Customer Dividend Policy

Guadalupe Valley Communications Systems, L.P.
Customer Dividend Program (“CDP”)
Terms and Conditions

Guadalupe Valley Communications Systems, L.P. (“GVCS”), a subsidiary of Guadalupe Valley Telephone Cooperative, Inc. (“GVTC” or the “Cooperative”), provides internet, television, phone, and security services to customers inside and outside of the Cooperative’s service area. In July 2024, GVCS adopted and implemented a Customer Dividend Program or “CDP” allowing it to pay dividends to qualifying GVCS customers (“Customer Dividends”).

Customer Dividends are payable at the sole discretion of the Board of Directors (“Board”) of GVCS’s General Partner, Guadalupe Valley Enterprises, Inc. (“GVE”), consistent with these CDP Terms and Conditions, GVCS’s Amended and Restated Agreement of Limited Partnership (the “LPA”), and applicable Board policies, as each may be amended from time-to-time. Customer Dividends are distributed in the form of credits applied to customer accounts and are reflected on applicable GVCS bills.

Additional terms, conditions, and restrictions applicable to GVCS’s Customer Dividend Program are set forth below. The Customer Dividend Program as well as any Customer Dividends or other payments to be allocated, awarded or paid thereunder may be modified or eliminated at any time by the Board in the sole discretion and determination by the Board. Any changes to these CDP Terms and Conditions will be effective when posted on the GVTC website at https://www.gvtc.com/policies.

Qualifying Customers. Only GVCS’s residential and business retail customers qualify for participation in the Customer Dividend Program. For clarity, wholesale and enterprise customers are not “business retail customers” and do not qualify for participation in the Customer Dividend Program. To participate in the Customer Dividend Program, qualifying customers must have a valid Social Security Number or Taxpayer Identification Number associated with their account, must be current on all payments, and must otherwise be in compliance with the terms applicable to their GVCS service, including those published at the link above.

Customer Dividend Interest. The Board has established, for dividend allocation purposes, a separate class of GVCS partnership interest as reflected in the financial records of GVCS (the “Customer Dividend Interest”). The Customer Dividend Interest is an uncertificated interest retained for GVCS’s internal bookkeeping purposes only, has no voting or liquidation rights, and is not otherwise a property interest to which any legal rights apply. The sole function of the Customer Dividend Interest is to facilitate the dividend declaration, as determined by the Board. Once declared, Customer Dividends are then allocated to qualifying customers as bill credits against designated service fees, subject to these CDP Terms and Conditions.

Customer Dividend Declaration and Issuance. The Board anticipates declaring Customer Dividends in the aggregate on the Customer Dividend Interest. The aggregate Customer Dividend, if declared, will then be allocated to qualifying GVCS customers on the basis of usage of and/or fees for designated GVCS services. Customer Dividends will be distributed in the form of credits applied to customer accounts and will be reflected on applicable GVCS bills. Customer Dividends are not payable as cash and are not transferrable or assignable. GVCS Customers have no right to receive distributions, dividends, or other payments with respect to the Customer Dividend Program except where a Customer Dividend is declared by the Board in the aggregate and then only to the extent such Customer Dividend is allocated and credited to the customer’s account as determined by the Board.

Customer Dividends Taxable. Customer Dividends are subject to federal income tax. Recipients will receive 1099s annually from GVCS for Customer Dividend amounts credited to their account(s).

Customer Opt-Out and Removal. GVCS customers may opt out of the Customer Dividend Program at any time on written notice to GVCS in the manner directed by GVCS on its website. GVCS customers can also be removed from the Customer Dividend Program at any time, including due to a failure by a customer to provide a valid Social Security Number or Taxpayer Identification Number or other information as may be requested for GVCS to comply with applicable tax or reporting requirements or due to a customer’s failure to remain current on payment or to otherwise be in compliance with the terms applicable to their GVCS service, including those published at the link above.

Limitation of Liability. TO THE FULLEST EXTENT PERMITTED UNDER APPLICABLE LAW, THE LIABILITY OF GVCS, GVE, GVTC, AND ANY OF THEIR DIRECTORS, OFFICERS, OR EMPLOYEES (INDIVIDUALLY A “GVCS PARTY” OR COLLECTIVELY, THE “GVCS PARTIES”) FOR ANY LOSS OR DAMAGE ARISING OUT OF THE CUSTOMER DIVIDEND PROGRAM, INCLUDING, WITHOUT LIMITATION, ANY CLAIM FOR ANY GVCS PARTY’S ALLEGED FAILURE TO COMPLY WITH THESE CDP TERMS AND CONDITIONS, GVCS’ LPA (OR ANY SUBSEQUENT AMENDMENT OR RESTATEMENT), ANY BOARD POLICY, OR ANY OTHER ORGANIZATIONAL OR GOVERNING DOCUMENT OR POLICY OF ANY OF THE GVCS PARTIES OR ANY CLAIM FOR ANY GVCS PARTY’S ALLEGED FAILURE TO COMPLY WITH THE APPLICABLE REQUIREMENTS OF THE TEXAS BUSINESS ORGANIZATIONS CODE, ANY OTHER STATUTE APPLICABLE TO THE GOVERNANCE OF ANY GVCS PARTY, OR THE GVCS PARTY’S ALLEGED DUTIES UNDER ANY SUCH STATUTE OR THE COMMON LAW PRINCIPLES APPLICABLE TO THE GVCS PARTIES, IF ANY, SHALL IN NO EVENT EXCEED AN AMOUNT EQUIVALENT TO THE CUSTOMER DIVIDEND PAID TO SUCH CUSTOMER IN THE MONTH PRECEDING THE CLAIM OR IF NO SUCH CUSTOMER DIVIDEND WAS PAID, $100.00.

WITHOUT LIMITING THE ABOVE, TO THE FULLEST EXTENT PERMITTED UNDER APPLICABLE LAW, THE GVCS PARTIES SHALL HAVE NO LIABILITY OR OBLIGATION, IN EITHER CONTRACT OR TORT, FOR SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND, SUCH AS, BUT NOT LIMITED TO, CLAIMS OR DAMAGES FOR PERSONAL INJURY, WRONGFUL DEATH, LOSS OF USE, LOSS OF ANTICIPATED PROFITS, OR OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGES OR ECONOMIC LOSSES OF ANY KIND INCURRED DIRECTLY OR INDIRECTLY RESULTING FROM OR RELATED TO THE CUSTOMER DIVIDEND PROGRAM DESCRIBED HEREIN.

Indemnification and Release. To the fullest extent permitted by applicable law, each GVCS customer agrees to release, defend, indemnify and hold the GVCS Parties harmless from and against any and all claims, damages, liabilities and expenses, including legal and attorneys’ fees, of any nature arising directly or indirectly out of the customer’s participation (or claimed right to participate) in the Customer Dividend Program and/or the calculation, payment or alleged nonpayment of any Customer Dividends or other amounts or interests, and all other such matters otherwise arising directly or indirectly out of the GVCS customer relationship applicable in any respect hereto, whether the claim is based in whole or in part on negligent acts or omissions of one or more GVCS Parties or its/their agents.

No Property Right. The Customer Dividend Interest is not offered for sale or subscription and affords no property rights or other rights or interests in GVCS as a partner or otherwise. Without limiting the generality of the foregoing, GVCS customers have no right to claim ownership of a partnership interest, to receive any internal or confidential information concerning GVCS or any of its affiliates, to be advised of or to vote on any matter affecting GVCS or any of its affiliates, or to receive any proceeds in respect of the interest outside of Customer Dividends (which are in all cases subject to these CDP Terms and Conditions). The existence of the Customer Dividend Interest also does not create any fiduciary or other duty between GVTC, GVE, GVCS, or any of their directors, officers, or employees and any customer, with all such duties, to the extent they exist, being hereby eliminated or restricted to the fullest extent permitted under applicable law. The Board may increase, decrease, or eliminate the Customer Dividend Interest at any time with or without notice. Any elimination or discontinuance of the Customer Dividend Program will result in an automatic redemption or elimination of the Customer Dividend Interest without further action by the Board or further notice to the GVCS customers.

Not Assignable. Neither the Customer Dividends nor any right or claimed right to receive Customer Dividends (under CDP Terms and Conditions or otherwise) shall be assignable by a customer except with GVCS's prior written consent, which may be withheld, conditioned or denied for any reason. The terms, restrictions, and conditions applicable to the Customer Dividend Program, including those set forth in these CDP Terms and Conditions, shall bind any permitted heirs, successors and assigns of a customer.

Entire Agreement; Governing Law and Venue; Waiver of Jury Trial and Class Actions. Each GVCS customer acknowledges that these CDP Terms and Conditions contain the entire understanding with customer relating to the Customer Dividend Program and that no GVCS Party has made orally or in writing any representations, warranties, or agreements inconsistent with the terms, restrictions, and conditions herein. These CDP Terms and Conditions supersede all prior understandings, if any, whether oral or written, with respect to the subject matter hereof. The Board may rescind or modify these CDP Terms and Conditions at any time. A customer’s continued use of GVCS services or other participation in the Customer Dividend Program following a modification signifies the customer's acceptance of the modified terms, restrictions, and conditions. These CDP Terms and Conditions shall be governed by, construed and enforced in accordance with the laws of the state of Texas, and exclusive venue for any action arising out of or related to the Customer Dividend Program or these CDP Terms and Conditions (including any agreement or policy incorporated herein) shall be in the state and/or federal courts sitting in Comal County, Texas. EACH GVCS CUSTOMER WAIVES ANY RIGHT HE OR SHE MAY HAVE TO A TRIAL BY JURY AND FURTHER WAIVES ANY RIGHT HE OR SHE MAY HAVE TO BRING ANY SUCH ACTION AS A CLASS ACTION OR TO SERVE AS A CLASS REPRESENTATIVE IN ANY SUCH ACTION.

Severable Provisions. If any part of these CDP Terms and Conditions is contrary to or prohibited by or deemed invalid under applicable laws and regulations of any applicable jurisdiction, the remaining provisions and parts thereof shall remain and be construed in full force and effect to the extent permitted by law.