Exhibit 10.5
CONFIDENTIAL AND PROPRIETARY EXECUTION FORM
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IRU AGREEMENT
DATED AS OF OCTOBER 18, 1996
BY AND BETWEEN
QWEST COMMUNICATIONS CORPORATION ("QWEST")
AND
FRONTIER COMMUNICATIONS INTERNATIONAL INC. ("FRONTIER")
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TABLE OF CONTENTS
Page
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RECITALS........................................................ 1
ARTICLE ▇. ▇▇▇▇▇ OF IRU IN QWEST SYSTEM........................ 1
ARTICLE II. CONSIDERATION FOR GRANT............................ 7
ARTICLE III. CONSTRUCTION OF THE QWEST SYSTEM.................. 11
ARTICLE IV. ACCEPTANCE AND TESTING OF FRONTIER FIBERS.......... 13
ARTICLE V. DOCUMENTATION....................................... 14
ARTICLE VI. TERM............................................... 14
ARTICLE VII. NETWORK ACCESS; REGENERATION FACILITIES........... 16
ARTICLE VIII. OPERATIONS....................................... 19
ARTICLE IX. MAINTENANCE AND REPAIR OF THE QWEST SYSTEM......... 20
ARTICLE X. PERMITS; UNDERLYING RIGHTS; RELOCATION.............. 20
ARTICLE XI. USE OF QWEST SYSTEM................................ 23
ARTICLE XII. INDEMNIFICATION................................... 26
ARTICLE XIII. LIMITATION OF LIABILITY.......................... 28
ARTICLE XIV. INSURANCE......................................... 28
ARTICLE XV. TAXES, FEES AND OTHER GOVERNMENTAL IMPOSITIONS..... 30
ARTICLE XVI. NOTICE............................................ 34
ARTICLE XVII. CONFIDENTIALITY.................................. 36
ARTICLE XVIII. DEFAULT......................................... 37
ARTICLE XIX. TERMINATION....................................... 42
ARTICLE XX. FORCE MAJEURE...................................... 42
ARTICLE XXI. DISPUTE RESOLUTION................................ 43
ARTICLE XXII. WAIVER........................................... 45
ARTICLE XXIII. GOVERNING LAW................................... 45
ARTICLE XXIV. RULES OF CONSTRUCTION............................ 46
ARTICLE XXV. ASSIGNMENT AND DARK FIBER TRANSFERS............... 46
ARTICLE XXVI. REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENTS.. 50
ARTICLE XXVII. ENTIRE AGREEMENT; AMENDMENT..................... 52
ARTICLE XXVIII. NO PERSONAL LIABILITY.......................... 52
ARTICLE XXIX. RELATIONSHIP OF THE PARTIES...................... 53
ARTICLE XXX. LATE PAYMENTS..................................... 53
ARTICLE XXXI. SEVERABILITY..................................... 53
ARTICLE XXXII. COUNTERPARTS.................................... 53
ARTICLE XXXIII. CERTAIN DEFINITIONS............................ 54
EXHIBITS
Exhibit A: QWEST System Description
Exhibit A-1: QWEST System Description and Delivery Dates
Exhibit A-2: General Route Map
Exhibit A-3: Basic and Optional Detailed Route Maps
Exhibit A-4: Designated Endpoint and Intermediate Point Cities
Exhibit B: IRU Fee Payment Schedule
Exhibit C: Construction Specifications
Exhibit D: Fiber Cable Splicing, Testing, and Acceptance Procedures
Exhibit E: Fiber Specifications
Exhibit E-1: Fiber Deployment Diagram
Exhibit F: Specifications for Regeneration Facilities
Exhibit G: Regeneration Facility Sites
Exhibit G-1: Temporary Space within Certain QWEST Facilities
Exhibit H: QWEST System Maintenance Specifications and Procedures
Exhibit I: Form of Surety Bond
Exhibit J: Underlying Rights and Underlying Rights Requirements
Exhibit K: Form of Frontier Corporation Guaranty
Exhibit L: Form of Anschutz Guaranty
IRU AGREEMENT
THIS IRU AGREEMENT (this "Agreement") is made and entered into as of
October 18, 1996, by and between QWEST COMMUNICATIONS CORPORATION, a Delaware
corporation ("QWEST"), and FRONTIER COMMUNICATIONS INTERNATIONAL INC. a Delaware
corporation ("FRONTIER").
RECITALS
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A. QWEST is planning to construct a continuous fiberoptic communication
system, contiguous from end to end, as described in Exhibit A hereto as the
"Basic Route," and between each of the city pairs identified in Exhibit A-1
hereto under the caption "Basic Route" (the fiberoptic communication system
between each such city pair being referred to as a "Basic Segment"), and may
elect to construct a continuation of such fiberoptic communication system along
the routes described in Exhibit A hereto as the "Option 1 Route," "Option 1A
Route" and the "Option 2 Route" (collectively, the "Optional Routes"), and
between each of the city pairs identified in Exhibit A-1 hereto under the
captions "Option 1 Route," "Option 1A Route" and "Option 2 Route" (the
fiberoptic communication system between each such city pair being referred to as
an "Optional Segment") (the Basic Segments, together with such of the Optional
Segments, if any, that QWEST elects to construct hereunder, being referred to
herein collectively as the "QWEST System").
B. FRONTIER desires to be granted the right to use (or, if and to the
extent provided in Section 1.5 hereof, to own) certain optical fibers in the
QWEST System.
C. QWEST desires to grant FRONTIER an exclusive, indefeasible right to use
(or, if and to the extent provided in Section 1.5 hereof, to convey title to)
certain fibers and associated property in the QWEST System, all upon the terms
and conditions set forth below.
Accordingly, in consideration of the mutual promises set forth below, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:
ARTICLE ▇.
▇▇▇▇▇ OF IRU IN QWEST SYSTEM
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1.1 (a) Effective as of the effective date described in Section 6.1
below, for each particular Segment (as defined below in this Section 1.1)
delivered by QWEST to FRONTIER hereunder and with respect to which an Acceptance
Date (as defined in Section 4.2 below) has occurred, QWEST hereby grants to
FRONTIER, and FRONTIER hereby purchases from QWEST, (i) an exclusive,
Indefeasible Right of Use (as defined in Section 33.1(f)) (or, if and to the
extent provided in Section 1.5 hereof, ownership) in, for the purposes described
herein, twenty-four (24) (or, if and to the extent that FRONTIER timely
exercises the options described in Section below, forty-eight (48))
"Dark Fibers" (as defined in Section 33.1(c)) to be
specifically identified, in the QWEST System (A) in the Basic Segments and along
the Basic Route more specifically described in the maps included in Exhibit A-3
hereto; and (B) if, pursuant to Section 1.3, QWEST elects, in its discretion, to
construct either of Option Route 1 or Option Route 1A, and/or Option Route 2, or
FRONTIER elects, in its discretion, to require QWEST to construct Option Route
1, in any case as identified in Exhibit A (and along the Option 1, Option 1A and
Option 2 Routes more specifically described in the maps included in Exhibit A-3
hereto), in the Optional Segments included in any such Optional Routes so
elected to be constructed, and (ii) an associated and non-exclusive Indefeasible
Right of Use, for the purposes described herein, in the tangible and intangible
property needed for the use of such Dark Fibers as Dark Fibers, including, but
not limited to, the associated conduit, QWEST's rights in all "Underlying
Rights" (as defined in Section 10.1) and, to the extent provided in Article VII
herein, associated Regeneration Facilities (as defined in Section 7.2), but in
any event excluding any electronic or optronic equipment (collectively, the
"Associated Property"), for the Term (as defined in Section 6.1) respecting such
Basic Segment or Optional Segment, and all on the terms and subject to the
covenants and conditions set forth herein (collectively, the "IRUs"). The Dark
Fibers subject to the IRUs are referred to collectively as the "FRONTIER
Fibers." The Basic Segments, together with such of the Optional Segments, if
any, that QWEST elects or is required to construct pursuant to Section 1.3 are
referred to herein collectively as the "Segments." The Basic Route, together
with such of the Optional Routes, if any, that QWEST elects or is required to
construct pursuant to Section 1.3 are referred to herein collectively as the
"System Route."
(b) The parties acknowledge and agree that the specific route of any
Segment that has not been finally designed or engineered, or with respect to
which a right-of-way agreement has not been obtained as of the date hereof is
subject to final determination by QWEST, based on specific engineering, right-
of-way, permitting, authorization and other requirements; provided, however,
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that (i) any such Segment route, as finally determined, must include all of
the endpoint and intermediate point cities identified in Exhibit A-4 and all
of the junction points identified in the System Route maps included in
Exhibit A; (ii) no deviation in the route of any Segment as set forth in the
maps included in Exhibit A-3 shall result in a Material Deviation (as defined
below) in the System Route as set forth in Exhibit A, and (iii) once the final
route of any Segment has been so determined, QWEST shall deliver to FRONTIER
corresponding revisions to the relevant maps included in Exhibit A hereto.
As used herein, the term "Material Deviation" shall mean a deviation in the
general route of a Segment (A) that modifies the System Route architecture in
a manner that breaks a ring, creates a spur or breaks the contiguous nature of
Segments; (B) that modifies the route of the System Route through any city,
identified in Exhibit A-3 as being the location of a FRONTIER POP site, from
the detailed route map shown in Exhibit A-3 for such city in a manner that
materially changes the proximity of such POP site to the System Route right-of-
way (provided that, if any such detailed city map shows that the POP site is
in direct proximity to the System Route right-of-way, any route modification
which does not provide such direct proximity shall be considered a material
change in proximity);
(C) that modifies the route of the System Route through any city, as set forth
in the detailed route map for such city set forth in Exhibit A-3, such that the
location of the route at any point would be moved more than 1,200 feet in any
direction, without the prior written approval of FRONTIER (such approval not to
be unreasonably withheld or delayed); or (D) that modifies any parallel route
shown within any city that is the subject of a detailed map included in Exhibit
A-3 such that the distance between such parallel routes is less than 1,200 feet
outside metropolitan areas and less than two city blocks within metropolitan
areas.
(c) If any deviation(s) in the routes of Segments (i) comprising the Basic
Route and Option Route 1 cause(s) the aggregate route miles as reflected in
Exhibit A estimated for the Basic Route and Option Route 1 taken together to
increase by more than
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%) of such aggregate estimate or (ii)
comprising Option Route 1A and/or Option Route 2 cause(s) the route miles as
reflected in Exhibit A estimated for Option 1A and/or Option Route 2 taken
separately to increase by more than
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%) of such estimate, then in
each case under the foregoing clause (i) and clause (ii) such mileage shall be
solely at QWEST's cost and expense and any route mileage in excess of the
applicable
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%) increase as aforesaid shall not be included in the
route mileage for purposes of determining or redetermining the IRU Fee as
defined and described in Section 2.1 below.
1.2 With respect to Segments 12A, 12B, 12C, 12D and 16, the parties
acknowledge that (i) QWEST has represented that the conduit and Cable comprising
such Segments have been constructed and installed as of the date hereof, and
that only the regeneration and other technical facilities required to be
provided with respect to each such Segment pursuant to Article VII remains to be
constructed and installed, (ii) FRONTIER desires to use the FRONTIER Fibers in
the Cable comprising each such Segment pending delivery of such facilities, and
(iii) the Cable comprising such Segments currently is routed through such
facilities of QWEST. Accordingly, with respect to Segments 12A, 12B, 12C, 12D
and 16, the parties agree that notwithstanding any provisions of this Agreement
to the contrary:
(a) Promptly following execution of this Agreement, the Fiber Acceptance
Testing procedures set forth in Article IV shall take place with respect to each
such Segment, as the FRONTIER Fibers currently are routed through the QWEST
facilities and, upon satisfactory completion thereof with respect to each such
Segment in accordance with Article IV, the Acceptance Date with respect to such
Segment shall occur. Upon such Acceptance Date, payment of an additional
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% of
the IRU Fee with respect to such Segment shall be due and payable by FRONTIER.
(b) Upon receipt of such payment, the IRUs with respect to the relevant
Segment, other than the IRU in the Associated Property required to be delivered
pursuant to Section 7.2, shall become effective. Thereupon, FRONTIER may
temporarily install in the space within certain QWEST facilities described in
Exhibit G-1 hereto, such electronic, optronic and other
equipment as shall be necessary to operate the FRONTIER Fibers in such Segment;
provided that such installation is done consistent with QWEST's co-location
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policies and procedures substantially as set forth in the form of co-location
agreement, a copy of which has been provided to and accepted by FRONTIER.
(c) The Associated Property required to be delivered pursuant to Section
7.2 shall be delivered in accordance with the requirements of Section 3.2 with
respect to each such Segment. The parties agree to cause their respective
appropriate technical personnel to discuss and agree, in good faith, upon the
procedures by which, upon such delivery, (i) the FRONTIER Fibers comprising such
Segments shall be rerouted, at QWEST's cost and expense, in the Regeneration
Facilities (or POPs or terminal facilities) required to be provided pursuant to
Article VII, and (ii) tested, at QWEST's cost and expense, to confirm that, as
rerouted, the FRONTIER Fibers continue to operate in conformity with the Fiber
Acceptance Testing specifications set forth in Exhibit D and the procedures set
forth in Article IV.
(d) Upon the delivery of such Associated Property, the rerouting of the
FRONTIER Fibers therein, and the confirmed testing described in Section
1.3(c)(ii), the remaining
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CONFIDENTIAL TREATMENT##
%) of the IRU Fee with respect to each
such Segment shall be due and payable by FRONTIER. Upon receipt of such
payment, the IRU with respect to such Associated Property for such Segment shall
become effective.
1.3 (a) Until 5:00 p.m. Eastern Standard (or Daylight, as applicable)
Time on the date that is one hundred eighty (180) days after the date hereof
(the "Option Period") (i) QWEST shall have the right to elect to construct and
(ii) FRONTIER shall have the right to elect to require QWEST to construct,
Option Route 1.
Either party desiring to exercise such right shall notify the other in writing
by such time and date whether or not it will construct or require the
construction of Option Route 1. Failure of QWEST to notify FRONTIER of QWEST's
election as to Option Route 1 as provided herein shall be deemed an election by
QWEST not to undertake to construct Option Route 1, and failure of FRONTIER to
notify QWEST of FRONTIER's election as to Option Route 1 as provided herein
shall be deemed an election by FRONTIER not to require that QWEST construct
Option Route 1. If neither QWEST nor FRONTIER timely exercises its right to
construct or require the construction of Option Route 1 as provided herein,
then, until 5:00 p.m. Eastern Standard (or Daylight, as applicable) Time on the
day that is five (5) days following the last day of the Option Period, QWEST
shall have the right to elect to construct Option ▇▇▇▇▇ ▇▇. ▇▇▇▇▇ shall notify
FRONTIER in writing by such time and date whether or not it will construct
Option Route 1A. Failure of QWEST to notify FRONTIER of QWEST's election as to
Option Route 1A as provided herein shall be deemed an election by QWEST not to
construct Option Route 1A.
(b) QWEST shall have until 5:00 p.m. Eastern Standard (or Daylight, as
applicable) Time on the last day of the Option Period to elect whether or not it
will construct Option Route 2 as provided herein. QWEST shall notify FRONTIER
in writing by such time and date whether
or not it will construct Option Route 2 as provided herein. Failure of QWEST to
timely notify FRONTIER of QWEST's election as to Option Route 2 as provided
herein shall be deemed an election by QWEST not to undertake to construct Option
Route 2 as provided herein.
(c) The election or deemed election by QWEST not to construct any of the
Optional Routes as provided herein shall not affect its obligations or rights
with respect to the other Optional Routes or any of the Basic Segments and, from
and after any such election or deemed election, neither party shall have any
further rights or obligations with respect to such Optional Route hereunder.
(d) From the date hereof until the expiration of the parties' rights under
this Section 1.3, FRONTIER shall not enter into any agreement (oral or written)
or initiate discussions or negotiations with any third party with respect to its
acquisition of an alternative Dark Fiber system along the same or similar routes
as any of the Optional Routes, and FRONTIER shall not engage in discussions with
any third party who may initiate the same without prior notice to QWEST of the
identity of such third party given promptly after such initiation by such third
party and prior to FRONTIER's engaging in such discussions with such third
party, and if FRONTIER engages in such discussions as aforesaid then FRONTIER
shall keep QWEST informed generally of the material proposed terms and material
changes to such terms with respect to such discussions relating to an
acquisition by such third party of an alternative Dark Fiber system along the
same or similar routes as any of the Optional Routes. If QWEST timely exercises
its option hereunder to construct any of the Optional Routes or if FRONTIER
timely exercises its right to require the construction of Option Route 1, in any
such case as provided herein, then FRONTIER and QWEST shall be obligated to
observe and perform their respective obligations hereunder with respect to such
Optional Route, all on the terms and subject to the conditions set forth herein.
1.4 (a) FRONTIER shall have an option (the "System Fiber
Option"), exercisable until 5:00 p.m. Eastern Standard (or Daylight,
as applicable) Time on the date that is one hundred eighty-six (186)
days after the date hereof (the "System Option Exercise Date"), to
elect to increase the number of Dark Fibers subject to the IRU in the
entire QWEST System to be delivered hereunder (including the Optional
Segments, if and to the extent QWEST elects to construct the Optional
Routes or is required to construct Option Route 1 pursuant to
Section 1.3 hereof) from twenty-four (24) to forty-eighty (48) Dark
Fibers (such additional twenty-four (24) Dark Fibers being referred to
as the "Optional System Dark Fibers"), by delivering written notice of
such election to QWEST by such time and date. If FRONTIER timely
exercises the System Fiber Option, the IRU Fee with respect to all
Segments shall be redetermined as described in Section 2.1(b) below.
(ii) If, prior to the System Option Exercise Date, QWEST
enters into an agreement with the party (or the successor in interest
of such party or a subsidiary of such party) with whom QWEST and
FRONTIER previously have engaged in extensive discussions concerning
the provision by QWEST of a forty-eight (48) Dark Fiber system along
the QWEST System (the "Third Party"), pursuant to which QWEST grants
to the Third Party an IRU in twenty-four (24) Dark Fibers along some
or all of the QWEST System, QWEST shall promptly notify FRONTIER
thereof. In such event, FRONTIER may, at its election and at its sole
discretion, at any time on or before the Option Exercise Date (A) if
the Third Party acquires Dark Fibers along the entire QWEST System,
elect to cancel the System Fiber Option in its entirety, in
consideration for which the IRU Fee for all Segments shall be
redetermined as described in Section 2.1(c) below, (B) if the Third
Party acquires Dark Fibers in Segments comprising less than all of the
QWEST System, elect to exercise the System Fiber Option only with
respect to the Segments not so acquired by the Third Party and to
cancel the System Fiber Option with respect to the Segments acquired
by the Third Party, in consideration for which the IRU Fee with
respect to all Segments shall be redetermined as described in
Section 2.1(d) below, or (C) in any event, elect to exercise the
System Fiber Option in its entirety pursuant to Section 1.4(a)(i),
unaffected by QWEST's transaction with the Third Party.
(iii) Failure of FRONTIER to timely notify QWEST of
FRONTIER's election to exercise the System Fiber Option in whole or,
as permitted, in part, as provided herein, shall be deemed an election
by FRONTIER not to exercise the System Fiber Option. The election or
deemed election of FRONTIER not to exercise the System Fiber Option
shall not affect either party's rights or obligations with respect to
the twenty-four (24) Dark Fiber QWEST System to be provided hereunder
and, from and after any such election or deemed election, neither
party shall have any further rights or obligations with respect to the
Optional System Dark Fibers hereunder.
(b) FRONTIER shall have an option (the "Sacramento/Seattle Fiber
Option"), exercisable until 5:00 p.m. Eastern Standard (or Daylight,
as applicable) Time on the date that is thirty (30) days after the
date hereof, to elect to increase the number of Dark Fibers subject to
the IRU in the Segments between the cities of Sacramento, California
and Seattle, Washington identified in Exhibit A (the
"Sacramento/Seattle Segments") from twenty-four (24) to forty-eight
(48) Dark Fibers (such additional twenty-four (24) Dark Fibers being
referred to as the "Optional Sacramento/Seattle Dark Fibers"), by
delivering written notice of such election to QWEST by such time and
date. If FRONTIER timely exercises the Sacramento/Seattle Fiber
Option, the IRU Fee with respect to the Sacramento/Seattle Segments
shall be redetermined as described in Section 2.1(e) below.
Notwithstanding the foregoing, FRONTIER acknowledges that the
Sacramento/Seattle Fiber Option is not to be redundant of the System
Fiber Option and, accordingly, (i) the Sacramento/Seattle Fiber Option
automatically shall be canceled if FRONTIER exercises the System Fiber
Option or cancels the System Fiber Option pursuant to Section
1.4(a)(ii), and (ii) the maximum number of Dark Fibers deliverable by
QWEST to FRONTIER with respect to either or both of the
Sacramento/Seattle Fiber Option and the System Fiber Option shall not
exceed forty-eight (48) Dark Fibers along the applicable route.
Failure of FRONTIER to timely notify QWEST of FRONTIER's election to
exercise the Sacramento/Seattle Fiber Option as provided herein shall
be deemed an election by FRONTIER not to exercise the
Sacramento/Seattle Fiber Option. The election or deemed election of
FRONTIER not to exercise the Sacramento/Seattle Fiber Option shall not
affect either party's rights or obligations with respect to the
twenty-four (24) Dark Fibers in the Sacramento/Seattle Segments to be
provided hereunder and, from and after any such election or deemed
election, neither party shall have any further rights or obligations
with respect to the Optional Sacramento/Seattle Dark Fibers hereunder.
1.5 Notwithstanding anything contained herein to the contrary: (a) if and
to the extent allowed by the Underlying Right(s) for a particular Segment, and
(b) if the Underlying Right(s) with respect to such Segment do not and will not
impose upon QWEST any additional fees, costs or charges as a result thereof
(unless FRONTIER shall pay the same or make arrangements satisfactory to QWEST
to assure such payment), QWEST shall, upon the request of FRONTIER and on a
Segment-by-Segment basis on or before the Acceptance Date with respect to such
Segment: (i) grant a non-exclusive sub-easement, sub-right of way, or sub-
underlying right (collectively a "Sub-Easement") to FRONTIER providing rights
(but, subject to the foregoing clause (b) of this Section 1.5 above, at no
additional cost to or monetary obligations of FRONTIER) to FRONTIER similar to
the rights held by QWEST under the relevant Underlying Right(s), and (ii)
transfer title to the Frontier Fibers to FRONTIER free and clear of all liens as
provided in Section 11.4 hereof, and (iii) continue the grant of the IRU in the
Associated Property. Nothing in this Section 1.5 shall relieve QWEST or
FRONTIER of its (nor, except and only to the extent of the change in the nature
of the property interest of FRONTIER in the FRONTIER Fibers or a Sub-Easement,
or the case may be, diminish, enlarge or otherwise affect its) rights, duties
and obligations set forth in this Agreement and if any Sub-Easement shall
terminate or FRONTIER shall be otherwise prohibited from owning title to the
Frontier Fibers, QWEST shall retain, maintain or replace the relevant Underlying
Right in accordance with and pursuant to Article X, title to such Frontier
Fibers shall revert and be reconveyed to QWEST and FRONTIER shall have and
retain the IRU in such Frontier Fibers under and subject to the terms and
conditions of this Agreement. If a Sub-Easement is granted or title to the
FRONTIER Fibers transferred to FRONTIER in accordance with the foregoing
provisions of this Section 1.5, then such Sub-Easement shall terminate and such
title shall revert and be reconveyed to QWEST at the expiration or termination
of the Term respecting the applicable Segment as provided in and pursuant to
Article VI hereof.
ARTICLE II.
CONSIDERATION FOR GRANT
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2.1 In consideration of the grant of the IRUs hereunder by QWEST to
FRONTIER, FRONTIER agrees to pay to QWEST an IRU fee determined based on the
QWEST System route
mileage (and allocated among the Segments based on Segment route mileage) as
follows (the "IRU Fee"):
(a) Initially, the IRU Fee shall be determined based on the following per-
route-mile pricing:
(i) $
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per route mile for all Segments other than those (A) between
the cities of Cleveland and Boston, as identified in Exhibit A, (B) between the
City of Albany, New York and the location at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ in New York City,
as identified in Exhibit A, and (C) between the cities of Philadelphia and New
York City, as identified in Exhibit A; and
(ii) $
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per route mile for all Segments identified in clause
(a)(i)(A) above conditioned upon FRONTIER making available to QWEST at least
twenty-four (24) non-zero dispersion shifted Dark Fibers between Boston and ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ at a price not to exceed $
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(failing which condition the IRU
Fee shall be $
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per route mile for such Segments identified in clause (a)(i)(A))
and clause (a)(i)(B) above; and
(iii) $
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per route mile (unless the parties mutually agree on a
lesser amount) for all Segments identified in clause (a)(i)(C) above.
(b) If FRONTIER timely elects to exercise the System Fiber
Option in its entirety as provided pursuant to Section 1.4(a)(i), the
IRU Fee shall be redetermined based on the price of
(i) $
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per route mile for all Segments identified in
the clauses (a)(i) and (a)(ii) above; and
(ii) $
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per route mile (unless the parties mutually
agree on a lesser amount) for all Segments identified in
clause (a)(iii) above.
(c) If FRONTIER timely elects to cancel the System Fiber Option
in its entirety as permitted pursuant to Section 1.4(a)(ii)(A), the
IRU Fee shall be redetermined based on the price of
(i) $
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per route mile for all Segments identified in
the clauses (a)(i) and (a)(ii) above; and
(ii) $
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per route mile (unless the parties mutually
agree on a lesser amount) for all Segments identified in
clauses (a)(iii) above.
(d) If FRONTIER timely elects to exercise the System Fiber
Option in part, as permitted pursuant to Section 1.4(a)(ii)(B), the
IRU Fee shall be redetermined with respect to all Segments as follows:
(i) $
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per route mile for all Segments identified in
clauses (a)(i) and (a)(ii) above as to which the System Fiber Option
is exercised;
(ii) $
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CONFIDENTIAL TREATMENT##
per route mile for all Segments identified in
clauses (a)(i) and (a)(ii) above as to which the System Fiber Option
is canceled;
(iii) $
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CONFIDENTIAL TREATMENT##
for route mile (unless the parties
mutually agree on a lesser amount) for all Segments identified in
clause (a)(iii) above as to which the System Fiber Option is
exercised; and
(iv) $
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CONFIDENTIAL TREATMENT##
per route mile (unless the parties mutually
agree on a lesser amount) for all Segments identified in
clause (a)(iii) above as to which the System Fiber Option is
cancelled.
(e) If FRONTIER timely elects to exercise the Sacramento/Seattle Dark Fiber
Option as permitted pursuant to Section 1.4(b), the IRU Fee with respect to the
Sacramento/Seattle Segments (and only such Segments) shall be redetermined based
on a price of $
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CONFIDENTIAL TREATMENT##
per route mile.
(f) The IRU Fee shall (except as provided in Sections 1.2, 2.4 and 2.5) be
payable with respect to each Segment according to the payment schedule set forth
in Exhibit B.
2.2 (a) In addition to the IRU Fee payable under Section 2.1, if and to
the extent that the actual cost to QWEST (including freight and taxes) of the
fiberoptic cable that includes the FRONTIER Fibers to be incorporated in any
Segment is more than $
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CONFIDENTIAL TREATMENT##
/fiber foot, FRONTIER shall reimburse QWEST for the total
amount of such cost difference attributable to the FRONTIER Fibers incorporated
in such Segment (including slack); provided that QWEST shall give FRONTIER at
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least ten (10) days prior written notice before executing and submitting to a
vendor a firm commitment for any such fiberoptic cable. If and to the extent
that the actual cost to QWEST (including freight and taxes) of the fiberoptic
cable that includes the FRONTIER Fibers to be incorporated in an Segment is less
than $
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CONFIDENTIAL TREATMENT##
/fiber foot, FRONTIER shall receive a credit against amounts subsequently
payable by FRONTIER hereunder equal to the total amount of such cost difference
attributable to the FRONTIER Fibers incorporated in such Segment (including
slack).
(b) In the event that FRONTIER receives a bona fide quote from a fiberoptic
cable vendor to provide the same fiberoptic cable that QWEST would acquire to
install in a Segment hereunder in accordance with the QWEST System design and
the fiber deployment plan and fiber specification requirements provided herein,
at a price (including the business terms, handling charges and similar
incidental charges) lower than
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CONFIDENTIAL TREATMENT##
the best price available to QWEST for
such fiberoptic cable, FRONTIER shall notify QWEST in writing thereof,
identifying the vendor, the quoted price, and the type and quantity of
fiberoptic cable subject to such quote (each, a "Fiber Quote Notice"), such that
QWEST may attempt to acquire such fiberoptic cable at such price from such
vendor. If QWEST is able to acquire fiberoptic cable from the vendor and at the
price set forth in a Fiber Quote Notice for inclusion in a Segment or Segments
delivered hereunder, FRONTIER shall receive a credit against amounts
subsequently payable by FRONTIER hereunder equal to
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CONFIDENTIAL TREATMENT##
%) of the
difference between the best price available to QWEST for such fiberoptic cable
and the price obtained from such vendor pursuant to the Fiber Quote Notice (the
"Fiber Savings Credit") for the entire fiberoptic cable so acquired by QWEST for
inclusion in such Segment or Segments. If QWEST is unable, for any reason, to
acquire fiberoptic cable from the vendor identified in the Fiber Quote Notice or
any other vendor at the price set forth in the Fiber Quote Notice then the
foregoing provisions of this paragraph (b) shall have no further force and
effect and QWEST shall acquire fiberoptic cable through its own sources, subject
to paragraph (a) of this Section 2.2.
(c) Notwithstanding the foregoing provisions of paragraphs (a) and (b) of
this Section 2.2, no such reimbursement or credit shall be required with respect
to any fiberoptic cable including FRONTIER Fibers that, as of the date hereof,
has already been installed or
delivered to QWEST for installation in the QWEST System or is subject to a
binding purchase order for delivery to QWEST for installation in the QWEST
System. The amount of any such reimbursement or credit shall be invoiced or
credited, as appropriate, to FRONTIER at the time the fiberoptic cable
incorporating such FRONTIER Fibers is invoiced to QWEST. FRONTIER and QWEST
agree to reasonably consult and cooperate with each other in order to obtain the
lowest possible price for fiberoptic cable to be included in a Segment.
FRONTIER also shall pay directly or reimburse QWEST for all other costs, fees
and expenses which are expressly provided to be paid, in whole or in part, by
FRONTIER under this Agreement. FRONTIER shall have the right to review and
audit, at its cost, all such costs, fees and expenses.
2.3 QWEST will fax or send by overnight delivery each invoice for payments
to be made by FRONTIER hereunder. FRONTIER shall pay such invoiced amounts,
less any reasonably disputed amounts, for receipt by QWEST within fifteen (15)
days after receipt of such invoice by FRONTIER with respect to payments of the
IRU Fee and within thirty (30) days after receipt of such invoice by FRONTIER
for any other amounts owed to QWEST hereunder; provided that FRONTIER shall
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provide written notice describing in detail the basis for any disputed amounts;
and provided further that any disputed amounts that are resolved in favor of
---------------------
QWEST shall be due for payment based on the original invoice date. All payments
to be made by FRONTIER hereunder of the IRU Fee and of any other amounts in
excess of $100,000 shall be made by wire transfer of immediately available funds
to the account or accounts as QWEST shall notify FRONTIER in writing from time
to time. Payments of all other amounts by FRONTIER hereunder may be made by
check payable to QWEST. QWEST agrees to provide FRONTIER from time to time,
upon request, with QWEST's estimate of the next invoice date for a portion of
the IRU Fee and the estimated amount of such IRU Fee payment; provided that
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failure to provide any such notice shall not in any way alter or impair
FRONTIER's payment obligations hereunder.
2.4 QWEST and FRONTIER acknowledge and agree that with respect to Segment
23, notwithstanding the fact that Segment 23 has already been constructed and
installed, delivery of Segment 23 shall occur in two installments of twelve (12)
Dark Fibers each as indicated in Exhibit A, and payment of the IRU Fee therefor
(other than the initial
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CONFIDENTIAL TREATMENT##
% due upon execution of this Agreement), shall be
deferred until each such deferred installment delivery date as set forth in
Exhibit B. QWEST and FRONTIER further acknowledge and agree that with respect
to Segments 24A, 24B, 24C, 24D, 24E and 25, once constructed and installed,
delivery of each such Segment likewise shall occur in two installments of twelve
(12) Dark Fibers each as indicated in Exhibit A, and payment of the IRU Fee
therefor shall be made as set forth in Exhibit B.
2.5 QWEST and FRONTIER acknowledge and agree that with respect to Segments
5, 6, 9A, 9B, 10A and 10B, notwithstanding the payment schedule set forth in
Exhibit B and the fact that the conduit in such Segments has already been
constructed and
installed, FRONTIER shall be required to pay with respect to each of those
Segments: (a)
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CONFIDENTIAL TREATMENT##
% of the IRU Fee upon execution of this Agreement, (b)
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CONFIDENTIAL TREATMENT##
% of the
IRU Fee when (i) QWEST has commenced the placement of the Cable in the Segment,
and (ii) all such Cable and other materials necessary to complete such placement
within a reasonable time are on hand or scheduled for timely delivery in
connection with such placement, and (c) the balance of the IRU Fee in accordance
with the provisions of Exhibit B.
2.6 All of FRONTIER's payment obligations under this Agreement shall be
guaranteed by Frontier Corporation pursuant to a Guaranty in the form of Exhibit
K hereto, to be executed and delivered by Frontier Corporation as a condition to
the effectiveness hereof and the performance by QWEST of its obligations
hereunder.
ARTICLE III.
CONSTRUCTION OF THE QWEST SYSTEM
--------------------------------
3.1 QWEST shall, at QWEST's sole cost and expense, be responsible for and
shall effect the design, engineering, installation, and construction of those
portions of the QWEST System not already constructed as of the date hereof in
accordance with the System Route (as it may be modified pursuant to Section 1.1)
and in conformity with (i) the construction specifications set forth in Exhibit
C, (ii) industry standards and practices, and (iii) applicable Underlying Rights
Requirements (as defined in Section 11.1). Such responsibilities shall include,
without limitation, preparation of construction drawings, bills of materials,
materials specifications and materials requisitions. Except for the existing
fibers on Segments 11A, ▇▇▇, ▇▇▇, ▇▇▇, ▇▇▇ and 12D (which are Corning SMF-DS)
and any alternative fibers approved pursuant to the following sentence, all
fiber included in the FRONTIER Fibers shall be Corning SMF-LS non-zero
dispersion-shifted or Lucent Technologies True Wave and shall meet or exceed the
applicable fiber specifications set forth in Exhibit E. QWEST may use
alternative types of fiber equivalent to either of the aforementioned fibers;
provided that (i) prior to any such use, QWEST meets with FRONTIER (and
FRONTIER hereby agrees to so meet) to, cooperatively and in good faith,
jointly evaluate the use of any such fiber and (ii) thereafter, FRONTIER
approves the use of such fiber, which approval shall not be unreasonably
withheld or delayed. QWEST agrees that, to the extent possible in light of
the fiber already incorporated in Segments that have been constructed, in
whole or in part, prior to the date hereof and the availability and cost of
the fiber of a particular type and manufacture hereafter, fiber utilized
with respect to the loops, rings and regions of the QWEST System shall be
of the same type and manufacture, as depicted in the fiber deployment
diagram set forth in Exhibit E-1 hereto, indicating the type of fiber QWEST
currently plans to use in each such Segment.
Any deviation from the planned fiber use set forth in the diagram must be
approved by FRONTIER, which approval shall not be unreasonably withheld or
delayed.
3.2 Subject to extension for delays described in Article XX, QWEST shall
complete at QWEST's sole cost and expense, all construction, installation, and
satisfactory Fiber Acceptance Testing (as defined in Section 4.1) of each of the
Segments, including the provision of such Regeneration Facilities on such
Segment as are required to be provided pursuant to Section 7.2(a), by the
applicable "Estimated Delivery Date" (as defined in Section 33.1(d)) respecting
such Segment.
3.3 Except as may be provided herein, QWEST shall, at QWEST's sole cost
and expense, procure all materials to be incorporated in and to become a
permanent part of the QWEST System, including, without limitation, the
Regeneration Facilities required to be provided pursuant to Section 7.2(a).
3.4 QWEST shall, at QWEST's sole cost and expense, obtain all Underlying
Rights and other rights, licenses, permits and authorizations as required
pursuant to Article X hereof.
3.5 In support of QWEST's obligation to construct the QWEST System
hereunder, QWEST will provide, as a condition to FRONTIER's obligations
hereunder, either (i) so long as the Surety Bond has not been delivered as
provided in clause (ii) below, a guaranty up to a maximum aggregate amount of
$175 millionby Anschutz Company in favor of FRONTIER of the payment
obligations of QWEST under this Agreement pursuant to a Guaranty in the form
of Exhibit L or (ii) six (6) surety bonds in favor of FRONTIER, each
substantially in the form of and by the surety companies identified on
Exhibit I hereto or such other companies rated "A" or better by Best's Key
Rating Guide, which, in the aggregate, shall provide a total aggregate payment
value of not less than $175 million (collectively, the "Surety Bond"), in
each case clause (i) and (ii) over the entire construction period for all
Segments to be delivered hereunder.
3.6 QWEST shall perform, at QWEST's sole cost and expense, substantially
in accordance with industry standards and practices and as deemed necessary or
appropriate in QWEST's reasonable business judgment, all supervisory and
inspection services relating to the construction of the QWEST System, including,
without limitation, performing construction inspections to assure that all
construction shall be in material compliance with the specifications, drawings,
Underlying Rights, provisions of this Agreement, and applicable governmental
codes. During the course of construction of each Segment, QWEST shall prepare
and provide to FRONTIER construction schedule and progress reports every two
weeks. FRONTIER shall have the right, but not the obligation, to inspect the
construction of each Segment, including the installation, splicing and testing
of the FRONTIER Fiber incorporated therein, during the course and at the time of
the relevant design, construction and installation period. No inspection or
failure to inspect by FRONTIER shall impair or invalidate any rights and
remedies of FRONTIER under this Agreement or modify, amend or otherwise affect
any of the representations, warranties, covenants or agreements of QWEST under
this Agreement.
3.7 Upon FRONTIER's written request, QWEST shall make available for
inspection by FRONTIER, at QWEST's offices, copies of all information,
documents, agreements, reports, permits, drawings and specifications generated,
obtained or acquired by QWEST in performing its duties pursuant to this Article
III that are material to grant of the IRUs to FRONTIER, including, without
limitation, the Underlying Rights, subject only to the conditions that (i) the
terms of each such document or the legal restrictions applicable to such
information or document permits disclosure; provided that QWEST will use its
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best efforts (without requiring the expenditure of money) to obtain a waiver of
any existing confidentiality and/or non-disclosure restrictions, and to exempt
FRONTIER from subsequent confidentiality and/or non-disclosure restrictions,
that would restrict QWEST's ability to make such documents and/or information
available to FRONTIER for inspection; (ii) notwithstanding the existence or non-
existence of such restrictions and/or waivers, QWEST may, in its sole
discretion, redact portions of such documents it deems proprietary business
terms prior to FRONTIER's inspection. No inspection or failure to inspect by
FRONTIER shall impair or invalidate any rights and remedies of FRONTIER under
this Agreement or modify, amend or otherwise affect any of the representations,
warranties, covenants or agreements of QWEST under this Agreement.
3.8 QWEST shall use reasonable efforts to construct all of Segment 13C of
the Basic Route within the territorial confines of the United States, using its
reasonable efforts and reasonably cooperating with FRONTIER to determine a
construction method, including a powerline build or other alternative, in each
case that would be reasonably cost effective within the overall QWEST System
design. If, notwithstanding such efforts and cooperation, no such alternative
construction method is mutually agreed upon, then QWEST may construct the
portion of such Segment as shown in Exhibit A-2 in Mexico.
ARTICLE IV.
ACCEPTANCE AND TESTING OF FRONTIER FIBERS
-----------------------------------------
4.1 QWEST shall test all FRONTIER Fibers in accordance with the procedures
specified in Exhibit D ("Fiber Acceptance Testing") to verify that the FRONTIER
Fibers are installed and operating in accordance with the specifications
described in Exhibit D. Fiber Acceptance Testing shall progress span by span
along each Segment as cable splicing progresses, so that test results may be
reviewed in a timely manner. QWEST shall provide FRONTIER at least five (5)
days advance notice of the date and time of each Fiber Acceptance Testing such
that FRONTIER shall have the right, but not the obligation, to have a person or
persons present to observe QWEST's Fiber Acceptance Testing. When QWEST has
determined that the results of the Fiber Acceptance Testing with respect to a
particular span show that the FRONTIER Fibers so tested are installed and
operating in conformity with the applicable specifications set forth in Exhibit
D, QWEST shall promptly provide FRONTIER with a copy of such test results.
4.2 When QWEST reasonably determines in good faith that the FRONTIER Fibers
with respect to an entire Segment are installed and operating in conformity with
the applicable specifications set forth in Exhibit D, QWEST shall promptly
provide written notice of same to FRONTIER (a "Completion Notice"). FRONTIER
shall, within thirty (30) days of receipt of the Completion Notice, either
reject the Completion Notice specifying, in good faith, the defect or failure in
such Fiber Acceptance Testing or give QWEST written notice of acceptance of such
Fiber Acceptance Testing (the period from the date of FRONTIER's receipt of the
Completion Notice to the date of QWEST's receipt of FRONTIER's notice of
rejection or acceptance being referred to herein as the "FRONTIER Review
Period"). In the event FRONTIER rejects the Completion Notice, QWEST shall
promptly, and not later than seven days, and at no cost to FRONTIER, commence to
remedy the defect or failure. Thereafter QWEST shall again give FRONTIER a
Completion Notice with respect to such FRONTIER Fibers. The foregoing procedure
shall apply again and successively thereafter for a total of two attempts to
remedy the defect or failure. If QWEST fails to adequately remedy or complete
the defect or failure after two attempts, FRONTIER shall have the right to
proceed promptly and in an economically efficient manner to cure such defects or
failures at QWEST's cost and expense, which shall be paid by QWEST to FRONTIER
upon demand, or at the election of FRONTIER, offset from any IRU Fee payable by
FRONTIER to QWEST with respect to such Segment or any other Segment. No
acceptance of, or failure by FRONTIER to reject, the Completion Notice shall be
deemed to be a waiver of any rights or remedies of FRONTIER under this
Agreement; provided that, any failure by FRONTIER to timely reject as set forth
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above shall operate as a constructive acceptance for purposes of this Agreement.
The date when FRONTIER accepts or is deemed to have accepted a Completion Notice
or cures such defects at QWEST's cost and expense as provided above with respect
to a Segment is herein defined as the "Acceptance Date".
ARTICLE V.
DOCUMENTATION
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5.1 QWEST shall provide FRONTIER with a copy of all Underlying Right
Requirements (as defined in Section 11.1) applicable to each Segment promptly
following the grant to QWEST of the Underlying Right pursuant to which such
Underlying Right Requirements are imposed and, in any event, on or before the
date of completion of conduit installation in such Segment (as defined in
Exhibit B, paragraph 6(ii)).
5.2 Not later than ninety (90) days after the Acceptance Date for each
Segment, QWEST shall provide FRONTIER with the following documentation:
(a) As-built drawings for such Segment in accordance with the requirements
described in Exhibit C ("As-Builts").
(b) Technical specifications of the optical fiber cable and associated
splices and other equipment placed in that Segment.
5.3 As a condition to, and effective upon receipt of, each IRU Fee payment
installment that is due upon QWEST's achievement of a construction,
installation, testing or acceptance milestone as set forth in Exhibit B, QWEST
shall deliver to FRONTIER a lien waiver with respect to liens in favor of QWEST
arising out of QWEST's services in accomplishing such milestone. Promptly
following QWEST's receipt of each such payment, QWEST shall use reasonable
efforts to obtain (and in any event on or before the Acceptance Date with
respect to the relevant Segment shall obtain) from each subcontractor that
provided services in accomplishing such milestone a lien waiver with respect to
liens arising out of such services and, upon receipt, deliver a copy of each
such lien waiver to FRONTIER.
ARTICLE VI.
TERM
----
6.1 Except to the extent expressly modified by Section 1.2 with respect to
the Segments identified therein, the grant of the IRUs hereunder with respect to
each Segment shall become effective on the first day when both (i) the
Acceptance Date with respect to that Segment has occurred and (ii) QWEST has
received payment in full of the IRU Fee with respect to such Segment in
accordance with Exhibit B, and, subject to the provisions of Article X, such
grant shall terminate at the end of the economically useful life of the FRONTIER
Fibers, as reasonably determined by FRONTIER pursuant to Section 6.2 below. The
period of each such grant respecting each such Segment and IRU is herein defined
as the "Term".
6.2 In the event that FRONTIER, at any time, reasonably determines that
the FRONTIER Fibers comprising any Segment have reached the end of their
economically useful life and desires to not retain the IRU in such Segment,
FRONTIER shall have the right to abandon the IRU with respect to such Segment by
written notice to QWEST. If, at any time during or after the last year of the
Minimum Period (as defined in Section 10.2(ii) below), with respect to any
Segment, FRONTIER fails to use any of the FRONTIER Fibers comprising such
Segment for any period of thirty (30) consecutive days (except to the extent
that such non-use is as a result of any of the events described in Article XX or
as a result of QWEST System maintenance, restoration, relocation, or
reconfiguration or as a result of the failure of QWEST to observe and perform
the terms of this Agreement), QWEST shall have the right to request FRONTIER to
acknowledge that the FRONTIER Fibers comprising such Segment have reached the
end of their economic life and, accordingly, has abandoned the FRONTIER Fibers
comprising such Segment (which acknowledgment shall not be unreasonably withheld
or delayed). Upon any such notice of abandonment or acknowledgment, the Term
shall expire with respect to such Segment and all rights to the use of such
Segment shall revert to QWEST without reimbursement of any fees or other
payments previously made with respect thereto, and from and after such time
FRONTIER shall have no further rights or obligations hereunder with respect to
such Segment (subject to the provisions of Article XIX).
6.3 It is understood and agreed as between the parties that the grant of
the IRUs hereunder shall be treated for accounting and federal and all
applicable state and local tax purposes as the sale and purchase of the FRONTIER
Fibers and a corresponding interest in QWEST's rights in the Associated Property
subject thereto, and that on and after the Acceptance Date with respect to each
Segment, FRONTIER shall be treated as the owner of the FRONTIER Fibers and an
interest in QWEST's rights in the Associated Property comprising such Segment
for such purposes. The parties agree to file their respective income tax
returns, property tax returns, and other returns and reports for their
respective Impositions (as such term is defined in Section 33.1(e)) on such
basis and, except as otherwise required by law, not to take any positions
inconsistent therewith. QWEST shall retain legal title to the entire QWEST
System (except if and to the extent provided in Section 1.5), including the
FRONTIER Fibers and Associated Property subject to the IRUs hereunder. Each
party agrees to indemnify the other with respect to any late filing penalties,
interest or fees incurred as a result of such party's failure to provide the
other with such information solely in such party's possession or control that
may be necessary in order to timely make any such filing.
6.4 This Agreement shall become effective on the date hereof and shall
terminate on the date when, after completion and delivery of all Segments
required to be delivered hereunder, all the Terms of all such Segments shall
have expired; provided that, those provisions of this Agreement which, by their
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express terms, are intended to survive such termination, shall survive.
ARTICLE VII.
NETWORK ACCESS; REGENERATION FACILITIES
---------------------------------------
7.1 (a) QWEST shall provide FRONTIER with access to, and FRONTIER shall
have the right to connect, at FRONTIER's sole cost and expense, its
telecommunications system with, the FRONTIER Fibers at various network access
points on the QWEST System right-of-way in each of the endpoint cities and
intermediate point cities along the route of each Segment and at such additional
locations along the QWEST System right-of-way as may be requested by FRONTIER
(each such access point being referred to as a "Connecting Point"). The
specific locations of each such Connecting Point shall be as mutually reasonably
agreed upon by the parties in good faith, subject to the Underlying Rights
Requirements and QWEST obtaining other required permits, authorizations and
approvals (which QWEST agrees to use its best efforts to obtain). Any such
connection will be performed by QWEST, at FRONTIER's sole cost and expense, in
accordance with QWEST's applicable specifications and operating procedures.
FRONTIER shall pay QWEST's Costs for each such connection within thirty (30)
days of the date of FRONTIER's receipt of QWEST's invoice therefor. In order to
schedule a connection of this type, FRONTIER shall request and coordinate such
work not less than ninety (90) days in advance of the date the connection is
requested to be completed. Such work will be restricted to a Planned System
Work Period ("PSWP"), as defined in Section 33.1(i), unless otherwise agreed to
in writing for specific projects. Subject to all applicable Underlying Rights
Requirements, FRONTIER shall also be provided reasonable access by QWEST to any
Connecting Point at all times. FRONTIER shall have no limitations on the
types of electronics or technologies employed to utilize the FRONTIER Fibers,
subject to mutually agreeable safety procedures and so long as such
electronics or technologies do not interfere with the use of or present a risk
of damage to any portion of the QWEST System.
(b) QWEST may route the FRONTIER Fibers through QWEST's separate terminal,
endlink, POP or Regeneration Facilities at its sole discretion so long as such
routing does not have a material adverse effect on the security, the safety or
FRONTIER's use of the FRONTIER Fibers or Associated Property hereunder and QWEST
is responsible for all costs and expenses associated therewith.
7.2 (a) The IRU Fee includes QWEST's provision to FRONTIER for its use as
permitted hereunder of
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regeneration site facilities along the Basic
Route, and
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CONFIDENTIAL TREATMENT##
regeneration site facilities along the Optional Routes (consisting of
up to
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CONFIDENTIAL TREATMENT##
for Option Route 1, up to
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CONFIDENTIAL TREATMENT##
for Option Route 1A and up to
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for
Option Route 2, depending upon which of the Optional Routes are elected or
required to be constructed pursuant to Section 1.3 hereof)
to be located at approximately sixty (60) mile intervals along the QWEST System
right-of-way, in each case consisting of and providing space of approximately
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CONFIDENTIAL TREATMENT##
square feet and amenities (except for the operating costs associated
therewith expressly required to be paid by FRONTIER pursuant to Section 8.2), as
described in Exhibit F ("Regeneration Facilities"). The parties acknowledge
that (i) the locations of such Regeneration Facilities shall be coincident with
the locations of QWEST's own Regeneration Facilities (and located at
approximately 60-mile intervals), the locations of which QWEST shall notify
FRONTIER with sufficient time (no less than ten working days) for FRONTIER to
request a different location for any given facility, in which case the parties
shall mutually agree on a mutually acceptable location for such facility, and
(ii) Exhibit G sets forth the estimated number of such Regeneration Facilities
by Segment, with the locations of such Regeneration Facilities being subject to
final determination of the route of the applicable Segment, space and power
availability and all applicable Underlying Rights Requirements. In addition,
QWEST shall provide to FRONTIER at FRONTIER's Prorated Cost (as defined below in
this paragraph (a)) POP or terminal facilities of approximately
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CONFIDENTIAL TREATMENT##
square
feet along the QWEST System right-of-way at such locations as may be mutually
determined by FRONTIER and QWEST, subject to space and power availability and
Underlying Rights Requirements
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CONFIDENTIAL TREATMENT##
subject to space and power
availability and underlying Rights Requirements. FRONTIER's occupancy of and
access to all such Regeneration Facility Sites (or POP or terminal facilities)
shall include separate, secured, 24-hour-per-day building access. Any
Regeneration Facilities (or POP or terminal facilities) provided by QWEST to
FRONTIER
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CONFIDENTIAL TREATMENT##
with respect to any of the Basic Route and the applicable
Optional Routes shall be at FRONTIER's Prorated Cost. For purposes of the
foregoing two sentences, FRONTIER's Prorated Cost for Regeneration Facilities
means $
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CONFIDENTIAL TREATMENT##
per facility and for POP or terminal facilities means $
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CONFIDENTIAL TREATMENT##
per
facility, subject to any adjustment (lower or higher) pursuant to Section 7.2(b)
below.
(b) QWEST heretofore has requested (or promptly after execution of this
Agreement will request) vendors to submit bids (collectively, the "Initial
Bids") that cover all or
substantially all of the proposed Basic Segments of the QWEST System (plus the
Optional Routes as and when included in any bid requests by QWEST) for the
building items listed below (collectively, the "Building Items"). QWEST has
delivered (or promptly after receipt thereof will deliver) to FRONTIER copies of
such Initial Bids. If the aggregate cost of the Building Items taking the
lowest quoted cost per Building Item (subject to the last sentence of this
paragraph) under any of the Initial Bids (the "Initial Bid Aggregate Cost") is
equal to or less than the aggregate estimated cost for the Building Items set
forth in the table below (the "Estimated Aggregate Cost"), then for 10 business
days thereafter, or if the Initial Bid Aggregate Cost is more than the Estimated
Aggregate Cost, then for 20 business days thereafter, FRONTIER may solicit from
the same or other vendors bids that cover all or substantially all of the Basic
Segments of the QWEST System (plus the Optional Routes as and when included in
any bid requests by QWEST) covering any of the Building Items (the "FRONTIER
Solicited Bids"). Without regard to what Building Items QWEST actually purchases
in connection with construction of the QWEST System, the lowest quoted cost per
Building Item obtained under any of the Initial Bids and the Frontier Solicited
Bids (subject to the last sentence of this paragraph) shall then be used in
place of the cost set forth in the table below for the respective Building Item,
and the allocated percentage of the total cost (which excludes freight and
taxes) attributable to FRONTIER as set forth in the table below shall be applied
accordingly to the recalculated cost. The aggregate FRONTIER allocation set
forth in the table below shall be recalculated, and the Prorated Cost for
Regeneration Facilities of $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
per facility and the Prorated Cost of POPs (and
terminal facilities) of $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
per facility shall be increased or decreased, as
appropriate, by the difference between such recalculated aggregate FRONTIER
allocation and $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
. In determining whether a quote represents the "lowest
quoted cost" for any particular Building Item, (i) such quote must meet all of
QWEST's terms and specifications with respect to the applicable Building Item
and (ii) QWEST shall take into account whether and to what extent such quote is
contingent upon any other quote for one or more other Building Items.
For purposes of this Section 7.2(b), the building items in Regeneration
Facilities and/or POPs or terminal facilities, their respective total cost, the
Estimated Aggregate Cost of them and the allocated FRONTIER percentage with
respect to them are as follows:
Allocation Frontier
Building Items Total Cost of Item Percentage Allocation
--------------- ------------------ ---------- ----------
Equipment building, $
12' x 30'0.0
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
80 kW skid-mounted diesel generator
(Regeneration Facility)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
100 kW skid-mounted diesel generator
(POP)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
Two 5 ton wall mounted HVAC units
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
Battery Plant, 1,200 Amp @ 48 VDC
each for 400A of rectifiers
a. Power distribution
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
b. Rectifiers
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
c. Batteries (4 hr. reserve,
dual 875 AH strings)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
Estimated Aggregate Cost $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
(c) Payment by FRONTIER of its Prorated Cost, adjusted to give effect to
any adjustments (lower or higher) pursuant to Section 7.2(b), for any POP or
terminal facilities shall be paid to QWEST upon commencement of the construction
of the Segment of which they are a part. Payment by FRONTIER of its Prorated
Cost adjusted to give effect to any adjustments (lower or higher) pursuant to
Section 7.2(b), for Regeneration Facilities
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
shall be paid to QWEST upon
commencement of the construction of the Segment of which they are a part
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
.
The foregoing amounts paid by FRONTIER shall be finally trued up, with QWEST
reimbursing FRONTIER for any excess and FRONTIER paying QWEST for any
deficiency, on (or as soon as thereafter as practicable) the last Acceptance
Date with respect to the Basic Segments, the last Acceptance Date with respect
to Segments in Option Route 1 or 1-A, and the last Acceptance Date with respect
to Segments in Option Route 2, in each case (i) based on the actual number of
Regeneration Facilities actually provided by QWEST
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
or POPs (or terminal
facilities) with respect to the Basic Route and the applicable Optional Route
and (ii) adjusted to give effect to any adjustments (lower or higher) in the
FRONTIER's Prorated Cost to which FRONTIER may be entitled under Section 7.2(b)
above.
ARTICLE VIII.
OPERATIONS
----------
8.1 Each party shall have full and complete control and responsibility
for determining any network and service configuration or designs, routing
configurations, regrooming, rearrangement or consolidation of channels or
circuits and all related functions with regard to the
use of that party's Dark Fiber.
8.2 FRONTIER shall reimburse QWEST for FRONTIER's proportionate share
of all operating costs incurred by QWEST in connection with the Regeneration
Facilities (or alternatively requested POP or terminal facilities) provided
pursuant to Section 7.2(a), including its proportionate share of any monthly
lease costs for any such facilities and/or underlying property that QWEST leases
(including, to the extent included in such lease costs, base rent, maintenance,
insurance, security and taxes), maintenance of such facilities, and all power
and utility fees and charges. FRONTIER's proportionate share of such operating
costs, including a proportionate share of common area costs, shall be the ratio
that the floor space provided to FRONTIER in any such facility (including a
proportionate share of the common area) bears to (i) in the case of lease costs,
the total space in such facility, and (ii) in the case of all other costs
(including common area costs), the total utilized space in such facility. QWEST
shall submit invoices to FRONTIER on an annual basis for FRONTIER's pro rata
share of such operating costs during the preceding twelve months. FRONTIER's
reimbursement obligations for insurance and taxes pursuant to this Section 8.2
shall in no event be duplicative of FRONTIER's payment obligations for insurance
or taxes, respectively, as provided in Article XIV and XV hereof, and in no
event shall relieve QWEST of its payment obligations for insurance costs or
taxes, respectively, as provided in Article XIV and XV hereof.
8.3 FRONTIER acknowledges and agrees that, except to the extent
expressly provided pursuant to Sections 1.2 and 7.2, QWEST is not supplying nor
is QWEST obligated to supply to FRONTIER any optronics or electronics or optical
or electrical equipment or other facilities, including without limitation,
generators, batteries, air conditioners, fire protection and monitoring and
testing equipment, all of which are the sole responsibility of FRONTIER, nor is
QWEST responsible for performing any work other than as specified in this
Agreement.
8.4 Upon not less than one hundred twenty (120) days' written notice
from QWEST to FRONTIER, QWEST may, subject to FRONTIER's prior written approval
(which approval shall not be unreasonably delayed or withheld) substitute for
the FRONTIER Fibers on the QWEST System, or any Segment or Segments comprising a
portion of said QWEST System, an equal number of alternative fibers along the
same or an alternative route; provided that in any such event, such substitution
-------------
(i) shall be in accordance with FRONTIER's applicable specifications and
operating procedures, (ii) shall be effected at the sole cost of QWEST,
including, without limitation, all disconnect and reconnect costs, fees and
expenses, (iii) shall be constructed and tested in accordance with the
specifications and drawings set forth in Exhibits C and D and Section 4.2, and
incorporate fiber meeting the specifications set forth in Exhibit E, and (iv)
shall not interrupt or adversely affect the use, operation or performance of
FRONTIER's network or business, or change any Connecting Points or endpoints of
any Segment or change the location of any Regeneration Facilities (or POPs or
terminal facilities) used by FRONTIER hereunder or any other FRONTIER POP, node
or switch facilities, all as determined by FRONTIER, in its sole discretion; and
provided further that QWEST shall give FRONTIER written notice prior to QWEST's
placing any order for fiber for such alternative route segment or
segments if the number of fibers to be placed in such alternative route segment
or segments exceeds the number of fibers in the Segment or Segments to be so
relocated, and FRONTIER shall have a period of thirty (30) days from receipt of
such notice to commit, by written notice to QWEST, to acquire an IRU in an
additional number of Dark Fibers (i.e., in excess of the number of FRONTIER
Fibers to be so substituted) (subject to the availability of adequate conduit
capacity) for a per-fiber IRU fee
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
.
ARTICLE IX.
MAINTENANCE AND REPAIR OF THE QWEST SYSTEM
------------------------------------------
9.1 From and after the Acceptance Date with respect to each Segment,
the maintenance of the QWEST System comprising such Segment shall be provided in
accordance with the maintenance requirements and procedures set forth in Exhibit
H hereto.
ARTICLE X.
PERMITS; UNDERLYING RIGHTS; RELOCATION
--------------------------------------
10.1 QWEST covenants and agrees that it shall obtain, during the
course of construction of, and in any event on or before the completion of
conduit installation with respect to, each Segment of conduit to be delivered
hereunder all Underlying Rights (as defined below) and such other rights,
licenses, permits, authorizations, and approvals (including, without limitation,
any necessary local, state, federal or tribal authorizations and environmental
permits) that are necessary in order to permit QWEST to construct, install and
maintain the conduit and the FRONTIER Fibers to be encompassed in such Segment
in accordance with the terms and conditions hereof. QWEST further covenants and
agrees that it shall obtain, during the course of construction of and in any
event on or before the Acceptance Date with respect to each Segment to be
delivered hereunder, any and all rights-of way, easements, licenses and other
agreements relating to the grant of rights and interests in and/or access to the
real property underlying the QWEST System (collectively, the "Underlying
Rights") and such other rights, licenses, permits, authorizations, and approvals
(including without limitation, any necessary local, state, federal or tribal
authorizations and environmental permits) that are necessary in order to permit
QWEST to grant the IRUs, and otherwise to perform its obligations hereunder, in
accordance with the terms and conditions hereof, and to (and all of which
Underlying Rights shall) permit FRONTIER to use the FRONTIER Fibers and
Associated Property as provided and permitted hereunder and in accordance with
the terms and conditions hereof. QWEST shall use its best efforts to cause the
terms of each such Underlying Right to provide FRONTIER with notice of any
default on the part of QWEST and to permit FRONTIER to cure, on behalf of QWEST,
any such default by QWEST and, thereafter, to continue the use of such
Underlying Right in accordance with QWEST's rights and interests thereunder and,
if FRONTIER at any time cures such default by QWEST, QWEST shall reimburse
FRONTIER for any and all amounts reasonably paid by
FRONTIER promptly upon demand.
10.2 QWEST further covenants and agrees that, with respect to each
Underlying Right that is necessary in order to continue and maintain the IRUs
granted hereunder, and to permit FRONTIER to exercise its rights to use the
FRONTIER Fibers and Associated Property, in each case in accordance with the
terms and conditions hereof:
(i) QWEST shall, for a period of
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
years from the date hereof (or until
the earlier to occur of (A) the expiration of the economically useful life of
the FRONTIER Fibers, as determined pursuant to Section 6.2, or (B) the
expiration or termination of the term of a particular Underlying Right, so long
as any such termination is not effected as a result of any failure of QWEST (not
caused as a result of FRONTIER's failure to observe and perform its obligations
hereunder) to observe and perform its duties, obligations and responsibilities
under such Underlying Right or under this Agreement, including under this
Article X), observe and perform each and every of its obligations under each
document, agreement or instrument granting or conveying to QWEST such an
Underlying Right if the failure to observe and perform any such obligation or
obligations would permit the grantor of such Underlying Right to terminate such
Underlying Right prior to its stated expiration date, or would otherwise
materially, adversely impair or affect FRONTIER's ability to use the FRONTIER
Fibers and Associated Property, or exercise its rights with respect thereto, as
provided and permitted hereunder; and
(ii) QWEST shall either require that the initial stated term of each such
Underlying Right be for a period that does not expire, in accordance with its
ordinary terms, prior to the last day of the Minimum Period (as hereinafter
defined with respect to each Segment) or, if the initial stated term of any such
Underlying Right expires, in accordance with its ordinary terms, on a date
earlier than the last day of the Minimum Period, QWEST shall at its cost
exercise any renewal rights thereunder, or otherwise acquire such extensions,
additions and/or replacements as may be necessary, in order to cause the stated
term thereof to be continued until a date that is not earlier than the last day
of the Minimum Period. The "Minimum Period" shall be, with respect to each
Segment, the period from the date on which construction of such Segment
commences until the
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
anniversary of such date; and
(iii) From and after the last day of the Minimum Period, QWEST
shall use its best efforts (without being required to expend commercially
unreasonably amounts therefor) to obtain such extensions and/or renewals as may
be necessary in order to cause the stated term of each such Underlying Right to
be continued for an additional period or periods of, in the aggregate,
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
years following the Minimum Period or until the earlier expiration of the
economically useful life of the FRONTIER Fibers, as determined pursuant to
Section 6.2; provided that QWEST shall not be required to expend, as
-------------
consideration for any such renewal or extension, more than the fair market rate
payable at such time for similar rights and terms except
to the extent that FRONTIER agrees at its option to pay directly or reimburse
QWEST for any amounts required to be paid in excess of such fair market rate to
renew or extend such an Underlying Right; and
(iv) Throughout the term of each such Underlying Right, QWEST shall at its
reasonable cost and expense defend and protect QWEST's rights in and interests
under the Underlying Rights against interfering or infringing rights, interests
or claims of third parties.
10.3 Upon the expiration or termination of any Underlying Right that
is necessary in order to grant, continue or maintain an IRU granted hereunder in
accordance with the terms and conditions hereof, so long as QWEST shall have
fully observed and performed its obligations under this Article X with respect
thereto, the Term of the IRUs hereunder with respect to any Segment or Segments
affected thereby shall automatically expire upon such expiration or termination.
10.4 If, after the Acceptance Date with respect to a Segment, QWEST is
required by a third party with legal authority to so require (including, without
limitation, the grantor of an Underlying Right, but only to the extent that such
relocation is not required as a result of a failure by QWEST to observe and
perform its obligations under such Underlying Right or this Agreement), or if
FRONTIER agrees, to relocate any portion of such Segment including any of the
facilities used or required in providing the IRUs in such Segment hereunder,
QWEST shall proceed with such relocation, including, but not limited to, the
right, in good faith, to reasonably determine the extent of, the timing of, and
methods to be used for such relocation; provided that (i) the route of any such
-------------
relocation shall be subject to the good faith agreement of the parties with a
bona fide interest therein, (ii) FRONTIER shall be kept fully informed of all
other determinations made by QWEST in connection with such relocation, and (iii)
any such relocation shall be constructed and tested in accordance with the
specifications and drawings set forth in Exhibits C and D, and incorporate fiber
meeting the specifications set forth in Exhibit E. FRONTIER shall reimburse
QWEST for its proportionate share of the Costs of such relocation of the portion
of the Segment so relocated, reduced by such amount, if any, of the portion of
such Costs as are reimbursed to QWEST by the party requiring such relocation, as
follows: (i) if the affected portion of the Segment includes any conduit other
than the conduit housing the FRONTIER Fibers for which QWEST is responsible for
relocation costs, the total Costs of relocation of the conduits (i.e.,
relocation of the conduits only without regard to whether the conduits contain
fibers) shall be allocated based on the overall number of conduits relocated;
(ii) such Costs allocated to the conduit carrying the FRONTIER Fibers plus the
Costs specifically associated with the relocation of the fiber (i.e., relocation
of the fiber only without regard to relocation of conduit) shall be further
allocated to FRONTIER based on FRONTIER's proportionate share of (A) all Costs
of fiber acquisitions, splicing and testing, prorated based on the total fiber
count in the affected Cable, as so relocated, and (B) all other Costs associated
with the relocation of the conduit housing the affected Cable, prorated based on
the total number of owners (including QWEST) and holders of IRUs or equivalent
interests (including long-term lessees) (each, an "Interest Holder") in the
affected Cable, as so relocated. FRONTIER shall
have the right to review and audit all Costs incurred in connection with such
relocation. QWEST shall deliver to FRONTIER updated As-Builts with respect to
the relocated Segment not later than sixty (60) days following the completion of
such relocation. Any condemnation or taking under the power of eminent domain
of all or any portion of a Segment shall be deemed a relocation required by a
third party with legal authority to so require, and such affected Segment, or
portion thereof, shall be relocated in accordance with this Section 10.4 and any
condemnation proceeds received by QWEST shall be applied to such relocation as
provided above.
10.5 QWEST acknowledges that FRONTIER has previously committed to
acquire a certain number of miles of right-of-way from ConRail (the "ConRail
ROW"). If determined practical by QWEST in its reasonable business judgment,
and provided that the cost and other terms and conditions of acquiring and
utilizing part or all of the ConRail ROW are not greater or more restrictive and
do not provide lesser rights than any other Underlying Right which QWEST may be
hereafter required to acquire in constructing the QWEST System, QWEST shall
cooperate with FRONTIER and acquire and utilize the ConRail ROW, or applicable
portions thereof, in satisfaction of the FRONTIER commitment to ConRail. In
such event, the IRU Fee payable hereunder with respect to any Segment on the
ConRail ROW shall be adjusted as agreed by the parties.
ARTICLE XI.
USE OF QWEST SYSTEM
-------------------
11.1 The requirements, restrictions, and/or limitations upon
FRONTIER's right to use the FRONTIER Fibers and Associated Property as provided
and permitted under this Agreement imposed under, and associated safety,
operational and other rules and regulations imposed in connection with, the
Underlying Rights are referred to collectively as the "Underlying Rights
Requirements." QWEST represents and warrants that, it has made available to
FRONTIER for its review and inspection a copy of certain documents, agreements,
or instruments pursuant to which QWEST has been granted an Underlying Right as
of the date hereof (the "Existing Underlying Rights"), and certain associated
safety, operational and other rules and regulations imposed in connection with
the exercise of its rights thereunder (all of which are identified on Exhibit J
hereto). FRONTIER hereby accepts the Existing Underlying Rights and the
Underlying Rights Requirements associated therewith. QWEST represents that it
is not in default under any of the Existing Underlying Rights that would permit
the grantor of such Underlying Right to terminate such Underlying Right prior to
its stated expiration date, or would otherwise materially, adversely impair or
affect FRONTIER's ability to use the FRONTIER Fibers and Associated Property, or
exercise its rights with respect thereto, as provided and permitted hereunder,
and, to the best of its knowledge, none of the grantors are in default under the
Existing Underlying Rights. With respect to each Underlying Right (other than
the Existing Underlying Rights) obtained after the date hereof by QWEST (or an
Underlying Right existing on the date hereof under any document, agreement or
instrument delivered after the date hereof) in carrying out its obligations
hereunder from the same type of grantor as a grantor of any
Existing Underlying Right, QWEST represents and warrants that the terms and
conditions thereof, and rules and regulations imposed in connection therewith,
shall not impose materially more onerous limitations and restrictions on the
rights of FRONTIER to use the FRONTIER Fibers and Associated Property as
permitted and provided hereunder than those imposed by such type of grantor
under and in connection with the Existing Underlying Rights and Underlying
Rights Requirements associated therewith. To the extent that any such
Underlying Right documents, agreements or instruments were or hereafter are
provided in a redacted format to protect confidential and proprietary business
terms, QWEST represents and warrants that no language or information so redacted
constitutes an Underlying Rights Requirement nor otherwise imposes material
requirements, restrictions and/or limitations upon FRONTIER's right to use the
FRONTIER Fibers and Associated Property as provided and permitted hereunder.
QWEST represents to FRONTIER that the map heretofore provided to FRONTIER
delineating the general location of rights of way, easements and other rights
held by QWEST under the principal agreements evidencing the Existing Underlying
Rights is a true and complete depiction, in all material respects, with respect
to the general location of such Existing Underlying Rights that relate to the
FRONTIER Fibers to be installed along the QWEST System as contemplated by this
Agreement.
11.2 FRONTIER represents, warrants and covenants that it will use the
FRONTIER Fibers and Associated Property in compliance with (i) all applicable
government codes, ordinances, laws, rules, regulations and/or restrictions, and
(ii) subject to QWEST's obligations under Section 11.1, the Underlying Rights
Requirements.
11.3 In addition to the other rights provided hereunder, but subject
to the provisions of Article VII, the IRUs granted hereunder shall include the
right at FRONTIER's cost to install additional equipment, or replace existing
equipment, in the facility space provided to FRONTIER pursuant to Article VII,
subject to the Underlying Rights Requirements.
11.4 QWEST agrees and acknowledges that it has no right to use the
FRONTIER Fibers during the Term hereof, and that, from and after the effective
date of the grant of each IRU hereunder, QWEST shall keep the FRONTIER Fibers,
the Associated Property and the IRUs granted hereunder (other than any
Associated Property (excluding any Associated Property that may be covered by
the Pre-Existing Cal-Fiber Lien as to which QWEST agrees to use its best efforts
to provide a nondisturbance agreement substantially to the effect described in
the next sentence) as to which QWEST shall have provided to FRONTIER a
nondisturbance agreement substantially to the effect as described in the next
sentence) free from (i) any liens of any third party attributable to QWEST, and
(ii) any rights or claims of any third party attributable to QWEST, as and to
the extent required pursuant to Article X hereof. In addition, QWEST agrees
that, from and after the execution of this Agreement and until the effective
date of the grant of each IRU hereunder with respect to any Segment, it shall
obtain from any entity in favor of which QWEST in its discretion shall have
granted a security interest or lien on all or part of such
Segment (excluding the Pre-Existing Cal-Fiber Lien) a written nondisturbance
agreement substantially to the effect that such lienholder acknowledges
FRONTIER's rights and interests in and to the FRONTIER Fibers, the Associated
Property and the IRU's hereunder and agrees that the same shall not be
diminished, disturbed, impaired or interfered with by such lienholder.
11.5 Subject to the provisions of Article XXV and this Article XI,
FRONTIER may use the FRONTIER Fibers, the Associated Property and the IRUs for
any lawful telecommunications purpose. For purposes of this Section 11.5
"telecommunications" shall have the meaning as used and interpreted in 47 U.S.C.
' 153(2)(43). FRONTIER agrees and acknowledges that it has no right to use any
of the fibers, other than the FRONTIER Fibers, included in the Cable or
otherwise incorporated in the QWEST System, and that FRONTIER shall keep any and
all of the QWEST System, other than the IRU in the FRONTIER Fibers or in the
Associated Property, free from any liens, rights or claims of any third party
attributable to FRONTIER.
11.6 FRONTIER and QWEST shall promptly notify each other of any
matters pertaining to, or the occurrence (or impending occurrence) of, any event
which could give rise to any damage or impending damage to or loss of the QWEST
System that are known to such party. Without limiting the generality of the
foregoing, QWEST shall promptly forward to FRONTIER a copy of any notice of
default received by QWEST with respect to its obligations under any Underlying
Right if such default is not promptly cured by QWEST.
11.7 FRONTIER shall not use the FRONTIER Fibers in a way which
physically interferes in any way with or adversely affects the use of the fibers
or cable of any other person using the QWEST System, it being expressly
acknowledged that the QWEST System includes or will include other participants,
including QWEST and other owners and holders of Dark Fiber IRUs and
telecommunication system operations. QWEST shall not use any other fibers in
the QWEST System in a way which physically interferes with or adversely affects
the use of the FRONTIER Fibers, and shall obtain a similar agreement from any
person that acquires the right to use fibers in the QWEST System after the date
hereof.
11.8 FRONTIER and QWEST each agree to cooperate with and support the
other in complying with any requirements applicable to their respective rights
and obligations hereunder by any governmental or regulatory agency or authority.
11.9 QWEST agrees, so long as any such action would not violate the
terms of any Underlying Right, upon request of FRONTIER, to execute, file and/or
record such documents or instruments as FRONTIER shall deem reasonably necessary
or appropriate to evidence or safeguard the IRUs granted to FRONTIER hereunder.
FRONTIER agrees to reimburse QWEST for all reasonable costs and out-of-pocket
expenses (including, without limitation, reasonable fees and expenses of legal
counsel) incurred by QWEST in fulfilling its obligations under this Section
11.9.
ARTICLE XII.
INDEMNIFICATION
---------------
12.1 Subject to the provisions of Articles XIII and XVIII, QWEST
hereby releases and agrees to indemnify, defend, protect and hold harmless
FRONTIER and its employees, officers and directors, from and against, and
assumes liability for:
(a) Any injury, loss or damage to any person (including FRONTIER), tangible
property or facilities of any person or entity (including reasonable attorneys'
fees and costs) to the extent arising out of or resulting from the acts or
omissions, negligent or otherwise, of QWEST, its officers, employees, servants,
affiliates, agents, contractors, licensees, invitees or vendors arising out of
or in connection with a default (other than a default caused by a failure of
FRONTIER to perform or comply with its obligations hereunder) by QWEST in the
performance of its obligations or breach of its representations under this
Agreement (including, without limitation, any default by QWEST in the
performance of its obligations under Article X with respect to the Underlying
Rights and under Article XI with respect to its use of the QWEST System); and
(b) Any claims, liabilities or damages, including reasonable attorneys'
fees and costs, arising out of any violation by QWEST of any regulation, rule,
statute or court order of any local, state or federal governmental agency, court
or body in connection with the performance of its obligations under this
Agreement.
12.2 Subject to the provisions of Articles XIII and XVIII, FRONTIER
hereby releases and agrees to indemnify, defend, protect and hold harmless
QWEST, and its employees, officers and directors, from and against, and assumes
liability for:
(a) Any injury, loss or damage to any person (including QWEST), tangible
property or facilities of any person or entity (including reasonable attorneys'
fees and costs) to the extent arising out of or resulting from the acts or
omissions, negligent or otherwise, of FRONTIER, its officers, employees,
servants, affiliates, agents, contractors, licensees, invitees or vendors
arising out of or in connection with a default (other than a default caused by a
failure of QWEST to perform or comply with its obligations hereunder) by
FRONTIER in the performance of its obligations or breach of its representations
under this Agreement (including, without limitation, any default by FRONTIER in
the performance of its obligations under Article XI with respect to its use of
the QWEST System); and
(b) Any claims, liabilities or damages, including reasonable attorneys'
fees and costs, arising out of any violation by FRONTIER of any regulation,
rule, statute or court order of any local, state or federal governmental agency,
court or body in connection with its use of the IRUs and/or the FRONTIER Fibers
and Associated Property hereunder.
12.3 The parties agree to promptly provide each other with notice of
any lawsuit, judicial, administrative or other dispute resolution action or
proceeding, or claim of which it becomes aware and which it believes may result
in an indemnification obligation hereunder (each, an "Action"); provided that
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the failure to provide any such notice shall not affect the indemnifying party's
indemnification obligation unless the indemnifying party is actually prejudiced
by the failure to receive such notice. After receipt of any such notice, if the
indemnifying party shall acknowledge in writing to the indemnified party that
the indemnifying party shall be obligated under the terms of this indemnity
hereunder in connection with such Action, then the indemnifying party shall be
entitled, if it so elects (i) to take control of the defense and investigation
of such Action, (ii) to employ and engage attorneys of its own choice to handle
and defend the same, at the indemnifying party's cost, risk and expense unless
the named parties to such action or proceeding include both the indemnifying
party and the indemnified party and the indemnified party has been advised in
writing by counsel that there may be one or more legal defenses available to
such indemnified party that are different from or additional to those available
to the indemnifying party, in which case the indemnified party shall also have
the right to employ its own counsel in any such case with the reasonable fees
and expenses of such counsel being borne by the indemnifying party, and (iii) to
compromise or settle such Action, which compromise or settlement shall be made
only with the written consent of the indemnified party, such consent not to be
unreasonably withheld. Notwithstanding anything in this Section 12.3 to the
contrary, (i) if there is a reasonable probability that an indemnifiable claim
may materially adversely affect the indemnified party, other than as a result of
money damages or other money payments, the indemnified party shall have the
right to participate in such defense, compromise or settlement and the
indemnifying party shall not, without the indemnified party's written consent
(which consent shall not be unreasonably withheld), settle or compromise any
indemnifiable claim or consent to entry of any judgment in respect thereof
unless such settlement, compromise or consent includes as an unconditional term
thereof the giving by the claimant or the plaintiff to the indemnified party a
release from all liability in respect of such indemnifiable claim.
12.4 The parties hereby expressly recognize and agree that each
party's said obligation to indemnify, defend, protect and save the other
harmless is not a material obligation to the continuing performance of the
parties' other obligations, if any, hereunder. In the event that a party shall
fail for any reason to so indemnify, defend, protect and save the other
harmless, the injured party hereby expressly recognizes that its sole remedy in
such event shall be the right to bring legal proceedings against the other party
for its damages as a result of the other party's said failure to indemnify,
defend, protect and save harmless. The obligations of the parties under this
Article XII shall survive the expiration or termination of this Agreement.
12.5 Nothing contained herein shall operate as a limitation on the
right of either party hereto to bring an action for damages against any third
party, including indirect, special or consequential damages, based on any acts
or omissions of such third party as such acts or omissions may affect the
construction, operation or use of the FRONTIER Fibers or the QWEST System;
provided, however, that each party hereto shall assign such rights or claims,
execute such documents and do whatever else may be reasonably necessary to
enable the other party to pursue any such action against such third party.
ARTICLE XIII.
LIMITATION OF LIABILITY
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13.1 Notwithstanding any provision of this Agreement to the contrary,
except to the extent caused by its own willful misconduct, neither party shall
be liable to the other party for any special, incidental, indirect, punitive or
consequential damages, whether foreseeable or not, arising out of, or in
connection with such party's failure to perform its respective obligations or
breach of its respective representations hereunder, including, but not limited
to, loss of profits or revenue (whether arising out of transmission
interruptions or problems, any interruption or degradation of service or
otherwise), cost of capital, or claims of customers, in each case whether
occasioned by any construction, reconstruction, relocation, repair or
maintenance performed by, or failed to be performed by, the other party or any
other cause whatsoever, including breach of contract, breach of warranty,
negligence, or strict liability, all claims with respect to which such special,
incidental, indirect, punitive or consequential damages are hereby specifically
waived. Nothing contained herein shall be construed to prohibit or reduce the
payment by QWEST of the amounts described in Section 18.2 and which the parties
acknowledge are the sole rights and remedies of FRONTIER to the extent provided
in Section 18.2(e).
ARTICLE XIV.
INSURANCE
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14.1 During the construction period with respect to any Segment, and
until the Acceptance Date with respect thereto, QWEST shall procure and maintain
in force the following insurance coverage from companies lawfully approved to do
business in the state where the construction will be performed:
(a) not less than $5,000,000 combined single-limit liability insurance, on
an occurrence basis, for personal injury and property damage, including, without
limitation, injury or damage arising from the operation of vehicles or equipment
and liability for completed operations;
(b) workers' compensation insurance in amounts required by applicable law
and employers' liability insurance with a limit of at least $1,000,000 per
occurrence;
(c) automobile liability insurance covering death or injury to any person
or persons, or damage to property arising from the operation of vehicles or
equipment, with limits of not less than $2,000,000 per occurrence; and
(d) any other insurance coverages required pursuant to QWEST's right-of-way
agreements with railroads or other third parties.
QWEST shall require its subcontractors who are engaged in connection with
the construction of the QWEST System 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 its subcontractors to
carry a minimum of $1,000,000 in commercial general liability; and
(e) FRONTIER shall be listed as an additional insured on all policies set
forth above, except workers' compensation. QWEST shall provide to FRONTIER a
certificate of insurance evidencing such insurance coverage. Evidence of
insurance furnished shall contain a clause stating FRONTIER "shall be notified
in writing at least thirty (30) days prior to any cancellation of, or any
material change or new exclusions in the policy."
14.2 Following the Acceptance Date with respect to each Segment, and
throughout the remaining term of the IRU with respect to such Segment, each
party shall procure and maintain in force, at its own expense:
(a) not less than $5,000,000 combined single limit liability insurance, on
an occurrence basis, for personal injury and property damage, including, without
limitation, injury or damage arising from the operation of vehicles or equipment
and liability for completed operations;
(b) workers' compensation insurance in amounts required by applicable law
and employers' liability insurance with a limit of at least $1,000,000 per
occurrence;
(c) automobile liability insurance covering death or injury to any person
or persons, or damage to property arising from the operation of vehicles or
equipment, with limits of not less than $2,000,000 per occurrence; and
(d) any other insurance coverages specifically required of such party
pursuant to QWEST's right-of-way agreements with railroads or other third
parties.
14.3 Both parties expressly acknowledge that a party shall be deemed
to be in compliance with the provisions of this Article if it maintains an
approved self insurance program providing for a retention of up to $1,000,000.
If either party provides any of the foregoing coverages on a claims-made basis,
such policy or policies shall be for at least a three-year extended reporting or
discovery period. Unless otherwise agreed, FRONTIER's and QWEST's insurance
policies shall be obtained and maintained with companies rated "A" or better by
Best's Key Rating Guide and each party shall provide the other with an insurance
certificate confirming compliance with this requirement for each policy
providing such required coverage.
14.4 In the event either party fails to obtain the required insurance
or to obtain the required certificates from any contractor and a claim is made
or suffered, such party shall indemnify and hold harmless the other party from
any and all claims for which the required insurance would have provided
coverage. Further, in the event of any such failure which continues after seven
(7) days' written notice thereof by the other party, such other party may, but
shall not be obligated to, obtain such insurance and will have the right to be
reimbursed for the cost of such insurance by the party failing to obtain such
insurance.
14.5 In the event coverage is denied or reimbursement of a properly
presented claim is disputed by the carrier for insurance provided above, the
party carrying such coverage shall make good-faith efforts to pursue such claim
with its carrier.
14.6 FRONTIER and QWEST shall each obtain from the insurance companies
providing the coverages required by this Agreement the permission of such
insurers to allow such party to waive all rights of subrogation and such party
does hereby waive all rights of said insurance companies to subrogation against
the other party, its parent corporation, affiliates, subsidiaries, assignees,
officers, directors, and employees or any other party entitled to indemnity
under this Agreement.
ARTICLE XV.
TAXES, FEES AND OTHER GOVERNMENTAL IMPOSITIONS
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15.1 The parties acknowledge and agree that it is their mutual
objective and intent to (i) minimize, to the extent feasible, the aggregate
Impositions (as defined in Section 33.1(e)) payable with respect to the QWEST
System and (ii) share such Impositions according to their respective interests
in the QWEST System , and that they will cooperate with each other and
coordinate their mutual efforts to achieve such objectives in accordance with
the provisions of this Article XV.
15.2 QWEST shall be responsible for and shall timely pay any and all
Impositions with respect to the construction or operation of the QWEST System
which Impositions are (i) imposed or assessed prior to the Acceptance Date, (ii)
imposed or assessed with respect to events which occurred or property rights or
obligations of QWEST which existed prior to the acceptance date; or (iii)
imposed or assessed (regardless of the time) with respect to the QWEST System in
exchange for the approval of construction in the original agreement which
resulted in the granting of an Underlying Right. Notwithstanding the foregoing
obligations, QWEST shall have the right to challenge any such Impositions so
long as the challenge of such Impositions does not materially, adversely affect
the title, rights or property to be delivered to FRONTIER pursuant hereto.
15.3 Except as to Impositions described in paragraphs (ii) and (iii)
of Section 15.2, following the Acceptance Date, QWEST shall timely pay any and
all Impositions imposed upon or with respect to the QWEST System to the extent
such Impositions may not feasibly be
separately assessed or imposed upon or against the respective ownership
interests of QWEST and FRONTIER in the QWEST System; provided that, upon receipt
of a notice of any such Imposition, QWEST shall promptly notify FRONTIER of such
Imposition and following payment of such Imposition by QWEST, FRONTIER shall
promptly reimburse QWEST for its proportionate share of such Imposition, which
share shall be determined (i) to the extent possible, based upon the manner and
methodology used by the particular authority imposing such Impositions (e.g., on
the cost of the relative property interests, historic or projected revenue
derived therefrom, or any combination thereof) and, if based upon projected
revenue or gross receipts, then based on the relative number of FRONTIER Fibers
in the affected portion of the QWEST System compared to the total number of
fibers in the affected portion of the QWEST System during the relevant tax
period which are subject to an indefeasible right of use or are otherwise in
use; or (ii) if the same cannot be so determined, then based upon FRONTIER's
proportionate share of the total fiber count in the affected portion of the
QWEST System. QWEST shall provide FRONTIER with reasonable supporting
documentation for Impositions for which QWEST seeks reimbursement. If QWEST's
assessed value, for property tax purposes, is based on its entire operation in
any state (i.e., central assessment), QWEST and FRONTIER shall work together in
good faith to allocate a proper portion of said assessment to the QWEST System
and FRONTIER's ownership interest in the QWEST System. Any reimbursement made
under this Section 15.3 shall be in an amount equal to the Impositions required
to be paid by QWEST in respect of the receipt or accrual of such reimbursement
less the net present value (computed at a 10% discount rate) of the tax benefit
(e.g. from the deduction, depreciation or amortization of such payment or
accrual of the Imposition) to which QWEST may be entitled with respect to the
payment or accrual of the Impositions which have been reimbursed. Hereafter,
such additional amount or amounts shall be referred to as the "Gross-up Amount."
Such Gross-up Amount shall not include any tax on the amount of the Gross-up
Amount itself. QWEST shall, upon request, provide FRONTIER with documentation
in support of any Gross-up Amount so as to ensure that both parties are made
whole in a manner that is consistent with the mutual objectives set forth in
section 15.1 of the Agreement. If such Gross-up Amount exceeds $50,000,
FRONTIER may elect to engage the services of an independent consultant, at
FRONTIER's sole cost and expense, to review QWEST's computation of such Gross-up
Amount. Any independent consultant selected by FRONTIER shall be subject to
approval by QWEST, which such approval shall not be unreasonably withheld, and
such independent consultant shall be subject to confidentiality restrictions as
may be determined in QWEST's sole discretion. Further, if, after review of such
documentation or otherwise, in the event the parties are unable to agree upon
the amount of the Gross-up Amount, such dispute shall be resolved pursuant to
Article XXI of the Agreement.
15.4 Upon notice of the assertion or proposed assertion of any
imposition described in Section 15.3 (including Impositions that trigger a
Gross-up Amount) QWEST shall promptly and in good faith consult with FRONTIER
concerning the underlying facts and whether to contest or continue to contest
such assertion or proposed assertion. Notwithstanding any provision herein to
the contrary, QWEST shall have the right to contest any Imposition described in
Section 15.3, above, (including Impositions which trigger a Gross-up Amount).
Such contest may be pursued by any lawful means including by non-payment of such
Imposition provided such non-payment
does not materially, adversely affect the title, rights or property to be
delivered to FRONTIER pursuant hereto). The out-of-pocket costs and expenses
(including reasonable attorneys' fees) incurred by QWEST in any such contest
shall be shared by QWEST and FRONTIER in the same proportion as to which the
parties shared in any such Imposition, as it was originally assessed. Any
refunds or credits resulting from a contest brought pursuant to this Section
15.4 shall be divided between QWEST and FRONTIER in the same proportion as to
which such refunded or credited Impositions were borne by QWEST and FRONTIER.
In any such event, QWEST shall provide timely notice of such challenge to
FRONTIER. If QWEST chooses to proceed with such challenge after receipt of a
written objection to the challenge from FRONTIER, QWEST shall conduct such
challenge at its own costs and expense, provided that FRONTIER shall not receive
the benefit of any refund or credit, if any, obtained as a result of a
successful challenge. Further, where QWEST does not contest an Imposition,
FRONTIER shall have the right, after notice to QWEST, to contest such Imposition
as long as such contest does not materially, adversely affect the title property
or rights of QWEST. The out-of-pocket costs and expenses (including reasonable
attorney's fees) incurred by FRONTIER in any such contest shall be shared by
FRONTIER and QWEST in the same proportion as to which the parties shared in such
Imposition, as it was originally assessed. Any refunds or credits resulting
from a contest shall be divided between FRONTIER and QWEST in the same
proportion as to which such refunded or credited Imposition was borne by
FRONTIER and QWEST. If FRONTIER chooses to proceed with such contest after
receipt of written objection to the challenge from QWEST, FRONTIER shall conduct
such challenge at its own costs and expense, provided that QWEST shall not
receive the benefit of any refund or credit, if any, obtained as a result of a
successful challenge. Provided, however, that notwithstanding anything to the
contrary in this Article 15, QWEST shall have complete authority over and
discretion to control (including the authority to dismiss or not pursue) any
contests relating to Impositions based upon the computation of QWEST's taxable
income under the Federal Internal Revenue Code or state income or franchise tax
laws (hereinafter "Net Income Based Impositions"). FRONTIER shall, however, be
consulted on the conduct and status of such contest. QWEST shall have no
obligation to disclose to FRONTIER its income or franchise tax returns and
records except as to the discrete portion of such return or record that directly
relates to the computation and payment of such Net Income Based Impositions.
Provided further, however, that in the event QWEST shall determine in its own
discretion not to pursue a contest of any Net Income Based Imposition as to
which FRONTIER has requested a contest pursuant to the provisions described
above in this Section 15.4, then FRONTIER shall have no obligation to provide
any reimbursement for such amount if FRONTIER shall have obtained and provided
to QWEST an opinion of nationally recognized legal counsel confirming that a
meritorious defense exists to such Net Income Based Imposition.
15.5 Except as to Impositions described in paragraph (iii) of Section
15.2, following the Acceptance Date QWEST and FRONTIER, respectively, shall be
separately responsible for any and all Impositions (i) expressly or implicitly
imposed upon, based upon, or otherwise measured by the gross receipts, gross
income, net receipts or net income received by or accrued to such party due to
its respective ownership or use of the QWEST System and/or the
FRONTIER Fibers, or (ii) which have been separately assessed or imposed upon the
respective ownership interest of such party in the QWEST System and/or the
FRONTIER Fibers. If the FRONTIER Fibers are the only fibers located in the
Cable from the point where the Cable leaves the QWEST System right-of-way to a
FRONTIER POP, FRONTIER shall be solely responsible for any and all Impositions
imposed on or with respect to such portion of the QWEST System.
15.6 Notwithstanding any provision herein to the contrary, FRONTIER
shall have the right to protest by appropriate proceedings any Imposition
described in Section 15.5, above. In such event, FRONTIER shall indemnify and
hold QWEST harmless from any expense, legal action or cost, including reasonable
attorneys' fees, resulting from FRONTIER's exercise of its rights hereunder. In
the event of any refund, rebate, reduction or abatement to FRONTIER of any such
Imposition imposed upon and/or paid by FRONTIER, FRONTIER shall be entitled to
receive the entire benefit of such refund, rebate, reduction or abatement
attributable to FRONTIER's use of the QWEST System. In the event FRONTIER has
exhausted all its rights of appeal in protesting any Imposition and has failed
to obtain the relief sought in such proceedings or appeals ("Finally Determined
Taxes and Fees"), FRONTIER and QWEST may jointly agree (with the consent and
participation of the other Interest Holders in the affected portion of the QWEST
System) to relocate a portion of the QWEST System so as to bypass the
jurisdiction which had imposed or assessed such Finally Determined Taxes and
Fees with the total Costs thereof to be shared proportionately as follows: (i)
if the affected portion of the QWEST System includes any conduit other than the
conduit in which the FRONTIER Fibers are located, the total Costs of relocation
of the conduits (i.e., relocation of the conduits only without regard to whether
the conduits contain fibers) shall be allocated based on the overall number of
conduits in the QWEST System which are relocated; and (ii) such Costs allocated
to the conduit carrying the FRONTIER Fibers plus the Costs specifically
associated with the relocation of the fiber (i.e., relocation of the fiber only
without regard to relocation of conduit) to be further allocated to FRONTIER
based upon FRONTIER's proportionate share of (A) all Costs of fiber
acquisitions, splicing and testing, prorated based on the total fiber count in
the Cable, as so relocated; and (B) all other Costs associated with the
relocation of the conduit housing the affected Cable, prorated based upon the
total number of Interest Holders in the affected Cable, as so relocated. QWEST
shall deliver to FRONTIER updated As-Builts with respect to the relocated QWEST
System not later than sixty (60) days following the completion of such
relocation. If FRONTIER and QWEST do not determine to relocate the affected
portion of the QWEST System, FRONTIER shall have the right to terminate its use
of the FRONTIER Fibers in the affected portion of the QWEST System. Such
termination shall be effective on the date specified by FRONTIER in a notice of
termination, which date shall be at least ninety (90) days after the notice.
Upon such termination, the IRU in the affected portion of the QWEST System shall
immediately terminate, and the FRONTIER Fibers in the affected portion of the
QWEST System shall thereupon revert to QWEST without reimbursement of any of the
IRU Fee or other payments previously made with respect thereto.
15.7 Notwithstanding the provisions of Section 15.6, with respect to
any Impositions relating to the QWEST System which are imposed upon both QWEST
and FRONTIER (or both
of their respective interests therein), QWEST, at its option and at its own
expense, shall have the right to direct and manage any such contest; subject,
however, to reasonable and appropriate consultation with FRONTIER which hereby
agrees to cooperate with QWEST in any such contest. The right of QWEST to
contest any Imposition pursuant to this Section 15.7 shall be contingent upon
reasonable and appropriate assurances that any such contest will not adversely
affect the title, property or rights of FRONTIER hereunder.
15.8 QWEST and FRONTIER agree to cooperate fully in the preparation of
any returns or reports relating to the Impositions. QWEST and FRONTIER further
acknowledge and agree that the provisions of this Article XV are intended to
allocate the Impositions expected to be assessed against or imposed upon the
parties with respect to the QWEST System based upon the procedures and methods
of computation by which Impositions generally have been assessed and imposed to
date, and that material changes in the procedures and methods of computation by
which such assessments are assessed and imposed could significantly alter the
fundamental economic assumptions underlying the transactions hereunder to the
parties. Accordingly, the parties agree that, if in the future the procedures or
methods of computation by which Impositions are assessed or imposed against the
parties change materially from the procedures or methods of computation by which
they are imposed as of the date hereof, the parties will negotiate in good faith
an amendment to the provisions of this Article XV in order to preserve, to the
extent reasonably possible, the economic intent and effect of this Article XV as
of the date hereof.
ARTICLE XVI.
NOTICE
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16.1 Unless otherwise provided herein, all notices and communications
concerning this Agreement shall be addressed to the other party as follows:
If to QWEST: QWEST Communications Corporation
ATTENTION: President
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▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: QWEST Communications Corporation
ATTENTION: General Counsel
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▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
and a copy to: ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, Esq.
Holme ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
1700 Lincoln, Suite 4100
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Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to FRONTIER: FRONTIER Communications International Inc.
ATTENTION: Director, Network Development
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▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: Frontier Corporation
ATTENTION: Vice President,
Network Planning and Development
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▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
and a copy to: Frontier Corporation
ATTENTION: Vice President,
Legal and Regulation
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▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as either party may designated from time to time in
writing to the other party.
16.2 Unless otherwise provided herein, notices shall be hand
delivered, sent by registered or certified U.S. mail, postage prepaid, or by
commercial overnight delivery service, or transmitted by facsimile, and shall be
deemed served or delivered to the addressee or its office when received at the
address for notice specified above when hand delivered, upon confirmation of
sending when sent by fax, on the day after being sent when sent by overnight
delivery service, or three (3) days after deposit in the mail when sent by U.S.
mail.
16.3 All invoices concerning payment obligations due to QWEST pursuant
to this Agreement shall be addressed to FRONTIER as follows:
Frontier Corporation
ATTENTION: Treasurer
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▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: Frontier Corporation
ATTENTION: Director, Network Development
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▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
ARTICLE XVII.
CONFIDENTIALITY
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17.1 QWEST and FRONTIER hereby agree that if either party provides
(or, prior to the execution hereof, has provided) confidential or proprietary
information to the other party ("Proprietary Information"), such Proprietary
Information shall be held in confidence, and the receiving party shall afford
such Proprietary Information the same care and protection as it affords
generally to its own confidential and proprietary information (which in any case
shall be not less than reasonable care) in order to avoid disclosure to or
unauthorized use by any third party. The parties acknowledge and agree that
this Agreement, including all of the terms, conditions and provisions hereof,
and all drafts hereof, constitutes Proprietary Information. In addition, all
information disclosed by either party to the other in connection with or
pursuant to this Agreement, including prior to the date hereof, shall be deemed
to be Proprietary Information. All Proprietary Information, unless otherwise
specified in writing, shall remain the property of the disclosing party, shall
be used by the receiving party only for the intended purpose, and such written
Proprietary Information, including all copies thereof, shall be returned to the
disclosing party or destroyed after the receiving party's need for it has
expired or upon the request of the disclosing party. Proprietary Information
shall not be reproduced except to the extent necessary to accomplish the purpose
and intent of this Agreement, or as otherwise may be permitted in writing by the
disclosing party.
17.2 The foregoing provisions of Section 17.1 shall not apply to any
Proprietary Information which (i) becomes publicly available other than through
the recipient; (ii) is required to be disclosed by a governmental or judicial
law, order, rule or regulation; (iii) is independently developed by the
disclosing party; (iv) becomes available to the disclosing party without
restriction from a third party; or (v) becomes relevant to the settlement of any
dispute or enforcement of either party's rights under this Agreement in
accordance with the provisions of
this Agreement, in which case appropriate protective measures shall be taken to
preserve the confidentiality of such Proprietary Information as fully as
possible within the confines of such settlement or enforcement process. If any
Proprietary Information is required to be disclosed pursuant to the foregoing
clause (ii), the party required to make such disclosure shall promptly inform
the other party of the requirements of such disclosure.
17.3 Notwithstanding Sections 17.1 and 17.2 of this Article, either
party may disclose Proprietary Information to its employees, agents, and legal,
financial, and accounting advisors and providers (including its lenders and
other financiers) to the extent necessary or appropriate in connection with the
negotiation and/or performance of this Agreement or its obtaining of financing,
provided that each such party is notified of the confidential and proprietary
- -------------
nature of such Proprietary Information and is subject to or agrees to be bound
by similar restrictions on its use and disclosure. In addition, notwithstanding
Sections 17.1 and 17.2 of this Article, FRONTIER may disclose this Agreement and
its terms, conditions and provisions to the Permitted System Acquiror and/or the
Permitted Sacramento/Seattle Acquiror (each as defined in Section 25.3(b)),
provided that (i) such Permitted System Acquiror and/or Permitted
- -------------
Sacramento/Seattle Acquiror, prior to any such disclosure, shall have been
notified of the confidential and proprietary nature of this Agreement and its
terms, conditions and provisions and shall have entered into a written
confidentiality agreement with substantially similar (and in no event less
restrictive than the) terms of the Confidentiality Agreement between QWEST and
FRONTIER dated February 15, 1995, (ii) copies of all or any portion of this
Agreement (including Exhibits) may not be furnished to the Permitted System
Acquiror and/or the Permitted Sacramento/Seattle Acquiror without the prior
written consent of QWEST (not unreasonably withheld or delayed) of the proposed
form of disclosure thereof (redacted or otherwise), and (iii) copies of all or
any portion of any Underlying Right may not be furnished without the prior
written consent of QWEST (not unreasonably withheld or delayed).
17.4 The provisions of this Article XVII shall survive expiration or
termination of this Agreement.
ARTICLE XVIII.
DEFAULT
-------
18.1 With respect to all payments required to be made by FRONTIER
hereunder, including, without limitation, payment of the IRU Fee and all other
amounts payable by FRONTIER hereunder, in the event FRONTIER shall fail to make
a payment by the date due and payable hereunder, from and after such date, (i)
such unpaid amount shall bear interest until paid at a rate equal to the rate
set forth in Article XXX and (ii) if such payment is due with respect to a
Segment on or prior to the Acceptance Date of such Segment, the Estimated
Delivery Date for such Segment shall be extended by a number of days equal to
the number of days that elapse from the date such payment is due until paid. In
the event any amount or amounts due and payable hereunder remain unpaid for a
period of eighty (80) days after written notice from QWEST to FRONTIER, and the
amount thereof is not in bona fide dispute, then QWEST may,
in its sole and absolute discretion and in addition to its other rights and
remedies hereunder, after ten (10) days prior written notice to FRONTIER and the
failure of FRONTIER to pay such amount within such ten-day period, terminate any
and all of its obligations hereunder with respect to any Segment or Segments as
to which the Acceptance Date has not yet occurred or the grant of the IRU with
respect to which has not yet become effective, and to apply any and all amounts
previously paid by FRONTIER hereunder with respect to such Segment or Segments
toward the payment of any other amounts then or thereafter payable by FRONTIER
hereunder. With respect to all of its other obligations hereunder, in the event
FRONTIER shall fail to perform a non-payment obligation and such failure shall
continue for a period of thirty (30) days after QWEST shall have given FRONTIER
written notice of such failure, FRONTIER shall be in default hereunder unless
FRONTIER shall have cured such failure or such failure is otherwise waived in
writing by QWEST within such thirty (30) days; provided, however, that where
-----------------
such failure cannot reasonably be cured within such 30-day period, if FRONTIER
shall proceed promptly to cure the same and prosecute such cure with due
diligence, the time for curing such failure shall be extended for such period of
time as may be necessary to complete such cure; and provided further that if
----------------
FRONTIER certifies in good faith to QWEST in writing that a non-payment failure
has been cured, such failure shall be deemed to be cured unless QWEST otherwise
notifies FRONTIER in writing within fifteen (15) days of receipt of such notice
from FRONTIER. FRONTIER shall be in default hereunder (i) automatically upon
the making by FRONTIER or Frontier Corporation of a general assignment for the
benefit of its creditors, the filing by FRONTIER or Frontier Corporation of a
voluntary petition in bankruptcy or the filing by FRONTIER or Frontier
Corporation of any petition or answer seeking, consenting to, or acquiescing in
reorganization, arrangement, adjustment, composition, liquidation, dissolution,
or similar relief; (ii) one hundred twenty (120) days after the filing of an
involuntary petition in bankruptcy or other insolvency protection against
FRONTIER or Frontier Corporation which is not dismissed within such one hundred
twenty (120) days, or (iii) upon any default by Frontier Corporation under the
Guaranty, which default is not cured within the relevant cure period, if any,
provided with respect thereto under the Guaranty. Except as otherwise provided
in this Section 18.1, upon any default by FRONTIER, after written notice thereof
from QWEST, QWEST may (i) take such action as it determines, in its sole
discretion, to be necessary to correct the default and, subject to Section 13.1,
recover from FRONTIER its reasonable costs incurred in correcting such default,
and (ii) pursue any legal remedies it may have under applicable law or
principles of equity relating to such default, including specific performance.
Notwithstanding any other provision of this Agreement, QWEST acknowledges and
agrees that QWEST shall have no right to terminate the IRU or any of the rights
and interests of FRONTIER hereunder with respect to any Segment for which the
IRU Fee relating thereto has been fully paid.
18.2 (a) With respect to its obligation to complete the construction,
installation, and satisfactory Fiber Acceptance Testing of the FRONTIER Fibers
comprising a particular Segment by the Estimated Delivery Date with respect to
such Segment pursuant to Section 3.2, the parties acknowledge and agree that it
is in their mutual best interest to work together in a cooperative effort to
determine whether and to what extent any event or occurrence that is reasonably
likely to cause a delay in the delivery of a Segment hereunder, as a result of
any force
majeure event or other occurrence described in Article XX or otherwise, can be
terminated, resolved or avoided, and to cause the construction, installation and
delivery of the Segment to be completed in the most expeditious and practical
manner feasible under the circumstances. Accordingly, within three (3) months
following its discovery of an event or occurrence that QWEST reasonably believes
is likely to cause (i) an extension of the Estimated Delivery Date of one
hundred twenty (120) days or more pursuant to Article XX or (ii) a Delivery
Default (as defined pursuant to Section 18.2(d) below), QWEST shall give written
notice to FRONTIER of such event or occurrence. Thereupon, each of QWEST and
FRONTIER (i) will designate a senior executive officer with decision-making
authority and familiarity with this Agreement and the relevant issue hereunder,
and (ii) may designate one technical representative and one financial
representative, to participate in the following resolution efforts. Each of
such designees shall participate in such meetings, promptly scheduled at
mutually agreed upon times and places, as may be necessary or appropriate to
discuss in good faith the status of construction of the affected Segment, the
reason or reasons for the anticipated Estimated Delivery Date extension or
Delivery Default, various possible and practical means by which the event(s) or
occurrence(s) causing such anticipated Estimated Delivery Date extension or
Delivery Default might be terminated, avoided or resolved, including, without
limitation, possible modifications to the route, selection of right-of-way, or
manner of construction of the affected Segment, and (iii) use their best efforts
to settle upon and implement a procedure by which such event(s) or occurrence(s)
may be terminated, avoided or resolved and the construction, installation and
delivery of the affected Segment completed in an expeditious and economically
practical and feasible manner under the circumstances. The parties acknowledge
and agree that, because the QWEST System includes or will include other
participants, including owners and holders of Dark Fiber IRUs and
telecommunication system operations, such meetings may, and likely will, involve
designees and representatives of such other participants, and the resolution of
any matters so acted upon will require the cooperative efforts of, and have to
be structured, to the extent feasible, in an effort to meet the needs of all
such participants. The parties hereto further acknowledge and agree that no
failure of the parties hereto to resolve, or to agree upon a manner in which
they might resolve, any issue addressed hereunder shall impair, adversely affect
or invalidate any of their respective rights, claims or remedies under this
Agreement.
(b) If, notwithstanding the efforts of the parties pursuant to Section
18.2(a):
(i) (A) a force majeure event or occurrence described in Article XX
causing an anticipated Estimated Delivery Date extension has not been
terminated, avoided or resolved by the date that is twelve (12) months following
QWEST's discovery of such event or occurrence, and
(B) there is no "Reasonably Apparent Probability" (either as mutually
determined by QWEST and FRONTIER or, if QWEST and FRONTIER are unable to make
such a mutual determination, as determined by an independent third party
mutually selected by QWEST and FRONTIER and familiar with large-scale fiberoptic
system constructions projects or, if QWEST and FRONTIER are unable to make such
a mutual selection, each of QWEST and
FRONTIER shall designate such an independent third party, the two of which shall
designate such an independent third party to make such determination) that the
Acceptance Date with respect to any such affected Segment will occur within (1)
twelve (12) months following the Estimated Delivery Date (without extension for
any delay pursuant to Article XX) with respect to any Segment designated as a
"priority" Segment on Exhibit A-1, or (2) eighteen (18) months following the
Estimated Delivery Date (without extension for any delay pursuant to Article XX)
with respect to any other Segment (such date with respect to each Segment being
referred to as the "Outside Force Majeure Date"); or
(ii) notwithstanding a determination pursuant to the foregoing clause (i)
that there was a Reasonably Apparent Probability that the Acceptance Date with
respect to the affected Segment would occur by the applicable Outside Force
Majeure Date, nonetheless the event or occurrence described in Article XX
causing such delay is continuing on such applicable Outside Force Majeure Date;
or
(iii) notwithstanding such a determination that there was a Reasonably
Apparent Probability that the Acceptance Date with respect to the affected
Segment would occur by the applicable Outside Force Majeure Date, nonetheless,
on the applicable Outside Force Majeure Date, although the event or occurrence
described in Article XX has been terminated, avoided or resolved and QWEST has
resumed its construction, installation, splicing, and/or testing efforts, QWEST
is unable to demonstrate to FRONTIER's reasonable satisfaction that the
Acceptance Date for such Segment will occur, in all reasonable probability, by
the date that is six (6) months following such Outside Force Majeure Date,
then, in any such event described in foregoing clauses (i), (ii), and (iii),
FRONTIER may elect, in its sole discretion, by written notice to QWEST, to
delete such Segment from the System Route otherwise to be delivered pursuant to
this Agreement, and recover from QWEST (1) the amount of the IRU Fee previously
paid by FRONTIER hereunder with respect to such Segment, plus (2) interest at
the prime rate interest published by The Wall Street Journal as the base rate on
-----------------------
corporate loans posted by a substantial percentage of the nation's largest banks
on such date, plus (3) an amount equal to ten percent (10%) of the IRU Fee for
such Segment, as determined or redetermined pursuant to Section 2.1 (with such
aggregate amount payable to FRONTIER promptly following QWEST's receipt of such
election notice or, at the election of FRONTIER, offset against the unpaid
amount of the IRU Fee payable hereunder with respect to any other Segment or
Segments). Upon any such election and payment (or offset), neither party shall
have any further rights or obligations with respect to such Segment hereunder.
(c) If, notwithstanding the efforts of the parties pursuant to Section
18.2(a):
(i) (A) an event or occurrence causing an anticipated Delivery Default
(as defined in Section 18.2(d) below) has not been terminated, avoided, resolved
or waived by the date that is twelve (12) months following QWEST's discovery of
such event or occurrence; and
(B) there is no Reasonably Apparent Probability that the Acceptance Date
with respect to any such affected Segment will occur within (x) twelve (12)
months following the Estimated Delivery Date with respect to each Segment
designated as a "priority" Segment on Exhibit A-1, or (y) eighteen (18) months
following the Estimated Delivery Date with respect to any other Segment (such
dates being referred to collectively as the "Outside Delivery Default Date"); or
(ii) notwithstanding a determination pursuant to the foregoing clause (i)
that there was a Reasonably Apparent Probability that the Acceptance Date with
respect to the affected Segment would occur by the applicable Outside Delivery
Default Date, nonetheless, on the applicable Outside Delivery Default Date, the
Acceptance Date for such Segment has not occurred;
then, in any such event described in the foregoing clauses (i) and (ii),
FRONTIER may elect, in its sole discretion, by written notice to QWEST, to
delete such Segment from the System Route otherwise to be delivered pursuant to
this Agreement, and recover from QWEST (1) the amount of the IRU Fee previously
paid by FRONTIER hereunder with respect to such Segment, plus (2) interest
thereon at the rate of interest applicable to late payments set forth in Article
XXX, plus (3) an amount equal to
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
) of the IRU Fee for such
Segment, as determined or redetermined pursuant to Section 2.1, but without
reduction of such IRU fee under Section 18.2(d) (with such aggregate amount
payable to FRONTIER promptly following QWEST's receipt of such election notice
or, at the election of FRONTIER, offset against the unpaid amount of the IRU Fee
payable hereunder with respect to any other Segment or Segments). Upon any such
election and payment (or offset), neither party shall have any further rights or
obligations with respect to such Segment hereunder.
(d) In addition to the specific rights and remedies provided pursuant to
the foregoing paragraphs (b) and (c) in connection with delays and anticipated
delays in the delivery of Segments hereunder, QWEST shall be in default under
this Agreement if the Acceptance Date with respect to any Segment has not
occurred within one hundred twenty (120) days after the Estimated Delivery Date
(a "Delivery Default"). From the date of any such Delivery Default, and until
the Acceptance Date with respect to such Segment occurs, the IRU Fee with
respect to such Segment, as determined or redetermined pursuant to Section 2.1
hereof, shall be reduced by an amount equal to
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% of such IRU Fee for each
thirty (30) days (or a pro rata percentage of
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% for any period of less than
thirty (30) days) that elapse between such date of Delivery Default and the
Acceptance Date.
(e) The rights and remedies set forth in the foregoing Sections 18.2(c) and
18.2(d) shall be the sole remedies available to FRONTIER with respect to any
failure by QWEST to construct, install, and conduct satisfactory Fiber
Acceptance Testing with respect to the FRONTIER Fibers comprising any Segment by
the relevant Estimated Delivery Date (it being expressly acknowledged and agreed
that the rights provided to FRONTIER pursuant to
Section 18.2(b) are provided only as an accommodation in the event of lengthy
force majeure delays pursuant to Article XX, and that the events described in
Section 18.2(b) do not constitute defaults hereunder). With respect to all of
QWEST's other obligations hereunder, in the event that QWEST shall fail to
perform an obligation and such failure shall continue for a period of thirty
(30) days after FRONTIER shall have given QWEST written notice of such failure,
QWEST shall be in default hereunder unless QWEST shall have cured such failure
or such failure is otherwise waived in writing by FRONTIER within such thirty
(30) days; provided however, that where such failure cannot reasonably be cured
----------------
within such 30-day period, if QWEST shall proceed promptly to cure the same and
prosecute such cure with due diligence, the time for curing such failure shall
be extended for such period of time as may be necessary to complete such cure;
and provided further, that if QWEST certifies in good faith to FRONTIER in
----------------
writing that failure has been cured, such failure shall be deemed to be cured
unless FRONTIER otherwise notifies QWEST in writing within fifteen (15) days of
receipt of such notice from QWEST. QWEST shall be in default hereunder
automatically upon the making by QWEST of a general assignment for the benefit
of its creditors, the filing by QWEST of a voluntary petition in bankruptcy or
the filing by QWEST of any petition or answer seeking, consenting to, or
acquiescing in reorganization, arrangement, adjustment, composition,
liquidation, dissolution, or similar relief, or (ii) one hundred twenty (120)
days after the involuntary filing of a petition in bankruptcy or other
insolvency protection against QWEST which is not dismissed within such 120-day
period. Except as otherwise provided in this Section 18.2, upon any default by
QWEST, after notice thereof from FRONTIER, FRONTIER may (i) take such action as
it determines, in its sole discretion, to be necessary to correct the default,
and, subject to Section 13.1, recover from QWEST its reasonable costs in
correcting such default, and (ii) pursue any legal remedies it may have under
applicable law or principles of equity relating to such default including
specific performance.
ARTICLE XIX.
TERMINATION
-----------
19.1 This Agreement automatically shall terminate with respect to a
Segment upon the expiration or termination of the Term of the IRU respecting
such Segment pursuant to Article VI or Section 18.2 hereof.
19.2 Upon the expiration or termination of this Agreement with respect
to a Segment, the IRU in such Segment shall immediately terminate and all rights
of FRONTIER to use the QWEST System, the FRONTIER Fibers, the Associated
Property or any part thereof relating to such Segment, shall cease and QWEST
shall owe FRONTIER no additional duties or consideration with respect to such
Segment. Promptly thereupon, FRONTIER shall remove all of FRONTIER's
electronics, equipment, separate Regeneration Facilities (as provided pursuant
to Section 7.2) and other associated FRONTIER property from such Segment and any
related QWEST facilities at its sole cost under QWEST's supervision (which
supervision shall be without cost to FRONTIER).
19.3 Notwithstanding the foregoing, no termination or expiration of
this Agreement shall affect the rights or obligations of any party hereto (i)
with respect to any then existing defaults or the obligation to make any payment
hereunder for services rendered prior to the date of termination or expiration
or (ii) pursuant to Article XII, Article XIII, Article XV or Article XVII
herein, which shall survive the expiration or termination hereof.
ARTICLE XX.
FORCE MAJEURE
-------------
20.1 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 shall be excused and
extended for and during the period of any such delay: act of God; fire; flood;
fiber, Cable, or other material failures, shortages or unavailability or other
delay in delivery not resulting from the responsible party's failure to timely
place orders therefor (it being expressly acknowledged that the Cable that is
being acquired for and installed in the QWEST System and that will include the
FRONTIER Fibers must include higher fiber counts than that necessary solely for
the FRONTIER Fibers in order to permit completion of the entire QWEST System);
lack of or delay in transportation; government codes, ordinances, laws, rules,
regulations or restrictions (collectively, "Regulations"); war or civil
disorder; strikes or other labor disputes; failure of a third party to grant or
recognize an Underlying Right, or any other cause beyond the reasonable control
of such party; provided that any delay caused by the failure of a third party to
-------------
grant an Underlying Right shall constitute a force majeure delay hereunder only
to the extent that such delay does not extend beyond a period of six months
(such that the Estimated Delivery Date with respect to any Segment affected by
such delay shall be extended only up to a period of six months of any such
delay, and shall not be further extended if such delay extends beyond a period
of six months). 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.
ARTICLE XXI
DISPUTE RESOLUTION
------------------
21.1 Except as provided in Sections 18.1 and 18.2, if the parties are
unable to resolve any disagreement or dispute arising under or related to this
Agreement, including without limitation, the failure to agree upon any item
requiring a mutual agreement of the parties hereunder, they shall resolve the
disagreement or dispute as follows:
(a) Officers. Either party may refer the matter to the Chief Executive
--------
Officers or the Chief Operating Officers (the "Officers") of the parties by
giving the other party written notice (a "Notice"). Within fifteen (15) days
after delivery of a Notice, the Officers of both parties shall meet at a
mutually acceptable time and place to exchange relevant information and to
attempt to resolve the dispute.
(b) Negotiation. If the matter has not been resolved within thirty (30)
-----------
days after delivery of such Notice, or if the Officers fail to meet within
fifteen (15) days after delivery of such Notice, either party may initiate
mediation and, if applicable, arbitration in accordance with the procedure set
forth in subsections (c) and (d) below. All negotiations conducted by the
Officers pursuant to this clause are confidential and shall be treated as
compromise and settlement negotiations for purposes of the Federal Rules of
Evidence and State Rules of Evidence.
(c) Mediation. In the event a dispute exists between the parties and the
---------
respective Officers are unable to resolve the dispute, the parties agree to
participate in a non-binding mediation procedure as follows:
(i) A mediator will be selected by having counsel for each party agree on a
single person to act as mediator. The parties' counsel as well as the Officers
of each party and not more than two other participants from each party will
appear before the mediator at a time and place determined by the mediator, but
not more than sixty (60) days after delivery of a Notice. The fees of the
mediator and other costs of mediation will be shared equally by the parties.
(ii) Each party's counsel will have forty-five (45) minutes to present a
review of the issue and argument before the mediator. After each counsel's
presentation, the other counsel may present specific counter-arguments not to
exceed ten (10) minutes. The 45-minute and 10-minute periods will be exclusive
of the time required to answer questions from the mediator or attendees.
(iii) After both presentations, the Officers may ask questions of the other
side. At the conclusion of both presentations and the question periods, the
Officers and their counsels will meet together to attempt to resolve the
dispute. The length of the meeting will be as agreed between the parties. Either
party may abandon the procedure at the end of the presentations and question
periods if they feel it is not productive to go further. The mediation procedure
is not binding on either party.
(iv) The duties of the mediator are to be sure that the above set-out time
periods are adhered to and to ask questions so as to clarify the issues and
understandings of the parties. The mediator may also offer possible resolutions
of the issues but has no duty to do so.
(d) Arbitration. If the matter is not resolved after applying the
-----------
mediation procedures set forth above, or if either party refuses to take part in
the mediation process, the parties hereby agree to submit all controversies,
claims and matters of difference that are unresolved to arbitration in Chicago,
Illinois, according to the commercial rules and practices of the American
Arbitration Association ("AAA") from time to time in force, and in accordance
with the following provisions of this subsection (d), and unless otherwise
agreed by the parties and subject to the rights of the parties as provided in
Section 18.1 and Section 18.2 hereof (including the right not to continue to
perform under this Agreement), they shall continue to perform under this
Agreement during arbitration.
(i) Arbitration discovery shall be conducted in accordance with the Federal
Rules of Civil Procedure, with any disputes over the scope of discovery to be
determined by the arbitrators, it being intended that the arbitrators shall
allow limited, reasonable discovery prior to any hearing on the merits.
(ii) Arbitration hereunder shall be by three independent and impartial
arbitrators. Each of the parties shall appoint one arbitrator within thirty
(30) days after initiation of arbitration and the two arbitrators so appointed
shall select a third arbitrator within forty-five (45) days after initiation of
arbitration. In the event that the parties or the arbitrators fail to select
arbitrators as required above, the AAA shall select such arbitrators.
(iii) The AAA shall have the authority to disqualify any arbitrator who it
determines not to be independent and impartial. The arbitrators shall be
entitled to a fee commensurate with their fees for professional services
requiring similar time and effort.
(iv) The arbitrators shall conduct a hearing no later than sixty (60) days
after initiation of the matter to arbitration, and a decision shall be rendered
by the arbitrators within thirty (30) days of the hearing. At the hearing, the
parties shall present such evidence and witnesses as they may choose, with or
without counsel. Adherence to formal rules of evidence shall not be required
but the arbitration panel shall consider any evidence and testimony that it
determines to be relevant, in accordance with procedures that it determines to
be appropriate. The arbitration determination shall be in writing and shall
specify the factual and legal bases for the determination. The arbitrators may
award legal or equitable relief, including but not limited to specific
performance.
(v) The parties agree that this submission and agreement to arbitrate shall
be governed by and specifically enforceable in accordance with the laws of the
State of Illinois. Arbitration may proceed in the absence of any party if prior
written notice of the proceedings has been given to such party. The parties
agree to abide by all decisions and determinations rendered in such proceedings.
Such decisions and determinations shall be final and binding on all parties.
All decisions and determinations may be filed with the clerk of one or more
courts, state, federal or foreign having jurisdiction over the party against
whom it is rendered or its property, as a basis of judgment.
(vi) The arbitrators' fees and other costs of the arbitration shall be
borne by the party against whom the award is rendered, except as the arbitration
panel may otherwise provide in its written opinion.
ARTICLE XXII.
WAIVER
------
22.1 The failure of either party hereto to enforce any of the
provisions of this Agreement, or the waiver thereof in any instance, shall not
be construed as a general waiver or relinquishment on its part of any such
provision, but the same shall nevertheless be and remain in full force and
effect.
ARTICLE XXIII.
GOVERNING LAW
-------------
23.1 This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of Illinois, without reference to its choice
of law principles. Any litigation based hereon, or arising out of or in
connection with a default by either party in the performance of its obligations
hereunder, shall be brought and maintained exclusively in the courts of the
State of Illinois or in the United States District Court for the Northern
District of Illinois, and each party hereby irrevocable submits to the
jurisdiction of such courts for the purpose of any such litigation and
irrevocably agrees to be bound by any judgment rendered thereby in connection
with such litigation.
ARTICLE XXIV.
RULES OF CONSTRUCTION
---------------------
24.1 The captions or headings in this Agreement are strictly for
convenience and shall not be considered in interpreting this Agreement or as
amplifying or limiting any of its content. Words in this Agreement which import
the singular connotation shall be interpreted as plural, and words which import
the plural connotation shall be interpreted as singular, as the identity of the
parties or objects referred to may require.
24.2 Unless expressly defined herein, words having well known
technical or trade meanings shall be so construed. All listing of items shall
not be taken to be exclusive, but shall include other items, whether similar or
dissimilar to those listed, as the context reasonably requires.
24.3 Except as set forth to the contrary herein, any right or remedy
of FRONTIER or QWEST shall be cumulative and without prejudice to any other
right or remedy, whether contained herein or not.
24.4 Except as expressly provided in Section 28.1, nothing in this
Agreement is intended to provide any legal rights to anyone not an executing
party of this Agreement.
24.5 This Agreement has been fully negotiated between and jointly
drafted by the parties.
24.6 All actions, activities, consents, approvals and other
undertakings of the parties in this Agreement shall be performed in a reasonable
and timely manner, it being expressly acknowledged and understood that time is
of the essence in the performance of obligations required to be performed by a
date expressly specified herein. Except as specifically set forth herein, for
the purpose of this Agreement the standards and practices of performance within
the telecommunications industry in the relevant market shall be the measure of a
party's performance.
ARTICLE XXV.
ASSIGNMENT AND DARK FIBER TRANSFERS
-----------------------------------
25.1 Except as provided below, QWEST shall not assign, encumber or
otherwise transfer this Agreement or all or any portion of its rights or
obligations hereunder to any other party without the prior written consent of
FRONTIER, which consent will not be unreasonably withheld or delayed.
Notwithstanding the foregoing, QWEST shall have the right, without FRONTIER's
consent, to (i) subcontract any of its construction or maintenance obligations
hereunder, or (ii) assign or otherwise transfer this Agreement in whole or in
part (A) as collateral to any institutional lender to QWEST (or institutional
lender to any permitted transferee or assignee of QWEST) subject to the prior
rights and obligations of the parties hereunder, (B) to any parent, subsidiary
or affiliate of QWEST, (C) to any person, firm or corporation which shall
control, be under the control of or be under common control with QWEST, or (D)
any corporation or other entity into which QWEST may be merged or consolidated
or which purchases all or substantially all of the stock or assets of QWEST, or
(E) any partnership, joint venture or other business entity of which QWEST or
any wholly owned subsidiary of QWEST HOLDING CORPORATION owns at least 50
percent of the equity interests thereof and which cannot make major decisions
without the consent of QWEST (or subsidiary of QWEST HOLDING CORPORATION);
provided that the assignee or transferee in any such circumstance shall continue
to be subject to all of the provisions of this Agreement, including without
limitation, this Section 25.1 (except that any lender referred to in clause (A)
above shall not incur any obligations under this Agreement nor shall it be
restricted from exercising any right of enforcement or foreclosure with respect
to any related security interest or lien, so long as the purchaser in
foreclosure is subject to the provisions of this Agreement, including, without
limitation, this Section 25.1); and provided further that promptly following any
---------------------
such assignment or transfer, QWEST shall give FRONTIER written notice
identifying the assignee or transferee. In the event of any permitted partial
assignment of any rights hereunder, QWEST shall remain the sole point of contact
with FRONTIER. No permitted partial or complete assignment shall release or
discharge QWEST from its duties and obligations hereunder.
25.2 Except as provided in this Section 25.2 and the following Section
25.3, FRONTIER shall not assign, encumber or otherwise transfer this Agreement
or all or any of portion of its rights or obligations hereunder to any other
party without the prior written consent of QWEST, which consent will not be
unreasonably withheld or delayed. Subject to the
provisions of Section 25.3 (which provision shall be binding upon any permitted
assignee or transferee hereunder), FRONTIER shall have the right, without
QWEST's consent, to assign or otherwise transfer this Agreement in whole or in
part (i) as collateral to any institutional lender to FRONTIER (or institutional
lender to any permitted transferee or assignee of FRONTIER) subject to the prior
rights and obligations of the parties hereunder, (ii) to any parent, subsidiary
or affiliate of FRONTIER, (iii) to any person, firm or corporation which shall
control, be under the control of or be under common control with FRONTIER, or
(iv) any other entity into which FRONTIER may be merged or consolidated or which
purchases all or substantially all of the stock or assets of FRONTIER or (v) any
partnership, joint venture or other business entity of which FRONTIER or any
wholly owned subsidiary of FRONTIER CORPORATION owns at least 50 percent of the
equity interests thereof and which cannot make major decisions without the
consent of FRONTIER CORPORATION (or subsidiary of FRONTIER CORPORATION);
provided that no assignment or other transfer under this clause (v) shall be
permitted hereunder if its purpose or effect would constitute, directly or
indirectly, a Restricted Transaction (as defined in Section 25.3(a)) or
otherwise violate the provisions of Section 25.3(a); provided that the assignee
-------------
or transferee in any such circumstance shall continue to be subject to all of
the provisions of this Agreement, including without limitation this Section 25.2
and the following Section 25.3 (except that any lender referred to in clause (i)
above shall not incur any obligations under this Agreement, nor shall it be
restricted from exercising any right of enforcement or foreclosure with respect
to any related security interest or lien, so long as the purchaser in
foreclosure is subject to the provisions of this Agreement, including, without
limitation, this Section 25.2 and the following Section 25.3); and provided
--------
further that in any of circumstances described in clauses (ii), (iii) or (iv)
- ------------
all of the payment obligations of FRONTIER hereunder for the remainder of the
Term shall be fully guaranteed by Frontier Corporation or shall be paid in full
as a condition to such transfer or assignment; and provided further that
---------------------
promptly following any such assignment or transfer, FRONTIER shall give QWEST
written notice identifying the assignee or transferee. In the event of any
permitted partial assignment of any rights hereunder, FRONTIER shall remain the
sole party and point of contact with QWEST hereunder. No permitted partial or
complete assignment shall release or discharge FRONTIER or Frontier Corporation
from its duties and obligations hereunder.
25.3 (a) Notwithstanding the provisions of Article XI, except as
expressly permitted in Section 25.2(i)-(v), inclusive, without the
prior written consent of QWEST, which consent may be withheld in
QWEST's sole discretion, until the Restriction Termination Date (as
defined below) shall have occurred with respect to any Segment
delivered hereunder, FRONTIER shall not sell, assign, lease, grant an
IRU with respect to, exchange, encumber, or otherwise in any manner
transfer or make available in any manner to any third party the
ownership, right to use, or use of, or access in any manner to, any of
FRONTIER's rights in the whole and discrete FRONTIER Fibers comprising
such Segment as Dark Fibers (any of the foregoing, a "Restricted
Transaction") (or engage in substantive discussions or negotiations
with respect to a Restricted Transaction), or otherwise engage in a
similar transaction with respect to any FRONTIER Fibers comprising
such Segment in a manner designed or intended to circumvent the
foregoing limitations. The restrictions and prohibitions imposed
under this Section 25.3(a) apply to the FRONTIER Fibers as Dark Fibers
only, and nothing contained herein shall restrict or prohibit FRONTIER
from creating telecommunications capacity along or through the
FRONTIER Fibers by the addition of FRONTIER's electronic and optronic
equipment and selling or otherwise permitting third parties to use
such telecommunications capacity. For purposes hereof, (i) with
respect to each Segment for which the Estimated Delivery Date (without
regard to any extension under 33.1(d)), as set forth in Exhibit A, is
scheduled to occur on or before
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
, the Restriction
Termination Date shall mean
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
(A) plus such number of
days, if any, by which the Estimated Delivery Date for such Segment is
extended as provided in Section 33.1(d)(B), and (B) subject to the
immediately following proviso, plus such number of days, if any, by
which the Estimated Delivery Date for such Segment is extended as
provided in Section 33.1(d)(A), provided that such extension by this
clause (B) of this Section 25.3(a) shall not apply to a Restricted
Transaction covering an aggregate of at least
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
route miles of the
FRONTIER fibers within the QWEST System; and (ii) with respect to each
Segment for which the Estimated Delivery Date (without regard to any
extension under 33.1(d)), as set forth in Exhibit A, is scheduled to
occur after
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
, the Restriction Termination Date shall
mean the date that is
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
months after the actual Estimated
Delivery Date for such Segment.
(b) Notwithstanding the provisions of Section 25.3(a), if and to
the extent that FRONTIER exercises the System Fiber Option pursuant to
Section 1.4(a) or (b) hereof or the Sacramento/Seattle Fiber Option
pursuant to Section 1.4(c) hereof, FRONTIER may sell, assign, lease,
grant an IRU with respect to, exchange, or otherwise transfer the
ownership, right to use, or use of FRONTIER's rights (each, a
"Permitted Transfer") (i) in any or all of the Optional System Dark
Fibers so acquired to that particular third party separately
identified by FRONTIER to, and approved by, QWEST as of the date
hereof for this purpose (the "Permitted System Acquiror"), or (ii) in
any or all of the Optional Sacramento/Seattle Dark Fibers so acquired
by FRONTIER to that particular third party separately identified by
FRONTIER to QWEST as of the date hereof for this purpose (the
"Permitted Sacramento/Seattle Acquiror"); provided that each of the
Permitted System Acquiror and Permitted Sacramento/Seattle Acquiror
shall be an Interest Holder as defined in Section 10.4 hereof and
shall be subject to all of the obligations, limitations and
requirements otherwise applicable to FRONTIER under this Agreement,
including, without limitation, Article XXV, with respect to the
Optional System Dark Fibers and Optional Sacramento/Seattle Dark
Fibers, respectively, and FRONTIER shall provide to QWEST written
evidence, reasonably satisfactory to QWEST, thereof; and provided
further that the amount payable by the Permitted System Acquiror and
Permitted Sacramento/Seattle Acquiror to FRONTIER in consideration of
any such Permitted Transfer shall be not less than $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
per mile.
No such Permitted Transfer shall relieve FRONTIER from any of its
obligations hereunder, or Frontier Corporation from any of its
obligations under the Guaranty, and FRONTIER shall continue to be the
sole party and point of contact with QWEST hereunder. Any and all of
the Optional System Dark Fibers and Optional Sacramento/Seattle Dark
Fibers acquired by FRONTIER that it does not transfer to the Permitted
System Acquiror or Permitted Sacramento/Seattle Acquiror,
respectively, shall remain subject to all of the requirements and
limitations of this Article XXV.
(c) Notwithstanding the provisions of Section 25.3(a), from the
date hereof until the date that is thirty (30) days after the date hereof,
FRONTIER may make a Permitted Transfer in up to twelve (12) of the Dark Fibers
to be subject to the IRU in Segment 23 hereunder to a that particular third
party separately identified by FRONTIER to, and approved by, QWEST as of the
date hereof for this purpose (the "Permitted Segment 23 Acquiror");
provided that the Permitted Segment 23 Acquiror shall be an Interest Holder as
-------------
defined in Section 10.4 hereof and shall be subject to all of the obligations,
limitations and requirements
otherwise applicable to FRONTIER under this Agreement, including, without
limitation, Article XXV, with respect to the Dark Fibers so transferred and
FRONTIER shall provide to QWEST written evidence, reasonably acceptable to
QWEST, thereof; and provided further that the amount payable by the Permitted
---------------------
Segment 23 Acquiror to FRONTIER in consideration of any such Permitted Transfer
shall not be less than $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
per route mile. No such Permitted Transfer shall
relieve FRONTIER from any of its obligations hereunder, or Frontier Corporation
from any of its obligations under the Guaranty, and FRONTIER shall continue to
be the sole party and point of contact with QWEST hereunder.
25.4 QWEST and FRONTIER recognize that QWEST may desire to obtain tax-
deferred exchange treatment pursuant to Section 1031 of the Internal Revenue
Code, as amended, with respect to certain of the Dark Fibers and Associated
Property in which the IRUs are to be granted hereunder and which are used or
held for use by QWEST in its business as of the date hereof (the "Existing
Properties"), and FRONTIER agrees to reasonably cooperate as provided herein in
obtaining such treatment (at no cost or expense to FRONTIER). Accordingly,
notwithstanding any provision contained in this Agreement to the contrary, QWEST
may, at its sole option, on or prior to the Acceptance Date for any relevant
Segment, appoint a third party (the "Intermediary") as agent for QWEST with
respect to the transfer of the Existing Properties to FRONTIER, and assign its
rights under this Agreement (insofar as they relate to the Existing Properties)
to such Intermediary. If QWEST so elects to appoint an Intermediary, QWEST
shall notify FRONTIER, in writing, on or prior to the Acceptance Date with
respect to the relevant Segment, and shall provide FRONTIER with copies of all
agreements between QWEST and the Intermediary. If QWEST appoints an
Intermediary, QWEST shall transfer the Existing Properties or such portion
thereof as designated by QWEST to the Intermediary, and FRONTIER shall pay the
IRU Fee with respect to the Existing Properties (as designated by QWEST) to the
Intermediary; provided that QWEST agrees that such transfer shall be expressly
-------------
subject to this Agreement, and that QWEST shall remain liable for performance
under this Agreement to the same extent as if it had not appointed an
Intermediary; provided that in such event QWEST shall indemnify and hold
-------------
harmless FRONTIER from and against any and all loss, damage, cost or expense
suffered, sustained or incurred by FRONTIER in connection with any such
cooperation and/or payment of such IRU Fee to such Intermediary.
25.5 This Agreement and each of the parties' respective rights and
obligations under this Agreement, shall be binding upon and shall inure to the
benefit of the parties hereto and each of their respective permitted successors
and assigns.
ARTICLE XXVI.
REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENTS
-----------------------------------------------
26.1 Each party represents and warrants that:
(a) it has the full right and authority to enter into, execute, deliver and
perform its obligations under this Agreement;
(b) this Agreement constitutes a legal, valid and binding obligation
enforceable against such party in accordance with its terms, subject to
bankruptcy, insolvency, creditors' rights and general equitable principles; and
(c) its execution of and performance under this Agreement shall not violate
any applicable existing regulations, rules, statutes or court orders of any
local, state or federal government agency, court or body.
26.2 QWEST represents and warrants that the Segments of the QWEST
System that it has heretofore constructed or will construct pursuant hereto have
been or shall be designed, engineered, installed, and constructed in compliance
with the terms and provisions of this Agreement and in material compliance with
any and all applicable building, construction and safety codes for such
construction and installation, as well as any and all other applicable
governmental laws, codes, ordinances, statutes and regulations.
26.3 With respect to each of the Segments that has been constructed
prior to the date hereof, QWEST represents and warrants that such Segment, when
constructed, generally was constructed substantially in accordance with the
specifications set forth in Exhibit C hereto, and QWEST has no actual knowledge
on the date hereof of any material deviation in the construction of such Segment
from such specifications. If, within twelve (12) months from the respective
Acceptance Date for each of the Segments referred to in this Section 26.3 ,
there is an event or occurrence that is caused by a material deviation in the
construction or installation of any of such Segments from such specifications,
and which has a material adverse affect on the operation or performance of the
FRONTIER Fibers in such Segment, then, promptly following receipt of written
notice thereof from FRONTIER, QWEST, at its sole cost and expense, shall
undertake to repair the affected portion of such Segment to the relevant
specifications.
26.4 QWEST represents and warrants that the Segments of the QWEST
System that it constructs pursuant hereto shall be constructed in all material
respects in accordance with the specifications set forth in Exhibit C hereto;
provided that FRONTIER's sole rights and remedies with respect to any failure to
so construct shall be (i) to inspect the construction, installation and
splicing, and participate in the acceptance testing, of the FRONTIER Fibers
incorporated in each such Segment, during the course and at the time of the
relevant construction, installation and testing periods for each Segment, as
provided in Articles III and IV, (ii) if, during the course of such
construction, installation and testing any material deviation from the
specifications set forth in Exhibit C is discovered, the construction or
installation of the affected portion of the Segment shall be repaired to such
specification by QWEST at QWEST's sole cost and expense, and (iii) if, at any
time prior to the date that is twelve (12) months after the Acceptance Date,
FRONTIER shall notify QWEST in writing of its discovery of a material deviation
from the specifications set forth in Exhibit C with respect to any such Segment
(which notice shall be
given within thirty (30) days of such discovery) the construction or
installation of the affected portion of such Segment shall be repaired to such
specification by QWEST at QWEST's sole cost and expense. For purposes hereof,
"material deviation" means a deviation which is reasonably likely to have a
material adverse affect on the operation or performance of the FRONTIER Fibers
affected thereby.
26.5 EXCEPT AS SET FORTH IN THE FOREGOING PARAGRAPHS 26.2, 26.3 AND
26.4, AND EXCEPT AS MAY BE SET FORTH SPECIFICALLY AND EXPRESSLY ELSEWHERE IN
THIS AGREEMENT, QWEST MAKES NO WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE
FRONTIER FIBERS OR THE SEGMENTS DELIVERABLE HEREUNDER, INCLUDING ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE, AND ALL SUCH WARRANTIES ARE
HEREBY EXPRESSLY DISCLAIMED.
26.7 The parties acknowledge and agree that on and after the relevant
Acceptance Date FRONTIER's sole rights and remedies with respect to any defect
in or failure of the FRONTIER Fibers to perform in accordance with the
applicable vendor's or manufacturer's specifications with respect to the
FRONTIER Fibers shall be limited to the particular vendor's or manufacturer's
warranty with respect thereto, which warranty, to the extent permitted by the
terms thereof, shall be assigned to FRONTIER upon its request. In the event any
maintenance or repairs to the QWEST System are required as a result of a breach
of any warranty made by any manufacturers, contractors or vendors, unless
FRONTIER shall elect to pursue such remedies itself, QWEST shall pursue all
remedies against such manufacturers, contractors or vendors on behalf of
FRONTIER, and QWEST shall reimburse FRONTIER's costs for any maintenance
FRONTIER has incurred as a result of any such breach of warranty to the extent
the manufacturer, contractor or vendor has paid such costs.
26.8 QWEST and FRONTIER acknowledge and agree:
(a) that each grant of the IRU in the Frontier Fibers and Associated
Property for a Segment hereunder (each herein called a "Grant") will be treated
by each of them, vis-a-vis the other, as of and after the relevant effective
date thereof as described in Section 6.1, an executed grant to FRONTIER of an
interest in real property with respect to such Segment; and
(b) that, from and after the effective date of a Grant with respect to a
Segment, no material obligation of either QWEST or FRONTIER will remain to be
performed with respect to such Grant or Segment; and
(c) that, with respect to each such Grant, this Agreement is not intended
as an executory contract or unexpired lease subject to assumption, rejection, or
assignment by the trustee in bankruptcy of any party to this Agreement,
including, without limitation, assumption, rejection, or assignment under
Bankruptcy Code Section 365.
ARTICLE XXVII.
ENTIRE AGREEMENT; AMENDMENT
---------------------------
27.1 This Agreement, together with any Confidentiality Agreement
entered into in connection herewith and the letter identifying the Permitted
System Acquiror and the Sacramento/Seattle Acquiror as contemplated by Section
25.3(b) hereof and the Permitted Segment 23 Acquiror as contemplated by Section
25.3(c) and the letter dated October 16, 1996 regarding certain state and local
tax matters constitutes the entire and final agreement and understanding between
the parties with respect to the subject matter hereof and supersedes all prior
agreements relating to the subject matter hereof, which are of no further force
or effect. The Exhibits referred to herein are integral parts hereof and are
hereby made a part of this Agreement. To the extent that any of the provisions
of any Exhibit hereto are inconsistent with the express terms of this Agreement,
the terms of this Agreement shall prevail. This Agreement may only be modified
or supplemented by an instrument in writing executed by a duly authorized
representative of each party and delivered to the party relying on the writing.
ARTICLE XXVIII.
NO PERSONAL LIABILITY
---------------------
28.1 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 or director of the other
party. Each of such persons is an intended beneficiary of the mutual promises
set forth in this Article and shall be entitled to enforce the obligations of
this Article.
ARTICLE XXIX.
RELATIONSHIP OF THE PARTIES
---------------------------
29.1 The relationship between FRONTIER and QWEST shall not be that of
partners, agents, or joint venturers for one another, and nothing contained in
this Agreement shall be deemed to constitute a partnership or agency agreement
between them for any purposes, including, but not limited to federal income tax
purposes. FRONTIER and QWEST, in performing any of their obligations hereunder,
shall be independent contractors or independent parties and shall discharge
their contractual obligations at their own risk subject, however, to the terms
and conditions hereof.
ARTICLE XXX.
LATE PAYMENTS
-------------
30.1 In the event a party shall fail to make any payment under this
Agreement when due, such amounts shall accrue interest, from the date such
payment is due until paid, including accrued interest compounded monthly, at an
annual rate equal to
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
of the prime rate of interest published by The Wall
Street Journal as the base rate on corporate loans posted by a substantial
percentage of the nation's largest banks on the date any such payment is due or,
if lower, the highest percentage allowed by law.
ARTICLE XXXI.
SEVERABILITY
------------
31.1 If any term, covenant or condition contained herein shall, to any
extent, be invalid or unenforceable in any respect under the laws governing this
Agreement, the remainder of this Agreement shall not be affected thereby, and
each term, covenant or condition of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
ARTICLE XXXII.
COUNTERPARTS
------------
32.1 This Agreement may be executed in one or more counterparts, all
of which taken together shall constitute one and the same instrument.
ARTICLE XXXIII.
CERTAIN DEFINITIONS
-------------------
33.1 The following terms shall have the stated definitions in this
Agreement.
(a) "Cable" means the fiberoptic cable and the fibers contained therein,
and associated splicing connections, splice boxes, and vaults to be installed by
QWEST as part of the QWEST System.
(b) "Costs" means actual, direct costs paid or payable in accordance with
the established accounting procedures generally used by QWEST and which it
utilizes in billing third parties for reimbursable projects which costs shall
include, without limitation, the following: (i) internal labor costs, including
wages and salaries, and benefits and overhead allocable to such labor costs
(with the overhead allocation percentage equal to thirty percent (30%)), and
(ii) other direct costs and out-of-pocket expenses on a pass-through basis
(e.g., equipment, materials, supplies, contract services, etc.).
(c) "Dark Fiber" means fiber provided without electronics or optronics, and
which is not "lit" or activated; provided that such fiber may be used in any
-------------
manner and for any purpose permitted under Article XI.
(d) "Estimated Delivery Date" means, with respect to each Segment of the
QWEST System to be delivered hereunder, the date set forth in Exhibit A hereto
with respect to such Segment, as any such date may be extended for and during
(A) the period of any delay described in Article XX and/or (B) the period of any
payment default pursuant to Section 18.1 with respect to any Segment and/or (C)
the aggregate number of days of the FRONTIER Review Period or Periods (in the
event of multiple remedy attempts) under Section 4.2 with respect to such
Segment.
(e) "Impositions" means all taxes, fees, levies, imposts, duties, charges
or withholdings of any nature (including, without limitation, gross receipts
taxes and franchise, license and permit fees), together with any penalties,
fines or interest thereon (except for penalties or interest imposed as a direct
result of acts or failures to act on the part of QWEST) arising out of the
transactions contemplated by this Agreement and/or imposed upon the QWEST System
by any federal, state or local government or other public taxing authority.
(f) "Indefeasible Right of Use" or "IRU" means (i) an exclusive,
indefeasible right of use, for the purposes described herein, in the FRONTIER
Fibers, as granted in Article II, and (ii) an associated non-exclusive,
indefeasible right of use, for the purposes described herein, in the Associated
Property; provided that the IRUs granted hereunder do not provide FRONTIER with
-------------
any ownership interest in or other rights to physical access to, control of,
modification of, encumbrance in any manner of, or other use of the QWEST System
except as expressly set forth herein.
(g) "Pre-Existing Cal-Fiber Lien" means any and all security interests and
liens in favor of NTFC Capital Corporation (and its successors and assigns)
securing up to $28,000,000 principal amount plus accrued interest of
indebtedness of QWEST under the Term Loan Agreement dated as of June 16, 1994
between QWEST (then known as Southern Pacific Telecommunications Company) and
NTFC Capital Corporation, as the same may be amended from time to time, on the
collateral described therein, such collateral generally being described as the
Cal-Fiber telecommunications system located between One Wilshire Building, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇.
(h) "POP" means the FRONTIER point of presence at locations along the QWEST
System route.
(i) "PSWP" means Planned System Work Period, which is a prearranged period
of time reserved for performing certain work on the QWEST System that may
potentially impact traffic. Generally, this will be restricted to weekends,
avoiding the first and last weekend of each month and high-traffic weekends.
The PSWP shall be agreed upon pursuant to Exhibit H.
(j) "QWEST System" shall have the meaning ascribed thereto in Recital A.
(k) When used herein in connection with a covenant of a party to this
Agreement "best efforts" shall not obligate such party, unless otherwise
specifically required by the operative covenant, to make unreimbursed
expenditures (other than costs or expenditures that would have been required of
such party in the absence of the requirements of such covenant) that are
material in amount, in light of the circumstances to which the requirement to
use best efforts applies.
In confirmation of their consent and agreement to the terms and conditions
contained in this IRU Agreement and intending to be legally bound hereby, the
parties have executed this IRU Agreement as of the date first above written.
"QWEST":
QWEST COMMUNICATIONS CORPORATION, a
Delaware corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
____________________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President
"FRONTIER":
FRONTIER COMMUNICATIONS INTERNATIONAL INC., a
Delaware corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
____________________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
Frontier - Exhibit A-1
System Description and Delivery Dates
Estimated Estimated
Segment System Route Delivery
No. Segment (Priority Segments in Italics) Miles Date
- -------------------------------------------------------------------------------------------------------------------
Basic Route
- ------------------------------------------------
1A Chicago - Detroit 305 1/31/98
1B Detroit - ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇/▇▇/▇▇
▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇▇▇▇ 162 3/1/98
1D Pittsburgh - Philadelphia 356 3/31/98
1E Philadelphia - Washington, D.C. 138 4/30/98
Chicago - Detroit - Cleveland -
Washington, DC TOTAL 1,126 4/30/98
2A Cleveland - Columbus 133 8/31/97
2B Columbus - Cincinnati 125 8/31/97
Cleveland - Cincinnati TOTAL 258 8/31/97
4 Indianapolis - Chicago 215 12/31/97
5 Indianapolis - ▇▇. ▇▇▇▇▇ ▇▇▇ ▇/▇▇/▇▇
▇ ▇▇. ▇▇▇▇▇ - ▇▇▇▇▇▇ ▇▇▇▇ 297 7/1/97
7 Kansas City - Topeka 75 7/31/97
8 Denver - Topeka 565 7/31/97
9A Denver - Grand Junction 271 7/31/97
9B Grand Junction - Salt Lake City 295 7/31/97
Denver - Salt Lake City TOTAL 566 7/31/97
10A Salt Lake City - Reno 575 7/31/97
10B Reno - Roseville 136 7/31/97
Salt Lake - Roseville TOTAL 711 7/31/97
11A Roseville - Oakland 111 4/30/97
11B Oakland - San ▇▇▇▇ 43 4/30/97
Roseville - San ▇▇▇▇ TOTAL 154 4/30/97
12A San ▇▇▇▇ - Salinas 71 7/1/97
12B Salinas - San ▇▇▇▇ Obispo 132 7/1/97
12C San ▇▇▇▇ Obispo - Santa ▇▇▇▇▇▇▇ 119 7/1/97
12D Santa ▇▇▇▇▇▇▇ - Los Angeles 107 7/1/97
San ▇▇▇▇ - Los Angeles TOTAL 429 7/1/97
▇-▇ - ▇
▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ ▇-▇
System Description and Delivery Dates
Estimated Estimated
Segment System Route Delivery
No. Segment (Priority Segments in Italics) Miles Date
- -------------------------------------------------------------------------------------------------------------------
13A Los Angeles - Anaheim 2 7/1/97
13B Anaheim - San Diego 32 8/31/97
13C San Diego - Yuma 235 12/31/97
13D Yuma - Phoenix 187 1/31/98
Los Angeles - San Diego - Phoenix TOTAL 586 1/31/98
14A Phoenix - Tucson 123 2/28/98
14B Tucson - El Paso 310 3/31/98
Phoenix - Tucson - El Paso TOTAL 433 3/31/98
15A El Paso - San Antonio 586 5/31/98
15B San ▇▇▇▇▇▇▇ - ▇▇▇▇▇▇ 85 1/31/98
15C Austin - Houston 221 ▇▇/▇▇/▇▇
▇▇ ▇▇▇▇ - ▇▇▇ ▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ TOTAL 892 5/31/98
16 Houston - Dallas 269 4/30/97
17A Dallas - Oklahoma City 264 1/31/98
17B Oklahoma City - Tulsa 119 1/31/98
17C Tulsa - Kansas City 256 1/31/98
Dallas - Kansas TOTAL 639 1/31/98
18 Cincinnati - Indianapolis 117 7/1/97
23 Denver - El Paso TOTAL 746* 3/31/98
24A Sacramento - Chico 98* 1/31/98
24B ▇▇▇▇▇ - ▇▇▇▇▇▇▇ 75* 1/31/98
24C ▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ 177* 1/31/98
24D Medford - Eugene 206* 1/31/98
24E Eugene - Portland 123* 1/31/98
Sacramento - Portland TOTAL 679* 1/31/98
25 Portland - Seattle 182* 1/31/98
* Dates shown for segments indicated are for first 12 fibers; second 12 are due
12 months later
▇-▇ - ▇
▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ ▇-▇
System Description and Delivery Dates
Estimated Estimated
Segment System Route Delivery
No. Segment (Priority Segments in Italics) Miles Date
- -------------------------------------------------------------------------------------------------------------------
27 San ▇▇▇▇ - San Francisco 56 4/30/97
28A Boston - Albany 208 12/31/97
28B Albany - Buffalo 298 12/31/97
28C Buffalo - Cleveland 197 12/31/97
Boston - Cleveland TOTAL 703 12/31/97
29 Albany - New York City 157 5/31/98
30 New York City - Philadelphia 95 5/31/98
BASIC ROUTE 10,198 5/31/98
OPTION 1 Route
- ------------------------------------------------
22A Chicago - Cedar Rapids 255 3/31/98
22B Cedar Rapids - Des Moines 120 4/30/98
22C Des Moines - Omaha 140 4/30/98
22D Omaha - Topeka 224 6/30/98
TOTAL - Chicago - Topeka, OPTION 1 739 6/30/98
BASIC ROUTE & OPTION 1 SUB TOTAL 10,937 6/30/98
OPTION 1A Route (assuming that Option 1 is not exercised)
- ------------------------------------------------
21A Chicago - Milwaukee 84 10/31/98
21B Milwaukee - Green Bay 118 10/31/98
21C Green Bay - Minneapolis 295 10/31/98
21D Minneapolis - Des Moines 281 10/31/98
22C Des Moines - Omaha 140 10/31/98
22D Omaha - Topeka 224 10/31/98
TOTAL - Chicago - Des Moines, OPTION 1A 1,142 10/31/98
BASIC ROUTE & OPTION 1A SUB TOTAL 11,340 10/31/98
▇-▇ - ▇
▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ ▇-▇
System Description and Delivery Dates
Estimated Estimated
Segment System Route Delivery
No. Segment (Priority Segments in Italics) Miles Date
- -------------------------------------------------------------------------------------------------------------------
OPTION 2 Route
- ------------------------------------------------
3 Cincinnati - Louisville 107 7/30/98
19A Louisville - Nashville 189 9/30/98
19B Nashville - Chattanooga 147 10/31/98
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ ▇▇▇ ▇▇/▇▇/▇▇
▇▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇▇▇ TOTAL 473 10/31/98
20A Atlanta - Charlotte 261 10/31/98
20B Charlotte - Raleigh 174 8/31/98
20C Raleigh - Richmond 301 10/31/98
20D Richmond - Washington, DC 110 10/31/98
Atlanta - Raleigh - Washington TOTAL 846 10/31/98
OPTION 2 TOTAL 1,426 10/31/98
TOTAL (BASIC, OPTION 1 & OPTION 2 ROUTES) 12,363 10/31/98
TOTAL (BASIC, OPTION 1A & OPTION 2 ROUTES) 12,766 10/31/98
▇-▇ - ▇
▇▇▇▇▇▇▇ ▇-▇
[MAP APPEARS HERE]
Exhibit A-2 is a map of the United States with the heading "General Route Map"
showing state lines and routes of the fiber optic network upon completion. The
legend shows that a red line is the Base Route, a blue line is Route 1, an
orange line is Route 1A, a green line is Route 2, and one inch equals 225 miles.
The Base Route travels east to west through Massachusetts, Connecticut, New
York, Pennsylvania, New Jersey, Maryland, Michigan, Ohio, Indiana, Illinois,
Missouri, Kansas, Colorado, Utah and Nevada to California. The Base Route also
travels north to south through ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ and Oklahoma. Route 1 travels east to west through Illinois,
Iowa, Nebraska and Kansas. Route 1A travels east to west through Illinois,
Wisconsin, Minnesota and Iowa. Route 2 travels east to west through Maryland,
Virginia, North Carolina, South Carolina, Georgia, Tennessee, Kentucky and Ohio.
EXHIBIT A-3
BASIC AND OPTIONAL DETAILED ROUTE MAPS
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
Exhibit A-4
Designated Endpoint and Intermediate Cities
CITY ST LATA LATA NAME CITY ST LATA LATA NAME
- ----------------- -- ---- --------------- -------------- -- ---- --------------
Phoenix AZ 666 Phoenix Youngstown OH ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ 536 Oklahoma City
Yuma AZ 666 Phoenix Tulsa OK ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ 730 Los Angeles Eugene OR 670 Eugene
Chico CA 724 Chico Medford OR 670 Eugene
Los Angeles CA ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ 722 San ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ OR 672 Portland
Redding CA ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ 228 Philadelphia
Sacramento CA ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ 234 Pittsburgh
Salinas CA 736 Monterey Austin TX ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇ 732 San Diego Bryan TX 570 Hearne
San Francisco CA ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ 552 Dallas
San Jose CA ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇ 552 Dallas
Santa Barbara CA ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ 656 Denver Provo UT 660 Utah
Pueblo CO 658 Colorado Spr. ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ 358 Chicago OPTION 1
Indianapolis IN ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ IN ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ 534 Topeka ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇ 644 Omaha
Baltimore MD ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ 644 Omaha
Albuquerque NM ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇
Reno NV ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ 356 Southeast WI
Albany NY 134 Albany OPTION 2
Buffalo NY ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ 464 Owensboro
Poughkeepsie NY ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ 424 Greensboro
Utica NY 136 Syracuse Raleigh NC 426 Raleigh
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
Designated Endpoint and Intermediate Cities
CITY ST LATA LATA NAME CITY ST LATA LATA NAME
- -------------- -- ---- -------------- -------------- -- ---- -----------
White Plains NY ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇ 951 Rocky Mount
Akron OH ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ 328 Dayton Portsmouth VA ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ 326 Toledo Richmond VA 248 Richmond
EXHIBIT B
IRU Fee Payment Schedule
------------------------
1. Except as provided in paragraphs 2, 3 and 4 below, the IRU Fee for each
Segment shall be paid in accordance with the following schedule:
(i)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon execution of the IRU Agreement
(ii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon commencement of construction of such Segment
(iii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon completion of conduit installation of such Segment
(iv)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon completion of fiber cable placement in such Segment
(v)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon completion of fiber splicing and completion of civil
construction in such Segment
(vi)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% on the Acceptance Date for such Segment
2. The IRU Fee for Segment 23 shall be paid in accordance with the following
schedule:
(i)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon execution of the IRU Agreement
(ii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon the Acceptance Date for the first 12 Dark Fibers delivered in
accordance with Exhibit A
(iii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon the Acceptance Date for the second 12 Dark Fibers delivered
in accordance with Exhibit A
3. The IRU Fee for Segments 24A, ▇▇▇, ▇▇▇, ▇▇▇, ▇▇▇ ▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇ paid in
accordance with the following schedule:
(i)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon execution of the IRU Agreement
(ii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon commencement of construction of such Segment
(iii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon completion of conduit installation of such Segment
(iv)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon completion of fiber cable placement in such Segment
(v)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% upon completion of fiber splicing and completion of civil
construction in such Segment
(vi)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% on the Acceptance Date for the first 12 Dark Fibers delivered in
accordance with Exhibit A
(vii)
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% on the Acceptance Date for the second 12 Dark Fibers delivered in
accordance with Exhibit A
4. Notwithstanding anything to the contrary contained in this Exhibit B or the
IRU Agreement, no part of the IRU Fee for a Segment shall be payable by Frontier
(other than the
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% of the IRU Fee due upon execution of the IRU Agreement),
unless such Segment, when completed as planned, would be connected (whether
through one or more other completed Segment or Segments scheduled for
contemporaneous completion) or contiguous to one of the following cities where
Frontier maintains a switch site: Los Angeles, California; San Francisco,
California; Seattle, Washington; Denver, Colorado; Dallas, Texas; Atlanta,
Georgia; Kansas City, Missouri; Chicago, Illinois; Milwaukee, Wisconsin;
Detroit, Michigan; Cleveland, Ohio; Washington, D.C., Philadelphia,
Pennsylvania; New York City; Boston, Massachusetts; and Rochester, New York.
5. Upon any election by FRONTIER pursuant to Section 1.4 that results in a
redetermination of the IRU Fee pursuant to Section 2.1, (i) if such
redetermination results in an increase in the IRU Fee with respect to any
Segment, the increased amount with respect to that Segment shall be paid by
FRONTIER to QWEST upon such election, in accordance with paragraph 1 above of
the foregoing payment schedule, and (ii) if such redetermination results in a
decrease in the IRU Fee with respect to any Segment, the amount representing the
difference between the original IRU fee and the redetermined decreased IRU fee
(the "Decrease") with respect to that Segment either (A) shall be credited
------
against the subsequent IRU Fee payment or payments to be made by FRONTIER in
accordance with the percentages set forth in paragraph 1 of the foregoing
payment schedule with respect to such Segment or other Segments to be delivered
hereunder or, (B) if amounts shall have previously been paid by FRONTIER with
--
respect to such Segment, at FRONTIER's election, shall be refunded to FRONTIER
by QWEST.
6. For purposes of determining the occurrence of the construction milestones
triggering payment obligations hereunder, the following shall apply:
(i) Commencement of construction of a Segment shall mean the establishment
of a field office followed promptly by mobilization of either in-house
crews or the subcontract of a construction manager.
(ii) Completion of conduit installation shall mean the completion of
installation of the conduit system for the Segment, with handholds and
manholes, ready for Cable pulling.
(iii) Completion of fiber cable placement shall mean the fiber cable is
either pulled into the conduit or completely installed in aerial
installation, but without splicing. In the event of aerial
construction, the IRU Fee installment otherwise due upon
completion of conduit installation shall be due and payable at the
same time as the installment due upon completion of fiber cable
placement.
(iv) Completion of fiber splicing and civil construction shall mean all
fibers are spliced and ready for testing and civil facilities are
ready for the customer to occupy and install their equipment
(v) Acceptance Date shall have the meaning established in the IRU
Agreement.
EXHIBIT C
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
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
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
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
loading rating or
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
with
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
to
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
inches
of cover.
Manholes shall have a minimum
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
loading rating.
Innerducts used shall be
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
or
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
.
Buried cable warning tape shall be 3 inches wide and display "Warning:
Buried Fiber Optic Cable," name and logo, and local and emergency One Call
"800" numbers repeated every 24 inches.
Warning signs will display universal "Do Not Dig" symbol, "Warning: Buried
Fiber Optic Cable," company name and logo, and local and emergency One Call
"800" numbers.
Fiber optic cable shall be single armored.
3.0 Minimum Depths.
--------------
Minimum cover required in the placement of conduit shall be 42 inches,
except in the following instances:
(a) The minimum cover in borrow ditches adjacent to roads, highways,
railroads, and interstate highways is
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
inches below the cleanout line or
existing grade, whichever is greater.
(b) The minimum cover across streams, river washes and other waterways is
60 inches below the cleanout line or existing grade, whichever is greater.
Steel conduit will be placed at all such crossings unless the crossing is
directional bored.
(c) At locations where conduit crosses other subsurface utilities or other
structures, the conduit shall be installed to provide a minimum of
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
inches
of vertical clearance and applicable minimum depth can be maintained;
otherwise the conduit will be installed under the existing utility or other
structure. If, however,
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
inches cannot be obtained, the cable shall be
encased in steel pipe rather than conduit. No fiber optic cable shall be
buried without being surrounded by conduit or steel pipe.
(d) In rock, the conduit shall be placed to provide a minimum of
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
inches
below the surface of the solid rock, or provide a minimum of
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
inches of
total cover, whichever requires the least rock excavation. PVC or HDPE
conduit will be backfilled with 6 inches of select materials (padding) in
rock areas.
(e) In the case of the use/conversion of existing steel pipelines or
salvaged conduit systems, the existing depth shall be considered adequate.
4.0 Buried Cable Warning Tape.
-------------------------
All conduit will be installed with buried cable warning tape except where
existing steel pipelines or salvaged conduit systems are used. The warning
tape shall generally be placed at a depth of 12 inches below grade and
directly above the conduit.
5.0 Conduit Construction.
--------------------
Conduits may be placed by means of trenching, plowing, ▇▇▇▇ and bore, 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, Zap-Lok or welding.
All paved city, state, federal and interstate highways and railroad
crossings will be encased in steel conduit. If the crossing is at grade,
steel is not required if the cable is placed with
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feet of cover or more,
and the crossing is directional bored.
All crossings of major streams, rivers, bays and navigable waterways will
be placed in HDPE, PVC or steel conduit.
At all foreign utility/underground obstacle crossings, split/solid steel
conduit will be placed and will extend at least 5 feet beyond the outer
limits of the obstacle in both directions.
All ▇▇▇▇ and bores will use steel conduit.
All directional bores will use HDPE or steel conduit.
Any cable placed in rock will be placed in HDPE, PVC or steel conduit.
Any cable placed in swamp or wetland areas will be placed in HDPE, PVC or
steel conduit.
All conduits placed on bridges will be steel.
All conduits placed on bridges shall have expansion joints placed at each
structural (bridge) expansion joint or at least every 150 feet, whichever
is the shorter distance.
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 600 pounds.
Bends of small radii (less than 20 times the outside diameter of the cable)
and twists that may damage the cable shall be avoided during cable
placement.
The cable shall be lubricated and placed in accordance with the cable
manufacturer specifications.
A pulling swivel break-away rated at 600 pounds shall be used at all times.
All splices will be contained in a handhole or manhole.
A minimum of
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meters of slack cable will be left in all intermediate
handholes or manholes.
A minimum of
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meters of slack cable will be left in all splice locations.
A minimum of
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meters of slack cable will be left in all facility locations
(i.e., POP sites, switch sites, regens or CEVs).
8.0 Manholes and Handholes.
----------------------
Manholes shall be placed in traveled surface streets and shall have locking
lids.
Handholes shall be placed in all other areas and be installed with a
minimum of 18 inches of soil covering the lid.
9.0 EMS Markers.
-----------
EMS markers shall be placed 6 inches directly above the lid of all buried
handholes and assist points. EMS markers fabricated into the lids of
handholes are acceptable.
10.0 Cable Markers (Warning Signs).
-----------------------------
Cable markers (with the same information as buried cable warning tape)
shall be installed at all changes in cable running line direction, splices,
waterways, subsurface utilities, handholes and at both sides of street,
highway, bridge or railroad crossings. At no time shall any markers be
spaced more than 500 feet apart in metro areas and 1,000 feet apart in non-
metro areas. 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.
11.0 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).
12.0 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.)
5) Cable information (manufacturer, type of fiber, type of cable,
fiber assignments, final cable lengths)
6) Notation of all deviations from specifications (depth, etc.)
7) ROW detail (type, centerline distances, boundaries, waterways,
road crossings, known utilities and obstacles)
8) Cable marker locations and stationing
9) Regeneration locations and floorplans to include FDP assignments
(also labeled on site)
Drawings will be updated with actual field data during and after
construction.
Metro areas scale shall not exceed 1 inch = 200 feet.
Rural areas scale shall not exceed 1 inch = 500 feet.
As-builts will be provided within
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days after acceptance, in both hard
copy and electronic format (Auto-CAD version 13.0 or later). Updates to
the as-builts will be provided within
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
days of completion of change, like
a relocation project.
13.0 Aerial Construction.
-------------------
Subject to prior approval by both parties (which approval shall not be
unreasonably withheld), aerial construction methods will only be used when
buried construction techniques are impractical due to environmental
conditions, schedule or economic considerations, right of way issues, or
code restrictions. The parties acknowledge that aerial construction on
utility towers (not utility poles) using optical groundwire or all
dielectric self-support methods may be used without FRONTIER approval,
provided QWEST agrees to give FRONTIER reasonable prior notice of its
decision to use such aerial methods.
Aerial design standards and construction techniques will conform with
industry-accepted practices for aerial fiber optic cable systems. All
aerial plant must comply with applicable national (NEC, NESC, etc.), state,
and local codes.
The fiber optic cable placed on an aerial system shall be armored and
designed for aerial applications.
The cable will be placed in accordance with manufacturer specifications.
Cable tension will be monitored during placement. Cable rollers will be
placed at a maximum interval of 35 feet. Cable expansion loops will be
placed at every pole. Cable identification/warning tags will be placed at
every pole. All cable splices will be buried in handholes or manholes.
Cable sheath to suspension strand bonds and grounding will be performed at
the first and last pole of the system and at 0.25 mile intervals.
Fiber optic cable at all riser poles will be protected with galvanized
steel U-guard from 12 inches below grade to a point 24 inches below the
suspension strand. Conduit sweeps will be used to transition from the U-
guard to either a handhole or manhole.
All aerial plant will be designed and constructed with 10M EHS (Class A
galvanized) suspension strand unless otherwise dictated by the pole owners
or field conditions. The
fiber optic cable will be doubled lashed to the suspension strand using 45
mil stainless lashing wire.
Span length shall account for storm loading (wind and ice) in accordance
with zones outlined in NESC code. Sags and tensions will be calculated in
accordance with industry accepted practices and account for strand size,
span length, ambient temperature at placement, and loading. The suspension
strand will be tensioned with a strand dynamometer. A catenary suspension
system may be used if the system exceeds maximum span length
specifications.
Prior to attachment to any existing pole line, the system will be inspected
for compliance with applicable codes and standards, as well as the physical
condition of the poles and existing hardware. Any make-ready work will be
reviewed with the pole owner and specifically addressed prior to
construction.
If a pole line need be constructed, the preferred poles will be Class 4 (40
feet) and Class 5 (35 feet). Use of the preferred poles will make it
unnecessary to calculate pole loading (horizontal, vertical, and bending
moments) in most field conditions. Some unusual conditions may require the
use of a stronger class pole. Depth of placement will be dictated by soil
conditions, slope of terrain, and length of pole. Poles will be guyed in
accordance with industry-accepted standards. All pole attachment hardware
will be galvanized steel.
Aerial cable will be placed below power attachments and above all other
attachments unless otherwise dictated by the pole owner. Pole contact
clearances and locations will be dictated by current NESC code and the
presence of existing attachments; however, the following minimum objective
clearances will apply:
a) Power line - 40 inches (below)
b) Non-current carrying power line - 30 inches
c) Telephone, CATV, and other signal lines - 12 inches (above)
Vertical clearances for crossings or parallel lines will be dictated by
current NESC code; however, the objective clearance for most objects
(roads, alleys, etc.) is 18 feet (at 100 degrees F) with the exception of
railroad tracks and waterways which have an objective of 27 feet (at 100
degrees F).
14.0 Approval of Deviations From Specifications.
------------------------------------------
Qwest will seek the approval of FRONTIER, which approval shall not be
unreasonably withheld or delayed, prior to undertaking any construction
which will deviate from the Construction Specifications set forth in this
Exhibit C.
EXHIBIT D
Fiber Cable Splicing, Testing and Acceptance Procedures
-------------------------------------------------------
1. All splices will be performed with an industry-accepted fusion splicing
machine. Qwest will perform two stages of testing during the construction of a
new fiber cable route. Initially, OTDR tests will be taken from one direction.
As soon as fiber connectivity has been achieved to both regen sites, Qwest will
verify and record the continuity of all fibers. Qwest will take and record
power level readings on all fibers in both directions. Qwest will bi-
directional OTDR test all fibers.
2. During the initial construction, it is only possible to measure the
fiber from one direction. Because of this, splices will be qualified during
initial construction with an OTDR from only one direction. The profile
alignment system or light injection detection system on the fusion splicer may
be used to qualify splices as long as a close correlation to OTDR data is
established. The pigtails will also be qualified at this stage using an OTDR
and a minimum 1 km launch reel. All measurements at this stage in construction
will be taken at 1550 nm.
3. After Qwest has provided end-to-end connectivity on the fibers, bi-
directional span testing will be done. These measurements must be made after
the splice manhole or handhole is closed in order to check for macro-bending
problems. Continuity tests will be done to verify that no fibers have been
"frogged" or crossed in any of the splice points. Once the pigtails have been
spliced, loss measurements will be recorded using an industry-accepted laser
source and a power meter. OTDR traces will be taken and splice loss
measurements will be recorded. Qwest will also store OTDR traces on diskette
and on data sheets. Laser Precision format will be used on all traces. Qwest
will provide three copies of all data sheets and tables, and one set of
diskettes with all traces.
a. The power loss measurements shall be made at 1550 nm, and
performed bi-directionally.
b. OTDR traces shall be taken in both directions at 1550 nm.
4. The splicing standards are as follows:
a. The loss value of the pigtail connector and its associated splice
will not exceed 0.50 dB. This value does not include the insertion loss from
its connection to the FDP. For values greater than this, the splice will be
broken and respliced until an acceptable loss value is achieved. If, after five
attempts, Qwest is not able to produce a loss value less than 0.50 dB, the
splice will be marked as Out-of-Spec ("OOS") on the data sheet. Each splicing
attempt shall be documented on the data sheet.
b. During initial uni-directional OTDR testing, the objective for
each splice is a loss of 0.15 dB or less. If, after three attempts, Qwest is
not able to produce a loss value of less than 0.15 dB, then 0.25 dB will be
acceptable. If, after two additional attempts, a value of less than 0.25 dB is
not achievable, then the splice will be marked as OOS on the data sheet. Each
splicing attempt shall be documented on the data sheet.
c. During end-to-end testing of a span (a span shall be FDP to FDP),
the objective for each splice is a bi-directional average loss of 0.15 dB or
less.
d. The standard for each fiber within a span shall be an average bi-
directional loss of 0.10 dB or less for each splice. For example, if a given
span has 10 splices, each fiber shall have total bi-directional loss (due to the
10 splices) of 1.0 dB or less. Each individual splice may have a bi-directional
loss of 0.15 dB or less, but the average bi-directional splice loss across the
span must be 0.10 dB or less.
5. The entire fiber optic cable system shall be properly protected from
foreign voltage and grounded with an industry-accepted system. The current
system in use by Qwest is depicted in the attached schematic-DWG No. SAH-1
(typical for Surge Arrestor HH Placement).
6. Customer fiber assignments will be consecutive in count and in a
separate buffer tube (or ribbon or fiber bundles) from others. The maximum
number of fibers within a single buffer tube (or ribbon or fiber bundles) shall
be 12.
7. The fibers shall be terminated to the FDP with Ultra FC-PC connectors,
unless another type of connector is specified. The pigtails shall be
manufactured with the same glass as the backbone cable to minimize splice loss.
EXHIBIT E
FIBER SPECIFICATIONS
[This exhibit contains product specification information that is largely set
forth in graphic format.]
EXHIBIT E-1
[MAP APPEARS HERE]
Exhibit E-1 is a map of the United States with the heading "Fiber Deployment
Diagram" showing state lines and routes of the fiber optic network upon
completion. The legend shows that a tan line represents Fiber not designated, a
solid blue line is LS Fiber (Existing), a broken blue line is LS Fiber
(Planned), a broken red line is Lucent TWF (Planned), a solid turquoise line is
DS Fiber (Existing), and one inch equals 225 miles. The Fiber Not Designated
Route travels east to west through Massachusetts, Connecticut, New York,
Pennsylvania, New Jersey, Maryland, Virginia, North Carolina, South Carolina,
Georgia, Tennessee, Kentucky, Ohio, Indiana, Illinois, Wisconsin, Minnesota,
Iowa, Missouri, Kansas, Oklahoma, Texas, New Mexico, Arizona, California,
Washington and Oregon. The LS Fiber (Existing) travels north to south through
Texas, and also north to south through Colorado and New Mexico. The DS Fiber
(Existing) travels north to south through California. The Lucent TWF (Planned)
travels east to west through Ohio, Indiana, Illinois, Missouri, Kansas,
Colorado, Utah, and Nevada.
EXHIBIT F
Specifications for Regeneration Facilities
------------------------------------------
Qwest will install modular, prefabricated, conditioned space along the
right of way to house regeneration and other electronic equipment (supplied by
Customer) necessary for the operation of the Qwest System.
Regeneration site facilities consist of
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CONFIDENTIAL TREATMENT##
square feet of caged space in
such facilities with separate, lockable secured, 24-hour access. The buildings
will be
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feet wide by approximately
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feet interior length to provide such
square footage. Also included is access to
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amps of DC power provided from a
common source backed up by a standby generator as described below. To the
extent provided in the Agreement, any additional space and/or power required may
be made available, with Frontier responsible for QWEST's incremental cost.
Following are the general specifications of the buildings and support equipment.
Standard production, metal-framed buildings with steel substructure or
concrete; bullet resistant to 30-06 slugs from 15 feet; walls and ceilings R-19
insulated.
Security-type weatherproof exterior light fixtures, equipped with motion
sensors.
Building is equipped with Marvair Compact II or equivalent redundant HVAC
units.
The building platform comes equipped with an external
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kw backup generator
designed to provide power during emergency periods. The generator fuel tanks
will have a minimum
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gallon capacity. As part of the normal maintenance, the
generator will be exercised twice monthly, running on a load bank for a minimum
of
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CONFIDENTIAL TREATMENT##
.
Fire extinguishers are provided one inside main door, and one located near
the HVAC systems.
A fire suppression system (FM-200) will be in place, as the main overall
fire protection coverage.
The building will have an earth ground termination bar (safety green wire
ground) terminated to building steel and/or driven ground rod.
The building will be equipped with A/C duplex isolated outlets for testing
and miscellaneous equipment. Such outlets shall be national electronic code and
placed every 6 feet around perimeter walls.
The building will have sufficient lighting.
Two properly sized cable racks will be installed, one from the DC power
source and one from the FDP. Qwest will run properly sized cables from the
common DC power plant to the Frontier-supplied fuse panel in the Frontier space.
DC power in the amount of
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amps shall be provided based upon a one (1) for
N rectifier format (i.e.,
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CONFIDENTIAL TREATMENT##
amp units or
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
amp units). A battery plant capable
----
of handling the load for a minimum of four (4) hours to ensure uninteruptable
power will be installed in the building. At remote regeneration locations QWEST
will also provide a battery plant designed to provide at least
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CONFIDENTIAL TREATMENT##
, and
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
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at
all other locations, in both cases with sufficient generator fuel to provide
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CONFIDENTIAL TREATMENT##
backup in the event of a power outage. The battery plant shall incorporate load
disconnect protection and batteries capable of recharging in 12 hours. The
battery plant shall also include dual battery strings with battery disconnects
for maintenance purposes.
Power will be monitored twenty-four (24) hours per day, seven (7) days a
week.
Each party's fibers will be terminated in a separate bulkhead module within
the QWEST fiber distribution panel.
Upon execution of the IRU Agreement, the parties will finalize the
locations of the regeneration facilities in accordance with Section 7.2 of the
IRU Agreement.
Exhibit G
Regeneration Facility Sites
Estimated Points
Segment Route of Amplifier
No. Segment Miles Presence Sites
Base System
1A Chicago to Detroit
Chicago to ▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇ ▇
▇▇▇▇▇ ▇▇▇▇ to Battle Creek 95 1 1
Battle Creek to Detroit 124 1 2
1B Detroit to Cleveland
Detroit to Toledo 60 1 0
Toledo to ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇ ▇
▇▇ ▇▇▇▇▇▇▇▇▇ to Pittsburgh
Cleveland to Akron 42 1 0
Akron to Youngstown 60 1 0
Youngstown to Pittsburgh 60 1 0
1D Pittsburgh to Philadelphia
Pittsburgh to Harrisburg 238 1 3
Harrisburg to Philadelphia 118 1 1
1E Philadelphia to Washington
Philadelphia to Baltimore 107 1 1
Baltimore to Washington 31 1 0
2A Cleveland to Columbus 133 1 2
2B Columbus to Cincinnati
Columbus to Dayton 60 1 0
Dayton to Cincinnati 65 1 0
4 Indianapolis to Chicago 215 1 3
5 Indianapolis to ▇▇. ▇▇▇▇▇ ▇▇▇ ▇ ▇
▇ ▇▇. ▇▇▇▇▇ to ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇ ▇
▇ ▇▇▇▇▇▇ ▇▇▇▇ to Topeka 75 1 0
Exhibit G
Regeneration Facility Sites
Estimated Points
Segment Route of Amplifier
No. Segment Miles Presence Sites
8 Topeka to Denver 565 1 9
9A Denver to Grand Junction 271 1 4
9B Grand Junction to Salt Lake City
Grand Junction to Provo 265 1 4
Provo to ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇ ▇ ▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ to Reno 575 1 9
10B Reno to Roseville 136 1 2
11A Roseville to Oakland
Roseville to Sacramento 19 1 0
Sacramento to Oakland 92 1 1
11B Oakland to ▇▇▇ ▇▇▇▇ ▇▇ ▇ ▇
▇▇▇ ▇▇▇ ▇▇▇▇ to ▇▇▇▇▇▇▇ 71 1 0
12B ▇▇▇▇▇▇▇ to San ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇ ▇
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ to Santa ▇▇▇▇▇▇▇ 119 1 1
12D Santa ▇▇▇▇▇▇▇ to Los Angeles 107 1 1
13A Los Angeles to Anaheim 32 1 0
13B Anaheim to San Diego 132 1 2
13C San Diego to Yuma 235 1 3
13D Yuma to Phoenix 187 1 3
14A Phoenix to Tucson 123 1 1
14B Tucson to El Paso 310 1 5
Exhibit G
Regeneration Facility Sites
Estimated Points
Segment Route of Amplifier
No. Segment Miles Presence Sites
15A El Paso to San Antonio 586 1 9
15B San Antonio to Austin 85 1 1
15C Austin to Houston 221 1 3
16 Houston to Dallas
Houston to ▇▇▇▇▇ 90 1 1
▇▇▇▇▇ to Mexia 90 1 1
Mexia to Dallas 89 1 1
17A Dallas to Oklahoma City
Dallas to Ft. Worth 60 1 0
Ft. Worth to ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇ ▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ to Tulsa 119 1 1
17C Tulsa to Kansas City 256 1 4
18 Cincinnati to Indianapolis 117 0 1
23 Denver to El Paso
Denver to Colorado Springs 76 1 0
Colorado Springs to Pueblo 45 1 0
Pueblo to Lamy 288 1 4
Lamy to Albuquerque 67 1 0
Albuquerque to El Paso 252 0 3
Lamy to Santa Fe 18 1 0
24A Sacramento to Chico 98 1 1
24B Chico to Redding 75 1 0
24C Redding to Medford 177 1 2
Exhibit G
Regeneration Facility Sites
Estimated Points
Segment Route of Amplifier
No. Segment Miles Presence Sites
24D Medford to ▇▇▇▇▇▇ 206 1 3
24E ▇▇▇▇▇▇ to Portland
▇▇▇▇▇▇ to Salem 69 1 0
Salem to Portland 54 1 0
25 Portland to ▇▇▇▇▇▇▇ ▇▇▇ ▇ ▇
▇▇ ▇▇▇ ▇▇▇▇ to San Francisco 56 1 0
28A Boston to ▇▇▇▇▇▇ ▇▇▇ ▇ ▇
▇▇▇ ▇▇▇▇▇▇ to Buffalo
Albany to Utica 101 1 1
Utica to Syracuse 51 1 0
Syracuse to Rochester 86 1 1
Rochester to Buffalo 60 1 0
28C Buffalo to Cleveland 197 0 3
29 Albany to New York City
Albany to Poughkeepsie 74 1 1
Poughkeepsie to White Plains 58 1 0
White Plains to ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇ ▇ ▇
▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇ to Philadelphia
New York City to Newark 13 1 0
Newark to Trenton 48 1 0
Trenton to Philadelphia 34 0 0
Sub Total Base System 10,198 73 119
Exhibit G
Regeneration Facility Sites
Estimated Points
Segment Route of Amplifier
No. Segment Miles Presence Sites
Option 1
22A Chicago to Cedar Rapids 255 1 3
22B Cedar Rapids to ▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇ ▇
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ to Omaha 140 1 2
22D Omaha to Topeka
Omaha to Lincoln 80 1 1
Lincoln to Topeka 144 0 2
Sub Total Option 1 739 4 9
Option 1A
21A Chicago to Milwaukee 84 1 1
21B Milwaukee to Green Bay 118 1 1
21C Green Bay to Minneapolis
Green Bay to Eau Claire 190 1 3
Eau Claire to Minneapolis 105 1 1
21D Minneapolis to Des Moines
Minneapolis to Owatonna 104 1 1
Owatonna to ▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇ ▇
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ to Omaha 140 1 2
22D Omaha to Topeka
Omaha to Lincoln 80 1 1
Lincoln to Topeka 144 0 2
Sub Total Option 1A 1,142 8 15
Exhibit G
Regeneration Facility Sites
Estimated Points
Segment Route of Amplifier
No. Segment Miles Presence Sites
Option 2
3 Cincinnati to Louisville 107 1 1
19A Louisville to Nashville
Louisville to Bowling Green 115 1 1
Bowling Green to ▇▇▇▇▇▇▇▇▇ ▇▇ ▇ ▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ to Chattanooga 147 1 2
19C Chattanooga to Atlanta 137 1 2
20A Atlanta to Charlotte
Atlanta to Greenville 155 1 2
Greenville to Charlotte 106 1 1
20B Charlotte to Raleigh
Charlotte to Greensboro 94 1 1
Greensboro to Raleigh 80 1 1
20C Raleigh to Richmond
Raleigh to Rocky Mount 69 1 0
Rocky Mount to Portsmouth 114 1 1
Portsmouth to Richmond 118 1 1
20C Richmond to Washington
Richmond to Fredericksburg 57 1 0
Fredericksburg to Washington 53 0 0
Sub Total Option 2 1,426 13 13
Total (Base System) 10,198 73 119
Total (Base and Option 1) 10,937 77 128
Total (Base and Option 1A) 11,340 81 134
Total (Base, Option 1 and Option 2) 12,363 90 141
Total (Base, Option 1A and Option 2) 12,766 94 147
EXHIBIT G-1
TEMPORARY SPACE WITHIN CERTAIN QWEST FACILITIES
[This exhibit consists of floor plans in graphic format.]
EXHIBIT H
Qwest System 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 IRU Agreement of which this Exhibit forms a part.
1. Maintenance.
-----------
(a) Scheduled Maintenance. Routine maintenance and repair of the
---------------------
Qwest System described in this section ("Scheduled Maintenance") 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 with respect to each Segment upon the effective date of the grant
of the IRU therein, as provided in the IRU 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 the 800 number for Qwest's "Call Before You Dig" program; and
(iv) Assignment of fiber maintenance technicians to locations
along the route of the Qwest System at approximately
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT
-mile intervals
dependent upon terrain and accessibility.
(b) Unscheduled Maintenance. Non-routine maintenance and repair of
-----------------------
the Qwest System which is not included as Scheduled Maintenance ("Unscheduled
Maintenance"), shall be performed by or under the direction of Service Provider.
Unscheduled Maintenance shall commence with respect to each Segment upon the
effective date of the grant of the IRU therein, as provided in the IRU
Agreement. Unscheduled Maintenance shall consist of:
(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 will dispatch personnel
immediately to take corrective action.
2. Operations Center.
-----------------
Service Provider shall operate and maintain a Operations Center ("OC")
staffed twenty-four (24) hours a day, seven (7) days a week by trained and
qualified personnel. 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
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
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 along the system to handle and repair problems
detected in the Qwest System, (i) through the Service Recipient's remote
surveillance equipment and upon notification by Service Recipient to Service
Provider, or (ii) upon notification by a third party.
3. Cooperation and Coordination.
----------------------------
(a) Service Recipient shall utilize an Operations Escalation List, as
updated from time to time, to report and seek immediate initial redress of
exceptions noted in the performance of Service Provider in meeting maintenance
service objectives.
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 notification to Service Recipient. In addition, Service Provider shall
reasonably cooperate with 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 ten (10)
business days prior to the date in connection with any PSWP 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 the previous sentence to
reschedule any delayed activity.
4. Facilities.
----------
(a) Service Provider shall maintain the Qwest System in a manner which
will permit Service Recipient's use, in accordance with the terms and conditions
of the IRU Agreement, of the IRU, the Frontier Fibers and the Associated
Property required to be provided under the terms of the IRU Agreement.
Except to the extent otherwise expressly provided in the IRU
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 the Dark Fibers, none of which is included in the maintenance
services to be provided hereunder.
5. Cable/Fibers.
------------
(a) Service Provider shall perform appropriate Scheduled Maintenance
on the Cable contained in the Qwest System in accordance with Service Provider's
then current preventative maintenance procedures as agreed to by Service
Recipient, which shall not substantially deviate from standard industry
practice.
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 digging within five (5) feet
of the Cable.
(c) Service Provider shall maintain sufficient capability to
teleconference with Service Recipient during an Emergency Unscheduled
Maintenance in order to provide regular communication during the repair process.
When correcting or repairing Cable discontinuity or damage, including but not
limited to in the event of Emergency Unscheduled Maintenance, Service Provider
shall use reasonable efforts to repair traffic-affecting discontinuity within
four (4) hours after the Service Provider maintenance employee's arrival at the
problem site. In order to accomplish such objective, it is acknowledged that
the repairs so effected may be temporary in nature. In such event, within
twenty-four (24) hours after completion of any such Emergency
Unscheduled Maintenance, Service Provider shall commence its planning for
permanent repair, and thereafter promptly shall notify Service Recipient of such
plans, and shall implement such permanent repair within an appropriate time
thereafter. Restoration of open fibers on fiber strands not immediately required
for service shall be completed on a mutually agreed-upon schedule. If the fiber
is required for immediate service, the repair shall be scheduled for the next
available Planned Service Work Period (PSWP).
(d) In performing repairs, Service Provider shall comply with the
splicing specifications as set forth in Exhibit D. Service Provider shall
provide to Service Recipient any modifications to these specifications as may be
necessary or appropriate in any particular instance for Service Recipient's
approval, which approval shall not be unreasonably withheld.
(e) Service Provider's representatives that are responsible for
initial restoration of a cut Cable shall carry on their vehicles the typically
appropriate equipment that would enable a temporary splice, with the objective
of restoring operating capability in as little time as possible. Service
Provider shall maintain and supply an inventory of spare Cable in storage
facilities supplied and maintained by Service Provider at strategic locations to
facilitate timely restoration.
6. Planned Service Work Period (PSWP).
----------------------------------
Scheduled Maintenance which is reasonably expected to produce any
signal discontinuity must be coordinated between the parties. Generally, this
work should be scheduled after midnight and before 6:00 a.m. local time. Major
system work such as fiber rolls and hot cuts will be scheduled for PSWP
weekends. A calendar showing approved PSWP will be agreed upon in the last
quarter of every year for the year to come. The intent is to avoid jeopardy
work on the first and last weekends of the month and high-traffic holidays.
7. Restoration.
-----------
(a) Service Provider shall respond to any interruption of service or a
failure of the Dark Fibers to operate in accordance with the specifications set
forth in Exhibit D (in any event, an "Outage") as quickly as possible (allowing
for delays caused by circumstances beyond the reasonable control of Service
Provider) in accordance with the procedures set forth herein.
When restoring a cut Cable in the Qwest System, the parties agree to
work together to restore all traffic as quickly as possible. Service Provider,
promptly upon arriving on the site of the cut, shall determine the course of
action to be taken to restore the Cable and shall begin restoration efforts.
Service Provider shall splice fibers tube by tube or ribbon by ribbon or fiber
bundle by fiber bundle, rotating between tubes or ribbons operated by the
separate Interest Holders (as defined in paragraph 9(a)), including Service
Recipient, in accordance with the following described priority and rotation
mechanics; provided that, lit fibers in all buffer tubes or ribbons or fiber
--------------
bundles shall have priority over any dark fibers in order to allow transmission
systems to come back on line; and provided further that, Service Provider will
---------------------
continue such restoration efforts until all lit fibers in all buffer tubes or
ribbons are spliced and all traffic
restored. In general, priority among Interest Holders affected by a cut shall be
determined on a rotating restoration-by-restoration and Segment-by-Segment
basis, to provide fair and equitable restoration priority to all Interest
Holders, subject only to such restoration priority to which Qwest is
contractually obligated prior to the date of the Agreement. Service Provider
shall use all reasonable efforts to implement a Qwest System-wide rotation
mechanism on a Segment-by-Segment basis so that the initial rotation order of
the Interest Holders in each Segment is varied (from earlier to later in the
order), such that as restorations occur, each Interest Holder has approximately
equivalent rotation order positions across the Qwest System. Additional
participants in the Qwest System that become Interest Holders after the date
hereof shall be added to the restoration rotation mechanism.
(c) The goal of emergency restoration splicing shall be to restore
service as quickly as possible. This may require the use of some type of
mechanical splice, such as the "3M Fiber Lock" to complete the temporary
restoration. Permanent restorations will take place as soon as possible after
the temporary splice is complete.
8. 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 requirement and procedures set forth herein. The
use of any such subcontractor shall not relieve Service Provider of any of its
obligations hereunder.
9. Fees and Costs.
---------------
(a) Scheduled Maintenance Fees. The fees payable for any and all
--------------------------
Scheduled Maintenance hereunder shall be determined in accordance with the
following provisions. During any time after the Acceptance Date for any Segment
but subject to paragraph 10 below, Qwest shall be the Service Provider and
provide Scheduled Maintenance at a cost not to exceed $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
per route mile per
year, subject to the CPI adjustment described below (the "Qwest Fixed Fee") and
Unscheduled Maintenance as provided in subparagraph 9 below. The Scheduled
Maintenance fee payable by Service Recipient shall be equal to a pro rata share
of Qwest's Costs, based first upon the number of conduits so maintained by Qwest
and included in such Costs and second upon the number of Interest Holders (as
defined in Section 10.4 of the Agreement) in the portion of the Qwest System so
maintained by Qwest and included in such Costs; provided however, the total fee
shall in no event exceed the amount of the Qwest Fixed Fee as adjusted by the
CPI-U Adjustment.
A quarter of the first such Scheduled Maintenance fee with respect to each
Segment will be due and payable thirty (30) days after the Acceptance Date with
respect to such Segment. Thereafter, one quarter of such fee shall be due
quarterly. All fees shall be paid by Service Recipient within thirty (30) days
of receipt of invoice therefor. The Qwest Fixed Fee, if applicable, may be
adjusted annually, in Qwest's sole discretion, beginning with the first
anniversary date of the execution date of this Agreement, for increases in the
United States Bureau of Labor Statistics, CPI-U All Services Index (unadjusted),
as originally published. Said
adjustment shall be hereinafter referred to as "CPI-U Adjustment". Such fee, as
adjusted by the CPI-U Adjustment, shall be equal to the product of the fee
specified herein multiplied by the fraction (i) whose numerator is the CPI-U All
Services for March of the previous calendar year for which the adjustment to the
fee is being made, and (ii) whose denominator is the CPI-U All Services for
March of the preceding year. The adjusted fee shall remain in effect until the
next annual fee is due, when a new adjusted fee fixed pursuant to this provision
shall become effective. In no event shall the amount of the fee as adjusted
pursuant to this provision be less than the amount of fee in effect for the
immediately-preceding year. The parties agree that the Index for March 1995 is
defined as 151.4. In the event that the Bureau of Labor Statistics (or any
successor organization) changes the current base of the CPI-U from 1982-84 =
100, the calculation of a fee under this provision shall be adjusted to ensure
that Qwest receives the same amount as it would have had, had the base not been
changed. In the event the Bureau of Labor Statistics or any successor
organization no longer publishes the CPI-U, Qwest, subject to Service
Recipient's agreement (which shall not be unreasonably withheld), designate the
statistical index it deems most appropriate for calculation of adjustments to a
fee and, from the date the CPI-U ceased to be published, such index shall be
used to make adjustments in a fee under this provision.
On and after the second anniversary of the execution of the Agreement, if
either of FRONTIER or QWEST determines that the Scheduled and Unscheduled
Maintenance to be provided hereunder should be put out to competitive bid
process, then such party shall notify the other of such determination, and
thereafter may obtain at least three bids in writing from national or regional
maintenance providers of sound business and financial reputation to perform the
Scheduled and Unscheduled Maintenance hereunder. Bids for maintenance services
must be for both Scheduled and Unscheduled Maintenance and must be for portions
of the QWEST System covering at least 1,000 contiguous route miles to provide
for the most competitive bidding and the best overall maintenance practices at
the lowest possible cost to Service Recipient. If a majority of the Interest
Holders agree on acceptable bids, QWEST shall be entitled to elect either to
continue to provide the Scheduled and Unscheduled Maintenance, or to subcontract
the Scheduled and Unscheduled Maintenance obligations hereunder to the lowest
such acceptable bidder, in either of which cases the Scheduled Maintenance fee
payable by Service Recipient shall be equal to a pro rata share, based first
upon the number of conduits maintained by QWEST and included in such Costs and
second upon the Interest Holders in the portion of the QWEST System covered by
the bid, of the sum of the lowest acceptable bid price plus a 10% G&A overhead
allowance with QWEST in any such case retaining such overhead allowance.
(b) Unscheduled Maintenance Fees. If the aggregate amount of the
----------------------------
Costs of Unscheduled Maintenance required as a result of any single event or
multiple, closely-related events is less than
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
), such Costs shall be borne
by Service Provider. For any other Unscheduled Maintenance, 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 it utilizes in billing third parties for
reimbursable projects, which costs shall include, without limitation, the
following: (i) labor costs, including wages and salaries, and 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, materials,
supplies, contract services, etc.).
10. Term.
----
Service Provider's obligation to perform maintenance on the relevant
portion of the Qwest System shall be for an initial term expiring
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
, and unless
a different Service Provider is selected by the Interest Holders under a
mutually agreed selection process, then Qwest shall be the Service Provider.
Thereafter, Qwest shall have no obligation to provide Scheduled or Unscheduled
Maintenance hereunder, but shall be entitled to participate in any process
selected by the Interest Holders as a potential Service Provider.
EXHIBIT I
Form of Surety Bond
AIU Insurance Company
American Fidelity Company
American Home Assurance Company
Granite State Insurance Company
Illinois National Insurance Company
The Insurance Company of the State of Pennsylvania
National Union Fire Insurance Company of Pittsburgh, Pa.
New Hampshire Insurance Company
Worldwide Bonding
AMERICAN INTERNATIONAL COMPANIES
Principal Bond ▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇
CONTRACT BOND
KNOW ALL MEN BY THESE PRESENTS:
That ---------------, as Principal, and ---------, as Surety, are held and
firmly bound unto -------, as Obligee, in the sum of ----- Dollars($-----), for
the payment of which sum, well and truly to be made, the Principal and Surety
bind themselves, their heirs, executors, administrators, successors and assigns,
jointly and severally, firmly by these presents.
WHEREAS, The principal has entered into a written contract dated ---------- with
the Obligee for ---------- which contract is by reference made a part hereof.
NOW, THEREFORE, THE CONDITION OF THE ABOVE OBLIGATION IS SUCH, That if the above
bounden Principal shall well and truly keep, do and perform, each and every, all
and singular, the matters and things in said contract set forth and specified to
be by the said Principal kept, done and performed at the time and in the manner
in said contract specified, and shall pay over, make good and reimburse to the
above named Obligee, all loss and damage which said Obligee may sustain by
reason of failure or default on the part of said Principal, then this obligation
shall be void; otherwise, it shall remain in full force and effect.
Signed, sealed and dated ----------
- ----------
(Principal) (Seal)
- -----------
(Witness)
By----------
(Title)
- ----------
(Surety)
Bond No. ----------
By----------
Attorney in Fact
OPERATIVE SURETY LANGUAGE:
NOW, THEREFORE, THE CONDITION OF THE ABOVE OBLIGATION IS SUCH, that if the above
bounden Principal shall well and truly keep, do and perform, each and every, all
and singular, the matters and things in said contract set forth and specified to
be by the said Principal kept, done and performed at the time and in the manner
in said contract specified, and shall pay over, make good and reimburse to the
above named Obligee, those amounts to which Obligee may be entitled under said
contract (including without limitation, Section 18.2 thereof) by reason of
failure or default on the part of said Principal, then this obligation shall be
void; otherwise, it shall remain in full force and effect.
EXHIBIT J
UNDERLYING RIGHTS AND
---------------------
UNDERLYING RIGHTS REQUIREMENTS
------------------------------
Note: Prior to April 6, 1995 Qwest Communications Corporation was known as
"Southern Pacific Telecommunications Company," and the documents listed
below that predate April 6, 1995 are in that former name.
Pueblo Easements:
Easement Agreement dated October 25, 1995 between the Pueblo of Santa ▇▇▇ and
Qwest Communications Corporation.
Easement Agreement dated February 2, 1996 between the Pueblo of Santo ▇▇▇▇▇▇▇
and Qwest Communications Corporation.
Easement Agreement dated February 26, 1996 between the Pueblo of San ▇▇▇▇▇▇ and
Qwest Communications Corporation.
Easement Agreement dated April 12, 1996 between the Pueblo of Isleta and Qwest
Communications Corporation.
Easement Agreement dated June 6, 1996 between the Pueblo of Sandia and Qwest
Communications Corporation.
SPTCo Easement:
Easement Agreement dated September 30, 1991 between Southern Pacific
Transportation Company, as Grantor, and Southern Pacific Telecommunications
Company, as Grantee.
Fifth Amendment to Easement Agreement dated August 9, 1996 between Southern
Pacific Transportation Company, as Grantor, and Qwest Communications
Corporation, as Grantee.
D&RGW Easement:
Easement Agreement dated September 30, 1991 between Denver and Rio Grande
Western Railroad Company, as Grantor, and Southern Pacific Telecommunications
Company, as Grantee.
First Amendment to Easement Agreement dated July 14, 1993 between Denver and Rio
Grande Western Railroad Company, as Grantor, and Southern Pacific
Telecommunications Company, as Grantee.
Second Amendment to Easement Agreement dated May 1, 1995 between Denver and Rio
Grande Western Railroad Company, as Grantor, and Southern Pacific
Telecommunications Company, as Grantee.
SSW Easement:
Easement Agreement dated September 30, 1991 between St. Louis Southwestern
Railway, as Grantor, and Southern Pacific Telecommunications Company, as
Grantee.
Second Amendment to Easement Agreement dated November 16, 1994 between St. Louis
Southwestern Railway, as Grantor, and Southern Pacific Telecommunications
Company, as Grantee.
ATSF Easement
Master Rail Corridor Fiber Optic Agreement dated December 5, 1994 between The
▇▇▇▇▇▇▇▇, Topeka and Santa Fe Railway Company, as Grantor, and Southern Pacific
Telecommunications Company, as Grantee.
CSX Easement:
Fiber Optic Placement Agreement dated as of March 1, 1995 between CSX
Transportation, Inc., as Grantor, and Southern Pacific Telecommunications
Company, as Grantee.
Letter Agreement dated as of March 1, 1995 between CSX Transportation, Inc., as
Grantor, and Southern Pacific Telecommunications Company, as Grantee.
DART Easement:
Fiber Optics Agreement dated as of February 3, 1994 between Dallas Area Rapid
Transit, as Grantor, and Southern Pacific Telecommunications Company, as
Grantee.
First Amendment to Fiber Optics Agreement dated as of November 13, 1995 between
Dallas Area Rapid Transit, as Grantor, and Southern Pacific Telecommunications
Company, as Grantee.
Fiber Optics Easement dated as of December 21, 1994 between Dallas Area Rapid
Transit, as Grantor, and Southern Pacific Telecommunications Company, as
Grantee.
MTA Easement:
(SPTCo Easement Agreement dated September 30, 1991 was assigned as part of sale
of route.)
Amendment to Easement Agreement dated January 13, 1995 between the Los Angeles
County Metropolitan Transportation Authority, as Grantor, and Southern Pacific
Telecommunications Company, as Grantee.
First Severance Agreement and Amendment to Easement Agreement dated June 23,
1995 between Los Angeles County Metropolitan Transportation Authority and
Southern Pacific Telecommunications Company.
Public Easements:
License Agreement dated March 2, 1993 between the Utah Department of
Transportation and Southern Pacific Telecommunications Company.
Agreement dated March 17, 1992 between The Moffat Tunnel Improvement District
and Southern Pacific Telecommunications Company.
License Agreement dated September 11, 1995 between the City and County of
Denver, Board of Water Commissioners and SP Construction Services (covering the
Highline Canal Property).
License Agreement dated August 30, 1995 between the City and County of Denver,
Board of Water Commissioners and SP Construction Services (covering Conduit
Number 55).
License Agreement dated August 30, 1995 between the City and County of Denver,
Board of Water Commissioners and SP Construction Services (covering Conduit
Number 96).
License Agreement No. 95-01-25 dated July 24, 1995 between the City of Aurora,
Director of Utilities and Qwest Communications Corporation.
License Agreement dated August 18, 1995 between the City of Aurora, Director of
Utilities and Qwest Communications Corporation.
Arapahoe County Street Cut and R.O.W. Use Permit Nos. SC5212, SC5213, SC5193,
SC5191, SC5190, SC5194, SC5195, and SC5192 issued to Southern Pacific
Telecommunications Company by Arapahoe County.
Utility Permit Nos. 596067, 595099, 95-145, 95-147, and 95-149 issued to
Southern Pacific Telecommunications Company by the Colorado Department of
Transportation.
Permit for Right-of-Way Use and/or Construction Permit No. 1095 1262 E issued by
SP Construction Services by ▇▇▇▇▇▇▇ County.
Utility Permit Nos. 7528, 7526, and 7525 issued to Qwest Communications
Corporation by the Colorado Department of Transportation.
Permit dated March 3, 1995 issued to SP Telecom Construction Services by the
Huerfano County Road and Bridge Department.
Permit for Construction and Installation of Communication Facilities in Public
Rights of Way (Permit No. TFI-95-002) dated February 21, 1995 issued to
Southern Pacific Telecommunications Company by Las Animas County.
Contractor License No. 70 dated May 9, 1995 issued to Southern Pacific
Telecommunications by the Town of ▇▇▇▇▇▇▇.
Permit dated April 28, 1995 issued to Southern Pacific Telecommunications
Company by the Town of ▇▇▇▇▇▇▇.
Right-of-Way 2983, Book 29, dated March 22, 1995 between the State of Colorado,
State Board of Land Commissioners, as Grantor, and Qwest Communications
Corporation, as Grantee.
Letter dated April 25, 1995 from the City of Trinidad, authorizing SP Telecom to
proceed with construction on the North Linden Avenue Communication Conduits.
Ordinance No. 950310 issued by the City of Kansas City, Missouri, granting
Southern Pacific Telecommunications Company and MCI Telecommunications
Corporation the right to install and maintain underground telecommunication
lines.
Missouri Highway and Transportation Commission Permit Nos. ▇-▇▇-▇▇▇▇▇, 6-95-
00286, ▇-▇▇-▇▇▇▇▇, ▇-▇▇-▇▇▇▇▇, ▇-▇▇-▇▇▇▇▇, ▇-▇▇-▇▇▇▇▇, and ▇-▇▇-▇▇▇▇▇ and
Excavation Permit(s) Receipts.
Private Easements:
Easement dated November 21, 1995 between American Federation of Human Rights, as
Grantor and Qwest Communications Corporation, as Grantee.
Easement dated September 26, 1995 between ▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, as Grantors and Qwest Communications Corporation, as Grantee.
Easement dated December 4, 1995 between ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, as Grantors and Qwest Communications Corporation, as Grantee.
Easement dated March 29, 1995 between ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as
Grantors and Qwest Communications Corporation, as Grantee.
Easement dated March 29, 1995 between Walsenburg Sand and Gravel Company, as
Grantor and Qwest Communications Corporation, as Grantee.
Easement dated March 29, 1995 between ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, as Grantor and Qwest
Communications Corporation, as Grantee.
Easement dated March 30, 1995 between Lindo ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
as Grantors and Qwest Communications Corporation, as Grantee.
Easement dated May 19, 1995 between ▇▇▇▇▇▇ Propane Gas, as Grantor and Qwest
Communications Corporation, as Grantee.
Easement dated March 30, 1995 between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, as Grantor and Qwest
Communications Corporation, as Grantee.
Easement dated April 17, 1995 between ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, as Grantor and Qwest
Communications Corporation, as Grantee.
Easement dated May 15, 1995 between ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, as
Grantors and Qwest Communications Corporation, as Grantee.
Easement between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ (2/19/96), ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (4/17/95),
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (7/17/95), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (4/16/95) and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
(4/16/95), as Grantors and Qwest Communications Corporation, as Grantee.
Easement dated March 30, 1995 between ▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇, as Grantors,
and Qwest Communications Corporation, as Grantee.
Easement dated March 31, 1995 between Trinidad Properties, Inc. and MYBI
Partnership, as Grantors, and Qwest Communications Corporation, as Grantee.
Easement dated June 6, 1995 between ▇▇▇▇ ▇▇▇▇▇, as Grantor, and Qwest
Communications Corporation, as Grantee.
Easement dated May 5, 1995 between ▇▇▇▇▇▇ ▇. Winter and ▇▇▇▇▇ ▇. Winter, as
Grantors, and Qwest Communications Corporation, as Grantee.
Easement dated May 18, 1995 between Ayuda Me Dios, as Grantor, and Qwest
Communications Corporation, as Grantee.
Easement dated April 19, 1995 between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇▇, as
Grantors, and Qwest Communications Corporation, as Grantee.
Easement dated June 1, 1995 between Interstate Underground Warehouse and
Industrial Park, Inc., as Grantor, and Qwest Communications Corporation, as
Grantee.
Easement dated May 26, 1995 between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, as
Grantors, and Qwest Communications Corporation, as Grantee.
Easement dated August 28, 1996 between Red Creek Ranch, Inc., as Grantor and
Qwest Communications, as Grantee (Pueblo, CO).
Miscellaneous Easements
Grant of Right of Way and Easement dated December 20, 1961 between ▇. ▇.
▇▇▇▇▇▇▇▇ and ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, as Grantors, and American Liberty Pipe Line
Company, as Grantee.
Amendment to Right-of-Way Agreement dated April 19, 1994 between ▇▇▇▇▇▇/LICO
Properties II, as Grantor, and Southern Pacific Telecommunications Company, as
Grantee.
Amendment to Right of Way Grant dated January 31, 1996 between Prestonwood Golf
Club Corporation, as Grantor, and Qwest Communications Corporation, as Grantee.
Miscellaneous Documents:
SP Construction Services Safety Manual
Railroad Safety-Rules Governing Contractors Working on Railroads
Railroad Rules and Instructions for Maintenance of Way and Engineering and
Operating Manuals for Southern Pacific Lines
The ▇▇▇▇▇▇▇▇, Topeka and Santa Fe Railway Company Manual
EXHIBIT K
GUARANTY
--------
This GUARANTY, dated as of October 18, 1996, is from FRONTIER CORPORATION,
a New York corporation (hereafter called "Guarantor"), to and for the benefit of
QWEST COMMUNICATIONS CORPORATION, a Delaware corporation (hereafter called
"QWEST").
Recital
-------
FRONTIER COMMUNICATIONS INTERNATIONAL INC. (hereafter called "FCI"), a
wholly-owned subsidiary of Guarantor, entered into a IRU Agreement dated as of
October 18, 1996, by and between QWEST and FCI (the "Agreement"). QWEST would
not have entered into the Agreement except for the request of Guarantor and the
execution and delivery of this Guaranty.
Agreement
---------
NOW, THEREFORE, as a material inducement to QWEST to enter into the
Agreement with FCI and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Guarantor and QWEST hereby
agree as follows:
1. Guaranty. Guarantor hereby unconditionally and irrevocably guaranties
--------
to QWEST the full and punctual payment of all IRU fees payable by FCI pursuant
to the Agreement as set forth in Article II of the Agreement and on the IRU Fee
Payment Schedule attached to the Agreement, and the full and punctual payment of
all other amounts payable by FCI under the Agreement, including the payment of
any interest and all costs and expenses, including reasonable attorneys' fees,
incurred by QWEST in collecting payment or enforcing this Guaranty, pursuant to
the terms of the Agreement (the payment and other obligations are collectively
referred to as the "Obligations").
2. Unconditional Obligations. Guarantor understands and agrees that this
-------------------------
Guaranty is direct, immediate, absolute, continuing, unconditional and
unlimited, and is a guaranty of payment and not of collection. If FCI shall
fail to pay or perform any of the Obligations, Guarantor shall pay, forthwith
upon demand, to QWEST or to QWEST's designated agent, any and all such amounts
as may be due and owning from FCI to QWEST.
3. Guarantor's Waivers. Guarantor waives:
-------------------
(a) notice of the creation or extension of any Obligation by FCI;
(b) notice that FCI has taken or omitted to take any action under the
Agreement or any other instrument relating thereto or relating to any
Obligation;
(c) notice of acceptance of this Guaranty;
(d) demand, presentation for payment and notice of demand, nonpayment
or nonperformance;
(e) any and all right to participate in any security held by QWEST now
or in the future;
(f) the right to require QWEST to (i) proceed against FCI, (ii)
proceed against or exhaust any security which QWEST now holds or may hold in the
future from FCI; (iii) pursue any other right or remedy available to QWEST, or
(iv) have the property of FCI first applied to the discharge of the Obligations;
and
(g) any defense by reason of bankruptcy, reorganization, discharge by
the filing of bankruptcy or discharge in bankruptcy of FCI;
Guarantor further agrees that the Guaranty will not be discharged and shall
remain in full force and effect until full payment and performance of all
Obligations of FCI and the liabilities of Guarantor hereunder.
4. Guarantor's Representations and Warrants. Guarantor represents and
----------------------------------------
warrants that:
(a) any financial information provided by Guarantor to QWEST was
prepared in accordance with generally accepted accounting principles and
accurately and fairly represents the financial condition on the date stated and
understands QWEST is relying on such information; and
(b) Guarantor has a financial interest in FCI.
5. Consent. Guarantor understands and consents that from time to time,
-------
and without further notice to or consent of Guarantor, QWEST may take any or all
of the following actions without releasing, discharging or in any way affecting
the obligations of Guarantor under this Guaranty:
(a) extend, renew, modify, compromise, settle, or release the
Obligations;
(b) any modification or amendment of or supplement to the Agreement;
(c) release or compromise any liability of any party or parties with
respect to the Obligations; or
(d) exercise or refrain from exercising any right or remedy of QWEST
under the Agreement.
6. Assignment. Guarantor understands and agrees that any assignment of
----------
the Agreement, or any rights or obligations accruing thereunder, shall in no way
affect Guarantor's obligations under this Guaranty.
7. Delay in Enforcement. Guarantor understands and agrees that any
--------------------
failure or delay of QWEST to enforce any of its rights under the Agreement or
this Guaranty shall in no way affect Guarantor's obligations under this
Guaranty.
8. Notices. Notices to Guarantor are not required under this Guaranty.
-------
However, if notice is delivered, unless otherwise provided herein, it shall be
hand delivered, sent by registered or certified U.S. mail, postage prepaid, or
by commercial overnight delivery service, or transmitted by facsimile, and shall
be deemed served or delivered to Guarantor when received at the address set
forth after the signature line below, upon confirmation of sending when sent by
fax, on the day after being sent when sent by overnight delivery service, or
three (3) days after deposit in the mail when sent by U.S. mail.
9. Severability. In case any provision of this Guaranty shall be invalid,
------------
illegal or unenforceable, such provision shall be severable from the rest of
this Guaranty and the validity, legality or enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
10. Applicable Law and Jurisdiction. This Guaranty and the rights and
-------------------------------
obligations of the parties hereto shall be governed by and construed and
enforced in accordance with the laws of the state of New York. Guarantor agrees
that the exclusive venue for any actions related to this Guaranty shall be the
Federal District Court for the New York or in the alternative the courts of
Monroe County, New York.
11. Amendments. No amendment, modification or alteration of this Guaranty
----------
shall be effective unless in writing and signed by the parties hereto or their
respective successors or assigns.
12. Successors and Assigns. This Guaranty shall be binding upon and shall
----------------------
inure to the benefit of the successors and assigns of the parties hereto.
13. Attorneys' Fees. If any action shall be instituted by either QWEST or
---------------
Guarantor for the enforcement or interpretation of any of its rights, remedies
or obligations in or under this Guaranty, the prevailing party shall be entitled
to recover from the losing party all costs incurred by the prevailing party in
such action and any appeal therefrom, including reasonable attorneys' fees and
court costs to be fixed by the court therein.
THIS GUARANTY IS FREELY AND VOLUNTARILY GIVEN WITHOUT ANY DURESS OR
COERCION AND AFTER GUARANTOR HAS EITHER CONSULTED WITH COUNSEL, OR HAS BEEN
GIVEN AN OPPORTUNITY TO DO SO, AND GUARANTOR HAS CAREFULLY AND COMPLETELY READ
ALL OF THE TERMS AND PROVISIONS OF THE AGREEMENT AND THIS GUARANTY.
IN WITNESS WHEREOF, this Guaranty has been executed as of the date first
above written.
GUARANTOR:
FRONTIER CORPORATION, a New York
corporation
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
___________________________________
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President
Guarantor's Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn.: Vice President
__________________________________
Network Planning and Development
EXHIBIT L
GUARANTY
--------
This GUARANTY, dated as of October 18, 1996, is from ANSCHUTZ COMPANY, a
Delaware corporation (hereafter called "Guarantor"), to and for the benefit of
FRONTIER COMMUNICATIONS INTERNATIONAL INC., a Delaware corporation (hereafter
called "FCI").
Recital
-------
QWEST COMMUNICATIONS CORPORATION (hereafter called "QWEST"), a wholly-owned
subsidiary of Guarantor, entered into a IRU Agreement dated as of October 18,
1996, by and between QWEST and FCI (the "Agreement"). FCI would not have
entered into the Agreement except for the request of Guarantor and the execution
and delivery of this Guaranty.
Agreement
---------
NOW, THEREFORE, as a material inducement to FCI to enter into the Agreement
with QWEST and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor and FCI hereby agree as
follows:
1. Guaranty. Guarantor hereby unconditionally and irrevocably guaranties
--------
to FCI the full and punctual payment of all amounts payable by QWEST to FCI
under the Agreement, including, without limitation, Section 18.2 thereof (such
payment obligations are collectively referred to as the "Obligations").
2. Unconditional Obligations. Guarantor understands and agrees that this
-------------------------
Guaranty is direct, immediate, absolute, continuing, unconditional and unlimited
(except as provided in Section 14), and is a guaranty of payment and not of
collection. If QWEST shall fail to pay or perform any of the Obligations,
Guarantor shall pay, forthwith upon demand, to FCI or to FCI's designated agent,
any and all such amounts as may be due and owning from QWEST to FCI.
3. Guarantor's Waivers. Guarantor waives:
-------------------
(a) notice of the creation or extension of any Obligation by QWEST;
(b) notice that QWEST has taken or omitted to take any action under
the Agreement or any other instrument relating thereto or relating to any
Obligation;
(c) notice of acceptance of this Guaranty;
(d) demand, presentation for payment and notice of demand, nonpayment
or nonperformance;
(e) any and all right to participate in any security held by FCI now
or in the future;
(f) the right to require FCI to (i) proceed against QWEST, (ii)
proceed against or exhaust any security which FCI now holds or may hold in the
future from QWEST; (iii) pursue any other right or remedy available to FCI, or
(iv) have the property of QWEST first applied to the discharge of the
Obligations; and
(g) any defense by reason of bankruptcy, reorganization, discharge by
the filing of bankruptcy or discharge in bankruptcy of QWEST.
Guarantor further agrees that the Guaranty will not be discharged and shall
remain in full force and effect until the earlier to occur of (a) full payment
and performance of all Obligations of QWEST and the liabilities of Guarantor
hereunder, or (b) substitution of the Surety Bond (as defined in and pursuant to
Section 3.5 of the Agreement), in which case this Guaranty shall terminate as
provided in Section 15 hereof.
4. Guarantor's Representations and Warrants. Guarantor represents and
----------------------------------------
warrants that Guarantor has a financial interest in QWEST.
5. Consent. Guarantor understands and consents that from time to time,
-------
and without further notice to or consent of Guarantor, FCI may take any or all
of the following actions without releasing, discharging or in any way affecting
the obligations of Guarantor under this Guaranty:
(a) extend, renew, modify, compromise, settle, or release the
Obligations;
(b) any modification or amendment of or supplement to the Agreement;
(c) release or compromise any liability of any party or parties with
respect to the Obligations; or
(d) exercise or refrain from exercising any right or remedy of FCI
under the Agreement.
6. Assignment. Guarantor understands and agrees that any assignment of
----------
the Agreement, or any rights or obligations accruing thereunder, shall in no way
affect Guarantor's obligations under this Guaranty.
7. Delay in Enforcement. Guarantor understands and agrees that any
--------------------
failure or delay of FCI to enforce any of its rights under the Agreement or this
Guaranty shall in no way affect Guarantor's obligations under this Guaranty.
8. Notices. Notices to Guarantor are not required under this Guaranty.
-------
However, if notice is delivered, unless otherwise provided herein, it shall be
hand delivered, sent by registered or certified U.S. mail, postage prepaid, or
by commercial overnight delivery service, or transmitted by facsimile, and shall
be deemed served or delivered to Guarantor when received at the address set
forth after the signature line below, upon confirmation of sending when sent by
fax, on the day after being sent when sent by overnight delivery service, or
three (3) days after deposit in the mail when sent by U.S. mail.
9. Severability. In case any provision of this Guaranty shall be invalid,
------------
illegal or unenforceable, such provision shall be severable from the rest of
this Guaranty and the validity, legality or enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
10. Applicable Law and Jurisdiction. This Guaranty and the rights and
-------------------------------
obligations of the parties hereto shall be governed by and construed and
enforced in accordance with the laws of the state of Colorado. Guarantor agrees
that the exclusive venue for any actions related to this Guaranty shall be the
federal district court of Colorado.
11. Amendments. No amendment, modification or alteration of this Guaranty
----------
shall be effective unless in writing and signed by the parties hereto or their
respective successors or assigns.
12. Successors and Assigns. This Guaranty shall be binding upon and shall
----------------------
inure to the benefit of the successors and assigns of the parties hereto.
13. Attorneys' Fees. If any action shall be instituted by either FCI or
---------------
Guarantor for the enforcement or interpretation of any of its rights, remedies
or obligations in or under this Guaranty, the prevailing party shall be entitled
to recover from the losing party all costs incurred by the prevailing party in
such action and any appeal therefrom, including reasonable attorneys' fees and
court costs to be fixed by the court therein.
14. Limited Maximum Liability. Notwithstanding anything contained herein
-------------------------
to the contrary, the liability of Guarantor for the payment of the Obligations
shall be limited to the aggregate sum of $175,000,000.
15. Termination. Notwithstanding anything contained herein to the
-----------
contrary, this Guaranty and the Obligations of Guarantor hereunder shall
terminate and be of no further force and effect automatically and without
further action on the part of any person upon delivery of the Surety Bond (as
defined in and pursuant to Section 3.5 of the Agreement) to FRONTIER. Upon such
termination, FRONTIER shall return to Guarantor the original of this Guaranty
marked Discharged and Terminated.
THIS GUARANTY IS FREELY AND VOLUNTARILY GIVEN WITHOUT ANY DURESS OR
COERCION AND AFTER GUARANTOR HAS EITHER CONSULTED
WITH COUNSEL, OR HAS BEEN GIVEN AN OPPORTUNITY TO DO SO, AND GUARANTOR HAS
CAREFULLY AND COMPLETELY READ ALL OF THE TERMS AND PROVISIONS OF THE AGREEMENT
AND THIS GUARANTY.
IN WITNESS WHEREOF, this Guaranty has been executed as of the date first
above written.
GUARANTOR:
ANSCHUTZ COMPANY, a Delaware corporation
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_________________________________________
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Guarantor's Address:
2400 Anaconda Tower
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: President
Agreement
This Agreement is made on May 1 , 1997, by and
between QWEST COMMUNICATIONS CORPORATION ("QWEST") and FRONTIER
COMMUNICATIONS INTERNATIONAL INC. ("FRONTIER") (collectively referred
to as the "Parties").
Recitals
A. QWEST and FRONTIER are parties to an IRU Agreement dated as
of October 18, 1996 (the "FRONTIER IRU") regarding FRONTIER's right to
use twenty four (24) dark fibers comprising a part of a continuous
fiberoptic communications system being constructed by QWEST (the
"QWEST System").
B. Pursuant to Section 1.4 of the FRONTIER IRU, FRONTIER was
granted a right to acquire the right to use an additional twenty four
(24) dark fibers in the QWEST System.
C. In lieu of exercising its rights under Section 1.4 of the
FRONTIER IRU, FRONTIER has entered into negotiations with QWEST and
GTE Intelligent Network Services, Inc. ("GTE") whereby GTE will
acquire the right to use twenty four (24) dark fibers in the QWEST
System pursuant to an IRU agreement with QWEST (the "GTE IRU").
D. Pursuant to the GTE IRU, GTE agrees to pay QWEST $
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
per route mile of the QWEST System (the "GTE IRU Fee").
E. The Parties desire to address their mutual rights and
obligations with regard to the GTE IRU, the GTE IRU Fee and other
aspects of their relationship under the FRONTIER IRU.
Agreement
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, the Parties agree as follows:
1. Definitions. All capitalized terms in this Agreement which are
not otherwise defined herein shall have the meaning given to them in
the FRONTIER IRU.
2. Payment of GTE IRU Fee. The GTE IRU Fee shall be divided between
the Parties, as follows:
2.1 Allocation of GTE IRU Fee. The GTE IRU Fee of
$
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
shall be paid to QWEST in periodic installments as
provided in the GTE IRU. Out of each such payment, QWEST shall retain
##MATERIAL OMITTED AND SEPARATELY FILED UNDER AN APPLICATION FOR
CONFIDENTIAL TREATMENT##
% and the remaining amount shall be treated as a reduction in
the Frontier IRU fee and shall be credited against any amounts due to
QWEST from FRONTIER pursuant to the FRONTIER IRU. The allocation
provided for in this paragraph shall pertain only to the GTE IRU Fee
set forth above and shall not be applicable to payments received by
QWEST under the GTE IRU for regeneration and terminal facilities or
maintenance costs or other costs not associated with GTE's IRU in 24
fibers in QWEST's 12,766 mile network.
3. Contingencies. The obligations of the Parties under this
Agreement are contingent upon the execution of the GTE IRU by GTE and
QWEST and the approval thereof by FRONTIER, which approval shall not
be unreasonably withheld. Prior to executing the GTE IRU, QWEST shall
provide a complete copy thereof to FRONTIER with a notice stating the
date upon which the GTE IRU will be executed. At any time prior to
the execution date, FRONTIER may give notice of any objection to the
terms of such agreement which materially affect the compensation to be
received by FRONTIER from the GTE IRU or the Obligations being
guaranteed by FRONTIER under such agreement. The failure of FRONTIER
to give timely notice of an objection shall constitute approval of the
GTE IRU by FRONTIER. If notice of an objection is timely given and if
the Parties fail to resolve or remove the objection within twenty (20)
days of the date of such notice, this Agreement shall be void.
4. Satisfaction of Fiber Obligation. The parties hereby agree that
the payments credited to FRONTIER under paragraph 2.1 of this
Agreement shall fully and completely satisfy any and all obligations
of the parties with respect to the fiber adjustment provided for under
Section 2.2(a) of the FRONTIER IRU.
5. Miscellaneous
5.1 Severability. In case any provision of this Agreement
is found to be invalid, illegal or unenforceable, such provision shall
be severable from the rest of this Agreement and the validity,
legality or enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
5.2 Dispute Resolution. This Agreement and the rights and
obligations of the Parties shall be governed by and construed and
enforced, and all disputes between the Parties shall be resolved, in
accordance with Articles XXI and XXIII of the FRONTIER IRU.
5.3 Amendments. No amendment, modification or alteration
of this Agreement shall be effective unless in writing and signed by
the Parties or their respective successors or assigns.
5.4 Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the successors and
permitted assigns of the Parties.
5.5 Attorneys' Fees. If any action shall be instituted by
either QWEST or FRONTIER for the enforcement or interpretation of any
of its rights, remedies or obligations in or under this Agreement, the
prevailing party shall be entitled to recover from the losing party
all costs incurred by the prevailing party in such action and any
appeal therefrom, including reasonable attorneys' fees and court costs
to be fixed by the court therein.
5.6 Assignment. Neither of the Parties may assign any of
its rights or obligations under this Agreement without the prior
written consent of the other party, which consent will not
unreasonably be withheld or delayed.
5.7 Notices. Any notice permitted or required under this
Agreement shall be given in accordance with Article XVI of the
FRONTIER IRU.
5.8 Release of Option. FRONTIER hereby waives and releases
any options or rights under Section 1.4 of the FRONTIER IRU.
5.9 Termination. Unless otherwise agreed by the Parties,
in writing, his Agreement shall terminate if the contingency expressed
in Section 3 has not been satisfied within six (6) months of the date
hereof.
QWEST COMMUNICATIONS CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior V.P.-NBD
FRONTIER COMMUNICATIONS INTERNATIONAL INC
By: /s/
VP Network Engineering