LightSquared 4G State of ND

1. LightSquared 4G State of ND • Capabilities Update • Better “DCN wireless” idea? • Current Issues • Objectives • Strategy

2. Capabilities Update • FCC • New USF get support for DSL replacement • Own netowrk like DCN • PSST Support • PSST will support LTE technology • PSST • North Dakota Influence • We can meet Governors Staff • Proposal Development

3. No Duplicate Funding Issues • Duplicate funding rules Grant Programs • Public Safety only networks are middle Mile, not last mile • Coops can apply for last mile funding without duplication • apply as a group for a BTOP Public Safety waiver, circumventing the funding restrictions as defined by (Served, Un-served & Underserved) • Flows PS & Commercial, is considered Middle & Last mile • Governor establishes priority for BTOP Grants

4. Review Objective • Initial Objectives • Win the Grant & Prevent Flow from getting funds • Build network that we control • Service Public Safety initially • Eventually commercial in your territory

5. Problems with Initial objectives • Flow Mobile has achieved: • General Sprynczynatyk (Nat Guard) signed agreement with Flow • Governor has publicly supported Flow • NENA & APCO local chapters support Flow • General Sprynczynatyk filed a second waiver to the FCC • Demonstrated the 700 MHz to the Governor (Coops None) • Project cost estimated at $35 million (Coops $~50 Million) • Significant ND Governmental inertia • Coop Objections to Objective • Don’t want to compete with Verizon • Will request funds for own FTTH or Wireless projects • Don’t want to be subject to Duplicate Funding Rule

6. Revised Objectives • Oppose at PSST & FCC (Good Chance) • Beat the waiver for spectrum allocation (Narrow Band) • Beat the waiver for spectrum use (Commercial) • Beat the D block request • ND Governor • Get the Governor to publically agree to a beauty content • The beauty contest needs to go beyond the 14th • Our individual ILEC submission must be in on the 14th

7. Strategy Discussion • Initial Proposal • Build a new network $50 Million, 141 towers • Alternative Proposal • Partner with Verizon • Pay for the Public Safety Radios and CPE on Verizon’s 4G network, at an estimated cost $12 million

8. Beauty Contest • Get the Governor to publicly agree to a beauty contest that will push us beyond the 14th. • Verizon is credible • Coops are credible • Only Public Safety, Middle mile only • No adverse waivers needed, PSST will support • PSST Inter-Operable • $12 million, cheaper than either of other proposals.

9. Now What! • Fight the Waiver • Oppose at PSST • Delay the Governor’s support • What do we propose to the Governor? • Who is onboard ?

10. Proposal Comparison

11. Proposal Comparison

12. Proposal Comparison

13. Proposal Comparison

14. Would Verizon Participate? • We would request early deployment of 4G • We would make it financially attractive • Why would Verizon consider it? • Would move the build forward, ahead of the ATT conversion of ALLTEL to GSM • Prevent the funding of a Verizon Competitor using Grant money • Guarantee the state broadband agreement worth $1.9 mm & bundle with voice agreement of similar value • City of Fargo uses ALLTEL, not Verizon • Growth of state subscribers would increased USF • Demonstrate a great model for them to duplicate