SPRINT/SHENANDOAH FORBEARANCE AGREEMENT Exhibit 99.1

 

 

                                               CONFIDENTIAL SETTLEMENT MATERIALS

                                             PROTECTED BY FEDERAL RULE EVID. 408

                                                     AND DELAWARE RULE EVID. 408

 

SPRINT/SHENANDOAH FORBEARANCE AGREEMENT                             Exhibit 99.1

 

      THIS FORBEARANCE AGREEMENT, dated August 9, 2005 (this "Agreement"), is

made and entered into by and among Sprint Corporation, Sprint Spectrum L.P.,

WirelessCo L.P., Sprint Communications Company L.P., Sprint Telephony PCS, L.P.,

APC PCS, LLC, PhillieCo, L.P., and Sprint PCS License, L.L.C. (collectively,

"Sprint"); and Shenandoah Personal Communications Company (the "Affiliate").

 

                                    RECITALS

 

      A. Affiliate and certain of the Sprint entities referenced above are

parties to a Sprint PCS Management Agreement, dated as of November 5, 1999, as

amended (the "Management Agreement").

 

      B. On December 15, 2004, Sprint Corporation, Nextel Communications, Inc.

("Nextel") and S-N Merger Corp. entered into an Agreement and Plan of Merger,

pursuant to which Nextel will merge and into S-N Merger Corp. and become a

wholly owned subsidiary of Sprint Corporation (the "Sprint Nextel Merger").

 

      C. The parties are entering into this Agreement to set forth the

Affiliate's agreement to forbear from pursuing claims against Sprint and its

Subsidiaries and Related Parties during the period of time that this Agreement

remains in effect and not to seek certain injunctive relief under certain

circumstances during the period of time that this Agreement remains in effect

and to outline certain actions not to be taken by Sprint and its Subsidiaries

and Related Parties following the completion of the Sprint Nextel Merger during

the period of time that this Agreement remains in effect.

 

      D. On the date of the Sprint Nextel Merger, Nextel will become a

subsidiary of Sprint Corporation, and Sprint Corporation will change its name to

"Sprint Nextel Corporation." The terms "Sprint Corporation" and "Sprint" as used

in this Agreement will also refer to Sprint Nextel Corporation following the

Sprint Nextel Merger.

 

                                    AGREEMENT

 

      In consideration of the recitals and mutual covenants and agreements

contained in this Agreement, the sufficiency of which consideration is hereby

acknowledged, the parties, intending to be bound, agree as follows:

 

                                   ARTICLE I

 

                                   DEFINITIONS

 

      Section 1.1 Certain Definitions. The following terms are used in this

Agreement with the meanings assigned below:

 

<PAGE>

 

      "Affiliate Group" means employees of Sprint Corporation and its

Subsidiaries who are housed in and work out of (a) the Affiliate Relations

Group, (b) the Affiliate/PLS-Plan & Strategy Group or (c) the

Affiliate/PLS-Client Service/Technology Group, each as currently structured

within Sprint Corporation. For purposes of clarification, each of the groups

currently reports to David Bottoms, Vice President-Strategic Partners. The term

"Affiliate Group" also refers to any successor group of employees to those

groups referenced above that may result from any internal management

restructuring within Sprint Corporation and its Subsidiaries or Related Parties.

 

      "CDMA Customers" means subscribers of products and services offered by

Sprint PCS and Sprint PCS Affiliates using the CDMA Network whose account is

assigned to the Service Area.

 

      "CDMA Network" means the national wireless network owned and operated by

Sprint, the Affiliate and the other Sprint PCS Affiliates providing services

using code division multiple access technology.

 

      "CDMA Products and Services" means products and services operating on the

CDMA Network.

 

      "iDEN Customers" means Nextel customers located in the Service Area who

are using iDEN Products and Services.

 

      "iDEN Network" means the national integrated digital enhanced network

owned and operated by Nextel and its Related Parties on the date of the Sprint

Nextel Merger.

 

      "iDEN Products and Services" means Nextel products and services operating

on the iDEN Network.

 

      "Local Media" means (a) a print publication that is primarily distributed

within the Service Area, (b) a radio or television station that primarily

broadcasts into the Service Area or (c) a billboard or other physical

advertising presence in the Service Area.

 

      "Service Area" has the meaning set forth in the Management Agreement,

which for the avoidance of doubt shall mean the aggregate of the Service Area

defined and described in each of the Management Agreement.

 

      "Sprint PCS Affiliate" means the Affiliate and the Other Managers.

 

      "Subsidiary" of any Person as of any relevant date means any corporation

or other entity of which such Person owns or controls, directly or indirectly, a

majority of the outstanding voting securities or other ownership interests,

provided that Nextel Partners, Inc. will not be deemed a Subsidiary of Sprint

for purposes of this Agreement until Sprint or any of its Related Parties at any

time owns or controls, directly or indirectly, 50% or more of the voting

securities or other ownership interests of Nextel Partners (as defined in

Section 2.10(a)).

 

 

                                      -2-

<PAGE>

 

      Section 1.2 Management Agreement. Capitalized terms used but not defined

herein have the meanings assigned to them in the Management Agreement.

 

                                   ARTICLE II

 

                               COVENANTS BY SPRINT

 

      Section 2.1 Preservation of Confidential Information.

 

            (a) Marketing. Sprint will not allow any proposed marketing and

advertising campaign materials, proposed service plans, or proposed credit

policies provided by the Affiliate to Sprint to be reviewed by employees of

Sprint Corporation and its Subsidiaries or Related Parties other than the

Affiliate Group and employees with direct responsibility for implementing such

materials, plans or policies and/or reviewing such materials, plans or policies

for compliance with the Trademark License Agreements, the Marketing

Communication Guidelines or other applicable provisions of the Management

Agreement (who will not use the information for any other purpose).

 

            (b) Billing. Sprint will not (i) make billing systems containing

data relating to CDMA Customers (e.g., Convergis/P2K) available to employees of

Sprint Corporation or its Subsidiaries or Related Parties in any retail store

location, sales channel, sales office (except national account managers who do

not directly engage in marketing or sales efforts with national accounts

headquartered in the Service Area for iDEN Products and Services in the Service

Area) or administrative office that offers, supports or is involved with iDEN

Products and Services in the Service Area, and agrees not to share any such data

with any such employees, or (ii) provide any billing inserts or similar types of

communications reflecting or otherwise referring to the Sprint Nextel Merger or

any resulting brand change to CDMA Customers or iDEN Customers in the Service

Area that are designed to induce or encourage, or could reasonably be expected

to induce or encourage, CDMA Customers to switch to iDEN Products and Services

(except for de minimis amounts that do not have a detrimental competitive impact

on the Affiliate's business).

 

            (c) Customer Care and Telemarketing. (i) Sprint will maintain a

process of identifying and directing to designated customer service

representatives CDMA Customers and iDEN Customers who call Sprint for customer

care services. Any CDMA Customer mistakenly directed to a customer care

representative designated to service iDEN Customers will be transferred to a

customer care representative designated to service CDMA Customers. Any iDEN

Customer mistakenly directed to a customer care representative designated to

service CDMA Customers will be transferred to a customer care representative

designated to service iDEN Customers. Sprint agrees to make the details of such

process available to the Affiliate upon request. Notwithstanding the foregoing,

Sprint will have certain customer care representatives who are permitted to

access information regarding both CDMA Customers and iDEN Customers for the sole

purpose of serving customers who use both CDMA Products and Services and iDEN

Products and Services so long as such customer care representatives are not

engaged in marketing or selling iDEN Products and Services to CDMA Customers.

Customer care representatives shall be permitted to make arrangements to provide

either iDEN or CDMA

 

 

                                      -3-

<PAGE>

 

handsets, upon request, to existing CDMA Customers and existing iDEN Customers

requesting them.

 

                  (ii) Any customer care representative advised that a CDMA

Customer desires to terminate its use of CDMA Products and Services will first

seek to convince such CDMA Customer to continue its use of CDMA Products and

Services. If such efforts are unsuccessful, the representative may seek to sell

iDEN Products and Services to such customers. The converse process will apply

for any iDEN Customer seeking to terminate its use of iDEN Products and

Services. Sprint agrees to provide to the Affiliate, at least as frequently as

current practice (or, if there is no such current practice, at least every two

weeks), a detailed report setting forth the CDMA Customers in the Service Area

who have terminated the use of CDMA Products and Services and have purchased

iDEN Products and Services.

 

                  (iii) Sprint and its Subsidiaries will not waive or reduce

termination fees as compared to current levels in order to facilitate any CDMA

Customer in the Service Area transferring from CDMA Products and Services to

iDEN Products and Services.

 

            (d) Subscriber and Financial Data. Affiliate-specific information in

Sprint's EMIS System (or any successor system) will only be able to be accessed

by the Affiliate Group. Other subscriber and financial information provided by

the Affiliate to Sprint (or otherwise generated by Sprint or any other party and

relating to the Affiliate) will only be available to the Affiliate Group and

other employees and consultants of Sprint Corporation and its Related Parties in

the ordinary course of business consistent with past practice, unless such

information is aggregated with subscriber and financial information of the other

Sprint PCS Affiliates on a basis that does not permit identification of the

Affiliate-specific information; provided that in no event will any such

information be used by any such employee or consultant in a manner that

adversely affects the competitive position of the CDMA Products and Services in

relation to the iDEN Products and Services in the Service Area. Sprint will not

make any external or public disclosure of the Affiliate's subscriber and

financial information, unless such information is aggregated with subscriber and

financial information of the other Sprint PCS Affiliates on a basis that does

not permit identification of the Affiliate-specific information.

 

            (e) Network Performance. Sprint will not allow network performance

data and Format C reports provided by the Affiliate to Sprint (or otherwise

generated by Sprint or any other party and relating to the Affiliate) to be

reviewed by employees of, or consultants to, Sprint Corporation and its

Subsidiaries or Related Parties other than the Affiliate Group and employees

whose function relates primarily to CDMA Network performance (who will not use

the information for any other purpose), unless such information is aggregated

with information from the other Sprint PCS Affiliates on a basis that does not

permit identification of the Affiliate-specific information. However, Sprint

will be permitted to use Format C reports provided by the Affiliate (or

otherwise generated by Sprint and relating to the Affiliate) to update coverage

maps and to disclose such coverage maps consistent with past practice.

 

            (f) Handset Logistics. Sprint will not allow handset logistical data

and related forecasts provided by the Affiliate to Sprint (or otherwise

generated by Sprint or any other party and relating to the Affiliate) to be

reviewed and used by employees of, or consultants to, Sprint Corporation and its

Subsidiaries or Related Parties other than the Affiliate Group and employees

 

 

                                      -4-

<PAGE>

 

whose function relates primarily or is necessary to the procurement of handsets

(who will not use the information for any other purpose), unless such

information is aggregated with handset logistical data and related forecasts of

the other Sprint PCS Affiliates on a basis that does not permit identification

of the Affiliate-specific information.

 

            (g) Business Forecasts. Sprint will not allow business forecast data

provided by the Affiliate to Sprint (or otherwise generated by Sprint or any

other party and relating to the Affiliate) to be reviewed by employees of, or

consultants to, Sprint Corporation and its Subsidiaries or Related Parties other

than the Affiliate Group and employees who need to have such information for

operational reasons (e.g., determining capacity needs for shared network

elements), who will not use the information for any other purpose. However, such

data may be reviewed by other employees after it has been aggregated with data

of the other Sprint PCS Affiliates on a basis that does not permit

identification of the Affiliate-specific information.

 

            (h) Business Accounts Data. Sprint will not share any information

regarding CDMA Customers' business accounts with any consultants or with any

employees other than the Affiliate Group and employees who need to have such

information for operational reasons (and who will not use the information for

any other purpose). All CDMA Customers' business accounts (other than national

accounts) shall only be serviced by the Affiliate, and the CDMA service of

national accounts headquartered in the Service Area shall continue to be

serviced by Sprint and the applicable Affiliate consistent with past practice.

 

      Section 2.2 CDMA Products and Services. Sprint and its Subsidiaries will

not use the iDEN Network in the Service Area or any spectrum in the Service Area

owned by Nextel or its Subsidiaries to provide CDMA Products and Services. For

purposes of clarification, the parties intend the above provision to apply

(without limitation) to the G block 1.9 GHz spectrum to be obtained by Nextel,

in addition to Nextel's other spectrum.

 

      Section 2.3 Dual Mode Handsets. Sprint and its Subsidiaries will not offer

or sell, directly or indirectly, any dual mode CDMA/iDEN handsets in the Service

Area, nor will Sprint or its Subsidiaries offer or sell, directly or indirectly,

any dual mode CDMA/iDEN handsets in any areas nationwide other than the Service

Area unless such handsets are programmed to use the Affiliate's CDMA Network in

the Service Area on the first priority basis prior to using the iDEN Network in

the Service Area (i.e., all such handsets shall "prefer" the Affiliate's CDMA

Network).

 

      Section 2.4 Distribution. Sprint will not, and will not permit any of its

Subsidiaries to, sell CDMA Products and Services in the Service Area in any

retail store locations owned or operated by Sprint, Nextel or any of their

Subsidiaries, agent retail stores controlled by Sprint, Nextel or any of their

Subsidiaries or through business sales representatives (other than with respect

to national accounts, who are subject to Section 2.8) employed by Sprint, Nextel

or any of their Subsidiaries (collectively, "Nextel Distribution Points").

Sprint will not, and will not permit any of its Subsidiaries to, sell CDMA

Products and Services through national retailers in the Service Area other than

through its National Distribution Program provided for in Section 4.1 of the

Management Agreement. Sprint will implement mechanisms whereby users accessing

any website operated by Sprint will first encounter an opening page that will

give the user the option to select CDMA Products and Services or iDEN Products