[***] - CONFIDENTIAL TREATMENT REQUESTED
Confidential Portions of This Agreement Which Have Been Redacted Are Marked
With Brackets ("[***]"). The Omitted Material Has Been Filed Separately With The
Securities and Exchange Commission.
NETWORK SERVICES AGREEMENT
BY AND BETWEEN
WEST VIRGINIA PCS ALLIANCE, L.C.
VIRGINIA PCS ALLIANCE, L.C.
AND
HORIZON PERSONAL COMMUNICATIONS, INC.
DATED AS OF AUGUST 12, 1999
NETWORK SERVICES AGREEMENT
This Network Services Agreement is dated as of August 12, 1999 ("Effective
Date") by and between West Virginia PCS Alliance, L.C., a Virginia limited
liability company (the "WV Alliance"), Virginia PCS Alliance, L.C., a Virginia
limited liability company (the "VA Alliance"), (collectively, the "Alliances");
and Horizon Personal Communications, Inc., an Ohio corporation ("Horizon").
RECITALS
A. The Alliances own broadband personal communications services ("PCS") licenses
and own and operate a PCS network (the "Alliances' Network") and provide PCS
services in several geographic markets, including the Markets (as defined
below).
B. Subject to the terms and conditions contained in this Agreement, Horizon
desires to purchase PCS Service (as defined below) from the Alliances and market
and sell the service to Horizon End Users (as defined below) as Horizon's
Private Label Service (as defined below), and the Alliances desire to sell PCS
Service to Horizon.
NOW, THEREFORE, and in consideration of the above premises and the mutual
promises set forth in this Agreement, the Alliances and Horizon agree as
follows:
1. DEFINITIONS
"Affiliate" means a person or entity that, directly or indirectly,
controls, is controlled by or is under common control with another person or
entity.
"Agreement" means this agreement and all of its Schedules and Exhibits.
"Alliances' Customer" means any person, other than Horizon, purchasing from
the Alliances (i) PCS service or (ii) any other services offered for sale by the
Alliances.
"Alliances' Network" has the meaning assigned to the term in the Recitals.
"CFW" means CFW Communications Company, a Virginia corporation.
"Effective Date" has the meaning assigned to the term in the Preamble.
"ESN" means the electronic equipment number for each handset.
"Facilities" means the telecommunications switching equipment, cell site
transceiver equipment, towers, connecting circuits, software and other equipment
installed, maintained, expanded, modified or replaced by the Alliances to render
PCS Service within a Market.
"FCC" means the Federal Communication Commission or any successor agency.
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"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, or any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
including the FCC.
"Handsets" means the mobile handsets to be used by Horizon End Users and
any other terminal equipment designed to be used by Horizon End Users and to be
compatible with Sprint PCS networks.
"Horizon" has the meaning assigned to the term in the Preamble.
"Horizon End User" means any person purchasing Private Label Service from
Horizon, including without limitation customers of Sprint PCS, customers of a
Sprint PCS Manager and customers of a PCS operator who uses the Sprint PCS
service marks as its primary or secondary service marks throughout its PCS
operations.
"Horizon Retail Location" means a retail establishment which has an
agreement to sell either Horizon or Sprint PCS Handsets which is located within
an area that could be reasonably assumed to have on-street coverage from an
Alliance cell site or could otherwise be reasonably expected to be within the
PCS Service Coverage Area as defined in Schedule 7.7.
"Interim Agreement" means the Network Agreement, dated as of November 11,
1998, among Horizon, WV Alliance and VA Alliance.
"Licenses" means the PCS licenses issued by the FCC to the Alliances, which
authorize the provision of PCS services in the Markets.
"Management Agreement" means the Management Agreement, dated June 8, 1998,
by and between Horizon and Sprint PCS, as amended from time to time.
"Markets" means the Basic Trading Areas (as defined by the FCC) set forth
in Schedule 1 (Markets) in which PCS Service is to be made available to Horizon
pursuant to this Agreement and the Licenses. A "Market" is any one of such Basic
Trading Areas. Schedule 1 may be updated to include additional BTAs based on
mutual written agreement by the parties. Such additional BTAs may include BTAs
for which one or more owners of the Alliances (rather than the WV Alliance or
the VA Alliance) presently control the Licenses.
"MIN" means a mobile identification telephone number.
"PCS" means all radio communications that encompass mobile and ancillary
fixed communication as set forth in 47 C.F.R. Part 24.5, which as of the
Effective Date utilizes frequency bands approaching 1.9 gigahertz in broadband.
"PCS Service" means the PCS service provided to Horizon by the Alliances as
more particularly described in Schedule 2 (PCS Service and Pricing). PCS Service
does not include roaming or long distance services.
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"Private Label Service" means the service provided by Horizon to its
Horizon End Users, utilizing the PCS Service provided to Horizon by the
Alliances, under Horizon's and/or Sprint PCS' labels, brands and marks, or other
labels, brands or marks which Horizon is permitted to use under the Management
Agreement.
"Sprint PCS" means, collectively, Sprint Spectrum L.P. and Sprint Com, Inc.
"Sprint PCS Manager" means an entity (such as Horizon) which provides
Sprint PCS branded PCS service pursuant to a management agreement between such
entity and Sprint PCS.
"Start Date" means, for each Market, the date specified as "Start Date" in
Schedule 1 (or in the amendment to this Agreement which adds a Market) and if no
date is specified, the date on which Horizon first initiates Private Label
Service in a Market.
2. HORIZON RELATIONSHIP
Subject to the terms and conditions of this Agreement, the Alliances will
provide and sell PCS Service to Horizon in the Markets, and Horizon will
purchase PCS Service from the Alliances in the Markets and pay the Alliances for
PCS Service as more specifically described in Schedule 2. The Alliances
authorize Horizon to market and sell the service as Private Label Service in
each Market to Horizon End Users subject to the terms and conditions of this
Agreement. The parties expressly agree that use (including, but not limited to,
roaming use) of the Alliances' Network by Third Parties (meaning those parties
other than Horizon, Sprint PCS, Sprint PCS Managers and PCS operators who use
the Sprint PCS service marks) is not covered by this Agreement and Horizon,
Sprint PCS, Sprint PCS Managers and PCS operators who use the Sprint PCS service
marks shall have no right to revenues or any other interests resulting from such
Third Party use of the Alliances' Network. No provision of this Agreement will
be construed as vesting in Horizon any control whatsoever in any facilities and
operations of the Alliances, including the Facilities, or the operations of any
Affiliate of the Alliances. Horizon will not represent itself as a FCC, federal
or state certified licensee for PCS in the Markets by reason of this Agreement.
3. TERM
3.1 GENERAL
Subject to the early termination provisions set forth in Section 14 and the
renewal provisions of Section 3.2, the term of this Agreement will be for the
period commencing on the Effective Date and extending until June 8, 2008.
3.2 RENEWAL
This Agreement will automatically renew beyond the initial term set forth
in Section 3.1 for four separate renewal periods of ten years each (with a
maximum Agreement duration of 50 years), unless (a) Horizon gives written notice
to the Alliances on or before the date which is 180 days prior to the end of the
initial term or the applicable renewal term, as the case may be; or (b) the
Alliances give written notice to Horizon on or before the date which is 24
3
months prior to the end of the initial term or the applicable renewal term, as
the case may be.
3.3 PHASE-OUT PERIOD
Upon expiration of the term of the Agreement pursuant to this Section 3,
the applicable phase-out period set forth in Section 14.5 will apply. During the
phase-out period, the Alliances agree to offer to sell PCS service to Horizon in
accordance with Section 14.5.
4. REPRESENTATIONS AND WARRANTIES
Each party makes the following representations and warranties, as
applicable, as of the Effective Date:
4.1 DUE INCORPORATION OR FORMATION; AUTHORIZATION OF AGREEMENT
The party is a company duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization and has the full
power and authority to execute and deliver this Agreement and to perform its
obligations under this Agreement.
4.2 NO CONFLICT; NO DEFAULT; ENFORCEABILITY
Neither the execution, delivery and performance of this Agreement nor the
consummation by the party of the transactions contemplated in this Agreement
will conflict with, violate or result in a breach of (a) any applicable law,
regulation, order, writ, injunction, decree, determination or award of any
Governmental Authority, (b) any of the terms, conditions or provisions of the
certificate of organization, bylaws or other governing documents of the party,
or (c) any material agreement or instrument to which the party is or may be
bound or to which any of its material properties, assets or businesses is
subject. This Agreement represents the valid and binding obligation of the
party, enforceable in accordance with its terms. Horizon represents that
entering into this Agreement will not conflict with the Management Agreement.
4.3 LITIGATION
There are no actions, suits, proceedings or investigations pending or, to
the knowledge of the party, threatened against or affecting the party or any of
its properties, assets or businesses in, before or by any Governmental Authority
which could, if adversely determined, reasonably be expected to have a material
adverse effect on the party's ability to perform its obligations under this
Agreement.
4.4 NETWORK
WV Alliance represents that it has title to, or a leasehold interest in,
the Alliances' Network as located within the BTAs identified in Schedule 1 as
"WV Alliance BTAs," including, but not limited to, (i) title to all cell site
equipment such as base stations and antennas and related PCS infrastructure,
(ii) title to, or a leasehold interest in, towers and other space as required
for the attachment of all PCS antennas and location of base station equipment,
4
and (iii) title to, or a leasehold interest in, switching equipment utilized for
the Alliances' Network within the WV Alliance BTAs, except in each case for
minor defects in title, easements, restrictive covenants and similar
encumbrances or impediments that, in the aggregate, do not and will not
materially interfere with its ability to provide the PCS Service to Horizon. VA
Alliance represents that it has title to, or a leasehold interest in, the
Alliances' Network as located within the BTAs identified in Schedule 1 as "VA
Alliance BTAs," including, but not limited to, (i) title to all cell site
equipment such as base stations and antennas and related PCS infrastructure,
(ii) title to, or a leasehold interest in, towers and other space as required
for the attachment of all PCS antennas and location of base station equipment,
and (iii) title to switching equipment utilized for the Alliances' Network
within the VA Alliance BTAs, except in each case for minor defects in title,
easements, restrictive covenants and similar encumbrances or impediments that,
in the aggregate, do not and will not materially interfere with its ability to
provide the PCS Service to Horizon.
5. SCOPE OF PCS SERVICE; HANDSET HANDLING; MIN ADMINISTRATION; BILLING
5.1 PCS SERVICE
During the term of this Agreement, the Alliances agree to provide to
Horizon the PCS Service more specifically described in Schedule 2 in the
- ---------- Markets set forth in Schedule 1. ----------
5.2 HANDSET HANDLING SERVICES
Horizon will be responsible for making its own arrangements (a) to purchase
handsets and accessories for resale, from manufacturers selected by Horizon and
(b) for the delivery of those handsets and accessories directly to Horizon.
5.3 MIN ADMINISTRATION
Unless the parties otherwise agree, Horizon will be responsible for the
administration of its own MIN ranges for each Market, and the Alliances will
route and bill Horizon for PCS Service accordingly. The parties agree to work
together in good faith to coordinate MIN administration, including sufficient
advance notice necessary to implement the terms of this Section.
5.4 CALL DETAIL RECORDS
The Alliances will endeavor to develop and implement, as promptly as
possible, a process to regularly provide electronic call detail records to
Horizon on a near-real time basis ("Electronic Billing"). In any event, the
Alliances agree that Electronic Billing will be implemented on or before the
six-month anniversary of the Effective Date. Such provision of Electronic
Billing will require Horizon to provide for network facilities to transport call
detail records. It is contemplated that such electronic call detail records will
be provided in native format. For purposes of this Agreement, the term "near
real time basis" means the period of time in which the Alliances can read their
own call detail records for the Alliances' Customers; provided that such period
of time will not exceed the period of time that Horizon can read its own call
5
detail records for similar calls placed through Horizon's own switch. Until the
date on which Electronic Billing is implemented, the Alliances will provide call
detail records to Horizon in a reasonable format within the same (or shorter)
period of time that the Alliances provide such call detail records to those
persons or agents responsible for billing the Alliances' retail customers, but
in no event will such time period exceed four days. These records will be
materially free of defects. With respect to payment for defective call detail
records, Horizon may, in addition to any other rights and remedies available to
Horizon, dispute such payments under the procedures set forth in Section 6.3.
Horizon will have no responsibility for paying invoices for services to the
extent that the Alliances do not forward the call detail records for Horizon End
Users to Horizon [for a clearinghouse, as appropriate] within sixty (60) days
after the occurrence of a call.
5.5 YEAR 2000 COMPLIANCE
Each party will comply with its obligations under this Agreement without
interruption attributable to the failure of its network hardware or software to
process correctly calendar date-related data. 6. PRICES AND TERMS OF PAYMENT
6.1 PAYMENT OF CHARGES
Horizon is liable and will pay the Alliances for any and all charges
associated with the use of the PCS Service by Horizon, as set forth in Schedule
2. Disputed charges are governed by the procedures set forth in Section 6.3. All
prices and charges stated in this Agreement are in US dollars.
6.2 INVOICES
The Alliances will provide to Horizon monthly invoices of the charges
incurred by Horizon. Horizon will be liable to the Alliances for those charges
and will pay them in accordance with the provisions of this Section 6. Payment
for each invoice is due within 40 days of the billing date. Interest, at a daily
interest rate equal to .0491%, compounded monthly, shall begin to accrue on
payments which are not made by the due date.
6.3 DISPUTED CHARGES
6.3.1 GENERAL
Horizon may withhold payment of any properly disputed portion of any
invoice until the dispute is resolved as set forth in this Section 6.3. Horizon
must pay the undisputed amount of any invoice in a timely manner as provided in
Section 6.2. Upon resolution of any dispute, payment of any disputed and
withheld amount that is determined to be due and owing (including interest, at a
daily interest rate equal to .0491%, compounded monthly) is due and payable
within 10 days following resolution of the dispute as provided in this Section
6.3.
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6.3.2 STANDARD DISPUTE PERIOD
If Horizon intends not to pay all or part of an invoice as a result of
Horizon's reasonable belief that a charge is not appropriate, Horizon will
provide to the Alliances written notice of any disputed charges, together with a
detailed explanation of the nature of the dispute, on or before the date on
which the payment is due. The Alliances will respond to Horizon in writing with
regard to the disputed charges within 10 business days after receipt of
Horizon's dispute notice, and will credit Horizon's account within the 10
business day period if the Alliances agree that such resolution is appropriate.
If the Alliances' written response regarding the disputed charges reasonably
demonstrates that such charges are correct, Horizon shall pay any disputed and
withheld amount, including interest, as provided for in Section 6.3.1.
Notwithstanding the foregoing, if the parties are unable to resolve any such
disputes within 30 days of the date of the Alliances' response, either party may
initiate the arbitration proceedings set forth in Section 18.16.
6.3.3 BILLING ERRORS
Following payment of an invoice, if a party discovers a billing error has
occurred, the party will provide notice of such billing error to the other party
as soon as practical upon detection. After receiving notice of a billing error,
the other party will respond in writing to the party detecting the billing error
within 10 business days after receipt of the billing error notice. Upon
resolution, payment of amounts that are determined to be due and owing as a
result of such billing error (exclusive of any interest charges reflecting the
time value of the billing error) will be due and payable within 30 days
following resolution. If payment is not made within such 30-day period, the
amount due will be adjusted to include interest at a daily interest rate equal
to .0491%, compounded monthly. No corrections or adjustments will be made for
billing errors uncovered or reported more than 365 days after the billing date.
If the parties are unable to resolve billing errors within 60 days of the date
of response by the party receiving the billing error notice, either party may
initiate the arbitration proceedings set forth in Section 18.16.
6.4 TAXES AND OTHER LEVIES BY GOVERNMENTAL AUTHORITIES
6.4.1 TAXES
The rates and charges set forth on Schedule 2 are inclusive of all sales or
similar taxes imposed on the PCS Services provided by the Alliances to Horizon,
and the Alliances agree that no amounts for taxes will be added to the rates and
charges set forth on Schedule 2. The Alliances will remit such taxes to the
appropriate Governmental Authorities.
6.4.2 OTHER LEVIES BY GOVERNMENTAL AUTHORITIES
The Alliances will be solely responsible for the timely and accurate
remittance of all taxes, fees and other charges of Governmental Authorities with
regard to the ownership and operation of the Alliances' Network.
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6.5 ADJUSTMENTS FOR PCS SERVICE OUTAGES
If the Alliances' Network suffers a service outage (other than for
customary planned outages for maintenance) which affects at least a Minimum
Number of cell sites and such outage continues for more than six hours, the
Alliances will provide a credit on Horizon's billing invoice for PCS Services
for the month of the outage (an "Outage Credit"). For purposes of this Section
6.5, a Minimum Number of cell sites shall be equal to (a) [***] of the number of
cell sites which are being used to provide the PCS Services as of the date of
the outage, with respect to an outage which occurs during the first year after
the Effective Date, (b) [***] of the number of cell sites which are being used
to provide the PCS Services as of the date of the outage, with respect to an
outage which occurs during the second year after the Effective Date, and (c)
[***] of the number of cell sites which are being used to provide the PCS
Services as of the date of the outage, with respect to an outage which occurs
during the third year after the Effective Date and thereafter. The Outage Credit
will be equal to [***]. No adjustments will be processed unless they aggregate
to more than $1,000 during any single monthly billing cycle; provided that such
minimum amount will increase on each anniversary date of this Agreement by the
percentage increase in the Consumer Price Index for the previous twelve months.
As used herein, the phrase "Consumer Price Index" shall mean the Consumer Price
Index for All Urban Consumers: U.S. City Average (1982-84-100), published by the
Bureau of Labor and Statistics of the United States Department of Labor, or such
other similar index designated by the parties in the event such index is no
longer published.
6.6 PRICE ADJUSTMENTS
6.6.1 ADJUSTMENTS IN GENERAL
The parties agree and acknowledge that the pricing of the PCS Service may
be revised periodically by mutual agreement. The Alliances agree that the
pricing set forth on Schedule 2 (and all future price adjustments) reflect
pricing that is, in each category, no more than the lowest price which is, at
any time, being offered or provided by the Alliances or any of their Affiliates
to any other wholesale Alliances Customer other than the owners of the Alliances
and their subsidiaries and Affiliates (including Virginia RSA6 Partnership),
under comparable terms and conditions. The Alliances will endeavor to develop
pricing structures to assure that prices for PCS Service provided to Horizon are
lower than the lowest price which is, at any time, being offered or provided by
the Alliances to any other wholesale customer other than the owners of the
Alliances and their subsidiaries and Affiliates, subject to compliance with
applicable law. The parties further agree that the pricing set forth on Schedule
2 (as amended from time to time) will apply to the use of the Network by all
Horizon End Users.
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6.6.2 PROPOSED ADJUSTMENTS
The Alliances and Horizon agree that they may propose price increases or
price decreases, as the case may be, beginning on the first anniversary of the
Effective Date. Proposed price increases or decreases must be commercially
reasonable. In the event that the parties are unable to mutually agree upon a
price increase or decrease, either party may submit the issue to binding
arbitration pursuant to Section 18.16. The arbitrator shall be instructed to
select either (a) the Alliances' proposed price adjustment, (b) Horizon's
proposed price adjustment or (c) a price adjustment which is between the
Alliances' proposal and Horizon's proposal.
6.7 PRICING FOR ANCILLARY NETWORK PLATFORMS
The parties anticipate that, from time to time, the Alliances may offer,
and Horizon may purchase, certain ancillary network platforms and elements which
are not included in the PCS Service described in Schedule 2 and which are not
required as an inherent element of the services covered by the Management
Agreement. Schedule 6.7 attached hereto contains the description and pricing for
certain ancillary network platforms and elements which have been agreed to by
the parties as of the Effective Date. By mutual agreement, the parties may amend
Schedule 6.7 in the future to add additional ancillary network platforms and
elements to be provided by the Alliances.
7. RIGHTS AND OBLIGATIONS OF THE PARTIES
7.1 THE ALLIANCES' REPRESENTATIVE
As the "single point of contact" with Horizon with respect to the
monitoring and administration of this Agreement, the Alliances agree to appoint
one individual who will be either an employee of one of the Alliances or an
employee of the company that has contracted to be the principal service provider
to the Alliances for purpose of this Agreement (currently, CFW Communications
Company). Such employee shall have, as one of his or her primary functions, the
responsibility and accountability for the administration of this Agreement. Such
employee shall have no direct responsibility for the retail performance of the
Alliances in the Markets and shall have the responsibility to resolve Horizon's
requests throughout the Alliances' Network.
7.2 PURCHASER'S RESPONSIBILITY AND LIABILITY RELATED TO PRIVATE LABEL SERVICE
Horizon will be responsible and liable for Horizon End User credit
verification, billing, collection, customer service, and all similar support
necessary to provide Private Label Service and all risks and expenses related to
such services. Horizon will not make any representation, warranty or covenant to
any Horizon End User that would misrepresent or conflict with the terms and
conditions of this Agreement. Horizon may provide written terms and conditions
of service to Horizon End Users or enter into written contracts with Horizon End
Users.
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7.3 INTERFERENCE
The parties' agents, employees, and representatives shall not interfere
with the operation of the Facilities, the Alliances' Network or the PCS Service
in a way as to impair the quality of service provided to Horizon End Users or
Alliances Customers. Upon discovery of such interference by either the Alliances
or Horizon, the party discovering the interference will promptly notify the
other party and that party shall promptly use its best efforts to cause such
interference to terminate.
7.4 NETWORK REQUIREMENTS
7.4.1 GENERAL REQUIREMENTS
Sections 7.4.1 and 7.4.2 and the accompanying Schedule 7.4.1 attached
hereto (collectively, "Specifications") set forth the general, operation, and
performance requirements, which the Alliances shall satisfy in providing
services under this Agreement. Alliances and Horizon agree that the
Specifications set forth as of the Effective Date are intended to be applicable
for at least 18 months following the Effective Date. Notwithstanding the
foregoing, Horizon will amend the Specifications, subject to the terms set forth
in this Section 7.4.1 and Sections 6.6, 7.4.2 and 14 to the extent that,
pursuant to the Management Agreement, similar requirements are amended by Sprint
PCS for its own network and for those networks operated by Horizon and other
managers of Sprint PCS' network; provided, however, that, if Horizon is not in
compliance with such amended requirements, the Alliances shall only be required
to comply with such new requirements to the same extent that Horizon's network
complies with such amended network requirements. Notwithstanding the foregoing,
Horizon will not, within the last 24 months of the term of this Agreement (or
any renewal term), amend the Specifications pursuant to the preceding sentence
in a manner which will materially increase the Alliances' costs of providing PCS
Service, unless Horizon agrees that it will not provide a notice of non-renewal
as provided in Section 3.2 with respect to the next succeeding term. Throughout
the term of this Agreement, Horizon agrees to promptly inform the Alliances
about its network plans and provide amendments to the Specifications to the
Alliances as soon as reasonably possible so as to permit the Alliances to
develop network and operations plans and assure such costs of implementation can
be considered in proposing its prices for PCS Service (and other services
provided to Horizon under this Agreement); Horizon further agrees to provide for
a commercially reasonable implementation period to assure compliance with these
requirements.
Subject to the Specifications set forth in Schedule 7.4.1 to this
Agreement, the Alliances agree that (a) the Network will be compatible with the
Handsets which operate on Sprint PCS' network; and (b) the Alliances' Network
will provide continuity into Horizon platforms to ensure seamless functionality
with the operation of other networks operated by Horizon and Sprint PCS,
provided that Horizon provides seamless functionality with the operation of
other networks operated by Sprint PCS.
Upon written notice by Horizon, the Alliances will use their reasonable
best efforts to provide an acceptable level of call quality for PCS Service
inside all Horizon Retail Locations (including the use of repeaters and other
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amplification techniques, where appropriate), provided that such Horizon Retail
Locations can reasonably be expected to generate a minimum level of sales if
such efforts are applied. A Horizon Retail Location shall be deemed to generate
a minimum level of sales if (a) such Horizon Retail Location represents a
national or regional account of Sprint PCS or its Affiliates, (b) such Horizon
Retail Location generates at least [***] of its revenues from the sale of
electronic equipment; provided, that such location has on-street coverage from
the Alliances' Network and that such location generated at least [***] in annual
revenues for the prior calendar year or (c) Horizon reasonably demonstrates that
a minimum level of sales acceptable to the Alliances can be expected from the
Horizon Retail Location, provided that, if Alliances determine that the expected
minimum level of sales is unacceptable, at Horizon's option, Alliances will use
their reasonable best efforts to provide an acceptable level of call quality at
such Horizon Retail Location and the direct, out-of-pocket costs of such efforts
shall be reimbursed by Horizon to Alliances.
7.4.2 OPERATION AND PERFORMANCE OF THE ALLIANCES' NETWORK
The Alliances agree that the Alliances' Network will comply with all
Horizon network requirements for operation and performance of the Alliances'
Network, as set forth on Schedule 7.4.2 (as amended); provided, however, that,
if Horizon is not in compliance with such operational requirements, the
Alliances shall only be required to comply with such requirements to the same
extent that Horizon's network complies with such operational requirements; and
further provided that Horizon provides the Alliances with a commercially
reasonable period of time to assure compliance. Notwithstanding the foregoing,
Horizon agrees that the Alliances are only required to comply with Schedule
7.4.2 to the extent the requirements set forth therein are applicable to the
services actually being provided by the Alliances. For example, Schedule 7.4.2
includes requirements for directory assistance, operator services, voice mail
and AIN platforms although the Alliances are not required to perform such
services as of the date of this Agreement. Horizon further agrees that a failure
by the Alliances to comply with the requirements of Schedule 7.4.1 and Schedule
7.4.2 shall not result in a breach of this Agreement provided that the Alliances
satisfy in all material respects those requirements of Schedule 7.4.1 and
Schedule 7.4.2 that relate to performance or that can be considered to have a
potential future impact upon performance as determined in Horizon's reasonable
judgment.
7.4.3 [INTENTIONALLY OMITTED]
7.4.4 INCREASE IN COVERAGE
If, at any time during the term of this Agreement, Horizon desires to have
additional geographic coverage within a Market served by the Alliances' Network,
then Horizon shall provide the Alliances with a written request to expand the
coverage area of the Alliances' Network within a Market. If, within 60 days of
receipt of such written notice, the Alliances do not provide Horizon with a
written commitment to diligently develop such additional coverage within a
reasonable period of time, or if the Alliances do not develop such additional
coverage within such reasonable period of time, Horizon shall have the right to
construct its own cell sites or to take other action to provide such additional
coverage, without breaching this Agreement or incurring liability to the
Alliances. If, pursuant to this Section 7.4.4, Horizon constructs its own cell
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sites or takes such other action to increase the coverage area, (a) such cell
sites or other construction will be owned by Horizon, (b) Horizon will have the
right to connect such sites or other construction to the Alliances' Network and
platforms, (c) the Alliances will coordinate with Horizon, at Horizon's request,
for the seamless operation and connectivity of the new cell sites with the
Alliances' Network, and (d) the Alliances may, at Horizon's option, have the
right to use such new cell sites. If, pursuant to this Section 7.4.4, Horizon
constructs its own cell sites and if the Alliances request the right to use one
or more of such sites for their own network, the Alliances agree to compensate
Horizon for such use at a rate equal to the greater of [***] per minute or [***]
the then-current rate per minute, as set forth in Schedule 2 (as amended from
time to time). For purposes of this Section 7.4.4, Horizon shall have the right
to delegate its right to construct such cell sites to Sprint PCS, subject to the
terms and conditions of this Section. Nothing in this Section 7.4.4 shall
prohibit the Alliances from expanding coverage in the Markets at their own
discretion.
7.4.5 MODIFICATIONS
Subject to the Alliances' compliance with the Specifications, the Alliances
may, in their sole discretion, change or update the Facilities or the Alliances'
operations, equipment, software, procedures or services, provided that such
changes or updates shall not unreasonably interrupt, suspend, delay or change
the quality or functionality of the PCS Service and provided that the Alliances
give Horizon at least 7 days prior written notice of such changes and updates.
The Alliances may, in their sole discretion, offer service products that are not
part of the PCS Service, provided that such products will not cause any material
adverse impact to Horizon End Users. 7.4.6 THE ALLIANCES' REPORTS TO HORIZON
The Alliances will provide Horizon with real time Internet access to
performance data for elements of the Alliances' Network which are to be used by
Horizon. Such performance data shall be sufficient in scope and detail to
establish compliance with the Specifications and shall include the data and
access described in Schedule 7.4.6, which shall be amended from time to time as
performance-related Specifications change. In addition, the Alliances will
provide network utilization reports on a monthly basis, which reports will show
changes in network coverage, service enhancements, feature upgrades and repeater
installations. The Alliances agree to provide at least 90 days advance notice
prior to the implementation of any material changes to the items set forth in
the previous sentence; provided, however, that if, for emergency or other
compelling reasons, the Alliances must implement such changes in a shorter time
period, it will provide prompt notice to Horizon upon the determination by the
Alliances to make such changes.
7.5 ROAMING SERVICES
This Agreement does not grant to the Alliances any roaming or resale rights
with respect to any Horizon or Sprint PCS networks, except as set forth in
Section 15 or as may be agreed upon in separate agreements.
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7.6 THE ALLIANCES' NETWORK FRAUD DETECTION AND RESPONSIBILITY [SLASL
To the extent that Horizon and the Alliances mutually agree that the
Alliances will provide primary fraud analysis for Horizon, the prices, terms and
conditions shall be set forth in a separate agreement or in an amendment to this
Agreement. Unless the parties mutually agree otherwise, it is contemplated that
Horizon will use its own HLR or HLR-like capabilities to handle its own primary
fraud analysis.
7.7 COVERAGE AREA
The Alliances shall provide coverage in the Markets that are set forth in
Schedule 1. Within such Markets, the Alliances shall use commercially reasonable
efforts to provide the levels of coverage described on Schedule 7.7.
Notwithstanding anything to the contrary, if the Alliances fail to provide
levels of coverage which are substantially equivalent to the coverage described
in Schedule 7.7, the Alliances shall be in default under this Agreement. The
parties may amend Schedule 7.7 from time to time in writing, based on mutual
agreement.
Horizon shall provide coverage in the Markets that are set forth in
Schedule 15.1. Within such Markets, Horizon shall use commercially reasonable
efforts to provide the levels of coverage described on Schedule 15.1.
Notwithstanding anything to the contrary, if Horizon fails to provide levels of
coverage which are substantially equivalent to the coverage described in
Schedule 15.1, Horizon shall be in default under this Agreement. The parties may
amend Schedule 15.1 from time to time in writing, based on mutual agreement.
7.8 OVERBUILDS
Subject to the Alliances' rights as set forth in Section 14.2,
nothing in this Agreement shall prohibit Horizon's right to construct and launch
(at its own cost) its own network in the Markets by using FCC licenses other
than the Licenses.
8. LICENSES
8.1 GENERAL
The Alliances represent that one of the Alliances is the sole holder of
each of the Licenses. During the term of this Agreement, the Alliances agree
that they will comply in all material respects with all FCC rules and
regulations regarding the Licenses and will use their reasonable best efforts to
maintain such Licenses and to refrain from any action or inaction which may
result in the revocation or other loss of the Licenses. The Alliances will
provide Horizon with any and all notices from the FCC which could materially
affect the Alliances' ownership of the Licenses, the provision of PCS Service to
Horizon or the Alliances' performance of any other material covenant or
obligation in this Agreement. The Alliances represent and warrant that the
Licenses are in full force and effect and are not subject to any petition to
deny or petition for reconsideration and that no other party holds any interest
of any nature with regard to the Licenses, other than security interests held by
senior secured lenders to the Alliances or by the FCC or its agents. Horizon
agrees to use commercially reasonable efforts not to take any action that would
13
jeopardize the Alliances', or another License holder's, ability to hold the
Licenses without penalty.
8.2 RENEWALS
The Alliances agree that they will use their reasonable best efforts to
obtain renewals of the Licenses throughout the term of this Agreement and,
specifically, will file all required applications for renewal and will
diligently and promptly pursue such renewal applications unless the Alliances
reasonably determine that the FCC has imposed such burdens upon the renewal of
the Licenses that it is not commercially reasonable to renew such Licenses. In
the event the Alliances determine that it is not commercially reasonable to
renew such Licenses, the Alliances shall give Horizon written notice of such
determination no later than 150 days prior to the expiration of the term of the
Licenses (or any renewal term); provided, however, that in the event the
Alliances shall have determined to assign this Agreement, in accordance with the
provisions of Section 17.2, with respect to a Market for which there is a
License as to which a notice of non-renewal has been given, the Alliances shall
have the right to withdraw such notice and pursue the transfer of such License
to the proposed assignee. To exercise such right, the Alliances must give
written notice to Horizon prior to sixtieth day before the expiration of the
License, and the Alliances must provide Horizon with satisfactory assurances
that the transfer of such License is reasonably likely to be approved by the FCC
with the result that Horizon would not experience an interruption of service in
such Market. In the event the Alliances give a non-renewal notice and do not
withdraw such notice as provided above, Horizon may, at its option, give written
notice, no later than 60 days prior to the expiration of the Licenses, to the
Alliances that the Alliances must file an application for FCC approval to
transfer the Licenses from the Alliances to Horizon or one of its Affiliates and
that the Alliances must reasonably cooperate with Horizon to pursue the transfer
and renewal of the Licenses. To the extent permitted by law, the parties will
use their reasonable efforts to avoid the public disclosure of such filing.
Horizon agrees to promptly reimburse the Alliances for the reasonable legal and
other costs associated with the development, filing and prosecution of such
application and the cooperation in pursuing the renewal. If the FCC approves
such application for transfer, then, upon Horizon's request, the Alliances will
transfer the Licenses (for no consideration) to Horizon or its Affiliate prior
to the License expiration, and Horizon shall be responsible for any renewal fees
required by the FCC. Notwithstanding the foregoing, in the event that (a) the
Alliances withdraw a notice of non-renewal (as provided in the second sentence
of this Section) and (b) the Alliances receive a bona fide offer to purchase
such Licenses from a third party, the Alliances will deliver such offer to
Horizon, and Horizon will have the right to purchase such Licenses, for the
price and on the terms and conditions set forth in the offer. Horizon may
exercise such right by giving written notice to the Alliances within 10 business
days of Horizon's receipt of such offer.
9. AUDIT
9.1 GENERAL
Each party will maintain complete and accurate records during the term of
this Agreement and for 12 months following conclusion or expiration of all
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post-agreement payment obligations of all parties in a consistent form to
substantiate the monetary payments and reporting and other obligations of one
party to the other party under this Agreement. Each party may, upon reasonable
prior written notice, conduct during the other party's regular business hours,
and in accordance with applicable law and reasonable security requirements,
audits of those records. Each party may seek a general audit of the other party
no more than once every 12 months. In addition, each party may seek limited
specific audits of specific disputed payment and reporting obligations, no more
than once every 3 months. These audit rights will survive until the period
ending 12 months following conclusion or expiration of all post-agreement
payment obligations of all parties under this Agreement. During the term of this
Agreement, the Alliances hereby grant reasonable access to Horizon and its
representatives to review and inspect the Alliances' Network, including without
limitation individual cell sites and the switch location, provided that Horizon
provides reasonable advance notice to the Alliances. During such review and
inspection, Horizon may elect to be accompanied by representatives of Sprint
PCS.
9.2 PROCEDURE
Audits will be conducted in accordance with the following restrictions: (a)
the audit may be conducted by employees of the auditing party and/or by
third-party representatives, (b) the audited party may require the auditing
party's employee to conduct the audit on the premises of the audited party, (c)
the audited party will have the right to have an employee or representative
present at all times during the audit, (d) the auditing party will not have
direct access to the audited party's computer database without the consent of
the audited party, and will be entitled to review only those specific records of
the audited party directly related to the monetary obligations of the audited
party under this Agreement, (e) the auditing party will provide reasonable
advance notice of the audit, the audit will be scheduled at a mutually
acceptable time, and the parties will avoid, to the extent reasonably practical,
scheduling such audit in the months of January or February. Subject to the
restrictions set forth above, the audited party will cooperate fully with the
auditing party. All reasonable fees and costs incurred (including a reasonable
charge for the services of any employee of the audited party directly involved
in the audit) by either party in connection with those audits will be paid by
the auditing party. The audited party will have the right to have the results of
any audit reviewed by the audited party's internal auditing staff or by the
audited party's independent accountants who then audit the financial statements
of the audited party ("Independent Auditors"). The cost of an internal or
Independent Auditors' review will be borne by the audited party. The audited
party must use its commercially reasonable efforts to immediately correct any
material deficiencies related to performance uncovered by an audit.
10. WARRANTIES.
Except as otherwise provided in this agreement, the Alliances make no
warranties, express or implied, regarding the PCS Service or, if applicable, any
equipment, including any warranties of merchantability or fitness for a
particular purpose. The Alliances do not authorize anyone to make any warranty
on their behalf, and Horizon should not rely on any such statement. Horizon
expressly acknowledges that the Alliances are not the manufacturer of any
equipment.
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11. TRADE NAME, TRADE MARKS AND SERVICE MARKS
11.1 THE ALLIANCES' RIGHTS
Horizon recognizes the right, title and interest of the Alliances in and to
all service marks, trademarks, trade names, trade dress, logos and other indicia
of origin used in connection with the service and products sold by the Alliances
(collectively, the "Alliances' Marks"). Horizon will not engage in any
activities or commit any acts, directly or indirectly, that contest, dispute, or
otherwise impair, or that may contest, dispute or otherwise impair the right,
title or interest of the Alliances therein. Horizon acknowledges and agrees that
nothing in this Agreement grants to Horizon the right to use and Horizon agrees
that it will not use any of the Alliances' Marks or any service mark, trademark,
trade name, trade dress, logos and other indicia of origin that is confusingly
similar to or a colorable imitation of any of the Alliances Marks and will not
incorporate the Alliances' Marks into service mark, trademark, trade name, trade
dress, logos and other indicia of origin used or developed by Horizon. Horizon
does not acquire or claim any right, title or interest in or to the Alliances'
Marks through purchase of PCS Service or Products, the provision of Private
Label Service or otherwise.
11.2 HORIZON'S RIGHTS
The Alliances recognize the right, title and interest of Horizon and its
Affiliates in and to all service marks, trademarks, trade names, trade dress,
logos and other indicia of origin used in connection with the service and
products sold by Horizon and its Affiliates, including without limitation Sprint
PCS marks or other marks which Horizon is permitted by use under the Management
Agreement (collectively, the "Horizon Marks"). The Alliances will not engage in
any activities or commit any acts, directly or indirectly, that contest,
dispute, or otherwise impair, or that may contest, dispute or otherwise impair
the right, title or interest of Horizon and its Affiliates therein. The
Alliances acknowledge and agree that nothing in this Agreement grants to the
Alliances the right to use and the Alliances agree that they will not use any
Horizon Mark or any service mark, trademark, trade name, trade dress, logos, or
other indicia of origin that is confusingly similar to or a colorable imitation
of any of the Horizon Marks and will not incorporate the Horizon Marks any into
any service mark, trademark, trade name, trade dress, logos, or other indicia of
origin, used or developed by the Alliances. The Alliances do not acquire or
claim any right, title or interest in or to the Horizon Marks through the
provision of PCS Service or products or otherwise.
11.3 REMEDIES FOR VIOLATIONS
If either party violates or threatens to violate Section 11, the other
party may exercise any right or remedy under this Agreement and any other right
or remedy that it may have (now or hereafter existing) at law, in equity or
under statute; provided, however, that such rights and remedies will not be
subject to the limitations set forth in Section 13.2. The parties agree that
damages for violations of Section 11 may be difficult to ascertain or inadequate
and that if either party violates or threatens to violate Section 11, the other
party may suffer irreparable harm and therefore may seek injunctive relief in
addition to any other right or remedy under this Agreement and any other right
or remedy that it may have (now or hereafter existing) at law, in equity or
16
under statute. The party that violates or threatens to violate Section 11 will
not raise the defense of an adequate remedy at law.
11.4 MARKETING OF PCS SERVICES
Each party agrees that, in the course of its marketing, advertising and
solicitation efforts directed to existing or potential Horizon End Users or
Alliances' Customers, it will use its reasonable efforts not to disclose that
the Alliances provide the Alliances' Network and platform in the Markets for the
offering of PCS Services by Horizon pursuant to this Agreement, except in direct
response to an unsolicited and specific inquiry from an existing or potential
customer regarding the ownership of the network used by Horizon to provide PCS
Services.
12. INSURANCE
12.1 HORIZON INSURANCE
Horizon must, during the term of this Agreement and at its sole expense,
obtain and keep in force, the following insurance: (a) Commercial General
Liability Coverage, including personal injury, bodily injury, property damage,
operations hazard, independent contractor coverage, contractual liability, and
products and completed operations liability, in limits not less than $3,000,000
for each occurrence (combined single limit), with Horizon named as insured in
the policy and the Alliances named as additional insured in the policy; and (b)
Worker's Compensation and Employer's Liability insurance. All required insurance
policies must be taken out with reputable national insurers that are licensed to
do business in the jurisdictions where Horizon is doing business. Horizon agrees
that certificates of insurance will be delivered to the Alliances within 15 days
of the Effective Date. All policies must contain an undertaking by the insurers
to notify the Alliances in writing not less than 30 days before any material
change, reduction in coverage, cancellation, or termination of the insurance.
The provision of insurance required in this Agreement will not be construed to
limit or otherwise affect the liability of Horizon to the Alliances.
12.2 THE ALLIANCES' INSURANCE
The Alliances must, during the term of this Agreement and at their sole
expense, obtain and keep in force, the following insurance: (a) Commercial
General Liability Coverage, including personal injury, bodily injury, property
damage, operations hazard, independent contractor coverage, contractual
liability, and products and completed operations liability, in limits not less
than $3,000,000 for each occurrence (combined single limit), with the Alliances
named as insured in the policy and Horizon named as additional insured in the
policy; and (b) Worker's Compensation and Employer's Liability insurance. All
required insurance policies must be taken out with reputable national insurers
that are licensed to do business in the jurisdictions where the Alliances are
doing business. The Alliances agree that certificates of insurance will be
delivered to Horizon within 15 days of the Effective Date. All policies must
contain an undertaking by the insurers to notify Horizon in writing not less
than 30 days before any material change, reduction in coverage, cancellation, or
termination of the insurance. The provision of insurance required in this
17
Agreement will not be construed to limit or otherwise affect the liability of
the Alliances to Horizon.
13. INDEMNIFICATION; LIMITATION OF LIABILITY
13.1 INDEMNIFICATION
Subject to the limitations set forth in Section 13.2, a party (the
"Indemnitor") agrees to indemnify, defend and hold harmless the other party and
its directors, officers, employees, agents, successors and assigns (separately
and collectively, the "Indemnitee") from and against any liabilities, claims,
demands, losses, damages, costs and expenses, including reasonable attorneys'
fees incurred or suffered by the Indemnitee, arising out of (a) a breach by the
Indemnitor of any covenant, representation or agreement in this Agreement, (b)
an act or omission of the Indemnitor in the performance or non-performance of
its obligations under this Agreement, (c) property damage or personal injury
which may be assessed against or incurred by the Indemnitee relating to or
arising out of any negligent, grossly negligent or intentional misconduct or
omission of the Indemnitor or its directors, officers, employees, agents,
successors and assigns in connection with the provision or use of services under
this Agreement or (d) the violation by the Indemnitor of any law, regulation or
ordinance applicable to the Indemnitor; provided, however, that this Section
13.1 shall not be applicable to a service outage which is otherwise covered by
Section 6.5 or a termination by Horizon pursuant to Section 14.3 or a
termination by the Alliances in which the Alliances are entitled to damages
pursuant to Section 14.6. This Section 13.1 is subject to the indemnification
procedures set forth in Schedule 13.1.
13.2 LIMITATION OF LIABILITY
EXCEPT FOR RIGHTS AND REMEDIES SPECIFICALLY PROVIDED FOR IN THIS AGREEMENT,
NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INDIRECT, INCIDENTAL,
SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES AS A RESULT OF THE PERFORMANCE OR
NON-PERFORMANCE OR BREACH OF ITS OBLIGATIONS UNDER THIS AGREEMENT, ITS ACTS OR
OMISSIONS RELATED TO THIS AGREEMENT OR ITS USE OF THE PCS SERVICES.
14. BREACH, REMEDIES AND EARLY TERMINATION OF THE AGREEMENT
14.1 BREACH
An event of default (an "Event of Default") shall occur if a party:
(i) falls to make a payment of money when due, which failure continues for
more than 10 business days after receipt of written notice from the
other party;
(ii) falls to comply with any other material representation, warranty,
obligation or covenant set forth in this Agreement (which shall not
include a determination by the Alliances not to upgrade the Alliances'
Network pursuant to a Sprint PCS- required amendment regarding
Sections 7.4.1 and 7.4.2 or the Specifications set forth in Schedule
18
7.4.1, which shall be governed by Section 14.3 hereof), which failure
either (A) continues for a period of more than 60 consecutive days
after receipt of written notice from the nonbreaching party specifying
the breach or (B) is of a nature to require more than 60 consecutive
days (after receipt of notice from the nonbreaching party specifying
the breach) to cure and continues for a period of more than the
shorter of (x) 120 consecutive days or (y) the period reasonably
required to cure; except that this extended cure period is only
available if the breaching party diligently works towards a cure;
(iii)fails to comply with Section 11, if that failure is not cured
promptly upon receipt of notice from the party owning or enforcing
that mark or in case of the repeated violations after receipt of the
notice on one occasion;
(iv) ceases to do business as a going concern;
(v) is unable or admits its inability to pay its debts as they become due;
or
(vi) institutes a voluntary proceeding, or becomes the subject of an
involuntary proceeding which involuntary proceeding is not dismissed
within 60 days, under any bankruptcy act, insolvency law or any law
for the relief of debtors, has a receiver appointed for the party
which appointment is not dismissed, vacated or stayed within 60 days,
or executes a general assignment for the benefit of creditors.
Upon the occurrence of an Event of Default, the non-breaching party may,
upon written notice to the breaching party, terminate this Agreement in its
entirety or with respect to one or more Markets, depending on the nature of the
breach, and, subject to the limitations set forth in Section 13.2, pursue any
other right or remedy under this Agreement, or at law or in equity, provided,
however, that in the event Horizon elects the remedies set forth in Section
14.4.1 or in the event that the Alliances are entitled to the remedies set forth
in Section 14.6, such remedies shall be the exclusive monetary remedies with
respect to such terminations; further provided that in the event Horizon elects
to terminate this Agreement with respect to one or more Markets pursuant to this
Section 14.1, any damages received by Horizon shall be net of any Outage Credits
received within the ninety day period prior to the delivery of such written
notice. Termination of this Agreement for any cause does not release either
party from any liability which, at the time of termination, has already accrued
to the other party, or which may accrue in respect of any act or omission prior
to termination or from any obligation which is expressly stated to survive the
termination. Horizon will remain responsible for its obligations to its agents
and Horizon End Users.
14.2 EARLY TERMINATION BY THE ALLIANCES
The Alliances may terminate this Agreement with respect to one or more
Markets in the event that, with respect to such Market(s), Horizon, Sprint PCS
or a Sprint PCS Manager constructs and commercially launches PCS Services
through a PCS network that overlaps the Alliances' coverage in such Market(s);
provided, however, that (a) this termination right shall not be applicable to
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[***] - CONFIDENTIAL TREATMENT REQUESTED
any Horizon build-outs which are pursuant to Section 7.4.4; and (b) a PCS
network constructed and commercially launched by Horizon, Sprint PCS or a Sprint
PCS Manager may, to the extent permitted by applicable law, overlap the
Alliance's coverage to a de minimus extent as necessary to provide a seamless
handoff between such coverage areas. In any event, Horizon must notify the
Alliances in writing as soon as practical prior to commencement of construction
as contemplated in this Section 14.2, with such notification to include its
proposed construction plans and launch date for commercial service. After
receipt of Horizon's notice, the Alliances may elect such termination right (to
be effective upon the commercial launch of such service) by giving prior written
notice to Horizon. With respect to the Market(s) subject to such termination,
the Alliances shall not be obligated to meet any new Specifications introduced
after the notification of the commencement of such construction with respect to
such Market(s). If, after Horizon notifies the Alliances of the commencement of
such construction, an Event of Default occurs in connection with the Alliances'
performance under this Agreement with respect to the terminated Market(s),
Horizon shall not have the rights and remedies set forth in Section 14.4.1, but
shall be entitled to seek damages and indemnification, without regard to the
limitations set forth in Section 13.2.
14.3 EARLY TERMINATION BY HORIZON
In addition to the termination rights set forth in Section 14.1, Horizon
may terminate this Agreement in its entirety or with respect to one or more
Markets in the event that, pursuant to Sections 7.4.1 and 7.4.2 and the
Specifications set forth in Schedule 7.4.1, Horizon requests that the Alliances
upgrade the Alliances' Network with respect to such Markets on the same basis on
which Horizon is required to upgrade its network pursuant to the terms of the
Management Agreement, and in the event that the Alliances notify Horizon that
they will not make such upgrade, or the Alliances fail to diligently commence
the development of such upgrade in a reasonable period of time, provided that
Horizon diligently commences with development of such upgrade on its own
networks for completion within the period of time requested of the Alliances,
such that the Alliances' ultimate compliance with the new upgrade requirements
is at least equal to Horizon's ultimate compliance. Horizon may elect such
termination right by giving 90 days prior written notice to the Alliances.
14.4 HORIZON'S RIGHTS
14.4.1 TERMINATION DUE TO BREACH BY ALLIANCE
In the event that Horizon terminates this Agreement in its entirety or with
respect to one or more Markets pursuant to Section 14.1 (other than pursuant to
subsection (iv) thereof), Horizon may, with respect to each Market which is
subject to such termination, elect to continue to use the Alliances' Network for
up to 36 months after such termination and to continue to receive the PCS
Service at the following discounts off of all of the pricing terms set forth on
Schedule 2 (as in effect on the date of termination, or if an arbitration
proceeding is pending pursuant to Section 6.6 as of the date of termination, the
pricing terms upon which the discounts apply shall be those determined pursuant
to arbitration): a) [***], [***], and [***] respectively, for successive 12
month periods if such termination occurs within the first year of this
Agreement; (b)
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[***] - CONFIDENTIAL TREATMENT REQUESTED
[***], [***], and [***] respectively, for successive 12 month periods if such
termination occurs within the second year of this Agreement; (c) [***], [***],
and [***], respectively, for successive 12 month periods if such termination
occurs within the third year of this Agreement; (d) [***], [***], and [***]
respectively, for successive 12 month periods if such termination occurs within
the fourth year of this Agreement; (e) [***], [***], and [***] respectively, for
successive 12 month periods if such termination occurs within the fifth year of
this Agreement; and ((f) [***] for a 36 month period if such termination
occurs after the fifth anniversary of this Agreement.
14.4.2 TERMINATION DUE TO ALLIANCE NON-COMPLIANCE WITH NETWORK UPGRADE
REQUIREMENTS
Except as provided for in Section 14.4.3 below, in the event that Horizon
terminates this Agreement in its entirety or with respect to one or more Markets
pursuant to Section 14.3, Horizon may, with respect to each Market which is
subject to such termination, elect to continue to use the Alliances' Network for
up to 36 months after such termination and to continue to receive the PCS
Service at the following discounts off of all of the pricing terms set forth on
Schedule 2 (as in effect on the date of termination, or if an arbitration
proceeding is pending pursuant to Section 6.6 as of the date of termination, the
pricing terms upon which the discounts apply shall be those determined pursuant
to arbitration): (a) [***], [***], and [***], respectively, for successive 12
month periods if such termination occurs within the first year of the Agreement;
(b) [***], [***], and [***], respectively, for successive 12 month periods if
such termination occurs within the second year of the Agreement; (c) [***],
[***], and [***], respectively, for successive 12 month periods if such
termination occurs within the third year of the Agreement; (d) [***], [***] and
[***], respectively, for successive 12 month periods if such termination occurs
within the fourth year of the Agreement; (e) [***], [***], and [***],
respectively, for successive 12 month periods if such termination occurs within
the fifth year of the Agreement; and (f)[***] for a 36 month period if such
termination occurs after the fifth anniversary of the Agreement.
14.4.3 EXTRAORDINARY NETWORK UPGRADES
For purposes of this Section, Extraordinary Network Upgrades shall (a)
include network upgrades which are generally required to assure continuity or
seamless functionality between the Alliances' Network and the Sprint PCS or
Horizon networks and which will require costs in excess of any offsetting
benefit to be realized by the Alliances (including, but not limited to,
replacing the switching or other network hardware or software from the
Alliance's preferred vendor with the hardware or software of a different vendor
preferred by Horizon or Sprint, changing the air interface protocol from CDMA to
TDMA, GSM or a different protocol, converting to Third Generation ("3G")
technology significantly in advance of the Alliance's time frame to do so, or
introducing a Sprint or Horizon proprietary technology) and (b) exclude network
upgrades necessary to satisfy capacity or volume requirements, implement a
routine system version release on an existing platform, or implement network
upgrades specifically identified and delineated in this Agreement or the
attachments hereto as of the execution date of this Agreement.
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In the event that Horizon terminates this Agreement pursuant to Section
14.3, and the requested network upgrade constitutes an Extraordinary Network
Upgrade, then the provisions set forth in this Section 14.4.3 shall apply upon
termination by Horizon. Specifically, in such event that Horizon terminates this
Agreement in its entirety or with respect to one or more Markets, Horizon may,
with respect to each Market which is subject to such termination, elect to
continue to use the Alliance's Network for up to 36 months after such
termination and to continue to receive the PCS Service at the following
discounts off of all of the pricing terms set forth on Schedule 2 (as in effect
on the date of termination, or if an arbitration proceeding is pending pursuant
to Section 6.6 as of the date of termination, the pricing terms upon which the
discounts apply shall be those determined pursuant to arbitration): (a) [***],
[***], and [***], respectively, for successive 12 month periods if such
termination occurs within the first 5 years of the Agreement; and (b) [***] for
a 36 month period if such termination occurs after the fifth anniversary of the
Agreement. Horizon agrees that, upon request by Alliances, Horizon will provide
the Alliances a reasonable opportunity to propose, before such termination by
Horizon, a commercially reasonable term, volume, or revenue commitment (or
combination thereof) to Horizon to align the costs and benefits of such network
upgrade, and Horizon will use good faith efforts to review the Alliances'
proposal.
14.4.4 ROAMING AND COLLOCATION RIGHTS
In addition to Horizon's rights set forth in Sections 14.4.1, 14.4.2, and
14.4.3, upon termination by Horizon pursuant to Sections 14.1 or 14.3, the
Alliances will, at Horizon's option, grant Horizon the right to roam on the
Alliances' Network at "most favored nation" roaming rates for three years, with
such roaming right to commence when Horizon ceases to use the Alliances'
Network. Horizon shall also have the additional right to collocate on all towers
owned by the Alliances and/or by Virginia RSA6 (if, at that time, the majority
owner or controlling entity of Virginia RSA6 is CFW or one of its Affiliates)
based on commercially reasonable availability of tower space, and for the longer
of three years after the date of such termination or the end of the current term
of this Agreement, the price for collocation shall be set at [***] of the fair
market value of the collocation rights for similar towers. If improvements to
the Alliances' towers are required to support collocation by Horizon as provided
for in this Section, Horizon will fully reimburse the Alliances for all
reasonable costs of making such improvements, and collocation fees shall be set
based on mutually acceptable prices, terms and conditions.
14.5 PHASE-OUT PERIOD
Upon expiration of this Agreement pursuant to Section 3, the Alliances, at
Horizon's request, will continue to provide PCS Service to Horizon in the
terminated Market(s) for a phase-out period of up to 365 days (as determined by
Horizon) after the effective termination date. During the phase-out period, such
PCS Service provided by the Alliances to Horizon in the Markets shall be based
upon commercially reasonable prices, terms, and conditions which are comparable
to those prices, terms, and conditions which the Alliances offer to other
wholesale Alliances' Customers. At the end of the phase-out period, the
Alliances may terminate PCS Service to Horizon at that time without incurring
any liability.
22
14.6 ALLIANCES' RIGHTS
14.6.1 TERMINATION OF SERVICE
Upon termination of this Agreement by Alliances in its entirety or with
respect to a specific Market(s) pursuant to Section 14.1 because of a Horizon
Event of Default or Section 14.2, the Alliances will have no further obligation
to provide PCS Service to Horizon in the terminated Market(s). Notwithstanding
the foregoing, in the event that (a) within fifteen business days of the
termination of service, Sprint PCS cures the outstanding Events of Default
(including, without limitation the payment of all past due amounts under this
Agreement), and (b) all continuing required payments are made when due, the
Alliances agree to reinstitute the PCS Service (upon such cure) for a phase-out
period of 90 days. During such phase-out period, Sprint PCS may elect to assume
and reinstate this Agreement (other than with respect to Horizon's obligations
under Section 15, which will continue to be binding on Horizon), by giving
written notice to the Alliances, which notice will include an undertaking by
Sprint PCS to assume and be bound by the terms and conditions of the Agreement.
14.6.2 RIGHT TO DAMAGES
14.6.2.1 TERMINATION PURSUANT TO SECTION 14.1
In the event that the Alliances make a binding commitment to pay for a
network upgrade or construction which is expressly required by Horizon or Sprint
PCS to be applicable to only a specific Market, and in the event that, within 24
months after such commitment, such Market is terminated pursuant to Section 14.1
because of a Horizon Event of Default, the Alliances will be entitled to
damages, with respect to such Market, from Horizon in an amount equal to (a) the
actual costs incurred by the Alliances in implementing the network upgrade or
construction with respect to such terminated Market, minus (b) the economic
benefits derived by the Alliances with respect to such network upgrade or
construction prior to the termination of this Agreement with respect to such
terminated Market and the reasonably expected economic benefits (in present
value terms) from such network upgrade or construction to be derived after the
termination of this Agreement with respect to the Alliances' Customer base in
such terminated Market.
In the event that the Alliances make a binding commitment to pay for a
network upgrade or construction which is expressly required by Horizon or Sprint
PCS and which affects more than one of the Markets, and in the event that,
within 24 months after such commitment, one or more of such Markets are
terminated pursuant to Section 14.1 because of a Horizon Event of Default, the
Alliances will be entitled to damages from Horizon in an amount equal to (a) the
pro rata actual costs incurred by the Alliances in implementing the network
upgrade or construction with respect to such terminated Market(s), minus (b) the
economic benefits derived by the Alliances with respect to such network upgrades
or construction prior to the termination of this Agreement with respect to such
terminated Market(s) and the reasonably expected economic benefits (in present
value terms) of such network upgrades or construction to be derived after the
termination of this Agreement with respect to the Alliances' Customer base in
such terminated Markets.
23
14.6.2.2 TERMINATION PURSUANT TO SECTION 14.2
In the event that the Alliances make a binding commitment to pay for a
network upgrade or construction which is expressly required by Horizon or Sprint
PCS to be applicable to only a specific Market, and in the event that, within 24
months after such commitment, one or more of such Markets are terminated
pursuant to Section 14.2, the Alliances will be entitled to damages, with
respect to such terminated Markets, from Horizon in an amount equal to (a) the
actual costs incurred by the Alliances in implementing the network upgrade or
construction with respect to the terminated Market, minus (b) the economic
benefits derived by the Alliances with respect to such network upgrade or
construction prior to the termination of this Agreement with respect to the
terminated Market and the reasonably expected economic benefits (in present
value terms) of such network upgrade or construction to be derived after the
termination of this Agreement with respect to the Alliances' Customer base.
In the event that the Alliances make a binding commitment to pay for a
network upgrade or construction which is expressly required by Horizon or Sprint
PCS and which affects more than one of the Markets, and in the event that,
within 24 months after such commitment, a termination occurs pursuant to Section
14.2 with respect to one or more Markets (the "Terminated Markets") and such
Terminated Markets cover (together with all other Markets which have been
terminated pursuant to Sections 14.1 and 14.2) at least 50% of the Markets
covered by this Agreement at the time of the first such termination, the
Alliances will be entitled to damages, with respect to such Terminated Markets,
from Horizon in an amount equal to (a) the pro rata actual costs incurred by the
Alliances in implementing the network upgrades or construction with respect to
such Terminated Markets, minus (b) the economic benefits derived by the
Alliances with respect to such network upgrades or construction prior to the
termination of this Agreement with respect to such Terminated Markets and the
reasonably expected economic benefits (in present value terms) of such network
upgrades or construction to be derived after the termination of this Agreement
with respect to the Alliances' Customer base in such Terminated Markets.
14.7 MITIGATION
Each party agrees to use commercially reasonable efforts to mitigate the
damages which would be payable pursuant to this Section 14, through the
negotiation of cancellation fees or otherwise.
15. RESALE SERVICES TO THE ALLIANCES
15.1
Horizon agrees to provide wholesale PCS services to the Alliances and CFW
and its wholly-owned subsidiaries (excluding Virginia RSA6 Cellular Limited
Partnership) (collectively, the "Intelos Entities"), at the request of an
Intelos Entity, in the Portsmouth, OH BTA and the Parkersburg-Marietta, OH BTA,
and in Gallia and Greenup Counties in the Huntington, WV-Ashland, KY BTA
(excluding the single site in Greenup County that is being transferred to WV
Alliance under the Asset Purchase Agreement, dated as of this date, between WV
24
Alliance and Horizon). The PCS service to be provided by Horizon shall be in
accordance with the requirements of the Management Agreement. The pricing for
such services shall be the same as the standard wholesale price set forth on
Schedule 2, as adjusted from time to time in accordance with Section 6.6 of this
Agreement. The provision of such services shall be on the basis of the terms and
conditions of Sections 5.4, 5.5, 6.2, 6.3, 6.4, 6.5, 7.3, 7.4.4, 7.7 (and
Schedule 15.1 setting forth coverage areas), 7.8, 9, 13, 14, 16, 17 and 18.
Horizon's obligations under this Section 15.1 shall extend for so long as this
Agreement is in effect with respect to any Market.
15.2
Horizon agrees to provide PCS service to the Intelos Entities, at the
request of an Intelos Entity, in the Chillicothe, OH BTA, the Athens, OH BTA,
and the Zanesville-Cambridge, OH BTA. The PCS service to be provided by Horizon
shall be in accordance with the requirements of the Management Agreement. The
pricing for such services shall be set forth on Schedule 2, as adjusted from
time to time in accordance with Section 6.6 of this Agreement. The provision of
such services shall be on the basis of the terms and conditions of Sections 5.4,
5.5, 6.2, 6.3, 6.4, 6.5, 7.3, 9 13, 16, 17 and 18. Horizon's obligations under
this Section 15.2 shall extend for so long as this Agreement is in effect with
respect to any Market.
15.3
Horizon agrees to provide PCS service to Virginia RSA6 Cellular Limited
Partnership ("RSA6"), at the request of RSA6, in the Portsmouth, OH BTA, the
Parkersburg-Marietta, OH BTA, Gallia and Greenup Counties (within the
Huntington, WV-Ashland, KY BTA), the Chillicothe, OH BTA, the Athens, OH BTA,
and the Zanesville-Cambridge, OH BTA. The PCS service to be provided by Horizon
shall be in accordance with the requirements of the Management Agreement. RSA6
agrees to provide analog cellular service to Horizon (excluding Sprint PCS,
another Sprint PCS Manager, a PCS operator who uses the Sprint PCS service
marks, or any other third party), at Horizon's request, in the RSA6 service area
(including the Virginia cities of Harrisonburg, Staunton, and Waynesboro, and
other served communities within the RSA6 service area). The pricing for such
services provided for in this Section 15.3 shall be set forth on Schedule 2, as
adjusted from time to time in accordance with Section 6.6 of this Agreement. The
provision of such services shall be on the basis of the terms and conditions of
Sections 5.4, 5.5, 6.3, 6.3, 6.4, 7.3, 9 and 18.
15.4 NEW MARKETS
Horizon has included the Cumberland, MD BTA, the Logan, WV BTA, and the
Williamson/Pikeville, WV BTA in the Management Agreement. In the event that
Horizon elects to build out any of these new Markets without providing the
Alliances with the opportunity to build the Market and to add it to this
Agreement, Horizon agrees that it will provide PCS services in that Market to
Intelos at the then-current standard wholesale price, and the terms and
conditions, set forth in Section 15.1. Horizon is under no obligation to provide
25
Intelos with the opportunity to build out these new Markets, and Intelos is
under no obligation to agree to build-out these new Markets.
16. CONFIDENTIALITY
16.1 RESTRICTION
Each party agrees that it will not disclose any Proprietary Information
received from the other party except as expressly provided in this Agreement.
Each party agrees to use the Proprietary Information received from the other
party only for the purpose of this Agreement. No other rights, and particularly
licenses, to trademarks, inventions, copyrights, patents, or any other
intellectual property rights are implied or granted under this Agreement or by
the conveying of Proprietary Information between the parties. Proprietary
Information means all information a party discloses to the other party which is
marked "Confidential", "Restricted", "Proprietary", or with some similar writing
indicating the disclosing party considers the disclosed information to be
proprietary. Notwithstanding the foregoing, Horizon shall have the right to make
disclosures to (a) Sprint PCS, to the extent reasonably related to the terms and
conditions of the Management Agreement, (b) the RTFC, to the extent reasonably
related to the debt financing provided to Horizon by the RTFC, and (c) Horizon's
network infrastructure equipment vendor(s) to the extent reasonably related to
compliance with network requirements and debt financing or guarantees provided
by such vendor(s), provided that such persons agree to maintain the
confidentiality of the Proprietary Information in accordance with the terms of
this Agreement. The Alliances shall have the right to make disclosures to (a)
Sprint PCS, (b) the RTFC or other lenders, to the extent reasonably related to
the debt financing provided to the Alliances by the RTFC or other lenders, and
(c) the Alliances' network infrastructure equipment vendor(s), to the extent
reasonably related to compliance with Sprint PCS and Horizon network
requirements and debt financing or guarantees provided by such vendor(s),
provided that such persons agree to maintain the confidentiality of the
Proprietary Information in accordance with the terms of this Agreement.
16.2 CARE
The receiving party must provide the same care to avoid disclosure or
unauthorized use of the Proprietary Information as it provides to protect its
own similar proprietary information. All Proprietary Information must be
retained by the receiving party in a secure place with access limited to only
those of the receiving party's employees or lenders who need to know that
information for purposes of this Agreement and to third parties as the
disclosing party has consented to by prior written approval. Proprietary
Information supplied is not to be reproduced in any form except as required to
accomplish the intent of this Agreement.
16.3 RETURN
All Proprietary Information, unless otherwise specified in writing, must be
returned to the disclosing party or destroyed after the receiving party's need
for it has expired or upon request of the disclosing party, and, in any event,
within 10 days of termination of this Agreement. At the request of the
disclosing party, the receiving party will furnish a certificate of an officer
26
of the receiving party certifying that Proprietary Information not returned to
disclosing party has been destroyed.
16.4 LIMITATION
The parties agree that the term "Proprietary Information" does not include
information which:
(a) has been or may in the future be published or is now or may in the
future be otherwise in the public domain through no fault of the
receiving party;
(b) prior to disclosure pursuant to this Agreement is properly within the
legitimate possession of the receiving party;
(c) subsequent to disclosure pursuant to this Agreement is lawfully
received from a third party having rights in the information without
restriction of the third party's right to disseminate the information
and without notice of any restriction against its further disclosure;
(d) is independently developed by the receiving party through parties who
have not had, either directly or indirectly, access to or knowledge of
Proprietary Information; or
(e) is obligated to be produced under order of a court of competent
jurisdiction or other similar requirement of a governmental agency, so
long as the party required to disclose the information provides the
other party with prior notice of the order or requirement.
16.5 RELIEF
If either party violates or threatens to violate Section 16, the other
party may exercise any right or remedy under this Agreement and any other right
or remedy that it may have (now or hereafter existing) at law, in equity or
under statute. The parties agree that damages for violations of Section 16 may
be difficult to ascertain or inadequate and that if either party violates or
threatens to violate Section 16, the other party may suffer irreparable harm and
therefore may seek injunctive relief in addition to any other right or remedy
under this Agreement and any other right or remedy that it may have (now or
hereafter existing) at law, in equity or under statute. The party that violates
or threatens to violate Section 16 will not raise the defense of an adequate
remedy at law, subject to the limitations set forth in Section 13.2. A party
must not disclose Proprietary Information during the term of this Agreement and
for a period of 3 years from the date of termination of this Agreement.
27
17. ASSIGNMENT
17.1 ASSIGNMENT BY HORIZON
Subject to the remainder of this Section, Horizon may not assign this
Agreement, without the Alliances' prior written consent, which consent may not
be unreasonably withheld or delayed. Without obtaining such consent, Horizon
shall have the right to assign this Agreement to Sprint PCS (a) in accordance
with the terms of the Assignment and Agreement, dated as of this date, between
Horizon and Sprint PCS and (b) upon the expiration or termination of the
Management Agreement. Without obtaining such consent, Horizon may assign this
Agreement to an Affiliate in connection with the transfer of its Private Label
Service business to that Affiliate, provided that Horizon guarantees the
obligations of such Affiliate. Without obtaining such consent, Horizon may
collaterally assign this Agreement as security to the Rural Telephone Finance
Cooperative ("RTFC") and to any other entity which is or becomes a senior
secured lender to Horizon. Without obtaining such consent, Horizon may assign
this Agreement with respect to one or more Markets, to the extent that Horizon
sells all or substantially all of its assets in such Market(s) and if such
purchaser is or becomes a Sprint PCS Manager with respect to such Market(s).
Horizon will give the Alliances 30 days prior written notice prior to any
assignment described in the preceding four sentences.
17.2 ASSIGNMENT BY THE ALLIANCES
The Alliances may not assign this Agreement without Horizon's prior written
consent, which consent may not be unreasonably withheld or delayed. Without
obtaining such consent, the Alliances may assign this Agreement to their
Affiliates or one or more owners of the Alliances. Without obtaining such
consent, the Alliances may collaterally assign this Agreement as security to the
RTFC and to any other entity which is or becomes a senior secured lender to the
Alliances. Without obtaining such consent, the Alliances may assign this
Agreement with respect to one or more Markets to the purchaser of all or
substantially all of their assets in such Market(s); provided, however, that
such exception from obtaining Horizon's consent shall only be applicable to the
first four sales of assets in the Markets. The Alliances will give Horizon 30
days prior written notice prior to any assignment described in the preceding
four sentences.
18. GENERAL PROVISIONS
18.1 NOTICES AND INQUIRIES
Except as otherwise provided, all notices and inquiries required or
permitted to be given by any provision of this Agreement must be in writing and
mailed (certified or registered mail, postage prepaid, return receipt requested)
or sent by hand or overnight courier, (with acknowledgment received by the
courier), or by facsimile (with facsimile acknowledgment) addressed as follows:
If to Horizon: Horizon Personal Communications, Inc.
68 E. Main Street
Chillicothe, OH 45601
Attn: William A. McKell
28
With a copy to: Donald I. Hackney, Jr., Esq.
Arnall Golden & Gregory, LLP
Suite 2800
1201 W. Peachtree Street
Atlanta, GA 30309-3450
With a copy to: Sprint Spectrum, L.P.
4900 Main St., 12th Floor
Kansas City, MO 64112
Attention: Chief Executive Officer
With a copy to: Sprint Spectrum, L.P.
4900 Main St., 12th Floor
Kansas City, MO 64112
Attention: General Counsel
If to the Alliances, Warren Catlett
or any other Intelos CFW Communications Company
Entity or RSA6: 401 Spring Lane, Suite 300
Waynesboro, VA 22980
With a copy to: David M. Carter, Esq.
Hunton & Williams
NationsBank Plaza, Suite 4100
600 Peachtree Street, NE
Atlanta, GA 30308-2216
With a copy to: Sprint Spectrum, L.P.
4900 Main St., 12th Floor
Kansas City, MO 64112
Attention: Chief Executive Officer
With a copy to: Sprint Spectrum, L.P.
4900 Main St., 12th Floor
Kansas City, MO 64112
Attention: General Counsel
Any party may from time to time specify a different address by notice to
the other party. Any notice will be deemed to be delivered, given, and/or
received for all purposes as of the date so delivered.
29
18.2 CONSTRUCTION
The definitions in this Agreement apply equally to both the singular and
plural forms of the terms defined. Whenever the context requires, any pronoun
includes the corresponding masculine, feminine and neuter forms. The words
"include", "includes" and "including" are deemed to be followed by the phrase
"without limitation". Unless the context otherwise requires, any references to
any agreement, schedule or exhibit or to any other instrument or statute or
regulation are to it as amended and supplemented from time to time (and, in the
case of a statute or regulation, to any corresponding provisions of successor
statutes or regulations). Unless this Agreement specifically refers to
"business" days, any reference in this Agreement to a "day" or number of "days"
is a reference to a calendar day or number of calendar days. If any action or
notice is to be taken or given on or by a particular calendar day, and that
calendar day is not a business day for the Alliances or Horizon then the action
or notice will be deferred until, or may be taken or given on, the next business
day. This Agreement will be construed simply according to its fair meaning and
not strictly for or against any party. No rule of construction requiring
interpretation against the draftsperson will apply in the interpretation of this
Agreement.
18.3 TIME
Time is of the essence with respect to this Agreement.
18.4 INDEPENDENT CONTRACTORS
The parties do not intend to create any agency, partnership, joint venture
or other profit-sharing arrangement, landlord-tenant, or lessor-lessee
relationship, or any relationship other than seller-buyer. Neither party will
represent itself as an agent or representative of the other, and neither party
shall have the right to contractually bind the other. Horizon will not represent
itself as a purchaser of PCS Service in any way not specifically provided for
herein. The staff employed or contracted for by the employing party to perform
services in connection with this Agreement are not employees or agents of the
other party and each party assumes full responsibility and liability for their
acts and omissions, including compliance by its staff with this Agreement,
applicable federal, state and local laws, regulations, and judicial or
regulatory orders, and relevant industry standards. All staff will be employed
or contracted for at the employing party's sole expense and the employing party
will be solely responsible for any and all employment benefits and withholdings
issues, including, workers' compensation, disability benefits, unemployment
insurance or withholding income taxes and social security.
18.5 SURVIVAL
The provisions of Sections 3.3, 9, 10, 11, 12, 13, 14, 15 and 16 will
survive the termination of this Agreement, in addition to any other provision
that by its content is intended to survive termination of this Agreement, such
as most provisions during the phase-out period.
30
18.6 HEADINGS
The article and other headings contained in this Agreement are for
reference purposes only and are not intended to describe, interpret, define, or
limit the scope, extent, or intent of this Agreement or any provision of this
Agreement.
18.7 SEVERABILITY
Every provision of this Agreement is intended to be severable. If any term
or provision of this Agreement is illegal, invalid or unenforceable for any
reason whatsoever, that term or provision will be enforced to the maximum extent
permissible so as to effect the intent of the parties, and the illegality,
invalidity or unenforceability will not affect the validity or legality of the
remainder of this Agreement. If necessary to effect the intent of the parties,
the parties will negotiate in good faith to amend this Agreement to replace the
unenforceable language with enforceable language which as closely as possible
reflects the intent.
18.8 GOVERNING LAW
This Agreement will be governed by and construed in accordance with the
laws of the State of Georgia without giving effect to choice of law rules.
18.9 COUNTERPART EXECUTION
This Agreement may be executed in any number of counterparts with the same
effect as if each party had signed the same document. All counterparts will be
construed together and will constitute one agreement.
18.10 ENTIRE AGREEMENT; AMENDMENTS
This Agreement, including the Schedules and Exhibits, sets forth the entire
agreement and understanding between the parties as to the subject matters
covered therein and supersedes all prior agreements, oral or written, and other
communications between the parties relating to the subject matter of this
Agreement, including without limitation the Interim Agreement. Except as
otherwise provided in this Agreement, no amendment or modification of this
Agreement will be valid or binding upon the parties unless made in writing and
signed by the duly authorized representatives of both parties.
18.11 PARTIES IN INTEREST; LIMITATION ON RIGHTS OF OTHERS
Except as otherwise provided in this Agreement, the terms of this Agreement
will be binding upon and inure to the benefit of the parties hereto and their
permitted successors and assigns. Nothing in this Agreement, whether express or
implied, will be construed to give any person other than the parties any legal
or equitable right, remedy or claim under or in respect of this Agreement or any
covenants, conditions or provisions contained in this Agreement.
31
18.12 WAIVERS; REMEDIES
The observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or prospectively)
by the party entitled to enforce the term, but any waiver is effective only if
in a writing signed by the party against which the waiver is to be asserted.
Except as otherwise provided in this Agreement, no failure or delay of any party
in exercising any right under this Agreement will operate as a waiver thereof,
nor will any single or partial exercise of any right, or any abandonment or
discontinuance of steps to enforce the right, preclude any other or further
exercise thereof or the exercise of any other right.
18.13 FORCE MAJEURE
If the performance of this Agreement is interfered with by any circumstance
beyond the reasonable control of the party affected, including the failure of
any governmental authority to grant any consent, approval, waiver, or
authorization or any delay on the part of any governmental authority in granting
any consent, approval, waiver or authorization, manufacturer or equipment vendor
delays or deficiencies (including ability to process correctly calendar
date-related data), delays in repair or maintenance of cell sites due to
restricted access by third parties, delays or barriers to construction or
coverage resulting from local zoning restrictions or frequency coordination
issues with incumbent microwave users, acts of God, such as fire, flood,
earthquake or other natural cause, terrorist events, riots, insurrections, war
or national emergency, strikes, boycotts, lockouts or other labor difficulties,
the party affected by the force majeure is excused on a day-by-day basis to the
extent of the interference; if the party notifies the other party as soon as
practicable of the nature and expected duration of the claimed force majeure,
uses all commercially reasonable efforts to avoid or remove the causes of
32
nonperformance and resumes performance promptly after the causes have been
removed.
18.14 DISCLOSURE
The parties mutually agree to the content of the press release attached
hereto as Exhibit A. All other media releases and public announcements or public
disclosures initiated by either party relating to this Agreement, its subject
matter or the purpose of this Agreement are to be coordinated with and consented
to by the other party in writing, which consent shall not be unreasonably
withheld, prior to the release thereof. Unless the parties expressly agree
otherwise in writing, media releases and public announcements or public
disclosures contemplated in this Section 18.14 (i) shall be provided only to the
financial, investor, and shareholder community, wire services, and the
telecommunications trade press; and (ii) shall not be provided to newspapers,
radio, or television having general distribution or coverage in the Markets,
excluding the local newspapers serving Augusta County, VA (Staunton-Waynesboro
area), Rockingham County, VA (Harrisonburg area), and Allegheny County, VA
(Clifton Forge-Covington area), and, in any event, shall not be disseminated for
purposes of marketing, advertising and solicitation efforts directed to existing
or potential Horizon End Users or Alliances' Customers. Notwithstanding the
foregoing, either party may disseminate the content of previously approved and
released media releases and public announcements or public disclosures as part
of ongoing shareholder and Securities and Exchange Commission communications,
without obtaining additional consent from the other party.
18.15 COMPLIANCE WITH LAWS
Each of Horizon and the Alliances will comply with all applicable federal,
state, county and local laws, rules, regulations and orders that apply to it,
its operations and facilities.
18.16 ARBITRATION
All disputes arising under this Agreement (other than claims in equity)
shall be resolved by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. Arbitration shall be by a single
arbitrator experienced in the matters at issue and selected by Horizon and the
Alliances in accordance with the Commercial Arbitration Rules of the American
Arbitration Association. The arbitration shall be held in such place in Atlanta,
Georgia as may be specified by the arbitrator (or any place agreed to by
Horizon, the Alliances and the arbitrator). The decision of the arbitrator shall
be final and binding as to any matters submitted under this Agreement; provided,
however, if necessary, such decision may be enforced by either Horizon or the
Alliances in any court of record having jurisdiction over the subject matter or
over any of the parties of this Agreement. All costs and expenses incurred in
connection with any such arbitration proceeding (including reasonable attorneys
fees) shall be borne by the party against which the decision is rendered, or, if
no decision is rendered, such costs and expenses shall be borne equally by
Horizon and the Alliances. If the arbitrator's decision is a compromise, the
determination of which party or parties bears the costs and expenses incurred in
connection with any such arbitration proceeding shall be made by the arbitrator
on the basis of the arbitrator's assessment of the relative merits of the
parties' positions.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
33
SIGNATURES TO NETWORK SERVICES AGREEMENT
This Agreement is made as of the date first written above.
WEST VIRGINIA PCS HORIZON PERSONAL
ALLIANCE, LC COMMUNICATIONS, INC.
By: /s/ James S. Quarforth By:_________________________________
_____________________________
Name: James S. Quarforth Name:_______________________________
Its: Chairman Its: _______________________________
VIRGINIA PCS ALLIANCE, LC
By: /s/ James S. Quarforth
____________________________
Name: James S. Quarforth
Its: Chairman
CFW Communications Company executes Virginia RSA6 Cellular Limited
Agreement solely for the purposes Partnership executes this Agreement
of agreeing to the provisions of solely for the purposes of agreeing
Sections 15.1 and 15.2: to the provisions of Section 15.3:
CFW COMMUNICATIONS COMPANY VIRGINIA RSA6 CELLULAR LIMITED
PARTNERSHIP
By: CFW Communications Company as
General Partner
By: /s/ James S. Quarforth By: /s/ Carl A. Rosberg
----------------------------- ---------------------------------
Name: James S. Quarforth Name: Carl A. Rosberg
Its: Chairman Its:
34
SIGNATURES TO NETWORK SERVICES AGREEMENT
This Agreement is made as of the date first written above.
WEST VIRGINIA PCS HORIZON PERSONAL
ALLIANCE, LC COMMUNICATIONS, INC.
By: /s/ William A. McKell
By: ____________________________ ----------------------------------
Name:___________________________ Name: William A. McKell
Its:____________________________ Its: President
VIRGINIA PCS ALLIANCE, LC
By: ____________________________
Name:___________________________
Its:____________________________
CFW Communications Company executes Virginia RSA6 Cellular Limited
Agreement solely for the purposes Partnership executes this Agreement
of agreeing to the provisions of solely for the purposes of agreeing
Sections 15.1 and 15.2: to the provisions of Section 15.3:
CFW COMMUNICATIONS COMPANY VIRGINIA RSA6 CELLULAR LIMITED
PARTNERSHIP
By: CFW Communications Company as
General Partner
By: ____________________________ By:______________________________
Name:___________________________ Name: William A. McKell
Its:____________________________ Its: President
35
Schedule 1
MARKETS
-------
Danville, VA VA Alliance September 1, 1999
Lynchburg, VA VA Alliance September 1, 1999
Martinsville, VA VA Alliance September 1, 1999
Roanoke, VA VA Alliance September 1, 1999
Staunton-Waynesboro, VA VA Alliance September 1, 1999
Charlottesville, VA VA Alliance September 1, 1999
Bluefield, WV WV Alliance
Beckley, WV WV Alliance
Charleston, WV WV Alliance September 1, 1999
Huntington, WV-Ashland, KY WV Alliance September 1, 1999
Morgantown, WV WV Alliance September 1, 1999
Clarksburg/Elkins, WV WV Alliance September 1, 1999
Fairmont, WV WV Alliance September 1, 1999
36
[***] - CONFIDENTIAL TREATMENT REQUESTED
Schedule 2
PCS SERVICES AND PRICING
1. STANDARD WHOLESALE PRICE FOR HORIZON CUSTOMERS. Subject to Section 6,
the standard wholesale rate for PCS services provided by the Alliances to
Horizon for Horizon customers will be [***] per minute.
2. PRICE FOR CUSTOMERS OF SPRINT PCS AND ITS AFFILIATES. Subject to Section
6, the rate for PCS services provided by the Alliances to Horizon for customers
of Sprint PCS, customers of a Sprint PCS Manager and customers of a PCS operator
who uses the Sprint PCS service marks as its primary or secondary service marks
throughout its operations will be [***] per minute.
3. PRICE FOR SECTION 15.1 SERVICES. Subject to Section 6, the price for the
wholesale PCS services provided by Horizon pursuant to Section 15.1
will be [***] per minute.
4. PRICE FOR SECTION 15.2 SERVICES. Subject to Section 6, the price for the
PCS services provided by Horizon pursuant to Section 15.2 will be [***] per
minute, and the U. S. domestic long distance price will be [***] per minute.
5. PRICE FOR SECTION 15.3 SERVICES. Subject to Section 6, the price for PCS
services provided by Horizon, and the price for analog cellular service provided
by RSA6, pursuant to Section 15.3, will be [***] per minute. In each case, the
U.S. domestic long distance price will be [***] per minute.
1
Schedule 6.7
PRICING FOR ANCILLARY NETWORK PLATFORMS
On the date of the execution of this Agreement, there are no ancillary
network platforms which are a part of this Agreement.
2
Schedule 7.4.1
REQUIREMENTS FOR NETWORK OPERATION AND PERFORMANCE
The Alliances will operate a network that will enable Horizon to provide
seamless interoperability with the Sprint PCS Network and uniform and consistent
quality of product and service offerings. Therefore, the operation and
performance of the Service Area is to be in conformance with the standards and
requirements of Sprint PCS ("Technical Standards"). The Technical Standards are
defined and detailed in certain design, construction, and operational standards,
specifications and requirements adopted by Sprint PCS (the "Standards
Documents") as set forth in the following documents:
1. Sprint Telecommunications Venture Nationwide PCS Network CDMA RF
Design Specifications. (Hereinafter referred to as "Rev 8")
2. Sprint Spectrum Engineering & Operations standards. (Hereinafter
referred to as "SSEO")
3. LATA Switching System Generic Requirements (from Bellcore).
(Hereinafter referred to as the "LSSGR")
4. Sprint PCS Standard Construction Documents for Cell Sites-Books 1 to 4
(dated June, 1997). (Hereinafter referred to as "Cell Site
Construction Documents")
5. Switch Building-Switch Center Facilities Guidelines (Dated December
31, 1996). (Hereinafter referred to as "Switch Site Construction
Documents")
6. Approved Infrastructure Equipment and Vendor List
7. Approved Subscriber Equipment and Vendor List
In addition to complying with the Technical Standards for design, construction
and operation of the network, including but not limited to transport,
intelligent network, switching hardware/software, operations support systems and
signaling protocols, Horizon and the Alliances agree to comply with industry and
regulatory standards and requirements for design, operation and performance of
the network, the approval and use of subscriber equipment and microwave
relocation. Furthermore, the Alliances must comply with FCC and FAA requirements
and compliance, including but not limited to items such as tower height, tower
lighting, and tower monitoring. The Alliances must comply with procedures and
processes established by Sprint PCS with respect to FCC and FAA requirements and
compliance regarding the Facilities, as set forth on Schedule 7.4.2.
3
[***] - CONFIDENTIAL TREATMENT REQUESTED
Schedule 7.4.2
TECHNICAL STANDARDS AND REQUIREMENTS
- -------------------------------------------- --------------------------------------- -------------------------------
STANDARD/MINIMUM DEFINITION/SOURCE INITIAL RECURRING
REQUIREMENT DOCUMENT CERTIFICATION VERIFICATION
- -------------------------------------------- --------------------------------------- -------------------------------
(Note #1) (Note #1)
RF-ENGINEERING:
1 Area Availability -[***] Rev. 8 (Note #2) x x
2 Grade of Service/Sector Revv. 8 x x
Blocking rate [***]
(Using the Grade of Service traffic model, the ratio of blocked call attempts to
total call attempts during a typical Busy Hour (BH) on a per sector basis shall
be less than [***] (Erlang B or approved alternate model)) Note #4
3 FER [***] (within area of Rev. 8 x x
[***] availability)
4 Dropped Call lesser than [***] Rev. 8 x x
(The percentage of Dropped Calls will be [***] or less initially measured
through call sampling during Optimization and post-launch as measured through
Service Measurement captured statistics. In the initial Drive Test Optimization
process, the minimum numb
5 Total Call Origination/ Rev. 8 x x
Termination Failures [***]
(Call origination and termination attempts are defined as being successful when
a "probe Acknowledgement" message is received by the subscriber unit as logged
on the RF Data Collection Unit. Call Origination/Termination failures are
generated when the Prob
6 Loading/Pole Pt. Rev. 8 x x
Objective Range - [***]
4
[***]- CONFIDENTIAL TREATMENT REQUESTED
7 Coverage per morphology Rev. 8 x x
(Bldg penetration loss)
o Dense Urban
o Urban
o Rural
o Highway
8 Alternative In-Building Solutions SSEO 3.015.13.004, x x
SSEO 3.014.06.001 &
SSEO 3.003.06.004
9 Additional RF Solutions x x
o Second Carrier Design/ SSEO 2.003.06.002 &
Implementation SSEO 3.003.13.007
o Six Sector Deployment SSEO 3.003.13.007 &
SSEO 3.003.13.005
10 Interference SSEO 3.003.06.003 x x
11 BTS/CBSC Maintenance SSEO 2.003.03.004 & x x
Procedures SSEO 2.003.03.005
SWITCH ENGINEERING:
1 Switch Uptime - [***] Bellcore's LATA x x
Switching System
Generic Req.
(LSSGR)
5
[***] CONFIDENTIAL TREATMENT REQUESTED
2 Planned/unplanned Down-time LSSGR (Note #3) x x
Planned time for entire switching
system is unacceptable. New software
loads or system reconfiguration
should be completed without
complete interruption of service.
3 Tandem traffic = [***] Neal Wilkinson/Erlang B x x
End Office = [***] tables and LSSGR
4 Switch maintenance Procedures x
o Lucent SSEO 2.002.03.008
o Nortel SSEO 2.002.03.007
o Network Operations SSEO 2.000.03.001
o Motorola Per SSEO when available
5 Back UP Procedure: x
o SPCS Nortel MSC SSEO 2.002.03.009
o SPCS Lucent MSC SSEO 2.002.03.010
o SPCS Motorola MSC Per SSEO when available
o SPCS Office Lucent MSC SSEO 2.002.09.002
o SPCS Office Nortel MSC SSEO 2.002.09.003
o SPCS Office Motorola MSC Per SSEO when available
6 Recommended Spares SPCS Guidelines x x
7 Emergency Procedures x x
o Contact List Updated when implemented
o General Disaster Recovery SSEO 2.000.04.015
o Emerg. Recovery Procd. Nortel SSEO 2.002.04.002
o Emerg. Recovery Procd. Lucent SSEO 2.002.04.003
o Emerg. Recovery Procd. Motorola Per SSEO when available
o OSSC: Outage/Event Notify SSEO 2.000.04.006
8 Alarms: x x
6
[***] CONFIDENTIAL TREATMENT REQUESTED
o NOCC - Lucent Alarms SSEO 2.000.10.001
o NOCC - Nortel Alarms SSEO 2.000.10.003
o NOCC - Motorola Alarms Per SSEO when available
9 Security: x x
o Elec. Surveillance SSEO 2.000.05.003
o Enhanced 911 SSEO 3.000.09.001
o Network Security SSEO 2.000.05.004
10 Translations: x x
o Lucent Standards SSEO 0.002.09.001
o Nortel Standards SSEO 0.002.09.002
o Switch recorded Announcement SSEO 0.002.09.003
o Motorola Per SSEO when available
11 Local Number Portability SSEO 1.027.07.007 x x
NOTE: Sprint PCS may establish a two switch supplier operating system and
reserves the right to require the change-out of any current or future switch
supplier (ie, Motorola) at expense of affiliate for affiliates' markets.
TRANSPORT-ENGINEERING:
1 Transmission: SSEO 3.000.12.001 x x
o Loss = [***] "
o ERL = [***] dB or greater "
o Backhaul delay = [***] "
o Differential delay = [***] "
o Line Coding = [***] "
2 Microwave: SSEO 3.012.09.001 x x
o Availability = 99.999%/link
o Protection (hot stand-by) for links of 5 or more
cell sites
7
3 ATM Requirements SSEO 2.016.06.001 x x
5 Digital Synchronization: SSEO 3.015.09.001 x x
o Each switch site will have GPS/BITS system installed
ELECTRICAL - ENGINEERING:
1 Backup Power:
x x
o Cell Sites
- fixed generator-aviation lights SSEO 2.004.03.001
- 4 hrs minimum battery SSEO 3.004.12.001
- Mobile generators SSEO 3.004.12.001
o Switch Sites x x
- fixed generator for total MSC load
- 2 hrs minimum battery
2 Switch DP Power Plant SSEO 3.004.06.002 x x
3 Grounding x x
o Cell Sites SSEO 3.018.02.001 &
SSEO 3.018.02.002
o Switch Sites SSEI 3.018.02.003
4 Surge Protector (TVSS) x x
o Cell Sites SSEO 2.003.003.001
o Switch Sites SSEO 2.002.03.005
5 Preventive Maintenance x x
o Cell Sites SSEO 2.004.03.002 &
SSEO 2.018.03.002
8
o Switch Sites SSEO 2.004.03.003 &
SSEO 2.018.03.001
INTELLIGENT NETWORK (IN) - ENGINEERING:
1 SS7 Interconnection x x
o Switch Sites SSEO 3.008.06.001
SSEO 3.008.10.001
SSEO 3.008.10.002
o Translations SSEO 0.008.09.001
2 IN Deployment SSEO 3.000.06.006 x x
3 Performance for SS-7 and IN Standards Committee x x
Platforms (SCP, SSP, SN) T1-Telecommunications
4 Performance for AIN, Voice Mail, Network Operations Forum x x
IWF, Short message Service, Data SSEO 3.017.12.007,
SSEO 3.030.12.009,
SSEO 3.030.12.001,
SSEO 3.030.12.005,
SSEO 3.030.12.007 &
SSEO 3.030.12.010
OPERATIONAL SUPPORT SYSTEMS:
1 Operator Services Performance Same as Sprint Spectrum Internal Standards
o Answer time
Provided via Sprint Spectrum
9
2 Directory Assistance Same as Sprint Spectrum Internal Standards
o Answer time
Provided via Sprint Spectrum
SUBSCRIBER EQUIPMENT:
1 Meet or exceed tests and o FCC Certification x x
o Handsets specifications: o CDMA Dev, Group Cert. (CDG)
o Vendor Design Verify (DVT)
o Sprint Spectrum Design Verify Test
o CDG Stage 2
o CDG Stage 3
o Vendor Qual. Verify Test
o Vendor Manuf. Test
o Vendor Accessory Test
o Sprint Spectrum Accessory Test
o Sprint Spectrum User interface test
o Feature Testing SPCS
o Vendor Software Assurance
o Sprint Spectrum field testing -
CPE tech Planning and Dev. Group
MICROWAVE RELOCATION:
1 Ensure protection of 2 GHz CFR47, Part 24.237; TIA x x
Microwave Services by Prior Bulletin 10-F; and CFR47,
coordination Notification Part 101.69 Through Part 101.81
process (PCN)
2 No potential interference levels TIA Technical Systems x x
of PCS base or mobile stations into Bulletin 10-F
2 GHz microwave incumbent user system
3 Predicted PCS-to-microwave CFR47, Part 101.69 x x
interference into GHz incumbent through Part 101.81
systems may require relocation of
the incumbent to new bands if no
spectrum sharing potential exists.
10
4 Definitive microwave relocation SSEO 2.003.06.002 x x
agreements 30-60 days in SSEO 2.012.10.001 x x
advance of Network Ready Dates
CONSTRUCTION STANDARDS:
o Cell Sites SSLP Standard Construction x x
Documents - Book 1-4
(dated June, 1997)
o Switch Building Building - Switch Center x x
Guidelines - Ground UP Construction
of Precast Concrete Buildings
(dated December 31, 1996)
NATIONAL OPERATIONS CONTROL CENTER (NOCC):
1 24x7 Fault Management Surveillance Same as Sprint Spectrum
network elements, trunks, & Services. Internal Standards
Includes Switches, cells, AIN platforms,
SS7, IXC, LEC, OS, DA, 911 &
environemntal conditions
o Provided via Sprint Spectrum
2 24x7 Trouble Management for customer Same as Sprint Spectrum Internal x x
delivered service troubles Standards
o Provided via Sprint Spectrum
3 FAA Compliance Same as Sprint Spectrum Internal x x
Standards
o Provided via Sprint Spectrum
11
ROAMING:
1 Network datafill procedures, SSEO 2.029.03.001, x x
IS-41 implementation, manual SSEO 3.029.12.001,
plan, inbound/outbound trouble SSEO 2.029.04.002, &
reporting procedures, etc. SSEO 2.029.04.001
Note #1:
o Initial Certification - A two phase procedure performed by Sprint Spectrum
to ensure the system is Network Ready
1 Review and Verify that system design and construction meets Sprint
Spectrum's technical standards and requirements.
2 Successfully completes the Operational Acceptance Checklist (OPAC)
o Recurring Verification - A Sprint Spectrum OPAC checklist shall be
completed under methods and procedures adopted by Sprint Spectrum a minimum
of every 6 months after Network Ready date.
Note #2:
o Revision 8 - National PCS Network CDMA RF Design Specifications (Rev. 8)
Note #3:
o Lata Switching System Generic Requirements (BellCore)
Note #4:
o Standard definitions are more current and take precedence over definitions
in Rev. 8.
12
Schedule 7.4.6
ACCESS TO PERFORMANCE DATA
PERFORMANCE DATA REPORTING REQUIREMENTS
1. Initially, the Alliances will allow Horizon real time access to a secure
server within the Alliances' network. Horizon personnel will have the ability to
enter the server, and extract required report information with minimum Alliances
personnel intervention. This server must provide access to all data necessary to
produce reports including, but not limited to, RF performance, trunk
utilization, switching performance and system outages. The Application Processor
or the OMC-R may be used to provide this function or a separate server may be
utilized. During the first six (6) months of this agreement, raw data from the
OMC-Rs and the switch(es) will be transferred to this server as frequently as
the Alliances deem practical, but no less frequently than every 24 hours with
the previous day's data available no later than 8:00 a.m. EST the following day.
2. Real time access to performance data will be required within six months of
the signing of the Network Services Agreement. At that time Horizon is to have
the same access to performance data in the Service Area as it has to its own
performance data. In addition to the daily data access described in (1) above,
Horizon will be provided a user account with "Super Cell User" (scuser)
read-only permissions and login, through which the desired reports will be
remotely produced as required. Horizon will, at that time, have the ability to
enter the server and extract required report information without Alliances
personnel intervention.
13
Schedule 7.7
COVERAGE AREA
PHASE I CONSISTS OF: BTA 073 Charleston WV
BTA 197 Huntington WV/Ashland KY
The Central West Virginia corridor includes BTA 073 - CHARLESTON WV AND BTA 197
- - HUNTINGTON WV/ASHLAND KY. The coverage area for this corridor extends along
Interstate 64 from Kentucky Exit 185 east to West Virginia Exit 85 including the
cities of Catlettsburg, Huntington, Chesapeake, Barboursville, Hurricane, Nitro,
South Charleston and Charleston. Service extends northwest of Huntington along
the Ohio River to include the cities of Ashland and Ironton. Connecting service
is provided along US Route 60 from Ashland to I-64. This market is scheduled to
be fully operational on the date of signing and will cover an estimated 468,437
POPs or 54% of the combined population of the BTAs.
PHASE 2 CONSISTS OF: BTA 075 Charlottesville VA
BTA 082 Clarksburg/Elkins WV
BTA 104 Danville VA
BTA 137 Fairmont WV
BTA 266 Lynchburg VA
BTA 284 Martinsville VA
BTA 306 Morgantown WV
BTA 376 Roanoke VA
BTA 430 Staunton/Waynesboro VA
The Shenandoah Valley corridor includes BTA 075 - CHARLOTTESVILLE VA, BTA 266 -
LYNCHBURG VA, BTA 376 - ROANOKE VA, BTA 430 - STAUNTON/WAYNESBORO VA. The
14
coverage area for Horizon's Shenandoah Valley region extends from the northern
boundary of the Staunton/Waynesboro BTA on Interstate 81 southwest to Exit 128
including the cities of Staunton, Lexington and Roanoke. Coverage extends east
on Interstate 64, with temporary minor breaks due to zoning challenges, from the
intersection with I-81 to the eastern boundary of the Charlottesville BTA
including the cities of Waynesboro and Charlottesville. Coverage extends east on
US Route 460 from Roanoke to the eastern boundary of Campbell County including
the city of Lynchburg. Coverage also extends along US Route 29 connecting
Charlottesville with Lynchburg. This market is scheduled to be fully operational
on September 1, 1999 and will cover an estimated 722,124 POPs or 66% of the
combined population of the BTAs. The Alliances agree to use their reasonable
efforts to provide Service at the Greenbriar Resort by October 15, 1999.
The coverage area for BTA 104 - DANVILLE VA extends from Blairs, VA south along
US Route 29 to Ruffin, NC, including the city of Danville, VA. Coverage also
extends westward along US Route 58 from Danville to BTA boundary. This market is
scheduled to be fully operational on September 1, 1999 and will cover an
estimated 86,701 POPs or 53% of the population of the BTA.
The coverage area for BTA 284 - MARTINSVILLE VA extends from the northern
boundary of Henry County south along US Route 220 to southern boundary of Henry
County, including the city of Martinsville, VA. Coverage also extends eastward
along US Route 58 from Martinsville to BTA boundary. This market is scheduled to
be fully operational on September 1, 1999 and will cover an estimated 56,241
POPs or 641/o of the population of the BTA.
The Northern West Virginia corridor includes BTA 082 - CLARKSBURG/ELKINS WV, BTA
137 - FAIRMONT WV, AND BTA 306 - MORGANTOWN WV. The coverage area for this
corridor extends along Interstate 79 from slightly south of Clarksburg, West
Virginia, to north of Morgantown, West Virginia including the cities of
Clarksburg, Bridgeport, Fairmont and Morgantown and a connecting portion of I-68
northeast of Morgantown to the Cheat Lake residential/resort area. This market
is scheduled to be fully operational on September 1, 1999 and will cover an
estimated 179,583 POPs or 50% of the combined population of the BTAs.
15
[***] - CONFIDENTIAL TREATMENT REQUESTED
PHASE 3:
New Markets Include: BTA 035 Beckley WV
The coverage area for BTA 035 - BECKLEY WV, will extend from Exit 54 south along
Interstate 77 to Exit 28, including the city of Beckley, WV. Coverage will also
extend eastward along Interstate 64 from I-77 split to Exit 125. This market is
scheduled to be fully operational on [***] and will cover an estimated [***] or
[***] of the population of the BTA.
Coverage Extensions:
The Shenandoah Valley - coverage in BTA 376 - ROANOKE VA will be extended south
along US Route 220 to connect with coverage in BTA 284 - MARTINSVILLE VA. This
expanded service is expected to be implemented by [***].
The Northern West Virginia corridor - coverage in BTA 082 - CLARKSBURG/ELKINS WV
will be extended south along Interstate 79 to Exit 96 and then east along US
Route 33 to include full coverage of the cities of Buckbannon and Weston.
Coverage in BTA 306 - MORGANTOWN WV will be extended north along Interstate 79
to the BTA boundary. This expanded service is expected to be implemented by
[***].
The Central West Virginia corridor - coverage in BTA 073 - CHARLESTON WV will be
extended along US Route 35 between I-64 and the Ohio River including the city of
Buffalo and will be extended southward along Interstate 77 to Exit 79 including
the city of Montgomery. This expanded service is expected to be implemented by
[***].
16
[***] - CONFIDENTIAL TREATMENT REQUESTED
PHASE 4:
New Markets Include: BTA 048 Bluefield WV
The coverage area for BTA 048 - BLUEFIELD, WV will extend south along Interstate
77 from northern BTA boundary to the north end of the tunnel immediately north
of Virginia Exit 66. Coverage also extends along US Route 460 from I-77 to
Bluefield, WV, including full coverage of the cities of Bluefield and Princeton.
This market is scheduled to be fully operational on [***] and will cover an
estimated [***] or [***] of the population of the BTA.
Coverage Extensions:
The Shenandoah Valley - coverage in BTA 376 - ROANOKE VA will be extended
southwest along Interstate 81 to the BTA boundary and north on Interstate 77 to
meet connecting coverage with BTA 048 - Bluefield WV, provided that Horizon is
providing facilities-based service in BTA 229 - Kingsport/Johnson City/Bristol.
This expanded service is expected to be implemented by [***].
Coverage in BTA 035 - BECKLEY WV will be extended south along Interstate 77 to
the BTA boundary, east along Interstate 64 from I-77 split to Exit 139 and
northeast along US Route 19 from I-77 to the New River Gorge bridge. This
expanded service is expected to be implemented by [***].
17
Schedule 13.1
INDEMNIFICATION PROCEDURES
Notice
------
The Indemnitee will give the Indemnitor written notice within 30 days of
becoming aware that any formal or informal claim, demand, or request for
indemnified losses under Section 13.1 will be or has been made against the
Indemnitee, either individually or with others, (the "Indemnification Claim").
Defense by Indemnitor
---------------------
If, within 30 days after the giving of notice, the Indemnitee receives
written notice from the Indemnitor stating that the Indemnitor intends to
dispute or defend against the Indemnification Claim, the Indemnitor will have
the right to select counsel of its choice and to dispute or defend against the
claim, demand, liability, suit, action or proceeding, at its expense. The
Indemnitee will fully cooperate with the Indemnitor in the dispute or defense so
long as the Indemnitor is conducting the dispute or defense diligently and in
good faith; but the Indemnitor will not be permitted to settle the
Indemnification Claim without the prior written approval of the Indemnitee,
which approval will not be unreasonably delayed or withheld. Even though the
Indemnitor selects counsel of its choice, the Indemnitee has the right to
additional representation by counsel of its choice to participate in the defense
at Indemnitee's sole cost and expense.
Defense by Indemnitee
---------------------
If (a) no notice of intent to dispute or defend the Indemnification Claim
is received by Indemnitee within the 30-day period, or (b) diligent and good
faith defense is not being, or ceases to be, conducted, by the Indemnitor, the
Indemnitee has the right to dispute and defend against the Indemnification Claim
at the sole reasonable cost and expense of Indemnitor, but the Indemnitee will
not permitted to settle the Indemnification Claim without the prior written
approval of the Indemnitor, which approval will not be unreasonably withheld.
18
Schedule 15.1
COVERAGE AREA
BTA 342 Parkersburg WV/Marietta OH
BTA 359 Portsmouth OH
The coverage area for BTA 342 - PARKERSBURG WV/MARIETTA OH extends from Blairs,
south along Interstate 77 from milepost 4 in Ohio, south to milepost 168,
including the cities of Marietta and Parkersburg. This market is scheduled to be
fully operational on September 1, 1999 and will cover an estimated 120,000 POPs
or 66% of the population of the BTA.
The coverage area for BTA 359 - PORTSMOUTH OH extends from the northern BTA
boundary south along US Route 23 to the southeastern BTA boundary including the
city of Portsmouth, OH. This market is scheduled to be fully operational on
September 1, 1999 and will cover an estimated 70,000 POPs or 75% of the
population of the BTA.
The estimated visual representation for these coverage areas is included on the
map in Schedule 7.7.