EXHIBIT 10.14
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
This Settlement Agreement and Mutual Release (this "AGREEMENT") is
entered into as of March 16, 2005, by and among SPRINT SPECTRUM L.P., a Delaware
limited partnership, SPRINTCOM, INC., a Kansas corporation, WIRELESSCO, L.P., a
Delaware limited partnership, PHILLIECO, L.P., a Delaware limited partnership,
APC PCS, LLC, a Delaware limited liability company, SPRINT COMMUNICATIONS
COMPANY L.P., a Delaware limited partnership, (collectively, the "SPRINT
PARTIES,"), HORIZON PERSONAL COMMUNICATIONS, INC., an Ohio corporation
("HORIZON"), BRIGHT PERSONAL COMMUNICATIONS SERVICES, LLC, an Ohio limited
liability company ("BRIGHT") and HORIZON PCS, INC., a Delaware corporation
(together with Horizon and Bright, the "HORIZON PARTIES"). The Horizon Parties
and the Sprint Parties are referred to collectively as the "PARTIES".
Each of Horizon and Bright has entered into a Management Agreement
(each, a "MANAGEMENT AGREEMENT"), a Services Agreement and two Trademark and
Service Mark License Agreements with the Sprint Parties, dated and effective as
of the dates indicated:
- Horizon (June 8, 1998)
- Bright (October 13, 1999)
(collectively, as amended to date, the "SPRINT AGREEMENTS").
The Parties (in the singular, "PARTY") desire to resolve and release
claims specified in this Agreement, whether known or unknown, that any Party
might have against any of the other Parties that arose on or before the
Effective Date (defined below) of this Agreement, including certain claims that
arise out of any actual or claimed actions or inactions of any Party on or
before the Effective Date of this Agreement, except as provided in this
Agreement. The Parties have agreed to take the actions set forth in this
Agreement to avoid the expense and delay inherent in further negotiations and
possible litigation concerning their business relationship.
In consideration of the mutual promises set forth in this Agreement,
and for other good and valuable consideration, the receipt and sufficiency of
which are acknowledged, the Parties agree as follows:
1. ADDENDA. The Parties will execute and deliver Horizon Addendum VIII and
Bright Addendum IV to the respective Sprint Agreements in the forms attached to
this Agreement (the "ADDENDA") contemporaneously with the Parties' execution and
delivery of this Agreement.
2. EFFECTIVE DATE. The parties are executing this Agreement as of the date
noted above, but the terms of this Agreement become effective on (the "EFFECTIVE
DATE"): the later of the date the Parties execute and deliver the Addenda and
the date that Horizon pays Sprint Spectrum L.P. the amount required under this
Agreement.
3. SETTLEMENT PAYMENT; OTHER PAYMENTS.
(a) HORIZON SETTLEMENT PAYMENT. Horizon, on behalf of itself and the
other Horizon Parties, will pay Sprint Spectrum L.P., on its own behalf
and on behalf of the other Sprint Parties, $975,075.97.
(b) JANUARY 2005 PAYMENT. Horizon, on behalf of itself and the other
Horizon Parties, will pay Sprint Spectrum L.P., on its behalf and on
behalf of the other Sprint Parties, $710,192.89, which represents the
Parties' estimate of:
(i) the amount that the Sprint Parties will bill the Horizon Parties
for the monthly payments (and not with respect to the weekly management
fee payments) to be paid under the Sprint Agreements (applying the terms
of the Addenda), including without limitation for CCPU Services and CPGA
Services, for the period between January 1, 2005 and January 31, 2005 (as
would have been reflected in invoices delivered by the Sprint Parties in
February 2005); minus
(ii) the amount of the monthly payments (and not with respect to the
weekly management fee payments) to be paid by the Sprint Parties to the
Horizon Parties under the Sprint Agreements (applying the terms of the
Addenda), including without limitation for net travel and net roaming, for
the period between January 1, 2005 and January 31, 2005 (as would have
been reflected in invoices delivered by the Sprint Parties in February
2005).
(c) ASSET PURCHASE PRICE. Sprint Spectrum L.P. will pay Horizon,
$168,946.49, which is the purchase price Sprint Spectrum L.P. has agreed
to pay to Horizon under that certain Asset Purchase Agreement dated March
16, 2005 between Sprint Spectrum L.P. and Horizon.
(d) METHOD OF PAYMENT. The payments required under Sections 3(a),
3(b) and 3(c) will be made on the Effective Date by netting those amounts.
The Party owing the net difference will pay the difference to the other
Party via wire transfer to the account designated by the receiving Party.
(e) "TRUE-UP" PAYMENT. The Parties will true-up, for the period
between January 1, 2005 and January 31, 2005 (the "TRUE-UP PERIOD"), the
amount by which (i) applying the terms of the Addenda with respect to the
monthly payments to be paid under the Sprint Agreements (and not with
respect to the weekly management fee payments), the actual amount to be
paid by the Horizon Parties to the Sprint Parties minus the actual amount
to be paid by the Sprint Parties to the Horizon Parties under the Sprint
Agreements for the True-up Period, exceeds or is less than (ii) the amount
paid pursuant to Section 3(b) of this Agreement. The Sprint Parties will
send in April 2005 actual invoices for the True-up Period and the payment
required under this Section 3(e) will be invoiced and paid through the
March 2005 monthly statement sent by the Sprint Parties in April 2005.
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4. GENERAL RELEASES.
(a) SPRINT RELEASE OF THE HORIZON PARTIES. Except as provided in
Section 5, each of the Sprint Parties releases and forever discharges the
Horizon Parties and their respective officers, directors, shareholders,
partners, members, subsidiaries, employees, agents and representatives
(the "HORIZON RELEASED PARTIES") from all liabilities, claims, attorneys'
fees, damages, injuries, causes of action, and losses of any kind that any
of the Sprint Parties ever had, now has, may assert or may in the future
claim to have against any of the Horizon Released Parties by reason of any
act, failure to act, occurrence or event occurring or existing on or
before the date of this Agreement, concerning or related to the Sprint
Agreements ("SPRINT'S CLAIMS"). For avoidance of doubt but not for
purposes of limitation, this provision releases and forever discharges
each of the Horizon Released Parties of and from any and all liabilities,
claims, attorneys' fees, damages, injuries, causes of action, and losses
of any kind that any of the Sprint Parties ever had, now has, may assert
or may in the future claim to have against any of the Horizon Released
Parties with respect to any of the matters set forth on Exhibit -------- A
to this Agreement, and waives any and all rights that any of the Sprint
Parties may have with respect - to those matters ("SPRINT'S SPECIFIC
CLAIMS").
(b) HORIZON RELEASE OF THE SPRINT PARTIES. Except as provided in
Section 5, each of the Horizon Parties releases and forever discharges the
Sprint Parties and their respective officers, directors, shareholders,
partners, members, subsidiaries, employees, agents and representatives
(the "SPRINT RELEASED PARTIES") from all liabilities, claims, attorneys'
fees, damages, injuries, causes of action, and losses of any kind that any
of the Horizon Parties ever had, now has, may assert or may in the future
claim to have against any of the Sprint Released Parties by reason of any
act, failure to act, occurrence or event occurring or existing on or
before the date of this Agreement concerning or related to the Sprint
Agreements ("HORIZON'S CLAIMS" and together with Sprint's Claims, the
"CLAIMS"). For avoidance of doubt but not for purposes of limitation, this
provision releases and forever discharges each of the Sprint Released
Parties of and from any and all liabilities, claims, attorneys' fees,
damages, injuries, causes of action, and losses of any kind that any of
the Horizon Parties ever had, now has, may assert or may in the future
claim to have against any of the Sprint Released Parties with respect to
any of the matters set forth on Exhibit A to this Agreement, and waives
any and all rights that any of the Horizon Parties may have with respect
to those matters ("HORIZON'S SPECIFIC CLAIMS" and together with Sprint's
Specific Claims, the "SPECIFIC CLAIMS").
(c) COMPLETE RELEASE. Except as provided in Sections 5, 9 and 13(a),
this Agreement constitutes the complete compromise, settlement, accord and
satisfaction of all of the Claims with no reservation of any rights or
claims, whether stated or implied.
5. EXCEPTIONS TO RELEASED CLAIMS.
(a) SETTLEMENTS ACTIVITY. Neither Party is releasing its right to
claims (including its right to dispute amounts) related to:
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(i) any settlements activity (including, without limitation, payment
of weekly management fees pursuant to Article 10 of the Sprint
Agreements), for the period from February 1, 2005 through the Effective
Date, for which invoices have not yet been generated; the settlements
activity (including, without limitation, payment of weekly management fees
pursuant to Article 10 of the Sprint Agreements) for the period from
February 1, 2005 through the Effective Date will be completed in the
normal course of business and giving effect to the Addenda;
(ii) third-party invoices or other charges for which the Sprint
Parties have not received invoices, which will be billed in the normal
course of business and giving effect to the Addenda; and
(iii) its rights under Article 10 of the Sprint Agreements (as
reflected in the Addenda) with respect to the invoices delivered by the
Sprint Parties pursuant to Section 3(e) of this Agreement.
(b) FUTURE CLAIMS. Nothing in this Agreement constitutes a release
by any Party of claims arising after the date of this Agreement, including
without limitation future claims arising under the Management Agreements
after giving effect to the Addenda that become effective as of January 1,
2005.
(c) INDEMNIFICATION. This Agreement does not modify, waive or
release the Parties' rights and responsibilities under section 13 of the
Management Agreements with respect to indemnification for claims brought
by third parties based upon facts that occurred before the Effective Date.
(d) MOST FAVORED NATION. This Agreement does not modify, waive or
release any of the Horizon Parties' rights under the new section 1.10 of
the Management Agreements, even if the changes to an Other Manager's
Management Agreement are in settlement of that Other Manager's claims that
are similar to claims that the Horizon Parties are releasing under this
Agreement.
(e) MAY 2004 SETTLEMENT AND RELEASE. Notwithstanding any provision
of this Agreement to the contrary, this Agreement will not affect,
terminate or adversely impact in any manner that certain Settlement
Agreement and Mutual Release dated May 12, 2004, by and among Sprint
Corporation, Sprint Spectrum L.P., SprintCom, Inc., WirelessCo, L.P.,
PhillieCo, L.P., APC PCS, LLC, Sprint Communications Company L.P., Horizon
Personal Communications, Inc., Bright Personal Communications Services,
LLC and Horizon PCS, Inc., or any of the releases contained in that
Settlement Agreement and Mutual Release.
6. REPRESENTATIONS AND WARRANTIES. Each of the Parties represents
and warrants to the other Parties that:
(a) it has not commenced any action or proceeding against any other
Party concerning any of the Claims or Specific Claims, before any agency
or other governmental authority, at law, in equity, in arbitration, or
otherwise;
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(b) no promise, inducement or agreement not expressed in this
Agreement or the Addenda has been made;
(c) it has the full right, power and authority to enter into this
Agreement, and to perform according to the terms of this Agreement;
(d) the Party is an entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization;
(e) neither the execution, delivery and performance of this
Agreement, nor the consummation by the Party of the transactions
contemplated by this Agreement, will conflict with, violate or result in a
breach of:
(i) any law, regulation, order, writ, injunction, decree,
determination or award of any governmental authority or any
arbitrator, applicable to the Party, or
(ii) any of the terms, conditions or provisions of the
certificate of limited partnership or certificate or articles of
incorporation or bylaws (or other governing documents) of the Party,
or
(iii) any material agreement of the Party, or
(iv) any material instrument to which the Party is or may be
bound or to which any of its material properties or assets is
subject;
(f) it has obtained all necessary consents and approvals required to
enter into this Agreement;
(g) 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 any court or
before or by any governmental agency that 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 and the Addenda;
(h) it has negotiated the terms of this Agreement, and this
Agreement is the result of arms-length negotiations between the Parties
and their respective attorneys; and
(i) it has not assigned or otherwise transferred any interest in any
of the Claims or Specific Claims.
7. COVENANT NOT TO SUE OR ASSIST THIRD PARTIES. Except for claims for
indemnification and contribution described in Sections 5(c) and 9, no Party will
(a) commence or in any manner seek relief against another Party through any suit
or proceeding arising, based upon, or relating to any of the Claims or Specific
Claims, or (b) voluntarily become a party to any suit or proceeding arising from
or in connection with an attempt by or on behalf of any third party to enforce
or collect an amount based on a Claim or Specific Claim. Nor will any Party
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assist the efforts of any third party attempting to enforce or collect an amount
based on a Claim or Specific Claim, unless required to do so by a court of
competent jurisdiction.
8. CONTRACT. The Parties understand that the terms in this Agreement are
binding contractual commitments and not mere recitals, and that the Parties are
not relying upon any statement or representation made by any Party released, any
such Party's agents or attorneys, or any other person, concerning the nature,
extent or duration of any injuries or damages, or concerning any other thing or
matter, but are relying solely and exclusively upon their own knowledge, belief
and judgment.
9. INDEMNIFICATION. The Sprint Parties and the Horizon Parties will
indemnify, hold harmless and defend each other against all claims, demands,
judgments, causes of action, losses, costs, damages, penalties, fines, taxes,
expenses or liabilities, including reasonable attorneys' fees and costs of
defense, brought against or incurred by them, arising from or in connection with
an attempt by or on behalf of any third party to enforce or collect an amount
based on a Claim or Specific Claim, where the third party's right to enforce or
collect the amount is based on a Claim or Specific Claim and is based upon
rights derived or obtained directly or indirectly from or through a Sprint Party
or an Horizon Party. Some examples of third party actions where indemnity is
appropriate under this Section 9 include: where the third party brings its claim
based on subrogation rights or derivative actions, or based on an assignment by
a Party of that Party's rights to a Claim or Specific Claim.
10. EXPENSES. The Parties will pay their own expenses and attorneys' fees
incurred in connection with the negotiation and execution of this Agreement and
the Addenda.
11. ADDITIONAL FACTS. The Parties are aware that they may after the date
of this Agreement discover claims or facts in addition to or different from
those they now know or believe to be true with respect to Claims and Specific
Claims. Nevertheless, except as set forth in Section 5 of this Agreement, it is
the intention of the Parties to fully, finally and forever settle and release
all such claims, including claims for damages and losses that are presently
unknown or unanticipated. In furtherance of this intention, the releases given
in this Agreement are and will remain in effect as full and complete mutual
releases of Claims and Specific Claims, except as set forth in Section 5 of this
Agreement, notwithstanding the discovery or existence of any additional or
different facts relative to them. Each Party assumes the risk of any mistake in
executing this Agreement and furnishing the releases set forth in this
Agreement. Without limiting the generality of the previous sentences in this
Section 11, each Party waives and relinquishes, to the extent permitted by law,
any right or benefit that such Party has or may have under any provision of
statutory or non-statutory law that may provide that a release does not extend
to claims that a person does not know or suspect to exist at the time of
execution of the release that, if known, would or may have materially affected
the decision to give the release.
12. WAIVERS. No waiver by a Party of any breach of or default under this
Agreement will be deemed to be a waiver of any other breach or default of any
kind or nature of this Agreement. No acceptance of payment or performance by a
Party after any such breach or default will be deemed to be a waiver of any
breach or default of this Agreement, whether or not such Party knows of such
breach or default at the time it accepts such payment or performance. No failure
or delay on the part of a Party to exercise any right it may have will prevent
the
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exercise of that right by that Party at any time the other Party continues to be
in default, and no such failure or delay will operate as a waiver of any
default.
13. ENFORCEMENT OF AGREEMENT; INJUNCTIVE RELIEF.
(a) The releases given in this Agreement do not include a release of
any liabilities, claims, damages, injuries or losses that may arise under
this Agreement.
(b) Each Party acknowledges and agrees that in the event of any
breach of this Agreement, the non-breaching Party or Parties may be
irreparably harmed and may not be made whole by monetary damages.
Accordingly, the Parties, in addition to any other remedy to which they
may be entitled, will be entitled to seek injunctive or other equitable
relief in any court of competent jurisdiction to the extent permitted by
applicable law.
(c) Each Party waives, to the fullest extent permitted by law, the
right to trial by jury in any legal proceeding arising out of or relating
to the enforcement of this Agreement.
(d) The prevailing Party will be entitled to recover from the
opposing Party its expenses (including reasonable attorneys' fees and
costs) incurred in connection with any claim, action or lawsuit brought to
enforce this Agreement.
14. ASSIGNMENT. No Party may assign any of its rights under this Agreement
or delegate its duties under it to any person or entity not a Party unless it
obtains the prior written consent of the other Parties to this Agreement, which
consent may be withheld at such other Party's absolute discretion.
15. LIMITATION ON RIGHTS OF OTHERS. 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.
16. CONFIDENTIALITY. Subject to obligations under applicable law, the
terms and provisions of this Agreement are confidential and proprietary to the
Sprint Parties and to the Horizon Parties and are subject to the terms of
Section 12.2 of the applicable Management Agreement between the Parties.
17. OTHER PROVISIONS.
(a) GOVERNING LAW. All issues and questions concerning the
construction, validity, enforcement and interpretation of this Agreement
will be governed by and construed under Kansas law, without giving effect
to any choice of law or conflict of law rules or provisions (whether of
Kansas or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than Kansas.
(b) JURISDICTION.
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(i) Each Party irrevocably and unconditionally submits to the
nonexclusive jurisdiction of (A) any Kansas state court located in the
County of Johnson or (B) the United States District Court for the District
of Kansas, and any appellate court from any such court, in any suit,
action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment relating to this Agreement.
With respect to such suit, action or proceeding, each Party irrevocably
waives, to the fullest extent permitted by law, the right to object that
such court does not have jurisdiction over such party.
(ii) Each Party irrevocably and unconditionally waives, to the
fullest extent it may legally do so, any objection that it may now or
later have to the venue of any suit, action or proceeding arising out of
or relating to this Agreement in a Kansas state court located in the
County of Johnson or the United States District Court for the District of
Kansas. Each Party irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such suit,
action or proceeding in any such court.
(c) ENTIRE AGREEMENT; BINDING EFFECT. This Agreement constitutes the
entire agreement between the Parties with respect to the subject matter it
covers and supersedes all prior agreements, negotiations, representations
and discussions between the Parties with respect to the subject matter it
covers. This Agreement is binding on and inures to the benefit of the
Parties and their respective successors and assigns.
(d) CONSTRUCTION. The Parties participated in the negotiation and
drafting of this Agreement. If any ambiguity or question of intent or
interpretation arises, the Parties intend that (i) this Agreement be
construed as if they had drafted it together, and (ii) no presumption or
burden of proof arises favoring or disfavoring any Party by virtue of its
role in drafting any provision of this Agreement. All pronouns and any
variations of pronouns used in this Agreement refer to the masculine,
feminine or neuter, singular or plural as the identity of the person or
persons require.
(e) 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 such illegality, invalidity or unenforceability
will not affect the validity, legality or enforceability of the remainder
of this Agreement.
(f) AMENDMENT. Any amendment to this Agreement must be in a written
document signed by the Parties and must state the intent of the Parties to
amend this Agreement.
(g) NO ADMISSION OF LIABILITY. It is expressly understood and agreed
that this Agreement is a compromise of disputed claims and that execution
of, making of payments under, and performing of obligations under this
Agreement are not to be construed as an admission of liability on the part
of any Party.
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(h) COUNTERPARTS. This Agreement may be signed in counterpart or
duplicate copy and by facsimile signature, and any signed counterpart,
duplicate or facsimile copy is the equivalent to a signed original for all
purposes.
[THE REMAINDER OF THIS PAGE IS LEFT BLANK INTENTIONALLY.]
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EACH PARTY HAS COMPLETELY READ THE TERMS OF THIS AGREEMENT, FULLY UNDERSTANDS
THEM AND VOLUNTARILY ACCEPTS THEM FOR THE PURPOSE OF MAKING FULL AND FINAL
COMPROMISE, ADJUSTMENT AND SETTLEMENT OF ALL CLAIMS, DISPUTED OR OTHERWISE, IN
ACCORDANCE WITH THE TERMS OF THIS AGREEMENT
The Parties have executed this Agreement on the date first above
written.
SPRINT SPECTRUM L.P.
By:_________________________________
Name:____________________________
Title:___________________________
SPRINTCOM, INC.
By:_________________________________
Name:____________________________
Title:___________________________
WIRELESSCO, L.P.
By:_________________________________
Name:____________________________
Title:___________________________
PHILLIECO, L.P.
By:_________________________________
Name:____________________________
Title:___________________________
APC PCS, LLC
By:_________________________________
Name:____________________________
Title:___________________________
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SPRINT COMMUNICATIONS COMPANY L.P.
By:_________________________________
Name:____________________________
Title:___________________________
HORIZON PERSONAL COMMUNICATIONS, INC.
By:_________________________________
Name:____________________________
Title:___________________________
BRIGHT PERSONAL COMMUNICATIONS, LLC
By:_________________________________
Name:____________________________
Title:___________________________
HORIZON PCS, INC.
By:_________________________________
Name:____________________________
Title:___________________________
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EXHIBIT A
SPECIFIC CLAIMS RELEASED BY THE PARTIES UPON PAYMENT OF THE NET AMOUNT OWED BY
THE HORIZON PARTIES TO THE SPRINT PARTIES UNDER THIS AGREEMENT
All claims in connection with the following invoices:
ABE-129948
ABE-131388
AFS-016325
AFS-016342
AFS-016360
AFS-016371
AFS-016390
AFS-016467
AFS-016479
AFS-016503
AFS-016525
AFS-016546
AFS-016567
AFS-016586
AFS-016618
AFS-016637
AFS-016681
AFS-016682
AFS-016714
AFS-016740
AFS-016764
AFS-016783
AFS-016812
AFS-016833
AFS-016852
AFS-016871
AFS-016892
AFS-016916
AFS-016942
AFS-016952
AFS-016962
AFS-017004
AFS-017031
AFS-017045
AFS-017064
AFS-017078
AFS-017102
AFS-017137
AFS-017168
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AFS-017178
AFS-017236
AFS-017265
AFS-017266
AFS-017296
AFS-017328
AFS-017342
AFS-017364
AFS-017384
AFS-017407
AFS-017426
AFS-017451
AFS-017474
AFS-017500
AFS-017519
AFS-017550
AFS-017563
MIS-114067
MIS-114332
MR-002104
OC-28179
OC-28781
OC-29379
All claims in connection with the annual true-up for 2004 service bureau fees.
All claims in connection with the March 2004 true- up for Virgin Mobile.
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