Master Design Build - Horizon

CONFIDENTIAL TREATMENT REQUESTED


Confidential Portions of This Agreement Which Have been Redacted are Marked with Brackets ("[***]"). The Omitted Material has been Filed Separately with The Securities and Exchange Commission.


MASTER DESIGN BUILD AGREEMENT


THIS MASTER DESIGN BUILD AGREEMENT ("Agreement"), dated as of the ____ day of ____________, 1999 ("Effective Date"), is made by and between Horizon Personal Communications, Inc. ("Horizon") and SBA Towers, Inc., a Florida corporation ("BTS Company").


WHEREAS, Horizon Telecom, Inc., Horizon and SBA have entered into an Asset Purchase Agreement ("APA") whereby SBA will purchase certain telecommunications tower sites from Horizon, and Horizon and SBA have entered into or have agreed to enter into a Master Site Agreement ("MSX"), and a Site Development Agreement ("Site Development Agreement"); and


WHEREAS, Horizon is in the business of providing wireless telecommunications services; and


WHEREAS, BTS Company is in the business of erecting, owning and leasing tower facilities for equipment used in providing such services; and


WHEREAS, Horizon desires to use BTS Company's services to identify, evaluate, and acquire sites for such tower facilities; and


WHEREAS, BTS Company desires to construct a network of such tower facilities within Horizon's service areas in a manner that will coordinate with Horizon's needs for tower facilities; and


WHEREAS, the parties desire that in most cases a site identified by the procedures set forth herein will result in a tower facility constructed by BTS Company and leased to Horizon for the installation and operation of its equipment; and


WHEREAS, this Agreement sets forth the manner in which Horizon will identify the general location of potential sites, BTS Company will evaluate and make recommendations as to specific sites and Horizon will lease space on any such site for the installation and operation of its equipment pursuant to this Agreement.


NOW, THEREFORE, for and in consideration of the mutual promises set forth herein, the parties hereto agree as follows:


1. RELATIONSHIP OF PARTIES


1.1 INDEPENDENT CONTRACTOR RELATIONSHIP. The parties intend by this Agreement to establish an independent contractor relationship. Neither party nor their employees shall be agents or legal representatives of the other party for any purpose. Neither party shall have the authority to act for, bind, or commit


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the other party. BTS Company and Horizon agree that this Agreement does not establish or create a relationship of employer-employee, principal-agent, or a franchise, joint venture, or partnership for any purpose whatsoever.


1.2 CONTRACTS WITH AFFILIATES. BTS Company may contract with any Affiliate (as hereinafter defined) of BTS Company to provide goods or services beyond those which its employees would perform, if it deems the same to be necessary or advisable for development and/or construction of the Sites.


1.3 LANDLORD AND TENANT RELATIONSHIP. BTS Company and Horizon shall execute contemporaneously with the execution of this Agreement, the MSA which governs the relationship of BTS Company, as landlord, and Horizon, as tenant, on those BTS Sites which are accepted by Horizon pursuant to Section 2.7(b) of this Agreement. A copy of the MSA is attached hereto as Exhibit "A."


1.4 EXCLUSIVITY. During the term of this Agreement, BTS Company shall be the exclusive build-to-suit, site acquisition, line and antenna installation, and construction company for wireless telecommunications tower sites for Horizon and its Affiliates in Region 1 and Region 2 (as those terms are defined in the MSA and the Site Development Agreement which is executed simultaneously herewith). For purposes of this Agreement, "Affiliates" with respect to either party, shall mean companies which control, are controlled by, or under common control with that party. For purposes of this Agreement, the word "control" shall mean the ownership, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, or the power to veto major policy decisions of any such entity, whether through the ownership of voting securities, by contract or otherwise. During the term of this Agreement Horizon shall not engage any third party or Affiliate directly or indirectly to perform build-to-suit site acquisition, construction, or equipment installation services described in this Agreement and will not enter into any discussions with any third party or Affiliate concerning, or furnish any information relating to such services to any third party or Affiliate, for the purpose of considering, soliciting or inducing any offer by such third party. Notwithstanding the foregoing, in the event that Horizon and BTS Company do not agree upon the payment amount for a CMS Site, Horizon shall be entitled to utilize a different contractor or subcontractor or its own personnel for construction services. In the event that Horizon elects to utilize a different contractor or subcontractor as provided herein, Horizon shall first offer BTS Company the right to perform such services on the same terms and conditions as offered by the contractor or subcontractor.


II. SITE ACQUISITION SERVICES.


2.1 SITE ACQUISITION SERVICES.


(a) Horizon shall establish small geographic areas within which a cell site or transmission tower shall be located, based on the network grid's RF design (a "Search Ring"). For each Search Ring, Horizon shall provide (i) minimum tower specifications, (ii) desired mounting height, (iii) a description of the equipment that Horizon intends to put on the tower, and


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(iv) any other technical data necessary to permit SBA to effectively identify the candidate sites that meet Horizon's needs. Horizon will provide to BTS Company its System network grid, with the established Search Rings overlaid thereon. Horizon will, from time to time, assign Search Rings to BTS Company. BTS Company shall provide the personnel and facilities which are necessary to locate and lease or license existing towers, buildings or other structures by Horizon to be used for the construction and installation of Horizon's equipment ("Collocation Sites") or unimproved real property suitable for the construction and installation of a communications tower ("Tower") and related facilities by BTS Company ("BTS Site"). As used herein, "Sites" shall refer to both Collocation Sites and BTS Sites, where appropriate. The Site Acquisition Services are more particularly described in and shall be performed by BTS Company in accordance with the scope of work attached hereto as Schedule "A" which is incorporated by referenced herein ("Site Acquisition Services"). BTS Company shall be entitled to compensation from Horizon for the Site Acquisition Services as set forth on Schedule "C".


(b) Upon its receipt of a Search Ring designated hereunder by Horizon, BTS Company shall promptly, diligently and professionally perform the Site Acquisition Services with respect to such Search Ring. BTS Company shall perform the Site Acquisition Services in accordance with this Agreement, including, without limitation, the objectives and procedures set forth in Schedule "A" ("Objectives and Procedures"). Provided that Horizon does not materially increase BTS Company's duties or impair BTS Company's rights hereunder, Horizon shall have the right from time to time upon written notice to BTS Company to adjust, modify or supplement the Objectives and Procedures and the form of documents to be generated or provided by BTS Company pursuant thereto.


(c) Except as expressly authorized in this Agreement or otherwise expressly authorized by Horizon in writing, BTS Company shall provide all labor, equipment, material and supplies necessary or appropriate to perform Site Acquisition Services. In the event that BTS Company elects to subcontract any Site Acquisition Services, BTS Company shall obtain Horizon's prior written consent to utilize such subcontractors, which consent shall not be unreasonably conditioned, delayed or withheld.


(d) During the performance of Site Acquisition Services with respect to any designated Search Ring, BTS Company shall at all times apprise Horizon of any expressed opposition, protest, litigation or other efforts, whether by an individual, group, neighborhood association or other organization, to restrict, alter or prohibit the construction, installation or operation of any structure, structures or other facilities that Horizon or BTS Company proposes to construct or operate on any Site within such Search Ring.


2.2 WITHDRAWAL OF SITE. In the event Horizon elects to withdraw a Collocation Site at any time or a BTS Site pursuant to the terms of this Agreement Horizon shall give BTS Company notice of such withdrawal and shall pay BTS Company [***] of the milestone installment that would be due if the work currently in progress was completed, [***] of the reimbursable costs which were incurred prior to the date on which BTS Company receives notice of the withdrawn Site, and [***] of all other amounts due hereunder for work completed on the Site as of the date BTS Company receives Horizon's withdrawal notice and substitute the withdrawn Site with an alternative site within sixty (60) days


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[***] - CONFIDENTIAL TREATMENT REQUESTED


("Alternative Site"), if available. In the event that a withdrawn Site is a BTS Site, Horizon shall pay BTS Company for Site Acquisition Services in connection with such Site as set forth in Schedule "C" attached hereto.


2.3 SEARCH RINGS DESIGN. Horizon shall have the right at any time in its sole and absolute discretion to expand or reconfigure a previously designated Search Ring. In the event that Horizon redesigns a search ring beyond 0.5 miles of an urban or suburban Site or 1.5 miles of a rural Site for which BTS Company has begun but not yet completed all Site Acquisition Services, then Horizon shall pay BTS Company [***] for all Site Acquisition Services completed at the time that the notice of redesign is received by BTS Company, [***] of the reimbursable costs which were incurred prior to the date on which BTS Company receives notice of such reconfigured Search Ring, and [***] of the milestone installment that would be due if the work currently in progress was completed. In the event that such Site was a BTS Site, Horizon shall pay BTS Company for such Site Acquisition Services as set forth on Schedule "C". For all Site Acquisition Services rendered for the redesigned search ring, in the event that the Site in the redesigned Search Ring is not a BTS Site, Horizon shall pay BTS Company an additional [***] of the milestone installments due for all milestone installments to be performed and [***] of all milestone installments to be performed for the first time and [***] of the reimbursable costs which are incurred. Horizon agrees not to develop any site within any redesigned or withdrawn Search Rings as a tower site and further agrees not to transfer the associated Work Product to any third party, including Affiliates.


2.4 TERM OF SITE ACQUISITION SERVICES AGREEMENT. The term of this Agreement (the "Site Acquisition Term") shall commence on the date of this Agreement and shall expire on December 31, 2001.


(a) This Agreement may be terminated as to any particular Search Ring upon written notice by either party following the other party's breach of an obligation or covenant on such party's part to be performed with respect to that Search Ring, which breach is not cured within thirty (30) days after the breaching party's receipt of written notice; provided, however, that so long as the defaulting party commenced appropriate curative action within such thirty (30) day period, and thereafter diligently prosecutes such cure to completion as promptly as possible, the cure period will be extended until the cure is completed. If a party fails to cure a breach within this thirty (30) day period, as it may be extended, the party will be in default under this Agreement as it applies to the applicable Search Ring; and


(b) Neither a termination nor the expiration of this Agreement shall affect:


(i) the term of the MSA or any SLA, as that term is defined herein, which has been entered into by the parties prior to the date of termination of this Agreement, which shall continue in accordance with its terms and conditions;


(ii) the terms of this Agreement that apply to any SLA which has been entered into by the parties prior to the date of termination of this Agreement;


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[***] - CONFIDENTIAL TREATMENT REQUESTED


(iii) any duties or obligations for payment or performance that are or become owing hereunder prior to the effective date of such termination;


(iv) the terms of this Agreement that apply to any Search Ring which was issued prior to the date of termination of this Agreement; or


(v) any other duties or obligations that expressly survive the termination or expiration hereof.


(c) A default regarding one Search Ring shall not constitute a default under this Agreement; however, a default under the greater of: (1) [***] Search Rings; or (2) [***] or more of the Search Rings which have been issued pursuant to this Agreement, shall constitute a default under every Search Ring and a default under this Agreement. In the event of such a default, Horizon shall be entitled to terminate the services of BTS Company and complete or engage a third party to complete BTS Company's responsibilities under this Agreement pursuant to the Plans and Specifications (as hereinafter defined) provided by BTS Company. In such event, Horizon shall convey the Tower Facilities (as hereinafter defined) and any site development materials including ground leases and title, environmental and geotechnical reports to BTS Company upon completion, lien free, and BTS Company shall reimburse Horizon for the reasonable costs of completing its responsibilities and pay Horizon the applicable site development fee set forth in the Site Development Agreement (as hereinafter defined).


2.5 GROUND LEASES. The acquisition of BTS Sites by BTS Company pursuant to this Agreement shall be accomplished using a lease agreement in substantially the same form as the Option and Lease Agreement which is attached hereto as Exhibit "B" (hereafter the "Ground Lease"). In no event shall BTS Company agree to material modifications to the provisions set forth in paragraph 35 of the Ground Lease without Horizon's prior written approval. The acquisition of Collocation Sites by BTS Company pursuant to this Agreement shall be accomplished using a lease agreement which Horizon shall provide to BTS Company or on such other form which Horizon may, in its sole discretion, approve.


2.6. ACCEPTANCE AND REJECTION OF COLLOCATION SITES. Horizon may at any time in its sole and absolute discretion accept or reject any proposed Collocation Site. Without limiting the foregoing, Horizon may withdraw its prior acceptance of a Collocation Site and thereby reject such Collocation Site. A withdrawal or a rejection by Horizon of a Collocation Site shall not affect its obligation for fees earned through the date of termination for Site Acquisition Services as more particularly described in Section 2.2.


2.7 ACCEPTANCE AND REJECTION OF BTS SITES; EXECUTION AND DELIVERY OF SLAS.


(a) A BTS Site shall be deemed to be an accepted BTS Site from and after the date that the Candidate Site which corresponds to the BTS Site has been approved by Horizon pursuant to Section 2(a) of Schedule A and shall continue to be deemed an accepted BTS Site unless and until Horizon rejects the BTS Site pursuant to section 2.7(b) hereof.


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(b) Horizon may at any time prior to the parties' execution and delivery of an SLA corresponding thereto, and in Horizon's sole and absolute discretion, reject any BTS Site. In the case of a BIS Site that is accepted by Horizon, the following shall apply:


(i) BTS Company shall continue the diligent, thorough and professional prosecution of Site Acquisition Services (including the completion of Ground Lease negotiations and required zoning, land use and permitting matters) necessary for the construction of a communications tower and related facilities consistent with the criteria theretofore identified by Horizon;


(ii) Subject to Section 2.7(b)(iii) below, BTS Company and Horizon shall prepare and finalize the SLA (and exhibits thereto) applicable to such BTS Site;


(iii) Within thirty (30) days following BTS Company's receipt of all necessary zoning or other land use permits or approvals applicable to the improvements to be constructed by BTS Company on the BTS Site and the completion of Site Acquisition Services in accordance with the Objectives and Procedures, but subject to Section 2.7(b)(iv) below, Horizon and BTS Company shall execute and deliver the SLA applicable thereto. Unless Horizon rejects the applicable BTS Site within thirty (30) days following notice by BTS Company of BTS Company's receipt of all necessary zoning or other land use permits or approvals applicable to the landlord improvements to be constructed by BTS Company on the BTS Site and BTS Company's completion of Site Acquisition Services in accordance with the Objectives and Procedures, BTS Company shall be unconditionally obligated to enter into the SLA with respect thereto upon receipt of the foregoing permits and approvals, and shall thereafter perform its obligations thereunder in accordance with the SLA and this Agreement. Notwithstanding any provision of this Agreement to the contrary, in the event that Horizon neither accepts nor rejects the BTS Site within thirty days as provided herein, BTS Company may, at BTS Company's sole option either (1) deem the BTS Site approved (in which event BTS Company shall be entitled to compel Horizon to execute a SLA with respect to the BTS Site) or (2) deem the BTS Site to be denied and make demand on Horizon for payment of the fees earned for Site Acquisition Services.


(iv) Horizon may in its sole and absolute discretion withdraw its prior acceptance of a BTS Site, and thereby reject said BTS Site, at any time prior to the BTS Company parties' execution and delivery of the SLA for such BTS Site.


(c) In the event of a rejection by Horizon of a BTS Site, including a rejection after a prior acceptance thereof as described above in Section 2.7(b) hereof, Horizon's only obligation for such BTS Site shall be for the payment of Site Acquisition Services incurred prior to such rejection with respect to the Search Ring containing such BTS Site in accordance with Section 2.2. In such event, Horizon agrees not to develop the rejected BTS Site as a tower site and further agrees not to transfer the associated Work Product to any third party, including Affiliates.


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(d) In the event of a rejection by Horizon of a BTS Site, BTS Company may elect to forego the compensation set forth in Section 2.2 and retain the Work Product. In such event, Horizon shall have the right, but not the obligation, for a period of one (1) year following the construction of a tower on such Site to enter into an SLA for such Site pursuant to the MSA as if such Site were constructed as an accepted BTS Site; provided, however, that Horizon shall not be entitled to compensation for such Site under the Site Development Agreement.


(e) This Section 2.7 shall not be deemed to limit or restrict any rights of termination of a SLA as expressly set forth therein. Horizon's rights of rejection with respect to a BTS Site contained in this Section 2.7 shall be in addition to, and not in lieu of, any SLA termination rights.


(f) In the event that BTS Company's due diligence investigation of a BTS Site reveals any defect in such Site which BTS Company reasonably believes would materially adversely affect BTS Company's multi-tenant use or ownership of such Site, BTS Company shall be entitled to reject such Site upon notice to Horizon. In such event, Horizon shall have the right to designate another candidate site as the preferred candidate. BTS Company shall bear all costs associated with Site Acquisition Activities and all costs associated with the due diligence investigation, zoning, and permitting of such Site.


2.8 CONTINUED PERFORMANCE OF SITE ACQUISITION SERVICES FOLLOWING SITE ACCEPTANCE OR REJECTION. Unless otherwise notified by Horizon, BTS Company shall:


(a) Following Horizon's acceptance of any Site, continue to perform Site Acquisition Services with respect to such accepted Site in accordance with this Agreement including, without limitation, the Objectives and Procedures; and


(b) Following Horizon's rejection of any Site (including a rejection after Horizon's prior acceptance thereof), continue to perform Site Acquisition Services with respect to the Search Ring pertaining thereto (including a modified Search Ring as described above in Section 2.3 hereof) in accordance with the terms and conditions of this Agreement, including, without limitation, the Objectives and Procedures.


2.9 NO CONFLICTING OBLIGATIONS.


(a) Neither BT'S Company nor any Affiliate of BTS Company shall hereafter during the Site Acquisition Term enter into any agreement, contract or other arrangement with any Competitor (For purposes of this Agreement "Competitor" shall mean an entity whose business includes the provision of wireless telecommunications services to the public) pursuant to which BTS Company or any Affiliate of BTS Company agrees to provide to or on behalf of such Competitor site acquisition services that: (i) may result in the leasing (or other acquisition) of real property and the construction thereon by BTS Company or such Affiliate of a wireless communications facility designed to meet such Competitor's specifications and (ii) affect or may affect any real property located within a Search Ring. BTS Company shall provide to Horizon during the Site Acquisition Term BTS Company's primary duty of loyalty and professionalism in the


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performance within the geographic area of Site Acquisition Services hereunder. BTS Company shall not perform, or undertake to perform, any services that would conflict with BTS Company's loyal, professional and diligent performance of its duties hereunder. The foregoing provisions of this Section 2.9(a) shall not apply if BTS Company notifies Horizon of a pre-existing conflict upon BTS Company's receipt of a Search Ring, nor will it apply to a Search Ring after BTS Company has completed construction of a BTS Site within such Search Ring.


(b) In the course of performing Site Acquisition Services or otherwise in conducting its activities under or with respect to this Agreement or any SLA, BTS Company shall not publish or distribute any materials or documentation using Horizon's name without Horizon's express prior written permission specifically relating to such use; provided, however, that BTS Company shall be entitled to utilize Horizon's name where reasonably necessary to facilitate zoning and other governmental approvals.


2.10 COMPLIANCE WITH LAWS. BTS Company represents and warrants that it shall: (a) comply with all federal, state and local laws, regulations and ordinances with respect to its performance of the Site Acquisition Services; (b) file all reports relating to the Site Acquisition Services and required under applicable law (including, without limitation, tax returns); (c) pay all filing fees and federal state and local taxes applicable to BTS Company's business as the same shall become due; and (d) pay all amounts required under local, state and federal workers' compensation, disability benefit, unemployment insurance, and other employee benefit laws and regulations when due. BTS Company shall provide Horizon with such documents and other supporting materials as Horizon may reasonably request to evidence BTS Company's continuing compliance with this Section 2. 10.


2.11 INSURANCE. BTS Company and Horizon shall each maintain in effect, without interruption, on an annual basis, during the term of this Agreement the following insurance policies:


(a) Commercial General Liability (Bodily Injury and Property Damage). Insurance coverage with endorsement evidencing coverage for contractual liability. The limits of this insurance shall not be less than:


(i) Each Occurrence Limit $1,000,000


(ii) General Aggregate Limit $2,000,000


(b) Comprehensive Automobile Liability insurance covering the ownership, operation and maintenance of allowed, non-owed, and hired motor vehicles, in limits not less than $1,000,000 for bodily injury and property damage per occurrence.


(c) Worker's Compensation Insurance with statutory limits and Employer's Liability Insurance with limits of not less than $ 1,000,00 for each accident.


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(d) Professional Liability (errors and omissions) insurance of not less than $1,000,000 for each occurrence, with endorsement evidencing coverage for contractual liability.


(e) All foregoing insurance shall provide for an effective date no later than the Effective Date of this Agreement. Horizon and BTS Company agrees to maintain such coverage in effect without interruption on an annual basis for so long as this Agreement is in effect. Horizon shall be included as an additional insured on BTS Company's Commercial General Liability insurance, and BTS Company shall be included as an additional insured on Horizon's Commercial General Liability insurance. Horizon and BTS Company agree to obtain such insurance from nationally recognized carriers at commercially reasonable rates. Horizon's and BTS Company's obligations under this Agreement, including its indemnification obligations under Section 2.12, will not be affected by obtaining or the failure to obtain any insurance coverage required under this Section 2.11.


(f) Horizon and BTS Company shall each provide the other with Certificates of Insurance from its insurance agent or broker or insurance company evidencing the above coverage and limits.


(g) All insurance policies required to be maintained hereunder shall be issued by companies that hold a current rating of not less than "A", according to Best Key Rating Guide, unless this requirement is expressly waived in writing by the other party.


2.12 INDEMNIFICATION. The following indemnities shall survive the expiration or termination of this Agreement:


(a) By Horizon. Horizon shall indemnify and hold harmless BTS Company, its Affiliates, directors, officers, shareholders, agents, and employees thereof from and against any fine, penalty, loss, cost, damage, injury, claim, expense (including reasonable attorney and other professional fees and costs and all reason ...