Exhibit 99D
PARENTS AGREEMENT
This PARENTS AGREEMENT (the "Agreement") is entered into as of the 31st
day of January, 1996, by TELE-COMMUNICATIONS, INC., a Delaware
corporation ("TCI Parent") and SPRINT CORPORATION, a Kansas corporation
("Sprint Parent").
WHEREAS, subsidiaries of each of TCI Parent, Sprint Parent, Xxx
Communications, Inc., a Delaware corporation ("Cox Parent"), and Comcast
Corporation, a Pennsylvania corporation ("Comcast Parent", and together
with Cox Parent and TCI Parent, the "Cable Parents") (such subsidiaries,
the "Partners") have entered into that certain Agreement of Limited
Partnership of MajorCo, L.P., dated as of March 28, 1995, as amended by
that certain First Amendment to Agreement of Limited Partnership, dated
as of August 31, 1995 (the "Prior Partnership Agreement"), pursuant to
which MajorCo, L.P., a Delaware limited partnership ("MajorCo") was
formed;
WHEREAS, as of the date hereof, the Partners are further amending the
Prior Partnership Agreement and restating it in its entirety (as so
amended and restated, the "Partnership Agreement") and, in connection
therewith, each Cable Parent has agreed to make certain undertakings to
Sprint Parent, and Sprint Parent has agreed to make certain undertakings
to each Cable Parent.
NOW, THEREFORE, in consideration of the mutual promises and agreements
of the parties, and other good and valuable consideration the receipt of
which is hereby acknowledged, Sprint Parent and TCI Parent do hereby
agree as follows:
SECTION 1. Definitions.
(a) The following capitalized words and phrases as used in this
Agreement have the meanings indicated below:
"Advanced Data Services" has the meaning set forth in Schedule 1.
"Brand" of any Person means a trademark, tradename, service xxxx and/or
logo of such Person.
"Bulk Purchaser" means a purchaser of cable television service that
provides such service to multiple dwelling units (whether in one or more
buildings or whether in one or more complexes or locations) of which it
is the owner or for which it acts as manager or agent or with which it
otherwise has a relationship, by contract or otherwise.
"Cable Subsidiary" means (i) any Controlled Affiliate of TCI Parent that
owns a cable television system and (ii) any Person that TCI Parent or
its Controlled Affiliates has a unilateral right to cause to comply with
Section 2 hereof with respect to cable television systems owned by such
Person.
"Controlled Affiliate" means (i) when used with respect to TCI Parent,
each Subsidiary of TCI Parent, (ii) when used with respect to Sprint
Parent, each Subsidiary of Sprint Parent, and (iii) when used with
respect to any Person in Section 2 hereof, including TCI Parent and
Sprint Parent, any Affiliate of such Person that such Person can
directly or indirectly unilaterally cause to take or refrain from taking
any of the actions required, prohibited or otherwise restricted by such
Section, whether through ownership of voting securities, contractually
or otherwise.
"Entertainment Services" has the meaning set forth in Schedule 1.
"Excluded Businesses" has the meaning set forth in Schedule 1.
"Households Passed" means, as of any relevant date, the aggregate number
of residential dwelling units to which the facilities of TCI Parent's
Cable Subsidiaries either (i) are capable, as of such date, of providing
Local Telephony Service by means of an existing customer drop or other
similar connection or (ii) could legally provide Local Telephony Service
using a customer drop or other similar connection no more than two
hundred (200) feet in length (exclusive of any wiring within the
applicable structure and assuming that the applicable owner or occupant
consented to receipt of Local Telephony Service). For purposes of this
definition, each residential dwelling unit in a multiple dwelling unit
that is otherwise within the foregoing definition will be counted as one
Household Passed.
"IXC" means each of the following Persons, each successor to the long
distance telephony business of any such Person and each of the
respective Affiliates of each such Person or successor: AT&T Corp., MCI
Communications Corporation, British Tele-Communications plc, Worldcom,
Inc., Cable & Wireless plc, LCI International Inc. and Frontier
Corporation.
"Local JV" has the meaning set forth in Section 3.
"Local Telephony Services" has the meaning set forth in Schedule 1.
"Long Distance Telephony Services" has the meaning set forth in Schedule
1.
"Non-Exclusive Services" has the meaning set forth in Schedule 1.
"RBOC" means each of the following Persons, each successor to the local
exchange carrier business of any such Person and each of the respective
Affiliates of each such Person or successor: each BOC, GTE Corporation
and Frontier Corporation.
"Rights of Use" means rights to use the distribution facilities of a
Cable Subsidiary's cable system to provide Local Telephony Services or
Advanced Data Services, as applicable, to end users connected to such
distribution facilities.
"Satellite Carrier" means each of the following Persons, each successor
to the direct broadcast satellite business of any such Person and each
of the respective Affiliates of each such Person or successor: DIRECTV,
Inc., U.S. Satellite Broadcasting, Inc. and EchoStar Communications
Corporation.
"Sprint LECs" means, as of any relevant date, those local exchange
carriers that are Subsidiaries of Sprint Parent.
"Teleport Contribution Agreement" means that certain Contribution
Agreement among the Cable Partners, MajorCo and NewTelco, L.P., dated as
of March 28, 1995.
"Term" means the period commencing on the date hereof and ending on the
date this Agreement terminates in accordance with Section 13.
"Territory" shall mean the United States, including all territories and
possessions thereof, except for Puerto Rico, but excluding as of any
date those geographic areas in which a Sprint LEC is providing Local
Telephony Services primarily through its owned facilities at such date.
(b) The following capitalized words and phrases as used in this
Agreement have the meanings ascribed thereto in the Partnership
Agreement: "Affiliate", "BOC", "Business Day", "Cable Partner", "MFJ",
"Parent", "Person", "Sprint Brand", "Subsidiary", "Substantial Portion",
"Teleport".
(c) The definitions in this Section 1 and elsewhere in this Agreement
shall apply equally to both the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms. The words
"include", "includes" and "including" shall be deemed to be followed by
the phrase "without limitation". The words "herein", "hereof" and
"hereunder" and words of similar import refer to this Agreement
(including the Schedules) in its entirety and not to any part hereof
unless the context shall otherwise require. All references herein to
Sections and Schedules shall be deemed references to Sections of, and
Schedules to, this Agreement unless the context shall otherwise require.
Unless the context shall otherwise require, any references to any
agreement or other instrument or statute or regulation are to it as
amended and supplemented from time to time (and, in the case of a
statute or regulation, to any corresponding provisions of successor
statutes or regulations). Any reference in this Agreement to a "day" or
number of "days" (without the explicit qualification of "Business")
shall be interpreted as a reference to a calendar day or number of
calendar days. If any action or notice is to be taken or given on or by
a particular calendar day, and such calendar day is not a Business Day,
then such action or notice shall be deferred until, or may be taken or
given on, the next Business Day.
SECTION 2. Undertakings.
(a) Exclusive Packaging/Marketing.
(i) TCI Parent agrees that, during the Term, it will not directly or
through any Subsidiary formed for such purpose, and it will cause
its Cable Subsidiaries (and each other Controlled Affiliate of TCI
Parent that is authorized to offer or promote, or package, any of
the products or services of its Cable Subsidiaries) not to, (A)
offer or promote, or package any of the products or services of such
Cable Subsidiary with, or act as sales agent for, any Long Distance
Telephony Services or Local Telephony Services in the Territory
under the Brand of an RBOC or an IXC, other than the Sprint Brand,
or (B) package any of the Non-Exclusive Services referred to in
clause (2), (3), (4), (5), (6), (7) or (8) of the definition of such
term in Section V of Schedule 1 under the Brand of an RBOC or an
IXC, other than the Sprint Brand, with Local Telephony Services
being offered by TCI Parent or its Controlled Affiliates in the
Territory under the Brand of TCI Parent, an Affiliate of TCI Parent
or Teleport, in each case except as permitted by Section 2(a)(ii)
and Section 4 and except as may otherwise be required by applicable
law, and provided that TCI Parent shall not be deemed to be in
violation of this covenant solely because advertising relating to
RBOC- or IXC-Branded Local Telephony Services, Long Distance
Telephony Services or Non-Exclusive Services being offered or
promoted, or packaged, by TCI Parent or any of such Cable
Subsidiaries or other such Controlled Affiliates solely in one or
more geographic areas outside of the scope of this Section 2(a)(i)
appears in or is broadcast to one or more geographic areas within
the scope of this Section 2(a)(i) so long as such advertising is
designed to reach primarily potential customers in such geographic
areas outside the scope of this Section 2(a)(i). The inclusion,
whether alone or in a package, of offers or promotions of Long
Distance Telephony Services or Local Telephony Services under the
brand of an RBOC or an IXC (including advertising on advertising
availabilities sold by a Cable Subsidiary) in programming or other
content contained in products or services of a Cable Subsidiary
shall not be deemed to be a violation of this Section 2(a)(i) unless
such offers or promotions (other than offers or promotions included
in the content of a shopping channel or similar service) would
otherwise involve a violation of this Section. The foregoing shall
not be construed to in any way limit the right of TCI Parent and any
of its Controlled Affiliates that are providing Local Telephony
Service in a market to provide any of its customers in that market
with any Long Distance Telephony Service, including an IXC-branded
Long Distance Telephony Service, that such customer may request and
to receive payment therefor from the provider of such Long Distance
Telephony Service in the form of an access fee or such other form,
including commission, as may be customary in the particular market
in the absence of a pre-existing sales agency agreement with a
provider. TCI Parent and Sprint Parent further agree to negotiate
in good faith for TCI Parent and its Cable Subsidiaries to act, and
Sprint Parent agrees that TCI Parent and its Cable Subsidiaries will
be authorized to act, as non-exclusive sales agents for the Long
Distance Telephony Services of Sprint Parent and its Controlled
Affiliates during the Term on a most favored nation commission basis
and on such other terms as the parties may agree. The immediately
preceding sentence sets forth the intention of the parties with
respect to such sales agency but is not intended to create any
legally binding obligation or give rise to any legal or equitable
right or remedy.
(ii) Except as otherwise required by law, Sprint Parent agrees that,
during the Term, Sprint Parent will not, and will cause its
Controlled Affiliates not to, offer or promote, or package any of
the products or services of Sprint Parent or its Controlled
Affiliates with, any Entertainment Services under the Brand of an
RBOC or a Satellite Carrier in any geographic area in the Territory
in which a Cable Subsidiary of TCI Parent is providing cable
television service as of the date hereof or as of any relevant date
hereafter; provided that Sprint Parent shall not be deemed to be in
violation of this covenant solely because advertising relating to
RBOC- or Satellite Carrier-Branded Entertainment Services being
offered or promoted, or packaged, by Sprint Parent or its
Controlled Affiliates solely in one or more geographic areas
outside of the scope of this Section 2(a)(ii) appears in or is
broadcast to one or more geographic areas within the scope of this
Section 2(a)(ii) so long as such advertising is designed to reach
primarily potential customers in such geographic areas outside the
scope of this Section 2(a)(ii); and provided, further, that Sprint
Parent shall not be deemed in violation of this covenant as a
result of its offering, promoting or packaging any of its products
or services with Entertainment Services under an RBOC- or Satellite
Carrier-Brand in a particular geographic area if each of the
following conditions is met: (x) at the time Sprint Parent or its
Controlled Affiliates entered into the agreement with such RBOC or
Satellite Carrier, no Cable Subsidiary was providing cable
television services in the geographic area covered by such
agreement and (y) subject to the following sentence, such agreement
is terminated by Sprint Parent or its applicable Controlled
Affiliate as soon as practicable after notice (specifically
referring to this Section of this Agreement) is given to it by TCI
Parent of the applicability of this covenant to such geographic
area, but in any event not later than (A) one year following the
giving of such notice or (B) such later date as the agreement may
be terminated by Sprint Parent or the applicable Controlled
Affiliate without penalty, but this clause (B) shall only apply if
Sprint Parent was unable to negotiate on commercially reasonable
terms an earlier right of termination that would have complied with
clause (A), notwithstanding its good faith efforts.
Notwithstanding the preceding sentence, Sprint Parent or its
Controlled Affiliate, as applicable, may elect, by notice
(specifically referring to this Section of this Agreement) given to
TCI Parent within 60 days after its receipt of notice from TCI
Parent pursuant to clause (y) above, not to terminate its agreement
with an RBOC or Satellite Carrier in the applicable market unless
TCI Parent provides or causes to be provided to Sprint Parent or
its applicable Controlled Affiliate on competitive economic terms
the same or substantially similar kinds of Entertainment Services
under a TCI Parent Brand to offer and promote, and package with
other products and services to offer and promote, to its customers
in such market. If Sprint Parent makes the foregoing election and
TCI Parent does not make such Entertainment Services so available
within 30 days of its receipt of such notice from Sprint Parent,
then (x) Sprint Parent and its applicable Controlled Affiliate
shall not be deemed to be in breach of this Section 2(a)(ii) solely
as a result of its failure to terminate its agreement with the RBOC
or Satellite Carrier with respect to the applicable market and (y)
TCI Parent and its Controlled Affiliates shall be released from
their obligations under Section 2(a)(i) with respect to such
market, and Sprint Parent and its Controlled Affiliates shall be
released from their obligations under Section 2(a)(ii) with respect
to such market.
(b) Right of Use.
(i) TCI Parent agrees that, during the Term: (x) if a Cable Subsidiary
of TCI Parent makes Rights of Use for Local Telephony Services
available on its distribution facilities in a particular market to
any Person other than (A) an Affiliate of such Cable Subsidiary, (B)
Teleport, (C) MajorCo or (D) a Local JV, TCI Parent will cause that
Cable Subsidiary to make Rights of Use available to Sprint Parent
and its Controlled Affiliates (or, if TCI Parent or a Controlled
Affiliate of TCI Parent and Sprint Parent or a Controlled Affiliate
of Sprint Parent have entered a Local JV with regard to such market,
the Local JV in such market) on the same facilities in such market
for the same or similar kinds (including, subject to the following
paragraph, specifications and standards, capacity and quality
metrics) of Local Telephony Services and, if applicable, the same or
similar kinds of Non-Exclusive Services, on no less favorable terms;
and (y) if a Cable Subsidiary of TCI Parent makes Rights of Use
available on its distribution facilities in a particular market to
any IXC or RBOC for the provision of Advanced Data Services, TCI
Parent will cause that Cable Subsidiary to make Rights of Use
available to Sprint Parent and its Controlled Affiliates (or, if TCI
Parent or a Controlled Affiliate of TCI Parent and Sprint Parent or
a Controlled Affiliate of Sprint Parent have entered a Local JV with
regard to such market, the Local JV in such market) on the same
facilities in such market for the same or similar kinds (including,
subject to the following paragraph, specifications and standards,
capacity and quality metrics) of Advanced Data Services on no less
favorable terms. TCI Parent will notify Sprint Parent immediately
of any agreement that may be reached for Rights of Use that would be
subject to the preceding sentence.
The parties understand and agree that if, by virtue of physical
limitations of the applicable facilities, the Cable Subsidiary
cannot ensure identical specifications and standards or quality
metrics for Rights of Use to multiple parties, then the Cable
Subsidiary may make economic distinctions with respect to the Rights
of Use it offers that would be taken into account in determining
whether the covenant of TCI Parent in this Section 2(b)(i) to offer
the applicable services on no less favorable terms has been
satisfied. By way of example, if an IXC were willing to pay a
premium for Rights of Use that included a guarantee of no blocking,
Sprint Parent would be required to pay that premium in order for it
to exercise its rights under this Section 2(b)(i) to obtain that
guarantee on no less favorable terms, notwithstanding that it would
then be paying more for its Rights of Use than the other IXCs that
did not have such guarantee or than any other IXC if such guarantee
could not be made available to more than one Person.
(ii) Sprint Parent agrees that if, during the Term, it or any of its
Controlled Affiliates proposes to provide Local Telephony Services
on a resale basis in any market in the Territory in which a Cable
Subsidiary has facilities, it will promptly so notify TCI Parent
and (x) if the facilities that are in place meet Sprint Parent's
specifications and standards (including time to market) for the
provision of such Local Telephony Services, then Sprint Parent
will, and will cause its Controlled Affiliates to, cooperate with
TCI Parent in good faith to negotiate (and TCI Parent will
cooperate with Sprint Parent in good faith to negotiate) mutually
satisfactory terms for the provision of Local Telephony Services
under the Sprint Brand using the facilities of such Cable
Subsidiary and (y) if the facilities that are in place do not meet
Sprint Parent's specifications and standards (including time to
market) for the provision of Local Telephony Services or if the
parties have not reached agreement upon the terms of the provision
of such services as contemplated by clause (x) above, then Sprint
Parent will or will cause its applicable Controlled Affiliate to
provide TCI Parent with a non-exclusive sales agency agreement for
such Local Telephony Services on terms and conditions no less
favorable to TCI Parent and its Controlled Affiliates than are
offered to any other non-exclusive sales agent for such Local
Telephony Services in such market, provided such obligation shall
terminate if TCI Parent or any of its Controlled Affiliates
commence the offering of facilities-based Local Telephony Services
in the applicable geographic area. The parties acknowledge that
there will be a presumption of good faith in the negotiations
pursuant to clause (x) above and that a party will not be deemed to
have failed to act in good faith solely as a result of taking
non-negotiable positions or different or inconsistent positions
with respect to different markets or a position that is different
from any position that has been accepted by another Cable Parent.
The obligations of Sprint Parent and TCI Parent to engage in such
negotiations under this Section 2(b)(ii) with respect to a
particular market will continue for a period of 90 days following
the receipt by TCI Parent of the notice referred to in the first
sentence of this Section 2(b)(ii) and will terminate at the end of
such 90-day period. Nothing contained in this Section 2(b)(ii)
shall be construed to restrict Sprint Parent or its Controlled
Affiliates from rolling out Local Telephony Services in any market
or delay such rollout, subject to compliance with the applicable
requirements of Section 2(a) above, provided that neither Sprint
Parent nor its Controlled Affiliates will enter into any agreements
that are not terminable by it on not less than 30 days' notice if
the parties reach agreement within the 90-day period.
SECTION 3. Local Joint Agreement; Teleport
(a) During the Term, TCI Parent will notify Sprint Parent whenever a
Cable Subsidiary of TCI Parent intends to upgrade its distribution
facilities for Local Telephony Services (or through some other means
offer Local Telephony Services) in a particular market (other than in
the context contemplated by Section 4(a)) but in no event earlier than
one year prior to the date it intends to commence offering Local
Telephony Services in such market. There will be a presumption that if
TCI Parent notifies Sprint Parent that a Cable Subsidiary of TCI Parent
intends to upgrade its distribution facilities in a particular market
(or through some other means offer Local Telephony Services) that it
intends to commence offering Local Telephony Services in such market
within one year. TCI Parent and Sprint Parent will cooperate with each
other in good faith to negotiate mutually satisfactory terms for the
provision of Local Telephony Services under the Sprint Brand in such
market using the local distribution facilities of the applicable Cable
Subsidiary (or such other means). The parties acknowledge that there
will be a presumption of good faith in such negotiations and that a
party will not be deemed to have failed to act in good faith solely as a
result of taking non-negotiable positions or different or inconsistent
positions with respect to different markets or a position that is
different from any position that has been accepted by another Cable
Parent. For a period of 90 days following Sprint Parent's receipt of
the notice required pursuant to the first sentence of this Section 3
with respect to a particular market, TCI Parent, Sprint Parent and their
respective Controlled Affiliates shall not negotiate with any other
Person regarding the provision of Local Telephony Services in such
market; provided, however, that TCI Parent and Sprint Parent will
commence immediately such negotiation with respect to those markets
listed on Schedule 2 attached hereto (the "Specified Markets") and the
period of exclusive negotiation with respect to the Specified Markets
shall expire on March 31, 1996. The obligations of TCI Parent and
Sprint Parent under this Section 3 with respect to a particular market
shall terminate upon expiration of the exclusive negotiation period
provided in this Section 3 with respect to such market. The contractual
arrangements between TCI Parent and Sprint Parent or their respective
Controlled Affiliates regarding the provision of such services in a
particular market may take the form of a local joint venture agreement
or another form as the applicable parties may negotiate and upon such
terms (including economic terms, scope, etc.) as they may agree (such
joint venture or other entity formed by, or other agreement or
arrangement between, Sprint Parent and TCI Parent or their respective
Controlled Affiliates for the purposes contemplated by this Section 3, a
"Local JV"). If Sprint Parent or any of its Controlled Affiliates are
providing Local Telephony Services on a resale basis in a market at the
time the terms of a Local JV are agreed upon with respect to such market
then Sprint Parent shall or shall cause its applicable Controlled
Affiliates to offer to transfer to the Local JV its business of
providing Local Telephony Services in such market and, at TCI Parent's
option, the assets used in such business, at a price determined on the
same basis as would then be applicable to a transfer of a business under
Section 6.3(p) of the Partnership Agreement. If Sprint Parent and TCI
Parent have not reached agreement upon the terms of a Local JV for a
particular market (an "Unresolved Market") by the expiration of the
90-day period of exclusive negotiation and, at that date or at any time
thereafter prior to Sprint Parent and TCI Parent or their respective
Controlled Affiliates having entered a Local JV with respect to the
Unresolved Market, Sprint Parent or one of its Controlled Affiliates has
entered a Local JV with any Cable Parent or a Controlled Affiliate
thereof with respect to a market the characteristics of which that are
relevant to the business of Local Telephony Services are similar to
those of the Unresolved Market, then Sprint Parent shall offer to enter
into or cause one of its Controlled Affiliates to enter into a Local JV
with a Controlled Affiliate of TCI Parent for the Unresolved Market on
terms and conditions no less favorable to TCI Parent and its Controlled
Affiliates than those Sprint Parent (or its Controlled Affiliate) has
agreed to with respect to such other similar market. Sprint Parent
agrees to disclose to TCI Parent promptly the terms of any agreements it
may reach with Cox Parent or Comcast Parent or their respective
Controlled Affiliates regarding the provision of Local Telephony
Services in any market, and TCI Parent hereby consents to the disclosure
by Sprint Parent to Cox Parent and Comcast Parent of any agreement that
TCI Parent and Sprint Parent may reach as contemplated by this Section
3. Nothing contained in this Section 3 or in Section 2(b)(ii) shall be
construed to restrict any Controlled Affiliate of TCI Parent from
rolling out Local Telephony Services in any market or delay such
rollout, subject to compliance with Section 2 above.
(b) It is the present goal and intention of the parties to continue to
attempt to integrate the businesses and activities of Teleport with the
business and activities of MajorCo as promptly as practicable, provided
that the parties can achieve mutually satisfactory agreements for such
integration and for the provision of Local Telephony Service in the
Specified Markets. The foregoing is intended to set forth the parties'
present intentions concerning their future efforts with respect to the
achievement of their mutual goal of integrating MajorCo and Teleport,
but is not intended to and does not create a legally binding obligation,
it being understood that the Cable Parents and their respective
Controlled Affiliates remain free to pursue activities that they, in
their sole discretion, consider to be in the best interests of Teleport
and its owners, and each party remains free to determine, in its sole
discretion, to proceed, or agree that MajorCo would proceed, with any
proposed transaction involving Teleport.
Without limiting any party's ability to exercise its sole discretion
with respect to matters covered in this Section 3(b), Sprint Parent has
advised the Cable Parents that the failure of a proposed agreement
regarding Teleport to include the following may result in Sprint
Parent's refusal to enter into an agreement with respect to Teleport,
were any such agreement to be proposed: (i) the contribution to MajorCo
of at least a 62.5% ownership interest in Teleport under the same
economic terms as would have applied if the Teleport Contribution
Agreement had not been terminated (which, in Sprint Parent's opinion,
would require adjustments for the loss of tax benefits arising from the
reorganization of Teleport into corporate form, if such were to occur);
(ii) governance of the Teleport interests held by MajorCo in accordance
with the current MajorCo governance provisions; (iii) modification of
the Teleport governance provisions to provide that all matters will be
resolved by simple majority vote, both at the governing board and
stockholder/partner level, and to eliminate all special rights of
partners to elect governing board members or to approve or disapprove
transactions involving stockholders/partners and their respective
affiliates (provided that such transactions are on arms' length terms);
(iv) modification of the scope and exclusivities of Teleport in a manner
that rationalizes the operations of Teleport, MajorCo and the individual
wireline efforts of the Partners, which would include the exclusion of
Teleport from the wireless business, the limitation of Teleport's
residential switched activities to the New York market, and a
reconciliation of the respective activities of Teleport and the Local
JVs relating to the small business market; (v) the marketing of all of
Teleport's retail products under the Sprint Brand; and (vi) receipt of
satisfactory consents and waivers from Continental Cablevision,
Inc. ("Continental") and its Subsidiaries or removal of Continental or
the applicable Subsidiary as a Teleport stockholder/partner.
SECTION 4. Certain Exceptions to Undertakings.
(a) The covenants of TCI Parent in Sections 2 and 3 shall not apply with
respect to a Bulk Purchaser in circumstances where, in the reasonable
judgment of TCI Parent, a Cable Subsidiary or other Controlled Affiliate
of TCI Parent needs to offer to a Bulk Purchaser of cable television
services a package of services which include one or more Local Telephony
Services and/or Long Distance Telephony Services in order to compete
with an actual or anticipated offer to such Bulk Purchaser by a provider
unaffiliated with TCI Parent (whether facilities-based, as a reseller or
agent or otherwise) of television/telephony services and the needed
service is not then available to TCI Parent for inclusion in such a
package from Sprint Parent or its Affiliates on competitive economic
terms. The covenants of TCI Parent in Sections 2(b)(i) and 3, and the
rights of Sprint Parent under such Sections, shall not become applicable
solely as a result of the provision of such services to the Bulk
Purchaser.
(b) If Sprint Parent and TCI Parent have not reached an agreement on
mutually satisfactory terms for the provision of Local Telephony
Services in a particular market through a Local JV within the exclusive
negotiation period with respect to such markets contemplated by Section
3, then the provisions of Section 2(a)(i) will cease to apply with
respect to Long Distance Telephony Services in such market, unless
Sprint Parent makes available or causes to be made available to TCI
Parent or its applicable Controlled Affiliate on competitive economic
terms Sprint-Branded Long Distance Telephony Services to offer and
promote, and package with other products and services to offer and
promote, to its customers, and for which it would be authorized to act
as non-exclusive sales agent, in that market.
(c) If Sprint Parent and TCI Parent have not reached an agreement on
mutually satisfactory terms for the provision of Local Telephony
Services in a particular market through a Local JV within the exclusive
negotiation period with respect to such market contemplated by Section 3
and Sprint Parent or any of its Controlled Affiliates is providing
(through resale or otherwise) Local Telephony Services in such market,
then the provisions of Section 2(a)(i) will cease to apply in such
market, unless Sprint Parent makes available or causes to be made
available to TCI Parent or its applicable Controlled Affiliate on
competitive economic terms Sprint-Branded Long Distance Telephony
Services to offer and promote, and package with other products and
services to offer and promote, to its customers, and for which it would
be authorized to act as non-exclusive sales agent, in that market.
(d) TCI Parent's obligations under this Agreement with respect to any
Person that becomes a Cable Subsidiary or Controlled Affiliate of TCI
Parent after the date hereof and any cable television system or
facilities acquired by TCI Parent or a Cable Subsidiary after the date
hereof shall be subject to any contrary provisions of any agreements
with Persons (other than TCI Parent or a Controlled Affiliate of TCI
Parent) to which such Cable Subsidiary, Controlled Affiliate or cable
television system or facilities are subject prior to the time such
Person became a Cable Subsidiary or Controlled Affiliate or such system
or facilities were acquired.
(e) Sprint Parent's obligations under this Agreement with respect to any
Person that becomes a Controlled Affiliate of Sprint Parent after the
date hereof shall be subject to any contrary provisions of any
agreements with Persons (other than Sprint Parent or a Controlled
Affiliate of Sprint Parent) to which such Controlled Affiliate is
subject prior to the time such Person became a Controlled Affiliate.
SECTION 5. Consent to Jurisdiction.
(a) Each of Sprint Parent and TCI Parent hereby irrevocably and
unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any New York State court sitting in the
County of New York or any Federal court of the United States of America
sitting in the State of New York, and any appellate court from any such
court, in any suit, action or proceeding arising out of or relating to
this Agreement, or for recognition or enforcement of any judgment, and
hereby irrevocably and unconditionally agrees that all claims in respect
of any such suit, action or proceeding may be heard and determined in
such New York State court or, to the extent permitted by law, in such
Federal court.
(b) Each of Sprint Parent and TCI Parent hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and
effectively do so, any objections which it may now or hereafter have to
the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement in any New York State court sitting in the
County of New York or any Federal court sitting in New York. Each of
Sprint Parent and TCI Parent hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the
maintenance of such suit, action or proceeding in any such court and
further waives the right to object, with respect to such suit, action or
proceeding, that such court does not have personal jurisdiction over it.
(c) Each of Sprint Parent and TCI Parent irrevocably consents to service
of process in the manner provided for the giving of notices pursuant to
this Agreement, provided that such service shall be deemed to have been
given only when actually received by it. Nothing in this Agreement
shall affect the right of a party to serve process in any other manner
permitted by law.
SECTION 6. Waiver; Remedies.
The observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively) by the party entitled to enforce such term, but any such
waiver shall be effective only if in a writing signed by the party
against which such waiver is to be asserted. Except as otherwise
provided herein, no failure or delay of any party in exercising any
power or right under this Agreement shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such right or
power, preclude any other or further exercise thereof or the exercise of
any other right or power.
SECTION 7. Assignment.
Except with respect to an assignment in connection with a transfer (in a
single transaction or series of related transactions) of all or a
Substantial Portion of the cable television system assets (in the case
of TCI Parent) or long distance telecommunications business assets (in
the case of Sprint Parent) owned by TCI Parent or Sprint Parent,
respectively, directly or through Controlled Affiliates immediately
prior to the transfer (or the first transfer of the series) (a
"Permitted Transaction") to (i) the transferee of such assets or (ii)
the Parent of such transferee, this Agreement shall not be assignable
without the prior written consent of the other party. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns, and shall be binding
upon the transferee of such party in a Permitted Transaction (which
transferee the applicable transferor shall cause to agree in writing to
be so bound in connection with such Permitted Transaction). Nothing in
this Agreement, whether express or implied, shall be construed to give
any Person other than the parties hereto and their respective successors
and permitted assigns any legal or equitable right, remedy or claim
under or in respect of this Agreement.
SECTION 8. Severability.
Every provision of this Agreement is intended to be severable. If any
term or provision hereof is illegal, invalid or unenforceable for any
reason whatsoever, that term or provision will be enforced to the
maximum extent permissible and such illegality, invalidity or
unenforceability shall not affect the validity or legality of the
remainder of this Agreement.
SECTION 9. Governing Law.
The internal laws of the State of Delaware (without regard to principles
of conflict of law) shall govern the validity of this Agreement, the
construction of its terms, and the interpretation of the rights and
duties of the parties.
SECTION 10. Waiver of Jury Trial.
Sprint Parent and TCI Parent each irrevocably waives to the extent
permitted by law all rights to trial by jury in any action, proceeding
or counterclaim arising out of or relating to this Agreement.
SECTION 11. Notices.
Any notice, payment, demand or communication required or permitted to be
given by any party by any provision of this Agreement shall be in
writing and mailed (certified or registered mail, postage prepaid,
return receipt requested) or sent by hand or overnight courier, or by
facsimile (with acknowledgment received), charges prepaid and addressed
as follows, or to such other address or number as such party may from
time to time specify by notice to the other party:
(a) If to TCI Parent, to:
Tele-Communications, Inc.
0000 XXX Xxxxxxx
Xxxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attn: Executive Vice President
and Chief Operating Officer
with copies to:
TCI Network Services
0000 XXX Xxxxxxx
Xxxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attn: President
Xxxxx & Xxxxx, L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxxxxxx Xxxxxxxxx, Esq.
(b) If to Sprint Parent, to:
Sprint Corporation
0000 Xxxxxxx Xxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attn: Chief Financial Officer
with copies to:
Sprint Spectrum, L.P.
0000 Xxxxxxx Xxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
Attn: Corporate Secretary
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxx X. Xxxxxxxxx, Esq.
Any party may from time to time specify a different address by notice to
the other parties. All notices and other communications given to a
Person in accordance with the provisions of this Agreement shall be
deemed to have been given and received (i) four (4) Business Days after
the same are sent by certified or registered mail, postage prepaid,
return receipt requested, (ii) when delivered by hand or transmitted by
facsimile (with acknowledgment received and, in the case of a facsimile
only, a copy of such notice is sent no later than the next Business Day
by a reliable overnight courier service, with acknowledgment of
receipt), or (iii) one (1) Business Day after the same are sent by a
reliable overnight courier service, with acknowledgment of receipt.
SECTION 12. Entire Agreement.
The provisions of this Agreement set forth the entire agreement and
understanding between the parties as to the subject matter hereof and
supersede all prior agreements, oral or written, and other
communications between the parties relating to the subject matter
hereof.
SECTION 13. Term.
This Agreement and the rights and obligations of the parties hereunder
will terminate on January 31, 2001, provided that this Agreement and the
rights and obligations of the parties shall earlier terminate on the
first to occur of (i) January 31, 1999 if at that date Local Telephony
Services are being offered under the Sprint Brand by TCI Parent and its
Controlled Affiliates (or Local JVs) through facilities of its Cable
Subsidiaries passing fewer than 25% of the aggregate number of
Households Passed by facilities of TCI Parent and its Cable Subsidiaries
that have been upgraded for, and through which TCI Parent and its
Controlled Affiliates (or Local JVs) are providing, Local Telephony
Services, (ii) such date as of which neither TCI Parent nor any of its
Controlled Affiliates is a partner in MajorCo and (iii) such date as of
which neither Sprint Parent nor any of its Controlled Affiliates is a
partner in MajorCo.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.
TELE-COMMUNICATIONS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Executive Vice President
SPRINT CORPORATION
By: /s/ J. Xxxxxxx Xxxxxx
Name: J. Xxxxxxx Xxxxxx
Title: Executive Vice President
SCHEDULE 1
Certain Defined Terms
II. Local Telephony Services
"Local Telephony Services" shall mean wireline "local exchange, access,
and transport services" offered or provided to residences in the
Territory that are functionally equivalent (from the customer's
perspective) to circuit-based offerings (e.g., a POTS access line that
provides to the user a circuit of equal and fixed bi-directional
transmission capacity). Local Telephony Services may utilize an
underlying network technology that is not circuit-based as long as the
offering to the residence is (from the customer's perspective)
functionally equivalent to one of the "local exchange, access and
transport" services listed below. Local Telephony Services shall not
include Advanced Data Services, the Non-Exclusive Services and the
Excluded Businesses.
Local Telephony Services shall include the provision and transport of
intra-LATA wireline calls, except for 75 Mile Plus Calls.
Local Telephony Services are not restricted by form (e.g., analog or
digital), method of origination (e.g., voice, data, telemetry, etc.), or
the content transmitted by the customer.
The "local exchange, access, and transport" services are:
1. Local dial tone service for residential customers (i.e., basic
service, additional lines, EAS, ISDN, etc.);
2. Ancillary basic service features such as tone dialing, custom
calling, CLASS, Centrex, and functionality for number portability;
3. Access for switched and dedicated intra-LATA and inter-LATA service;
4. Private line services not interconnected with an inter-LATA private
line network (including back haul for wireless services); and
5. "Video telephony", which shall mean circuit switched two-way
communications services that are not Excluded Businesses providing:
a. point-to-point two-way audio/video connectivity;
b. point-to-point one-way video connectivity and two way audio
connectivity;
c. multi-point to multi-point audio/video connectivity; or
d. access for intra-LATA and inter-LATA video telephony.
III. Long Distance Telephony Services
"Long Distance Telephony Services" shall mean (other than as provided in
Sections I and V of this Schedule 1) (a) wireline inter-LATA service to
residences in the Territory, except for that subject to local exchange
carrier inter-LATA waivers or (b) 75 Mile Plus Calls to residences in
the Territory, but in each case excluding any of such services that are
also Advanced Data Services or services described in clauses (2) or (3)
of the definition of Excluded Business in Section VI below.
IV. Advanced Data Services
"Advanced Data Services" shall mean wireline services offered or
provided to residences in the Territory that are functionally equivalent
to asynchronous offerings (e.g., an internet access service with
instantaneously varying data rates and equal or unequal bi-directional
transmission capacity). Advanced Data Services shall not include the
Local Telephony Services, the Non-Exclusive Services, and those
Excluded Businesses referred to in clauses (1), (2) and (3) of the
definition of Excluded Businesses in Section VI of this Schedule 1.
V. Entertainment Services
"Entertainment Services" means the delivery via a distribution system
(whether wired or wireless, and whether terrestrial or satellite-based)
of entertainment and, except to the extent contemplated under
Non-Exclusive Services, other content-based services, which services in
either such case are competitive with services typically provided by
cable television companies to their customers at the date of this
Agreement. The provision of Internet access services, incidental
audio/video content related to the provision of Internet access services
(e.g. browsers, navigators, logos, customer service, sales) and on-line
hosting services shall not be deemed to be Entertainment Services.
VI. Non-Exclusive Services
"Non-Exclusive Services" means each of the following:
1. Incidental services to other Local Telephony Services, including
billing services and the installation, maintenance, repair, sale or
lease of customer premises equipment or customer controlled
equipment.
2. 500 Services.
3. Meeting services, such as video or other teleconferencing in which
the provider does not create nor resell the content of such service.
4. Server-based content services customarily provided by local exchange
telephone companies, consisting of directory assistance, operator
service, time, temperature and similar information services that are
voice only and TDD relay.
5. Incidental data services to support signaling, billing and system
diagnostics and management for audio/video connectivity.
6. Incidental audio/video content (e.g., logos, customer service,
sales), that are directly related to the provision of video
telephony.
7. Enhanced services such as voice mail, e-mail, facsimile store and
forward.
8. Video telephony enhanced services, such as video mail, store and
forward, and customer service, but excluding any such enhanced
service that is an Excluded Business.
VII. Excluded Business
"Excluded Business" means each of the following:
1. Long Distance Telephony Services.
2. The provision of entertainment and, except to the limited extent
contemplated under Non-Exclusive Services, other content-based
services.
3. The provision or transport of wireline services using unidirectional
transmission capacity.
4. The provision or transport of wireline services using unequal
bi-directional transmission capacity.
VIII. Definitions.
As used in this Schedule:
1. The term "LATA" means a Local Access and Transport Area established
pursuant to the criteria set forth in Section 4(g) of the MFJ, as
approved in United States v. Western Electric Company, Inc., et. al.,
569 F. Supp. 990 (D.D.C. 1983), and as amended by subsequent orders,
regardless of whether the LATA boundaries continue to be applied in
future governmental regulation of the wireline telecommunications
industry. In the event of the cessation of use of LATA boundaries by
a telecommunications governmental regulation or court order, then the
LATA boundaries in effect at the time of cessation of such use shall
be deemed to be the LATA boundaries for purposes of this Agreement.
2. The term "Rate Center" means a point within a geographic area
designated by agreement of TCI Parent and Sprint Parent as the Rate
Center and shall be used for measuring distances to and from such
geographic area. Each geographic area shall have one Rate Center.
The Rate Center shall be near the geographic center of the geographic
area.
3. The term "75 Mile Plus Calls" means wireline calls between end users
whose Rate Centers are greater than 75 miles apart.
4. The term "residences" will have its customary meaning unless and
until the scope of Teleport's business is confined by agreement of
its owners so as to exclude (or make non-exclusive) serving "small
business customers", in which event the term "residences" will also
include "small business customers". The term "small business
customer" for this purpose means a non-residential customer having
five or fewer Access Lines. The term "Access Line" means a
voice-grade message telephone line (DS-0 equivalent) that can
originate or terminate telecommunications services, which need not
have a separate telephone number, and is interconnected with the
public switched telephone network; provided, that an ISDN BRI shall
count as one Access Line.
