war or commotion, mobilizations or military call-up,\nand acts of similar nature; revolution, rebellions, sabotage, and insurrections\nor riots; fires, floods, epidemics, quarantine restrictions; strikes, and other\nlabor actions; freight embargoes; unworkable weather; trawler or anchor damage;\ndamage caused by other marine activity such as fishing, marine research and\nmarine development; acts or omissions of transporters; or the acts or failure to\nact of any of the Purchaser, of its representatives or agents, provided that (i)\n                                                               --------         \na loss by Contractor of employees (other than by reasons of Force Majeure), (ii)\nstrikes and other labor actions involving the Contractor's own work force, (iii)\nthe first 5 days of unworkable weather (unless any such day occurs during the 30\ndays immediately preceding the then Scheduled System RFS Date or Scheduled\nSegment S RFS Date), (iv) the failure (other than by reason of force majeure) of\nany subcontractor, supplier or transporter to perform its obligations to\nContractor (including on account of insolvency) unless such supplies or\ntransportation or other services are generally unavailable in the marketplace,\n(v) the unavailability of any raw materials or components, unless such raw\nmaterials or components are generally unavailable in the marketplace or are\nunavailable by reason of force majeure or (vi) any increase in Contractor's\ncosts, shall not in and of itself constitute Force Majeure.\n\n     B.  If any such Force Majeure causes an increase in the time required for\nperformance of any of its duties or obligations, the Contractor shall be\nentitled to an equitable extension of time for completion of the Work or the\nUpgrade Work, as the case may be.\n\n     C.  Increase in cost due to Purchaser will be as provided for in Article\n12, Purchaser's Obligations.\n\n     D.  The Contractor shall inform the Purchaser promptly with written\nnotification, and in all cases within fourteen (14) days of discovery and\nknowledge, of any occurrence covered under this Article and shall use its\nreasonable efforts to minimize such additional delays. The Contractor shall\npromptly provide an estimate of the anticipated time required to complete the\nWork or the Upgrade Work.  Contractor shall be entitled to an extension of time\nequal to at least one day for each day of delay resulting from the Force Majeure\ncondition.\n\n     E.  Within thirty (30) days of receipt of such a notice from Contractor,\nthe Purchaser and the Independent Engineer may provide a written response. The\nabsence of a response shall be deemed as acceptance of Contractor's notice and\nrequest for additional time.\n\n     F.  If a Force Majeure continues for a total of two hundred (200) days,\neither Party may terminate the Contract by notice to the other and the Contract\nshall be deemed to have been terminated by Purchaser, effective on the date of\nthe terminating Party's notice, in accordance with Sub-Article 14(A) and the\nremaining provisions of Article 14 shall apply to such termination.\n\nARTICLE 18  INTELLECTUAL PROPERTY\n---------------------------------\n\n     A.  Ownership\n\n \n                                                                              40\n\n         All right, title, and interest in and to all Intellectual Property\n(excluding Project Patent Rights) created or developed by Contractor in the\ncourse of its performance under this Contract that is (a) specifically and\nexclusively applicable to the System or a System Upgrade; and (b) either (i)\nembodied in Deliverable Technical Material (as that term is defined in Sub-\nArticle 18(B) below) or (ii) embodied in the System or a System Upgrade (the\n\"Project Intellectual Property\"), is and shall remain the sole property of\nPurchaser.  All right, title and interest in and to all Intellectual Property\ncreated or developed by Contractor before commencing its performance under this\nContract, or created or developed by Contractor exclusively in connection with\nactivities other than its performance under this Contract, or created or\ndeveloped by Contractor in the course of its performance under this Contract\nthat is not Project Intellectual Property, and all Project Patent Rights\n(collectively, the \"Contractor Intellectual Property\"), is and shall remain the\nsole property of Contractor.  Unless otherwise expressed in this Contract, no\nlicense is implied or granted herein to Purchaser to any Contractor Intellectual\nProperty by virtue of this Contract, nor by the transmittal or disclosure of any\nsuch Contractor Intellectual Property to Purchaser.  Any Contractor Intellectual\nProperty disclosed, furnished, or conveyed to Purchaser that is marked as\n\"Proprietary\" or \"Confidential\" (or if transmitted orally is identified as being\nproprietary or confidential in a subsequent writing) shall be treated in\naccordance with the provisions of Article 20 (Safeguarding of Information and\nTechnology).  As used herein, \"Intellectual Property\" means any information,\ncomputer or other apparatus programs, software, specifications, drawings,\ndesigns, sketches, tools, market research or operating data, prototypes,\nrecords, documentation, works of authorship or other creative works, ideas,\nconcepts, methods, inventions, discoveries, improvements, or other business,\nfinancial and\/or technical information (whether or not protectable or\nregistrable under any applicable intellectual property law).  As used herein,\n\"Project Patent Rights\" means all inventions, discoveries, methods and\nimprovements of a patentable nature created or developed by Contractor in the\ncourse of its performance under this Contract.  Project Intellectual Property\nwill include the materials to be listed in a Schedule to be created mutually by\nthe Parties within thirty (30) days of execution of this Contract, as it may be\namended from time to time by mutual agreement of the Parties.\n\n     B.  Licenses\n\n         Contractor shall furnish to Purchaser, upon the transfer of title to\nany portion of the System or a System Upgrade pursuant to Article 9, copies of\nall technical information, specifications, drawings, designs, sketches, tools,\noperating data, records, documentation and\/or other types of engineering or\ntechnical data or information reasonably relating to the operation, maintenance\nor repair of each component of such portion of the System or System Upgrade as\ndelivered by Contractor (the \"Deliverable Technical Material\"). Contractor\ngrants to Purchaser a perpetual, royalty-free, non-transferable (except under\nthe circumstances specified in Sub-Article 18(F) below) license to use and\nreproduce those Deliverable Technical Materials owned, controlled, or developed\nby Contractor and all Contractor Intellectual Property included in or necessary\nto use all the Deliverable Technical Materials for purposes of fulfilling\nPurchaser's obligations under this Contract and using and operating the System\n(as upgraded by any System Upgrades) supplied by Contractor with the right to\nemploy third parties (under appropriate written obligations respecting\nconfidentiality) to assist Purchaser in fulfilling its obligations under this\nContract and in using and operating the\n\n \n                                                                              41\n\nSystem (as upgraded by any System Upgrades), but with no right to sublicense.\nContractor grants to Purchaser a perpetual, royalty-free, non-transferable\n(except under the circumstances specified in Sub-Article 18(F) below) license to\nuse and reproduce those portions of Deliverable Technical Materials owned or\ncontrolled by third parties (but only to the extent of any rights which may have\nbeen granted to Contractor by such third parties) for the purpose of fulfilling\nPurchaser's obligations under this Contract and using and operating the System\nsupplied by Contractor with the right to employ third parties (under appropriate\nwritten obligations respecting confidentiality) to assist Purchaser in\nfulfilling its obligations under this Contract and in using and operating the\nSystem (as upgraded by any System Upgrades), but with no right to sublicense.\nExcept as set forth in this provision, no license under Contractor's patents,\ncopyrights, trade or service marks, trade secrets or other intellectual property\nrights protectable under law in the United States or any foreign country is\ngranted to Purchaser. It is expressly understood that it shall not be a\nviolation of this license for Purchaser, on its own behalf or through third\nparties (under appropriate written obligations respecting confidentiality)\nspecifically employed for the purpose, to use and reproduce Deliverable\nTechnical Material that is not Project Intellectual Property to modify the\nSystem (as upgraded by any System Upgrades) or connect the System (as upgraded\nby any System Upgrades) to other systems, provided that Purchaser may not use\nthe Deliverable Technical Materials that is not Project Intellectual Property in\nachieving such modification or interconnection for any purpose other than\ndetermining the technical configuration, systems interface and\/or\ninteroperability requirements of the System (as upgraded by any System Upgrades)\nas delivered by Contractor (subject to the rights of third parties therein and\nthereto), and subject to the limitations on Contractor's obligations as set\nforth in Articles 10(D) and 19(A) concerning any such modification or\ninterconnection.\n\n     C.   Deliverable Software\n\n          Contractor shall furnish to the Purchaser, upon transfer of title to\nany portion of the System or System Upgrade pursuant to Article 9, copies of all\ncomputer or other apparatus programs and software, in executable form, and\nrelated documentation relating to the operation, maintenance, or repair of the\ncomputer systems of such portion of the System or System Upgrade, as the case\nmay be, as delivered by Contractor (the \"Deliverable Software\"). In the case of\nContractor Intellectual Property, such copies of programs and software shall\nconsist solely of executable code provided in offline media (e.g., tapes, or\ndiskettes) for restoration purposes, sufficient to operate, maintain or repair\nthe computer systems of such portion of the System or System Upgrade, as the\ncase may be, as delivered by Contractor, and in the case of Project Intellectual\nProperty, such programs and software shall be delivered in both source and\nobject code forms. Contractor shall furnish to Purchaser, from time to time\nduring the Warranty Period or any Upgrade Warranty Period, copies of all\ncomputer or other apparatus programs and software, in executable form (and in\nthe case of Project Intellectual Property, in source code form), and related\ndocumentation that Contractor may develop to correct errors or to maintain\nDeliverable Software previously furnished to Purchaser, which shall also be\ntreated as Deliverable Software for purposes of this Contract upon delivery\nthereof to Purchaser. Contractor grants to Purchaser a perpetual, royalty-free,\nnon-transferable (except under the circumstances specified in Sub-Article 18(F)\nbelow) license to use and reproduce the Deliverable Software Materials owned,\ncontrolled, or\n\n \n                                                                              42\n\ndeveloped by Contractor for the purpose of fulfilling Purchaser's obligations\nunder this Contract and using and operating the System (as upgraded by any\nSystem Upgrades) supplied by Contractor with the right to employ third parties\n(under appropriate written obligations respecting confidentiality) to assist\nPurchaser in fulfilling its obligations under this Contract and in using and\noperating the System (as upgraded by any System Upgrades), but with no right to\nsublicense. Contractor grants to Purchaser a perpetual, royalty-free, non-\ntransferable (except under the circumstances specified in Sub-Article 18(F)\nbelow) license to use and reproduce those portions of Deliverable Software owned\nor controlled by third parties (but only to the extent of any rights which may\nhave been granted to Contractor by such third parties) for the purpose of\nfulfilling Purchaser's obligations under this Contract and using and operating\nthe System (as upgraded by any System Upgrades) supplied by Contractor with the\nright to employ third parties (under appropriate written obligations respecting\nconfidentiality) to assist Purchaser in fulfilling its obligations under this\nContract and in using and operating the System (as upgraded by any System\nUpgrades), but with no right to sublicense. These licenses shall be limited to\nthe right to use Deliverable Software that is not Project Intellectual Property\nonly with the particular type of computer equipment or substantially similar\nreplacement equipment for which such Deliverable Software was provided in the\nSystem (as upgraded by any System Upgrades) as supplied by Contractor.\n\n          1.   Confidentiality\n               Purchaser shall keep the Deliverable Software that is not Project\n               Intellectual Property confidential in accordance with Article 20\n               (Safeguarding of Information and Technology) and Article 21\n               (Export Control) to the extent that such Deliverable Software is\n               designated as Confidential Information by its owner and agrees to\n               use its best efforts to see that its employees, consultants, and\n               agents, and other users of such software, comply with the\n               provisions of this Contract. Purchaser also agrees to refrain\n               from taking any steps, such as reverse assembly or decompilation,\n               to derive a source code equivalent of any object code that is\n               furnished by Contractor, provided that Contractor continues to\n               maintain the Deliverable Software that is not Project\n               Intellectual Property in accordance with the terms of a support\n               and maintenance agreement to be entered into on such terms to be\n               agreed upon by the Parties, which terms shall in all events\n               contain assurances of support and maintenance at least as\n               favorable to Purchaser as those contained in the Operating,\n               Administration and Maintenance Agreement concerning AC-1 or is\n               willing and able to enter into an agreement to maintain the\n               Deliverable Software upon terms reasonably comparable to the\n               pertinent terms of the initial agreement to be entered into by\n               the Parties with regard to support and maintenance after the\n               expiration or termination thereof or does not go insolvent or\n               bankrupt to thereby trigger *. In the case of insolvency or\n               bankruptcy of Contractor, Purchaser shall limit any derivation of\n               a source code equivalent to that portion of the Deliverable\n               Software that is Contractor Intellectual Property. Purchaser\n               shall not under any circumstances take any steps to derive a\n               source code\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              43\n\n               equivalent from that portion of the Deliverable Software\n               comprising commercial, off-the-shelf software developed or\n               provided by third parties.\n\n          2.   Backup Copies\n               Purchaser may make and retain two archive copies in executable\n               form of the Deliverable Software that is not Project Intellectual\n               Property. Any copy will contain the same copyright notice and\n               proprietary markings as are on the original software and shall be\n               subject to the same restrictions as the originals.\n\n          3.   Termination of Software Licenses\n               In the event of (i) use by the Purchaser of Deliverable Software\n               that is not Project Intellectual Property in a manner other than\n               that permitted in Sub-Article 18(C) or (ii) any other material\n               breach of this Article 18 by Purchaser that in either event is\n               not cured within sixty (60) days from receipt by Purchaser of\n               written notice of such impermissible use or breach, Contractor,\n               at its option, may terminate the rights granted to Purchaser\n               pursuant to this Article, upon written notice to Purchaser, which\n               termination shall take effect no sooner than sixty (60) days\n               following receipt by Purchaser of a subsequent written notice of\n               termination. Upon termination, Purchaser shall either return or\n               destroy, at Contractor's option, all copies of Deliverable\n               Software that is not Project Intellectual Property furnished\n               under this Contract.\n\n          4.   Indemnification\n               In the event of (i) use by Purchaser of Deliverable Software that\n               is not Project Intellectual Property furnished hereunder other\n               than that permitted in Sub-Article 18(C) or (ii) any other\n               material breach of this Article 18 by Purchaser, the Purchaser\n               shall indemnify and hold Contractor harmless from any and all\n               third party claims resulting therefrom whether arising from a\n               defect in the software or otherwise.\n\n     D.   Trademarks, Tradenames, etc.\n\n          No rights are granted herein to either Party to use any identification\n(such as, but not limited to tradenames, trademarks, service marks or symbols,\nand abbreviations, contractions, or simulations thereof) owned or used by the\nother Party or its parent company or its affiliates to identify itself or its\naffiliates or any of its products or services. Each Party agrees that it will\nnot, without the prior written permission of the other Party, use such\nidentification in advertising, publicity, packaging, labeling, or in any other\nmanner to identify itself or any of its products, services, or organizations, or\nrepresent directly or indirectly that any product, service, or organization of\nit is a product, service, or organization of the other Party or its affiliates,\nor that any product or service of a Party is made in accordance with or utilizes\nany intellectual property of the other Party or its affiliates.\n\n \n                                                                              44\n\n     E.   DISCLAIMER, LIMITATION OF LIABILITY\n\n          CONTRACTOR REPRESENTS THAT ANY INFORMATION OR INTELLECTUAL PROPERTY\nFURNISHED IN CONNECTION WITH THIS CONTRACT SHALL BE TRUE AND ACCURATE TO THE\nBEST OF ITS KNOWLEDGE AND BELIEF, BUT CONTRACTOR SHALL NOT BE HELD TO ANY\nLIABILITY FOR UNINTENTIONAL ERRORS OR OMISSIONS THEREIN. EXCEPT AS EXPRESSLY\nPROVIDED, CONTRACTOR MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESSLY OR\nIMPLIEDLY. BY WAY OF EXAMPLE, BUT NOT OF LIMITATION, CONTRACTOR AND ITS PARENT\nCOMPANY AND AFFILIATES MAKES NO REPRESENTATIONS OR WARRANTIES OF MERCHANTABILITY\nOR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF INFORMATION OR\nINTELLECTUAL PROPERTY DISCLOSED OR PROVIDED HEREUNDER WILL NOT INFRINGE ANY\nPATENT OR OTHER INTELLECTUAL PROPERTY RIGHT OF A THIRD PARTY. EXCEPT AS\nOTHERWISE PROVIDED IN THIS CONTRACT, CONTRACTOR AND ITS PARENT AND AFFILIATES\nSHALL NOT BE HELD TO ANY LIABILITY WITH RESPECT TO ANY CLAIM BY PURCHASER OR ANY\nTHIRD PARTY CLAIM AGAINST PURCHASER ON ACCOUNT OF, OR ARISING FROM, PURCHASER'S\nUSE OF INFORMATION OR INTELLECTUAL PROPERTY DISCLOSED OR PROVIDED BY CONTRACTOR.\n\n     F.   Transferability\n\n          The licenses granted to Purchaser by Contractor in the Deliverable\nTechnical Materials and Deliverable Software are personal and non-transferable,\nexcept that Purchaser may assign or transfer such licenses to an affiliated\nentity under common control with the Purchaser or to any entity succeeding to\nPurchaser's entire interest in the System (as upgraded by any System Upgrades)\nas a result of reorganization or restructuring of the Purchaser or in the event\nof a change of control of the Purchaser.\n\n     G.   *\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              45\n\n*\n\n\nARTICLE 19 INFRINGEMENT\n-----------------------\n\n     A.   The Contractor agrees to defend or settle at its own expense all suits\nfor infringement of any patent, copyright, trademark or other form of\nintellectual property right in any country of the world, for the use and\noperation of the System (as upgraded by any System Upgrades) as supplied by\nContractor and for any component part thereof or material or equipment used\ntherein (or the manufacture of any material or the normal use thereof) provided\nby the Contractor or on its behalf pursuant to this Contract and will hold the\nPurchaser harmless from all expense of defending any such suit and all payments\nfor final judgment assessed on account of such infringement, except such\ninfringement or claim arising from:\n\n          1.   The Contractor's adherence to the Purchaser's directions in the\n               design and configuration of the System (as upgraded by any System\n               Upgrades) or to use materials, parts or equipment of the\n               Purchaser's selection; or\n\n          2.   Such material, parts or equipment furnished to the Contractor by\n               the Purchaser, other than in each case, items of the Contractor's\n               design or selection or the same as any of the Contractor's\n               commercial merchandise or in processes or machines of the\n               Contractor's design or selection used in the manufacture of such\n               standard products or parts; or\n\n          3.   Use of the System (as upgraded by any System Upgrades) or the\n               materials, parts or equipment furnished by Contractor other than\n               for the purposes indicated in, or reasonably to be inferred from,\n               this Contract or in conjunction with other products; or\n\n          4.   Modification of the System (as upgraded by any System Upgrades)\n               or the materials, parts or equipment furnished by the Contractor,\n               or connection of the System to another system by any person or\n               entity other than Contractor, without prior expressed written\n               approval by Contractor.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              46\n\n     B.   The Purchaser will, at its own expense, defend all suits against the\nContractor for such excepted infringement and hold the Contractor harmless from\nall expense of defending any such suit and from all payments by final judgment\nassessed against the Contractor on account of such excepted infringement.\n\n     C.   The Contractor and the Purchaser agree to give each other prompt\nwritten notice of claims and suits for infringement, full opportunity and\nauthority to assume the sole defense, including appeals and, upon request and at\nits own expense, the other agrees to furnish all information and assistance\navailable to it for such defense.\n\n     D.   If all or any portion of the System (as upgraded by any System\nUpgrades) or any material, part or equipment provided by the Contractor or on\nits behalf is held to constitute an infringement (excluding such excepted\ninfringements specified in Sub-Article 19(A)) and is subject to an injunction\nrestraining its use or any order providing for its delivery up to or\ndestruction, or if in respect of any such claim of infringement the Contractor\ndeems it advisable to do so, the Contractor shall at its own expense either:\n\n          1.   Procure for the Purchaser the right to retain and continue to use\n               the System, the affected portion thereof, or any such material,\n               part or equipment without interruption for the Purchaser;\n\n          2.   Replace or modify the System, the affected portion thereof, or\n               any material, part or equipment so that it becomes noninfringing\n               while continuing to meet the Performance Requirements or\n\n          3.   If the remedies specified in Sub-Articles 19(D)(1) an 19(D)(2)\n               are not feasible, refund to the Purchaser the full purchase price\n               paid for the System, the affected portion thereof, or any\n               material, part or equipment found to be infringing.\n\n     E.   In no event shall the Purchaser make any admission or settle any claim\nin relation with any claim for infringement without Contractor's consent.\n\nARTICLE 20  SAFEGUARDING OF INFORMATION AND TECHNOLOGY\n------------------------------------------------------\n\n     A.   In performance of this Contract, it may be mutually advantageous to\nthe Parties hereto to share certain specifications, designs, plans, drawings,\nsoftware, market research or operating data, prototypes, or other business,\nfinancial, and or\/technical information related to products, services, or\nsystems which are proprietary to the disclosing Party or its affiliates (and in\nthe case of Contractor, Contractor's parent company) (together with this\nContract and related documents, \"Information\"). The Parties recognize and agree\nthat Information includes information that was supplied in contemplation hereof\nprior to execution of this Contract, and further agree that Information includes\ninformation in both tangible and intangible form.\n\n     B.   Unless such Information was previously known to the Party receiving\nsuch Information free of any obligation to keep it confidential, or such\nInformation has been or is\n\n \n                                                                              47\n\nsubsequently made public through other than unauthorized disclosure by the\nreceiving Party or is independently developed by the receiving Party (as\ndocumented by the records of the receiving Party), it shall be kept confidential\nby the Party receiving such Information, shall be used only in the performance\nof this Contract, and may not be used for any other purposes except upon such\nterms as may be agreed upon in writing by the Party owning such Information. The\nreceiving Party may disclose such Information to other persons, upon the\nfurnishing Party's prior written authorization, but solely to perform acts which\nthis Article expressly authorizes the receiving Party to perform itself and\nfurther provided such other person agrees in writing (a copy of which writing\nwill be provided to the furnishing Party at its request) to the same conditions\nrespecting disclosure and use of Information contained in this Article and to\nany other reasonable conditions requested by the furnishing Party. Nothing\nherein shall prevent a Party from disclosing Information (a) upon the order of\nany court or administrative agency, (b) upon the request or demand of, or\npursuant to any regulation of, any regulatory agency or authority, (c) to the\nextent reasonably required in connection with the exercise of any remedy\nhereunder and (d) to a Party's legal counsel or independent auditors.\n\n     C.   The Purchaser may disclose Information to its lenders and their\nrepresentatives in connection with obtaining financing for the System, provided\nthat each such lender or third party enters into a confidentiality agreement\ncontaining terms and conditions similar to those in this Contract. Any such\ndisclosure of Information shall be subject to the restrictions in Sub-Article\n20(B).\n\nARTICLE 21 EXPORT CONTROL\n-------------------------\n\n          The Parties acknowledge that any products, software, and technical\ninformation (including, but not limited to, services and training) provided by\neither Party under this Contract are or may be subject to export laws and\nregulations of the United States and destination countries and any use or\ntransfer of such products, software and technical information must be authorized\nunder those Laws. The Parties agree that they will not use, distribute, transfer\nor transmit the products, software or technical information (even if\nincorporated into other products) except in compliance with export Laws. If\nrequested by either Party, the other Party agrees to sign all necessary export-\nrelated documents as may be required to comply with export Laws.\n\nARTICLE 22 LIQUIDATED DAMAGES\n-----------------------------\n\n     A.   If the System is not Ready for Commercial Acceptance or Provisional\nAcceptance by the Scheduled System RFS Date, as it may have been extended under:\n\n          1.   Article 6 (Contract Variations);\n\n          2.   Article 17 (Force Majeure); or\n\n          3.   Other arrangements as agreed between the Purchaser and the\n               Contractor;\n\n \n                                                                              48\n\nthen Contractor shall pay to Purchaser for each day of delay, for up to 200\ndays, by way of pre-estimated and liquidated damages for the delay and not as a\npenalty, an amount equal to * of the Initial Contract Price for the System less\nthat portion of the Initial Contract Price allocable to Segment S, provided that\nprior to the Scheduled System RFS Date, the Date of Provisional Acceptance for\nSegment S has occurred.\n\n     B.   If Segment S is not Ready for Commercial Acceptance or Provisional\nAcceptance within fifteen (15) days (the \"Grace Period\") following the Scheduled\nSegment S RFS Date, as it may have been extended under:\n\n          1.  Article 6 (Contract Variations)\n\n          2.  Article 17 (Force Majeure); or\n\n          3.  Other Arrangements as agreed between the Purchaser and Contractor;\n\nthen Contractor shall pay to Purchaser for each day of delay following the\nexpiration of the Grace Period, for up to 200 days, by way of pre-estimated and\nliquidated damages for the delay and not as penalty, an amount equal to * of\nthat portion of the Initial Contract Price of the System allocable to Segment S.\n\n     C.   If a System Upgrade is not Ready for Commercial Acceptance or\nProvisional Acceptance by the Scheduled Upgrade Date, as it may have been\nextended under:\n\n          1.  Article 6 (Contract Variations);\n\n          2.  Article 17 (Force Majeure); or\n\n          3.  Other arrangements as agreed between the Purchaser and the\n              Contractor;\n\nthen Contractor shall pay to Purchaser for each day of delay, for up to 90 days,\nby way of pre-estimated and liquidated damages for the delay and not as a\npenalty, an amount equal to * of the Initial Upgrade Price for such System\nUpgrade.\n\nARTICLE 23  LIMITATION OF LIABILITY\/INDEMNIFICATION\n---------------------------------------------------\n\n     A.   NOTWITHSTANDING ANY OTHER PROVISION IN THIS CONTRACT, AND IRRESPECTIVE\nOF ANY FAULT, NEGLIGENCE OR GROSS NEGLIGENCE OF ANY KIND, IN NO EVENT SHALL\nEITHER PARTY OR ANY OF ITS DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS BE LIABLE\nFOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, RELIANCE OR SPECIAL (INCLUDING\nPUNITIVE) DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOSS OF REVENUE, LOSS OF\nBUSINESS OPPORTUNITY OR THE COSTS ASSOCIATED WITH THE USE OF RESTORATION\nFACILITIES RESULTING FROM ITS FAILURE TO PERFORM PURSUANT TO THE TERMS AND\nCONDITIONS OF THIS CONTRACT.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              49\n\n     B.   EXCEPT AS SET FORTH BELOW IN THE LAST TWO SENTENCES OF THIS SUB-\nARTICLE 23(B), THE CONTRACTOR'S MAXIMUM AGGREGATE LIABILITY, WHETHER IN TORT,\nCONTRACT OR OTHERWISE, EXCEPT FOR CLAIMS RELATING TO SYSTEM UPGRADES, SHALL NOT\nEXCEED * OF THE CONTRACT PRICE. THE CONTRACTOR'S MAXIMUM AGGREGATE LIABILITY FOR\nCLAIMS RELATING TO SYSTEM UPGRADES (IF CONTRACTOR CAN PROVE THAT THE SYSTEM WAS\nDESIGNED WITH SUFFICIENT TRANSMISSION MARGIN AND THUS SUCH CLAIMS DO NOT ARISE\nUNDER CLAUSE (ii) OF SUB-ARTICLE 10(B)) SHALL NOT EXCEED * OF THE APPLICABLE\nUPGRADE PRICE. THE FOREGOING LIMITATION SHALL NOT APPLY TO CLAIMS UNDER SUB-\nARTICLES 19(A) AND 23(C). IF CONTRACTOR CANNOT PROVE THAT THE SYSTEM WAS\nDESIGNED WITH SUFFICIENT TRANSMISSION MARGIN FOR A SYSTEM UPGRADE, THE\nCONTRACTOR'S MAXIMUM AGGREGATE LIABILITY FOR CLAIMS ARISING UNDER CLAUSE (ii) OF\nSUB-ARTICLE 10(B) SHALL NOT EXCEED *.\n\n     C.   Contractor, at its expense, shall defend, indemnify and hold harmless\nPurchaser, its agents, subcontractors and employees against any and all claims,\ndemands, and judgments for losses due to any act or omission, arising out of, or\nin connection with this Contract or, prior to risk of loss passing to Purchaser,\nthe operation and maintenance of the System, to the extent such losses were\ncaused by the negligence or willful misconduct of the Contractor, its\nsubcontractors, employees or agents. The defense, indemnification and save\nharmless obligation is specifically conditioned on the following: (i) Purchaser\nproviding prompt notification in writing of any such claim or demand when it\nobtains Actual Knowledge thereof, unless such failure shall not have materially\nimpaired Contractor's ability to defend against such claim; (ii) Contractor\nhaving control of the defense of any such action, claim or demand and of all\nnegotiations for its settlement or compromise; and (iii) Purchaser cooperating,\nat Contractor's expense, in a reasonable way to facilitate the defense of such\nclaim or demand or the negotiations for its settlement.\n\n     D.   Purchaser, at its expense, shall defend, indemnify and hold harmless\nContractor, its agents, subcontractors and employees against any and all claims,\ndemands, and judgments for losses due to any act or omission, arising out of, or\nin connection with this Contract or, after risk of loss passes to Purchaser, the\noperation or maintenance of the System, to the extent such losses were caused by\nthe negligence or willful misconduct of the Purchaser, its subcontractors,\nemployees or agents (other than Contractor). The defense, indemnification and\nsave harmless obligation is specifically conditioned on the following (i)\nContractor providing prompt notification in writing of any such claim or demand\nwhen it obtains Actual Knowledge thereof, unless such failure shall not have\nmaterially impaired Purchaser's ability to defend against such claim; (ii)\nPurchaser having control of the defense of any such action, claim or demand and\nof all negotiations for its settlement or compromise; and (iii) Contractor\ncooperating, at Purchaser's expense, in a reasonable way to facilitate the\ndefense of such claim or demand or the negotiations for its settlement.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              50\n\nARTICLE 24  COUNTERPARTS\n------------------------\n\n          This Contract may be signed in any number of counterparts, each of\nwhich shall be an original, with the same effect as if the signatures thereto\nand hereto were upon the same instrument.\n\nARTICLE 25  DESIGN AND PERFORMANCE RESPONSIBILITY\n-------------------------------------------------\n\n     A.   The Contractor shall be solely responsible for the design of and for\nall details of the System and the System Upgrades and for the adequacy thereof.\n\n     B.   The Contractor's responsibility for design of the System and the\nSystem Upgrades shall not in any way be diminished nor shall the Contractor's\ndesign approach be restricted or limited by the Purchaser's acceptance of the\nContractor's guidance or recommendations as to engineering standards and design\nspecifications, or by the Purchaser's suggestions or recommendations on any\naspect of the design.\n\n     C.   Purchaser shall use reasonable efforts in assisting the Contractor to\nobtain in a timely manner accurate information required for the Contractor to\nperform the Work and the Upgrade Work, which Contractor cannot expeditiously and\ncost-effectively obtain from any source other than the Purchaser.\n\nARTICLE 26  PRODUCT CHANGES\n---------------------------\n\n          The Contractor may at any time make changes to the System or System\nUpgrades furnished pursuant to this Contract, or modify the drawings and\npublished specifications relating thereto, or substitute equipment of later\ndesign, provided the changes, modifications, or substitutions under normal and\nproper use do not impact upon the form, fit, expected life or function of the\nSystem as provided in the System Performance Requirements.\n\nARTICLE 27  RISK AND INSURANCE\n------------------------------\n\n     A.   The Contractor shall at all times maintain, after the date which is 30\ndays from the date hereof, and upon request, the Contractor shall furnish the\nPurchaser with certificates, or other reasonable evidence, that Contractor\nmaintains, the following insurance or has adequate self-insurance (other than as\nrequired to comply with any statutory insurance requirements); provided, that\n                                                               --------      \nthe following insurance coverages may be combined or in different form so long\nas Contractor maintains insurance consistent with the following requirements:\n\n          1.   Workmen's Compensation and Employers Liability Insurance (with a\n               limit of not less than * for any one incident or series of\n               incidents arising from one event or such higher limit as may be\n               required by the laws of any jurisdiction) covering the officers\n               and employees of the Contractor for all compensation or other\n               benefits required of the Contractor by the laws of any nation or\n               political sub-division thereof to\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              51\n\n               which the Contractor and its operations under this Contract are\n               subject in respect of injury of death of any such employee.\n\n          2.   Comprehensive General Public Liability Insurance, covering\n               personal injury and\/or property damage, with combined single\n               limits of not less than * for claims of injury or death of any\n               persons or loss of or damage to property resulting from any one\n               accident. This insurance to be extended to provide Marine\n               Comprehensive General Liability including liabilities arising out\n               of the operation of subsea equipment.\n\n          3.   Comprehensive Automobile Liability insurance covering all\n               vehicles and automotive equipment owned, hired, or in the custody\n               and control of Contractor and complying with all applicable\n               legislation with limits not less than * combined single limit for\n               the death or injury of any person per accident and not less than\n               * for the loss or damage to property resulting from any one\n               accident.\n\n          4.   All Risk Insurance in respect of all property of Contractor, its\n               respective officers, agents and employees connected with the\n               performance of the Work against all loss or damage from whatever\n               cause.\n\n          5.   Conventional Marine Hull and Machinery Insurance including War\n               Risks or any vessel(s) owned, operated or chartered by the\n               Contractor, in an amount equal to the full value thereof. In the\n               event of damage to or loss of such vessel(s), the Contractor\n               agrees to look to its insurance carrier for payment of such loss\n               or damage and hereby releases the Purchaser and waives any claims\n               against the Purchaser for the loss of such vessel(s) unless due\n               to the negligence of Purchaser, its agent or representatives\n               (other than Contractor).\n\n          6.   All vessels are to be entered in a Mutual Protection and\n               Indemnity Association with a full and unlimited entry or to have\n               Marine Protection and Indemnity Insurance with a limit of not\n               less than * including coverage far illness, injury or death of\n               crew members (unless covered under Workmen's Compensation\n               Insurance), Contractual Liability Coverage, Collision and Tower's\n               Liability, Removal of Wreck and Debris and Third Party Liability.\n\n          7.   Excess Liability Coverage over that required in Sub-Articles\n               27(A)(1), (2) and (3) with minimum limits of * for any one\n               accident or occurrence.\n\n          8.   Specialist Operations Insurance with a limit of not less than\n               * as per London Wording 1993 or equivalent.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              52\n\n          9.   Transit Insurance including inland, air, and Marine Cargo\n               coverage including War (other than on land) in an amount\n               sufficient to cover the expected highest value of any one\n               shipment. Coverage to include Institute Cargo Clauses, all risks\n               1.1.63, Institute War Clauses, London Malicious Damage Clause,\n               and Institute Strikes Riots and Civil Commotion Clauses or their\n               equivalent.\n\n          10.  Marine Cargo or equivalent is required to protect, for full cost,\n               against all risks of physical loss or damage to the plant,\n               equipment and supplies to be included in the System  (other than\n               War Risks) beginning with when each such item is ready for\n               shipping and ending when the submersible plant and equipment are\n               placed overside the cable laying vessel and when the equipment\n               and supplies are delivered to the cable stations, central\n               offices, or network operation center.  The coverage continues to\n               cover cable lying on the seabed.\n\n          11.  Sea Bed or equivalent coverage (including an Old Mines and\n               Torpedoes Clause, including other derelict weapons of War) is\n               required to protect, for full cost, against all risks of physical\n               loss or damage to the submersible plant and equipment described\n               in Sub-Article 27(A)(10) above. See last paragraph.\n\n          12.  War Risks or equivalent coverage is required to protect against\n               damage to, seizure by and\/or destruction of the System by means\n               of war, piracy, takings at sea and other warlike operations until\n               discharge of the submersible plant and equipment. For the\n               purposes of this Article \"discharge of the submersible plant and\n               equipment\" shall be deemed to take place when the plant and\n               equipment reaches the sea bottom, as far as the submersible plant\n               and equipment is concerned, and when the plant is off-loaded in\n               the respective terminal country, as far as non-submersible plant\n               is concerned.\n\n          13.  Pollution Liability (EIL) insurance for installation operations\n               and as arising from the use of vessels in an amount not less than\n               * or such higher sum as may be required to meet any legal\n               requirement in area of operations.\n\n          The Comprehensive General Liability Insurance required pursuant to \nSub-Article 27(A)(2) above, shall include Contractual Liability Coverage which\nshall specifically apply to the obligations assumed by the Contractor under the\nTerms and Conditions of this Contract.\n\n     B.   1.   All the foregoing insurances shall be effected with a\n               creditworthy insurer and shall be endorsed to provide Purchaser\n               with at least thirty (30) days prior written notice of\n               cancellation or material change.\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              53\n\n          2.   All the foregoing insurances shall name Purchaser as an\n               additional insured as to operations hereunder, in which event the\n               Contractor's insurance shall be primary to any insurance carried\n               by Purchaser.\n\n          3.   The limits specified herein are minimum requirements and shall\n               not be construed in any way as limits of liability or as\n               constituting acceptance by Purchaser of such responsibility for\n               financial liabilities in excess of such limits. The Contractor\n               shall bear all deductibles applicable to any insurance.\n\n          4.   If it is judicially determined that the monetary limits of\n               insurance required hereunder or of any indemnity voluntarily\n               assumed under the Terms and Conditions of this Contact which the\n               Contractor agrees will be supported either by available liability\n               insurance or voluntarily self-insured, in part or whole, exceeds\n               the maximum limits permitted under applicable law, it is agreed\n               that said insurance requirements or indemnity shall automatically\n               be amended to conform to the maximum monetary limits permitted\n               under such law.\n\n          5.   Contractor shall take reasonable steps to provide that any sub-\n               contractor engaged by it has in effect or will effect Employer's\n               Liability, Workmen's Compensation, Hull and Machinery and\n               Protection and Indemnity insurances and any other insurances\n               required by law, together with such other insurances as the\n               Contractor may consider necessary.\n\n          6.   If the Contractor fails to effect or keep in force any of the\n               insurances required under this Contract, Purchaser may effect and\n               keep in force any such insurances and pay such premiums as may be\n               necessary for that purpose and from time to time deduct the\n               amount so paid by Purchaser from any money due or which may\n               become due to the Contractor hereunder or recover the same as a\n               debt due from the Contractor, provided that Purchaser is not in\n               Default.\n\n          7.   Each Party shall give the other prompt notification of any claim\n               with respect to any of the insurances to be provided hereunder,\n               accompanied by full details giving rise to such claim. Each Party\n               shall afford the other all such assistance as may be required for\n               the preparation and negotiation of insurance claims.\n\n          8.   Contractor shall report to Purchaser as soon as practicable all\n               accidents or occurrences resulting in injuries to Contractor's\n               employees or third parties, or damage to property of third\n               parties, arising out of our during the course of services for\n               Purchaser by Contractor.\n\n     C.   The Contractor may organize such levels of deductibles, excesses and\nself-insurance as it considers appropriate and which are within prudent industry\nstandards.\n\n \n                                                                              54\n\n     D.   The insurance requirements of this Article 27 will remain in place\nwith respect to each Segment, the System or System Upgrade, as the case may be,\nand will not in any way be diminished or reduced until the transfer of title and\nrisk of loss shall have passed to Purchaser of such Segment, System or System\nUpgrade, as the case may be, even in the event of the sale of substantially all\nthe assets of the Contractor by way of a merger, consolidation or sale of\nassets.\n\nARTICLE 28 PLANT AND WORK RULES\n-------------------------------\n\n          Employees and agents of each Party shall, while on the premises of the\nother or its subcontractors, comply with all plant rules and governmental\nregulations.\n\nARTICLE 29 RIGHT OF ACCESS\n--------------------------\n\n     A.   The Contractor shall, upon reasonable notice of not less than ten (10)\nworking days, during normal business hours and in a manner to avoid any\ndisruption of the work on the premises including performance of other contracts,\npermit access by the Purchaser or its Quality Assurance (QA) Representative\n(other than a competitor of the Contractor or any affiliate of a competitor) to\nthe Contractor's premises where the work will be performed, and will use its\nbest endeavors to secure rights of access to premises of its subcontractors\nwhere the work will be performed, having subcontracts or orders in the amount\nof, or equivalent to * or more, in accordance with the Contractor's contractual\narrangements with its subcontractors, and allow the Purchaser or its QA\nRepresentative to:\n\n          1.   audit the Contractor's quality assurance system and its\n               application to the Work and Upgrade Work, including manufacture,\n               development and raw materials and components provision;\n\n          2.   inspect all parts of the Work and Upgrade Work to the extent\n               reasonably practicable to ensure that their quality meets the\n               Technical Specification.\n\nThis right of access shall allow for the Purchaser and\/or its QA representative\n(up to a total of three (3) persons). The Purchaser shall provide the name(s),\nnationality and title of each such visitor prior to the visit.  The Contractor\nshall not be responsible for any costs, including travel and accommodation\ncosts, of the Purchaser or its representatives.\n\n     B.   The right of access shall also allow for the Purchaser and\/or\nrepresentatives (up to a total of three (3) persons) to be aboard the vessel(s)\nduring installation and the route survey, provided accommodations are available.\nThe Contractor shall not be responsible for any costs of the Purchaser or its\nrepresentatives, except for living expenses on board the vessel which includes\none (1) daily telex or fax, all other travel and accommodation costs for the\nPurchaser or its QA Representatives shall be for the account of the Purchaser.\n\n     C.   Any right of access shall not be construed as creating any obligation\nrequiring the Contractor or its subcontractors to disclose trade secrets or\nproprietary information.\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              55\n\nFurther, such right of access may be conditioned on the execution of a\nconfidentiality and non-disclosure agreement and\/or subject to routine building\nor security rules, regulations or procedures.\n\n     D.   Any exercise of any right of the Purchaser hereunder to inspect,\naudit, visit or to serve any part of the Work or System Upgrades shall not be\nconstrued as limiting any obligation of Contractor hereunder, including without\nlimitation, under Articles 1 and 10 hereof.\n\n     E.   Contractor will have access to the System as necessary to accomplish\nits responsibilities under this Contract and in order to make repairs and to\nmake System Upgrades. Contractor will provide reasonable notice of its need for\naccess and will take reasonable steps to minimize disruptions to the operation\nof the System.\n\n     F.   Contractor shall give the Purchaser reasonable prior written notice of\neach monthly project management review meeting with respect to the status of the\nconstruction and\/or installation of the System, and Purchaser's representatives\n(up to three such representatives) and the Independent Engineer shall at their\ncost be permitted to attend and participate in such meetings.\n\nARTICLE 30 QUALITY ASSURANCE\n----------------------------\n\n          All equipment, material and supplies provided under this Contract\nshall be inspected and tested by representatives designated by the Contractor to\nthe extent reasonably practical to assure that the quality of the equipment,\nmaterials and supplies being incorporated is sufficient to realize the System\nPerformance Requirements. The inspection and test program established for such\nequipment, materials and supplies shall be consistent with commercial practices\nnormally employed by the Contractor in the construction of submarine cable\nsystems. The foregoing shall not be construed as limiting any of the\nContractor's obligations under this Contract.\n\nARTICLE 31 DOCUMENTATION\n------------------------\n\n          The Contractor shall furnish to the Purchaser one copy of the standard\ndocumentation in the English language for the System provided hereunder. Such\ndocumentation shall be provided prior to the Acceptance testing. Additional\ncopies of the documentation are available at additional cost.\n\nARTICLE 32 TRAINING\n-------------------\n\n          The Contractor will provide, as part of the Initial Contract Price,\nuntil the Date of Final Acceptance, any and all training, as more particularly\ndescribed in the training section of Appendix 6, necessary for the operation and\nmaintenance of the System.\n\n \n                                                                              56\n\nARTICLE 33 SETTLEMENT OF DISPUTES\/ARBITRATION\/LITIGATION\n--------------------------------------------------------\n\n     A.   The Parties shall endeavor to settle amicably by mutual discussions\nany disputes, differences, or claims whatsoever related to this Contract.\n\n     B.   Failing such amicable settlement, any controversy, claim or dispute\narising under or relating to this Contract, including the existence, validity,\ninterpretation, performance, termination or breach thereof, shall, if both\nParties agree in writing thereto, finally be settled by arbitration in\naccordance with the International Arbitration Rules of the American Arbitration\nAssociation (\"AAA\"). Unless the Parties agree to a sole arbitrator, there shall\nbe three (3) arbitrators, with each Party appointing one arbitrator, who\ncollectively will select a third. The language of the arbitration shall be\nEnglish. The Arbitrator will not have authority to award punitive damages to\neither Party. Each Party shall bear its own expenses, but the Parties shall\nshare equally the fees and expenses of the Arbitration Tribunal and the AAA.\nThis Contract shall be enforceable, and any arbitration award shall be final,\nand judgment thereon may be entered in any court of competent jurisdiction. In\nany such arbitration, the decision in any prior arbitration under this Contract\nshall not be deemed conclusive of the rights as among themselves of the Parties\nhereunder. The arbitration shall be held in New York, New York, U.S.A.\n\n     C.   1.   If both Parties do not agree to arbitration pursuant to paragraph\n               (B) above, then either Party may institute suit in the Supreme\n               Court of the State of New York sitting in New York County or the\n               United States District Court of the Southern District of New\n               York, or any appellate court from any thereof.\n\n          2.   Each Party hereby irrevocably and unconditionally submits to the\n               non-exclusive jurisdiction of any New York State or Federal court\n               sitting in The City of New York, and any appellate court from any\n               thereof, in any action or proceeding arising out of or relating\n               to this Contract, and each Party hereby irrevocably and\n               unconditionally agrees that all claims in respect of such action\n               or proceeding may be heard and determined in such New York State\n               court or, to the extent permitted by law, in such Federal court.\n               Each Party hereby irrevocably and unconditionally waives, to the\n               fullest extent it may effectively do so, any defense of an\n               inconvenient forum to the maintenance of such action or\n               proceeding in any such court and any right of jurisdiction on\n               account of the place of residence or domicile of either Party.\n               The Contractor hereby irrevocably and unconditionally appoints CT\n               Corporation System (the \"New York Process Agent\"), with an office\n                                        ----------------------                  \n               on the date hereof at 1633 Broadway, New York, New York, as its\n               agent to receive on behalf of the Contractor and its respective\n               property service of copies of the summons and complaint and any\n               other process which may be served in any such action or\n               proceeding in any such New York State or Federal court and agrees\n               promptly to appoint a successor New York Process Agent in The\n               City of New York (which successor Process Agent shall accept such\n\n \n                                                                              57\n\n               appointment in a writing prior to the termination for any reason\n               of the appointment of the initial New York Process Agent). In any\n               such action or proceeding in such New York State or Federal court\n               sitting in The City of New York, such service may be made on the\n               Contractor by delivering a copy of such process to the Contractor\n               in care of the appropriate Process Agent at such Process Agent's\n               above address and by depositing a copy of such process in the\n               mails by certified or registered air mail, addressed to the\n               Contractor at its address referred to in Article 35 of this\n               Contract (such service to be effective upon such receipt by the\n               appropriate Process Agent and the depositing of such process in\n               the mails as aforesaid). The Contractor hereby irrevocably and\n               unconditionally authorizes and directs such Process Agent to\n               accept such service on its behalf. As an alternate method of\n               service, the Contractor also irrevocably and unconditionally\n               consents to the service of any and all process in any such action\n               or proceeding in such New York State or Federal court sitting in\n               The City of New York by mailing of copies of such process to the\n               Contractor, as the case may be, by certified or registered air\n               mail at its address referred to in Article 35 of this Contract.\n               The Contractor agrees that, to the fullest extent permitted by\n               applicable law, a final judgment in any such action or proceeding\n               shall be conclusive and may be enforced in other jurisdictions by\n               suit on the judgment or in any other manner provided by law.\n\n          3.   WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE\n               --------------------                                          \n               FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE\n               TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY\n               ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS\n               CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER\n               THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE,\n               AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY\n               OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF\n               LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)\n               ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN\n               INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE\n               MUTUAL WAIVERS AND CERTIFICATIONS IN THIS PARAGRAPH.\n\n     D.   THE OBLIGATIONS OF EACH PARTY IN RESPECT OF THIS CONTRACT DUE TO ANY\nPARTY SHALL, NOTWITHSTANDING ANY JUDGMENT IN A CURRENCY (THE \"JUDGMENT\n                                                              --------\nCURRENCY\") OTHER THAN DOLLARS, BE DISCHARGED ONLY TO THE EXTENT THAT ON THE\n--------\nBUSINESS DAY FOLLOWING RECEIPT BY SUCH PARTY OF ANY SUM ADJUDGED TO BE SO DUE IN\nTHE JUDGMENT CURRENCY SUCH PARTY MAY IN ACCORDANCE WITH NORMAL\n\n \n                                                                              58\n\nBANKING PROCEDURES PURCHASE DOLLARS WITH THE JUDGMENT CURRENCY; IF THE AMOUNT OF\nDOLLARS SO PURCHASED IS LESS THAN THE SUM ORIGINALLY DUE TO SUCH PARTY IN\nDOLLARS, EACH PARTY AGREES, AS A SEPARATE OBLIGATION AND NOTWITHSTANDING ANY\nSUCH JUDGMENT, TO INDEMNIFY SUCH PARTY AGAINST SUCH LOSS, AND IF THE AMOUNT OF\nDOLLARS SO PURCHASED EXCEEDS THE SUM ORIGINALLY DUE TO ANY PARTY TO THIS\nCONTRACT, EACH PARTY AGREES TO REMIT TO SUCH PARTY, SUCH EXCESS.\n\nARTICLE 34 APPLICABLE LAW\n-------------------------\n\n          THIS CONTRACT SHALL BE CONSTRUED AND GOVERNED IN ACCORDANCE WITH THE\nLAWS OF THE STATE OF NEW YORK, UNITED STATES, EXCLUDING ITS CONFLICTS OF LAW\nPROVISIONS AND EXCLUDING THE CONVENTION FOR THE INTERNATIONAL SALE OF GOODS.\n\nARTICLE 35 NOTICES\n------------------\n\n     A.   Any notices, consent, approval, or other communication pursuant to\nthis Contract shall be in writing, in the English language, and shall be deemed\nto be duly given or served on a Party if sent to the Party at the address\nstipulated in Sub-Article 35(B) and if sent by any one of the following means\nonly:\n\n          1.   Sent by hand: Such communication shall be deemed to have been\n               received on the day of delivery provided receipt of delivery is\n               obtained.\n\n          2.   Sent by facsimile: Such communication shall be deemed to have\n               been received, under normal service conditions, twenty-four (24)\n               hours following the time of dispatch or on confirmation by the\n               receiving Party, whichever is earlier.\n\n          3.   Sent by registered or certified mail: Such communication shall be\n               deemed to have been received, under normal service conditions, on\n               the day it was received or on the tenth day after it was\n               dispatched, whichever is earlier.\n\n     B.   For purposes of this Article, the names, addresses and fax numbers of\nthe Parties are as detailed below. Any change to the name, address, and\nfacsimile numbers may be made at any time by giving thirty (30) days prior\nwritten notice.\n\nTyco Submarine Systems Ltd.\n340 Mt. Kemble Avenue\nMorristown, New Jersey 07960\nTel: 973-326-3500\nFax: 973-326-2711\n\n \n                                                                              59\n\nGCT Pacific Holdings Ltd.\nWessex House\n45 Reid Street\nHamilton HM12\nBermuda\nFax:  441-296-6749\/8606\nAttn: Cameron Adderly\n\n     C.  All provisions in this Contract regarding notices, consents, approvals\nand other communications to and from, and other actions taken on behalf of, the\nContractor are subject to the provisions of Article 42 hereof.\n\nARTICLE 36 PUBLICITY AND CONFIDENTIALITY\n----------------------------------------\n\n     A.  No information relating to this Contract shall be released by either\nParty to any newspaper, magazine, journal or other written, oral or visual\nmedium without the prior written approval of an authorized representative of the\nother Party; provided that, subject to Article 20 (Safeguarding of Information\n             --------                                                         \nand Technology) and the following Sub-Article, this Article shall not restrict\neither Party from (i) responding to customary press inquiries or otherwise\nmaking public or private statements in the normal course of business, so long as\nconsistent with a mutually agreed press-release and (ii) assisting in the\nobtaining of financing in accordance with Sub-Article 37(C), including the\npublication of a financial tombstone.\n\n     B.  This Contract and any non-public information, written or oral, with\nrespect to this Contract, \"Confidential Information\", will be kept confidential\nand shall not be disclosed, in whole or in part, to any person other than\naffiliates, officers, directors, employees, agents or representatives of a Party\n(collectively, \"Representatives\") who need to know such Confidential Information\nfor the purpose of negotiating and executing this Contract. Each Party agrees to\ninform each of its Representatives of the non-public nature of the Confidential\nInformation and to direct such persons to treat such Confidential Information in\naccordance with the terms of this Article. Nothing herein shall prevent a Party\nfrom disclosing Confidential Information (a) upon the order of any court or\nadministrative agency, (b) upon the request or demand of, or pursuant to any\nregulation of, any regulatory agency or authority, (c) to the extent reasonably\nrequired in connection with the exercise of any remedy hereunder, (d) to a\nParty's legal counsel or independent auditors, (e) prospective lenders to the\nPurchaser or Holding Company, and (f) to any actual or proposed assignee of all\nor part of its rights hereunder provided that such actual or proposed assignee\nagrees in writing to be bound by the provisions of this Article.\n\nARTICLE 37 ASSIGNMENT; SUBCONTRACTORS\n-------------------------------------\n\n     A.  Except as provided in this Article, neither Party shall assign this\nContract or any right or interest under this Contract, nor delegate any work or\nobligation to be performed under this Contract (\"Assignment\"), without the other\nParty's prior written consent which shall not be unreasonably withheld (it being\nunderstood that it shall be deemed to be reasonable to withhold consent to the\nassignment of this Contract or any rights, interest or\n\n \n                                                                              60\n\nobligations hereunder to a competitor of Contractor or an affiliate of a\ncompetitor or uncreditworthy party). Nothing herein shall preclude a Party from\nemploying a subcontractor in carrying out its obligations under this Contract. A\nParty's use of such subcontractor shall not release the Party from its\nobligations or liability (including warranties) under this Contract. If a\nproposed subcontractor of major equipment (i.e., equipment listed on Exhibit E)\nis not listed on Exhibit E hereto, Contractor shall obtain approval thereof from\nPurchaser, which approval shall not be unreasonably withheld.  Purchaser and\nContractor shall agree on the form and substance of Exhibit E by May 1, 1998.\n\n     B.  The Contractor has the right to assign all of its rights under this\nContract or to delegate all of its duties hereunder at any time without the\nPurchaser's consent to any successor to substantially all the assets of the\nContractor by way of a merger, consolidation or sale of assets provided that in\nthe case of any assignment or delegation pursuant to this Sub-Article 37(B) such\nassignee shall assume in writing all warranties, representations and obligations\nof Contractor under this Contract. The Contractor shall give the Purchaser\nwritten notice 30 days prior to the assignment.\n\n     C.  The Parties acknowledge that Purchaser may finance construction of the\nSystem on a \"project finance\" basis and that in connection therewith the\nfinancing parties will require that such financing be secured by certain assets\nof Purchaser (including but not limited to this Contract). The Purchaser may, in\nconnection with any such project financing grant a collateral assignment of the\nSystem and\/or its rights and obligations under this Contract to any such\nfinancing parties, and in connection therewith, the Contractor will execute and\ndeliver a Consent, substantially in the form of Exhibit B hereto; provided that\nContractor agrees to make such changes or additions to such form as may be\nreasonably requested by such financing parties, and Purchaser, and such\nfinancing parties, may transfer in accordance with such Consent. Contractor will\nalso deliver an Opinion in the form of Exhibit C hereto, * with respect to the\nGuaranty, to Purchaser and such financing parties and such other documents as\nare reasonably requested by such financing parties.\n\n     D.  The Purchaser has the right to assign all of its rights and delegate\nall of its duties under this Contract to any other entity to whom all of\nPurchaser's rights and interests in the System have been transferred.  Purchaser\nalso has the right (i) to assign all of its rights hereunder with respect to any\nparticular Landing Assets to any Transferee, (ii) to assign Permits with respect\nto such Landing Assets, or have Permits with respect to such Landing Assets\nissued in the name of, such Transferee and (iii) to transfer such Landing Assets\nor have such Landing Assets transferred directly to, such Transferee; provided\n                                                                      --------\nthat such Transferee shall execute a supplement to this Contract whereby it\nbecomes jointly and severally liable, together with Purchaser, for all of\nPurchaser's obligations under this Contract. \"Landing Assets\" means, with\nrespect to each jurisdiction where a portion of the System is located, all or\npart of such portion of the System located therein. It is understood that the\nPurchaser, at its option, may assign and transfer rights with respect to Landing\nAssets in different jurisdictions to different Transferees. Purchaser shall not\ntransfer any of its rights under this Contract or the System except in\naccordance with the foregoing. Any assignment or transfer not expressly\npermitted by Sub-Articles 37(D) or 37(E) shall be of no force and\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              61\n\neffect. Any assignment or transfer which results in any increase in costs or any\nloss, damage, delay or failure of performance shall constitute a Force Majeure,\nand, without limiting the applicability of Article 17 (Force Majeure), Purchaser\nshall be responsible for any increase in costs resulting therefrom.\n\n     E.   GCT may assign all its right, title and interest hereunder, including\nall rights, obligations and liabilities, to a subsidiary formed by GCT and\ncertain other shareholders.\n\nARTICLE 38 RELATIONSHIP OF THE PARTIES\n--------------------------------------\n\n          All work performed by a Party under this Contract shall be performed\nas an independent contractor and not as an agent of the other and no persons\nfurnished by a Party shall be considered the employees or agents of the other.\nEach Party shall be responsible for its employees' compliance with all Laws\nwhile performing under this Contract. This Contract shall not form a joint\nventure or partnership between the Parties.\n\nARTICLE 39 SUCCESSORS BOUND\n---------------------------\n\n          This Contract shall be binding on the Contractor and the Purchaser and\ntheir respective successors and permitted assigns.\n\nARTICLE 40 ARTICLE CAPTIONS\n---------------------------\n\n          The captions of the Articles do not form part of this Contract and\nshall not have any effect on the interpretation thereof.\n\nARTICLE 41 SEVERABILITY\n-----------------------\n\n          If any of the provisions of this Contract shall be invalid or\nunenforceable, such invalidity or unenforceability shall not invalidate or\nrender unenforceable the entire Contract, but rather the entire Contract shall\nbe construed as if not containing the particular invalid or unenforceable\nprovision or provisions and the rights and obligations of the Contractor and the\nPurchaser shall be construed and enforced accordingly. In the event such invalid\nor unenforceable provision is an essential and material element of this\nContract, the Parties shall promptly negotiate a replacement provision.\n\nARTICLE 42 *\n------------\n\n     *\n\nARTICLE 43 SURVIVAL OF OBLIGATIONS\n----------------------------------\n\n          The Parties' rights and obligations, which, by their nature would\ncontinue beyond the termination, cancellation or expiration of this Contract,\nincluding, but not limited to, those contained in Sub-Article 4(B) (Taxes,\nLevies and Duties) and Sub-Article 4(C)\n\n\n* MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR CONFIDENTIAL \n  TREATMENT.\n\n \n                                                                              62\n\n(Withholding Tax), Article 18 (Intellectual Property), Article 20 (Safeguarding\nof Information and Technology), Article 21 (Export Control) and Article 23\n(Limitation of Liability\/Indemnification) shall survive termination,\ncancellation or expiration hereof. Article 10 (Warranty) and Article 11\n(Contractor Support), shall survive termination, cancellation or expiration\nhereof, if and only if, this Contract is terminated by Purchaser pursuant to\nSub-Article 13(A).\n\nARTICLE 44  NON-WAIVER\n----------------------\n\n               A waiver of any of the terms and conditions of this Contract, or\nthe failure of either Party strictly to enforce any such term or condition, on\none or more occasions shall not be construed as a waiver of the same or of any\nother term or condition of this Contract on any other occasion.\n\nARTICLE 45 LANGUAGE\n-------------------\n\n               This Contract has been executed in the English language and\nEnglish will be the controlling language for interpretation of this Contract.\n\nARTICLE 46  ENTIRE AGREEMENT\n----------------------------\n\n               This Contract supersedes all prior oral or written understanding\nbetween the Parties and constitutes the entire agreement with respect to the\nsubject matter herein. Any modification, amendment, waiver, approval or consent\ngiven hereunder must be evidenced by a writing signed by authorized\nrepresentatives of all Parties.\n\nARTICLE 47  COMING INTO FORCE\n-----------------------------\n\n     A.        This Contract between the Purchaser and Contractor will not enter\ninto force or effect (except that Article 36 is in full force and effect as of\nthe date hereof) unless and until:\n\n     (I)   The Guaranty is executed and delivered on or before April 30, 1998,\n     substantially in the form of Exhibit A hereto;\n\n     (II)  Purchaser shall have made a draw request to its lenders for the first\n     portion of the initial payment described in Sub-Article 5(C)(2);\n\n     (III) GCT and certain other shareholders shall have formed a Bermuda\n     subsidiary to be the Purchaser;\n\n     (IV)  GCT shall have transferred its rights and obligations hereunder to\n     such Bermuda subsidiary;\n\n     (V)   GCT and such shareholders shall have executed and delivered equity\n     contribution agreements satisfactory to such Bermuda subsidiary's lenders;\n\n \n                                                                              63\n\n     (VI)  Such Bermuda subsidiary shall have executed an original counterpart\n     of this Contract; and\n\n     (VII) The Purchaser, in its sole discretion, has decided to allow this\n     Contract to come into force and effect.  For the avoidance of doubt, it is\n     understood that pursuant to this clause (VII), the Purchaser may\n     unilaterally decide to effectively cancel this Contract by not permitting\n     it to come into force by May 5, 1998.\n\n     B.    When all the conditions indicated in Sub-Article 47(A) above are\ncomplied with, then the Purchaser shall immediately notify the Contractor, and,\nso long as the date of such notice is on or before May 5, 1998, the Contract\nshall come into force on the date of such notice.\n\n \n                                                                              64\n\n          This Contract is executed by duly authorized representatives of the\nParties as set forth below.\n\n                                                  TYCO SUBMARINE SYSTEMS LTD. \n                                                                          \n                                                  By:\/s\/ Ronald Armstrong \n                                                     --------------------\n                                                  Name:  Ronald Armstrong \n                                                  Title: Vice President\n                                                  Date:  April 21, 1998\n                                                                               \n                                                                               \n                                                  GCT PACIFIC HOLDINGS, LTD.   \n                                                                               \n                                                  By:\/s\/ R. Evgene Shutter\n                                                     ---------------------\n                                                  Name: R. Evgene Shutter\n                                                  Title: President\n                                                  Date:  April 21, 1998\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7648,9133],"corporate_contracts_industries":[9452,9519],"corporate_contracts_types":[9613,9620],"class_list":["post-42700","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-global-crossing-ltd","corporate_contracts_companies-tyco-international-ltd","corporate_contracts_industries-manufacturing__conglomerates","corporate_contracts_industries-telecommunications__telephone","corporate_contracts_types-operations","corporate_contracts_types-operations__services"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42700","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42700"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42700"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42700"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42700"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}