1
EXHIBIT 10.6
AGREEMENT FOR SALE OF CONDUIT
BETWEEN
QWEST COMMUNICATIONS CORPORATION
("QWEST")
AND
NORTH AMERICAN DATACOM, INC.
("BUYER")
DATE: MARCH 31, 2000
2
TABLE OF CONTENTS
SCHEDULE OF EXHIBITS
EXHIBIT A Qwest System Route
EXHIBIT B Qwest Construction Specifications
EXHIBIT C Right of Way Occupancy Agreement
EXHIBIT D As-built Drawing Specifications
EXHIBIT E ▇▇▇▇ of Sale
EXHIBIT F Fiber Optic Cable Specification
EXHIBIT G Qwest's Maintenance Specifications and Procedures
EXHIBIT I Guaranty Agreement
- i -
3
AGREEMENT FOR SALE OF CONDUIT
THIS AGREEMENT FOR SALE OF CONDUIT ("Agreement"), is made and entered
into as of the 31st day of March, 2000 (the "Effective Date"), by and between
Qwest Communications Corporation, a Delaware corporation ("Qwest") and North
American DataCom, Inc., a Delaware corporation ("Buyer").
RECITALS:
A. Qwest has installed multiple conduit systems approximately
five hundred and four (504) miles in length, a part of which
is located on the railroad right of way of CSX Transportation,
Inc. (the "Railroad") and part of which is located on public
right of way (the "Qwest System Route") and
B. Buyer desires to purchase from Qwest and Qwest desires to sell
to Buyer one (1) conduit and associated improvements within
the multiple conduit systems constructed by Qwest in the Qwest
System Route.
NOW THEREFORE, for and in consideration of the mutual covenants and
agreements herein contained and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. Construction and Sale of Conduit. As of the Effective Date of this Agreement,
Qwest agrees to convey to Buyer, and Buyer agrees to purchase from Qwest, one
(1) one and one-quarter-inch (1-1/4") diameter SDR 11 high density polyethylene
(HDPE) conduit (the "Buyer Conduit"), constructed by Qwest, and handholes,
manholes and other ancillary improvements to be constructed by Qwest (the
"Ancillary Facilities"), as described in those certain specifications attached
hereto as Exhibit B and incorporated herein by this reference (the
"Specifications").
On execution of this Agreement by both parties, Qwest shall convey good
and clear title to the Buyer Conduit, free and clear of all liens and
encumbrances, to Buyer. Transfer of title shall be evidenced by a ▇▇▇▇ of sale
substantially in the form attached hereto as Exhibit E.
2. Services.
2.1 The term "Services", as used in this Agreement, shall mean any
physical activity or contact with the rights of way or conduit in the Qwest
System Route involved in the preparation of installation of fiber cable by
Buyer, or by Qwest at the request of Buyer, including, but not limited to, the
placing of handholes or manholes, the pulling of fiber cable, the testing of
fibers, the construction of Ancillary Facilities, and the rodding and roping of
conduit.
2.2 Qwest will install handholes or manholes at standard intervals
along the Qwest System Route for Buyer's exclusive use in accordance with the
construction Specifications. A
4
standard interval means a minimum of one handhole or manhole approximately every
5000 feet in the general vicinity of existing Qwest handholes or manholes.
2.3 Provided that Buyer gives Qwest notice of additional requirements
prior to the completion of the construction of the standard handholes or
manholes, Qwest will install additional Ancillary Facilities at such other
locations as requested by Buyer, at Buyer's expense, subject to the underlying
rights requirements and subject to approval by the permitting agency, and
provided that such installation does not materially interfere with Qwest's
existing facilities.
In addition, provided that Buyer gives Qwest notice of additional
requirements prior to the completion of the construction, Qwest shall install,
splice and test a single fiber optic cable within the Buyer Conduit and
Ancillary Facilities in accordance with the fiber specifications attached hereto
as Exhibit F. The cable will be supplied to Qwest by Buyer at Buyer's sole cost
and expense and in accordance with delivery terms to be agreed to between the
parties. Buyer shall retain title to the fiber optic cable.
The charge to Buyer for such additional Services shall be as follows:
Pulling of fiber $.87 per foot
Splicing of fiber $70.00 per fiber
Placing of handholes $1,500 each
Placing of manholes $5,000 each
2.4 Each party shall be responsible for the proper design and
maintenance of its cable and other equipment which occupies shared right of way
systems or other facilities, and shall perform work in shared conduit systems
and other facilities in a safe and workmanlike manner. Each party shall
permanently identify, by tags or other suitable means, all of its cables and
other equipment which are placed in shared conduit systems or other facilities.
3. Right-of-Way. Contemporaneously with the execution of this Agreement, Qwest
shall arrange for the grant to Buyer, a right of way agreement for Buyer to
access, operate and maintain the Buyer Conduit and Ancillary Facilities in the
portion of the Qwest System Route acquired by Qwest from the Railroad. With
respect to those portions of the Qwest System Route located within public right
of way, Buyer shall be responsible for acquiring any permits or other rights
required for its use of the Buyer Conduit and Ancillary Facilities. A right of
way fee is payable to the Railroad by Qwest by reason of this transaction by the
terms of that certain Letter Agreement dated March 1, 1995 between Qwest and the
Railroad. If the fee due to the Railroad by reason of this transaction is
reduced because Buyer is a party to this Agreement, Qwest will pass on the
savings to Buyer.
4. Payment.
4.1 Purchase Price. The purchase price for the Buyer Conduit shall be
$15,120,000 (the "Purchase Price"). The Purchase Price shall be paid to Qwest as
follows:
- 2 -
5
(a) $2,000,000 shall be payable no later than May 15, 2000;
(b) $4,048,000 shall be payable on or before May 30, 2000;
(c) 20% shall be payable on or before September 30, 2000;
(d) 20% shall be payable on or before December 31, 2000; and
(e) the entire balance shall be payable on or before March 31,
2001.
4.2 Compensation for Services. Buyer shall pay Qwest additional
consideration for placement and splicing of a single fiber optic cable to be
provided by Buyer and installed by Qwest and for the Ancillary Facilities. The
compensation for such services and materials shall be payable by Buyer to Qwest
upon completion of the services.
4.3 Guaranty of Payment. Pursuant to the terms and conditions of a
Guarantee Agreement dated March 31, 2000 and executed between ▇▇. ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ (the "Guarantor") and Qwest (the "Guaranty"), the Guarantor has
personally guaranteed Buyer's prompt and satisfactory performance of this
Agreement according to all of the terms and conditions herein. Should Buyer fail
to promptly and satisfactorily perform any of Buyer's obligations pursuant to
this Agreement, Guarantor shall be liable to Qwest for all expenses, costs and
damages that Qwest is entitled to recover from Buyer in accordance with the
terms and conditions of this Agreement and the Guarantee, a copy of which is
attached hereto as Exhibit I.
5. As-Built Drawings. Within ninety (90) days after completion of the additional
services and construction of additional Ancillary Facilities, Qwest shall
furnish to the Buyer updated as-built drawings of the Buyer Conduit and
Ancillary Facilities, together with a 3.5" CAD system disk containing the
drawings which complies with the requirements of the attached Exhibit D. The
drawings shall indicate the horizontal location of the Buyer Conduit and
Ancillary Facilities. Where the placement of the Buyer Conduit results in less
than 42" of cover, the drawings shall also indicate the vertical placement. In
addition, where applicable, the drawings shall conform to the Railroad's
requirements for as-built drawings.
6. Taxes. Buyer shall pay all taxes, assessments or other fees associated with
Buyer's purchase of the Buyer Conduit and Ancillary Facilities, and those
imposed on the Buyer Conduit and the Ancillary Facilities after the Effective
Date, excluding any taxes related to the income of Qwest. Qwest shall pay all
taxes and assessments levied on Qwest's construction of the multiple conduit
systems along the Qwest System Route.
7. Warranty.
7.1 Except for items supplied by Buyer, Qwest warrants that the Buyer
Conduit and Ancillary Facilities have been constructed in accordance with
industry standards and the
- 3 -
6
construction Specifications, and is in compliance with all construction
requirements imposed by applicable laws, statutes, ordinances and regulations,
and is free from material defects, deviations, errors and omissions in the
construction and workmanship.
7.2 Further, Qwest warrants that it is the true and lawful owner of the
Buyer Conduit and the Ancillary Facilities, and that the Buyer Conduit and
Ancillary Facilities are free and clear of all liens and encumbrances.
7.3 EXCEPT AS SET FORTH IN THIS SECTION, QWEST MAKES NO WARRANTY,
EXPRESS OR IMPLIED, WITH RESPECT TO THE CONDUIT, HAND HOLES OR OTHER ASSOCIATED
MATERIALS FOR THE BUYER CONDUIT, INCLUDING ANY WARRANTY OF MERCHANTABILITY AND
FITNESS FOR PARTICULAR PURPOSE, AND ALL SUCH WARRANTIES ARE EXPRESSLY
DISCLAIMED. IN ADDITION, QWEST MAKES NO WARRANTIES OR REPRESENTATIONS OF ANY
TYPE CONCERNING THE INTEGRITY OR PERFORMANCE OF THE MATERIALS FURNISHED BY
BUYER.
7.4 If Buyer discovers any defect in construction within twelve (12)
months following the Effective Date, Qwest shall, within fifteen (15) days of
receiving written notice of such defect from Buyer, correct any such defect
within thirty (30) days thereafter at Qwest's expense or notify Buyer of its
dispute as to any defects recited in Buyer's notice. Should Buyer advise Qwest
that the defect is or will cause immediate damage to its fiber optic cable, then
Qwest shall inspect and repair said defect within forty-eight (48) hours after
receiving such notice.
7.5 With respect to items of materials furnished by Qwest, Qwest agrees
to transfer and assign to Buyer any warranty it may have received from the
manufacturer or supplier, to the extent that such warranty is assignable.
7.6 Qwest's warranty shall extend for, and be limited to, a period of
twelve (12) months following the Effective Date. Buyer's sole and exclusive
remedy for breach of the warranty shall be repair and replacement, at Qwest's
expense, of the portions of the Buyer Conduit and Ancillary Facilities found to
be defective and any other portions affected by such repair or replacement. In
no event shall either party be liable to the other for any direct, special or
consequential damages, including but not limited to lost profits or the cost of
providing alternative service.
8. Legal Requirements.
8.1 Qwest shall be responsible for obtaining and purchasing, on behalf
of the parties, all permits, easements and other governmental approvals required
for Qwest's construction and installation of the multiple conduit systems,
including the preparation of any drawings, studies or reports which are
required. Buyer shall be responsible for obtaining any and all permits, licenses
and other governmental approvals, which are required for Buyer's use and
operation of the Buyer Conduit and Ancillary Facilities.
- 4 -
7
8.2 In implementing the terms of this Agreement, Qwest and Buyer agree
to comply with all applicable local, municipal, state or federal laws, rules,
regulations and orders.
9. Maintenance.
9.1 Maintenance Services. Qwest shall provide Routine Maintenance and
Unscheduled Maintenance pursuant to the terms and conditions set forth in
Qwest's Maintenance Specifications and Procedures, a copy of which is attached
hereto as Exhibit G, and this Section 9 ("Maintenance Services"). All
capitalized terms used in this Section 9 which are not otherwise defined in this
Agreement shall have their respective meanings as set forth in Qwest's
Maintenance Specifications and Procedures attached hereto as Exhibit G.
9.2 Scheduled Maintenance. Qwest shall provide Scheduled Maintenance on
the Qwest System Route to Buyer throughout the term of Maintenance Services as
provided in Section 9.5 herein. The fee for such Scheduled Maintenance shall be
$25,000 per twelve (12) month term (the "Scheduled Maintenance Fee").
9.3 Unscheduled Maintenance. Any Unscheduled Maintenance to be
performed on the Qwest System Route throughout the term of Maintenance Services
as provided in Section 9.5 herein shall be performed by Qwest. The Costs of any
Unscheduled Maintenance shall be allocated among the various Interest Holders in
the conduit, cable and/or fibers affected thereby as follows: (i) Costs of
Unscheduled Maintenance solely to or affecting a conduit or Cable which houses
fibers of a single interest holder shall be borne 100% by such interest holder;
(ii) Costs of Unscheduled Maintenance to or affecting a conduit which houses
multiple innerduct conduits, not including such Costs attributable to the repair
or replacement of fiber therein, shall be borne proportionately by the interest
holders in each of the affected innerduct conduits based on the ratio that such
affected conduit bears to the total number of affected innerduct conduits, and
(iii) Costs of Unscheduled Maintenance attributable to the repair or replacement
of fiber, including the acquisition, installation, inspection, testing and
splicing thereof, shall be borne proportionately by the interest holders in the
affected fiber, based on the ratio that the number of affected fibers subject to
the interest of each such interest holder bears to the total number of affected
fibers.
9.4 Payment of Maintenance Fees. On or before May 31, 2000, Buyer shall
pay to Qwest the $25,000 Scheduled Maintenance Fee for the Initial Maintenance
Term. The Costs of any Unscheduled Maintenance which are allocated to Buyer
pursuant to the foregoing provisions shall be the responsibility of and paid by
Buyer within thirty (30) days after its receipt from Qwest of an invoice
therefor.
9.5 Term of Maintenance Agreement; Extension. Maintenance Services, as
described in this Section 9 and as more definitively described in the
Maintenance Specifications and Procedures attached hereto as Exhibit G, shall
begin upon the Effective Date of this Agreement and shall terminate upon the
earlier of: (i) the initiation of Services by Buyer, (ii) the completion of
Services by Qwest, at the request of Buyer, or (iii) twelve (12) months
following the Effective Date of this Agreement (the "Initial Maintenance Term").
If the Initial Maintenance Term should
- 5 -
8
terminate due to expiration of the twelve (12) month period immediately
following the Effective Date of this Agreement, Buyer shall have the option,
upon written notice to Qwest not later than sixty (60) days preceding the
conclusion of the initial twelve (12) month period immediately following the
Effective Date of this Agreement and payment in full of an additional Scheduled
Maintenance Fee of $25,000, to extend the term of Maintenance Services for one
(1) additional period of twelve (12) months immediately following the expiration
of the Initial Maintenance Term (the "Extended Maintenance Term"). The Extended
Maintenance Term shall begin immediately following the conclusion of the Initial
Maintenance Term and continue until the earlier of: (i) the initiation of
Services by Buyer, (ii) the completion of Services by Qwest, at the request of
Buyer, or (iii) twenty-four (24) months following the Effective Date of this
Agreement.
10. Insurance.
10.1 During the period of construction, Qwest shall procure and
maintain in force during this Agreement the following insurance coverage from
companies lawfully approved to do business in the state where the construction
will be performed and with an AM Best financial rating of B+13 or better:
(a) Worker's Compensation Insurance with statutory limits of the
state where the work will be performed;
(b) Employer's Liability Insurance with limits of not less than
$2,000,000 per occurrence.
(c) Commercial General Liability Insurance with limits of not less
than $3,000,000 per occurrence combined single limit for both bodily injury and
property damage and providing coverage for:
(1) premises and operations
(2) products and completed operations; completed operations
coverage shall be maintained one year after the date of
final completion of the work
(3) contractual liability
(4) independent contractor's protective coverage m the event
Qwest shall use subcontractors in the performance of
this Agreement
(5) hoist and crane liability coverage if the work will use
such equipment
(6) explosion, collapse, underground hazards, if the work
will involve blasting, underpinning, undermining,
excavating, burrowing.
(d) Automobile Liability Insurance covering the use of all
owned, non-owned, hired and rented motor vehicles with limits of not less than
$1,000,000 per occurrence for both bodily injury and property damage;
- 6 -
9
10.2 Qwest shall require its subcontractors who may work on this
project to maintain insurance in the types and amounts as would be obtained by a
prudent person to provide adequate protection against loss. In all
circumstances, Qwest shall require subcontractor to carry a minimum of
$1,000,000.00 in Commercial General Liability.
10.3 Buyer and Qwest shall be listed as an additional insured on each
other's policies except Workers Compensation. Promptly following the execution
of this Agreement by both parties, and prior to the expiration dates of expiring
policies, Qwest shall provide Buyer with a certificate of insurance evidencing
such insurance coverage. Evidence of insurance furnished shall contain a clause
stating that Buyer shall be notified in writing prior to any cancellation of; or
any material change or new exclusions in the policy.
10.4 The requirements of the Agreement as to insurance shall not in any
manner limit or qualify the liabilities and obligations of Qwest under this
Agreement or in any way modify Qwest's obligations to indemnify Buyer.
10.5 Qwest's insurance shall be primary insurance and not excess over,
or contributory with, any insurance purchased or maintained by Buyer or its
affiliates.
11. Indemnification.
11.1 Qwest agrees to protect, indemnify and hold harmless Buyer, its
directors, officers, employees, agents and servants (collectively the
"Indemnitees") from and against, and shall dispose of and defend Indemnitees
against any claim or proceeding and pay any judgments and damages suffered or
incurred by Indemnitee with respect to:
(a) any and all claims, demands, losses, liabilities, damages,
interest, penalties and expenses on account of injury to or death of any person
(including the employees and agents of Buyer, Qwest, contractors, subcontractors
and suppliers of Qwest and third parties) or damage to or loss of any property
(including property of Buyer or its agents, Qwest, the Railroad, contractors,
subcontractors and suppliers of Qwest, and third parties) caused by the
negligence, gross negligence or intentional misconduct of Qwest, its
contractors, subcontractors or suppliers, and its or their employees or agents,
in the installation of the Buyer Conduit and Ancillary Facilities; provided such
claim, demand, loss, liability, interest, penalty or expense or damage does not
arise from the negligence or wilful misconduct of the Indemnitee; and
(b) any and all claims, demands, losses, liabilities, damages,
interest, penalties, or expenses from any governmental authority or others for
any actual or asserted failure of Qwest, its contractors, subcontractors, or its
or their agents, to comply, or to comply in a timely manner, with any law,
statute, ordinance, regulation, rule, procedure, or order of any governmental or
quasi-governmental body in the installation of the Buyer Conduit and Ancillary
Facilities (including actual or asserted failure of Qwest to pay taxes as
required); provided, that this indemnity shall not apply to any obligation of
Buyer set forth in this Agreement;
- 7 -
10
(c) any and all claims, demands, losses, liabilities, damages,
interest, penalties, and expenses which an Indemnitee may suffer or incur as a
result of the assertion by the federal or any state or local government or by
any other party, of any claims or actions on account of actual or alleged
contamination, pollution or public or private nuisance, including any claim or
action under any present or future federal, state or local law, statute,
ordinance, rule or regulation delaying with hazardous, toxic, poisonous or
regulated materials, the handling or disposition thereof, and the clean-up or
containment of any emission or release thereof into the environment specifically
including without limitation, the Resource Conservation and Recovery Act, the
Clean Water and Clean Air Acts, the Occupational Safety and Health Act, the
Hazardous Materials Transportation Act, the Comprehensive and Environmental
Response Compensation and Liability Act, the Toxic Substances Control Act, and
the Federal Insecticide, Fungicide and Rodenticide Act as currently constituted,
or as the same may hereafter be amended, supplemented or superseded, which are
caused by the negligence, gross negligence or intentional misconduct of Qwest,
its contractors or subcontractors, or its or their employees or agents, in
performing the services to be provided by Qwest under this Agreement.
(d) any and all claims, demands, interests and penalties or
expenses asserted by Qwest's contractors or subcontractors, materialmen, or
employees of Qwest for work or services performed hereunder. In no event shall
Qwest permit a foreclosure to occur on Buyer's property, which is caused by
Qwest's breach of this Agreement. If it appears that a foreclosure proceeding is
to occur on Buyer's property, Buyer may pay any claim, including interest and
penalties, and if the claim has resulted from a breach of this Agreement by
Qwest, Qwest shall promptly reimburse Buyer.
11.2 Notwithstanding the foregoing provisions, the indemnification does
not apply to the extent arising from the negligence, gross negligence or
intentional misconduct of an Indemnitee.
11.3 Buyer shall notify Qwest of any claims, demands or losses which it
asserts are within Qwest's indemnification obligation hereunder within fifteen
(15) days of the later of the occurrence or Buyer's discovery of such
occurrence, and shall provide Qwest any assistance and information reasonably
available to Buyer for the defense of any such claim. Qwest shall not settle or
compromise any such claims without the prior approval of Buyer, which approval
will not be unreasonably withheld or delayed.
11.4 Buyer agrees to indemnify, defend, and hold Qwest, its
contractors, subcontractors, employees and agents harmless from and against any
and all claims, demands, losses, liabilities, damages, interest, penalties, and
expenses which arise due to failure of Buyer as a result of Buyer's, its agents,
employees or contractors' negligence, gross negligence or intentional misconduct
associated with this Agreement.
11.5 Neither Buyer nor Qwest, nor any of their contractors,
subcontractors, agents, or employees shall be liable for any loss of revenue,
lost profit or other indirect, special or consequential damages suffered as a
result of either party's breach of its obligations hereunder, or as a result of
any of their acts or omissions to act hereunder.
- 8 -
11
12. Force Majeure.
Neither party shall be in default under this Agreement if and to the
extent that any failure or delay in such party's performance of one or more of
its obligations hereunder is caused by any of the following conditions, and such
party's performance of such obligation or obligations, and, if affected, the
Scheduled Completion Date shall be excused and extended for and during the
period of any such delay: act of God; fire; flood; material failures, shortages
or unavailability or other delay in delivery not resulting from the responsible
party's failure to timely place orders therefor; lack of or delay in
transportation; government codes, ordinances, laws, rules, regulations or
restrictions (collectively, "Regulations"), permitting and construction delays
beyond the reasonable control of and arising without the fault or negligence of
the party claiming the delay (provided that Qwest has made timely and reasonable
commercial efforts to obtain said permits); war or civil disorder; strikes or
other labor disputes; failure of a third party to grant or recognize an
Underlying Right (provided that Qwest has made timely and reasonable commercial
efforts to obtain the same); inability of Qwest to obtain track time or access
to the Qwest System; or any other cause beyond the reasonable control of such
party. The party claiming relief under this Article shall notify the other in
writing of the existence of the event relied on and the cessation or termination
of said event, and the party claiming relief shall exercise reasonable
commercial efforts to minimize the time of any such delay.
13. Confidential Information and Ownership of Documents.
13.1 This Agreement and all materials, maps, and other documents which
are marked confidential and disclosed by one party to the other in fulfilling
the provisions and intent of this Agreement, are and shall be confidential.
Neither party shall divulge or otherwise disclose the provisions of this
Agreement to any third party without the prior written consent of the other
party except for those required for the implementation of this Agreement, and to
auditors, attorneys, financial advisors, lenders and prospective lenders,
customers and prospective customers, provided that in each case the recipient
agrees in writing to be bound by the confidentiality provisions set forth in
this section, or unless required by a court order or as otherwise required by
law or in any legal or arbitration proceeding relating to this Agreement. If
either party is required by law or by interrogatories, requests for information
or documents, subpoena, civil investigative demand or similar process to
disclose the provisions of this Agreement or the design information referred to
in this Section, it will provide the other party with prompt prior written
notice of such request or requirement so that such party may seek an appropriate
protective order or waive compliance with this Section. The party whose consent
to disclose information is requested shall respond to such request in writing,
within five (5) working days of the request by either authorizing the disclosure
or advising of its election to seek a protective order, or if such party fails
to respond within the prescribed period, the disclosure shall be deemed
approved.
13.2 The foregoing notwithstanding, Grantee may disclose this Agreement
to customers and prospective customers and their representatives provided that
in each case the customer or prospective customer agrees in writing to be bound
by the confidentiality provisions set forth in this section.
- 9 -
12
14. General.
14.1 Notices. All notices and other communications required or
permitted under this Agreement shall be in writing and shall be given by United
States first class mail, postage prepaid, registered or certified, return
receipt requested, or by hand delivery (including by means of a professional
messenger service) addressed as follows:
To Buyer as follows: North American DataCom, Inc.
Tri-State Commerce Park
Building 1000
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
General Counsel
To Qwest as follows: Qwest Communications Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Any such notice or other communication shall be deemed to be
effective when actually received or refused. Either party may by similar notice
given change the address to which future notices or other communications shall
be sent.
14.2 Damages. Notwithstanding any provision of this Agreement to the
contrary, neither party shall be liable to the other party for any special,
incidental, indirect, punitive or consequential costs, liabilities or damages,
whether foreseeable or not, arising out of, or in connection with, such party's
performance of its obligations under this Agreement.
14.3 Modification. This Agreement may not be rescinded, amended or
otherwise modified except by a writing executed by an authorized representative
of both Qwest and Buyer.
14.4 Assignment. Neither party shall assign or otherwise transfer, by
operation of law or otherwise, any of its rights or obligations under this
Agreement without the express written consent of the other party, which consent
shall not be unreasonably withheld or delayed. Notwithstanding the foregoing,
either party may assign or otherwise transfer without the express written
consent of the other party in connection with: (i) any disposition of all or
substantially all of the assets of either party; (ii) any merger, consolidation
or reorganization of either party; (iii) any assignment, in whole or in part, to
any subsidiary, parent company or other affiliate of either party; (iv) any
collateral assignment, security interest or pledge of this Agreement to a
lender; or (v) any lease, sublease, subeasement, sublicense, indefeasible right
of use, or sale or transfer of, conduit, fiber or similar facilities by either
party within its telecommunications system to any third party users of such
facilities. Neither party shall be released of its obligations under this
Agreement by any assignment permitted under this Section 14.4.
- 10 -
13
14.5 Complete Agreement. This Agreement and any other written agreement
expressly referenced herein represent the entire understanding between Buyer and
Qwest with respect to the installation and sale of the Buyer Conduit and
Ancillary Facilities covered hereunder and incorporate all prior and
contemporaneous understandings, whether written or oral, between the parties.
This Agreement supersedes all other prior oral or written agreements concerning
the installation and sale of the Buyer Conduit and Ancillary Facilities covered
hereunder. This Agreement may not be rescinded, amended, or otherwise modified
except by a writing executed by the authorized representatives of both parties.
14.6 No Personal Liability. Each action or claim against any party
arising under or relating to this Agreement shall be made only against such
party as a corporation, and any liability relating thereto shall be enforceable
only against the corporate assets of such party. No party shall seek to ▇▇▇▇▇▇
the corporate veil or otherwise seek to impose any liability relating to, or
arising from, this Agreement against any shareholder, employee, officer,
director or agent of the other party. Each of such persons is an intended
beneficiary of the mutual promises set forth in this Section and shall be
entitled to enforce the obligations or provisions of this Section.
14.7 Dispute Resolution.
(a) Application. Any claim, controversy or dispute, whether sounding in
contract, statute, tort, fraud, misrepresentation or other legal theory, related
directly or indirectly to this Agreement, whenever brought and whether between
the parties to this Agreement or between one of the parties to this Agreement
and the employees, agents or affiliated businesses of the other party, shall be
resolved by arbitration as prescribed in this section. The Federal Arbitration
Act, 9 U.S.C. ▇▇.▇▇. 1-15, not state law, shall govern the arbitrability of all
claims.
(b) Arbitrator. A single arbitrator engaged in the practice of law who
is knowledgeable about the subject matter of this Agreement shall conduct the
arbitration under the then current rules of the American Arbitration Association
(the "AAA"). The arbitrator shall be selected in accordance with AAA procedures
from a list of qualified people maintained by the AAA. The arbitration shall be
conducted in the regional AAA office in Denver, Colorado, and all expedited
procedures presented by the AAA rules shall apply.
(c) Discovery. There shall be no discovery other than the exchange of
information that is provided to the arbitrator by the parties. Each party shall
bear its own costs and attorneys' fees, and the parties shall share equally the
fees and expenses of the arbitrator. The arbitrator's decision and award shall
be final and binding, and judgment on the award rendered by the arbitrator may
be entered in any court having jurisdiction thereof.
(d) Enforcement. If any party files a judicial or administrative action
asserting claims subject to arbitration as presented herein, and another party
successfully stays such action or compels arbitration of said claims, the party
filing said action shall pay the other party's costs and expenses incurred in
seeking such stay or compelling arbitration, including reasonable attorneys'
fees.
- 11 -
14
14.8 Public Relations. This Agreement shall not be construed as
granting Buyer or Qwest any right to use any of either party's or its
affiliates' trademarks, service marks or trade names, or otherwise refer to
either party in any marketing, promotional or advertising materials or
activities. Without limiting the generality of the foregoing, neither party
shall disclose (i) the terms and conditions of this Agreement, or (ii) the
existence of the Agreement or any contractual relationship between the parties,
and shall not issue any publication or press release relating directly or
indirectly to (i) or (ii) above, without the prior written consent of both
parties.
14.9 Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the day and year first written above.
QWEST COMMUNICATIONS NORTH AMERICAN DATACOM, INC.
CORPORATION
By: By:
---------------------------- -------------------------------
Name: Name:
--------------------------- -----------------------------
Title: Title:
-------------------------- ----------------------------
Date: Date:
--------------------------- ----------------------------
- 12 -
15
EXHIBIT B
Standard Construction Specifications
1.0 General.
The intent of this document is to outline the specifications for
construction of a fiber optic cable system. In all cases, the standards
contained in this document or the standards of the federal, state,
local or private agency having jurisdiction, whichever is stricter,
shall be followed.
2.0 Material.
Steel or PVC conduit shall be minimum schedule 40 wall thickness.
Any exposed steel conduit, brackets or hardware (i.e., bridge
attachments) shall be hot-dipped galvanized after fabrication.
Handholes shall have a minimum load rating of H-20 with sufficient soil
cover.
Manholes shall have a minimum H-20 loading rating.
Buried cable warning tape shall be 3 inches wide and display "Warning:
Buried Fiber Optic Cable," Qwest, and local and emergency One Call
"800" numbers repeated every 24 inches.
Fiber optic cable shall be single armored, unless prohibited by the ROW
Owner, or by codes, laws or regulations.
EMS markers will be fabricated in the lids of handholes.
3.0 Minimum Depths.
(a) Minimum cover required in the placement of conduit shall be 42
inches, except where field conditions dictate otherwise.
(b) At locations where conduit crosses other subsurface utilities or
other structures, the conduit shall be installed to provide adequate
vertical clearance and the applicable minimum depth can be maintained;
otherwise the conduit will be installed under the existing utility or
other structure. If, however, adequate clearance cannot be obtained and
the conduit must be placed above, the cable shall be encased in steel
pipe and HDPE conduit.
Page 1 of 4
16
(c) In rock, the conduit depth shall be:
36"-42" in HDPE,
24"-36" in IIDPE encased in steel,
18"-24" in HDPE or PVC or steel and concrete encased.
PVC or HDPE conduit will be backfilled with 6 inches of select
materials (padding) in rock areas. MDI Polyurethane channel
(Fiber-Rockgard by Chempro, Inc. or equivalent) may be used as
protective cover in lieu of select material padding.
(d) In the case of the use/conversion of existing steel pipelines or
existing conduit systems, the existing depth shall be considered
adequate.
4.0 Buried Cable Warning Tape.
All conduits will be installed with buried cable warning tape except
where existing steel pipelines or existing conduit systems are used.
The warning tape shall generally be placed directly above the conduit.
5.0 Conduit Construction.
Conduits may be placed by means of trenching, plowing, ▇▇▇▇ and bore,
push-pull method, or directional bore. Conduits will generally be
placed on a level grade parallel to the surface, with only gradual
changes in grade elevation.
Steel conduit will be joined with threaded collars or welding.
Conduit crossings of roads maintained by government bodies and railroad
crossings will be encased in steel conduit, except where the cable is
placed with 10 feet or more of cover. In the latter case, HDPE is
adequate.
Conduit placed by the push-pull method (that is, using a push rod,
followed by pulling conduit) may use HDPE, PVC, or steel conduit.
All directional bores will use HDPE or steel conduit.
All conduits placed on bridges shall have expansion joints placed at
each structural (bridge) expansion joint or at least every 300 feet,
whichever is the shorter distance. For bridges under 100 feet, with no
bridge expansion joint, no conduit expansion joint is required. For
bridges greater than 100 feet, at least one conduit expansion joint
will be placed, even if there is no bridge expansion joint.
Page 2 of 4
17
6.0 Innerduct Installation.
Innerduct(s) shall be installed in all steel conduits. No cable will be
placed directly in any split/solid steel conduit without innerduct.
Innerduct(s) shall extend beyond the end of all conduits a minimum of
18 inches.
7.0 Cable Installation.
The fiber optic cable shall be installed using a powered pulling winch
and hydraulic-powered assist pulling wheels. The maximum pulling force
to be applied to the fiber optic cable shall be not exceed manufactures
recommendations.
All splices will be contained in a handhole or manhole.
8.0 Cable Markers (Warning Signs).
Cable markers shall be installed at sufficient frequency to ▇▇▇▇ the
location of the cable. Markers shall be positioned so that they can be
seen from the location of the cable and generally set facing
perpendicular to the cable running line.
9.0 Compliance.
All work will be done in strict accordance with federal, state, local
and applicable private rules and laws regarding safety and
environmental issues, including those set forth by OSHA and the EPA. In
addition, all work and the resulting fiber system will comply with the
current requirements of all governing entities (FCC, NEC, DEC, and
other national, state, and local codes).
10.0 As Built Drawings.
As-built drawings will contain a minimum of the following:
1) Information showing the location of running line, relative
to permanent landmarks, including but not limited to, railroad
mileposts, boundary crossings and utility crossings.
2) Splice locations
3) Manhole and handhole locations
4) Conduit information (type, length, expansion joints, etc.)
Page 3 of 4
18
5) Cable information (manufacturer, type of fiber, type of cable,
fiber assignments, and final cable lengths)
6) Notation of all deviations from specifications (depth, etc.)
7) ROW detail (type, centerline distances, boundaries, waterways,
and road crossings, known utilities and obstacles)
8) Cable marker locations and stationing
9) Regeneration locations. Construction of facilities will be
documented on the sitework/facility As-builts and maintained of
the file at the facility.
Drawings will be updated with actual field data during and after
construction.
As-builts will be provided within 90 days after acceptance, in both
hard copy and electronic format (Auto-CAD Release 13.0 or later).
Updates to the as-builts will be provided within 90 days of completion
of change, like a relocation project.
11.0 Deviations From Specifications.
Qwest may deviate from these specifications, when field conditions
dictate.
Page 4 of 4
19
EXHIBIT C
RIGHT OF WAY OCCUPANCY AGREEMENT
RIGHT OF WAY OCCUPANCY AGREEMENT
BETWEEN
CSX TRANSPORTATION, INC.
("GRANTOR")
AND
("GRANTEE")
Page 1 of 6
20
RIGHT-OF-WAY OCCUPANCY AGREEMENT
THIS RIGHT-OF-WAY OCCUPANCY AGREEMENT, made as of the __ day of
_______________ 19__ by and between CSX Transportation, Inc., a Virginia
corporation (hereinafter called "Railroad" or "Grantor"), whose mailing address
is ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, and ___________________
(hereinafter called "Grantee"), whose mailing address is ____________________,
WITNESSETH:
WHEREAS, Railroad owns, controls or operates certain lands, property
or, rights-of-way, with tracks, as part of a rail corridor for interstate
transportation and an operated line of railroad (hereinafter "Railroad
Corridor"); and,
WHEREAS, as of March 1, 1995, the Railroad and Qwest Communications
Corporation (formerly known as Southern Pacific Telecommunications Company,
"Qwest") entered into a Fiber Optic Placement Agreement under which the parties
agreed to Qwest's non-exclusive right to occupy a longitudinal portion or
segment of the Rail Corridor of Railroad, which is shown on the map attached
hereto and made a part hereof (such segment hereinafter designated "the
Right-of-Way) for the installation of a conduit (or Conduit System(s),
containing fiber optic cable, as part of a long distance communications system
(hereinafter "the Cable System"), in, on, under, along and over, as the case may
be, said Right-of-Way; and
WHEREAS, under the Fiber Optic Placement Agreement Railroad agreed to
execute Occupancy Agreements for conduits sold by Qwest to purchasers of conduit
from Qwest;
WHEREAS, Qwest and Grantee have entered into an Agreement for
Construction and Sale of Conduit under which Qwest has agreed to construct and
convey a Conduit in the Right of Way to Grantee; and
WHEREAS, Railroad and Grantee wish to formalize the effect of these
agreements and to record such use and occupancy rights in said Right-of-Way by
Grantee;
NOW, THEREFORE, for and in consideration of the premises hereinabove,
the payment of One Dollar ($1.00) and other valuable consideration, the receipt
of which is hereby acknowledged, Grantor, insofar as it has the right to do so,
and subject to and in accordance with the terms and conditions of the aforesaid
Fiber Optic Placement Agreement dated as of March 1, 1995 (as amended from time
to time), the terms of which are incorporated herein by reference, hereby grants
to Grantee, the nonexclusive right to enter onto the segment of Right-of-Way
indicated on the attached Exhibit "A", and to construct, place and occupy a
communications system consisting of a single one and one quarter inch (1-1/4")
conduit (collectively "Conduit System"), containing or to contain a fiber optic
cable and successor technologies (collectively "the Cable"), and the Permanent
Right to maintain, repair, reconstruct, replace, relocate, use and operate said
Conduit System (s) and Cable, all of which, including attendant equipment and
technological changes therein, shall be hereinafter referred to as "Facilities",
upon, over, in, on,
Page 2 of 6
21
along across or under, as the case may be, the Right-of-Way and tracks of
Railroad between ______________________________ all as indicated generally on
the Map attached hereto as Exhibit "A" and specifically incorporated herein by
reference.
TO HAVE AND TO HOLD this Right of Occupancy for a term of twenty-five
(25) years, extending and running to and through _____________ with rights of
Grantee to extend thereafter for two (2) successive terms of twenty-five (25)
years each, as provided hereinafter; for so long as Grantee or its assigns
continues to utilize and maintain the Facilities in or on said Right-of-Way
pursuant to the terms of said Fiber Optic Placement Agreement; PROVIDED,
however, that in accepting this Right of Occupancy, Grantee expressly recognizes
and agrees that (a) its right to utilize and occupy the Right-of-Way is
non-exclusive, (b) Grantor retains certain rights to license or otherwise
authorize other and additional occupancies of the Right-of-Way consistent with
Grantee's rights under this Agreement and the Fiber Optic Placement Agreement,
(c) the location of Grantee's Facilities within the Premises shall be subject to
the approval of Grantor in accordance with the Fiber Optic Placement Agreement,
and (d) Grantee shall not change the location of its Facilities, as shown on
approved As-built Drawings, without first notice to and approval of Grantor.
This Agreement is FURTHER SUBJECT TO all lawful outstanding existing
liens, mortgages and superior rights, in and to the Right-of-Way or Rail
Corridor, and to all leases, licenses, easement, occupations or other interests
previously granted to others therein.
Nothing herein shall be deemed to act as any warranty, guarantee, or
representation of the quality of Railroad title of the particular Right-of-Way
occupied, used or enjoyed by Grantee or any rights granted in this Agreement
and/or the Fiber Optic Placement Agreement.
For purposes of this Agreement only, the term "Right of Occupancy"
herein shall mean. (a) with regard to any segment of the Right-of-Way which is
owned by Grantor in fee simple absolute, an Easement; (b) with regard to any
portion of the Right-of-Way which is owned, occupied, used or controlled by
Grantor in less than fee simple absolute (fee simple determinable, fee simple
conditional or rail easement) merely a right to occupy and use, commensurate
with the term and extent of Grantor's interest, ownership, occupancy, use or
control; and (c) with regard to any portion of said Right-of-Way occupied, used
or controlled by Grantor under any other facts or rights, merely a right to
occupy and use so long as Grantor, its successors or assigns, continues
occupation, use or control of said Right-of-Way.
Railroad and Grantee each hereby confirm their intention and agreement
that the Facilities shall at all times be and remain personal property of
Grantee regardless of the manner or mode of installation thereof.
This Agreement may be renewed for two (2) additional terms of
twenty-five (25) years each, provided that Grantee gives Grantor written notice
of extension at least one (1) year prior to the expiration of this Agreement or
the first renewal term. The consideration for extension(s)
Page 3 of 6
22
hereof shall be the fair market value of such Right of Occupancy, as determined
by the parties as of the date of exercise of such extension, as follows:
(a) Grantee and Grantor shall attempt, in good faith within forty-five (45)
days after Grantor's receipt of Grantee's renewal notice, to reach an
agreement on the fair market value of the renewal rights with respect to
the Right-of-Occupancy. If Grantor and Grantee do not reach agreement on
the fair market value within the forty-five (45) day period, then at the
end of that forty-five (45) day period, Grantee may deposit cash in escrow
with a title insurance company (to be named) in an amount equally between
the proposed positions of Grantee and Grantor as to the fair market value
of such longitudinal renewal rights.
(b) After the forty-five (45) day period, Grantee and Grantor shall each
appoint an employee (who shall have at least five (5) years of full-time
experience in the valuation of utility easements) or employ/appoint an
appraiser, who shall be a member of the American Institute of Real Estate
Appraisers of that state (MAI) and who shall have at least five (5) years
of full-time commercial appraisal experience, to determine the fair market
value of the renewal rights with respect to such Right-of-Occupancy, and,
within fifteen (15) days after the expiration of such forty-five (45) day
period, shall notify the other party of the person so appointed. The two
appointees (whether employees or appraisers) shall meet promptly and
attempt to agree on such fair market value.
(c) In the event one party fails to give the other party notice within such
fifteen (15) day period, identifying a person so appointed, the person
designated by the non-failing party shall independently determine the fair
market value of the Right-of-Occupancy rights hereunder with respect to
such renewal period.
(d) If the two appointees are unable to agree within twenty (20) days after
the last of them has been appointed, they shall attempt to agree upon and
designate an outside appraiser (the "Appraiser"), not an employee of
either party, meeting the MAI and five (5) year experience qualifications
above, within ten (10) days after the expiration of the twenty (20) days
during which the two appointees were given to agree. If the appointees are
unable to agree on the Appraiser, either of the parties, after giving five
(5) days' notice to the other, may apply to (i) the presiding judge of the
Federal District Court of State or County(ies) where the Right-of-Way
Segment lies, or (ii) the American Arbitration Association, or (iii)
either of them, for the selection of the Appraiser meeting the MAI and
five (5) year qualifications stated above.
(e) The three appraisers (the Appraiser and the two appointees) shall each
make a determination of the fair market value of the rights with respect
to such Right-of-Occupancy. The determination that is farthest from the
middle determination shall be disregarded and the remaining two (2)
determinations shall be averaged in order to establish such value;
PROVIDED, however, if the low determination and/or the high determination
are equidistant from the middle determination, all three determinations
shall be averaged.
Page 4 of 6
23
(f) All determinations shall be rendered in writing and signed by the person
making the report within thirty (30) days from appointment.
(g) Such determination of the fair market value of the renewal rights with
respect to such longitudinal Right-of-Occupancy shall be conclusive and
shall be binding upon Grantee and Grantor without any right of appeal.
(h) Each party shall pay all fees and expenses charged or incurred by the
person appointed by such party; however, fees and expenses which cannot be
reasonably attributed to any one person, and the fees and expenses of the
Appraiser, shall be borne equally by Grantee and Grantor.
(i) If the escrow fund is to be used for payment, the fund shall then be
adjusted to the fair market value reached by the above process and the sum
paid to Grantor. Any excess funds from the escrow deposit and any interest
earned on the escrow deposit shall be paid to Grantee.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto, their respective successors or assigns.
All transfer, documentary or similar taxes on recordation, and all
recordation costs and responsibilities, shall be exclusive responsibility of
Grantee.
IN WITNESS WHEREOF, the parties hereto have caused their corporate names
and seals, and the hands of the officer(s) of each, duly authorized to execute
this Agreement, to be placed hereon as of the day and date first written above.
CSX TRANSPORTATION, INC.
WITNESS(ES):
By:
------------------------------- -----------------------------------
Print Name:
------------------------------- ---------------------------
Print Title:
--------------------------
Attest:
By:
------------------------------- -----------------------------------
Print Name:
------------------------------- ---------------------------
Print Title:
--------------------------
Page 5 of 6
24
ACKNOWLEDGMENTS
STATE OF FLORIDA )
) SS:
COUNTY OF ▇▇▇▇▇ )
Before me, a Notary Public, in and for said County, personally appeared
___________________, ( ) known personally to me or ( ) satisfactorily proven to
me by evidence (___________) to be the person who, as __________________of CSX
Transportation, Inc., the corporation which executed the foregoing instrument as
"Railroad" or Grantor, signed the same, and acknowledged to me that he did so
sign said instrument in the name and upon behalf of said corporation as such
office, that the same is his free act and deed as such officer, and the free and
corporate act and deed of said corporation, and within the authority delegated
to such officer by the Board of Directors of said corporation.
In testimony whereof, I have hereunto subscribed by name, and affixed
my official seal at _______________ this ____ day of___________________, 19___.
-----------------------------------
Notary Public
My Commission Expires: ____________
STATE OF _____________)
) ss:
COUNTY OF_____________)
Before me, a Notary Public, in and for said County, personally appeared
_______________________, (__) known personally to me or (__) satisfactorily
proven to me to be the person who, as _____________of _______________, the
corporation which executed the foregoing instrument as "Grantee", signed the
same, and acknowledged to me that he did so sign said instrument in the name and
upon behalf of said corporation as such office, that the same is his free act
and deed as such officer, and the free and corporate act and deed of said
corporation, and within the authority delegated to such officer by the Board of
Directors of said corporation.
In testimony whereof, I have hereunto subscribed by name, and affixed my
official seal at ________________, this ___ day of _________________ 19___.
-----------------------------------
Notary Public
My Commission Expires:_____________
Page 6 of 6
25
EXHIBIT E
▇▇▇▇ OF SALE
KNOW ALL MEN BY THESE PRESENTS that, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Qwest Communications Corporation, a Delaware corporation ("Qwest") does hereby
grant, bargain, sell, assign, transfer, convey and set over unto North American
DataCom Inc., (formerly ▇▇▇▇▇▇ International, Inc.), a Delaware corporation
("NADC") all right, title and interest in a one and one-quarter inch (1-1/4")
SDR 11 HDPE, including appurtenances, installed between New Orleans, Louisiana
and Mobile, Mississippi, and between Pensacola, Florida and Jacksonville,
Florida (the "NADC Conduit") as follows:
MP 802 New Orleans & MP 666 Mobile
MP 641.70 Pensacola & approx. MP 635.20 Jacksonville
Qwest hereby warrants to NADC that immediately prior to the delivery of
this ▇▇▇▇ of Sale, Qwest was the owner of the full legal and beneficial title to
the NADC Conduit and that Qwest had the good and lawful right to sell the same
and that good and marketable title to the NADC Conduit is hereby vested in NADC
free and clear of all liens, claims, encumbrances and right of others. Qwest
agrees to warrant and defend such title forever, at its expense, against the
claims of third parties (excepting therefrom persons or entities claiming rights
based on real property rights), including the manufacturers, vendors,
contractors and subcontractors from which Qwest acquired the NADC Conduit or
components thereof. The foregoing notwithstanding, Qwest makes no warranty, and
makes no covenant to defend title against those manufacturers and vendors of
materials supplied by NADC and installed in the NADC Conduit.
IN WITNESS WHEREOF, Qwest has caused this ▇▇▇▇ of Sale to be executed
and delivered in its name this 31st day of March, 2000 in Denver, Colorado.
QWEST COMMUNICATIONS CORPORATION
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
Date:
--------------------------------
Page 1 of 1
26
EXHIBIT G
QWEST's MAINTENANCE SPECIFICATIONS AND PROCEDURES
Any party responsible for providing maintenance of the Qwest System hereunder
shall be referred to herein as the "Service Provider". The party receiving
maintenance services from the Service Provider hereunder shall be referred to
herein as the "Service Recipient". All other capitalized terms not otherwise
defined herein shall have their respective meanings as set forth in the
Agreement of which this Exhibit forms a part.
1. MAINTENANCE--CONDUIT ONLY
(a) Scheduled Maintenance. Routine maintenance and repair of the Qwest
System described in this Section shall be performed by or under the
direction of Service Provider, at Service Provider's reasonable
discretion or at Service Recipient's request. Scheduled Maintenance
shall commence upon the Acceptance Date of the Agreement. Scheduled
Maintenance shall include the following activities:
(i) Patrol of Qwest System route on a regularly scheduled basis,
which will be weekly unless hyrail access is necessary, in
which case, it will be quarterly;
(ii) Maintenance of a "Call-Before-You-Dig" program and all
required and related cable locates;
(iii) Maintenance of sign posts along the Qwest System right-of-way
with the number of the local "Call-Before-You-Dig"
organization; and
(iv) Assignment of fiber maintenance employees to locations along
the Qwest System at intervals dependent upon terrain,
accessibility, locate ticket volume, etc. Service Provider
shall decide the staffing of maintenance employees for the
Qwest System.
(v) Service Provider shall have qualified representatives on site
any time Service Provider has reasonable advance knowledge
that another person or entity is engaging in construction
activities or otherwise excavating within five (5) feet of the
Qwest System.
(b) Unscheduled Maintenance. Non-routine maintenance and repair of the
Qwest System, which is not included as Scheduled Maintenance, shall
be performed by or under the direction of Service Provider.
Unscheduled Maintenance shall commence upon the Acceptance Date of
the Agreement. Unscheduled Maintenance shall consist of:
Page 1 of 5
27
(i) "Emergency Unscheduled Maintenance" in response to an alarm
identification by Service Provider's Operations Center,
notification by Service Recipient or notification by any third
party of any failure, interruption or impairment in the
operation of the Qwest System, or any event imminently likely
to cause the failure, interruption or impairment in the
operation of the Qwest System.
(ii) "Non-Emergency Unscheduled Maintenance" in response to any
potential service-affecting situation to prevent any failure,
interruption or impairment in the operation of the Qwest
System.
Service Recipient shall immediately report the need for Unscheduled
Maintenance to Service Provider in accordance with procedures
promulgated by Service Provider from time to time. Service Provider
will log the time of Service Recipient's report, verify the problem
and dispatch personnel immediately to take corrective action.
2. OPERATIONS CENTER
Service Provider shall operate and maintain an Operations Center ("OC")
twenty-four (24) hours a day, seven (7) days a week. Service Provider's
maintenance employees shall be available for dispatch twenty-four (24)
hours a day, seven (7) days a week. Service Provider shall have its first
maintenance employee at the site requiring Emergency Unscheduled
Maintenance activity within two (2) hours after the time Service Provider
becomes aware of an event requiring Emergency Unscheduled Maintenance,
unless delayed by circumstances beyond the reasonable control of Service
Provider. Service Provider shall maintain a toll-free telephone number to
contact personnel at the OC. Service Provider's OC personnel shall
dispatch maintenance and repair personnel to handle and repair problems
detected in the Qwest System.
3. COOPERATION AND COORDINATION
(a) Service Recipient shall utilize an Escalation List, as updated from
time to time, to report and seek immediate action on exceptions
noted in the performance of Service Provider in meeting maintenance
service objectives.
(b) Service Recipient will, as necessary, arrange for unescorted access
for Service Provider to all sites of the Qwest System, subject to
applicable contractual, underlying real property and other
third-party limitations and restrictions.
(c) In performing its services hereunder, Service Provider shall take
workmanlike care to prevent impairment to the signal continuity and
performance of the Qwest System. The precautions to be taken by
Service Provider shall include notifications to Service Recipient.
In addition, Service Provider shall reasonably cooperate with
Page 2 of 5
28
Service Recipient in sharing information and analyzing the
disturbances regarding the cable and/or fibers. In the event that
any Scheduled or Unscheduled Maintenance hereunder requires a
traffic roll or reconfiguration involving cable, fiber, electronic
equipment, or regeneration or other facilities of the Service
Recipient, then Service Recipient shall, at Service Provider's
reasonable request, make such personnel of Service Recipient
available as may be necessary in order to accomplish such
maintenance, which personnel shall coordinate and cooperate with
Service Provider in performing such maintenance as required of
Service Provider hereunder.
(d) Service Provider shall notify Service Recipient at least three (3)
business days prior to the date in connection with any Maintenance
Window (MW) of any Scheduled Maintenance and as soon as possible
after becoming aware of the need for Unscheduled Maintenance.
Service Recipient shall have the right to be present during the
performance of any Scheduled Maintenance or Unscheduled Maintenance
so long as this requirement does not interfere with Service
Provider's ability to perform its obligations under this Agreement.
In the event that Scheduled Maintenance is canceled or delayed for
whatever reason as previously notified, Service Provider shall
notify Service Recipient at Service Provider's earliest opportunity,
and will comply with the provisions of this Section.
4. FACILITIES
(a) Service Provider shall maintain the Qwest System in a manner, which
will permit Service Recipient's use of the Qwest System in
accordance with the terms and conditions of the Agreement. All
common systems within facilities along the Qwest System shall be
maintained in accordance with manufacturer's specifications, to
include battery plants, generators, and HVAC units.
(b) Except to the extent otherwise expressly provided in the Agreement,
Service Recipient will be solely responsible for providing and
paying for any and all maintenance of all electronic, optronic and
other equipment, materials and facilities used by Service Recipient
in connection with the operation of their dark fibers, none of which
is included in the maintenance services to be provided hereunder.
5. MAINTENANCE FEES AND COSTS---CONDUIT ONLY
A) Scheduled Maintenance Fees. The fees payable for any and all
Scheduled Maintenance hereunder shall be determined in accordance
with the following provisions. Service Provider shall provide
Scheduled Maintenance on the Qwest System for a period not to exceed
twelve (12) months following the Effective Date of the Agreement as
provided in Section 9 of the Agreement (the "Maintenance Term"). The
fee for such Scheduled Maintenance shall be $25,000 (the "Scheduled
Maintenance Fee"). If Service Recipient elects to extend the term of
Page 3 of 5
29
Scheduled Maintenance for an additional period of twelve (12) months
pursuant to the terms and conditions set forth in Section 9 of the
Agreement (the "Extended Maintenance Term"), Service Recipient shall
pay Service Provider an additional fee of $25,000.
B) Unscheduled Maintenance Fees. For any other Unscheduled Maintenance
performed by Service Provider during the Maintenance Term or
Extended Maintenance Term, as the case may be, the Costs thereof
shall be allocated among the various interest holders in the
conduit, Cable and/or fibers affected thereby as follows: (i) Costs
of Unscheduled Maintenance solely to or affecting a conduit or Cable
which houses fibers of a single interest holder shall be borne 100%
by such interest holder; (ii) Costs of Unscheduled Maintenance to or
affecting a conduit which houses multiple innerduct conduits, not
including such Costs attributable to the repair or replacement of
fiber therein, shall be borne proportionately by the interest
holders in each of the affected innerduct conduits based on the
ratio that such affected conduit bears to the total number of
affected innerduct conduits, and (iii) Costs of Unscheduled
Maintenance attributable to the repair or replacement of fiber,
including the acquisition, installation, inspection, testing and
splicing thereof, shall be borne proportionately by the interest
holders in the affected fiber, based on the ratio that the number of
affected fibers subject to the interest of each such interest holder
bears to the total number of affected fibers. All such Costs, which
are allocated to Service Recipient pursuant to the foregoing
provisions, shall be the responsibility of and paid by Service
Recipient within thirty (30) days after its receipt from Service
Provider of an invoice therefor.
C) Costs. "Costs" means the actual, direct costs paid or payable in
accordance with the established accounting procedures generally used
by each party, as the case may be, and which its utilizes in billing
third parties for reimbursable projects, which costs shall include,
without limitation, the following: (i) labor costs, including wages
and salaries, benefits and overhead allocable to such labor costs
(overhead allocation percentage shall not exceed the lesser of (x)
the percentage Service Provider typically allocates to its internal
projects or (y) thirty-percent (30%), and (ii) other direct costs
and out-of-pocket expenses on a pass-through basis (e.g., equipment,
material, supplies, contract services, etc.).
6. MAINTENANCE WINDOW (MW)
Scheduled Maintenance, which is reasonably expected to produce any signal
discontinuity, must be coordinated between the parties. Generally, this
work should be scheduled after 11:00 p.m. and before 7:00 a.m. local time.
Major system work, such as fiber rolls and hot cuts, will be scheduled for
MW weekends and shall allow work during daylight hours if on a Saturday or
Sunday. Service Provider and Service Recipient will agree upon a MW
calendar. The intent is to avoid jeopardy work on high-traffic holidays.
Page 4 of 5
30
7. SUBCONTRACTING
Service Provider may subcontract any of the maintenance services
hereunder; provided that Service Provider shall require the
subcontractor(s) to perform in accordance with the requirements and
procedures set forth herein. The use of any such subcontractor shall not
relieve Service Provider of any of its obligations hereunder.
Page 5 of 5
31
EXHIBIT I
GUARANTY AGREEMENT
This Guaranty Agreement (this "Guaranty") is made effective as of March
31, 2000 by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, (the "Guarantor"). This Guaranty is being given
to Qwest Communications Corporation (the "Creditor") for the benefit of the
Creditor and for North American DataCom, Inc., (the "Debtor").
I. OBLIGATIONS. This Guaranty is given by the Guarantor to induce the
Creditor to enter into a Contract labeled "Agreement For Sale of Conduit" (the
"Contract") pursuant to which Creditor has agreed to sell fiber optic conduit to
Debtor. In consideration therefor, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Guarantor guarantees prompt and satisfactory performance of the Contract, in
accordance with all of its terms and conditions, by the Debtor, according to the
Contract's terms and conditions. The Guarantor shall be liable to the Creditor
for all expenses, costs, and damages that the Creditor is entitled to recover
from the Debtor, including, to the extent not prohibited by law, all costs and
attorney's fees incurred in attempting to realize upon this Guaranty, as
provided herein.
II. DURATION. This is a continuing Guaranty and shall not be revoked
by the Guarantor. This Guaranty will remain effective until all obligations
guaranteed by this Guaranty are completely discharged.
III. NOTICE OF DEFAULT. The Creditor shall notify the Guarantor of a
default by the Debtor in the Debtor's commitments to the Creditor before
proceeding against the Guarantor under this Guaranty.
IV. CREDITOR PROVISIONS. The Creditor must exercise reasonable
diligence to recover monies due or performance owed by the Debtor before seeking
to enforce this Guaranty and collect against the Guarantor. If the Guarantor is
required to perform in the place of the Debtor, the Guarantor will assume the
place of the Creditor in any legal action against the Debtor. This Guaranty is
given with the understanding that all Creditor's remedies shall be exhausted
before any claim is asserted against the Guarantor for collection of any debt or
the performance of the Contract by the Guarantor.
V. ENTIRE AGREEMENT. This Guaranty contains the entire agreement of the
parties with respect to the subject matter of this Guaranty and there are no
other promises or conditions in any other agreement, whether oral or written.
This Guaranty supersedes any prior written or oral agreements between the
parties with respect to the subject matter of this Guaranty.
VI. AMENDMENT. This Guaranty may be modified or amended, if the
amendment is made in writing and is signed by both parties.
Page 1 of 2
32
VII. SEVERABILITY. If any provision of this Guaranty shall be held to
be invalid or unenforceable for any reason, the remaining provisions shall
continue to be valid and enforceable. If a court finds that any provision of
this Guaranty is invalid or unenforceable, but that by limiting such provision
it would become valid or enforceable, then such provision shall be deemed to be
written, construed, and enforced as so limited.
VIII. WAIVER OF CONTRACTUAL RIGHT. The failure of either party to
enforce any provision of this Guaranty shall not be construed as a waiver or
limitation of that party's right to subsequently enforce and compel strict
compliance with every provision of this Guaranty.
IX. APPLICABLE LAW. This Guaranty Shall be governed by the laws of the
State of Mississippi.
X. NON-CIRCUMVENTION. Guarantor shall not seek to circumvent or
frustrate the guaranty provided herein by disposing of his assets other than in
the normal and ordinary course of business, including but not limited to gifts,
bequests and such "non-consideration" transfers of assets to any entity.
Guarantor:
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Page 2 of 2