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TDS Agreement
Execution Copy
TDS STOCKHOLDERS AGREEMENT
This TDS Stockholders Agreement (this "Agreement") dated as of
August 26, 2000 among Powertel, Inc., a Delaware corporation ("Powertel") and
the stockholder of VoiceStream listed on the signature page hereto
("Stockholder" ).
WHEREAS, simultaneously with the execution of this Agreement,
VoiceStream Wireless Corporation, a Delaware corporation ("VoiceStream") and
Powertel are entering into an Agreement and Plan of Merger (the "Powertel Merger
Agreement"), dated as of the date hereof, providing, among other things, for the
merger of a subsidiary of VoiceStream with and into Powertel (the "Merger") ;
WHEREAS, Powertel has agreed to enter into the Powertel Merger
Agreement only if the VoiceStream Principal Stockholders enter into a
VoiceStream Voting Agreement, including this Agreement;
WHEREAS, in the Powertel Merger Agreement VoiceStream has
agreed, subject to the conditions set forth therein, to acquire all of the
shares of Powertel Common Stock (as defined below);
NOW THEREFORE, in consideration of the foregoing and the
mutual premises, representations, warranties, covenants and agreements contained
herein and in the Merger Agreement, the parties hereto, intending to be legally
bound hereby, except as set forth in the Side Agreement between Stockholder and
Powertel dated the date hereof (the "Side Agreement"), agree as follows:
1. Certain Definitions.
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This Agreement is one of the VoiceStream Voting Agreements
referenced in the recitals to the Powertel Merger Agreement. For the purposes of
this Agreement, all capitalized terms used but not otherwise defined herein
shall have the respective meanings given to such terms in the Powertel Merger
Agreement.
For the purposes of this Agreement, the words "beneficially
owned" or "beneficial ownership" shall include, with respect to any securities,
the beneficial ownership by Stockholder and by any direct or indirect Subsidiary
of Stockholder.
"Transfer" means, with respect to any security, the sale,
transfer, pledge, hypothecation, encumbrance, assignment or other disposition of
such security or the record or beneficial ownership thereof, the offer to make
such a sale, transfer or other disposition, and each agreement, arrangement or
understanding, whether or not in writing, to effect any of the foregoing.
2. Representations; Warranties and Covenants of Stockholder.
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Stockholder hereby represents and warrants to Powertel as follows:
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(a) Title. As of the date hereof, Stockholder is the sole
record or beneficial owner of the number of shares of VoiceStream Common Stock
or VoiceStream preferred stock, as the case may be, set forth opposite
Stockholder's name on Exhibit A attached hereto (the "Existing Shares" and,
together with record or beneficial ownership of any shares of VoiceStream Common
Stock or other voting capital stock of VoiceStream acquired after the date
hereof, whether upon the exercise of warrants or options, conversion of
VoiceStream preferred stock or any convertible securities or otherwise,
Stockholder's "Shares"), and/or the number of warrants, options or other rights
to acquire or receive such VoiceStream Common Stock or VoiceStream preferred
stock, as the case may be, set forth opposite such Stockholder's name on Exhibit
A attached hereto (the "Existing Rights" and, together with record or beneficial
ownership of any warrants, options or other rights to acquire or receive such
shares of VoiceStream Common Stock or other voting capital stock of VoiceStream
acquired after the date hereof, Stockholder's "Rights"). Stockholder is the
lawful owner of the Existing Shares and Existing Rights, free and clear of all
liens, claims, charges, security interests or other encumbrances, except as
disclosed on Exhibit A. As of the date hereof, the Existing Shares constitute
all of the capital stock of VoiceStream owned of record or beneficially by
Stockholder (excluding the Existing Rights) and Stockholder does not own of
record or beneficially, or have the right to acquire (whether currently, upon
lapse of time, following the satisfaction of any conditions, upon the occurrence
of any event or any combination of the foregoing) any shares of VoiceStream
Common Stock or VoiceStream preferred stock or any other securities convertible
into or exchangeable or exercisable for shares of VoiceStream Common Stock,
except pursuant to the Existing Rights.
(b) Right to Vote. Except as disclosed on Exhibit A,
Stockholder has, and (subject to the provisions of Section 3(a)) will have at
the VoiceStream Stockholders' Meeting, with respect to all of Stockholder's
Shares listed on Exhibit A and acquired subsequent to the date hereof and prior
to the record date for the VoiceStream Stockholders' Meeting, sole voting power,
sole power of disposition or sole power to issue instructions with respect to
the matters set forth in Section 4 hereof and to fulfill its obligations under
such Section and shall not take any action or grant any person any proxy
(revocable or irrevocable) or power-of-attorney with respect to any Shares or
Rights inconsistent with his or its obligations as provided by Section 4 and
Section 5 hereof. Stockholder hereby revokes any and all proxies with respect to
Stockholder's Existing Shares to the extent they are inconsistent with
Stockholder's obligations under this Agreement.
(c) Authority. Stockholder has full legal power, authority,
legal capacity and right to execute and deliver, and to perform its or his
obligations under, this Agreement. No proceedings or actions on the part of
Stockholder other than those already taken are necessary to authorize the
execution, delivery or performance of this Agreement or the consummation of the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Stockholder and constitutes a valid and binding
agreement of such Stockholder enforceable against Stockholder in accordance with
its terms, subject to (i) bankruptcy, insolvency, moratorium and other similar
laws now or hereafter in effect relating to or affecting creditors rights
generally and (ii) general principles of equity (regardless of whether
considered in a proceeding at law or in equity).
(d) Conflicting Instruments. Neither the execution and
delivery of this Agreement nor the performance by Stockholder of its agreements
and obligations hereunder will
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result in any breach or violation of, or be in conflict with or constitute a
default under, any term of any agreement, judgment, injunction, order, decree,
federal law or regulation to which Stockholder is a party or by which
Stockholder (or any of its assets) is bound.
(e) Powertel's Reliance. Stockholder understands and
acknowledges that Powertel is entering into the Powertel Merger Agreement
in reliance upon Stockholder's execution, delivery and
performance of this Agreement.
3. Restriction on Transfer; Other Restrictions.
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(a) From the date hereof until the later of January 1, 2001
and the date of the VoiceStream Stockholders' Meeting, Stockholder agrees not to
Transfer any Shares or Rights owned of record or beneficially by Stockholder,
except as otherwise permitted by this Section 3 or pursuant to the Powertel
Merger Agreement or the DT Merger Agreement (including the Stockholder
Agreements entered into in connection therewith), Transfers to any Affiliate of
the Stockholder who agrees in writing to be bound by the terms of this Agreement
or Transfers which occur by operation of law if the transferee remains, or
agrees in writing to remain, bound by the terms of this Agreement, other than,
in each case, with Powertel's prior written consent, provided, however, that
this Section 3(a) shall cease to be of any force or effect immediately upon
termination of the Powertel Merger Agreement.
(b) Stockholder agrees that if at any time during the period
beginning on the later of January 1, 2001 and the date of the VoiceStream
Stockholders' Meeting and continuing until the first to occur of (1) the
Effective Time and (2) the termination of the Powertel Merger Agreement,
Stockholder proposes to Transfer, or exercise or propose to exercise
registration rights with respect to, more than 25% of the Stockholders' Shares
(individually or in the aggregate with other Transfers made during such period),
Stockholder will notify the Powertel stockholders listed on Exhibit B attached
hereto (the "Powertel Stockholders") in writing at the addresses set forth on
Exhibit B at least three Business Days in advance of such proposed Transfer or
exercise of rights, whichever is first to occur, and shall waive any right of
Stockholder to preclude or delay the filing of a registration statement or a
Transfer by the Powertel Stockholders with respect to Powertel Stock up to the
amounts permitted under Section 3.3 of such Powertel Stockholders' Powertel
Stockholders Agreements with VoiceStream (as such amounts may be increased by
the provisions of such Section 3.3).
(c) Stockholder agrees that if at any time during the period
beginning on the Effective Time through and including the six (6) month
anniversary of the Effective Time, Stockholder proposes to Transfer, or exercise
or propose to exercise registration rights with respect to more than such number
of Shares that Stockholder is permitted to Transfer under Rule 144 promulgated
under the Securities Act, including the volume restriction contained therein
(individually or in the aggregate with other Transfers made during such period),
Stockholder will notify the Powertel Stockholders in writing at least three
Business Days in advance of such proposed Transfer or exercise of rights,
whichever is first to occur, and, at Stockholder's option, either (i) allow each
Powertel Stockholder to include a proportionate percentage (i.e., a percentage
equivalent to the ratio of the total number of Shares offered for sale by the
Stockholders to the total number of Shares beneficially owned by the
Stockholders) of the total number of shares of VoiceStream Common Stock
beneficially owned by such Powertel
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Stockholder in any registration statement requested to be filed by the
Stockholders or (ii) shall waive any right that Stockholder may have to preclude
or delay the filing of a registration statement by any of the Powertel
Stockholders covering a number of shares up to that permitted under Section 3.4
of such Powertel Stockholders' Powertel Stockholders Agreements with VoiceStream
(as such number may be increased by the provisions of such Section 3.4).
4. Agreement to Vote.
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Stockholder hereby irrevocably and unconditionally agrees to vote or to cause to
be voted or provide a consent with respect to, all Shares that he, she or it
owns of record or beneficially as of the record date for the VoiceStream
Stockholders' Meeting at the VoiceStream Stockholders' Meeting and at any other
annual or special meeting of stockholders of VoiceStream or action by written
consent where such matters arise in favor of the Powertel Merger Agreement and,
if required, the other transactions referenced in the Powertel Merger Agreement,
and against the liquidation or winding up of VoiceStream.
5. Delivery of Proxy.
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In furtherance of the agreements contained in Section 4 hereof, Stockholder
hereby agrees (a) to complete and send the proxy card received by such
Stockholder with the Joint Proxy Statement, so that such proxy card is received
by VoiceStream, as prescribed by the Joint Proxy Statement, not later than the
fifth Business Day preceding the day of the VoiceStream Stockholders Meeting,
(b) to vote, by completing such proxy card but not otherwise, all the Shares he,
she or it owns of record or beneficially as of the record date for the
VoiceStream Stockholder' Meeting (i) in favor of the Powertel Merger Agreement
and, if required, the other transactions referenced in the Powertel Merger
Agreement and (ii) if the opportunity to do so is presented to Stockholder on
the proxy card, against the liquidation or winding up of VoiceStream and (c) not
to revoke any such proxy.
6. Amendment of Existing Voting Agreements.
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Stockholder and certain other stockholders of VoiceStream are parties to a
Voting Agreement dated February 25, 2000 (as amended May 4, 2000), and a certain
First Amended and Restated Voting Agreement dated July 23, 2000 which will take
effect in accordance with its terms (collectively the "Existing Voting
Agreements") pursuant to which they have agreed to vote all shares of
VoiceStream Common Stock and VoiceStream preferred stock beneficially owned by
each of them at the time of such vote in the election of directors in accordance
with the procedures and provisions set forth in such agreements. On or before
the Effective Time, provided that the Stockholder is still subject to the
Existing Voting Agreements, Stockholder agrees to execute and deliver, and
VoiceStream agrees that it will make commercially reasonable efforts to cause
the other parties to the Existing Voting Agreements to execute and deliver, an
amendment to the Existing Voting Agreements (the "Amended Voting Agreement") on
terms mutually satisfactory to VoiceStream, Stockholder, the Powertel Principal
Stockholders (who will become parties to the Amended Voting Agreement), and the
other parties who are presently parties to the Existing Voting Agreements,
providing for: (i) the nomination of one representative of the Powertel
stockholders to the VoiceStream Board of Directors who shall be initially
designated by the Powertel Board of Directors and who shall also be reasonably
satisfactory to VoiceStream; (ii) the creation of a vacancy on the VoiceStream
Board of Directors (and the approval of any Bylaw amendments or other actions
required to do so); (iii) the appointment of such nominee (and any successor
nominee) to a newly created vacancy on the VoiceStream Board of Directors; and
(iv) an agreement to vote all shares of VoiceStream Common Stock and other
voting securities of VoiceStream (and all securities received in exchange,
replacement or substitution therefore, or as
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a dividend or result of a stock split with respect thereto) owned of record or
beneficially by the Stockholder at the time of such vote for such nominee (and
any successor nominee) at the first two annual meetings after the Effective
Time. If VoiceStream, Stockholder and the other parties to the Existing Voting
Agreements are unable to cause the execution of an Amended Voting Agreement,
Stockholder agrees to execute a separate voting agreement with the Powertel
Principal Stockholders and such other VoiceStream stockholders who agree to
enter into such separate voting agreement on terms and conditions substantially
similar to the Existing Voting Agreements making the same additional provisions
as set forth in the preceding sentence. Prior to the Effective Time, the
Powertel Board of Directors may make such provisions as it deems appropriate for
successor nominees each of which shall be reasonably satisfactory to
VoiceStream. After the Effective Time, any nominee or successor nominee shall be
selected by mutual agreement of ITC Holding Company, Inc., a Delaware
corporation ("ITCORP") and SCANA Communications Holdings, Inc., a Delaware
corporation ("SCORP") or, if no such agreement can be reached, by whichever of
ITCORP and SCORP beneficially owns the larger number of shares of VoiceStream
Common Stock and VoiceStream preferred stock (on an as-if-converted basis).
7. Additional Shares and Additional Rights.
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If, after the date hereof, Stockholder acquires record or beneficial ownership
of any additional shares of capital stock of VoiceStream (any such shares,
"Additional Shares"), including, without limitation, upon exercise of any
option, warrant or right to acquire shares of capital stock of VoiceStream,
through the conversion of the VoiceStream preferred stock or through any stock
dividend or stock split (any such options, warrants or rights, "Additional
Rights"), the provisions of this Agreement applicable to the Shares shall be
applicable to such Additional Shares and Additional Rights from and after the
date of acquisition thereof. The provisions of the immediately preceding
sentence shall be effective with respect to Additional Shares without action by
any Person immediately upon the acquisition by Stockholder of record or
beneficial ownership of such Additional Shares or Additional Rights.
8. Miscellaneous.
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(a) Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof.
(b) Costs and Expenses. All costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such expenses.
(c) Invalid Provisions. If any provision of this Agreement
shall be invalid or unenforceable under applicable law, such provision shall be
ineffective to the extent of such invalidity or unenforceability only, without
it affecting the remaining provisions of this Agreement.
(d) Execution in Counterparts. This Agreement may be executed
in counterparts transmitted and delivered by facsimile each of which shall be an
original with the same effect as if the signatures hereto and thereto were upon
the same instrument.
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(e) Specific Performance. Stockholder agrees with Powertel as
to himself or itself that if for any reason Stockholder fails to perform any of
his or its agreements or obligations under this Agreement, irreparable harm or
injury to Powertel would be caused as to which money damages would not be an
adequate remedy. Accordingly, Stockholder agrees that, in seeking to enforce
this Agreement against Stockholder, Powertel shall be entitled, in addition to
any other remedy available at law, equity or otherwise, to specific performance
and injunctive and other equitable relief. The provisions of this Section 8(e)
are without prejudice to any other rights or remedies, whether at law or in
equity, that Powertel may have against Stockholder for any failure to perform
any of its agreements or obligations under this Agreement.
(f) Amendments; Termination.
(i) This Agreement, including this Section 8(f), may not be
modified, amended, altered or supplemented, except upon the
execution and delivery of a written agreement executed by the
parties hereto.
(ii) The provisions of this Agreement (other than Sections
3, 4 and 6) shall terminate upon the earliest to occur of (A) the
consummation of the Merger, (B) the date that is two (2) years
after the date hereof, and (C) the termination of the Merger
Agreement. The provisions of Sections 3(a), 3(b) and 4 of this
Agreement shall terminate when the applicable time periods set
forth in Section 3 lapse, and the provisions of Section 3(c) shall
terminate on the earlier of the six (6) month anniversary of the
Effective Time or upon the termination of the Powertel Merger
Agreement. The provisions of Section 6 shall terminate upon
earlier of the execution and delivery of a new or amended voting
agreement or the termination of the Powertel Merger Agreement.
(g) Governing Law; Submission and Jurisdiction.
(i) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without giving
effect to the principles of conflicts of laws thereof.
(ii) Each of the parties hereto irrevocably agrees that any
legal action or proceeding with respect to this Agreement or for
recognition and enforcement of any judgment in respect hereof
brought by the other party hereto or its successors or assigns
shall be brought and determined only in the United States District
Court for the State of Delaware or, in the event (but only in the
event) that such court does not have subject matter jurisdiction
over such action or proceeding, in the courts of the State of
Delaware. Each of the parties hereto hereby irrevocable submits
with regard to any such action or proceeding for itself and in
respect to its property, generally and unconditionally, to the
personal jurisdiction of the aforesaid courts. Each of the parties
hereto hereby irrevocably waives, and agrees not to assert, by way
of motion, as a defense, counterclaim or otherwise, in any action
or proceeding with respect to this Agreement, (A) any claim that
it is not personally subject to the jurisdiction of the
above-named courts for any reason other than the failure to serve
in accordance with this Section 8(g)(ii) or that it or its
property is exempt or immune from jurisdiction of any such court
or from any legal process commenced in such courts (whether
through service
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of notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or otherwise), and
(B) to the fullest extent permitted by the applicable law, that
(x) the suit, action or proceeding in such court is brought in an
inconvenient forum, (y) the venue of such suit, action or
proceeding is improper and (z) this Agreement, or the subject
matter hereof, may not be enforced in or by such courts. Without
limiting the foregoing, each party agrees that service of process
on such party as provided in Section 8(i) shall be deemed
effective service of process on such party.
(h) Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective legal successors (including, in the case of Stockholder or any other
individual, any executors, administrators, estates, legal representatives and
heirs of Stockholder or such individual) and permitted assigns; provided that,
except as otherwise provided in this Agreement, no party may assign, delegate or
otherwise transfer any of its rights or obligations under this Agreement.
(i) Notices. All notices and other communications given or
made pursuant hereto shall be in writing and shall be deemed to have been duly
given or made as of the date of receipt and shall be delivered personally or
sent by overnight courier or sent by telecopy, to the Parties at the following
addresses or telecopy numbers (or at such other address or telecopy number for a
party as shall be specified by like notice):
(i) if to Stockholder, at Stockholder's address appearing on
Exhibit A hereto or at any other address that Stockholder may have
provided in writing to Powertel,
with a copy to:
Preston Gates & Ellis LLP
701 Fifth Avenue, Suite 5000
Seattle, WA 98104
Attn: Richard B. Dodd, Esq.
Telecopy No: 206-623-7022
And a copy to:
Friedman, Kaplan & Seiler LLP
875 Third Avenue
New York, New York 10022
Attention: Barry A. Adelman
Facsimile: 212-355-6401
(ii) if to Powertel:
Powertel, Inc.
1239 O.G. Skinner Drive
West Point, GA 31833
Attention: Chairman of the Board
Facsimile: 706-645-9563
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with a copy to:
Morris Manning & Martin, L.L.P.
1600 Atlanta Financial Center
3343 Peachtree Road, NE
Atlanta, Georgia 30326
Attention: James Walker IV
Facsimile: 404-365-9532
(j) Third Party Beneficiaries. This Agreement is entered into
solely for the benefit of the parties hereto and no person other than such
parties, and their respective successors and permitted assigns to the extent
expressly provided herein, may exercise any right or enforce any obligation
hereunder; provided, however, that the Powertel Stockholders shall be deemed to
be third party beneficiaries of this Agreement solely with respect to the
notification provisions contained in Sections 3(b) and 3(c) hereof.
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STOCKHOLDERS SIGNATURE PAGE - TDS
IN WITNESS WHEREOF, the parties hereto have executed this TDS
Stockholders Agreement as of this 26th day of August, 2000.
POWERTEL, INC.
By: /s/ Allen E. Smith
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Name: Allen E. Smith
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Title: President and CEO
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TELEPHONE AND DATA SYSTEMS, INC.
By: /s/ Sandra L. Helton
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Name: Sandra L. Helton
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Title: Executive Vice President,
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Finance and CEO
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VoiceStream Wireless Corporation hereby agrees with Powertel, Inc. that
it agrees to comply with the provisions of Section 6 of the TDS Stockholder
Agreement dated August 26, 2000 between Powertel, Inc. and Telephone and Data
Systems, Inc.
VOICESTREAM WIRELESS CORPORATION
By: /s/ Cregg Baumbaugh
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Name: Cregg Baumbaugh
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Title: Executive Vice President -
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Finance, Strategy & Development
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EXHIBIT A
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Stockholder Name and Address Number of Existing Shares Number and Description of Existing Rights
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Telephone and Data Systems, Inc. 35,570,493 None
30 North LaSalle, Suite 4000
Chicago, IL 60602
Attention: LeRoy T. Carlson, Jr.,President
Facsimile: 312-630-9299
The Shares listed above are subject to a Stockholders Agreement executed among
the Stockholder and Deutsche Telekom AG, dated as of July 23, 2000 and an
Investor Agreement between Stockholder and VoiceStream dated as of September 17,
1999.
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EXHIBIT B
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Powertel Stockholders
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ITC Holding Corporation, Inc. 614 West Bay Street
ITC Service Company Tampa, FL 33606-2704
ITC Wireless, Inc.
3300 20th Avenue Above Address for the following Stockholders:
Valley, AL 36854
Donald W. Burton
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Sonera Holding, B.V. The Burton Partnership, L.P., Donald W. Burton, General
c/o Sonera Corporation Partner
P.O. Box 106
FIN-00051-SONERA The Burton Partnership (QP), L.P., Donald W. Burton,
Teollisuuskatu 15, Helsinki General Partner
Attn: Kaj-Erik Relander,
Deputy Chief Executive Officer
Facsimile: 011 358 2040 3770
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Sonera Corporation South Atlantic Venture Fund II, L.P., South Atlantic
P.O. Box 106 Venture Partners II, L.P., general partner, of which
FIN-00051-SONERA Mr. Burton is managing general partner
Teollisuuskatu 15, Helsinki
Attn: Kaj-Erik Relander, South Atlantic Venture Fund III, L.P.; South Atlantic
Deputy Chief Executive Officer Partners III, L.P., sole general partner, of which Mr.
Facsimile: 011 358 2040 3770 Burton is chairman
=============================================================================================================
South Atlantic Private Equity Fund IV, L.P.; South
SCANA Communications Holdings, Inc. Atlantic Private Equity Partners IV, sole general
Delaware Avenue, Suite 510 partner, of which Mr. Burton is chairman
Wilmington, DE 19801-1622
=============================================================================================================
American Water Works Company South Atlantic Private Equity Fund IV (QP) L.P.; South
PO Box 1770 Atlantic Private Equity Partners IV, Inc., sole general
Voorhees, NJ 08043 partner, of which Mr. Burton is chairman
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