EIGHTH AMENDMENT TO CONTRACT FOR ALASKA ACCESS SERVICES
This EIGHTH AMENDMENT TO THE CONTRACT FOR ALASKA ACCESS SERVICES
("Eighth Amendment") is effective as of the 24th day of July 2003, by and
between GENERAL COMMUNICATION, INC. and its wholly owned subsidiary, GCI
COMMUNICATION CORP., both Alaska corporations (together, "GCI") with offices
located at 2550 Denali Street, Suite 1000, Anchorage, Alaska 99503-2781 and MCI
WORLDCOM NETWORK SERVICES, INC. ("MWNS"), formerly known as MCI
Telecommunications Corporation, with offices located at 1133 19th Street, N.W.,
Washington, D.C. 20036 (GCI with MWNS, collectively, the "Parties," and
individually, a "Party").
RECITALS
WHEREAS, GCI and MWNS entered into that certain Contract for Alaska
Access Services dated January 1, 1993 ("Original Agreement"), as amended by (i)
the First Amendment to Contract for Alaska Access Services dated March 1, 1996,
(ii) the Second Amendment to the Contract for Alaska Access Services dated
January 1, 1998, (iii) the Third Amendment to Contract for Alaska Access
Services dated March 1, 1998, (iv) the Fourth Amendment to Contract for Alaska
Access Services dated as of January 1, 1999, (v) the Fifth Amendment to Contract
for Alaska Access Services dated as of August 7, 2000, (vi) the Sixth Amendment
to Contract for Alaska Access Services dated as of February 14, 2001, and (vii)
the Seventh Amendment to Contract for Alaska Access Services dated March 8, 2001
(collectively, "Agreement") which set forth the general terms and conditions
under which GCI provides certain telecommunications services to MWNS; and ,
WHEREAS, effective September 20, 1999, WorldCom Network Services, Inc.
merged into MWNS pursuant to that certain Certificate of Merger dated as of
September 15, 1999; and,
WHEREAS, on July 21, 2002, MWNS and certain of its domestic affiliates
filed voluntary petitions for relief under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the Southern District
of New York (the "Bankruptcy Court"). MWNS is continuing to operate its business
and manage its properties as a debtor-in-possession pursuant to 11 U.S.C. ss.ss.
363, 1107(a) and1108.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as
follows:
CONFIDENTIAL 1
1. Definitions.
Effective Date: The first day of the month in which the Settlement And
Release Agreement between WorldCom, Inc. and GCI is approved pursuant to
the procedures set forth by the Bankruptcy Court.
2. Rates and Charges
A. Paragraph 2.B.(1) of the Agreement shall be deleted and the following
inserted in its place:
2. B(1) MWNS Northbound Traffic. MWNS Northbound Traffic shall be charged
at the following rates per minute in the appropriate periods:
Date Rate in Dollars
---- ---------------
Effective Date ********
******** ********
******** ********
******** and thereafter ********
As an additional ********, upon execution of the Eighth Amendment GCI
shall provide MWNS ******** of all total MWNS Northbound traffic in excess
of the total MWNS Northbound traffic generated during the same month of
the prior calendar year at ******** (the "******** Northbound ********").
However, the maximum amount of MWNS Northbound minutes eligible for
******** shall be limited to a maximum of ******** % of the MWNS
Northbound minutes generated during the same month of the prior calendar.
GCI shall be obligated to provide this ******** Northbound ******** for so
long as MWNS has ******** remaining on the initial five year term of the
Contract for Alaska Access Services. To administer this ********
Northbound ******** structure, GCI shall provide to MWNS with its monthly
billing a statement of the monthly Northbound minutes billed for the
corresponding month in the previous year and GCI shall provide with
monthly billing following each
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COMPANY DESIRES TO KEEP UNDISCLOSED AND A COPY OF THE UNDREDACTED DOCUMENT
WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
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anniversary of this Amendment 8, i.e. July usage billing, a summary of
Northbound minutes billed for each of the current year's and the prior
year's corresponding monthly billing (i.e. each July). Notwithstanding any
provision of this Agreement to the contrary, MWNS shall have the right to
dispute the application of the ******** Northbound ******** for a period
of ******** from the due date of the invoice to which MWNS asserts the
******** Northbound ******** applies. There shall be no ********. GCI
shall pay the ******** and all ******** charges for the ******** of MWNS
Northbound Traffic.
B. Paragraph 2.B. (2) of the Agreement shall be deleted and the following
inserted in its place:
MWNS Southbound Traffic. MWNS Southbound Traffic (except for MWNS
********) shall be charged at the following rates per minute in the
appropriate periods:
Date Rate in Dollars
---- ---------------
Effective Date ********
******** ********
******** ********
******** ********
******** ********
******** ********
******** ********
******** ********
As an additional ********, upon execution of the Eighth Amendment GCI
shall provide MWNS origination of all total MWNS Southbound traffic
(except for MWNS ********) in excess of the total MWNS Southbound traffic
generated during the same month of the prior calendar year at ********
(the "******** Southbound ********"). However, the maximum amount of MWNS
Southbound minutes eligible for ******** origination during any given
month shall be limited to a maximum of ********% of the MWNS Southbound
minutes generated during the same
[CERTAIN INFORMATION HAS BEEN REDACTED FROM THIS DOCUMENT WHICH THE
COMPANY DESIRES TO KEEP UNDISCLOSED AND A COPY OF THE UNDREDACTED DOCUMENT
WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
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month of the prior calendar. GCI shall be obligated to provide this
******** Southbound ******** for so long as MWNS has ******** remaining on
the Contract for Alaska Access Services. . To administer this ********
Southbound ******** structure, GCI shall provide to MWNS with its monthly
billing a statement of the monthly Northbound minutes billed for the
corresponding month in the previous year and GCI shall provide with
monthly billing following each anniversary of this Amendment 8, i.e. July
usage billing, a summary of Northbound minutes billed for each of the
current year's and the prior year's corresponding monthly billing (i.e.
each July). Notwithstanding any provision of this Agreement to the
contrary, MWNS shall have the right to dispute the application of the
******** Southbound ******** for a period of ******** from the due date of
the invoice to which MWNS asserts the ******** Northbound ********
applies.
There shall be no ********. GCI shall pay the ******** and all ********
charges for MWNS Southbound Traffic. Any query charges associated with the
routing of MWNS Southbound Traffic, due to FCC Docket #86-10, will be
passed on to MWNS.
In accordance with FCC rules regarding per-call compensation for coinless
payphone calls (Second Order on Reconsideration in FCC Docket #96-128), as
first-switch interexchange carrier, GCI may be obligated to pay per-call
compensation for payphone-originated, coinless calls. Where it is so
obligated by law, GCI may assess a $0.26 surcharge, or the applicable
per-call compensation for payphone-originated calls as set by the FCC, on
MWNS Southbound Traffic for each compensable payphone call.
In no event will the payphone surcharge be higher than $******** above the
applicable per-call compensation for payphone-originated coinless calls,
as set by the FCC.
The surcharge shall not apply to calls for which MWNS certifies that it or
a reseller or customer of MWNS has direct or indirect arrangements for
payphone compensation with the payphone owner or its designated agent
("PSP") and for which MWNS provides GCI with adequate identification of
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COMPANY DESIRES TO KEEP UNDISCLOSED AND A COPY OF THE UNDREDACTED DOCUMENT
WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
CONFIDENTIAL 4
covered telephone numbers.
For calls routed to platform numbers, whether those of MWNS or a reseller
or customer of MWNS, answer supervision received by GCI may not accurately
indicate whether a dial-around payphone call is completed to the called
party and therefore compensable to the PSP. For such platform calls, at
MWNS's option, GCI shall assess surcharges only on calls MWNS identifies
to GCI as completed to the called party. MWNS, in a mutually agreed
computer readable format, shall provide GCI with adequate identification
of such platform telephone numbers and appropriate reporting to document
completion of those dial-around calls, for timely reporting by GCI to the
PSPs
If GCI or MWNS determines they have both paid payphone compensation for
the same calls, or that payphone compensation has been paid for
noncompensable calls, GCI and MWNS agree to cooperate to resolve the
discrepancy and process appropriate refund requests. GCI agrees to credit
MWNS for amounts surcharged in error.
GCI and MWNS shall cooperate with each other, and agree to make records
available (subject to reasonable confidentiality guarantees, where
appropriate) to verify proper and timely reporting, payment, and billing
for payphone originated dial-around calls and to help manage questions or
disputes raised by payphone owners or their agents. The Parties
acknowledge that FCC requirements and industry practices for per-call
compensation for coinless payphone calls may change during the term of the
Agreement. Either Party may reopen this provision of the Agreement, upon
thirty (30) days written notice, to renegotiate in light of changes in
applicable FCC rules or common industry practices thereunder.
C. Paragraph 2.F. shall be amended to provide as follows:
F. ********. Notwithstanding anything to the contrary, GCI shall adjust
the ******** for ******** provided under this Agreement so that GCI shall
******** MWNS (i) no more than it ******** any other customer for any
reasonably comparable mix of ********.
The ******** and ******** for the overall mix of ******** will be
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COMPANY DESIRES TO KEEP UNDISCLOSED AND A COPY OF THE UNDREDACTED DOCUMENT
WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
CONFIDENTIAL 5
evaluated every ******** beginning ******** from the effective date of the
Eighth Amendment. The ******** evaluation and review of ******** and
******** for the overall mix of ******** will be to determine whether the
******** for the total overall mix of ******** from GCI are the best
competitive alternative for ******** provided to MWNS in the Alaska market
and whether the total ******** being ******** by MWNS for the overall mix
of ******** from GCI is greater than that ******** by any other GCI
customer for a reasonably comparable mix of ********. If, following the
evaluation, MWNS determines that the total ******** are not the best
competitive alternative for providing the overall mix of ******** within
the Alaska market, MWNS may elect to terminate the Agreement after
******** with no liability for early termination. MWNS shall give GCI
written notice of such election and upon receipt of the notice by GCI, the
final year of the Agreement shall commence. However, prior to
discontinuation of ******** with GCI, MWNS shall give GCI written notice
of the total ******** a third party is offering for the reasonably
comparable mix of ********, and GCI shall have ******** to determine
whether to match the ******** and ******** mix of the third party. If GCI
fails to respond within ********, GCI shall be deemed to have waived the
right to match the offer of the third party.
3. Term. Paragraph 3 of the Agreement shall be deleted in its entirety and the
following inserted in its place:
3. TERM. Except for MWNS ********, services provided pursuant to Section 2.A
shall be for an initial term of five (5) years beginning the first day
following the effective date of the Eighth Amendment. The term shall be
automatically extended for ******** periods unless either Party elects to
cancel the renewal periods by giving written notice of non-renewal at least
******** prior to the commencement of the next renewal term. The service
for MWNS ******** shall be for a term of ******** upon the first access
service request ("ASR") authorizing the turn up of a serving area.
4. Effect of Amendment. All other terms and conditions of the Agreement not
expressly modified by this Eighth Amendment shall remain in full force and
effect. The Parties hereby affirm and agree such terms remain binding.
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COMPANY DESIRES TO KEEP UNDISCLOSED AND A COPY OF THE UNDREDACTED DOCUMENT
WILL BE FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
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5. Further Assurances. The Parties shall cooperate in good faith, and enter into
such other instruments and take such other actions, as may be necessary or
desirable, to fully implement the intent of this Eighth Amendment.
6. Counterparts; Signatures. This Eighth Amendment may be executed in
counterparts, each of which shall be deemed an original and both of which
together shall constitute one and the same instrument. When signed by each
Party's authorized representative, a copy or facsimile of this Eighth
Amendment shall have the same force and effect as one bearing an original
signature.
7. Defined Terms. Each capitalized term used but not defined herein shall have
the meaning ascribed to such term in the Agreement.
This Eighth Amendment together with the Agreement is the complete agreement of
the Parties and supersedes all other prior contracts and representations
concerning its subject matter. Any further amendments must be in writing and
signed by both Parties.
IN WITNESS WHEREOF, the Parties hereto each acting with proper authority have
executed this Amendment as of 24th day of July 2003.
MCI WORLDCOM NETWORK SERVICES, INC.
By: /s/
Printed Name: Peter H. Reynolds
Title: Director, National Carrier Initiatives
GCI COMMUNICATION CORP.
By: /s/
Printed Name: William C. Behnke
Title: Senior Vice President
CONFIDENTIAL 7