Exhibit 10.1

 

 

SETTLEMENT AGREEMENT AND
DISENTANGLEMENT TRANSITION PLAN

 

THIS SETTLEMENT AGREEMENT AND DISENTANGLEMENT TRANSITION PLAN (“Agreement”) is
made and entered into as of this 10th day of February, 2006, by and between
Nextel Operations, Inc., for itself and as authorized agent of and for Nextel of
California, Inc., Nextel Communications of the MidAtlantic, Inc., Nextel of New
York, Inc., Nextel South Corp., Nextel of Texas, Inc. and Nextel West Corp.
(collectively, “Nextel”) and Metro One Telecommunications, Inc. (“Metro One”).
The foregoing parties are sometimes referred to individually as a “Party” and
collectively as the “Parties.”

 

RECITALS

 

WHEREAS, Nextel and Metro One entered into that certain Master Services
Agreement for Directory Assistance Services dated January 1, 2005 (the “Master
Services Agreement”) pursuant to which Metro One provided certain directory
assistance services to Nextel; and

 

WHEREAS, on or about October 14, 2005 Nextel notified Metro One of its intent to
terminate the Master Services Agreement for convenience pursuant to
Section 11.2.2 thereof; and

 

WHEREAS, Nextel filed a complaint against Metro One in the United States
District Court for the Eastern District of Virginia (the “Court”), Civil Action
No. 1:05 CV-1452, captioned Nextel Operations, Inc. v. Metro One
Telecommunications, Inc., and Metro One has filed its answer and counterclaims
thereto (collectively, the “Litigation”); and

 

WHEREAS, on or about December 21, 2005, on the application of Nextel, the Court
entered a preliminary injunction requiring, among other things, Metro One to
continue meeting the prescribed service levels under the Master Services
Agreement and directing the Parties to continue in good faith to negotiate the
provisions of a disentanglement transition plan as contemplated by the Master
Services Agreement (the “Preliminary Injunction”); and

 

WHEREAS, the Parties now desire to resolve the claims raised in the Litigation
to avoid further expenditure of time and the expenses of contested litigation;
and

 

WHEREAS, the Parties also desire to enter into a mutually acceptable
“disentanglement transition plan” (the “Disentanglement Plan”) as contemplated
by Section 12 of the Master Services Agreement;

 

NOW, THEREFORE, in consideration of the covenants and mutual promises herein
contained, and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties hereby agree as follows.

 

AGREEMENT

 

1.             INCORPORATION OF RECITALS. THE ABOVE RECITALS ARE TRUE AND ARE
HEREBY INCORPORATED HEREIN.

 

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2.             RELEASES AND DISMISSAL OF LITIGATION. ON THE EFFECTIVE DATE (AS
DEFINED BELOW) NEXTEL AND METRO ONE SHALL (A) EXECUTE AND DELIVER A MUTUAL
RELEASE SUBSTANTIALLY IN THE FORM OF EXHIBIT ”A” HERETO THAT SHALL, AMONG OTHER
THINGS, PROVIDE FOR THE RELEASE OF ALL CLAIMS THAT HAVE, OR COULD HAVE, BEEN
RAISED IN THE LITIGATION; AND (B) FILE A STIPULATED DISMISSAL OF THE LITIGATION
SUBSTANTIALLY IN THE FORM OF EXHIBIT ”B” HERETO.

 

3.             EFFECTIVE DATE. THE “EFFECTIVE DATE” FOR PURPOSES OF THIS
AGREEMENT SHALL BE THE LATER OF (I) MARCH 31, 2006; OR (II) THE DATE THAT IS
FIVE (5) BUSINESS DAYS AFTER PAYMENT OF THE LAST INSTALLMENT OF THE NEXTEL
PAYMENT (AS DEFINED IN SECTION 6 BELOW).

 

4.             RELEASE OF PRELIMINARY INJUNCTION. UPON THE EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE PARTIES SHALL FILE AN ORDER IN THE FORM ATTACHED
HERETO AS EXHIBIT ”C” DISSOLVING THE PRELIMINARY INJUNCTION AND RELEASING THE
BOND POSTED IN CONNECTION THEREWITH.

 

5.             DISENTANGLEMENT PLAN. THE PARTIES HEREBY AGREE TO THE
DISENTANGLEMENT PLAN SET FORTH IN SECTIONS 5 AND 6 HEREOF, AND FURTHER AGREE
THAT IT CONSTITUTES THE DISENTANGLEMENT TRANSITION PLAN CONTEMPLATED BY
SECTION 12 OF THE MASTER SERVICES AGREEMENT:

 

A.             TRANSITION. NEXTEL SHALL TRANSFER DIRECTORY ASSISTANCE CALLS FOR
ITS CUSTOMERS FROM METRO ONE ON A CALL CENTER-BY-CALL CENTER BASIS. SCHEDULE 1
LISTS, BY LOCATION, THE METRO ONE CALL CENTERS CURRENTLY PROVIDING SERVICES TO
NEXTEL UNDER THE MASTER SERVICES AGREEMENT (EACH A “CALL CENTER”) AND, FOR EACH
CALL CENTER A “PLANNED TRANSITION DATE” AND A “TERMINATION DATE.”

 

B.             OBLIGATIONS OF NEXTEL. FOR EACH CALL CENTER FOR WHICH SCHEDULE 1
SPECIFIES A PLANNED TRANSITION DATE, NEXTEL SHALL USE ITS BEST EFFORTS TO
TRANSFER DIRECTORY ASSISTANCE CALLS OF ITS CUSTOMERS FROM THAT CALL CENTER ON OR
BEFORE THE SPECIFIED PLANNED TRANSITION DATE. IF NEXTEL IS UNABLE TO COMPLETE
THE TRANSITION BY THE PLANNED TRANSITION DATE, NEXTEL SHALL CONTINUE TO USE ITS
BEST EFFORTS TO COMPLETE THE TRANSITION AS SOON AS POSSIBLE THEREAFTER. ONCE ALL
NEXTEL CALLS HAVE BEEN TRANSITIONED FROM A CALL CENTER FOR A PERIOD OF
TWENTY-FOUR (24) HOURS (THE “ACTUAL TRANSITION DATE”), THE TRANSFER OF SUCH
CALLS SHALL BE DEEMED COMPLETE AND NEXTEL SHALL NOT ATTEMPT TO TRANSFER ANY SUCH
CALLS BACK TO SUCH CALL CENTER.

 

Other than as specified in Section 5.d, below, Nextel shall cease routing
directory assistance calls from its customers to each Call Center by no later
than the specified Termination Date for such Call Center.

 

C.             OBLIGATIONS OF METRO ONE. UNTIL THE EARLIER OF (I) THE ACTUAL
TRANSITION DATE, OR (II) THE TERMINATION DATE, METRO ONE SHALL CONTINUE TO
PROVIDE SERVICES TO NEXTEL FROM THAT CALL CENTER AS REQUIRED BY THE MASTER
SERVICES AGREEMENT, INCLUDING WITHOUT LIMITATION MAINTAINING THE SERVICE LEVEL
REQUIREMENTS SET FORTH IN SECTION 2.4 AND SCHEDULE 2.4 OF THE MASTER SERVICES
AGREEMENT (“SERVICE LEVELS”). ON THE EARLIER OF (I) THE ACTUAL TRANSITION DATE;
OR (II) THE TERMINATION DATE, METRO ONE SHALL HAVE NO FURTHER OBLIGATION (OTHER
THAN AS SPECIFIED IN SUBSECTION 5.D BELOW) TO PERFORM ITS OBLIGATIONS AND
PROVIDE NEXTEL WITH ANY OF THE SERVICES UNDER SECTION 2.3 AND THE RELATED
SCHEDULES AND ATTACHMENTS OF THE MASTER SERVICE AGREEMENT, INCLUDING WITHOUT
LIMITATION MAINTAINING SERVICE LEVELS WITH RESPECT TO ANY NEXTEL CALLS ROUTED TO
THE APPLICABLE CALL CENTER, PROVIDED, HOWEVER, THAT NOTHING IN THIS
SUBSECTION SHALL BE DEEMED

 

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TO PREVENT METRO ONE FROM CONTINUING TO OPERATE A PARTICULAR CALL CENTER AFTER
THE ACTUAL TRANSITION DATE OR TERMINATION DATE, AS APPLICABLE, TO SERVE
CUSTOMERS OF CARRIERS OTHER THAN NEXTEL.

 

In the event that any Termination Date must be extended as a result of any act
or omission within the sole control of Metro One, such that the Actual
Transition Date occurs later than the specified Termination Date, then Metro
One’s obligations to perform its obligations and provide Nextel with the
Services under Section 2.3 and the related Schedules and Attachments of the
Master Services Agreement, including without limitation maintaining Service
Levels with respect to any Nextel calls routed to the applicable Call Center,
shall continue until the Actual Transition Date.

 

D.             INABILITY TO TRANSFER CALLS BY TERMINATION DATE. IN THE EVENT
THAT NEXTEL FAILS TO MEET ITS OBLIGATION TO TRANSITION ALL DIRECTORY ASSISTANCE
CALLS FROM A PARTICULAR CALL CENTER BY THE SPECIFIED TERMINATION DATE, OR IF ANY
TRANSITION OF NEXTEL CUSTOMER CALLS FROM SUCH CALL CENTER IS UNSUCCESSFUL ON OR
AFTER SUCH TERMINATION DATE THEN, AT THE WRITTEN REQUEST OF NEXTEL, METRO ONE
WILL ATTEMPT TO SERVICE SUCH CALLS FROM ITS REMAINING CALL CENTERS, CONSISTENT
WITH THE CAPACITY OF SUCH REMAINING CALL CENTERS; PROVIDED, HOWEVER, THAT METRO
ONE SHALL HAVE NO OBLIGATION TO MAINTAIN SERVICE LEVELS AS TO SUCH CALLS OR TO
KEEP ANY PARTICULAR CALL CENTER(S) OPEN FOR THE PURPOSE OF SERVICING SUCH CALLS.

 

E.             NEXTEL CONSENT TO REROUTING OF CALLS. NOTWITHSTANDING
SUBSECTION 5.C, ABOVE, METRO ONE MAY REQUEST IN WRITING THAT NEXTEL CONSENT TO
THE REROUTING OF DIRECTORY ASSISTANCE CALLS AWAY FROM A PARTICULAR CALL CENTER
PRIOR TO THE SPECIFIED TERMINATION DATE. IF NEXTEL CONSENTS IN WRITING (THE
“NEXTEL CONSENT”), WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD, METRO ONE
MAY REROUTE ANY CALLS RECEIVED FROM NEXTEL AT SUCH CALL CENTER TO ANOTHER CALL
CENTER OF METRO ONE’S CHOICE; PROVIDED, HOWEVER, THAT METRO ONE SHALL MAINTAIN
THE SERVICE LEVELS FOR SUCH REROUTED CALLS UNTIL THE ACTUAL TRANSITION DATE OR
THE TERMINATION DATE, AS APPLICABLE. ONCE ALL NEXTEL CALLS ARE REROUTED FROM A
CALL CENTER IN ACCORDANCE WITH THIS SUBSECTION 5.E, METRO ONE MAY RELEASE OR
TERMINATE THE EMPLOYEES WORKING AT SUCH CALL CENTER IN ITS SOLE DISCRETION.

 

F.              METRO ONE SERVICE LEVEL REPORTS. WITHIN TWO (2) DAYS FOLLOWING
THE LAST DAY OF FEBRUARY, 2006 METRO ONE SHALL PROVIDE TO NEXTEL A REPORT ON THE
SERVICE LEVELS FOR THE MONTH OF FEBRUARY AND SHALL MAKE THE APPROPRIATE
PERSONNEL AVAILABLE FOR A FORMAL MEETING TO DISCUSS SUCH REPORTS. ON OR BEFORE
MARCH 10, 2006, METRO ONE SHALL PROVIDE NEXTEL A REPORT ON THE SERVICE LEVELS
FOR THE FIRST SEVEN (7) DAYS OF MARCH AND SHALL MAKE THE APPROPRIATE PERSONNEL
AVAILABLE FOR A FORMAL MEETING TO DISCUSS SUCH REPORT. EACH SUCH DATE IS
REFERRED TO HEREIN AS A “REPORT DATE,” AND EACH PERIOD FOR WHICH SUCH REPORTS
ARE PROVIDED IS REFERRED TO HEREIN AS A “REPORTING PERIOD.”

 

G.             NEXTEL PAYMENT FOR SERVICES. NEXTEL SHALL CONTINUE TO MAKE
PAYMENTS TO METRO ONE FOR ALL SERVICES PROVIDED BY METRO ONE TO NEXTEL IN
ACCORDANCE WITH THE TERMS OF, AND SUBJECT TO THE CONDITIONS IN, THE MASTER
SERVICES AGREEMENT AND THIS AGREEMENT, INCLUDING WITHOUT LIMITATION SERVICES
PROVIDED PURSUANT TO SUBSECTIONS 5.C, 5.D AND 5.E, AND 5.F HEREOF. SUCH PAYMENTS
SHALL BE IN ADDITION TO THE NEXTEL PAYMENT (AS DEFINED IN SECTION 6 BELOW).

 

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6.             NEXTEL PAYMENT. NEXTEL SHALL PAY TO METRO ONE THE AGGREGATE SUM
OF EIGHT MILLION TWO HUNDRED FIFTY THOUSAND AND 00/100 DOLLARS ($8,250,000.00)
IN INSTALLMENTS (THE “NEXTEL PAYMENT”). THE FIRST INSTALLMENT OF NEXTEL PAYMENT
IN THE AMOUNT OF $2,500,000.00 WAS PAID BY NEXTEL TO METRO ONE ON OR ABOUT
DECEMBER 14, 2005.

 

A.             REMAINING NEXTEL PAYMENT. THE REMAINING NEXTEL PAYMENT IN THE
AMOUNT OF $5,750,000 (THE “REMAINING NEXTEL PAYMENT”) SHALL BE PAID IN THREE (3)
INSTALLMENTS, AS FOLLOWS, AND ON THE DATES SPECIFIED BELOW (EACH A “NEXTEL
PAYMENT DATE”):

 

(i)                                     $1,916,668.00 no later than March 20,
2006; and

 

(ii)                                  $1,916,666.00 no later than twenty (20)
days after the February, 2006 Report Date; and

 

(iii)                               $1,916,666.00 no later than twenty (20) days
after the March, 2006 Report Date.

 

B.             EXTENSION OF NEXTEL PAYMENT DATES. IF ANY TERMINATION DATE MUST
BE EXTENDED AS A RESULT OF ANY ACT OR OMISSION WITHIN THE SOLE CONTROL OF METRO
ONE, THEN ANY UPCOMING NEXTEL PAYMENT DATE HEREUNDER SHALL BE EXTENDED ONE (1)
DAY FOR EVERY DAY THAT SUCH TERMINATION DATE MUST BE EXTENDED AS A RESULT OF
SUCH ACT OR OMISSION. THE EXTENSION OF UPCOMING NEXTEL PAYMENT DATES AS PROVIDED
HEREIN SHALL NOT, STANDING ALONE, ENTITLE NEXTEL TO WITHHOLD ANY INSTALLMENT OF
THE REMAINING NEXTEL PAYMENT, WHETHER IN ACCORDANCE WITH SECTION 6.D HEREOF OR
OTHERWISE.

 

C.             ADJUSTMENTS TO REMAINING NEXTEL PAYMENT. IF, FOLLOWING THE
EXECUTION DATE OF THIS AGREEMENT, SERVICE LEVELS ARE NOT MET BY METRO ONE FOR
ANY REPORTING PERIOD, AND NEXTEL IS ENTITLED TO ANY ADJUSTMENT CREDITS PURSUANT
TO SECTION 6.3 OF THE MASTER SERVICES AGREEMENT AND SCHEDULE 2.4 THEREOF AS TO
SUCH MISSED SERVICE LEVELS, ANY SUCH CREDITS SHALL NOT ONLY BE APPLIED TO THE
AMOUNTS DUE METRO ONE UNDER THE MASTER SERVICES AGREEMENT, BUT ALSO TO THE
INSTALLMENT OF THE REMAINING NEXTEL PAYMENT DUE FOR SUCH REPORTING PERIOD. THE
APPLICATION OF ADJUSTMENT CREDITS TO SUCH INSTALLMENT OF THE REMAINING NEXTEL
PAYMENT SHALL NOT BE SUBJECT TO THE LIMITATIONS ON THE AT RISK AMOUNT AS SET
FORTH IN SECTION II.C OF SCHEDULE 2.4 OF THE MASTER SERVICES AGREEMENT.

 

D.             NEXTEL ELECTION TO WITHHOLD INSTALLMENT OF REMAINING NEXTEL
PAYMENT. NEXTEL MAY ELECT, IN LIEU OF ITS REMEDIES IN THE SUBSECTION 6.C, ABOVE,
TO WITHHOLD PAYMENT OF THE INSTALLMENT OF THE REMAINING NEXTEL PAYMENT
APPLICABLE TO A REPORTING PERIOD IF METRO ONE FAILS TO MEET THE STANDARDS
PRESCRIBED IN SCHEDULE 2.4 OF THE MASTER SERVICES AGREEMENT FOR THE SERVICE
LEVELS DESCRIBED THEREIN AS “ACCESSIBILITY,” “SPEED OF ANSWER,” “ABANDON RATE,”
“LISTING ACCURACY,” OR “SERVICE QUALITY” ON:

 

(i)                                     six (6) or more occasions during
January, 2006; or

 

(ii)                                  four (4) or more occasions during the
February, 2006, Reporting Period; or

 

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(iii)                               three (3) or more occasions during the
March, 2006 Reporting Period;

 

provided, however, that, if Nextel fails to meet any one of the Planned
Transition Dates set forth in Schedule 1 during the February, 2006 or March,
2006 Reporting Periods, Nextel may elect to withhold the installment of the
Remaining Nextel Payment due for such Reporting Period only if Metro One fails
to satisfy the above-described Service Levels on six (6) or more occasions
during the February, 2006 Reporting Period or on six (6) or more occasions
during the March, 2006 Reporting Period, as applicable. Nextel’s election not to
pay an installment of the Remaining Nextel Payment as provided in this
subsection 6.d shall not affect Metro One’s entitlement to receive payments for
Services under the Master Services Agreement during such Reporting Period,
subject to the Adjustment Credits chargeable against such payments under the
Agreement.

 

7.             AMENDMENT OF MASTER SERVICES AGREEMENT. TO THE EXTENT THAT THIS
AGREEMENT IS INCONSISTENT WITH THE TERMS OF THE MASTER SERVICES AGREEMENT, THE
MASTER SERVICES AGREEMENT SHALL BE DEEMED AMENDED TO CONFORM TO THE PROVISIONS
OF THIS AGREEMENT. THE MASTER SERVICES AGREEMENT SHALL OTHERWISE REMAIN IN FULL
FORCE AND EFFECT. THE MASTER SERVICES AGREEMENT SHALL CONTINUE TO GOVERN METRO
ONE’S PROVISION OF, AND NEXTEL’S PAYMENTS FOR, SERVICES FOR SO LONG AS METRO ONE
PROVIDES SERVICES TO NEXTEL UNDER THIS AGREEMENT.

 

8.             ENTIRE AGREEMENT. THIS AGREEMENT, INCLUDING THE EXHIBITS AND
SCHEDULES THERETO, AND, TO THE EXTENT IT IS NOT INCONSISTENT WITH THIS
AGREEMENT, THE MASTER SERVICES AGREEMENT, CONTAIN THE ENTIRE AGREEMENT BETWEEN
THE PARTIES AGREEMENTS WITH REGARD TO THE MATTERS SET FORTH HEREIN AND SUPERSEDE
ANY AND ALL PRIOR AGREEMENTS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, OF THE
PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREIN. THIS AGREEMENT MAY BE
AMENDED ONLY BY WRITTEN INSTRUMENT SIGNED BY THE PARTIES.

 

9.             BINDING AGREEMENT. THIS AGREEMENT IS BINDING UPON AND INURES TO
THE BENEFIT OF THE PARTIES HERETO AND THEIR RESPECTIVE MEMBERS, EMPLOYEES,
AGENTS, SHAREHOLDERS, OFFICERS, DIRECTORS (IN THEIR INDIVIDUAL AND
REPRESENTATIVE CAPACITIES), SUBSIDIARIES, PREDECESSORS, AFFILIATES, PARENT
CORPORATIONS, IF ANY, JOINT VENTURES, SUCCESSORS, ASSIGNS, ADMINISTRATORS, AND
TRUSTEES.

 

10.           CONFIDENTIALITY. THE TERMS AND CONDITIONS OF THIS AGREEMENT SHALL
BE CONSIDERED CONFIDENTIAL INFORMATION UNDER, AND SHALL BE SUBJECT TO,
SECTION 7.3 OF THE MASTER SERVICES AGREEMENT.

 

11.           AUTHORIZATION. EACH PARTY REPRESENTS AND WARRANTS THAT ITS
REPRESENTATIVES EXECUTING THIS AGREEMENT ARE FULLY AUTHORIZED TO DO SO ON ITS
BEHALF AND NEXTEL OPERATIONS, INC. REPRESENTS AND WARRANTS THAT IT IS AUTHORIZED
TO EXECUTE AND DELIVER THIS AGREEMENT FOR AND ON BEHALF OF NEXTEL OF CALIFORNIA,
INC., NEXTEL COMMUNICATIONS OF THE MIDATLANTIC, INC., NEXTEL OF NEW YORK, INC.,
NEXTEL SOUTH CORP., NEXTEL OF TEXAS, INC. AND NEXTEL WEST CORP.

 

12.           DEFINED TERMS. ANY CAPITALIZED TERM USED, BUT NOT DEFINED, HEREIN
SHALL HAVE THE MEANING ASCRIBED TO IT BY THE MASTER SERVICES AGREEMENT.

 

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13.           EFFECT OF SECTION HEADINGS. THE SECTION HEADINGS APPEARING IN THIS
AGREEMENT ARE INSERTED FOR THE PURPOSE OF CONVENIENCE AND REFERENCE AND SHALL
NOT BE CONSTRUED TO DEFINE, LIMIT OR EXTEND THE SCOPE OF INTENT OF THE LANGUAGE
OF THE SECTIONS TO WHICH THEY PERTAIN.

 

14.           COUNTERPARTS. THIS AGREEMENT MAY BE EXECUTED IN COUNTERPARTS, EACH
ONE OF WHICH SHALL BE DEEMED AN ORIGINAL, AND ALL OF WHICH TOGETHER SHALL BE
DEEMED THE SAME AGREEMENT.

 

15.           NO ADMISSIONS:  NOTHING HEREIN SHALL BE DEEMED AN ADMISSION OR
ACKNOWLEDGEMENT OF LIABILITY OR WRONGDOING BY ANY PARTY.

 

IN WITNESS WHEREOF, the Parties by and through their duly authorized
representatives, have entered into, and executed, this Agreement as of the date
first set forth above.

 

 

 

METRO ONE TELECOMMUNICATIONS,
INC.

 

 

 

 

 

By:

 

 

 

 

Title:

 

 

 

 

Printed:

 

 

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METRO ONE TELECOMMUNICATIONS,
INC.

 

 

 

 

 

By:

 /s/ James M. Usdan

 

 

 

Printed:

James M. Usdan

 

 

 

Title:

  President and CEO

 

 

 

 

 

NEXTEL OPERATIONS, INC. (for itself and as authorized agent for and on behalf of
NEXTEL OF CALIFORNIA INC., NEXTEL COMMUNICATIONS OF THE MIDATLANTIC, INC.,
NEXTEL OF NEW YORK, INC., NEXTEL SOUTH CORP, NEXTEL OF TEXAS INC. AND NEXTEL
WEST CORP.)

 

 

 

 

 

By:

/s/ John Craine

 

 

 

Printed:

John Craine

 

 

 

Title:

Sr. Director, Supply Chain Management

 

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