Local News

Settlement With Qwest Costs USLEC $3 Million Plus Commitment To Order Services

Posted August 14, 2006

— Telecommunications provider

US LEC

(Nasdaq: CLEC) paid Qwest Communications $3 million in order to settle a legal dispute with the other telecommunications firm.

US LEC also agreed to buy a certain amount of services from Qwest, US LEF disclosed Friday in a filing with the Securities and Exchange Commission.

On Thursday, US LEC issued a press release saying the legal dispute had been resolved but disclosed no other details. The Charlotte-based company, which provides data and communications services to businesses across 16 states, has been embroiled in lawsuits with other carriers about billing related to intrastate and interstate access charges.

In addition to the $3 million, US LEC "agreed to order telecommunication services from Qwest, between August 1, 2006 and November 30, 2009 unless US LEC meets the purchase commitment earlier, at volume levels and rates comparable to those that existed in the past with Qwest and at prices comparable to other national carriers" US LEC said in the filing.

"US LEC would be subjected to substantial penalties in the event of early termination of its commitment or in the event it fails to order the agreed upon annual commitment during the term. It is not expected that the purchase commitment with Qwest will require US LEC to order or pay more than it otherwise would have ordered from or paid to third party carriers during this same period of time," the company added.

The two firms also agreed to a framework for billing and collection of access charges from US LEC to Qwest, the filing said.

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