EXHIBIT 99.1
CONFIDENTIAL SETTLEMENT MATERIALS
PROTECTED BY DELAWARE RULE EVID.
408
SPRINT/UBIQUITEL FORBEARANCE
AGREEMENT
THIS FORBEARANCE AGREEMENT, dated
July 29, 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., and Sprint PCS License, L.L.C. (collectively,
“Sprint”) and UbiquiTel Inc. and UbiquiTel Operating
Company (collectively, “UbiquiTel”).
RECITALS
A.
UbiquiTel Operating Company and Sprint Spectrum L.P., Sprint
Communications Company L.P., WirelessCo L.P., Sprint Telephony PCS,
L.P. and Sprint PCS License, L.L.C. are parties to the Sprint PCS
Management Agreement, dated as of October 15, 1998, as amended
(the “Management Agreement”).
B.
On July 12, 2005, UbiquiTel filed a complaint (the
“Complaint”) in the Court of Chancery of the State of
Delaware against Sprint and Nextel Communications, Inc.
(“Nextel”), alleging that certain activities following
the anticipated merger involving Sprint Corporation and Nextel (the
“Sprint Nextel Merger”) will violate the exclusivity
provisions of the Management Agreement and that Nextel improperly
interfered with UbiquiTel’s exclusive rights under the
Management Agreement. The Complaint seeks, among other
things, (i) a court order requiring Sprint (together with
Nextel) to comply with the exclusivity provisions of the Management
Agreement and prohibiting Sprint (together with Nextel) from
violating those provisions and (ii) damages caused by the
alleged conduct.
C.
The parties are entering into this Agreement to set forth
UbiquiTel’s agreement not to seek certain injunctive relief
under certain circumstances 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:
“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, UbiquiTel
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.
“Existing Litigation”
means all litigation specified in the Complaint.
“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 the Management Agreement.
“Sprint PCS Affiliate”
means Manager and the Other Managers.
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“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)).
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 UbiquiTel 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 minimus amounts that do not have a
detrimental competitive impact on UbiquiTel’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 UbiquiTel upon
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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 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 UbiquiTel, 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 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 transferring from CDMA Products and Services to iDEN
Products and Services.
(d)
Subscriber and Financial Data . UbiquiTel-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 UbiquiTel to
Sprint (or otherwise generated by Sprint or any other party and
relating to UbiquiTel) 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
UbiquiTel-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 UbiquiTel’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 UbiquiTel-specific
information.
(e)
Network Performance. Sprint will not allow network
performance data and Format C reports provided by UbiquiTel to
Sprint (or otherwise generated by Sprint or any other party and
relating to UbiquiTel) 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
UbiquiTel-specific information. However, Sprint will be
permitted to use Format C reports provided by
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UbiquiTel (or otherwise generated by Sprint and
relating to UbiquiTel) 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 UbiquiTel to
Sprint (or otherwise generated by Sprint or any other party and
relating to UbiquiTel) 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 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 UbiquiTel-specific
information.
(g)
Business Forecasts. Sprint will not allow business
forecast data provided by UbiquiTel to Sprint (or otherwise
generated by Sprint or any other party and relating to UbiquiTel)
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 UbiquiTel-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 UbiquiTel
and the CDMA service of national accounts headquartered in the
Service Area shall continue to be serviced by Sprint and UbiquiTel
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 UbiquiTel 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”
