Master Services Agreement

MASTER SERVICES AGREEMENT


BY AND BETWEEN


ALLTEL INFORMATION SERVICES, INC.


AND


dba COMMUNICATIONS, LLC


DATED AS OF: DECEMBER 9, 1999


TABLE OF CONTENTS


1. DEFINITIONS............................................................................................ 1


1.1 Definitions................................................................................... 1


1.2 Definition Cross-Reference Index.............................................................. 3


2. SERVICES............................................................................................... 4


2.1 Services...................................................................................... 4


2.2 Exhibits...................................................................................... 5


3. FEES AND PAYMENT ARRANGEMENTS.......................................................................... 5


3.1 Service Fees.................................................................................. 5


3.2 Payments by Client............................................................................ 5


(a) Invoicing and Payment Requirements................................................... 5


(b) Past Due Amounts..................................................................... 6


4. TERM................................................................................................... 7


5. PREMISES AND SECURITY.................................................................................. 7


5.1 Premises for Data Processing.................................................................. 7


5.2 Local Offices................................................................................. 7


5.3 Security Standards............................................................................ 7


6. CLIENT RESOURCES....................................................................................... 8


6.1 Client Resources.............................................................................. 8


6.2 Required Consents............................................................................. 8


(a) Cooperation.......................................................................... 8


(b) Costs................................................................................ 8


7. HARDWARE, TECHNICAL SYSTEMS, SUPPLIES, AND POSTAGE..................................................... 8


7.1 Hardware and Technical Systems................................................................ 8


7.2 Hardware Maintenance and Technical Systems Maintenance........................................ 8


i


7.3 Terminals/Workstations/Network Equipment...................................................... 9


7.4 Supplies, Forms and Postage................................................................... 9


8. SOFTWARE............................................................................................... 9


8.1 User Manuals.................................................................................. 9


8.2 Third Party Software and Maintenance.......................................................... 9


(a) Third Party Software................................................................. 9


(b) Third Party Software Maintenance..................................................... 10


8.3 ALLTEL Software............................................................................... 10


8.4 Installation of New Releases, Updates and Enhancements........................................ 10


9. PERSONNEL AND COMMITTEES............................................................................... 12


9.1 ALLTEL Account Manager and ALLTEL Account Team................................................ 12


9.2 Client Project Manager........................................................................ 12


9.3 ALLTEL Variable Staff......................................................................... 12


9.4 Variable Staff Personnel Changes.............................................................. 13


9.6 Effective Planning and Communications......................................................... 14


(a) Open Communication................................................................... 14


(b) Steering Committee................................................................... 14


10. FILES AND PROGRAMS, STORAGE, AND DISASTER RECOVERY..................................................... 14


10.1 Backup........................................................................................ 14


10.2 Data Retention................................................................................ 14


10.3 Disaster Recovery............................................................................. 14


11. MANAGEMENT PROCESS..................................................................................... 14


11.1 Change Management Process..................................................................... 15


11.2 Transition of Certain Access Lines to the Mescalero Indians................................... 15


12. INTELLECTUAL PROPERTY RIGHTS........................................................................... 15


12.1 Modifications to Client-Provided Third Party Software......................................... 15


ii


12.2 Ownership of ALLTEL Software.................................................................. 16


12.3 Modifications to ALLTEL Software.............................................................. 16


13. AUDITS................................................................................................. 17


13.1 Client's Audits............................................................................... 17


13.2 Excluded Materials............................................................................ 17


14. DISPUTE RESOLUTION..................................................................................... 17


14.1 Dispute Resolution Procedures................................................................. 18


14.2 Claims Procedures............................................................................. 18


14.3 Escalation Procedures......................................................................... 18


14.4 Arbitration Procedures........................................................................ 20


14.5 Claim Expiration.............................................................................. 21


14.6 Continuation of Services...................................................................... 21


15. LIMITATION OF LIABILITY................................................................................ 22


16. INDEMNIFICATION........................................................................................ 22


16.1 Personal Injury and Property Damage........................................................... 22


16.2 Infringement of ALLTEL Software or ALLTEL-Provided Third Party Software....................... 22


16.3 Infringements of Client-Provided Third Party Software or Client Resources..................... 23


16.4 Dispute Resolution............................................................................ 24


17. FORCE MAJEURE, TIME OF PERFORMANCE AND INCREASED COSTS, AND ERROR CORRECTION........................... 24


17.1 Force Majeure................................................................................. 24


17.2 Time of Performance and Increased Costs....................................................... 25


17.3 Error Correction.............................................................................. 25


18. NOTICES................................................................................................ 26


18.1 Notices....................................................................................... 26


18.2 Change of Address............................................................................. 26


iii


19. TERMINATION............................................................................................ 26


19.1 Termination................................................................................... 26


19.2 Termination Upon ALLTEL's Material Breach..................................................... 27


19.3 Termination Upon Client's Material Breach..................................................... 29


19.4 Termination of Certain Services............................................................... 31


19.5 Termination for Convenience by Client......................................................... 31


19.6 Operations During the Termination Period...................................................... 32


19.7 Transitional Cooperation...................................................................... 33


(a) Offer of Employment.................................................................. 33


(b) Transition........................................................................... 33


(c) Return of Material................................................................... 33


(d) Equipment............................................................................ 34


19.8 Survival Upon Expiration or Termination....................................................... 34


20. CONFIDENTIALITY........................................................................................ 35


20.1 Confidentiality Obligation............................................................................. 35


20.2 GTE Confidentiality Agreement................................................................. 36


20.3 Independent Development....................................................................... 36


20.4 Confidentiality of this Agreement; Protective Arrangements.................................... 36


21. OTHER REPRESENTATIONS, WARRANTIES AND COVENANTS........................................................ 37


21.1 Licenses and Permits and Compliance with Laws................................................. 37


(a) Licenses and Permits................................................................. 37


(b) Compliance with Laws................................................................. 37


21.2 No Interference with Contractual Relationship................................................. 37


21.3 Covenant of Good Faith........................................................................ 37


21.4 Authorization and Effect...................................................................... 37


21.5 Business Practices............................................................................ 38


iv


21.6 ALLTEL Software and ALLTEL-Provided Third Party Software...................................... 38


21.7 Professional and Workmanlike.................................................................. 39


21.8 Year 2000 Compliant........................................................................... 39


21.9 No Additional Representations or Warranties................................................... 40


22. MISCELLANEOUS.......................................................................................... 40


22.1 Independent Contractor........................................................................ 40


(a) Client Supervisor Powers............................................................. 40


(b) ALLTEL's Employees................................................................... 40


(c) Relationship......................................................................... 40


22.2 Assignment.................................................................................... 40


22.3 Severability.................................................................................. 41


22.4 Third Party Beneficiaries..................................................................... 41


22.5 Governing Law; Forum Selection; Consent of Jurisdiction....................................... 41


22.6 Executed in Counterparts...................................................................... 42


22.7 Construction.................................................................................. 42


22.8 Entire Agreement.............................................................................. 42


22.9 Amendments and Waivers........................................................................ 42


22.10 Remedies Cumulative........................................................................... 42


22.11 Press Releases................................................................................ 43


22.12 Taxes......................................................................................... 43


22.13 Mergers and Acquisitions...................................................................... 43


v


EXHIBITS


Exhibit A Managed Operations Services Exhibit B Managed Network Services Exhibit C Output Processing Services Exhibit D Call Center Services Exhibit E Service Fees Exhibit F Service Level Measurements Exhibit G Client-Provided Third Party Software Exhibit H ALLTEL Software Exhibit I ALLTEL-Provided Third Party Software Exhibit J Variable Staff Exhibit K Disaster Recovery Provisions Exhibit L Conversion Services Exhibit M Training Services Exhibit N Confidentiality Agreement Exhibit O GTE Confidentiality Agreement Exhibit P Termination of Certain Services


a


MASTER SERVICES AGREEMENT


Confidential Treatment. The portions of this exhibit that have been replaced with "[*****]" have been filed separately with the Securities and Exchange Commission and are the subject of an application for confidential treatment.


This is a Master Services Agreement (the "Agreement"), dated as of the 9th day of December, 1999 ("Effective Date"), by and between ALLTEL INFORMATION SERVICES, INC. an Arkansas corporation whose principal place of business is located at 4001 Rodney Parham Road, Little Rock, Arkansas 72212 ("ALLTEL") and dba COMMUNICATIONS, LLC, a Delaware limited liability company, whose principal place of business is located at 1200 19th Street, NW, Suite 500, Washington, D.C. 20036 (the "Client").


NOW, THEREFORE, the parties agree as follows:


1. DEFINITIONS.


1.1 DEFINITIONS. As used in this Agreement:


(a) "Access Lines" shall mean the access lines in New
Mexico, Texas and Oklahoma to be acquired by Client
from GTE Southwest Incorporated.


(b) "Affiliate" shall mean with respect to any entity,
any other entity Controlling, Controlled by or under
common Control with such entity. "Control" and its
derivatives shall mean the legal, beneficial, or
equitable ownership, directly or indirectly, of at
least fifty-percent (50%) of the aggregate of all
voting equity interests in an entity or equity
interests having at least fifty-percent (50%) of the
assets of an entity and, in the case of a
partnership, also includes the holding by an entity
(or one of its Affiliates) of the position of sole
general partner.


(c) "ALLTEL-Provided Third Party Software" shall mean any
program, or part of a program which is licensed or
sublicensed to ALLTEL by a third party that has the
right to provide that license or sublicense,
including, without limitation, those programs
described in Exhibit I.


(d) "ALLTEL Software" shall mean any program as described
in Exhibit H, or part of such program as described in
Exhibit H, which is owned by ALLTEL or any ALLTEL
Affiliate, and its related user documentation, and
any related modifications, upgrades or enhancements
to any such program or the related user documentation
prepared by ALLTEL or any ALLTEL Affiliate.


(e) "Client-Provided Third Party Software" shall mean any
program, or part of a program which is licensed or
sublicensed to Client by a Third Party that has the
right to provide that license or sublicense,
including, without limitation, those programs
described in Exhibit G.


(f) "Client Resources" shall mean those assets, services,
personnel, decisions and rights, if any, provided,
leased, contracted for, licensed, or owned by Client,
including Client-Provided Third Party Software, if
any, to be made available at no charge to ALLTEL by
Client to enable ALLTEL to provide the Services and
described as a Client Resource in this Agreement.


(g) "Days" shall mean calendar days, unless otherwise
specified.


(h) "Expiration Date" shall mean the earliest of (i) the
later to occur of sixty (60) months following the
Managed Operations Commencement Date or the date to
which this Agreement is extended in accordance with
Section 4, or (ii) the date this Agreement is
terminated in accordance with Section 19.


(i) "GTE Agreements" shall mean collectively the Asset
Purchase Agreements by and between dba NEW MEXICO
OPERATING CO., LLC and GTE SOUTHWEST INCORPORATED
dated September 3, 1999; by and between dba TEXAS
OPERATING CO., LP and GTE SOUTHWEST INCORPORATED
dated September 3, 1999; and by and between dba
OKLAHOMA OPERATING CO., LLC and GTE SOUTHWEST
INCORPORATED dated October 22, 1999._


(h) "Managed Operations Commencement Date" shall mean the
date on which ALLTEL first processes in a production
environment any of Client's Access Lines.


(i) "Operation Year 1" shall mean the twelve (12) month
period beginning on the Managed Operations
Commencement Date.


(j) "Operation Year 2" shall mean the twelve (12) month
period beginning on the Day following the end of
Operation Year 1.


(k) "Operation Year 3" shall mean the twelve (12) month
period beginning on the Day following the end of
Operation Year 2.


(l) "Operation Year 4" shall mean the twelve (12) month
period beginning on the Day following the end of
Operation Year 3.


(m) "Operation Year 5" shall mean the period beginning on
the Day following the end of Operation Year 4 and
ending on the Expiration Date, unless otherwise
agreed to by the parties.


(n) "Pass-Through Expenses" shall mean those designated
costs or expenses under this Agreement incurred by
ALLTEL that shall be passed through to Client by
ALLTEL without mark up.


2


(o) "Required Consents" shall mean the consents required
(if any) to enable ALLTEL to use any Client
Resources.


(p) "WAN" shall mean the wide area network, hardware,
software and other resources used to provide the
Managed Network Services described in Exhibit B.


1.2 DEFINITION CROSS-REFERENCE INDEX. As used in this Agreement,
the following terms are defined in the following sections of
the Agreement:


TERM SECTION
---- -------
Access Line Charge 2.1 of Exhibit E
Affected Performance 17.1
Agreement Preamble
ALLTEL Preamble
ALLTEL Damages 19.3
ALLTEL Termination Election Date 19.3
ALLTEL Work 12.3
Application Support and Development Exhibit J
Assignment 22.2
Call Center Services 2.1
Call Center Staff Exhibit D
Capitalized Conversion Fees Exhibit E
Change Management Process 11
Change Order 11
Client Preamble
Client Damages 19.2
Client Project Manager 9.2
Client Termination Election Date 19.2/19.4
Client Work 12.1
Confidentiality Agreement 20.1
Conversion Completion Date Exhibit L
Conversion Services 2.1
Continuation Services Exhibit L
Courts 22.5
Disaster Recovery Services 2.1
Early Termination Notice 19.5
Enhancements Exhibit J
Effective Date Preamble
Escalation Procedures 14.3
GTE Confidentiality Agreement 20.2
Interest Rate 3.2(b)
Local Offices 5.2
Managed Network Services 2.1


3


Managed Operations Services 2.1
Output Processing Services 2.1
Press Release 22.11
Proprietary Information 20.1
Service Level Measurements Exhibit F
Services 2.1
Service Fees 3.1
Software Development and Methodology Process Exhibit J
Table Administration Exhibit J ...