<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 6, 1999
REGISTRATION NO. 333-78459
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
AMENDMENT NO. 2
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
NEXTEL PARTNERS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 4813 91-1930918
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
</TABLE>
---------------
4500 CARILLON POINT, KIRKLAND, WASHINGTON 98033, (425) 828-1713
(Address, including ZIP code, and telephone number, including area code, of
the Registrant's principal executive offices)
---------------
DONALD MANNING, ESQ.
4500 CARILLON POINT
KIRKLAND, WASHINGTON 98033
(425) 828-1713
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
---------------
COPY TO:
BRUCE R. KRAUS, ESQ.
WILLKIE FARR & GALLAGHER
787 SEVENTH AVENUE
NEW YORK, NEW YORK 10019
(212) 728-8000
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED OFFER TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
If the securities being registered on this Form are being offered in connection
with the formation of a holding company and there is compliance with General
Instruction G, check the following box. [ ]
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until this Registration Statement shall
become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
================================================================================
<PAGE>
PART II
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A) EXHIBITS:
3.1* Restated Certificate of Incorporation of the Company.
3.2* Bylaws of the Company.
4.1* Indenture, dated January 29, 1999, by and between the Company and The
Bank of New York, as trustee, relating to the 14% Senior Discount
Notes due 2009.
4.2* Registration Rights, dated as of January 29, 1999, by and among the
Company, Donaldson, Lufkin & Jenrette Securities Corporation, Barclays
Capital Inc., First Union Capital Markets, BNY Capital Markets, Inc.
and Nesbitt Burns Securities Inc.
4.3* Credit Agreement, dated as of January 29, 1999, among Nextel Partners
Operating Corp., DLJ Capital Fund, Inc., The Bank of New York, Bank of
Montreal and other financial institutions.
4.4* Borrower Security and Pledge Agreement, dated as of January 29, 1999,
by and between Nextel Partners Operating Corp. and Bank of Montreal.
4.5* Subsidiary Security and Pledge Agreement, dated as of January 29,
1999, by and among the subsidiaries of the Company and Bank of
Montreal.
4.6* Parent Guaranty and Pledge Agreement, dated as of January 29, 1999, by
and between the Company and Bank of Montreal.
4.7* Subsidiary Guaranty, dated as of January 29, 1999, by and among the
subsidiaries of the Company and Bank of Montreal.
5.1* Opinion of Willkie Farr & Gallagher.
8.1* Opinion of Willkie Farr & Gallagher with respect to certain tax
matters.
10.1* Purchase Agreement, dated January 22, 1999, by and among the Company,
Donaldson, Lufkin & Jenrette Securities Corporation, Barclays Capital
Inc., First Union Capital Markets, BNY Capital Markets, Inc. and
Nesbitt Burns Securities Inc.
10.2* Shareholders' Agreement, dated as of January 29, 1999, among the
Company and the shareholders named therein.
10.3* Joint Venture Agreement, dated as of January 29, 1999, by and among
the Company, Nextel Partners Operating Corp., and Nextel WIP Corp.
10.4* Interim Management Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.5* Analog Management Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.6* Trademark License Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.7* Roaming Agreement, dated as of January 29, 1999, by and between Nextel
Partners Operating Corp. and Nextel WIP Corp.
10.8* Switch Sharing Agreement, dated as of January 29, 1999, by and between
Nextel Partners Operating Corp. and Nextel WIP Corp.
II-1
<PAGE>
10.9+ Transition Services Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.10+ iDEN (Registered Trademark) Infrastructure Equipment Purchase
Agreement, dated as of January 29, 1999, by and between Motorola,
Inc. and Nextel Partners Operating Corp.
10.11+ Subscriber Purchase and Distribution Agreement, dated as of January
29, 1999, by and between Motorola, Inc. and Nextel Partners Operating
Corp.
10.12* Agreement Specifying Obligations of, and Limiting Liability and
Recourse to, Nextel, dated as of January 29, 1999, among the Company,
Nextel Partners Operating Corp. and Nextel Communications, Inc.
10.13* Asset and Stock Transfer and Reimbursement Agreement, dated as of
January 29, 1999, by and between Nextel Partners Operating Corp. and
Nextel WIP Corp.
10.14* Employment Agreement, dated as of January 29, 1999, between the
Company and John Chapple.
10.15* Employment Agreement, dated as of January 29, 1999, between the
Company and John Thompson.
10.16* Stock Option Agreement, dated as of January 29, 1999, between the
Company and John Thompson.
10.17* Non-negotiable Promissory Note, dated January 29, 1999, by John
Thompson to the Company.
10.18* 1999 Nonqualified Stock Option Plan of the Company
10.19* Form of Restricted Stock Purchase Agreement, dated as of November 20,
1998, between the Company and John Chapple, John Thompson, Daivd
Thaler, David Aas, Perry Satterlee and Mark Fanning.
10.20* Form of Amendment No. 1 to Restricted Stock Purchase Agreement, dated
as of January 29, 1999, between the Company and John Chapple, John
Thompson, David Thaler, David Aas, Perry Satterlee and Mark Fanning.
10.21* Employment Agreement, dated as of January 29, 1999, between the
Company and David Aas.
10.22* Employment Agreement, dated as of January 29, 1999, between the
Company and Perry Satterlee.
10.23* Employment Agreement, dated as of January 29, 1999, between the
Company and David Thaler.
10.24 Subscription and Contribution Agreement, dated as of January 29,
1999, among the Company and the Buyers named therein.
12* Ratio of Earnings to Fixed Charges.
21* Subsidiaries of the Company.
23.1* Consent of Arthur Andersen LLP.
23.2* Consent of Willkie Farr & Gallagher (included in their opinions filed
as Exhibits 5.1 and 8.1).
24.1* Powers of Attorney (included on signature page to Registration
Statement on Form S-4).
25.1* Statement on Form T-1 of Eligibility of Trustee.
27* Financial Data Schedule.
II-2
<PAGE>
99.1* Form of Letter of Transmittal.
99.2* Form of Notice of Guaranteed Delivery.
99.3* Form of Letter to Clients.
99.4* Form of Letter to Nominees.
- ----------
* Previously filed.
+ Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule
246-2 under the Securities Exchange Act of 1934, as amended.
(B) FINANCIAL STATEMENT SCHEDULES:
None.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing a Form S-4 and has duly caused this Amendment No. 2 to
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Kirkland, State of Washington, on the
6th day of July, 1999.
NEXTEL PARTNERS, INC.
By: /s/ John Chapple
------------------------------------
John Chapple
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to this Registration Statement has been signed by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ John Chapple President, Chief Executive July 6, 1999
- ----------------------------- Officer and Director
John Chapple
* Chief Financial Officer July 6, 1999
- ----------------------------- and Treasurer
John D. Thompson
* Director July 6, 1999
- -----------------------------
Timothy M. Donahue
* Director July 6, 1999
- -----------------------------
Andrew H. Rush
* Director July 6, 1999
- -----------------------------
Andrew E. Sinwell
* Director July 6, 1999
- -----------------------------
Dennis M. Weibling
</TABLE>
*By: /s/ John Chapple
-------------------------
John Chapple
Attorney-in-Fact
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
--- -----------
<S> <C>
3.1* Restated Certificate of Incorporation of the Company.
3.2* Bylaws of the Company.
4.1* Indenture, dated January 29, 1999, by and between the Company and The
Bank of New York, as trustee, relating to the 14% Senior Discount
Notes due 2009.
4.2* Registration Rights, dated as of January 29, 1999, by and among the
Company, Donaldson, Lufkin & Jenrette Securities Corporation,
Barclays Capital Inc., First Union Capital Markets, BNY Capital
Markets, Inc. and Nesbitt Burns Securities Inc.
4.3* Credit Agreement, dated as of January 29, 1999, among Nextel Partners
Operating Corp., DLJ Capital Fund, Inc., The Bank of New York, Bank
of Montreal and other financial institutions.
4.4* Borrower Security and Pledge Agreement, dated as of January 29, 1999,
by and between Nextel Partners Operating Corp. and Bank of Montreal.
4.5* Subsidiary Security and Pledge Agreement, dated as of January 29,
1999, by and among the subsidiaries of the Company and Bank of
Montreal.
4.6* Parent Guaranty and Pledge Agreement, dated as of January 29, 1999,
by and between the Company and Bank of Montreal.
4.7* Subsidiary Guaranty, dated as of January 29, 1999, by and among the
subsidiaries of the Company and Bank of Montreal.
5.1* Opinion of Willkie Farr & Gallagher.
8.1* Opinion of Willkie Farr & Gallagher with respect to certain tax
matters.
10.1* Purchase Agreement, dated January 22, 1999, by and among the Company,
Donaldson, Lufkin & Jenrette Securities Corporation, Barclays Capital
Inc., First Union Capital Markets, BNY Capital Markets, Inc. and
Nesbitt Burns Securities Inc.
10.2* Shareholders' Agreement, dated as of January 29, 1999, among the
Company and the shareholders named therein.
10.3* Joint Venture Agreement, dated as of January 29, 1999, by and among
the Company, Nextel Partners Operating Corp., and Nextel WIP Corp.
10.4* Interim Management Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.5* Analog Management Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.6* Trademark License Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.7* Roaming Agreement, dated as of January 29, 1999, by and between
Nextel Partners Operating Corp. and Nextel WIP Corp.
10.8* Switch Sharing Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.9+ Transition Services Agreement, dated as of January 29, 1999, by and
between Nextel Partners Operating Corp. and Nextel WIP Corp.
10.10+ iDEN (Registered Trademark) Infrastructure Equipment Purchase
Agreement, dated as of January 29, 1999, by and between Motorola,
Inc. and Nextel Partners Operating Corp.
10.11+ Subscriber Purchase and Distribution Agreement, dated as of January
29, 1999, by and between Motorola, Inc. and Nextel Partners Operating
Corp.
10.12* Agreement Specifying Obligations of, and Limiting Liability and
Recourse to, Nextel, dated as of January 29, 1999, among the Company,
Nextel Partners Operating Corp. and Nextel Communications, Inc.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
--- -----------
<S> <C>
10.13* Asset and Stock Transfer and Reimbursement Agreement, dated as of
January 29, 1999, by and between Nextel Partners Operating Corp. and
Nextel WIP Corp.
10.14* Employment Agreement, dated as of January 29, 1999, between the
Company and John Chapple.
10.15* Employment Agreement, dated as of January 29, 1999, between the
Company and John Thompson.
10.16* Stock Option Agreement, dated as of January 29, 1999, between the
Company and John Thompson.
10.17* Non-negotiable Promissory Note, dated January 29, 1999, by John
Thompson to the Company.
10.18* 1999 Nonqualified Stock Option Plan of the Company
10.19* Form of Restricted Stock Purchase Agreement, dated as of November
20, 1998, between the Company and John Chapple, John Thompson, Daivd
Thaler, David Aas, Perry Satterlee and Mark Fanning.
10.20* Form of Amendment No. 1 to Restricted Stock Purchase Agreement,
dated as of January 29, 1999, between the Company and John Chapple,
John Thompson, David Thaler, David Aas, Perry Satterlee and Mark
Fanning.
10.21* Employment Agreement, dated as of January 29, 1999, between the
Company and David Aas.
10.22* Employment Agreement, dated as of January 29, 1999, between the
Company and Perry Satterlee.
10.23* Employment Agreement, dated as of January 29, 1999, between the
Company and David Thaler.
10.24 Subscription and Contribution Agreement, dated as of January 29,
1999, among the Company and the Buyers named therein.
12* Ratio of Earnings to Fixed Charges.
21* Subsidiaries of the Company.
23.1* Consent of Arthur Andersen LLP.
23.2* Consent of Willkie Farr & Gallagher (included in their opinions
filed as Exhibits 5.1 and 8.1).
24.1* Powers of Attorney (included on signature page to Registration
Statement on Form S-4).
25.1* Statement on Form T-1 of Eligibility of Trustee.
27* Financial Data Schedule.
99.1* Form of Letter of Transmittal.
99.2* Form of Notice of Guaranteed Delivery.
99.3* Form of Letter to Clients.
99.4* Form of Letter to Nominees.
</TABLE>
- ----------
* Previously filed.
+ Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule
246-2 under the Securities Exchange Act of 1934, as amended.
<PAGE>
TRANSITION SERVICES AGREEMENT
This TRANSITION SERVICES AGREEMENT (this "Agreement") dated as of
January 29, 1999, is by and between Nextel WIP Corp., a Delaware corporation
("NWIP"), and Nextel Partners Operating Corp., a Delaware corporation (the
"Company").
RECITALS
A. Nextel, through its subsidiaries, operates an iDEN-based wireless
communications system through which it provides wireless communications
services in various markets throughout the United States. To enhance its
ability to provide its customers with greater geographic coverage that is
consistent with its existing service, operations, and objectives, Nextel,
through NWIP, is entering into a contractual joint venture with Nextel
Partners, Inc. ("NPI") and its Subsidiaries, including the Company.
B. The agreement of the parties with respect to the formation and
operation of the contractual joint venture is set forth in the Joint Venture
Agreement of even date herewith, by and among NWIP, NPI and the Company (the "JV
Agreement"), and various Collateral Agreements. This Agreement is a Collateral
Agreement.
C. As part of the contractual joint venture, NWIP has agreed to
provide the Company with certain transition services for a limited time to
assist the Company in launching operations in the Territory.
In consideration of the mutual promises and covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, NWIP and the Company hereby agree as follows:
AGREEMENT
1. Defined Terms. Unless otherwise defined in this Agreement, capitalized terms
used herein have the same meanings as in the JV Agreement.
2. Transition Services. Commencing on the date of this Agreement, NWIP will
provide, or will cause other controlled subsidiaries of Nextel to provide, to
the Company and solely in connection with the Company's operation of an ESMR
Network in the Territory pursuant to the JV Agreement, those services set forth
on Exhibit A attached hereto and made a part hereof (each a "Transition
Service" and collectively, the "Transition Services").
3. Term. The Transition Services will be provided to the Company commencing on
the date of this Agreement and continuing with respect to each Transition
Service through the termination date set forth next to that Transition Service
on Exhibit A (in each case, the "Termination Date"), unless the Company elects
to terminate its use of any such Transition Service at an earlier date, as
provided for in Section 4(a) or the parties agree to extend the term of any
Transition Service pursuant to Section 5(b). The term of this Agreement will
run through the Termination Date or Amended Termination Date (as defined below)
of the last Transition Service(s) being provided hereunder.
<PAGE>
4. Partial Termination. (a) The Company may terminate its use of any Transition
Service provided to it hereunder on thirty (30) days' prior written notice to
NWIP. On the 30th day following NWIP's receipt of such written notice, both the
Company's obligation to pay NWIP for such Transition Service (other than for
services rendered prior to the effective date of such termination) will cease
and NWIP's obligations to provide, or to cause to be provided, such Transition
Service will cease. The Company will have no right to a refund or offset of any
sums paid or owing to NWIP in connection with the termination of the Company's
use under this Section 4(a) of any Transition Service.
(b) The Company's termination of its use of any Transition
Service pursuant to Section 4(a) will in no way affect (i) NWIP's obligation to
perform or caused to be performed any Transition Services whose use has not
been so terminated or whose Termination Date as set forth on Exhibit A has not
yet arrived, or (ii) NWIP's right to receive any amounts due to NWIP from the
Company for any Transition Service, the use of which has not been terminated,
or for the terminated Transition Service through the effective date of its
termination.
5. Service Pricing. (a) Prior to its Termination Date, each Transition Service
will be provided to the Company at the appropriate unit price identified on
Exhibit A (with respect to each Transition Service, its "Unit Price").
(b) Effective on the Termination Date with respect to any
Transition Service, the Company and NWIP may agree in writing to extend the
term of such Transition Service by amending the appropriate Termination Date on
Exhibit A, pursuant to a writing signed by each of them (each new Termination
Date with respect to any Transition Service, an "Amended Termination Date").
Except as otherwise agreed by the parties in a writing signed by each of them,
with respect to any Transition Service that is given an Amended Termination
Date: (i) for the first 90 days following the Termination Date with respect to
such Transition Service, the Company will be charged for such service at the
Unit Price applicable to such Transition Service; (ii) beginning the 91st day
and ending the 179th day following the Termination Date with respect to such
Transition Service, the Company will be charged for such service at ** of the
Unit Price applicable to such Transition Service; and (iii) beginning the 180th
day following the Termination Date with respect to such Transition Service, the
Company will be charged for such service at ** of the Unit Price applicable
to such Transition Service, which charge will increase by ** every 30 days
thereafter, up to a maximum of ** of the Unit Price applicable to such
Transition Service.
(c) Nothing in this Agreement is intended to or shall limit
or restrict the parties' rights and obligations under Section 5.8 of the JV
Agreement and nothing herein is intended to or shall govern the provision or
pricing of any "Required Systems" or certain operating activities that cannot
be performed by the Company as set forth in Section 5.8 of the JV Agreement.
6. Billing and Payment. The parties' agreement concerning the procedures
governing billing and payment for the services provided and all other charges
and amounts assessed hereunder is set forth in Section 13.6 of the JV
Agreement.
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
2
<PAGE>
7. Assignment. Notwithstanding anything herein to the contrary, NWIP may
delegate its obligation to provide Transition Services hereunder to any
third-party vendor(s) used by Nextel or the NDS to provide similar services,
provided that each such third-party vendor agrees in writing to perform such
Transition Services on the terms set forth herein, and, provided, further, that
the cost of any such Transition Services provided by any such third-party
vendor shall be the actual charges imposed by such third-party vendor on Nextel
or the NDS for providing similar services. If NWIP delegates its obligation to
provide Transition Services hereunder to any third-party vendor, NWIP shall not
disclose the provisions of Section 5(b) hereof to such third-party vendor if
such third-party vendor is not then in possession of such information or such
information is not then available publicly.
8. Taxes. The Company will be responsible for all sales, use, and other taxes,
levies and charges (other than taxes based on net income or net profits) imposed
by applicable taxation authorities on the Transition Services provided to the
Company hereunder. If NWIP or any direct or indirect subsidiary of Nextel
performing Transition Services is required to pay any such taxes, levies or
charges, the Company will promptly reimburse NWIP therefor.
9. Service Levels and Non-discrimination. NWIP will provide, or will cause the
controlled subsidiaries of Nextel providing Transition Services hereunder to
provide, the Transition Services to the Company in substantially as timely a
manner and at substantially the same service levels as similar services are
provided to Nextel or any of its wholly owned subsidiaries. Neither NWIP nor
any other provider of Transition Services hereunder that is a controlled
subsidiary of Nextel shall discriminate against the Company in favor of Nextel
or any wholly owned subsidiary of Nextel in providing the Transition Services.
10. Breach. Any breach or alleged breach of this Agreement or disputes arising
hereunder will be resolved by the parties pursuant to the procedures set forth
in Article 12 of the JV Agreement and, in cases involving a billing dispute,
Section 13.6 of the JV Agreement, which are incorporated herein by this
reference.
11. Miscellaneous.
(a) Excusable Delay/Time Extension. Where performance by
either party to this Agreement is delayed by reason of an Excusable Delay (as
defined in the JV Agreement), the time for performance, and any otherwise
applicable time limit, schedule or deadline, shall be extended for a period of
time equal to the period of Excusable Delay.
(b) Amendments. This Agreement may be amended only by a
writing executed by the parties.
(c) Entire Agreement. This Agreement and the other
Transaction Agreements (as defined in the JV Agreement) set forth the entire
understanding of the parties hereto and thereto with respect to the subject
matter hereof and thereof, and supersede all prior contracts, agreements,
arrangements, communications, discussions, representations and warranties,
whether oral or written, between the parties, including but not limited to the
Memorandum of Agreement, dated as of May 1, 1998, among Wireless Investment
Partners, L.L.C., NWIP and Nextel, as amended.
3
<PAGE>
(d) Notices. Any notice, request or other communication
required or permitted hereunder must be in writing and is given: (a) when
received if personally delivered; (b) 12 hours after being sent by telecopy,
with confirmed answerback; or (c) 1 business day after being sent by priority
delivery by established overnight courier, to the parties at their respective
addresses set forth below.
To NWIP: Nextel WIP Corp.
1505 Farm Credit Drive
McLean, VA 22102
Attention: General Counsel
Telecopy: (703) 394-3896
With a copy to: Jones, Day, Reavis & Pogue
North Point
901 Lakeside Avenue
Cleveland, Ohio 44114
Attention: Jeanne M. Rickert
Telecopy: (216) 579-0212
To the Company: Nextel Partners Operating Corp.
4500 Carillon Point
Kirkland, WA 98033
Attention: General Counsel
Telecopy: (425) 828-8098
With a copy to: Friedman Kaplan Seiler LLP
875 Third Avenue
New York, NY 10022
Attention: Gary D. Friedman
Telecopy: (212) 355-6401
Either party by written notice to the other given in accordance with this
Section 11.4 may change the address or the persons to whom notices or copies
thereof are to be directed.
(e) Counterparts. This Agreement may be executed in any
number of counterparts, each of which will be deemed to be an original, and all
of which together will constitute one and the same instrument.
(f) Waiver. Except as otherwise provided in this Agreement,
any party may waive, in writing, compliance by the other parties thereto (to
the extent such compliance is for the benefit of the party giving such waiver)
with any of the terms, covenants or conditions contained in this Agreement
(except as may be imposed by law). Any waiver by any party of any violation of,
breach of, or default under, any provision of any of this Agreement, by any
other party will not be construed as, or constitute, a continuing waiver of
such provision, or waiver of any other violation of, breach of, or default
under, any other provision of this Agreement.
4
<PAGE>
(g) Third Parties. Nothing expressed or implied in this
Agreement is intended, or may be construed, to confer upon or give any person
or entity other than the parties hereto any rights or remedies hereunder.
(h) Severability. If any provision of this Agreement or the
application of such provision is invalid, illegal or unenforceable in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision of this Agreement or invalidate or render unenforceable
such provision in any other jurisdiction. The parties will, to the extent
lawful and practicable, use their best reasonable efforts to enter into
arrangements to reinstate the intended benefits of any provision held invalid,
illegal or unenforceable.
(i) Choice of Law. This Agreement shall be governed by New
York law, without regard to choice of law rules that would result in the
application of another state's law.
(j) Construction.
(1) Words used in this Agreement, regardless of the
number or gender specifically used, will be deemed and construed to include any
other number, singular or plural, and any other gender, masculine, feminine or
neuter, as the context requires. The parties hereto have participated equally
in the drafting of this Agreement and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of authorship of any
provision of this Agreement.
(2) The schedules and exhibits attached to this
Agreement are incorporated herein and are part of this Agreement for all
purposes. Unless otherwise stated, any reference in this Agreement to an
exhibit, section or schedule is to an exhibit, section or schedule of this
Agreement.
(3) The headings in this Agreement are solely for
convenience of reference and are not to be given any effect in the construction
or interpretation of this Agreement.
(k) Agreement. This Agreement is one of the Collateral
Agreements identified in the JV Agreement. Accordingly, certain provisions of
the JV Agreement by their terms apply to this Agreement, including, without
limitation, Section 2.6, Article 12, and Sections 13.2, and 13.10.
* * *
5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized representatives as of the day and year
first above written.
NEXTEL WIP CORP.
By: /s/ Alan Strauss
________________________________
Name: Alan Strauss
Title: Vice President
NEXTEL PARTNERS OPERATING CORP.
By: /s/ John Thompson
________________________________
Name: John Thompson
Title: Chief Financial Officer and
Treasurer
6
<PAGE>
Confidential: Use or disclosure of this document is subject to the restriction
on the Confidentiality Statement.
iDEN(R) INFRASTRUCTURE EQUIPMENT PURCHASE AGREEMENT
This Agreement ("Agreement") is between Motorola, Inc., a Delaware corporation,
by and through its Network Solutions Sector, Customer Solutions Group with
offices at 1301 East Algonquin Road, Schaumburg, Illinois 60196 ("Motorola") and
Nextel Partners Operating Corp., a Delaware Corporation, with offices at 4500
Carillon Pt., Kirkland, Washington 98033 ("Customer").
RECITALS:
Customer has obtained or will obtain the right to use all required licenses
authorizations, and approvals to construct and operate an iDEN System in the
Area as defined below in Section 1.
Customer or it's wholly owned subsidiaries desire to purchase and Motorola
desires to sell, install and integrate an iDEN System pursuant to the terms and
conditions of this Agreement.
The Exhibits to this Agreement are incorporated by reference into the Agreement,
and include the following:
Exhibit "A" Project Order Form
Exhibit "B" Technical Overview: Notes On The iDEN System **
Exhibit "C" System Performance Criteria and Acceptance Test Plan
Exhibit "D" Implementation Engineering, Site Preparation, Installation
and Integration
Exhibit "E" System Maintenance
Exhibit "F" Object-Code Computer Program License
Exhibit "G" Training
Exhibit "H" Documentation
Exhibit "I" Implementation Schedule
Exhibit "J" Price Book, **
Exhibit "K" Listing of "Year 2000 Compliant" Products
The parties shall enter into a separate agreement for the sale by Motorola and
purchase by Customer of Subscriber Units for use on the iDEN System (the
"Subscriber Agreement").
AGREEMENT:
Now therefore, in consideration of the mutual obligations herein contained, the
parties agree as follows:
1.0 DEFINITIONS
Capitalized terms used in this Agreement and the Exhibits shall have the
following meanings:
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(R) Registered U.S. Patent & Trademark Office.
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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ACCEPTANCE TEST PROCEDURE - ATP
Exhibit "C" describes the types of tests included in the ATP. The
Acceptance Test Procedure will be performed accordingly.
AFFILIATE
As defined in Rule 12b-2 under the Securities Exchange Act of 1934, as
amended.
AGREEMENT
As defined in the preamble hereof.
AREA
The geographic area of any of the metropolitan and rural market areas
throughout the United States, U.S. metropolitan markets, as listed in
the initial Exhibit "A" or any subsequent Exhibit "A".
BUSINESS DAY
Any day other than a Saturday, Sunday or a day on which commercial
banking institutions are authorized or required by law, regulation or
executive order to be closed in New York, New York.
CHANGE ORDER
Any change agreed to in writing, by Customer and Motorola, that modifies
the type or quantity of equipment or services purchased under this
Agreement.
COMMERCIAL SERVICE
The point at which the iDEN System or any portion thereof is functional
and operative and has one or more Subscribers.
CONDITIONAL ACCEPTANCE AND FINAL ACCEPTANCE
Conditional Acceptance of an iDEN System shall occur as follows:
Conditional Acceptance shall occur and be evidenced by a notice signed
by Customer at the completion of the ATP, which shall not be
unreasonably withheld or upon Commercial Service. Final Acceptance shall
occur and be evidenced by a notice signed by Customer when all material
Punchlist items have been resolved.
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With respect to Expansion Product, in the event Customer purchases
Installation and Integration Services from Motorola prior to the date of
shipment, Conditional and Final Acceptance shall occur in the same
manner as provided in the "Conditional Acceptance and Final Acceptance"
definition above with respect to the iDEN System.
For Expansion Product purchased without Installation and Integration
Services, Final Acceptance shall occur concurrently with the shipment of
each such Expansion Product.
CONFIDENTIAL INFORMATION
That information marked as confidential or proprietary and transferred
pursuant to this Agreement which may include, without implied
limitation, formulas, processes, designs, photographs, plans, samples,
equipment, equipment performance reports, Subscriber lists, pricing
information, studies, findings, inventions, ideas, drawings, schematics,
sketches, specifications, parts lists, technical data, databases,
Software in any form, flow charts, algorithms and other business and
technical information. Excluded from Confidential Information is that
which (i) the recipient had in its possession without confidential
limitation prior to disclosure, (ii) which is independently developed by
either party, (iii) which is known or becomes known to the general
public without breach of this Agreement, or (iv) which is received
rightfully and without confidential limitation from a third party.
Confidential Information shall be subject to the requirements of Section
14 of this Agreement.
CUSTOMER PROGRAM MANAGER
Customer Program Manager shall have the meaning set forth in Section
2.3.
DATE OF SHIPMENT
The date of shipment as shown on the relevant Motorola invoice for the
product shipped from Motorola to Customer.
DIGITAL MOBILE NETWORK
Digital Mobile Network means a wide-area network of specialized mobile
radio base stations that employs digital and other advanced, spectrally
efficient communications technologies to provide a full range of
wireless communication services that may include voice, dispatch,
interconnected telephone and data services employing iDEN technology.
DOCUMENTATION
The documentation described in Exhibit "H".
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EBTS
"EBTS" is defined as the base radio units as specified in Exhibit "B".
EVENT OF FORCE MAJEURE
"Event of Force Majeure" is as defined in Section 18.
EXPANSION PRODUCT
All Fixed Network Equipment, Software, and other products purchased to
add to or expand an iDEN System.
FOB
When used herein shall mean that Motorola shall deliver to Customer's
carrier at a manufacturing site or Motorola facility located within the
Continental United States.
FIXED NETWORK EQUIPMENT - FNE
The Motorola supplied equipment described generally in Motorola's Price
Book (including the iDEN Switch). Non-Motorola-supplied equipment which
is not integral to the iDEN Switch or to the Sites is excluded from FNE,
as are Subscriber Units.
FUNDING AFFILIATE
"Funding Affiliate" is as defined in Section 7.7.
iDEN
iDEN is the trademark for Motorola's advanced integrated radio-telephone
and dispatch communications system that is the subject of this
Agreement. It is an integrated wireless telecommunications system that,
among other things, incorporates handover control and mobility
management, dispatch subsystem, full telephone interconnect capability,
short message service capability, and circuit switched and packet data
capabilities that architecturally and functionally operates as
designated by Motorola.
iDEN SWITCH
The Switch equipment that routes calls from Subscriber Units to the
called party (and vice versa), coordinates the handoff process and
records System interconnect traffic.
iDEN SYSTEM
iDEN System shall have the meaning set forth in Section 2.5.
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IMPLEMENTATION SCHEDULE
The schedule set forth in the Exhibit "I" for the installation of the
iDEN System.
INITIAL PROGRAM LOAD (IPL)
The Initial Program Load (IPL) Software is delivered with the iDEN
System, shall be the most current version of iDEN Software and includes
the Software necessary to support all major subsystems or components of
the iDEN System. A license fee for the System IPL is identified in
Exhibit "A" or set forth in the Price Book. Any re-sale of equipment
other than to Nextel Communications, Inc. or its wholly owned
subsidiaries is subject to Motorola's approval and will require a
relicensing of the Software from Motorola, including payment of an IPL
license fee by the new owner.
INSTALLATION AND INTEGRATION SERVICES
Installation and Integration Services shall mean the services set forth
in Exhibit "D" "Implementation Engineering, Site Preparation,
Installation and Integration".
INTERCONNECTED CARRIER
Any local exchange carrier, inter-exchange carrier, or reseller of local
or inter-exchange service that is connected to the iDEN System.
INTERCONNECTION FACILITIES
The medium connecting the iDEN Switch to the switched network of any
Interconnected Carrier including termination facilities such as
protected termination blocks, end office termination repeaters and
Customer service units to permit direct connection to the iDEN System.
MSO
An MSO shall be defined as a Mobile Switching Office that consists of
the iDEN Switch (with or without a Home Location Register "HLR"), the
Dispatch Application Processor ("DAP"), Metro Packet Switch ("MPS"),
Base Station Controller ("BSC"), and Operation Maintenance Console
("OMC") Equipment.
MOTOROLA PROGRAM MANAGER
Motorola Program Manager shall have the meaning set forth in Section
2.3.
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OTHER EQUIPMENT
Other Equipment shall be defined as any products supplied by or through
Motorola under the Agreement that are not included as part of an iDEN
System or System Expansion as defined herein, excluding iDEN System
engineering, Other Software, Other Services, and Subscriber Units.
OTHER SERVICES
Other Services shall be defined as services supplied by Motorola under
the Agreement that are not included as part of an iDEN System or System
Expansion of the types defined herein
OTHER SOFTWARE
Other Software shall be defined as software supplied by or through
Motorola under the Agreement that is not included as part of an iDEN
system or System Expansion of the types defined herein, excluding System
engineering and Other Services.
PRICE BOOK
Motorola's iDEN(R) Infrastructure Price Book, which is kept by Motorola
on the iDEN web site for use in the United States and updated
periodically by Motorola.
PUNCHLIST
The list, prepared during the ATP and the 14 day period subsequent to
the date of Conditional Acceptance and finalized no later than 14 days
subsequent to the date of Conditional Acceptance, which sets forth those
items, if any, identified by Customer in good faith and agreed to by
Motorola (which agreement Motorola shall not unreasonably withhold or
delay) where the iDEN System or Expansion Product fail to comply with
the applicable specifications and performance standards set forth in
Exhibit B1 and the ATP, to be resolved by Motorola before Final
Acceptance of the iDEN System or Final Acceptance of Expansion Product,
as the case may be.
RF
Radio Frequency.
RSO
RSO means Remote Switch Operation.
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SITE
Each of the locations comprising an iDEN System, which contains FNE,
including the geographic location that houses the iDEN Switch.
SMP
The Software Maintenance Program defined in Exhibit "E".
SOFTWARE
The object-code computer programs furnished by Motorola to Customer for
use solely in conjunction with the FNE under the terms of the Software
License, Exhibit "F".
SUBSCRIBER
A person who uses the iDEN System entitling the iDEN System operator to
revenue.
SUBSCRIBER UNIT
Any manufactured and assembled, mobile or portable, iDEN
telecommunications unit intended for use by any Subscriber.
SYSTEM EXPANSION
"System Expansion" is defined below in Section 2.6. The definition of
System Expansion shall apply only to the System Expansion in each unique
Area.
TIME FRAME
The interval between the start date and the completion date for a
particular activity as set forth in the Implementation Schedule.
2.0 SCOPE OF AGREEMENT; IMPLEMENTATION
2.1 From time-to-time during the term of this Agreement, Customer
agrees to purchase from Motorola and Motorola agrees to sell to
Customer the iDEN System, Expansion Product, FNE, Other
Equipment, Other Services and/or the Other Software in accordance
with the terms and conditions set forth in this Agreement.
Customer and Motorola shall complete an Exhibit A for each iDEN
System ordered and will complete an Exhibit A for any and all
Expansion Product or Other Equipment, Other Services and Other
Software ordered. Exhibit A may, depending on Customer's needs,
include an order for any or all of the following: an iDEN System
and related services, Expansion Product and related services,
FNE, Other Equipment, Other Services and/or Other Software. Once
completed,
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an Exhibit A may be modified thereafter by mutual agreement of
the parties by amendment or Change Order.
Purchases may be made hereunder by any wholly owned subsidiary of
Customer as long as the obligation is guaranteed by the Funding
Affiliate. By executing Exhibit A for an iDEN System, a wholly
owned subsidiary of Customer shall be deemed to have agreed to
all of the terms and conditions of this Agreement with respect to
such iDEN System. References in this Agreement to Customer shall
be deemed to refer to any such wholly owned subsidiary which is
the purchaser of an iDEN System.
2.2 This Agreement (including a completed Exhibit A) constitutes an
order and is considered a notice to proceed with the placing of
subcontracts, ordering of non-Motorola manufactured equipment,
and the manufacture of equipment as necessary to deliver timely
the products and services in Exhibit "A" as specified herein,
and, with respect to an iDEN System, in accordance with the
Implementation Schedule, Exhibit "I", attached.
2.3 Motorola and Customer shall each appoint a Program Manager who
shall have the responsibility to make good faith efforts to
resolve problems and disputes prior to initiating the dispute
resolution procedures set forth in Section 31. Their respective
responsibilities are as follows:
2.3.1 The responsibilities of the Motorola Program Manager shall
include:
a. Serve as the primary Customer contact for the
equipment and services purchased hereunder.
b. Serve as the focal point for all Motorola internal
plant and field issues.
c. Oversee deliveries, subcontracts, installation, iDEN
System testing and integration, documentation,
training and all duties required to coordinate the
work of the various Motorola team members.
d. Determine the final definition of all Customer and
project requirements.
e. Establish a detailed project schedule and oversee
accomplishment of project milestones.
f. Establish the project team structure and staffing.
g. Establish and maintain project reporting and
measurement procedures.
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h. Meet regularly with Customer's Program Manager to
review progress and project issues.
i. Facilitate Customer's order placement and order
acceptance procedures.
j. Insure that adequate resources, including adequate
personnel, are dedicated to each project undertaken
pursuant to this Agreement such that the project is
completed in a timely, efficient manner.
2.3.2 The responsibilities of the Customer Program Manager shall
include:
a. Serve as primary Motorola contact for the iDEN System.
b. Serve as the focal point for all Customer internal
and field issues.
c. Schedule and oversee accomplishment of Customer
project milestones.
d. Review and approve accomplishment of project
milestones.
e. Disseminate project reports and measurement
procedures within Customer's organization.
f. Approve all modifications to specifications.
g. Approve and acquire all Sites, notify the Motorola
Program Manager of Site availability, and coordinate
Motorola's access to the Sites.
h. Meet regularly with the Motorola Program Manager to
review progress and project issues.
2.4 Operational Understandings
2.4.1 The providing by Customer of digital wireless
communications to meet the changing market needs in a
given Area requires that the make up of the equipment
and/or services designated for, and located in that Area,
be ongoing and continually enhanced, such that Customer
has the opportunity to meet its continuing business goals.
These understandings are not intended to modify, expand,
or change, in any way, the warranties provided under the
Agreement, as amended from time to time.
2.4.2 In order to support the goals of Customer in a given Area,
a series of projects must be implemented from time to time
as required. These projects will range in scope from the
construction and installation of a
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grouping of equipment, hardware, and software to allow
Customer to provide initial digital wireless
communication services in an Area, to enhancements and
expansion of that initial grouping, to the procurement
and provision of stand alone equipment, software, and
services.
2.4.3 Projects in a given Area are separate and distinct,
although they may be subject to adjustments or revisions
as contemplated herein prior to completion, provided that
such adjustments or revisions do not affect the
Implementation Schedule. Such projects may be based on,
among other things, the amount of Motorola provided
services included and the relative technical complexity of
the project. They are categorized into an iDEN System and
System Expansions of the type defined herein and into the
definitions herein of Other Equipment, Other Services, and
Other Software.
2.4.4 Each iDEN System or System Expansion project undertaken
for a given Area shall be governed by a specific beginning
and completion date. Such projects shall include the
agreement by both parties as to the project requirements,
make up of goods and/or services to be provided, and a
specific implementation schedule defining in detail the
required activities of both Motorola and Customer, and the
time frame in which it is anticipated in the
Implementation Schedule that they will be accomplished.
2.4.5 Each project may stand alone or may build on previous
projects in a given Area. All such projects in a
particular Area, taken in total, represent the state and
level of Customer capabilities to provide integrated
digital communication services in such Area at a given
point in time.
2.5 "iDEN System" Defined
An "iDEN System" shall be defined as a specified grouping
of equipment, software and related services ordered by
Customer from Motorola for the construction of a Digital
Mobile Network to provide mobile integrated services for
an Area utilizing the basic iDEN technology platform,
including the six-time-slot TDMA technology and any
advancements or improvements in such technology.
The specified grouping shall be ordered, delivered,
installed and acceptance tested in accordance with the
Implementation Schedule(s) mutually agreed to between the
parties, and shall include, at Customer's option, some or
all of the following items, that are scheduled for
delivery to Customer prior to the commencement date of
acceptance testing defined in the relevant Implementation
Schedule for such iDEN System:
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a) FNE Equipment (to include, as
appropriate, MSO, CSO or RSO equipment and/or
modifications and the related Enhanced Base
Transceiver System ("EBTS") sites and equipment, to
the extent ordered for installation in and
reasonably identified with the Digital Mobile
Network to be constructed in a specific Area),
Software and other products supplied by or through
Motorola, excluding Subscriber Units, essential to
compliance with the performance specifications
contained in Motorola's Price Book or set forth in
Exhibit "J" or otherwise reasonably necessary to
the achievement of Conditional Acceptance by the
relevant iDEN System; and
b) Motorola supplied services relating to
the above equipment, Software and other products,
including but not limited to:
** as appropriate to the FNE
Equipment ordered;
** (except those to be
performed at Motorola's cost), as
appropriate to the FNE Equipment ordered;
Motorola ** which Motorola
furnishes in order to perform **.
** and the ** which Motorola
furnishes in order to perform ** (except
those to be performed at Motorola's cost).
Except as stated below, the parties acknowledge that
Motorola must supply services as defined in sub-paragraph
(b) above, in conjunction with a grouping of equipment and
software defined in sub-paragraph (a) above, in order to
be defined as an iDEN System.
The parties acknowledge that an iDEN System may be subject
to alteration or revision during the design and/or build
out phase to address particular opportunities or
difficulties reasonably expected to be encountered in the
construction of a Digital Mobile Network. The parties
further acknowledge that so long as such alterations,
revisions or similar matters
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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do not adversely affect the project scope and/or
schedule, such alterations, revisions or similar matters
(together with related equipment, service and software
orders or change orders) shall be deemed to constitute
the originally defined and specified iDEN System in
question.
The parties also recognize that Customer may procure
services other than those outlined in sub-paragraph (b)
above, from qualified third parties or from within
Customer's employee ranks, and that such internal or third
party service arrangements, provided in connection with
Motorola supplied equipment, Software and related
services, are consistent with the definition of an iDEN
System provided that such services comply with Motorola
published installation and engineering standards.
If the acceptance testing of such iDEN System does not
result in achievement of ATP-Conditional Acceptance, and
if such failure is the result of Motorola's actions or
failure to act or is due to circumstances within its
reasonable control, then the additional items of
equipment, Software and related services which are
required to be provided by Motorola for such iDEN System
to achieve Conditional Acceptance also shall be deemed to
be a part of, and governed by the terms of the originally
defined and specified iDEN System in question and shall be
provided to Customer at no additional charge.
2.6 "System Expansion" Defined
A " System Expansion" shall be defined as a specified
grouping of equipment, Software and related services
ordered by Customer from Motorola utilizing the basic iDEN
technology platform, and purchased as a single order or a
group of related orders which are received by Motorola
from Customer within a thirty (30) day period from the
date on which Motorola received the first of such related
orders from Customer, unless otherwise mutually agreed to,
and having an aggregate purchase price of at least **. The
specific grouping shall be ordered for the modification of
the existing design of, or any increase in the
capabilities or capacities of, and constructed in, around,
or adjacent to, an existing iDEN System.
The specified grouping shall be ordered, delivered,
installed and acceptance tested in accordance with the
Implementation Schedule(s) mutually agreed to between the
parties, and shall include at Customer's Option all of the
following items, that are scheduled for delivery to
Customer prior to the commencement date of acceptance
testing defined in the relevant Implementation Schedule
for such System Expansion:
- ----------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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a) FNE Equipment (to include, as
appropriate, MSO, CSO or RSO equipment and/or
modifications and the related EBTS sites and
equipment, to the extent ordered for installation
in and reasonably identified with the Digital
Mobile Network that is the subject of such System
Expansion), Software and other products supplied by
or through Motorola, excluding Subscriber units,
essential to compliance with the performance
specifications or otherwise reasonably necessary to
the achievement of Conditional Acceptance by the
relevant System Expansion; and
b) Motorola supplied services relating to
the above equipment, Software and other products,
including but not limited to:
** as appropriate to the FNE
Equipment ordered;
** (except those to be
performed at Motorola's cost), as
appropriate to the FNE Equipment ordered;
Motorola ** which Motorola
furnishes in order to perform **.
** and the ** which Motorola
furnishes in order to perform ** (except
those to be performed at Motorola's cost).
Except as stated below, the parties acknowledge that
Motorola must supply services as defined in sub-paragraph
(b) above, in conjunction with a grouping of equipment and
software defined in sub-paragraph (a) above, in order to
be defined as a System Expansion.
The parties acknowledge that a System Expansion may be
subject to alteration or revision during the design and/or
build out phase to address particular opportunities or
difficulties reasonably expected to be encountered in the
construction of a Digital Mobile Network. The parties
further acknowledge that so long as such alterations,
revisions or similar matters do not adversely affect the
project scope and/or schedule, such
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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alterations, revisions or similar matters (together with
related equipment, service and Software orders or change
orders) shall be deemed to constitute the originally
defined and specified System Expansion in question.
The parties also recognize that Customer may procure
services other than those outlined in sub-paragraph (b)
above, from qualified third parties or from within
Customer's employee ranks, and that such internal or third
party service arrangements, provided in connection with
Motorola supplied equipment, Software and related
services, are consistent with the definition of a System
Expansion provided that such services comply with Motorola
published installation and engineering standards.
If the acceptance testing of such System Expansion does
not result in achievement of ATP-Conditional Acceptance,
and if such failure is the result of Motorola's actions or
failure to act or is due to circumstances within its
reasonable control, then the additional items of
equipment, Software and related services which are
required to be provided by Motorola for such System
Expansion to achieve Conditional Acceptance also shall be
deemed to be a part of, and governed by the terms of the
originally defined and specified System Expansion in
question and shall be provided to Customer at no
additional charge..
3.0 RESPONSIBILITIES OF CUSTOMER
Customer is responsible for the following:
3.1 Design the RF coverage plan and frequency plan for each Area
including but not limited to Site location, frequencies at each
Site, RF coverage from each Site, co-channel interference caused
from one Site to another Site, co-channel interference from
non-Customer sites.
3.2 Procure the right to use necessary station licenses together with
such other authorizations as may be required to construct and
operate the iDEN System, including without implied limitation,
Site building permits, zoning variances, and any other required
approval or authorizations from appropriate government and other
authorities, including but not limited to the FCC, and any
required authorizations from any local agencies. Assume the
responsibility for interfacing with appropriate carriers and
other providers for the provision of Interconnection Facilities,
electrical power and Customer-supplied equipment in accordance
with the Implementation Schedule.
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3.3 Make all legal arrangements and pay all expenses, that may be
required, to Site owners or to others, to construct and operate
each Site in accordance with the provisions of this Agreement.
3.4 Bear the costs of its own legal fees, as well as charges for Site
acquisition, Interconnection Facilities, telephone and utility
charges and other services and items being supplied by Customer
under this Agreement.
3.5 Provide ingress and egress to Sites, as necessary and as
reasonably requested by Motorola, and have Sites available for
timely installation of iDEN System equipment.
3.6 Negotiate in good faith the Implementation Schedule and adhere to
the schedule for performance of the responsibilities set forth
therein.
3.7 Negotiate in good faith the Punchlist for the iDEN System and
Expansion Product prior to the expiration of the ** period
following the date of Conditional Acceptance.
3.8 Not unreasonably withhold either Conditional or Final Acceptance
or any other approvals required under this Agreement.
3.9 Assume responsibility for diagnosis, analysis, isolation, and
remedy of problems in the Interconnection Facilities or at the
Interconnected Carrier side of the interface with the iDEN
System.
3.10 Furnish necessary databases to Motorola in accordance with the
Implementation Schedule, subject to the confidentiality
provisions set forth herein.
3.11 Make payments according to the schedule set forth in Section 7
of this Agreement.
3.12 Purchase or provide those required services set forth in Exhibit
"D".
3.13 Assume responsibility for lawful operation of the iDEN System.
3.14 Be responsible for the timely transportation of all equipment
from the FOB shipment point to the sites
3.15 After shipment by Motorola, provide and assume all associated
costs for warehousing, storage, inventory, and staging of
equipment prior to transport to the installation sites.
3.16 As necessary, provide secure covered storage areas at each Site.
To the extent required for installation and warranty work,
provide access to each Site by authorized Motorola personnel
during reasonable business hours.
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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3.17 As necessary, furnish and install suitable environmental control
facilities in each building.
3.18 Provide telephone company network configuration including dial
plan and design.
3.19 If required by Motorola in order to complete installation, make
available the technical details of any and all Customer-supplied
equipment to which the iDEN System must be interfaced. Also
provide technical liaison personnel as needed with the knowledge
of Customer-supplied equipment.
3.26 Provide any outside cable support bridges required, coaxial, and
transmission line access ports into the buildings, inside conduit
or cable ducts, any necessary inside floor trenches and cable
raceways required for installation.
3.27 Be responsible for risk of loss for all equipment from FOB point.
3.22 In response to Motorola's reasonable request, provide Motorola
with information as may be required to enable Motorola to comply
with all applicable laws and regulations.
3.23 Provide all Site development services and engineering drawings as
set forth in Exhibit "D", in order to enable Motorola to install
and integrate the iDEN System in accordance with the agreed upon
schedule set forth in Exhibit "I".
3.24 Provide capable technical personnel in order to be trained in the
operation and maintenance of the System and to interface with
Motorola with regard to operational and maintenance issues.
3.25 In the event Customer fails to perform any of its
responsibilities or fails to adhere to the Implementation
Schedule and such failure causes a Motorola delay, Motorola shall
document all extra work or reasonable expense incurred as a
result of the delay and Customer shall compensate Motorola for
such work or reasonable expense. Extra expense shall include, but
not be limited to, reasonable expenses associated with travel and
living expenses, warehouse charges, transportation charges,
vehicle and equipment rentals.
3.26 Provide Motorola with reasonable notice of any anticipated delay
in Customer's performance hereunder.
4.0 OBLIGATIONS OF MOTOROLA
Motorola shall:
4.1 Determine the required material, effort, and services necessary
for Installation and Integration at no extra cost.
4.2 Negotiate in good faith the Implementation Schedule and timely
perform according to the Schedule.
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4.3 Negotiate in good faith the Punchlist for the iDEN System and
Expansion Product prior the expiration of the ** period following
the date of each respective Conditional Acceptance.
4.4 Install the MSO equipment (if applicable) and adjust the iDEN
System to the standards set out in Exhibits "B" and "C" and in
compliance with Exhibit "D".
4.5 Timely advise Customer of modifications required.
4.6 Timely offer, at a reasonable cost to Customer, a retrofit
package for any change in standards subsequently put into effect
by the industry, the government, regulatory agencies, as well as
those promulgated by Motorola.
4.7 Give reasonable assistance to Customer in its acquisition of
Interconnection Facilities as set forth in Section 3.2 above as
may reasonably be requested by Customer.
4.8 Review the frequency plan prepared by Customer or Customer's
consultant at no additional charge to Customer. Because of
differences in radio coverage and interference models and the
timeframe of implementation, this review will not be a complete
detailed alternate engineering of the system design, but rather a
review of selected design elements in sample areas. It is
understood that Motorola's obligation is only to review the
frequency plan as an accommodation to Customer. Motorola shall
not recalculate or verify the frequency plan preparer's work and
shall have no responsibility or liability whatsoever based on
this review.
4.9 Not divert to another customer any equipment scheduled for
delivery to Customer pursuant to an accepted purchase order
without Customer's approval.
4.10 Make spares and replacement parts available for ** from the date
of this Agreement.
4.11 Install and integrate the iDEN System and Expansion Product in
compliance with all applicable laws, rules and regulations.
4.12 Use commercially reasonable efforts to accept Customer's orders,
to make timely delivery and to install and integrate the iDEN
System according to the terms and conditions of this Agreement.
4.13 Remedy all Punchlist items, defects and problems during the
warranty and maintenance periods.
4.14 Obtain necessary work permits and visas to enable Motorola
personnel to perform under this Agreement.
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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4.15 In response to Customer's reasonable request, provide Customer
with information reasonably known to Motorola which may be
required to enable Customer to comply with all applicable laws
and regulations.
4.16 Use skilled personnel, properly trained and competent to perform
assigned tasks.
4.17 Provide Customer with reasonable notice of any anticipated delay
in Motorola's performance hereunder.
4.18 Prior to shipment Motorola will obtain type approval for any
equipment sold herein that requires type approval in the Area.
4.19 Bear the cost of its own legal fees and other charges that are
its responsibility in connection with the performance of its
obligations under this Agreement.
4.20 Construct and install the iDEN System and other equipment in
conformity with all applicable federal laws and regulations in
effect at the time the applicable Exhibit A for the iDEN System
is agreed to by the parties.
5.0 SITES
This Agreement, and the prices listed or to be listed on Exhibit "A" are
predicated on the use of certain Site configurations provided by
Customer. Customer is free to alter Site locations during the course of
performance of this Agreement. However, should alternate locations cause
Site-reconfigurations or increased costs to Motorola, Motorola shall
timely provide Customer with a quote for price adjustments to reflect
the increased costs to Motorola and modify Exhibit "I" as appropriate.
6.0 CHANGES
6.1 After execution of this Agreement, either party may request
changes to the specifications or other requirements of this
Agreement. Motorola shall submit a Change Order to Customer
within thirty (30) days after receipt of such request.
6.2 If the Change Order is acceptable to Customer, Customer will
execute the Change Order and return to Motorola within ten (10)
days of submittal. In no event shall any changes be implemented
without written authorization from Customer.
7.0 PAYMENT AND PRICING
7.1 General Payment Terms
Customer shall pay to Motorola the price of the iDEN System and
related services, the Expansion Project, the Other Equipment, the
Other Services and the
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Other Software as set forth in the applicable Exhibit "A" or
Change Order in U.S. dollars, and according to the following
terms and payment schedules:
7.1.1 Payment Terms
Payment Terms for an iDEN System or System Expansions of
the types defined herein, shall be as follows:
o ** of total order price upon **.
o ** of total order price upon **.
o ** of total order price upon ** of an iDEN
System or System Expansion.
o ** of total order price upon ** of an iDEN
System or System Expansion.
Notwithstanding the above, if Customer intentionally
delays the implementation of an iDEN System or System
Expansion of the types defined herein, then ** shall be
deemed to be granted ** after the implementation date set
forth in the Implementation Schedule for such System or
System Expansion and all payments associated with ** shall
be due and payable as of this date. Additionally, any
warranties for such System or System Expansion set forth
elsewhere in this Agreement which commence upon ** also
shall be deemed to commence ** after the implementation
date set forth in the Implementation Schedule for such
System or System Expansion. ** shall be deemed to be
granted ** after the implementation date set forth in the
Implementation Schedule for such iDEN System or System
Expansion and all payments associated with ** shall be due
and payable as of this date.
Other Equipment Payment Terms shall be as follows:
** of Other Equipment price upon **.
Other Software Payment Terms shall be as follows:
** of Other Software price upon **.
Other Services Payment Terms shall be as follows:
Invoices will be issued ** for Other Services
completed.
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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All invoices due net ** from date of invoice.
7.1.2 Prices do not include applicable sales, use, excise or
similar taxes. To the extent Motorola is required by law
to collect such taxes, one hundred percent (100%) thereof
shall be added to invoices and paid in full by Customer.
7.1.3 The licensing fee for Software, licensed as set out in
Exhibit "F" and provided for use with the iDEN System is
or shall be set forth in Exhibit "A".
7.1.4 Any costs required to modify the iDEN System in order to
comply with local codes or regulations shall be Customer's
responsibility.
7.1.5 For any amount due hereunder which remains unpaid for more
than **, the Customer shall pay Motorola a service fee at
the rate of ** of the amount due for ** or portion thereof
that the amount remains unpaid.
7.2 Specific Payment Terms
7.2.1 Method of Payment
Payment shall be made by wire/telegraphic transfer to the
following address:
**
Routing No.: **
Account No.: **
Address: **
**
Motorola is responsible for timely notifying Customer of
any change in the foregoing wire/telegraphic transfer
instructions. Customer shall not be liable for any late
payment or missed payment caused by Motorola's failure to
notify Customer of any such change.
7.2.2 Subject to Section 7.5, any volume purchases price
reductions shall be based on **.
7.3 Training
In 1998 and 1999, Motorola agrees to make available to Customer's
employees the training program described on Exhibit "G" and
Customer agrees to pay **
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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of the program price for each of Customer's personnel attending
such training, provided, that for each **, Customer shall ** and
for each **, Customer shall **.
7.4 Changes in Exhibit "A"
Customer may **, pursuant to a Change Order, the specific
equipment and services ordered or to be ordered herein subject to
the below:
a. All changes must be made before ** in advance of the
ship date shown in the agreed upon or to be agreed
upon project schedule, as modified hereafter; and
b. The total dollar value of equipment and services
(excluding drop ship items) set forth or to be set
forth in Exhibit "A" may not be reduced to ** of the
originally ordered amount.
7.5 Prices Generally
Provided that **, prices for FNE equipment, Software,
maintenance plans and training sold hereunder shall be **,
adjusted only for additional costs of unique engineering,
special implementations or differences based upon Customer's
market conditions.
If **, all prices hereunder shall be renegotiated. Prices for
equipment and software sold hereunder shall be **.
7.6 In-Kind Capital Contribution
The closing of an equity investment by Motorola in Customer is a
condition precedent to this Agreement. As a result of the
issuance of equity to Motorola, Customer will have an **
equipment credit (the "Equipment Credit") in the amount of
Eighteen Million Three Hundred Sixty Six Thousand Four Hundred
Ninety Dollars ($18,366,490) that may be used as set forth below:
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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Upon the placing of each order, the parties shall calculate the
percentage of the total dollar value of the order comprised by
the dollar value of the ** equipment in the order. Each payment
thereafter on such order, for as long as the Equipment Credit is
still in existence, shall be made by a combination of cash and
Equipment Credit. The cash amount shall be ** x payment due. The
Equipment Credit shall be the ** x payment due, and the Equipment
Credit shall be reduced by a like amount. Customer may at any
time choose to apply less than the above stated maximum Equipment
Credit amount to any order and increase the cash portion.
7.7 Assurance of Payment
As to each order placed hereunder, Customer represents that it is
authorized to make the purchase that the intended use is within
Customer's authority, that the Customer's Board of Directors has
authorized the entering into this Agreement and the purchases to
be made hereunder, and that Customer has access to adequate funds
to pay any and all outstanding orders from Motorola when due.
With respect to any purchase, Motorola may reasonably request and
Customer shall provide reasonable assurances of its ability to
pay. At no point in time shall Customer's outstanding account
balance exceed **; if it ever does or is expected to, Customer
shall, make one or more payments to an escrow account or
prepayments to Motorola that reduce its outstanding balance below
the above-referenced threshold, or provide a letter of credit
from a commercial bank or equivalent financial institution, or
such other additional assurances of payment or security for
payment as Motorola and Customer may mutually agree upon. The
above credit may be revoked and any outstanding payments shall
immediately become due and payable if there is a material adverse
change in Customer's financial condition. Customer shall notify
Motorola of any material adverse change in its financial
condition.
**
8.0 ACCEPTANCE TESTING
8.1 A full ATP is performed only when a System is purchased. When
Other Equipment is purchased, a limited ATP covering only the
Equipment purchased shall be performed if such service is
requested and paid for separately by Customer. The parties agree
that the acceptance testing shall be done pursuant to the ATP
which shall be developed by Motorola as set forth below. Motorola
shall review the ATP with Customer. Attached as Exhibit "C" is an
ATP that the parties agree sets forth the type of tests that may
be made to determine Final Acceptance of an iDEN System. This ATP
is generic in nature and tests
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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operational features. Should a certain feature or option not be
purchased then it is agreed that portion of the ATP shall be
deleted and will not be performed.
8.2 Motorola shall conduct an ATP for an iDEN System and for
Expansion Product when Installation and integration Services are
purchased by Customer. Seven (7) days prior to the scheduled date
for tests, Motorola shall notify Customer of the time and place
at which such tests will be conducted and Customer shall have the
right to observe ATP tests and the results thereof. Should
Customer request additional testing above and beyond the ATP,
these tests shall not be considered until after Conditional
Acceptance of the System. Motorola shall prepare and present to
Customer a quotation detailing the time and material charges that
such additional testing may require.
8.3 The ATP is divided into three (3) parts:
8.3.1 The System Test which verifies that the iDEN System's
components function correctly together and interface with
the Interconnected Carrier and that hand-offs between
Sites and the dial plan work correctly.
8.3.2 The Site Test which checks that each Site is operating
according to specifications.
8.3.3 The Switch Test which verifies the proper functioning of
the iDEN Switch.
8.4 Individual Site Tests and the Switch Test shall be performed in
accordance with the ATP as soon as the individual Sites and iDEN
Switch are completed. The System Test shall be performed as soon
as the iDEN Switch and Site Tests are completed. If all the Sites
are not available and operational due to Customer's failure to
obtain the Sites by the required scheduled time as contained in
Exhibit "I" hereto ("Unavailable Sites"), the tests shall still
take place.
8.5 The Areas served by the Unavailable Sites shall not be included
in the System Test. When the Unavailable Sites are operational
and available, the Site Test shall be completed. As long as all
other items required for ATP or Final Acceptance are complete,
the existence of Unavailable Sites shall not hold up the ATP or
Final Acceptance.
8.6 Additional Testing Costs
The cost of obtaining a passing test for each of the items in the
ATP is included in the purchase price of the iDEN System. Any
additional testing shall be billed to Customer as set forth in
Section 8.2. This includes, but is not limited to, testing due
to:
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a. Customer's desire for testing not included in the ATP; and
b. Retesting that is needed because Customer's Site team causes
the need for the retest either by the failure to do what is
required of them under the Agreement or because of any action
they take that necessitates the retesting; and
c. RF interference from outside sources; and
d. The need to respond to complaints of third parties alleging
Customer's iDEN System interferes with their systems, unless
the equipment sold hereunder is not operating within licensed
parameters.
9.0 FNE WARRANTY AND SOFTWARE MAINTENANCE PROGRAM
9.1 FNE Warranty
9.1.1 Motorola represents and warrants that all products,
Software and items delivered under this Agreement conform
in design, materials and workmanship to the appropriate
Motorola Technical Specifications set forth in Exhibit
"B".
Hardware Warranty: Motorola radio communications infrastructure
products and FNE, except EBTS, are warranted to meet the
specifications set forth in Exhibit "B1" and to be free from
defects in material and workmanship for a period of ** from the
date of Conditional Acceptance. All hardware and software
associated with EBTS equipment are warranted to meet the
specifications set forth in Exhibit "B1" and to be free from
defects in material and workmanship for a period of ** from the
Date of Shipment.
9.1.2 Other Equipment Warranty Start Date
Other Equipment warranty and any associated software
warranty shall commence upon the Date of Shipment of the
Other Equipment plus five (5) days.
9.1.3 Customer shall be responsible for the initial level of
diagnosis (i.e., for identification and isolation of FNE
problems to the board level), for hardware, firmware and
Software removal and replacement, and for sending the
malfunctioning product, packed in a manner to prevent
damage, to the designated Motorola repair depot within the
Continental United States. Customer shall be responsible
for associated shipping charges. When such products or
their replacements are being returned to Customer,
Motorola shall bear such charges.
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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<PAGE>
9.1.4 Parts and labor at the ** to repair or replace defective
FNE will be **.
9.1.5 In the event a defect occurs during the warranty period
Motorola, at its option, will either repair or replace the
product. Any item replaced will be deemed to be on an
exchange basis, and any item retained by Motorola through
replacement will become the property of Motorola. Repaired
or replaced parts shall have a warranty of the greater of
the remainder of this warranty period or **.
9.2 This Warranty does not cover defects, damage, or malfunctions
resulting from:
9.2.1 Use of the products in other than their normal and
customary manner.
9.2.2 Misuse, accident, neglect, environmental or Site
conditions not conforming to the specifications for the
product as set out in the current equipment
specifications, or unauthorized access to source or object
code or manipulation of software elements
9.2.3 Unauthorized alterations or repairs, use of unapproved
parts in the products or the combination or interfacing of
the products, in each case in a manner not approved by
Motorola.
9.2.4 An event of Force Majeure.
9.2.5 Installation, integration, or movement of products from
their original installation Site by anyone other than
Motorola or anyone not approved in writing by Motorola, or
not in accordance with Motorola standards and guidelines.
9.2.6 Failure of antennas, lines, (provided the warranty, if
any, from the manufacturer of such products is passed
through to Customer) or any part of the Interconnection
Facilities.
9.2.7 Failure of Customer to maintain or provide maintenance for
the iDEN System pursuant to Motorola equipment and
Software maintenance agreements, or other maintenance,
substantially in accordance with the Documentation and
under the supervision of one or more individuals who shall
have completed appropriate Motorola training.
9.2.8 Damage which occurs during shipment of the product to
Motorola for warranty repair.
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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9.3 Except as associated with an agreed-to or permitted assignment,
this express warranty is extended by Motorola, Inc. to Customer
and it's wholly-owned subsidiaries only and is valid only in the
Area.
9.4 Software Maintenance Program (SMP)
Motorola Software provided in connection with the Initial System
is expressly warranted to be free from defects which result in
reproducible malfunctions for a period of ** from the date of
Conditional Acceptance (the "Warranty Period") of the iDEN System
when used on FNE sold hereunder. Motorola agrees to provide all
labor at ** necessary to correct any service affecting Software
defects for the full Warranty Period without charge to the
Customer.
9.4.1 For ** from Conditional Acceptance, Motorola shall provide
to Customer a Software Maintenance Program, the terms of
which are fully set forth in Exhibit "E". Motorola shall
provide all labor at ** necessary to correct service
affecting Software defects. At the expiration of this **
period Customer may renew the SMP at Motorola's then
current rate. Payments shall be made quarterly, in
advance.
9.4.2 Other Software Warranty Start Date
Other Software warranty and SMP shall commence upon the
Date of Shipment of the Other Software plus five (5) days.
9.4.3 Failure by Motorola to provide support under this SMP
shall not be construed as conveying any rights which are
in addition to those already granted herein, nor shall
such failure be construed as conveying any rights of
ownership of Software.
9.4.4 Motorola represents and warrants that Software supplied
under this Agreement does not have "Software Traps"
designed to permit unauthorized access, to disable or
erase Software, hardware or data or to perform any other
such actions.
9.4.5 Motorola shall timely perform all warranty work hereunder
in a manner that minimizes service disruption to
Customer's Subscribers.
9.5 Non-Motorola-Manufactured Products
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
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Non-Motorola-manufactured products are warranted only to the
extent provided to Motorola by the manufacturer or supplier
thereof. Non-Motorola-manufactured products are defined to
include antennas, transmission lines and combining equipment.
9.6 Motorola warrants that each hardware, software, and firmware
product delivered under this Agreement and listed on Exhibit "K"
as "Year 2000 Compliant" shall be able to accurately process date
data (including, but not limited to, calculating, comparing, and
sequencing) from, into, and between the year 1999 and the year
2000, including leap year calculations, when used in accordance
with the product documentation provided by Motorola, provided
that all listed or unlisted products (e.g., hardware, software,
firmware) used in combination with such listed product properly
exchange date data with it. This warranty shall extend through
June 1, 2000. Customer must notify Motorola, in writing, no later
than July 1, 2000 of Product that does not conform to this
Express Warranty. The remedies available for breach of this
warranty shall be as defined in, and subject to, the terms and
limitations of Sections 9.1 through 9.5 and Section 9.7. Except
as provided herein, nothing in this warranty statement shall be
construed to limit any rights or remedies provided elsewhere in
this Agreement with respect to matters other than Year 2000
performance.
9.7 THE WARRANTIES IN THIS AGREEMENT ARE GIVEN IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, WHICH ARE SPECIFICALLY EXCLUDED,
INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL MOTOROLA BE
LIABLE FOR INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES
TO THE FULL EXTENT SUCH MAY BE DISCLAIMED BY LAW.
THIS WARRANTY EXTENDS ONLY TO INDIVIDUAL PRODUCTS; BATTERIES ARE
EXCLUDED BUT CARRY THEIR OWN SEPARATE LIMITED WARRANTY FROM THEIR
MANUFACTURER. MOTOROLA DISCLAIMS LIABILITY FOR RF COVERAGE UNDER
THIS WARRANTY.
10.0 PRODUCT CHANGES OR SUBSTITUTIONS
At any time during its performance of this Agreement, Motorola may
implement changes in the products set forth or to be set forth in
Exhibit "A", modify the drawings and specifications relating thereto, or
substitute products of more recent design; provided, however, that any
such changes, modifications or substitutions, under normal and proper
use shall not materially or adversely affect physical or functional
interchangeability or performance of the product within the iDEN System
or result in additional cost to Customer, unless Customer has been
notified of and agreed to such additional cost, and shall not detract
from the safety of the product and shall be FCC type accepted, if
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required, and shall not cause Customer's iDEN System to be incompatible
with the Digital Mobile Network operated by Nextel Communications.
11.0 DELAY
In the event Customer fails to perform any of its responsibilities or
fails to adhere to the Implementation Schedule and such failure will
cause Motorola delay and subsequent additional costs, Customer agrees to
notify Motorola, in writing, reasonably in advance, of the time Motorola
will begin to incur additional expenses and the steps Customer will take
to rectify the situation. Motorola has the right, at its option, to take
steps necessary to minimize additional cost that would be incurred by
the delay including, but not limited to, reductions of personnel or
suspension of work. Motorola will provide written notice to Customer in
advance of such steps.
12.0 DISCLAIMER OF PATENT LICENSE
Nothing contained in this Agreement shall be deemed to grant, either
directly or by implication, any license under any patents or patent
applications of Motorola, except that Customer shall have the limited
right to use which arises from the sale of goods.
13.0 INTELLECTUAL PROPERTY INDEMNITY
13.1 Motorola shall indemnify defend Customer against claims that
Motorola-supplied products supplied hereunder directly infringe a
patent, trademark, copyright or trade secret that is legally
enforceable in the U.S., provided that;
a. Customer promptly notifies Motorola in writing of the claim
provided, however, that Customer's failure to provide such
notice shall not relieve Motorola of liability under this
Section 13 except to the extent Motorola was prejudiced
thereby;
b. Customer grants Motorola sole control of the defense and all
related settlement negotiations;
c. Customer gives Motorola reasonable information and assistance
for the defense, including appeal, all at Motorola's expense.
13.2 Subject to the conditions and limitations of liability stated in
this Agreement, Motorola shall indemnify and hold Customer
harmless from all payments which by final judgments in such suits
may be assessed against Customer on account of such infringement
and shall pay resulting settlements, costs, and damages finally
awarded against Customer by a court of law.
13.3 If Motorola-supplied products or Software become, or in
Motorola's opinion are likely to become, the subject of such a
claim, Motorola, at its option and expense,
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shall either (i) procure the right for Customer to continue using
such products or Software, or (ii) replace or modify same so that
they become non-infringing without affecting the function,
capability or cost to Customer. If neither of the foregoing
alternatives is available on terms which are reasonable in
Motorola's judgment, Customer can return Motorola-supplied
products and/or Software for full credit on the entire unusable
portion thereof.
13.4 Motorola has no liability for any claim of patent or copyright
infringement to the extent based upon adherence to
specifications, designs, or instructions furnished by Customer,
nor for any claim based upon the combination, operation, or use
of any Motorola-supplied products or Software supplied hereunder
with products, software, or data not supplied by Motorola, nor
for any claim to the extent based upon alteration of the products
or modification of any software supplied by entities other than
Motorola.
13.5 IN NO EVENT SHALL MOTOROLA BE LIABLE TO CUSTOMER FOR INCIDENTAL
OR CONSEQUENTIAL DAMAGES ARISING FROM INFRINGEMENT OR ALLEGED
INFRINGEMENT OF PATENTS, COPYRIGHTS, OR TRADEMARKS. THIS SECTION
13.5 SHALL NOT LIMIT IN ANY MANNER MOTOROLA'S OBLIGATIONS TO
INDEMNIFY AND DEFEND CUSTOMER AS SET OUT ABOVE.
14.0 CONFIDENTIALITY
14.1 During the performance of this Agreement, the parties may deem it
necessary to provide each other with Confidential Information.
The parties agree:
14.1.1 To maintain the confidentiality of such Confidential
Information and not disclose same to any third party,
except as authorized by the original disclosing party in
writing.
14.1.2 To restrict disclosure of Confidential Information to
employees and technical, legal and financial consultants
who have a "need to know" or in connection with a public
or private debt or equity offering of securities, or as
required by law or a court or as required for compliance
with the appropriate securities laws, provided no
documents shall be given to any third parties until the
disclosing party has had a reasonable opportunity to
review them. Any such information that the disclosing
party believes is confidential the receiving party will
use reasonable efforts to get confidential treatment from
such third parties. Such Confidential Information shall be
handled with the same degree of care which the receiving
party applies to its own confidential information but in
no event less than reasonable care.
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14.1.3 To take precautions necessary and appropriate to guard the
confidentiality of Confidential Information, including
informing its employees and consultants who handle such
Confidential Information that it is confidential and not
to be disclosed to others and as to all consultants obtain
a signed non-disclosure agreement consistent herewith.
14.1.4 That Confidential Information is and shall at all times
remain the property of the disclosing party. Except as
otherwise provided herein, no use of any Confidential
Information is permitted and no grant under any
proprietary rights is hereby given or intended, including
any license implied or otherwise.
14.1.5 To use such Confidential Information only as required in
performance of this Agreement.
14.2 Except as may be required by applicable law or regulatory
authority, neither party shall disclose to any third party
Confidential Information, the contents of this Agreement, the
Exhibits, or any Amendments without the prior written consent of
the other.
15.0 TRADEMARK AND PUBLICITY
Nothing contained in this Agreement shall be construed as conferring any
right to use any name, trademark or other designation of either party
hereto, including any contraction, abbreviation, or simulation of any of
the foregoing, in advertising, publicity or marketing activities. No
publicity, advertising, etc. with regard to this Agreement or the iDEN
System which mentions the other party shall be released without prior
written consent of the other party.
16.0 SHIPMENT, DELIVERY AND PACKING
16.1 Motorola may ship products at any time during the Time Frame for
that activity set forth in the Implementation Schedule and may
invoice Customer upon shipment as provided in Section 7 of this
Agreement. No shipment of products during said Time Frame shall
be considered early for purposes of invoicing.
16.2 Customer shall select the carrier and notify Motorola in writing.
16.3 Motorola shall use all reasonable efforts to ship products
directly to the Site where it will be permanently installed, or
such other location as designated by Customer.
16.4 In the event that the Site is not available because Customer has
not met its obligations hereunder to receive the products when
shipped, Motorola, at its option, may ship said products to a
warehouse in or near the area as designated by Customer, and
Customer shall bear the costs of warehousing, reloading,
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transporting, off-loading and moving the products onto the Site
when such Site becomes available.
16.5 Shipping documentation shall be drawn in accordance with
Motorola's standard practices. Shipping terms are FOB
manufacturing site or Motorola facility within the continental
United States.
16.6 Motorola shall have the equipment securely packed so as to
withstand numerous handlings and loading as appropriate for
inland, sea and/or air transportation. Motorola shall take
reasonable protective measures to protect equipment from weather
and shock, considering the different shapes and special features
of the equipment.
17.0 TITLE, INDEMNITY, INSURANCE
17.1 Good title, free and clear of all liens or other encumbrances to
the FNE and other products supplied hereunder and risk of loss
for all such products shall pass to Customer upon delivery FOB
point of shipment.
17.2 The above notwithstanding, title to Software and underlying
intellectual property rights (i.e., patents, copyrights,
proprietary and confidential information, and know-how ) supplied
by Motorola shall remain with Motorola.
17.3 All equipment sold to Customer hereunder is new and Motorola will
provide any documents which may be reasonably requested by
Customer evidencing this fact.
17.4 During the term of this Agreement the parties shall indemnify and
hold harmless each other together with their directors, officers,
agents, employees, affiliates, parent corporations and
subsidiaries from any and all loss, damage, expense, judgment,
lien, suit, cause of action, demand or liability (collectively,
"loss") for personal injury (including death) and tangible
property damage which may be imposed on or incurred by one party
arising directly out of the intentional misconduct or negligent
acts or omissions of the other, its agents, subcontractors, or
employees during the performance of any work hereunder. The
indemnifying party shall, at its sole expense, defend any suit
based upon a claim or cause of action within the foregoing
indemnity provision and satisfy any judgment that may be rendered
against the other resulting therefrom, provided that the
indemnifying party shall be given (i) prompt notice of any such
claim or suit; and (ii) full opportunity to defend such claim or
suit; provided, however, that failure to provide such notice
shall not relieve the indemnifying party of liability under this
Section except to the extent the indemnifying party was
prejudiced thereby. The indemnified party may, at its election,
participate in the defense of any suit, and shall cooperate fully
in defending any claim or suits. The indemnifying party shall pay
all costs, expenses, and reasonable attorney's fees incurred by
the
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indemnified party in connection with any such suit or in
enforcing this indemnity provision.
Without limiting the foregoing paragraph, Customer shall
indemnify and hold harmless Motorola, its directors, officers,
agents, employees, affiliates and subsidiaries from any and all
loss, as defined in that paragraph, which is based upon or
alleged to arise from, any statement, representation, information
or other communication made by Customer, its officers, employees,
underwriters, or agents to offerees and purchasers of Customer
stock or other securities, including but not limited to any
statement, representation, information or other communication
concerning this Agreement, the iDEN System, Motorola or iDEN
systems or technology in general and including but not limited to
any loss arising under applicable securities laws. Customer shall
provide to Motorola advance copies of prospectuses and securities
and exchange commission filings in connection with an initial
public offering and other material filings, however, Motorola
shall have no responsibility to review them nor for the contents
thereof.
17.5 Customer and Motorola each shall be named as additional insured
under the other's comprehensive general liability policy for
claims arising out of work performed hereunder (which includes
but is not limited to product and public liability, property and
all risk insurance).
18.0 FORCE MAJEURE - EXCUSABLE DELAY
18.1 Neither party shall be liable for delays in delivery or
performance, or for failure to manufacture, deliver or perform
when caused by any of the following which are beyond the
reasonable control of the delayed party:
18.1.1 Acts of God, acts of the public enemy, acts or failures to
act by the other party, acts of civil or military
authority, governmental priorities and regulatory actions,
strikes or other labor disturbances, hurricanes,
earthquakes, fires, floods, epidemics, embargoes, war,
riots, delays in transportation not caused by the shipping
party, and loss or damage to goods in transit provided
such goods were packaged as described herein, or;
18.1.2 Inability on account of causes beyond the reasonable
control of the delayed party or its suppliers to obtain
necessary products, components, services, or facilities.
18.2 In the event of any such delay, the date of delivery or
performance shall be extended for a period equal to the period of
time lost by reason of the delay. If any such delay lasts for
more than one hundred eighty (180) days, the parties shall
consult with one another for the purpose of agreeing upon the
basis on which the
32
<PAGE>
delayed party shall resume work at the end of the delay. If no
reasonable solution to the delay is available, then either party
may, by written notice, cancel that portion of the Agreement
which is delayed, and adjust the Agreement price appropriately.
19.0 TERMINATION
19.1 Either party may terminate this Agreement without liability by
the giving of notice, in accordance with Section 24, if (i) the
other makes a general assignment for the benefit of creditors or
goes into compulsory or voluntary liquidation, (ii) if a petition
in bankruptcy or under any insolvency law is filed by or against
the other and such petition is not dismissed within sixty (60)
days after it has been filed, or (iii) the other shall commit any
material breach of its obligations hereunder.
In the case of any material breach, neither party shall terminate
this Agreement unless and until the other shall have failed to
cure such breach within ** after it shall have been served with a
notice, in accordance with Section 24, (i) stating the nature of
the breach, (ii) requiring that the breach be cured, and (iii)
stating its intention to terminate the Agreement if compliance
with the notice is not met.
19.2 The termination of this Agreement shall not affect or prejudice
any provisions of this Agreement which are expressly or by
implication provided to continue in effect after such
termination.
20.0 LIMITATION OF LIABILITY
Neither party, whether as a result of breach of Agreement, warranty,
tort (including without limitation negligence), patent infringement,
copyright infringement, or otherwise, shall have any liability for
incidental or consequential damages, including, but not limited to, loss
of profit or revenues, loss of use of the products or any associated
equipment, cost of capital, cost of substitute products, (except
replacement products under Sections 9 and 13), or downtime costs or
claims of third parties to the full extent such may be disclaimed by
law.
21.0 ASSIGNMENT - RESALE OF EQUIPMENT
21.1 The Agreement shall accrue to the benefit of and be binding upon
the parties hereto and any successor entity into which either
party shall have been merged or consolidated or to which either
party shall have sold or transferred all or substantially all its
assets. Specifically, Motorola may assign this Agreement,
provided that Motorola, Inc. shall remain liable for performance
hereunder. Customer may assign this Agreement to its parent
company or any wholly-owned
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
33
<PAGE>
subsidiary provided Customer remains obligated for the payments
set forth herein. Furthermore, Customer may assign this Agreement
to Nextel Communications or any of its wholly-owned subsidiaries.
This Agreement shall not be otherwise assigned by either party
without the prior written consent of the other party. In
conjunction with any agreed to assignment of this Agreement,
Motorola agrees to license the assignee pursuant to the terms set
forth in Exhibit "F". A reasonable new Software License Fee may
be required.
21.2 Notwithstanding anything to contrary elsewhere in this Agreement,
Customer may pledge, mortgage or otherwise assign all or any
portion of this Agreement or any orders hereunder (or any
combination thereof) to one or more providers of debt or equity
financing (provided any such intended assignee is not a person or
entity listed on the U.S. Department of Commerce Denied Parties
List or to a person or entity residing in a country to which
export of the iDEN equipment is prohibited under U.S. law) upon
terms and conditions satisfactory to Customer, provided that (i)
Customer will remain liable for all obligations arising out of
this Agreement, (ii) the assignee agrees in writing that the
terms and conditions of this Agreement shall apply to and be
binding upon the assignee to the same extent as Customer, to the
extent that the assignee is exercising any right under this
Agreement, (iii) in addition to any rights conferred on the
assignee, and Customer shall be treated as having placed the
order and paid for purchases for purposes of all rights and
benefits available to Customer under this Agreement.
21.3 Motorola retains the right to subcontract, in whole or in part,
any effort required to fulfill its obligations under this
Agreement, provided Motorola shall remain liable for performance
hereunder. Motorola shall provide Customer with a list of
intended subcontractors and use commercially reasonable efforts
to accommodate any objections Customer may have.
21.4 Any ** to a third party ** shall be subject to Motorola's
approval, which shall not be unreasonably withheld and shall
require **.
22.0 GOVERNING LAW
The validity, performance, and all matters relating to the effect of
this Agreement and any amendment hereto shall be governed by the laws of
state of Illinois without regard to its conflicts of laws provisions.
Venue for disputes shall be the Federal District Court for the District
of Delaware and the parties waive all objection to this venue.
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
34
<PAGE>
23.0 ORDER OF PRECEDENCE
In the event of an inconsistency in this Agreement, the inconsistency
shall be resolved by giving precedence in the following order:
23.1 This Agreement and duly executed Amendments or Change Orders to
this Agreement, with the latest Amendment or Change Order taking
precedence over earlier Amendments or Change Orders;
23.2 Exhibit "A" and all duly executed Amendments or Change Orders to
Exhibit "A";
23.3 Exhibit "F" and all duly executed Amendments to Exhibit "F";
23.4 All other Exhibits in alphabetical order and all duly executed
Amendments or Change Orders to said Exhibits.
24.0 NOTICE
24.1 Notices required to be given by one party to another shall be
deemed properly given if reduced to writing and personally
delivered or transmitted by recognized courier or overnight
delivery service, express mail, registered or certified post to
the address below, postage prepaid, or by facsimile with a
confirmation of transmission printed by sender's facsimile
machine, and shall be effective upon receipt if a Business Day,
or otherwise, on the next Business Day.
24.1.1 Motorola shall send notices as follows:
Nextel Partners Operating Corp.
4500 Carillon Pt.
Kirkland, WA 98033
Attention: Chief Technical Officer
Fax: 425-828-8098
with a copy to:
Nextel Partners, Inc.
4500 Carillon Pt.
Kirkland, WA 98033
Attention: General Counsel
Fax: 425-828-8098
35
<PAGE>
24.1.2 Customer shall send notices as follows:
Motorola, Inc.
iDEN Infrastructure Division
**
Attention: **
Fax #: **
With a copy to:
Motorola, Inc.
iDEN Infrastructure Division
**
Attention: **
FAX #: **
24.2 Either party may change the addresses for giving notice from time
to time by written instructions to the other of such change of
address.
25.0 SURVIVAL OF PROVISIONS
The parties agree that where the context of any provision indicates an
intent that it shall survive the term of this Agreement then it shall
survive.
26.0 COVENANT NOT TO SOLICIT EMPLOYMENT
The parties hereto agree that during the period of time beginning with
the execution of this Agreement and ending one year after the
termination hereof, neither party shall, without the consent of the
other party, solicit any employee of the other involved in providing
engineering, installation, integration, maintenance, and/or warranty
service for the iDEN System to encourage such employee to work for the
other. If, at any time, this provision is found to be overly broad under
the laws of an applicable jurisdiction, this provision shall be modified
as necessary to conform to such laws rather than be stricken herefrom.
27.0 GENERAL
Failure or delay on the part of Motorola or Customer to exercise any
right, power, or privilege hereunder shall not operate as a waiver. If
any provision of this Agreement is contrary to, prohibited by or held
invalid by any law, rule, order, or regulation of any government or by
the final determination of any state or federal court, such invalidity
shall not affect the enforceability of any other provisions not held to
be invalid to the extent such remaining provisions provide the parties
the benefits reasonably contemplated
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
36
<PAGE>
by this Agreement when taken as a whole. Section and paragraph headings
used in this Agreement are for convenience only and are not to be used
to construe the provisions of this Agreement.
28.0 AUTHORITY
Each party hereto represents and warrants that:
28.1 It has obtained all necessary approvals, consents and
authorizations of third parties and governmental authorities to
enter into this Agreement and has obtained or will obtain all
necessary approvals, consents and authorizations of third parties
and governmental authorities to perform and carry out its
obligations hereunder;
28.2 The persons executing this Agreement on its behalf have express
authority to do so, and, in so doing, to bind the party thereto;
28.3 The execution, delivery, and performance of this Agreement does
not violate any provision of any bylaw, charter, regulation, or
any other governing authority of the party; and;
28.4 The execution, delivery, and performance of this Agreement has
been duly authorized by all necessary partnership or corporate
action and this Agreement is a valid and binding obligation of
such party, enforceable in accordance with its terms.
29.0 TERM
The term of this Agreement shall be for ** from the Effective
Date. Provided, however, that if ** of this Agreement, Motorola and
Customer shall **.
30.0 RE-EXPORTATION OF TECHNICAL DATA OR PRODUCTS
Customer understands that all equipment, proprietary data, know-how,
Software, or other data or information obtained by Customer from
Motorola is considered to be United States technology and is licensed
for export and re-export by the United States Government. Customer
therefore agrees that it will not, without the prior written consent of
Motorola and the Office of Export Control, United States Department of
Commerce, Washington, DC 20230, USA, knowingly export, re-export, or
cause to be exported or re-exported, either directly or indirectly, any
such equipment, proprietary data, know-how, Software, or other data or
information, or any direct or indirect product thereof, to any
destination prohibited or restricted under United States law. Customer
understands that the list of prohibited or restricted destinations may
be amended from time to time by the
- ---------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
37
<PAGE>
United States Department of Commerce and that all such amendments shall
be applicable to this Agreement.
31.0 DISPUTES AND DISPUTE RESOLUTION
Motorola and Customer will attempt to settle any claim or controversy
arising out of this Agreement through consultation and negotiation in
good faith and a spirit of mutual cooperation. If those attempts fail,
then, except for disputes related to alleged patent, copyright, or
trademark infringement, the dispute will be mediated by a mutually
acceptable mediator to be chosen by Motorola and Customer within thirty
(30) days after written notice by the other demanding mediation. Neither
party may unreasonably withhold consent to the selection of a mediator,
and Motorola and Customer will share the costs of the mediation equally.
Venue for mediation shall be in a location within the United States that
is mutually convenient and acceptable to the parties. By mutual
agreement, however, the parties may postpone mediation until they have
each completed some specified but limited discovery about the dispute.
The parties may also agree to replace mediation with some other form of
alternative dispute resolution (ADR), such as neutral fact-finding or a
mini-trial.
Any dispute which the parties cannot resolve through negotiation,
mediation, or other form of ADR within four (4) months of the date of
the initial demand for it may then be submitted to the Federal District
Court for the District of Delaware for resolution. The use of any ADR
procedures will not be construed under the doctrines of latches, waiver,
or estoppel to affect adversely the rights of either party. And nothing
in this section will prevent either party from resorting to judicial
proceedings if (a) good faith efforts to resolve the dispute under these
procedures have been unsuccessful or (b) interim relief from a court is
necessary to prevent serious and irreparable injury to one party or to
others.
32.0 GOVERNMENT CONTRACTS
In the event that Customer elects to provide goods or services to a
Governmental Entity (defined herein), Customer does so solely at its
option and risk and agrees not to obligate Motorola as a subcontractor
or otherwise to such Governmental Entity. Customer remains solely and
exclusively responsible for compliance with all statutes, regulations,
and provisions governing sales to such entity. Motorola makes no
representations, certifications, or warranties whatsoever with respect
to the ability of its goods, services, or prices to satisfy any statues,
regulations, or provisions governing sales of goods or services to such
Governmental Entity. The term "Governmental Entity" as used above
includes any U.S. federal, state, or local government, agency, or
instrumentality as well as any non-U.S. government, agency, or
instrumentality.
38
<PAGE>
33.0 SEVERABILITY
In the event that any one or more of the provisions contained in the
Agreement or in any of the Exhibits hereto should be determined to be
invalid, illegal, or unenforceable in any respect, the validity,
legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired. The parties shall endeavor in good
faith to replace any invalid, illegal, or unenforceable provision with a
valid provision, the economic effect of which comes as close as possible
to that of the invalid, illegal, or unenforceable provision.
34.0 ENTIRE AGREEMENT
This Agreement and the Exhibits hereto constitute the entire
understanding between the parties concerning the subject matter hereof
and supersede all prior discussions, agreements, and representations,
whether oral or written, and whether or not executed by Motorola and
Customer. No modification, Amendment, Change Order, or other change may
be made to this Agreement or any Exhibit unless reduced to writing and
executed by authorized representatives of both parties.
The terms and conditions of this Agreement shall prevail notwithstanding
any variance with the terms and conditions of any order submitted by
Customer following execution of this Agreement. In no event shall the
preprinted terms and conditions found on any Customer purchase order,
acknowledgment, or other form be considered an Amendment, or
modification of this Agreement. Such preprinted terms and conditions
shall be null and void and of no force and effect, provided, however,
additional purchase orders in the form of Exhibit "A" shall be valid and
enforceable when signed by both parties.
35.0 COUNTERPARTS
This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original and all of which taken together shall
constitute one and the same instrument.
[Remainder of page left blank intentionally.]
39
<PAGE>
36.0 COMMENCEMENT OF WORK
Motorola's obligations to commence work hereunder shall begin upon the
date which Motorola receives the down payment as stipulated in Section
7.2.1, or to the extent that no downpayment is required, on the date
that Customer orders any service or equipment hereunder. All time
periods for completion of Motorola's obligations shall commence on such
date.
THIS AGREEMENT IS EFFECTIVE AS OF THE 29TH DAY OF JANUARY, 1999
("EFFECTIVE DATE").
MOTOROLA, INC. NEXTEL PARTNERS OPERATING CORP.
By: /s/ Charles F. Wright By: /s/ Donald J. Manning
-------------------------------- -------------------------------
(Authorized Signatory) (Authorized Signatory)
Name Charles F. Wright Name Donald J. Manning
-------------------------------- -------------------------------
Title: Corporate VP and General Manager Title: V.P. General Counsel
-------------------------------- -------------------------------
40
<PAGE>
SUBSCRIBER PURCHASE AND DISTRIBUTION AGREEMENT
BETWEEN
MOTOROLA, INC.
AND
NEXTEL PARTNERS OPERATING CORP.
This Subscriber Purchase and Distribution Agreement ("AGREEMENT") is
entered into between Motorola, Inc., a Delaware corporation, by and through its
iDEN Subscriber Division, having a principal place of business at 800 West
Sunrise Boulevard, Ft. Lauderdale, Florida 33322 ("MOTOROLA") and Nextel
PARTNERS OPERATING Corp., a Delaware corporation, with offices at 4500 Carillon
Point Kirkland, Washington 98033 ("PARTNERS").
Whereas MOTOROLA is in the business of designing and manufacturing wireless
communication devices.
Whereas MOTOROLA has designed an integrated wireless digital communication
technology which technology is available under the trademark of iDEN(R)
("iDEN").
Whereas MOTOROLA has developed handheld and mobile wireless devices for
general release ("iDEN SUBSCRIBER EQUIPMENT") and will make such products
available to PARTNERS under the terms and conditions contained herein.
Whereas PARTNERS has been formed to build and operate iDEN networks
("NETWORK") in certain metropolitan rural markets throughout the United States
as listed in Exhibit A ("PARTNERS MARKET") using certain blocks of wireless
licenses from Nextel Communications Inc. ("NEXTEL").
Whereas PARTNERS has agreed to purchase infrastructure equipment ("FNE")
from MOTOROLA to support the NETWORK, pursuant to a separate agreement.
Whereas PARTNERS will purchase iDEN SUBSCRIBER EQUIPMENT for operation on
the NETWORK from MOTOROLA under the terms and conditions contained herein.
Definitions have been capitalized and shall have the same meaning
throughout this AGREEMENT.
1. PRODUCT COMPLIANCE
iDEN SUBSCRIBER EQUIPMENT shall be existing iDEN subscriber products
commercially available as of the Effective Date and shall comply with their
applicable technical specifications, marketing literature, and user guides,
in all material respects.
<PAGE>
2. PRICE
2.1. Prices
The prices to PARTNERS, in US dollars, for all iDEN SUBSCRIBER EQUIPMENT
and accessories will be the same as the price paid by NEXTEL to MOTOROLA,
from time to time on a per unit basis plus * *. Under no circumstances will
PARTNERS' price be * *. Specifically excluded from this provision are:
a) * * without * * such as that contained within * * of this AGREEMENT
unless * * with respect to such units.
b) Those * * which was * * or any * * MOTOROLA.
c) * *, on a case by case basis, such as * * outside the scope of the * *
that are not * *.
d) If * * in the * * MOTOROLA in * *, MOTOROLA shall * *.
2.2. Payment Terms
All deliveries are FOB a * * facility located within the U.S. Each such
delivery will be separately invoiced. Payment from PARTNERS shall be due
within * * after shipment and made pursuant to Section 5.1.4. Title to the
iDEN SUBSCRIBER EQUIPMENT and risk of loss shall pass to PARTNERS at the
FOB point which shall be a * * facility within the U.S. PARTNERS shall pay
all * * pursuant to Section 5.6.
Should PARTNERS fail * * times in a * * period to remit a payment within *
* from the date of a shipment, MOTOROLA may require payment for * * .
3. DISTRIBUTORSHIP
3.1. MOTOROLA Trade Names, Trademarks, and Service Marks
3.1.1. PARTNERS acknowledges that the word "MOTOROLA" is the dominant
feature of the trade names of MOTOROLA and its subsidiaries
and affiliated companies which use MOTOROLA in such names
and the mark "MOTOROLA", WINGS, stylized "M" within a circle
and derivatives thereof are important trademarks for
products manufactured or sold by MOTOROLA and for services
provided in connection with such products.
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
3.1.2. PARTNERS agrees that it will not in any manner use the MOTOROLA
trade names, trademarks, or service marks, or any limitation
or variant thereof as part of PARTNERS' trade name or
company or firm name, nor will it grant or purport to grant
such use to any subsidiary or affiliate of PARTNERS or to
any agent or representative of PARTNERS.
3.1.3. PARTNERS shall not remove, alter, or obliterate any trademark
appearing on the iDEN SUBSCRIBER EQUIPMENT, and PARTNERS
shall not have the right to use any MOTOROLA originated
trademark on any product, or in any advertising or sale
promotion except as such use or the manner of such use is
authorized by this AGREEMENT or separately authorized by
MOTOROLA in writing. PARTNERS shall not publish, cause to be
published, encourage, or approve any advertising or practice
which might mislead or deceive the public or might be
detrimental to the good name, trademark, trade name, service
mark, goodwill, or reputation of MOTOROLA. PARTNERS shall
discontinue any such advertising, practice, or use deemed by
MOTOROLA to have such misleading, deceptive, or detrimental
effect.
3.1.4. Without the prior written consent of MOTOROLA, PARTNERS shall
not have the right to institute proceedings for infringement
of any trademark of MOTOROLA which it is permitted to use
under this AGREEMENT or to institute proceedings against a
competitor for unfair competition on improper use of such
trademarks or incur any cost or obligations on behalf of
MOTOROLA.
3.1.5. If PARTNERS intends to use MOTOROLA's name, trademark or any
logo thereof, PARTNERS shall distribute to MOTOROLA
specimens or photographs of any medium on which they appear.
This includes, but is not limited to, PARTNERS' letterhead,
business cards, telephone directory listing, truck markings,
and business establishment signs and advertising materials
for approval of the form thereof by MOTOROLA, which approval
shall not be unreasonably withheld or delayed, and PARTNERS
will follow MOTOROLA's specifications with respect thereto.
3.1.6. PARTNERS' rights to use any MOTOROLA trademark, tradename, or
service mark as stated herein, shall terminate upon termination
of this AGREEMENT unless use thereof is permitted by other
agreements.
3.1.7. PARTNERS agrees that violation of any provision as stated
herein shall constitute just cause for immediate termination
of this AGREEMENT.
<PAGE>
3.2. Training
PARTNERS will implement a Training Program on the iDEN SUBSCRIBER
EQUIPMENT and the iDEN System to the distribution channel.
3.3. Cooperative Advertising Policy
MOTOROLA shall provide PARTNERS a cooperative advertising program
as described in Attachment A of this AGREEMENT.
3.4. Parry Relationship
This AGREEMENT does not create any agency, joint venture or
partnership between PARTNERS and MOTOROLA, and PARTNERS shall not
impose or create any obligation or responsibility, express or
implied, or make any promises, representations, or warranties on
behalf of MOTOROLA, other than as expressly provided herein.
3.5. Client Care
PARTNERS will implement/install or include a customer care
process, or other assistance procedures, for End Users to be able
to obtain help and information regarding the iDEN system or iDEN
SUBSCRIBER EQUIPMENT.
3.6. Technical Assistance
MOTOROLA's warranty shall not be enlarged, and no obligation or
liability shall arise out of MOTOROLA's rendering of technical
advise, facilities, or service in connection with PARTNERS'
purchase of the iDEN SUBSCRIBER EQUIPMENT furnished under this
AGREEMENT.
3.8. ** Limitation
Distribution of iDEN SUBSCRIBER EQUIPMENT is ** as such ** may be
**. There is to be **. PARTNERS agrees to incorporate this **
provision into its ** as a condition of sale, i.e. **.
5 Logistics
5.1. Orders/acceptances/shipment/delivery
5.1.1 Orders
All orders shall be only upon the terms and conditions of
this AGREEMENT. The only effect of any terms and conditions
in PARTNERS' orders, or
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
<PAGE>
elsewhere shall be to request the time and place of
delivery, and numbers of units to be delivered, subject to
MOTOROLA's acceptance, but they shall not change, alter, or
add to the terms and conditions of this AGREEMENT in any
other way.
All orders placed by PARTNERS pursuant to this AGREEMENT
must meet the following minimum requirements:
i. iDEN SUBSCRIBER EQUIPMENT shall be for at least * *
units per requested delivery location.
ii. Order for iDEN SUBSCRIBER EQUIPMENT accessories only
shall be for at least * * per requested delivery
location.
PARTNERS shall submit orders pursuant to the following
format:
a. iDEN SUBSCRIBER EQUIPMENT and accessories must be
listed as main line items.
b. Options must be listed as sub-items to the main line
item to which they apply.
c. Options must be ordered in the same quantity as the
corresponding main line item.
d. "Bill to" and "Ship To" must be included.
PARTNERS shall submit orders by mailing or transmitting via
facsimile to:
Motorola Inc.
* *
Attention:
* *
Fax: * *
Phone: * *
PARTNERS may change orders already submitted to MOTOROLA
only if such change requests are received by MOTOROLA in
writing no later than * * prior to such order's scheduled
ship date.
5.1.2 Order Acknowledgment
MOTOROLA shall acknowledge receipt of order and provide
scheduled ship date within * * after receipt. Should
MOTOROLA, acting in good faith, not find an order
acceptable, MOTOROLA shall, with reasonable
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
specificity and clarity, communicate such to PARTNERS within
the associated receipt notification.
5.1.3 Packing and Shipment
a) MOTOROLA shall use commercially reasonable efforts to
ship iDEN SUBSCRIBER EQUIPMENT purchased pursuant to
this AGREEMENT within * * after receipt of a purchase
order acceptable to MOTOROLA.
b) PARTNERS shall elect the carrier and notify MOTOROLA in
writing. If no carrier is so selected, MOTOROLA shall
ship via whatever way MOTOROLA deems best.
c) MOTOROLA shall provide all relevant documents and
cooperate with the carrier in the shipment of iDEN
SUBSCRIBER AGREEMENT.
d) MOTOROLA shall package all iDEN SUBSCRIBER EQUIPMENT in
a commercially reasonable manner to prevent damage to
such equipment during shipment.
5.1.4 Wire Transfer Terms
Wire transfers shall be made to the following address:
* *
Routing No: * *
Account No: * *
Address: * *
5.3. Purchase Forecasts
During the term of this AGREEMENT, PARTNERS shall use reasonable
efforts to update, on a quarterly basis, a continuous usage
forecast to assist MOTOROLA in maintaining an orderly production
flow for the purpose of meeting PARTNERS' delivery requirements.
5.5. Standard Product Offerings
5.5.1 Product Availability
MOTOROLA shall make available to PARTNERS, for purchase, all
available iDEN SUBSCRIBER EQUIPMENT. Except as provided for
in Section 2.1(d), specifically excluded from this provision
are those iDEN
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
SUBSCRIBER EQUIPMENT the development of which was
substantially funded by a MOTOROLA customer or group
thereof.
5.5.2 Standard Packages
- -------------------------------------------------------------------------------
STANDARD PHONE HARDWARE
- -------------------------------------------------------------------------------
* *
- -------------------------------------------------------------------------------
STANDARD MOBILE HARDWARE
- -------------------------------------------------------------------------------
* *
- -------------------------------------------------------------------------------
5.5.3. Optional Subscriber Hardware
Any equipment not explicitly included in the unit pricing,
shall be considered an option. Such options shall be
available to PARTNERS pursuant to MOTOROLA's then current
terms and conditions, subject to Section 2.
- --------------------------------------------------------------------------------
PORTABLE OPTIONAL HARDWARE
- --------------------------------------------------------------------------------
* *
- --------------------------------------------------------------------------------
MOBILE OPTIONAL HARDWARE
- --------------------------------------------------------------------------------
* *
- --------------------------------------------------------------------------------
5.5.4. Product Changes or Substitutions
At any time during its performance of this AGREEMENT,
MOTOROLA may implement changes in the products set forth
herein that have been ordered by PARTNERS but not shipped,
modify the drawings and specifications relating thereto, or
substitute therefor products of more recent design;
provided, however, that any such changes, modifications or
substitutions, under normal and proper use:
a. Shall not materially or adversely affect physical or
functional interchangeability or performance (except
where there is written agreement between the parties
that the change can be made after PARTNERS knows the
effect thereof);
b. Shall not detract from the safety of the product;
c. Shall be at no additional cost to PARTNERS; and
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
MOTOROLA will notify PARTNERS via its normal Product
and/or Manual releases process of changes that are made to
the product and released to the general customer base and
its use and effect on the equipment currently in the field.
5.6. Taxes and Other Costs
Except for * *, all * * applicable to this transaction, shall be
borne by PARTNERS. Upon MOTOROLA's written request, PARTNERS
shall produce sufficient evidence within * * to prove that
PARTNERS has fulfilled its obligation relating to all such taxes.
If, after this * * period, any such taxes are determined to be
applicable to this transaction and notwithstanding PARTNERS'
responsibility, MOTOROLA is required to pay or bear the burden
thereof, then the prices set forth herein shall be increased by
the amount of such taxes and any interest or penalty thereon and
PARTNERS shall pay to MOTOROLA the full amount of any such
increase no later than * * after receipt of an invoice therefor.
The prices set forth herein also exclude * *.
7. TERM
The term ("Term") of this AGREEMENT shall be for * * from the EFFECTIVE
DATE. At the end of which, this AGREEMENT will automatically extend for
additional * * terms, subject to the parties right to terminate this
AGREEMENT.
After the * * Term of this AGREEMENT, either party may terminate this
AGREEMENT by giving the other party * * notice of intent to terminate.
8. UNIT VOLUME
To qualify for the pricing in section 2 above, Customer agrees to purchase
the minimum quantities of iDEN SUBSCRIBER EQUIPMENT according to the
following table.
TIME PERIOD MINIMUM QUANTITY OF iDEN
SUBSCRIBER EQUIPMENT
* * * *
* * * *
* * * *
* * * *
9. WARRANTY
MOTOROLA WARRANTS GOODS SOLD PURSUANT TO THIS AGREEMENT IN ACCORDANCE WITH
ITS LIMITED WARRANTY PROVIDED WITH iDEN SUBSCRIBER EQUIPMENT. MOTOROLA
MAKES NO REPRESENTATION OR WARRANTY OF ANY OTHER KIND, EXPRESS OR IMPLIED,
WHICH ARE
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
SPECIFICALLY EXCLUDED INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
* *
10. WAIVER
The failure of either party to insist in any one or more instances upon the
performance of any of the terms, covenants, or conditions, herein, or to
exercise any right hereunder, shall not be construed as a waiver or
relinquishment of the future performance of any such term, covenant, or
conditions of the future exercise of such right, but the obligation of the
other party with respect to such future performance shall continue in full
force and effect.
11. RE-EXPORTATION OF TECHNICAL DATA OR PRODUCTS
PARTNERS understands that all equipment, proprietary data, know-how,
Software or other data or information obtained by PARTNERS from MOTOROLA is
considered to be United States technology. PARTNERS therefore agrees that
it will not, without prior written consent of MOTOROLA and the Office of
Export Control, United States Department of Commerce, Washington, DC 20230,
U.S.A., knowingly export, re-export, or cause to be exported or
re-exported, either directly or indirectly, any such equipment, proprietary
data, know-how, software, or other data or information, or any direct or
indirect product thereof, to any destination or entity prohibited or
restricted under United States law. PARTNERS understands that the list of
prohibited or restricted destinations and entities may be amended from time
to time by the United States Department of Commerce and that all such
amendments shall be applicable to this AGREEMENT.
12. DISCLAIMER OF INTELLECTUAL PROPERTY LICENSE
Nothing contained in this AGREEMENT shall be deemed to grant, either
directly or by implication, any license under any patents, patent
applications, copyrights, trademarks, or trade secrets of MOTOROLA except
that PARTNERS shall have the normal non-exclusive, royalty-free license to
use which is implied, or otherwise arises by operation of law, in the sale
of a product.
13. PATENT AND COPYRIGHT INDEMNITY
13.1 MOTOROLA shall defend PARTNERS against a claim that MOTOROLA
manufactured iDEN(R) SUBSCRIBER EQUIPMENT infringes a U.S. patent,
provided that:
a. PARTNERS promptly notifies MOTOROLA in writing of the claim.
b. MOTOROLA has sole control of the defense and all related
settlement negotiations.
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
c. PARTNERS gives MOTOROLA information and, at MOTOROLA's expense,
assistance, for the defense provided, however, that partners'
failure to provide such notice shall not relieve MOTOROLA of
liability under this Section 13 except to the extent MOTOROLA was
prejudiced thereby.
13.2 Subject to the conditions and limitations of liability stated in this
AGREEMENT, MOTOROLA shall indemnify and hold PARTNERS harmless from:
a. All payments which by final judgments in such suits may be
assessed against PARTNERS on account of such infringement and
shall pay resulting settlements, costs and damages finally
awarded against PARTNERS by a court of law; and
b. All costs associated with promptly notifying MOTOROLA of the
claim.
13.3 PARTNERS agrees that if MOTOROLA manufactured products become, or in
MOTOROLA's opinion are likely to become, the subject of such a claim,
PARTNERS will permit MOTOROLA, at its option and expense, either:
a. To ** PARTNERS to **, or
b. To replace or modify same so that they become non-infringing
without affecting the function and capability.
If both of the foregoing alternatives are not available on terms which
are reasonable in both PARTNERS' and MOTOROLA's judgment, PARTNERS can
return MOTOROLA manufactured products for full credit on the entire
unusable portion thereof.
13.4 MOTOROLA has no liability for any claim of patent or copyright
infringement to the extent based upon adherence to specifications,
designs or instructions furnished by PARTNERS, nor for any claim based
upon the combination, operation or use of any MOTOROLA manufactured
products or Software supplied hereunder with products, Software or
data not supplied by MOTOROLA, nor for any claim to the extent based
upon alteration of the products or modification of any Software
supplied by entities other than MOTOROLA.
14. CONFIDENTIALITY
14.1 During the term of this AGREEMENT, PARTNERS and MOTOROLA may deem it
necessary to provide each other with Confidential Information. For a
period not less than three (3) years from the date of disclosure, the
parties agree:
14.1.1 To maintain the confidentiality of such Confidential
Information and not disclose same to any third party, except
as authorized by the original disclosing
<PAGE>
party in writing, or as required by a court of competent
jurisdiction or as required by an appropriately empowered
government agency, provided however that the receiving party
shall promptly notify the disclosing party of such
requirement so that the disclosing party may seek a
protective order or other appropriate remedy against such
disclosure. For any such information that MOTOROLA and
PARTNERS believes is confidential, if applicable, MOTOROLA
and PARTNERS will use their best efforts to get confidential
treatment from the SEC. Such Confidential information also
includes oral and visual Confidential Information.
14.1.2. To restrict disclosure of Confideal Information to
employees and technical, legal and financial consultants
who have a "need to know." Such Confidential Information
shall be handled with the same degree of care which the
receiving party applies to its own Confidential Information
but in no event less than reasonable care.
14.1.3. To take precautions necessary and appropriate to guard the
confidentiality of Confidential Information, including
informing its employees and consultants who handle such
Confidential Information that it is confidential and not to
be disclosed to others and as to all technical consultants
obtain a signed Non-Disclosure Agreement consistent herewith
prior to any disclosure.
14.1.4. That Confidential Information is and shall at all times remain
the property of the disclosing party. No use of any
Confidential Information is permitted except as otherwise
provided herein and no grant under any proprietary rights is
hereby given or intended, including any license implied or
otherwise.
14.1.5. To use such Confidential Information only as required in
performance of this AGREEMENT.
14.2. Except as may be required by applicable law, neither party shall
disclose to any third party the contents of this AGREEMENT, the
Exhibits or any Amendments hereto or thereto for a period of two (2)
years from the EFFECTIVE DATE without the prior written consent of
the other; provided, however, PARTNERS may disclose this Agreement
and all Exhibits and Amendments hereto to NEXTEL.
15. TITLE AND INDEMNITY
15.1 Title to Software and underlying intellectual property rights (i.e.
patents, copyrights, proprietary and confidential information, and
know-how) shall at all times remain with MOTOROLA.
15.2 During the term of this AGREEMENT, the parties shall indemnify and
hold harmless each other together with other officers, agents and
employees from any and all loss, damage, expense, judgment, lien,
suit, cause of action, demand or liability for personal
<PAGE>
injury, including death and tangible property damage (collectively
loss), which may be imposed on or incurred by one party arising
directly out of the negligent acts or omissions of the other, its
agents, subcontractors, or employees during the performance of any
work hereunder. The indemnifying party shall, at its sole expense,
defend any suit based upon a claim or cause of action within the
foregoing indemnity provision and satisfy any judgment that may be
rendered against the other resulting therefrom, provided that the
indemnifying party shall be given:
a. Prompt notice of any such claim or suit provided, however, that
failure to provide such notice shall not relieve the indemnifying
party of liability under this section except to the extent the
indemnifying party was prejudiced thereby; and
b. Full opportunity to defend such suit.
The indemnified party may, at its election, participate in the defense
of any suit, and shall cooperate fully in defending any claim or
suits.
16. FORCE MAJEURE - EXCUSABLE DELAY
16.1 Neither party shall be liable for delays in delivery or performance,
or for failure to manufacture, deliver or perform when such delay or
failure is caused by any of the following which are beyond the actual
control of the delayed party:
16.1.1 Acts of God, acts of the public enemy, acts or failures to act
by the other party, acts of civil or military authority,
governmental priorities, strikes or other labor disturbances,
hurricanes, earthquakes, fires, floods, epidemics, embargoes,
war, riots, delays in transportation, car shortages, and loss
or damage to goods in transit if such goods have been properly
packaged as stated herein; or
16.1.2 Inability on account of causes beyond the reasonable control of
the delayed party or its suppliers to obtain necessary
products, components, services or facilities.
16.2 In the event of any such delay the date of delivery or of performance
shall be extended for a period equal to the period of time lost by
reason of the delay.
17. TERMINATION
17.1 Either party may terminate this AGREEMENT without liability by written
or telegraphic notice if the other shall commit any material breach of
its obligations hereunder provided, however, that in the case of any
such breach which is capable of being cured, neither party shall
terminate this AGREEMENT unless and until the other shall have failed
to make good such breach within * * after it shall have been
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
served with a notice requiring that such breach be made good and
stating its intention to terminate the AGREEMENT if compliance with
the notice is not met.
17.2 The termination of this AGREEMENT shall not affect or prejudice any
provisions of this AGREEMENT which are expressly or by implication
provided to continue in effect after such termination.
18. LIMITATION OF LIABILITY AND INSURANCE
Except as specifically provided herein, neither party, whether as a result
of breach of contract, warranty, tort (including without limitation
negligence), patent infringement, copyright infringement or otherwise,
shall have any liability to the other for incidental or consequential
damages, including, but not limited to, loss of profit or revenues, loss of
use of the products or any associated equipment, cost of capital, cost of
substitute products, facilities or service, or downtime costs or claims of
third parties (except as otherwise indemnified herein).
19. ASSIGNMENT
The AGREEMENT shall accrue to the benefit of and be binding upon the
parties hereto and any successor entity into which either party shall have
been merged or consolidated or to which either party shall have sold or
transferred all or substantially all its assets but it shall not be
otherwise assigned by either party without the prior written consent of the
other party. There shall be no assignment of any Software license given
hereunder.
20. GOVERNING LAW
The validity, performance, and all matters relating to the effect of this
AGREEMENT and any amendment hereto shall be governed by the laws of the
state of Illinois without regard to its conflicts of laws provisions.
21. ORDER OF PRECEDENCE
In the event of an inconsistency in this AGREEMENT, the inconsistency shall
be resolved by giving precedence in the following order:
21.1 This AGREEMENT and duly executed Amendments or Change Orders to this
AGREEMENT, with the latest Amendment or Change Order taking
precedence over earlier Amendments or Change Orders;
21.2. All other Exhibits and all duly executed Amendments or Change Orders
to said Exhibits.
<PAGE>
22. NOTICE
22.1 Notices required to be given by one party to another shall be deemed
properly given if reduced to writing and personally delivered or
transmitted by registered or certified post to the address below,
postage prepaid, or by facsimile with a confirmation of transmission
printed by sender's facsimile machine, and shall be effective upon
receipt.
22.1.1 MOTOROLA shall send notices as follows:
Nextel Partners Operating Corp.
4500 Carillon Point
Kirkland, Washington 98033
Attention: General Manager
Fax: (425) 828-8098
With a copy to:
---------------
Nextel Partners Operating Corp.
4500 Carillon Point
Kirkland, Washington 98033
Attention: General Counsel
Fax (954) 723-5050
22.1.2 PARTNERS shall send notices as follows:
MOTOROLA, Inc.
iDEN Subscriber Division
* *
Attention: * *
Fax: * *
With a copy to:
---------------
MOTOROLA , Inc.
Intellectual Property Section
Law Department
* *
Attention: * *
Fax: * *
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406 under
the Securities Act of 1933, as amended.
<PAGE>
22.2. Either party may change the addresses for giving notice from time to
time by written instructions to the other of such change of address.
23. SURVIVAL OF PROVISIONS
The parties agree that where the context of any provision indicates an
intent that it shall survive the term of this AGREEMENT then such provision
shall survive.
24. GENERAL
Failure or delay on the part of MOTOROLA or PARTNERS to exercise any right,
power or privilege hereunder shall not operate as a waiver thereof. If any
provision of this AGREEMENT is contrary to, prohibited by or held invalid
by any law, rule, order or regulation of any government or by the final
determination of any provincial or federal court, such invalidity shall not
affect the enforceability of any other provisions not held to be invalid.
Section and paragraph heading used in this AGREEMENT are for convenience
only and are not to be used to construe the provisions of their AGREEMENT.
Neither party shall bring any action, either in law or in equity, more than
one year from the date the event giving rise to the action becomes known to
the party bringing the action.
25. AUTHORITY
Each party hereto represents and warrants that:
a. It has obtained all necessary approvals, consents and authorizations
of third parties and governmental authorities to enter into this
AGREEMENT and to perform and carry out its obligations hereunder;
b. The persons executing this AGREEMENT on its behalf have express
authority to do so, and, in so doing, to bind the party thereto;
c. The execution, delivery, and performance of this AGREEMENT does not
violate any provision of any bylaw, charter, regulation, or any other
governing authority of the party; and
d. The execution, delivery and performance of this AGREEMENT has been
duly authorized by all necessary partnership or corporate action and
this AGREEMENT is a valid and binding obligation of such party,
enforceable in accordance with its terms.
26. DISPUTES AND DISPUTE RESOLUTION
26.1. MOTOROLA and PARTNERS will attempt to settle any claim or controversy
arising out of this AGREEMENT through consultation and negotiation in
good faith and a spirit of mutual cooperation. If those attempts
fail, then the dispute will be mediated by a mutually-acceptable
mediator to be chosen by MOTOROLA and PARTNERS within
<PAGE>
** after written notice by the other demanding mediation. Neither
party may unreasonably withhold consent to the selection of a
mediator, and MOTOROLA and PARTNERS will share the costs of the
mediation equally. By mutual agreement, however, the parties may
postpone mediation until they have each completed some specified, but
limited discovery about the dispute. The parties may also agree to
replace mediation with some other form of alternative dispute
resolution (ADR), such as neutral fact-finding or a mini-trial.
27. MISCELLANEOUS
This AGREEMENT constitutes the entire and final expression of agreement
between the parties pertaining to the subject matter hereof and supersedes all
prior and contemporaneous negotiations, offers, discussions, arrangements,
promises, representations, agreements, letters of intent or understanding of the
parties whether written, oral or otherwise, in connection therewith.
IN WITNESS WHEREOF, the parties have caused this AGREEMENT to be executed
by their duly authorized representatives effective as of the date of the last
signature hereto ("Effective Date").
MOTOROLA, INC. NEXTEL PARTNERS
OPERATING CORP.
By: /s/ Samir Desai By: /s/ Donald J. Manning
------------------------------------- ----------------------------
(Authorized Signatory) (Authorized Signatory)
Name: Samir Desai Name: Donald J. Manning
----------------------------------- --------------------------
Senior Vice President, General
Title: Manager iDEN Subscriber Group Title: V.P. General Counsel
---------------------------------- -------------------------
Date: 1/28/99 Date: 1/29/99
----------------------------------- --------------------------
** Confidential portions omitted and filed separately with the Commission
pursuant to an application for confidential treatment pursuant to Rule 406
under the Securities Act of 1933, as amended.
<PAGE>
CONFORMED COPY
SUBSCRIPTION AND CONTRIBUTION AGREEMENT
dated as of
January 29, 1999
among
NEXTEL PARTNERS, INC.,
and
THE BUYERS NAMED HEREIN
relating to the purchase and sale
of
Common Stock,
Series A Convertible Preferred Stock,
Series B Preferred Stock,
Series C Convertible Preferred Stock,
Series D Convertible Preferred Stock,
and
Warrants
of
Nextel Partners, Inc.
<PAGE>
TABLE OF CONTENTS
-----------------------
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions....................................................2
ARTICLE 2
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale..............................................5
SECTION 2.02. Closing........................................................6
SECTION 2.03. Subsequent Payments............................................6
SECTION 2.04. Remedies.......................................................8
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER
SECTION 3.01. Corporate Existence and Power..................................9
SECTION 3.02. Corporate Authorization........................................9
SECTION 3.03. Governmental Authorization.....................................9
SECTION 3.04. Noncontravention...............................................9
SECTION 3.05. Capitalization and Voting Rights..............................10
SECTION 3.06. Valid Issuance of Securities..................................11
SECTION 3.07. Litigation....................................................11
SECTION 3.08. Newly Formed Corporation......................................11
SECTION 3.09. Representations of Buyers.....................................11
SECTION 3.10. Use of Proceeds...............................................12
SECTION 3.11. Corporate Documents...........................................12
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYERS
SECTION 4.01. Existence and Power...........................................12
SECTION 4.02. Authorization.................................................12
SECTION 4.03. Governmental Authorization....................................13
SECTION 4.04. Noncontravention..............................................13
SECTION 4.05. Purchase for Investment.......................................13
SECTION 4.06. Private Placement.............................................13
SECTION 4.07. Litigation....................................................15
SECTION 4.08. Brokers or Finders' Fees......................................15
<PAGE>
SECTION 4.09. Capital of DLJMB..............................................15
SECTION 4.10. Capital Commitment............................................15
SECTION 4.11. FCC Compliance; NWIP FCC Licenses.............................15
SECTION 4.12. Newly Formed Corporation......................................16
ARTICLE 5
CONDITIONS TO CLOSING
SECTION 5.01. Conditions to Obligations of Each Buyer and Seller............17
SECTION 5.02. Conditions to Obligation of Each Buyer........................18
SECTION 5.03. Conditions to Obligation of Seller............................19
ARTICLE 6
SURVIVAL; INDEMNIFICATION
SECTION 6.01. Survival......................................................19
SECTION 6.02. Indemnification...............................................20
SECTION 6.03. Exclusivity...................................................20
ARTICLE 7
MISCELLANEOUS
SECTION 7.01. Notices.......................................................21
SECTION 7.02. Amendments and Waivers........................................22
SECTION 7.03. Expenses......................................................22
SECTION 7.04. Successors and Assigns........................................22
SECTION 7.05. Governing Law.................................................22
SECTION 7.06. Jurisdiction..................................................22
SECTION 7.07. Waiver of Jury Trial..........................................23
SECTION 7.08. Counterparts; Third Party Beneficiaries.......................23
SECTION 7.09. Entire Agreement..............................................23
SECTION 7.10. Captions......................................................23
SECTION 7.11. Severability..................................................23
SECTION 7.12. Interpretation................................................24
SECTION 7.13. Remedies Cumulative...........................................24
SECTION 7.14. Subrogation...................................................24
ii
<PAGE>
Schedule A Schedule of Investors
Schedule B Seller's Account Information
Schedule C NWIP FCC Licenses
Schedule D Exceptions to Section 4.11
Exhibit I List of Transaction Documents and Collateral Agreements
iii
<PAGE>
SUBSCRIPTION AND CONTRIBUTION AGREEMENT
AGREEMENT dated as of January 29, 1999 between Nextel Partners, Inc., a
Delaware corporation ( the "COMPANY" or "SELLER"), and the Persons named on
Schedule A hereto (each a "BUYER" and collectively, the "BUYERS").
W I T N E S S E T H :
WHEREAS, to finance, in part, the building and operation of an 800 MHZ
digital wireless communications network, the Company intends to issue shares of
Series A Convertible Preferred Stock, par value $0.001 per share (the "SERIES A
PREFERRED"), Series B Preferred Stock, par value $0.001 per share (the "SERIES B
PREFERRED"), Series C Convertible Preferred Stock, par value $0.001 per share
(the "SERIES C PREFERRED"), and Series D Convertible Preferred Stock, par value
$0.001 per share (the "SERIES D PREFERRED" and, together with the Series A
Preferred, the Series B Preferred and, the Series C Preferred, the "PREFERRED
STOCK"), warrants to purchase shares of Class A Common Stock (the "WARRANTS"),
Class A Common Stock, par value $.001 per share (the "CLASS A COMMON STOCK"),
and Class B Common Stock, par value $.001 per share (the "CLASS B COMMON STOCK"
and, together with the Class A Common Stock, the "COMMON STOCK" and, together
with the Preferred Stock and the Warrants, the "SECURITIES").
WHEREAS, certain institutional investors and other cash investors
listed on the signature pages hereto wish to invest in the Company incident to
the building and operation of said digital wireless communications network;
WHEREAS, the Company desires to issue and sell the relevant Securities
to each of the Buyers, and each of the Buyers desires to purchase the relevant
Securities from Seller, upon the terms and subject to the conditions hereinafter
set forth;
The parties hereto agree as follows:
<PAGE>
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. (a) The following terms, as used herein,
have the following meanings:
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with
such Person. For purposes of this definition, the terms "CONTROL" (including
with correlative meanings, the terms "controlling", "controlled by" and "under
common control with"), as used with respect to any Person, means the possession,
directly or indirectly, of the power to vote or direct the voting of more than
50% of the outstanding shares of voting stock (or other ownership interests) of
such Person, or to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.
"ASSET TRANSFER AGREEMENT" means the Asset Transfer and Reimbursement
Agreement, dated as of the date hereof, between Opco and NWIP.
"CASH INVESTOR" means each Buyer other than NWIP and Motorola.
"CLOSING DATE" means the date of the Closing.
"COLLATERAL AGREEMENTS" means those agreements identified as such on
Exhibit I hereto.
"DLJ ENTITIES" means DLJMB, DLJ Offshore Partners II, C.V., DLJ
Diversified Partners, L.P., DLJMB Funding II, Inc., DLJ Merchant Banking
Partners II - A, L.P., DLJ Diversified Partners - A, L.P., DLJ Millennium
Partners, L.P., DLJ Millennium Partners - A, L.P., UK Investment Plan 1997
Partners, DLJ EAB Partners, L.P., DLJ ESC II L.P., DLJ First ESC L.P., and
Madison Dearborn Capital Partners II, L.P. ("MADISON DEARBORN").
"DLJMB" means DLJ Merchant Banking Partners II, L.P., a Delaware
limited partnership.
"EMPLOYMENT AGREEMENTS" means, collectively, the employment agreements
dated as of the date hereof, between Opco and each of the Management
Stockholders.
"FCC" means the Federal Communications Commission or similar regulatory
authority established in replacement thereof.
2
<PAGE>
"FCC LAW" means the Communications Act of 1934, as amended, including
as amended by the Telecommunications Act of 1996, and the rules, regulations and
policies promulgated thereunder.
"FINANCINGS" means (i) the approximately $275 million senior secured
credit facility between Opco and a lending group led by DLJ Capital Funding
Inc., or an Affiliate thereof, (ii) the issuance and sale of $400 million in
aggregate principal amount of unsecured Senior Notes of Seller to be purchased
or privately placed by an underwriting group led by Donaldson, Lufkin & Jenrette
Securities Corporation and (iii) the issuance and sale of the Preferred Stock
and Warrants to Buyers.
"JOINT VENTURE AGREEMENT" means that certain Joint Venture Agreement,
dated as of the date hereof, by and among NWIP, the Company and Opco, as such
may be amended from time to time.
"LICENSE CO." means, Nextel WIP License Co., a Delaware corporation and
wholly-owned subsidiary of Nextel.
"LICENSE TRANSFER" means the transfer of the capital stock of License
Co. to the Company or a Subsidiary thereof.
"LIEN" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest or encumbrance in respect of such
property or asset, or any right of others therein.
"MANAGEMENT AGREEMENT" means that certain interim Management Agreement,
dated as of the date hereof, by and between Opco and NWIP as such may be amended
from time to time.
"MANAGEMENT STOCKHOLDERS" means John Chapple, John Thompson, David
Thaler, David Aas, Perry Satterlee, and Mark Fanning.
"MOTOROLA" means Motorola, Inc.
"MOTOROLA AGREEMENTS" means, collectively, (i) the Infrastructure
Equipment Purchase Agreement, dated as of the date hereof, by and between Opco
and Motorola and (ii) the Subscriber Equipment Purchase and Distribution
Agreement, dated as of the date hereof, by and between Opco and Motorola.
"MOTOROLA CONTRIBUTION" means the execution and delivery by Motorola of
the Motorola Agreements.
3
<PAGE>
"NEXTEL" means Nextel Communications, Inc.
"NEXTEL AGREEMENT" means the Agreement Specifying Obligations of, and
Limiting Liability and Recourse to, Nextel, dated as of the date hereof, by and
among Nextel, Opco and the Company.
"NEXTEL CONTROLLED GROUP" means Nextel and its controlled Affiliates,
whether now existing or hereafter created or acquired.
"1999 STOCK OPTION PLAN" shall have the meaning set forth in the
Shareholders' Agreement.
"NWIP" means Nextel WIP Corp., a Delaware corporation.
"NWIP FCC LICENSES" means those FCC licenses set forth on Schedule C.
"1934 ACT" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"1933 ACT" means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
"OPCO" means Nextel Partners Operating Corp., a Delaware corporation
and a wholly-owned subsidiary of the Company.
"PERSON" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof.
"SHAREHOLDERS' AGREEMENTS" means that certain Shareholders' Agreement,
dated as of the date hereof, by and among the Company, NWIP, DLJMB, Eagle River
Investments, LLC ("EAGLE RIVER"), Motorola and certain other investors listed on
the signature pages thereof.
"TRANSACTION DOCUMENTS" means those documents listed on Exhibit I.
(b) Each of the following terms is defined in the Section set forth
opposite such term:
TERM SECTION
Accredited Investor 4.06(h)
4
<PAGE>
TERM SECTION
Buyers Recitals
Buyer Indemnified Party 6.02(a)
Class A Common Recitals
Class B Common Recitals
Closing 2.02
Common Stock Recitals
Company Recitals
Damages 6.02(a)
DLJ 4.09
DLJMB II, Inc. 4.09
Initial Cash Contribution 2.02(b)
Licenses 3.01
NWIP Contribution 2.02(b)
Pre-Closing Expenditures 5.01(g)
Preferred Stock Recitals
Purchase Price 2.01
Restated Certificate 3.05(a)
Securities Recitals
Seller Recitals
Seller Indemnified Party 6.02(b)
Series A Preferred Recitals
Series B Preferred Recitals
Series C Preferred Recitals
Series D Preferred Recitals
Subsequent Cash Contribution 2.03(a)
Subsequent Payment Date 2.03(a)
Warrants Recitals
ARTICLE 2
PURCHASE AND SALE
SECTION 2.01. Purchase and Sale. Upon the terms and subject to the
conditions of this Agreement, Seller agrees to issue and sell to each Buyer and
each Buyer irrevocably agrees in its own name severally and not jointly, to
purchase from Seller the Securities set forth opposite such Buyer's name on
Schedule A hereto at the Closing. In the event that any DLJ Entity fails to
purchase from Seller the Securities set forth opposite such DLJ Entity's name on
Schedule A hereto at the Closing, DLJMB agrees to purchase such Securities at
the Closing. The aggregate purchase price for the Securities (the "PURCHASE
5
<PAGE>
PRICE") is the amount in cash or in assets specified on Schedule A hereto. The
Purchase Price shall be paid as provided in Section 2.02.
SECTION 2.02. Closing. The closing (the "CLOSING") of the purchase and
sale of the Securities hereunder shall take place at the offices of Mayer, Brown
& Platt, 1675 Broadway, New York, NY 10019, as soon as possible, but in no event
later than five business days, after satisfaction of the conditions set forth in
Article 5, or at such other time or place as Buyers and Seller may agree. At the
Closing:
(a) Each Cash Investor shall deliver to Seller, in immediately
available funds, one-third (1/3) of the Purchase Price (the "INITIAL CASH
CONTRIBUTION") set forth opposite such Buyer's name on Schedule A hereto, by
wire transfer (or other means acceptable to Seller) to the account of Seller
described on Schedule B.
(b) NWIP will (i) execute and deliver to the Custodian one or more
stock certificates, together with stock powers duly executed in blank,
representing all the outstanding stock of License Co., together with irrevocable
instructions to release the stock of License Co. to Seller upon receipt of a
written notice from Seller and NWIP that FCC approval of the License Transfer
has been received, (ii) execute and deliver the Collateral Agreements, and (iii)
agree to use its reasonable best efforts to permit Seller to use the relevant
frequencies that are subject to the Frequency Sharing Agreement between Nextel
Communications, Inc. and Clearnet, Inc. dated January 31, 1995, as amended
(collectively the "NWIP CONTRIBUTION"). The transfer of the stock of License Co.
to Seller will occur immediately upon receipt by the Custodian of the notice
referred to above.
(c) Motorola will make the Motorola Contribution.
(d) Seller shall deliver to each Buyer certificates, or other
appropriate documentation, for the relevant Securities duly registered in the
name of such Buyer.
SECTION 2.03. Subsequent Payments. (a) Each Cash Investor shall deliver
additional payments of one-third (1/3) of such Cash Investor's Purchase Price
(each, a "SUBSEQUENT CASH CONTRIBUTION") to Seller in immediately available
funds, by wire transfer (or other means acceptable to Seller) to the account
described on Schedule B (or such other account as the Seller may from time to
time designate) on each of December 31, 1999 and December 31, 2000 (each, a
"SUBSEQUENT PAYMENT DATE").
(b) Seller has the right to (i) accelerate payment of each of the
Subsequent Cash Contributions by up to 90 days prior to the relevant Subsequent
Payment Date by providing the relevant Buyers with notice at least 30 days
before
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the proposed payment date and (ii) assign the right to receive any unpaid
Subsequent Cash Contribution to a lender as security for an interim advance to
the Company by such lender.
(c) Each Cash Investor acknowledges and agrees that, if the Closing
occurs, its obligation to make payments to Seller of the relevant Subsequent
Cash Contributions constitutes an absolute, irrevocable and unconditional
obligation, and shall not be subject to claim, set-off, or other rights which
such Buyer may have at any time against the Seller. If a Buyer fails to pay a
Subsequent Cash Contribution to the Seller more than two business days after the
Subsequent Payment Date: (i) such defaulting party will be subject to liquidated
damages in the amount of 25% of its Securities (which liquidated damages, in the
case of the DLJ Entities, shall be paid to DLJMB (in lieu of the Company), if
DLJMB timely paid (or caused to be paid timely) the Subsequent Cash
Contribution), (ii) all remaining Subsequent Cash Contributions of such
defaulting party shall become immediately due and payable in full, (iii) the
outstanding amount shall accrue interest at a rate per annum equal to 200 basis
points over the highest rate of interest charged from time to time by the
Seller's senior lenders, (iv) the rights of such defaulting party under the
Shareholders' Agreement but none of its obligations will terminate and (v) the
Series A Preferred Stock of such defaulting party will convert to Class A Common
Stock in accordance with the Restated Certificate.
(d) Without limiting Section 2.03(c), in the event that any DLJ Entity
fails to make any Subsequent Cash Contribution on the applicable Subsequent
Payment Date, DLJMB shall make (or shall cause to be made) such Subsequent Cash
Contribution within two business days of such Subsequent Payment Date. DLJMB
acknowledges and agrees that, if the Closing occurs, its obligation to make
payments to Seller of Subsequent Cash Contributions of other DLJ Entities
pursuant to the preceding sentence constitutes an absolute, irrevocable and
unconditional obligation, and shall not be subject to claim, set-off, or other
rights which DLJMB may have at any time against the Seller nor shall the Seller
be required to exhaust any remedies against the defaulting party before
proceeding against DLJMB to enforce this Section 2.03(d) against DLJMB. In the
event of a payment default by DLJMB under this paragraph (d), (i) all remaining
Subsequent Cash Contributions of DLJMB shall become immediately due and payable
in full, (ii) the outstanding amount shall accrue interest at a rate per annum
equal to 200 basis points over the highest rate of interest charged from time to
time by the Seller's senior lenders, (iii) the Series A Preferred of DLJMB will
convert to Class A Common Stock in accordance with the Restated Certificate and
(iv) the rights of DLJMB but none of its obligations under the Shareholders'
Agreement will terminate.
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(e) In the event that a Cash Investor transfers all or part of its
Securities in advance of completing its payment obligations under Article 2,
such Cash Investor shall remain primarily liable for the transferee's remaining
Subsequent Cash Payments.
(f) NWIP covenants and agrees that it will cause the representations
and warranties in Section 4.12 to remain true and correct at all times from the
date hereof until the License Transfer has been consummated and shall also use
its commercially reasonable best efforts to cause the representations and
warranties set forth in Section 4.11 to remain true and correct at all times
from the date hereof until the License Transfer has been consummated. NWIP
agrees that, upon such approval of the FCC as will permit the License Transfer
to be lawfully consummated, such transfer will thereupon be deemed to be
accomplished without any further action on the part of NWIP, and the Company and
the Custodian are hereby irrevocably authorized at such time to deliver the
stock certificates and completed stock power in such manner as necessary and
appropriate to consummate (i) the License Transfer and (ii) the pledge of the
stock of License Co. to Opco's senior lenders as contemplated by the terms of
Opco's senior secured credit facility.
SECTION 2.04. Remedies. Each Buyer acknowledges that the Seller is a
start-up company and agrees that as such the Seller would suffer irreparable
harm, including the great harm to its ability to operate in accordance with its
business plan during its critical start-up phase, in the event that such Buyer
failed to pay in full, as and when due, its portion of the Purchase Price. The
parties agree that if any provision of this Article 2 is not performed by a
Buyer in accordance with its specific terms or is otherwise breached,
irreparable damage to the Seller would occur, no adequate remedy at law would
exist and damages would be difficult to determine, and that the Seller will
therefore be entitled to (i) specific performance of the terms of this Article
2, (ii) the remedies set forth in Sections 2.03(c) and 2.03(d), including,
liquidated damages in the amount of 25% of such Buyer's Securities (which
damages are intended by the parties to compensate the Seller for the harm
suffered by reason of such Buyer's failure to pay when due its portion of the
Purchase Price, it being understood and agreed that recovery of damages in an
amount equal to such portion of the Purchase Price plus accrued interest thereon
shall not be sufficient to adequately compensate the Seller for such harm) and
(iii) any other remedy available under this Agreement or otherwise at law or in
equity.
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to each Buyer as of the date hereof
that:
SECTION 3.01. Corporate Existence and Power. Each of Seller and Opco is
a corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and has all corporate powers and all governmental
licenses, authorizations, permits, consents and approvals ("LICENSES"), required
to carry on its business as now conducted.
SECTION 3.02. Corporate Authorization. The execution, delivery and
performance by each of Seller and Opco of each of the Transaction Documents to
which it is a party and the consummation of the transactions contemplated hereby
and thereby (including the issuance and sale of the Securities) are within
Seller's or Opco's (as applicable) corporate powers and have been duly
authorized by all necessary corporate action on the part of such corporation.
Each of the Transaction Documents to which it is a party constitutes or, when
executed, will constitute a valid and binding agreement of each of Seller and
Opco, enforceable against Seller and Opco in accordance with its respective
terms, except (i) as limited by the applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement of creditors' rights generally, or (ii) as limited by laws relating
to the availability of specific performance, injunctive relief, or other
equitable remedies.
SECTION 3.03. Governmental Authorization. The execution, delivery and
performance by Seller and Opco of each of the Transaction Documents to which it
is a party and the consummation of the transactions contemplated hereby and
thereby require no order, license, consent, authorization or approval of, or
exemption by, or action by or in respect of, or notice to, or filing or
registration with, any governmental body, agency or official except such as have
been made or obtained and, with respect to its conduct of business after the
Closing as contemplated by the Joint Venture Agreement, such of the foregoing as
Seller reasonably expects to obtain in the ordinary course of business.
SECTION 3.04. Noncontravention. The execution, delivery and performance
by Seller and Opco of each of the Transaction Documents to which it is a party
and the consummation of the transactions contemplated hereby and thereby do not
and will not (i) violate the Restated Certificate or the by-laws of the Seller
or the Certificate of Incorporation or by-laws of Opco, (ii) violate any
applicable law, rule, regulation, judgment, injunction, order or decree, (iii)
require any consent or other action by any Person under, constitute a default
under (with due notice or lapse of time or both), or give rise to any right of
termination,
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cancellation or acceleration of any right or obligation of Seller or Opco or to
a loss of any material benefit to which Seller or Opco is entitled under any
provision of any agreement or other instrument binding upon Seller or Opco or
any of Seller's or Opco's assets or properties or (iv) result in the creation or
imposition of any material Lien on any property or asset of Seller or Opco.
SECTION 3.05. Capitalization and Voting Rights. (a) The authorized
capital stock of Seller consists of 75,000,000 shares of Class A Common Stock,
25,000,000 shares of Class B Common Stock and 70,000,000 shares of preferred
stock, and the outstanding capital stock of Seller immediately prior to the
Closing is 1,588,888 shares of Class A Common Stock, no shares of Class B Common
Stock and no shares of preferred stock. The rights, privileges and preferences
of the Class A and Class B Common Stock and the Series A, Series B, Series C and
Series D Preferred Stock are set forth in the Restated Certificate of
Incorporation (the "RESTATED CERTIFICATE").
(b) Immediately following the Closing the outstanding securities of
Seller will be 1,588,888 shares of Class A Common Stock, no shares of Class B
Common Stock, 17,479,999 shares of Series A Preferred, 2,185,000 shares of
Series B Preferred, 8,740,000 shares of Series C Preferred, 2,185,000 shares of
Series D Preferred, the Warrants, options issued or issuable under the 1999
Stock Option Plan, and options to purchase 35,000 shares of Class A Common Stock
issued to John Thompson.
(c) The authorized capital stock of Opco consists of 200 shares of
common stock. Immediately following the Closing the outstanding capital stock of
Opco will be 100 shares of common stock. The Seller owns all the outstanding
capital stock of Opco.
(d) Except as set forth in this Section 3.05 there are, and immediately
after the Closing there will be, no outstanding (i) shares of capital stock or
voting securities of the Seller or Opco, (ii) securities of the Seller or Opco
convertible into or exchangeable for shares of capital stock or voting
securities of the Seller or Opco, as the case may be, (iii) options or other
rights to acquire from the Seller or Opco, or other obligation of the Seller or
Opco to issue, any capital stock, voting securities or securities convertible
into or exchangeable for capital stock or voting securities of the Seller or
Opco, or (iv) other than as expressly permitted in the Transaction Documents, no
obligation of the Seller or Opco to repurchase or otherwise acquire or retire
any shares of capital stock or any convertible securities, rights or options of
the type described in (i), (ii), or (iii).
SECTION 3.06. Valid Issuance of Securities. Each of the Securities
which are being issued to the Buyers hereunder have been duly and validly
authorized
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and when issued, sold and delivered in accordance with the terms hereof for the
consideration expressed herein, will be fully paid and nonassessable.
SECTION 3.07. Litigation. (a) There is no action, suit, investigation
or proceeding pending against, or to the knowledge of Seller, threatened against
or affecting Seller or any of its properties before any court or arbitrator or
any governmental body, agency or official which in any manner challenges or
seeks to prevent, enjoin, alter or materially delay the transactions
contemplated by this Agreement or which could reasonably be expected to have a
material adverse effect on the business, financial condition, properties or
operations of Seller, nor is Seller aware that there is any basis for the
foregoing.
(b) There is no action, suit, investigation or proceeding pending
against, or to the knowledge of Opco, threatened against or affecting Opco or
any of its properties before any court or arbitrator or any governmental body,
agency or official which in any manner challenges or seeks to prevent, enjoin,
alter or materially delay the transactions contemplated by this Agreement or
which could reasonably be expected to have a material adverse effect on the
business, financial condition, properties or operations of Opco, nor is Opco
aware that there is any basis for the foregoing.
SECTION 3.08. Newly Formed Corporation. Seller was incorporated on July
8, 1998 in the State of Delaware solely for the purpose of effectuating the
transactions contemplated in this Agreement and the other Transaction Documents
and has not conducted any business or entered into any agreements or commitments
except with respect to the foregoing and, as of the date hereof, has no
obligations or liabilities other than (i) those arising under, or contemplated
by, the Transaction Documents or the Financings, (ii) those representing amounts
due to its outside professional advisors in connection with services rendered by
them to the Company and/or Opco to prepare for or facilitate consummation of the
transactions contemplated to occur at the Closing and (iii) other miscellaneous
immaterial obligations and liabilities that in the aggregate collectively amount
to less than $10,000.
SECTION 3.09. Representations of Buyers. Seller has not relied on any
representations or warranties of Buyers or any Affiliate of Buyers not made in
this Agreement or any of the other Transaction Documents. Seller has not relied
on and acknowledges that no representations have been made by any Buyers or any
officers, employees, Affiliates, agents or representatives of Buyers, or any
Management Stockholder, except for representations and warranties expressly set
forth in this Agreement and the other Transaction Documents. Seller has not
relied on and acknowledges that no representations or warranties have been made
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by NWIP with respect to FCC matters and FCC Law except for representations and
warranties expressly set forth in Section 4.11.
SECTION 3.10. Use of Proceeds. The proceeds from the Financings will be
used to fund the build out of, and operating and transaction expenses relating
to, the Seller's wireless communications network (including reimbursement of
certain capital expenditures and operating expenses incurred by Nextel (and/or
its subsidiaries) and Eagle River) in accordance with the Company's business
plan.
SECTION 3.11. Corporate Documents. All requisite action has been taken
(including all action required under the applicable laws of the State of
Delaware) to cause the Restated Certificate and the by-laws of the Company and
the Certificate of Incorporation and the by-laws of Opco to be duly and validly
adopted, properly filed and in full force and effect.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYERS
Each Buyer (or in the case of Section 4.09, DLJMB only, and Sections
4.11 and 4.12, NWIP only) represents and warrants to Seller (or in the case of
Section 4.06, to Seller, NWIP and Nextel), severally as to itself only and not
jointly or as to any other Buyer that as of the date hereof (and in the case of
Sections 4.11 and 4.12, as of the date of the completion of the License
Transfer):
SECTION 4.01. Existence and Power. Such Buyer, if not an individual, is
duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization and has all powers (corporate, partnership or
otherwise) and all Licenses required to carry on its business as now conducted.
Such Buyer, if an individual, has the legal capacity to enter into this
Agreement and the Shareholders' Agreement.
SECTION 4.02. Authorization. The execution, delivery and performance by
such Buyer of each of this Agreement, and when executed, the Shareholders'
Agreement (and, in the case of each of NWIP and Motorola, each of the other
Transaction Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby are or, when executed, will be
within the powers (corporate, partnership or otherwise) of such Buyer and have
been or will have been duly authorized by all necessary action on the part of
such Buyer. This Agreement constitutes and the Shareholders' Agreement (and, in
the case of each of NWIP and Motorola, each of the other Transaction Documents
to which it is a party), when executed, will constitute a valid and binding
agreement of such Buyer, each enforceable in accordance with their respective
terms, except (i) as limited by the applicable bankruptcy, insolvency,
reorganization,
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moratorium, and other laws of general application affecting enforcement or
creditors' rights generally, or (ii) as limited by laws relating to the
availability of specific performance, injunctive relief, or other equitable
remedies.
SECTION 4.03. Governmental Authorization. The execution, delivery and
performance by such Buyer of this Agreement and the Shareholders' Agreement
(and, in the case of each of NWIP and Motorola, each of the other Transaction
Documents to which it is a party) and the consummation of the transactions
contemplated hereby and thereby require no order, license, consent,
authorization or approval of, or exemption by, or action by or in respect of, or
notice to, or filing or registration with, any governmental body, agency or
official except as contemplated by Section 2.02(b)(i) and as set forth in
Article 5.
SECTION 4.04. Noncontravention. The execution, delivery and performance
by such Buyer of each of the relevant Transaction Documents and the consummation
of the transactions contemplated hereby and thereby do not and will not (i)
violate the organizational documents of such Buyer, (ii) violate any applicable
law, rule, regulation, judgment, injunction, order or decree, (iii) require any
consent or other action by any Person under, constitute a default under (with
due notice or lapse of time or both), or give rise to any right of termination,
cancellation or acceleration of any right or obligation of such Buyer (or, in
the case of NWIP, NWIP or License Co.) or to a loss of any material benefit to
which such Buyer (or, in the case of NWIP, NWIP or License Co.) is entitled
under any provision of any agreement or other instrument binding upon such Buyer
(or, in the case of NWIP, NWIP or License Co.) or any of its assets or
properties, to the extent that any of the foregoing would have a material
adverse effect on such Buyer or would prevent or otherwise render such Buyer
unable to perform its obligations under any Transaction Document to which it is
a party or (iv) result in the creation or imposition of any material Lien on any
property or asset of such Buyer (or, in the case of NWIP, NWIP or License Co.),
to the extent that any of the foregoing would have a material adverse effect on
such Buyer or would prevent or otherwise render such Buyer unable to perform its
obligations under any Transaction Document to which it is a party.
SECTION 4.05. Purchase for Investment. Such Buyer is purchasing the
relevant Securities for investment for its own account and not with a view to,
or for sale in connection with, any distribution thereof.
SECTION 4.06. Private Placement. (a) Such Buyer understands that (i)
the offering and sale of the Securities hereby is intended to be exempt from
registration under the 1933 Act and (ii) there is only a limited market for the
Securities, and there can be no assurance that any Buyer will be able to sell or
dispose of the Securities to be purchased by such Buyer.
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(b) Such Buyer's financial situation is such that such Buyer can afford
to bear the economic risk of holding the relevant Securities acquired hereunder
for an indefinite period of time, and such Buyer can afford to suffer the
complete loss of the investment in such Securities.
(c) Such Buyer's knowledge and experience in financial and business
matters are such that it is capable of evaluating the merits and risks of the
investment in the relevant Securities, or such Buyer has been advised by a
representative possessing such knowledge and experience.
(d) Such Buyer understands that the Securities acquired hereunder are a
speculative investment which involves a high degree of risk of loss of the
entire investment therein, that there are substantial restrictions on the
transferability of the Securities as set forth in the Shareholders' Agreement,
and that for an indefinite period following the date hereof there will be no (or
only a limited) public market for the Securities and that, accordingly, it may
not be possible for such Buyer to sell the Securities in case of emergency or
otherwise.
(e) Such Buyer and its representatives, including, to the extent it
deems appropriate, its professional, financial, tax and other advisors, have
reviewed all documents provided to them in connection with the investment in the
Securities, and such Buyer understands and is aware of the risks related to such
investment.
(f) Such Buyer and its representatives have been given the opportunity
to examine all documents and to ask questions of, and to receive answers from,
Seller and its representatives and Nextel and its representatives concerning the
terms and conditions of the acquisition of the Securities and related matters
and to obtain all additional information which such Buyer or its representatives
deem necessary.
(g) All written information which such Buyer has provided to Seller and
its representatives and Nextel and its representatives concerning such Buyer and
such Buyer's financial position was true, complete and correct at the time it
was provided.
(h) Such Buyer is an "ACCREDITED INVESTOR" as such term is defined in
Regulation D under the 1933 Act.
(i) Such Buyer is not relying on and acknowledges that no
representation is being made by any other Buyer, or any of its officers,
employees, Affiliates, agents or representatives, the Seller or any of its
officers, employees, Affiliates, agents or representatives, Nextel or any of its
officers, employees, Affiliates, agents or representatives, or any Management
Stockholder, except for
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representations and warranties expressly set forth in this Agreement and the
other Transaction Documents.
SECTION 4.07. Litigation. There is no action, suit, investigation or
proceeding pending against, or to the knowledge of such Buyer threatened against
or affecting, such Buyer before any court or arbitrator or any governmental
body, agency or official which could be reasonably expected to have a material
adverse effect on its ability to consummate the transactions contemplated by
this Agreement or the Shareholders' Agreement.
SECTION 4.08. Brokers or Finders' Fees. There is no investment banker,
broker, finder or other intermediary which has been retained by, will be
retained by or is authorized to act on behalf of such Buyer who might be
entitled to any fee or commission from the Seller upon consummation of the
transactions contemplated by this Agreement.
SECTION 4.09. Capital of DLJMB. DLJ Merchant Banking II, Inc. ("DLJMB
II, INC.") is an indirect wholly-owned subsidiary of Donaldson Lufkin &
Jenrette, Inc. ("DLJ") and is the managing general partner of DLJMB and certain
affiliated investment vehicles that coinvest with DLJMB. DLJMB and the other DLJ
Entities have committed capital of $3 billion, of which approximately 60%
remains available for investment. The scheduled term of DLJMB extends through
2005 and no event or circumstance has occurred that would reasonably be expected
to cause the term of DLJMB to expire or be subject to termination prior to the
last Subsequent Payment Date. Through DLJMB and the other DLJ Entities, DLJMB
II, Inc. has access to freely available cash in an amount sufficient to make in
full and in a timely manner all committed investments contemplated to be made by
it (including its transferees, if any) hereunder, including the Subsequent Cash
Contributions, in the aggregate amount of $74,249,720. As of the date hereof,
each of the DLJ Entities is an Affiliate of DLJ.
SECTION 4.10. Capital Commitment. Each Cash Investor has, and will have
on the Closing Date and on any Subsequent Payment Date, cash available to it in
an amount sufficient to make its Initial Cash Contribution or Subsequent Cash
Contribution, as the case may be, in accordance with the terms of Article 2.
SECTION 4.11. FCC Compliance; NWIP FCC Licenses. (a) License Co. is the
holder of the NWIP FCC Licenses. Except as disclosed in Schedule D, each of the
NWIP FCC Licenses is valid and in full force and effect. Except as disclosed
in Schedule D, there are no conditions on the NWIP FCC Licenses that would
likely have a material adverse effect on such licenses or their use in an ESMR
network in the Territories as contemplated by the Joint Venture Agreement other
than those as set forth on the face of the NWIP FCC Licenses or in statutes and
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FCC rules and policies of general applicability to the commercial mobile radio
industry. Except as disclosed in Schedule D, there is no complaint,
investigation, notice of violation, or other proceeding against, or otherwise
relating to, the NWIP FCC Licenses, License Co. or any member of the Nextel
Controlled Group pending or, to the knowledge of License Co. or any member of
the Nextel Controlled Group, threatened by or before the FCC (i) that would
likely have a material adverse effect on the NWIP FCC Licenses or their use in
an ESMR network in the Territories as contemplated by the Joint Venture
Agreement, (ii) which questions or contests the validity of, or assignment to
the Company or any member of the Nextel Controlled Group, or seeks the
revocation, nonrenewal or suspension of, any of the NWIP FCC Licenses, (iii)
which seeks the imposition of any modification or amendment with respect to any
of the NWIP FCC Licenses, or (iv) which could reasonably be expected to
adversely affect the ability of Seller to build and operate an iDEN system after
the Closing Date substantially as contemplated by the relevant Transaction
Documents other than proceedings which generally affect the commercial mobile
radio industry. Except as disclosed in Schedule D, License Co. and the Nextel
Controlled Group are in compliance in all material respects with the FCC Law,
and the rules and regulations of the FCC, including without limitation all
applicable eligibility criteria for holding the NWIP FCC Licenses, except to the
extent that noncompliance would not likely have a material adverse effect on the
NWIP FCC Licenses or their use in an ESMR Network in the Territories as
contemplated by the Joint Venture Agreement.
(b) NWIP reaffirms the representations and warranties set forth in
Section 4.11(a) as of the date of the License Transfer, provided, that the
Seller acknowledges that NWIP is not responsible for a breach of such
representations and warranties under Section 4.11(a) resulting from any action
or inaction by the Seller or any of its subsidiaries with respect to such NWIP
FCC Licenses.
SECTION 4.12. Newly Formed Corporation. License Co. was incorporated on
November 4, 1998 in the State of Delaware solely for the purpose of effectuating
the transactions contemplated in this Agreement and the other Transaction
Documents and has not conducted any business or entered into any agreements or
commitments except with respect to the foregoing and has no obligations or
liabilities other than (i) those arising under, or contemplated by, the
Transaction Documents or the Financings and (ii) other miscellaneous immaterial
obligations and liabilities that in the aggregate collectively amount to less
than $10,000. License Co. has furnished to the Company a true and correct copy
of its Certificate of Incorporation and by-laws as in effect on the Closing
Date. The authorized capital stock of License Co. consists of 100 shares of
common stock, no par value. The outstanding capital stock of License Co. is 100
shares of common stock, all of which shares have been duly and validly
authorized, and are fully paid and nonassessable. NWIP owns all the outstanding
capital stock of
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License Co. free and clear of any liens, and License Co. has no subsidiaries.
Except as set forth in this Section 4.12, there are no outstanding (i) shares of
capital stock or voting securities of License Co., (ii) securities of License
Co. convertible into or exchangeable for shares of capital stock or voting
securities of License Co., (iii) options or other rights to acquire from License
Co., or other obligation of License Co. to issue, any capital stock, voting
securities or securities convertible into or exchangeable for capital stock or
voting securities of License Co., or (iv) obligation of License Co. to
repurchase or otherwise acquire or retire any shares of capital stock or any
convertible securities, rights or options of the type described in (i), (ii), or
(iii). License Co. (x) has obtained such proper authorization as may be required
from its Board of Directors and its shareholders of all corporate action taken
by License Co., (y) keeps its assets and liabilities separate from those of
other entities (including Nextel and the Affiliates thereof) and (z) does not
hold itself out as being liable for the debts of Nextel or any Affiliate
thereof.
ARTICLE 5
CONDITIONS TO CLOSING
SECTION 5.01. Conditions to Obligations of Each Buyer and Seller. The
obligations of each Buyer and Seller to consummate the Closing are subject to
the satisfaction of the following conditions:
(a) No provision of any applicable law, rule or regulation and no
effective or pending judgment, injunction, order or decree by any governmental
entity of competent jurisdiction shall prohibit the consummation of the Closing.
(b) All material actions by or in respect of, or filings with, any
governmental body, agency, official or authority required to permit the
consummation of the Closing shall have been taken, made or obtained.
(c) The conditions to the execution and delivery of the other
Transaction Documents shall have been satisfied or waived and each of the other
Transaction Documents shall have been executed and delivered with any waiver of
conditions and any other changes having been consented to by each of NWIP,
DLJMB, Eagle River, and Motorola.
(d) The Restated Certificate shall have been duly filed at the office
of the Secretary of State of the State of Delaware.
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(e) Subject to Section 2.01, each other Buyer shall have purchased the
Securities to be purchased by it hereunder by paying the Purchase Price
applicable thereto in accordance with Section 2.02.
(f) Seller shall have received cash proceeds of at least $575 million
from debt financing on terms and conditions acceptable to each of DLJMB, Eagle
River, Motorola and NWIP.
(g) The Company shall reimburse NWIP and Eagle River for Pre- Closing
Expenditures set forth in a detailed written estimate provided to the Company,
DLJMB and each other Shareholder at least ten days prior to Closing. Within 60
days after the date hereof, representatives of the Company shall meet with
representatives of NWIP and Eagle River to adjust such estimates and to agree on
the amount of any additional reimbursement by (or refund to) the Company. Any
dispute that arises as a result of such discussions shall be submitted to
arbitration pursuant to Section 12.7 of the Joint Venture Agreement.
"PRE-CLOSING EXPENDITUREs" means capital expenditures and operating expenses
made and incurred by Nextel (and its Affiliates) and Eagle River prior to the
date hereof for assets, properties, rights or services (other than the capital
expenditures and operating expenses paid for or reimbursed pursuant to the Asset
Transfer Agreement)) in order to facilitate the construction of the Company's
ESMR Network in the Territory (as such terms are defined in the Joint Venture
Agreement).
(h) Each of the Management Stockholders shall have executed and
delivered to Seller an Employment Agreement.
(i) Any applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended shall have expired or been terminated.
SECTION 5.02. Conditions to Obligation of Each Buyer. The obligation of
each Buyer to consummate the Closing is subject to the satisfaction of the
following further conditions:
(a) (i) Seller shall have performed in all material respects all of its
obligations hereunder required to be performed by it on or prior to the Closing
Date and (ii) the representations and warranties of Seller contained in this
Agreement and in any certificate or other writing delivered by Seller pursuant
hereto shall be true in all material respects when made and at and as of the
Closing Date, as if made at and as of such date.
(b) Each Buyer shall have received all documents and evidence it may
reasonably request relating to the existence of Seller and the authority of
Seller to
18
<PAGE>
execute, deliver and perform this Agreement, all in form and substance
reasonably satisfactory to such Buyer.
SECTION 5.03. Conditions to Obligation of Seller. The obligation of
Seller to consummate the Closing with respect to any Buyer is subject to the
satisfaction of the following further conditions:
(a) (i) Each Buyer shall have performed in all material respects all of
its obligations hereunder required to be performed by it at or prior to the
Closing Date and (ii) the representations and warranties of such Buyer contained
in this Agreement and in any certificate or other writing delivered by such
Buyer pursuant hereto shall be true in all material respects when made and at
and as of the Closing Date, as if made at and as of such date.
(b) Seller shall have received all documents it may reasonably request
relating to the existence of such Buyer and the authority of such Buyer to
execute, deliver and perform this Agreement, all in form and substance
reasonably satisfactory to Seller. Seller shall have received from NWIP true and
correct copies of all the documentation relating to (i) the transfer of assets
contemplated by the Asset Transfer Agreement and (ii) the provision by Nextel
and/or its subsidiaries to NWIP of the rights necessary to perform its
obligations under the Collateral Agreements.
ARTICLE 6
SURVIVAL; INDEMNIFICATION
SECTION 6.01. Survival. The representations and warranties of the
parties hereto contained in this Agreement or in any certificate delivered
pursuant hereto or in connection herewith shall survive the Closing until three
years after the Closing Date, provided that any party's representations and
warranties herein relating to payment in full of the Purchase Price or issuance
or delivery of Securities upon payment therefore, shall survive until such
payments, issuances and deliveries have been made or performed in full.
Notwithstanding the preceding sentence, any representation or warranty in
respect of which indemnity may be sought under this Agreement shall survive the
time at which it would otherwise terminate pursuant to the preceding sentence,
if written notice of the inaccuracy or breach thereof giving rise to such right
of indemnity shall have been given to the party against whom such indemnity may
be sought prior to such time, but only as to such inaccuracy or breach. Any
actual or alleged breach of any representation or warranty made in this
Agreement shall not affect in any manner
19
<PAGE>
whatsoever the relative rights and obligations of the parties to and under the
Shareholders' Agreement.
SECTION 6.02. Indemnification. (a) Seller hereby indemnifies, severally
and not jointly, each Buyer and its Affiliates, limited partners, general
partners, directors, officers and employees (each, a "BUYER INDEMNIFIED PARTY")
against and agrees to hold each of them harmless from any and all damage, loss,
liability and expense (including, without limitation, reasonable expenses of
investigation and reasonable attorneys' fees and expenses in connection with any
action, suit or proceeding) ("DAMAGES") incurred or suffered by any Buyer
Indemnified Party arising out of any misrepresentation or breach of warranty,
covenant or agreement made or to be performed by Seller pursuant to this
Agreement except to the extent (but only to the extent) any such Damages arise
out of or result from the gross negligence or willful misconduct of such Buyer
Indemnified Party or its Affiliates.
(b) Each Buyer hereby indemnifies, severally and not jointly, Seller
and its Affiliates, limited partners, general partners, directors, officers and
employees (each, a "SELLER INDEMNIFIED PARTY") against and agrees to hold each
of them harmless from any and all Damages incurred or suffered by any Seller
Indemnified Party arising out of any misrepresentation or breach of warranty,
covenant or agreement made or to be performed by such Buyer pursuant to this
Agreement except to the extent (but only to the extent) any such Damages arise
out of or result from the gross negligence or willful misconduct of such Seller
Indemnified Party or its Affiliates.
SECTION 6.03. Exclusivity. After the Closing, Section 6.02 will provide
the exclusive remedy for any misrepresentation, breach of warranty, covenant or
other agreement or other claim arising out of this Agreement or the transactions
contemplated hereby except that Sections 2.03 and 2.04 will also provide
remedies for any breach under Article 2 (it being understood that the remedial
provisions of the other Transaction Documents shall apply to any
misrepresentation, breach of warranty, covenant or other agreement or other
claim arising thereunder).
ARTICLE 7
MISCELLANEOUS
SECTION 7.01. Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including facsimile transmission)
and shall be given,
20
<PAGE>
if to any Buyer, to such Buyer at the address specified by such Buyer
on the signature pages of this Agreement or in a notice given by such Buyer to
Seller for such purpose, provided that in the case of Buyers that are DLJ
Entities, a copy shall be sent to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Fax: 212-450-4800
Attention: John Buttrick
if to Seller , to:
Nextel Partners, Inc.
4500 Carillon Point
Kirkland, WA 98033
Attn: General Counsel
Fax: 425-828-8098
with a copy to:
Friedman Kaplan & Seiler LLP
875 Third Avenue, 8th Floor
New York, NY 10022
Fax: 212-355-6401
Attention: Gary D. Friedman
or to such other address or telecopy number and with such other copies as such
party may hereafter specify for the purpose of notice.
All such notices, requests and other communications shall be deemed
received on the date of receipt by the recipient thereof if received prior to 5
p.m. in the place of receipt and such day is a business day in the place of
receipt. Otherwise, any such notice, request or communication shall be deemed
not to have been received until the next succeeding business day in the place of
receipt.
SECTION 7.02. Amendments and Waivers. (a) Any provision of this
Agreement may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed, in the case of an amendment, by each party to this
Agreement, or in the case of a waiver, by the party against whom the waiver is
to be effective.
21
<PAGE>
(b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 7.03. Expenses. The Company shall pay the fees and expenses set
forth in Section 8.06 of the Shareholders' Agreement. Notwithstanding the
preceding sentence, any Buyer that defaults in its payment obligations under
Article 2 shall pay on demand the Seller's costs (including reasonable
attorney's fees and expenses) of enforcement.
SECTION 7.04. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns and indemnified persons; provided
that except as provided in Section 2.03 no party may assign, delegate or
otherwise transfer any of its rights or obligations under this Agreement without
the consent of each other party hereto; provided however, that the Company may
collaterally assign its rights and interest in this Agreement to Opco's senior
lenders that have granted to members of the Nextel Group the rights described on
Exhibit 4.13 to the Joint Venture Agreement (or other rights as Nextel may
agree).
SECTION 7.05. Governing Law. This Agreement shall be governed by and
construed in accordance with the law of the State of New York.
SECTION 7.06. Jurisdiction. The parties hereto agree that any suit,
action or proceeding seeking to enforce any provision of, or based on any matter
arising out of or in connection with, this Agreement or the transactions
contemplated hereby may only be brought in the United States District Court for
the Southern District of New York or any New York State court sitting in New
York City, and each of the parties hereby consents to the jurisdiction of such
courts (and of the appropriate appellate courts therefrom) in any such suit,
action or proceeding and irrevocably waives, to the fullest extent permitted by
law, any objection which it may now or hereafter have to the laying of the venue
of any such suit, action or proceeding in any such court or that any such suit,
action or proceeding which is brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 7.01 shall be deemed
effective service of process on such party.
22
<PAGE>
SECTION 7.07. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
SECTION 7.08. Counterparts; Third Party Beneficiaries. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received a counterpart hereof signed by the other parties hereto. No
provision of this Agreement shall confer upon any Person other than the parties
hereto (and Persons entitled to indemnification under Article 6 and Nextel,
which is entitled to rely on the representations and warranties made in Section
4.06) any rights or remedies hereunder.
SECTION 7.09. Entire Agreement. This Agreement along with the
Shareholders' Agreement (including the documents, schedules and exhibits
referred to herein and therein) and the other Transaction Documents constitute
the entire agreement between the parties with respect to the subject matter of
this Agreement and supersedes all prior agreements and understandings, both oral
and written, between the parties with respect to the subject matter of this
Agreement.
SECTION 7.10. Captions. The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof.
SECTION 7.11. Severability. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforced in
accordance with its terms to the maximum extent permitted by law.
SECTION 7.12. Interpretation. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
SECTION 7.13. Remedies Cumulative. All rights, powers and remedies
provided under this Agreement or otherwise available in respect hereof at law or
in equity shall be cumulative and not alternative, and the exercise or beginning
of the exercise of any thereof by any party shall not preclude the simultaneous
or later exercise of any other such right, power or remedy by such party.
23
<PAGE>
SECTION 7.14. Subrogation. Madison Dearborn acknowledges that DLJMB is
a third party beneficiary of its obligations to make Subsequent Cash
Contributions pursuant to Section 2.03. Upon a payment to Seller by DLJMB of a
Madison Dearborn Subsequent Cash Contribution pursuant to Section 2.03(d), DLJMB
shall be subrogated to the rights of Seller against Madison Dearborn with
respect to such Subsequent Cash Contribution payment obligations.
24
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
NEXTEL PARTNERS, INC., a Delaware
corporation
By: /s/ John Chapple
--------------------------------------
Name: John Chapple
Title: President and Chief Executive
Officer
NEXTEL WIP CORP., a Delaware
corporation
By: /s/ Thomas J. Sidman
--------------------------------------
Name: Thomas J. Sidman
Title: President
Address: 1505 Farm Credit Drive
McLean, VA 22102
Attn: General Counsel
Fax: 703-394-3496
With a copy of notice to:
Jones, Day, Reavis & Pogue
North Point
901 Lakeside Avenue
Cleveland, Ohio 44114
Attn: Jeanne Rickert
Fax: 216-579-0212
<PAGE>
DLJ MERCHANT BANKING PARTNERS
II, L.P., a Delaware Limited Partnership
By: DLJ Merchant Banking II, Inc., as
managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
with a copy of notice to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
Attn: John Buttrick
Fax: 212-450-5426
DLJ MERCHANT BANKING PARTNERS
II-A, L.P., a Delaware Limited
Partnership
By: DLJ Merchant Banking II, Inc., as
managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
<PAGE>
DLJ OFFSHORE PARTNERS II, C.V., a
Netherlands Antilles Limited Partnership
By: DLJ Merchant Banking II, Inc., as
advisory general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
DLJ DIVERSIFIED PARTNERS, L.P., a
Delaware Limited Partnership
By: DLJ Diversified Partners, Inc., as
managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
DLJ DIVERSIFIED PARTNERS-A, L.P., a
Delaware Limited Partnership
By: DLJ Diversified Partners, Inc.,
as managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
<PAGE>
DLJ MILLENNIUM PARTNERS, L.P., a
Delaware Limited Partnership
By: DLJ Merchant Banking II, Inc.,
as managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
DLJ MILLENNIUM PARTNERS-A, L.P.
By: DLJ Merchant Banking II, Inc., as
managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
DLJMB FUNDING II, INC., a Delaware
corporation
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
<PAGE>
DLJ FIRST ESC, L.P.,
By: DLJ LBO Plans Management Corporation,
as manager
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
DLJ EAB PARTNERS, L.P.
By: DLJ LBO Plans Management Corporation,
as managing general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
DLJ ESC II, L.P.
By: DLJ LBO Plans Management Corporation,
as manager
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
<PAGE>
UK INVESTMENT PLAN 1997 PARTNERS,
a Delaware Limited Partnership
By: UK Investment Plan 1997 Partners,
Inc. as general partner
By: /s/ Ivy Dodes
--------------------------------------
Name: Ivy Dodes
Title: Vice President
Address: c/o DLJ Merchant Banking II,
Inc.
277 Park Avenue
New York, NY 10172
Fax: 212-892-7272
MADISON DEARBORN CAPITAL
PARTNERS II, L.P.
By: Madison Dearborn Partners II, L.P.,
its General Partner
By: Madison Dearborn Partners, Inc.,
its General Partner
By: /s/ David F. Mosher
--------------------------------------
Name: David F. Mosher
Title: Managing Director
Address: 3 First National Plaza
Suite 3800
Chicago, Illinois 60602
Fax: 312-895-1226
<PAGE>
EAGLE RIVER INVESTMENTS, LLC,
a Washington limited liability company
By: /s/ C. James Judson
--------------------------------------
Name: C. James Judson
Title: Vice President
Address: 2300 Carillon Point
Kirkland, WA 98033-7353
Fax: 425-828-8061
MOTOROLA, INC., a Delaware corporation
By: /s/ Dan Coombes
--------------------------------------
Name: Dan Coombes
Title: Senior Vice President and
General Manager Network
Systems Group
Address: 1303 E. Algonquin Road
Schaumberg, Illinois 60196
Attn.: General Counsel
Fax: 847-576-3628
CASCADE INVESTMENTS, L.L.C.
By: /s/ Michael Larson
--------------------------------------
Name: Michael Larson
Title: Business Manager
Address: 2365 Carillon Point
Kirkland, Washington 98033
Attention: Michael Larson
Fax: 425-889-0288
<PAGE>
MADRONA INVESTMENT GROUP, L.L.C.
By: /s/ Tom A. Alberg
--------------------------------------
Name: Tom A. Alberg
Title: Principal
Address: 1000 Second Avenue
Suite 3700
Seattle, Washington 98014
Attention: Tom Alberg
Fax: 206-674-3010
AMPERSAND HOLDINGS, L.L.C.
By: /s/ Gregory J. Parker
--------------------------------------
Name: Gregory J. Parker
Title: President
Address: 1301 Santa Barbara Street
Santa Barbara, California
93101
Attention: Gregory Parker
Fax: 805-963-7801
STEVE HOOPER
/s/ Steve Hooper
-----------------------------------------
Address: 4001 Hunts Point Road
Bellevue, Washington 98004
Fax: 425-462-9891
ARTHUR HARRIGAN
/s/ Arthur Harrigan
-----------------------------------------
Address: 2300 Carillon Point
Kirkland, Washington
Fax: 425-828-8061
<PAGE>
JOHN CHAPPLE
/s/ John Chapple
-----------------------------------------
Address: 4500 Carillon Point
Kirkland, Washington 98033
Fax: 425-828-8098
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Molly S. Fergusson
--------------------------------------
Name: Molly S. Fergusson
Title: Manager, Operations
Address: c/o GE Capital Services
Structured Finance Group,
Inc.
120 Long Ridge Road
Stamford, CT 06927
Attention: Portfolio-
Operations
Fax: 203-961-2017
NMS CAPITAL, L.P.
By: NMS Capital Management, LLC,
the sole General Partner
By: /s/ Paul S. Lattanzio
--------------------------------------
Name: Paul S. Lattanzio
Title: Member
Address: 9 West 57th Street
48th Floor
New York, NY 10019
Attn: Paul S. Lattanzio
Fax: 212-583-8273
<PAGE>
ARES LEVERAGED INVESTMENT FUND, L.P.
By: ARES Management, L.P.
By: ARES Operating Member, LLC,
its General Partner
By: /s/ Jeffrey Serota
--------------------------------------
Name: Jeffrey Serota
Title: Vice President
Address: 1999 Avenue of the Stars
Suite 1900
Los Angeles, CA 90067
Fax: 310-201-4170
ARES LEVERAGED INVESTMENT
FUND II, L.P.
By: ARES Management II, L.P.
By: ARES Operating Member II, LLC,
its General Partner
By: /s/ Jeffrey Serota
--------------------------------------
Name: Jeffrey Serota
Title: Vice President
Address: 1999 Avenue of the Stars
Suite 1900
Los Angeles, CA 90067
Fax: 310-201-4170
<PAGE>
THE HUFF ALTERNATIVE INCOME FUND, L.P.
By: /s/ Donna B. Charlton
--------------------------------------
Name: Donna B. Charlton
Title: President of General Manager
Address: 1776 On the Green
67 Park Place
Morristown, NJ 07960
Fax: 973-984-5818
TCW/CRESCENT MEZZANINE PARTNERS II, L.P.
TCW/CRESCENT MEZZANINE TRUST II
By: TCW/CRESCENT MEZZANINE II, L.P.,
its general partner or managing owner
By: TCW/CRESCENT MEZZANINE, L.L.C.,
its general partner
By: /s/ John C. Rocchio
--------------------------------------
Name: John C. Rocchio
Title: Managing Director
Address: 1776 On the Green
Address: 11100 Santa Monica Blvd.,
Suite 2000
Los Angeles, CA 90025
Fax: 310-235-5967
<PAGE>
TCW SHARED OPPORTUNITY FUND III, L.P.
By: TCW ASSET MANAGEMENT COMPANY,
as Investment Advisor
By: /s/ Robert D. Beyer
--------------------------------------
Name: Robert D. Beyer
Title: Group Managing Director
By: /s/ John C. Rocchio
--------------------------------------
Name: John C. Rocchio
Title: Managing Director
Address: 11100 Santa Monica Blvd.,
Suite 2000
Los Angeles, CA 90025
Fax: 310-235-5967
SHARED OPPORTUNITY FUND IIB, LLC
By: TCW ASSET MANAGEMENT COMPANY,
as Investment Advisor
By: /s/ Robert D. Beyer
--------------------------------------
Name: Robert D. Beyer
Title: Group Managing Director
By: /s/ John C. Rocchio
--------------------------------------
Name: John C. Rocchio
Title: Managing Director
Address: 11100 Santa Monica Blvd.,
Suite 2000
Los Angeles, CA 90025
Fax: 310-235-5967
<PAGE>
TCW SHARED OPPORTUNITY FUND II, L.P.
By: TCW INVESTMENT MANAGEMENT
COMPANY, as Investment Advisor
By: /s/ Robert D. Beyer
--------------------------------------
Name: Robert D. Beyer
Title: Group Managing Director
By: /s/ John C. Rocchio
--------------------------------------
Name: John C. Rocchio
Title: Managing Director
Address: 11100 Santa Monica Blvd.,
Suite 2000
Los Angeles, CA 90025
Fax: 310-235-5967
TCW LEVERAGED INCOME TRUST II, L.P.
By: TCW (LINC II), L.P.,
as General Partner
By: TCW ADVISORS (BERMUDA), LTD.,
as General Partner
By: /s/ Robert D. Beyer
--------------------------------------
Name: Robert D. Beyer
Title: Group Managing Director
By: TCW INVESTMENT MANAGEMENT
COMPANY, as Investment Advisor
By: /s/ John C. Rocchio
--------------------------------------
Name: John C. Rocchio
Title: Managing Director
Address: 11100 Santa Monica Blvd.,
Suite 2000
Los Angeles, CA 90025
Fax: 310-235-5967
<PAGE>
TCW LEVERAGED INCOME TRUST, L.P.
By: TCW (BERMUDA), LIMITED,
as General Partner
By: /s/ Robert D. Beyer
--------------------------------------
Name: Robert D. Beyer
Title: Group Managing Director
By: TCW INVESTMENT MANAGEMENT
COMPANY, as Investment Advisor
By: /s/ John C. Rocchio
--------------------------------------
Name: John C. Rocchio
Title: Managing Director
Address: 11100 Santa Monica Blvd.,
Suite 2000
Los Angeles, CA 90025
Fax: 310-235-5967
<PAGE>
JDT-JRT L.L.C.
By: John D. Thompson, Manager
By: /s/ John D. Thompson
--------------------------------------
Name: John D. Thompson
Title: Manager
JRC COHO L.L.C.
By: John H. Chapple, Manager
By: /s/ John D. Chapple
--------------------------------------
Name: John D. Chapple
Title: Manager
