Exhibit 10.17
MANAGEMENT AGREEMENT
This MANAGEMENT AGREEMENT ("Agreement") is made as of December 29, 2000
between Adelphia Business Solutions Operations, Inc., a Delaware corporation
(the "Manager") and ACC Operations, Inc., a Delaware corporation (the
"Company").
Manager has experience and expertise in the construction, design,
engineering, maintenance, operation, management, marketing, regulatory
processing, accounting, financial reporting and network monitoring associated
with competitive local telecommunications networks and local switch networks.
The Company provides competitive local telecommunications and all switch
related business services and desires to have the Manager manage the provision
of these services for the Company's network and local switch network in the
geographic areas listed on Schedule I attached hereto and made a part hereof
(the "Network") under the direction and control of the Company. The Company, the
Manager and their respective affiliates collectively own all necessary federal,
state or local franchises, licenses, permits or other governmental
authorizations in connection with the ownership and operation of the Network.
Manager is willing to provide such management services on the terms and
subject to the conditions contained in this Agreement.
In consideration of the foregoing and intending to be legally bound
hereby, the Manager and the Company agree as follows:
1. Appointment of Manager.
Subject to the Company's oversight, review, supervision and control, the
Company hereby appoints the Manager as its sole and exclusive agent to manage
and supervise the development and operation of the Network during the term of
this Agreement with those powers, authority and duties that are specified
herein. The Manager hereby accepts such appointment and agrees to perform its
obligations and responsibilities hereunder. The Manager acknowledges that all
facilities and equipment used or employed in the development, construction and
operation of the Network, other than leased equipment or equipment owned by the
Manager or other contractors, shall remain the property of the Company and the
Company shall have the unfettered use and ownership of all such facilities and
equipment. The Manager further acknowledges that all of the employees of the
Company are employed solely by the Company and the Manager shall not direct any
of such employees to take any action or perform any task that is not for the
direct benefit of the Company. The Manager shall devote such time and resources
as are necessary to ensure proper and efficient operation of the Network and
shall make available to the Network the full range of its expertise and
experience. The Company hereby grants to the Manager complete access or, if
less, as much access as the Company has to all of the fiber optic and other
facilities which are owned or leased by the Company and which constitute the
Network in order to permit Manager to perform its obligations hereunder.
2. Services.
(a) General. Subject to the oversight, review, supervision and control of
the Company and subject to all applicable laws and regulations, the Manager
shall be responsible for the development, planning, management and operation of
the Network. To this end, the Manager shall provide supervision of all (i)
administrative, accounting, billing, credit, collection, insurance, purchasing,
clerical, financial reporting and such other general services as may be
necessary to the administration of the Network; (ii) operational, engineering,
maintenance, repair and such other technical services as may be necessary to the
construction and operation of the Network; (iii) sales, advertising and such
other promotional services as may be necessary to the marketing of the Network;
and (iv) legal and regulatory compliance of the Company and the Network
including the filings of tariffs required by applicable state and federal
regulatory agencies. Consistent with the foregoing and with sound commercial
practice, the Manager shall use its best efforts to render or obtain such
services and perform or cause to be performed such duties as shall be necessary
or appropriate for the construction, management and operation of the Network,
including, without limitation, those duties as are more specifically set forth
on Schedule II annexed hereto and made a part hereof. All of such services shall
be rendered by the Manager subject to the approval of the Company.
(b) Consolidation of Purchases. In arranging for the provision of goods
and services to the Company, including without limitation the services referred
to in Subsection 2(a) hereof, the Manager may make arrangements to consolidate
the purchase of such goods and services with purchases for other facilities or
systems operated or managed by the Manager; provided that all such purchases are
on terms no less favorable than those that could reasonably be obtained by the
Company on an unconsolidated basis and that the Company shall not reimburse the
Manager for any costs for such goods or services in excess of the Manager's
direct, out-of-pocket costs therefor.
(c) Agency. All actions taken by the Manager under the provisions of
Subsection 2(a) hereof shall be taken as agent of the Company.
(d) Consent Required. Notwithstanding any provision to the contrary in
this Agreement or in Schedule II, the Manager shall not, without the prior
written consent of the Company:
i. settle or initiate any claim or litigation involving the
Network;
ii. enter into any collective bargaining contract or personal
service agreement with any employee or employees of the Company;
iii. lend money on behalf of the Company, or assign, transfer, or
pledge any debts due the Company, or release or discharge any debt due or
compromise any claim exceeding $25,000;
iv. enter into any joint venture, arrangement or business
enterprise on behalf of the Company, or obligate the Company to any undertakings
other than those in the ordinary course of business of the Network;
v. enter into any transaction with any affiliate of the Manager
or the Company;
vi. knowingly take or fail to take any action that violates (i)
any law, rule or regulation relating to the Network; (ii) any agreement,
arrangement or undertaking to which the Company is a party; (iii) any federal,
state or local franchise, license, permit or other governmental authorization
granted to the Company, the Manager or any of their respective affiliates in
connection with its ownership and operation of the Network; or (iv) any judicial
or administrative order or decree to which the Company is subject or by which
any of the Company's properties or assets are bound;
vii. sell, assign, transfer or otherwise dispose of, or
hypothecate or encumber in any way, any assets belonging to the Company other
than in the ordinary course of business or where no longer useful in the
business or operations of the Network;
viii. take any action to obtain or amend or agree to amend any
federal, state, or local franchise, license, permit, or other governmental
authorization granted to the Company, the Manager or any of their respective
affiliates in connection with its ownership and operation of the Network;
ix. borrow money on behalf of the Company or negotiate or enter
into other forms of financing for the Network, including any capital lease,
other than customer credit agreements with persons who supply goods or services
to the Network;
x. amend any lease of any fiber optic facilities entered into by
the Company; or
xi. cause or permit the Company to exceed its capital or expense
Budget (as such term is defined in Schedule II) by more than fifteen percent
(15%) for any calendar year.
3. Regulatory Compliance. The Manager is expressly authorized to provide the
services contemplated herein, and recognizes that each of the Company and the
Manager is or may be required to be licensed or otherwise authorized by federal
and state regulatory authorities with respect to its business activities as they
relate to the Network At the Company's request, the Manager shall apply for or
supervise the applications of the Company for any such licenses and shall
prepare and submit or supervise the preparation and submission of all regulatory
filings, including tariffs. Without limiting the generality of the foregoing, if
any regulatory authority or agency determines that any provision of this
Agreement violates any rule, policy or regulation, both parties shall make
good-faith efforts immediately to correct the problem and to bring this
Agreement into compliance.
4. Company Responsibilities.
(a) Information and Equipment. The Company shall provide Manager, at the
Network or, to the extent necessary, at the Manager's network monitoring and
control center ("NCC"), with all information, local equipment and software and
connecting facilities necessary to allow the Manager to provide the services for
the Network described in Section 2, including without limitation those set forth
on Schedule II, and cooperate and comply with the procedures
developed to implement those services. Additional sites to be monitored by the
Manager pursuant to Schedule II may be added on at least five (5) business days'
notice to the NCC. All equipment to be monitored at the Network by the Manager
must be approved by the Manager as compatible with its monitoring system. The
Manager shall purchase the equipment and connecting facilities on behalf of the
Company as part of the construction of the Network.
(b) Compliance with FCC Licenses, Franchises, and Permits. Notwithstanding
anything in this Agreement to the contrary, the Company, the Manager or any of
their respective affiliates shall, as applicable, continue to be the franchisee,
licensee and permittee of all federal, state, or local franchises, licenses,
permits and other governmental authorizations that are necessary to the conduct
of the business or operations of the Network (collectively, the "Licenses"). The
Company and the Manager shall each retain ultimate responsibility for compliance
with the laws and the rules, regulations and policies of the Federal
Communications Commission and all state and local regulatory authorities for
those Licenses respectively by them. The Company and the Manager agree to remain
in compliance with the rules, regulations and policies of all governmental
authorities from which the Company, the Manager or any of their respective
affiliates has received Licenses. Unless otherwise agreed to by the Company and
the Manager in writing, the Company and the Manager agree that they shall not
take any action that would violate any License or that could reasonably be
expected to cause the cancellation, revocation, or adverse modification of any
License or that could be expected to otherwise impair the good standing or
renewal of any License.
(c) Maintaining Licenses. The Company and the Manager, as applicable,
shall take or cause to be taken all reasonable and appropriate steps necessary
to keep the Licenses in full force and effect and in good standing. The Company
and the Manager shall prepare and submit to each relevant authority all reports,
applications, renewals, filings or other documents necessary to do so and
respond promptly to all regulatory correspondence or inquiries and any and all
adversarial pleadings of whatever nature filed with the FCC or any State or
local authority and each will immediately notify the other of the receipt
thereof.
5. Payments.
(a) Fees. In consideration for the services to be performed herein, the
Company shall pay to the Manager an ongoing fee per month of $60,000, increasing
by four percent per year for the term of this Agreement. The Company shall pay
such fee in equal monthly installments on the first day of each calendar month
during the term of this Agreement. Furthermore, the Manager will be eligible for
a quarterly performance bonus based on the recommendations of the Company. In
accordance with the above terms and conditions a mutually agreed upon bonus plan
will be initiated.
(b) Expense Reimbursement. Subject to the Budgets (as defined in Schedule
II), the Company shall reimburse the Manager for travel, meals, lodging and
other reasonable out-of-pocket expenses incurred in carrying out the duties and
responsibilities of the Manager in this Agreement upon verification and
provision of appropriate records. Subject to the Budgets, the Company shall also
reimburse the Manager for costs associated with outside accounting, tariff and
legal services that may be required beyond the normal day-to-day management and
operation of the Network.
6. Term.
(a) Renewal. This Agreement shall commence on December 31, 2000 and,
subject to Section 6(b) hereof, the initial term of this Agreement shall end on
the day prior to the third anniversary of the date of commencement. This
Agreement shall automatically renew thereafter for additional periods of three
(3) years, unless either party notifies the other, in writing, at least sixty
(60) days prior to the then current term of its intention that such renewal
shall not occur.
(b) Automatic Termination. Notwithstanding the foregoing, this Agreement
shall terminate on the earliest to occur of (i) thirty (30) days after the date
that the Company's or the Manager's legal ability to operate the Network
terminates or is materially impaired; provided, however, that if such party can
cure the defect and commence operations within the thirty-day period specified
herein, this Agreement shall not terminate under this subparagraph (i), (ii) the
date this Agreement terminates pursuant to Section 9 hereof, or (iii) the date
in which either the Company or the Manager incur a Change of Control (as defined
below), unless both parties agree prior to such Change of Control that upon the
expiration of the then current term to renew this Agreement for an additional
six (6) years.
(c) Definitions. For purposes of this Agreement, a "Change of Control"
shall be deemed to have occurred with respect to the Company if, after the date
hereof, members of the Xxxx Xxxxx family fail to collectively (i) own directly
or indirectly at least 50.1% of the outstanding voting stock of Adelphia
Communications Corporation, a Delaware corporation ("Adelphia"), or (ii) have
the ability, directly or indirectly, to select a majority of the members of the
Board of Directors of Adelphia. A "Change of Control" shall be deemed to have
occurred with respect to the Manager if, after the date hereof, Adelphia fails
to (i) own directly or indirectly at least 50.1% of the outstanding voting stock
of Adelphia Business Solutions, Inc., a Delaware corporation ("ABS"), or (ii)
have the ability, directly or indirectly, to select a majority of the members of
the Board of Directors of ABS.
7. Proprietary Information. Each party acknowledges that, in the course of
the performance of this Agreement, it may have access to privileged and
proprietary information claimed to be unique, secret and confidential, and which
constitutes the exclusive property or trade secret of the other, and the parties
acknowledge that they are in a confidential relationship with each other. To the
extent that (a) any information is marked with a restrictive notice or otherwise
tangibly designated as proprietary or (b) the disclosing party advises the
receiving party orally or in writing that information is proprietary, the
receiving party agrees to maintain the confidentiality of the proprietary
information and to use the same degree of care as it uses with regard to its own
proprietary information to prevent the disclosure, publication or unauthorized
use of the proprietary information. Neither party may duplicate or copy
proprietary information of the other party other than to the extent necessary
for legitimate business uses in connection with this Agreement. The receiving
party shall be excused from these nondisclosure provisions if (a) the receiving
party can demonstrate the proprietary information has been, or is subsequently,
made public by the disclosing party or is independently developed by the
receiving party, (b) the disclosing party gives its written consent to the
disclosure of the proprietary information, or (c) the disclosure is required by
law. The provisions of this Section shall survive the termination or expiration
of the term of this Agreement.
8. Representations and Warranties.
(a) The Company hereby represents and warrants to the Manager as
follows:
i. the Company is duly organized and validly existing in the
State of Delaware and is duly qualified as a foreign corporation in any state
where such qualification is necessary;
ii. the Company has full power and authority to enter into this
Agreement and perform its obligations hereunder;.
iii. the execution, delivery and performance of this Agreement and
all other agreements and transactions contemplated hereby have been duly
authorized by the Company and do not violate the organization documents or any
other agreement to which the Company is a party or by which it or the Network is
bound; and
iv. this Agreement constitutes a legal, valid and binding
obligation of the Company, enforceable against it in accordance with its terms
(except as enforcement may be limited by bankruptcy or insolvency laws).
(b) The Manager hereby represents and warrants to the Company as
follows:
i. the Manager is duly organized, validly existing and in good
standing under the laws of the State of Delaware and is duly qualified to
conduct business in any state where such qualification is necessary;
ii. the Manager has full power and authority to enter into this
Agreement and perform its obligations hereunder;
iii. the execution, delivery and performance of this Agreement and
all other agreements and transactions contemplated hereby have been duly
authorized by the Manager, and do not violate the Certificate of Incorporation
or the Bylaws of the Manager or any other agreement to which the Manager is a
party or by which it or its assets are bound; and
iv. this Agreement constitutes a legal, valid and binding
obligation of the Manager, enforceable against it in accordance with its terms
(except as enforcement may be limited by bankruptcy or insolvency laws).
9. Events of Default and Remedies.
(a) Events of Default.
i. By the Company. The Company shall be in default under this
Agreement if it fails to make any payment pursuant to Subsection 5(a) or 5(b)
hereof within thirty days after the date on which such payment was due unless,
in the case of a payment pursuant to Subsection 5(b) hereof, the same shall be
contested in good faith.
ii. By Either Party. A party shall also be in default under this
Agreement upon the occurrence of any of the following events (regardless whether
any such event is voluntary or involuntary or occurs by operation of law or
pursuant to any judgment, decree, order, rule or regulation of any court or
administrative or governmental body):
a. the failure of such party to perform or observe in any
material respect any covenant or agreement to be performed or observed by it
hereunder, including, without limitation, those referred to on Schedule II
annexed hereto and made a part hereof, and the continuation of such failure for
a period of thirty days after such party receives written notice thereof;
provided, however, that no such notice shall be required if, in the reasonable
business judgment of the other party, such failure is willful or could
jeopardize the economic viability of the other party;
b. the entering by a court or governmental authority of
competent jurisdiction of an order appointing a custodian, receiver, trustee,
intervenor or other officer with similar powers with respect to such party or
with respect to any substantial part of its property, or constituting an order
for relief or approving a petition in bankruptcy or insolvency under the law of
any jurisdiction, or ordering the dissolution, winding up or liquidation of such
party, provided that any such petition that is filed involuntarily against such
party is not dismissed within sixty (60) days thereafter, or an order shall have
been issued granting such party a suspension of payments under applicable law
and any such order is not dismissed within sixty (60) days thereafter;
c. such party or any of its affiliates ceasing to have any
one or more of the material franchises, licenses, agreements, certificates,
concessions, permits, rights or privileges material to the conduct of the
business and operations of the Network or the Manager, as the case may be, if
(1) the loss is not remedied by the obtaining of a replacement franchise,
license, agreement, certificate, concession, permit, right, or privilege within
sixty (60) days of the loss thereof and (2) the loss has a material adverse
effect upon the ability of either party to perform its obligations hereunder; or
d. any of the representations or warranties of such party
contained herein shall cease to be true in any material respect.
iii. By the Manager. The Manager shall be in default under this
Agreement upon the occurrence of any of the following events:
a. Failure to meet the reasonably defined telephony
standards as defined by Belcore and the continuation of such failure for a
period of thirty (30) days after the Manager receives written notice thereof
from the Company,
b. Exceeding the capital or expense Budgets by more than
fifteen percent (15%) for any calendar year without the prior written
authorization of the Company; or
c. Failure to implement any system or provide any services
described in Section 2, including without limitation those set forth on Schedule
II, in accordance with the time table for such systems and services set forth in
the Initial Business Plan of the Network, as amended from time to time by the
Company, without the prior written consent of the Company and the
continuation of such failure for a period of thirty (30) days after the
Manager receives written notice thereof from the Company.
(b) Remedies. Upon the occurrence and during the continuance of any
event of default and expiration of any related cure period, the non-defaulting
party may, at its option, terminate this Agreement by written notice, which
shall be effective immediately. This remedy is not intended to be exclusive, and
all remedies shall be cumulative and may be exercised concurrently with any
other remedy available to Manager or the Company at law or in equity. IN NO
EVENT SHALL EITHER PARTY BE LIABLE FOR SPECIAL, CONSEQUENTIAL, EXEMPLARY OR
PUNITIVE DAMAGES AS A RESULT OF THE PERFORMANCE OR NON-PERFORMANCE OF ITS
OBLIGATIONS UNDER THIS AGREEMENT; PROVIDED, THAT NOTWITHSTANDING ANYTHING TO THE
CONTRARY THE PARTIES HERETO SHALL BE LIABLE FOR SPECIAL OR CONSEQUENTIAL DAMAGES
WHICH RESULT FROM AN INTENTIONAL BREACH BY A PARTY OF ITS MATERIAL OBLIGATIONS
UNDER THIS AGREEMENT WHICH BREACH CONTINUES AFTER NOTICE AND A REASONABLE
OPPORTUNITY TO CURE. ANY NOTICE DELIVERED PURSUANT TO THE PRECEDING SENTENCE
MUST BE IN WRITING AND MUST CLEARLY SPECIFY THAT THE BREACH IS INTENTIONAL AND
SUBJECT TO SPECIAL AND CONSEQUENTIAL DAMAGES UNDER SECTION 9(b) OF THE
MANAGEMENT AGREEMENT.
(c) Other Termination Right. If the Network is not constructed, or does
not operate, in accordance with any one or more of the Budgets, the Company may,
in addition to such other remedies as it may have, terminate this Agreement by
sixty (60) days written notice to the Manager, which shall be effective on the
date specified in the notice.
(d) Performance After Termination. After receipt of written notice of
termination, but prior to the effective date of such termination, the Manager
shall continue to perform under this Agreement unless specifically instructed to
discontinue such performance.
(e) Termination Transition. On the effective date of any termination, or
before such date if so instructed, the Manager shall relinquish to the Company,
or its designee, possession of all property of the Network and the Company,
including but not limited to, all documents, data and records pertaining to the
Network. The Manager and Company shall use their best efforts to ensure a smooth
transition in the event of termination.
10. Indemnification.
(a) General. The Manager shall not be liable for, and the Company shall
indemnify and save and hold the Manager and its officers, members, directors,
employees and agents harmless from and against, any and all damages,
liabilities, costs and expenses (including, but not limited to, reasonable
attorneys' fees and other costs and expenses incident to any suit, proceeding or
investigation or defense of any claim and the time devoted thereto by personnel
of the Manager, whether or not as the result of judicial compulsion)
(collectively, "Claims") resulting from or arising out of this Agreement or the
acceptance or performance of duties or rendering of services by the Manager
under this Agreement, except that the Company shall have no liability hereunder
in respect of any claim relating to any act or omission of the Manager or any of
its affiliates, officers, directors, employees or
agents (i) not taken or made in good faith in the reasonable belief that such
act or omission was in the best interest of the Company or (ii) that constitutes
negligence, gross negligence, recklessness, or willful misconduct. The Manager
shall indemnify and save and hold the Company and its officers, stockholders,
directors, employees and agents harmless from and against any and all Claims
resulting from or arising out of the Manager's negligence, gross negligence,
recklessness or willful misconduct under this Agreement. The indemnifying party
shall advance all costs and expenses incurred by the indemnified party in
defending any claim in advance of the final disposition thereof; provided,
however, that if it is ultimately determined by a court of competent
jurisdiction (from whose decision no appeals may by taken or the time for appeal
has lapsed) that the indemnified party was not entitled to indemnity therefor
hereunder, the indemnified party shall repay all amounts so advanced. The
indemnified party shall deliver to the indemnifying party statements of the
costs and expenses so incurred not more frequently than monthly; and the
indemnifying party shall pay to the indemnified party the amounts shown on such
statements to be due within fifteen (15) days after receipt of such statements.
(b) Procedure. Any party asserting a right to indemnification under this
Section shall so notify the other in writing. If the facts giving rise to such
indemnification involve any actual or threatened claim or demand by or against a
third party, the indemnifying party shall be entitled to control the defense or
prosecution of such claim or demand in the name of the indemnified party, if the
indemnifying party notifies the indemnified party in writing of its intention to
do so within twenty days after its receipt of notice from the indemnified party.
The indemnified party shall have the right, however, at its own expense, to
participate in such proceeding through counsel of its own choosing. Each
indemnified party shall, to the extent requested by the indemnifying party and
at the indemnifying party's expense, cooperate in the prosecution or defense of
any claim and shall furnish any records, information, and testimony and attend
any conferences, discovery proceedings, hearings, trials and appeals that the
indemnifying party reasonably requests in connection therewith.
(c) Survival. The provisions of this Section shall survive the
termination or expiration of the term of this Agreement.
11. Assignment of Rights.
(a) Consent Required. Except as otherwise provided in this Agreement,
neither the Manager nor the Company shall assign its rights under this
Agreement, or the privileges hereby granted, without the consent of the other
party, except that either party may, without the consent of the other party,
assign its rights under this Agreement, or the privileges hereby granted, to a
controlled subsidiary; provided, however, that the assignor shall remain
secondarily liable for payment and performance by its subsidiary hereunder.
(b) Assignments in Writing. Any permitted assignment by the Manager or
the Company shall be in writing and shall state the terms and conditions of the
assignment. The assignee shall agree in writing at the time of the assignment to
keep and abide by all the terms and conditions of this Agreement.
12. Force Majeure. Neither party shall be liable to the other for any failure
of performance under this Agreement due to causes beyond its control, including
fire, flood or other catastrophes; any law, order, regulation, direction,
action, or request of the United States Government, or of any other government,
including state and local governments having or claiming jurisdiction over such
party, or of any department, agency, commission, bureau, corporation or other
instrumentality of any one or more of these federal, state or local governments,
or of any civil or military authority; national emergencies; unavailability of
materials or rights-of-way; insurrections; riots; wars; or strikes, lock-outs,
significant work stoppages or other significant labor difficulties. In the event
of any delay resulting from such causes, upon notice to the other party promptly
following the occurrence of the event giving rise to the delay, the time for
performance hereunder shall be extended for a period of time reasonably
necessary to overcome the effects of such delay.
13. Miscellaneous.
(a) Counterparts. This Agreement may be executed in counterparts each of
which shall be deemed an original and all of which together shall constitute one
and the same instrument; and, in pleading or proving any provision of this
Agreement, it shall not be necessary to produce more than one counterpart.
(b) Captions; Gender. Section headings contained in this Agreement are
for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement. Whenever used herein the singular number shall
include the plural, the plural shall include the singular, and the use of any
gender shall include all genders.
(c) Governing Law and Binding Effect. This Agreement shall be governed
by and construed and enforced in accordance with the internal laws of the
Commonwealth of Pennsylvania applicable to contracts made and to be performed
entirely therein without giving effect to the conflicts of laws principles
thereof. This Agreement shall also be governed by and construed and enforced in
accordance with applicable federal law. This Agreement shall bind and inure to
the benefit of each of the parties and their permitted successors and assigns.
(d) Waivers and Amendments. This Agreement may not be amended nor shall
any waiver, change, modification, consent or discharge be effected, except by an
instrument in writing adopted, in the case of an amendment, by each party and,
in the case of a waiver, consent or discharge, by the party against whom
enforcement of such instrument is sought. Any consent by either party to, or
waiver of, a breach by the other party shall not constitute a waiver or consent
to any subsequent or different breach. If either party fails to enforce a breach
of this Agreement by the other party, such failure to enforce shall not be
considered a consent to or a waiver of that breach or of any subsequent breach
for any purpose whatsoever.
(e) Relationship Not a Company. The Manager shall serve as an
independent contractor in rendering the services set forth herein and its
employees shall not be employees of the Company. The Manager, shall take no
action, nor omit to take any action, that would lead a reasonable person to
believe that the Manager has any relationship to the Company other than that of
an agent to its principal.
(f) Notices. All notices and other communications hereunder shall be in
writing and deemed to have been duly given if: (a) mailed via first class,
registered or certified mail, return receipt requested, postage prepaid; (b)
delivered by courier or overnight courier providing written evidence of receipt
for hand delivery; or (c) transmitted via telecopy:
To Manager:
Adelphia Business Solutions Operations, Inc.
0 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxxxxx, Esq.
Telecopy: 000-000-0000
With a copy to:
Adelphia Business Solutions Operations, Inc.
0 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xx Xxxxxxx
Telecopy: 000-000-0000
To Company:
ACC Operations, Inc.
Xxx Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxx
Telecopy: 000-000-0000
With a copy to:
Adelphia Communications Corporation
0 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx, Esq.
Telecopy: 000-000-0000
Either party hereto may change its mailing address by giving notice to the other
pursuant to the provisions of this Subsection.
(g) Disclaimers. THERE ARE NO AGREEMENTS, WARRANTIES OR REPRESENTATIONS,
EXPRESS OR IMPLIED EITHER IN FACT OR BY OPERATION OF LAW, STATUTORY OR
OTHERWISE, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE OR USE, EXCEPT THOSE EXPRESSLY SET FORTH HEREIN.
(h) Entire Agreement. This Agreement constitutes the entire agreement
between the Manager and the Company with respect to the subject matter hereof
and supersedes all prior agreements and understandings between them as to such
subject matter; and there are no restrictions, agreements, arrangements, or
undertakings, oral or written, between the Manager and the Company relating to
the transactions contemplated hereby which are not fully expressed or referred
to herein.
(i) Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner adverse to
either party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the greatest extent
possible.
(j) Further Assurances. Each party agrees to execute all such further
instruments and documents and to take all such further actions as the other
party may reasonably request in order to effectuate the terms and purposes of
this Agreement.
(k) Regulatory Approval. The effectiveness of this Agreement, and the
obligations of each party herein, are expressly subject to receipt of all
regulatory approvals necessary to conduct the business of the Company as it
relates to the Network.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered as of the date first above written.
ADELPHIA BUSINESS SOLUTIONS OPERATIONS, INC.
By: /s/ Xxxxx X. Xxxxx
------------------
Name: Xxxxx X. Xxxxx
Title: President
ACC OPERATIONS, INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------
Name: Xxxxxxx X. Xxxxx
Title: Chief Financial Officer
SCHEDULE I
Municipalities
Boulder, Colorado
Colorado Springs, Colorado
Denver, Colorado
Fort Xxxxxxx, Colorado
Pueblo, Colorado
SCHEDULE II
Services
1. Scope of Services. The Manager shall provide the services, technical
assistance, personnel, and expertise for:
1.1. the management, sales and marketing, regulatory processing,
accounting, and financial reporting for the Network, as more particularly
described in 3;
1.2. the engineering, design, planning, construction, maintenance, and
operation of the Network, as more particularly described in 4;
1.3. processing orders for service, billing for services provided by
the Network and collection of receivables for the Network, as more
particularly described in 5; and
1.4. monitoring and controlling the Network, as more particularly
described in 6.
2. Types of Services Generally. The Manager shall:
2.1. design and supervise the implementation of systems, facilities
and procedures for the implementation of the services described in this
Schedule;
2.2. train the personnel responsible for providing these services;
2.3. provide continuing oversight of the operations and management of
the Network; and
2.4. provide periodic recommendations to the Company regarding the
operations and management of the Network.
3. Management Services. The Manager shall provide the following services
with respect to the management, marketing, regulatory processing, accounting
and financial reporting for the Network:
3.1. Sales & Marketing. The Manager shall provide to the Company
continuing recommendations, advice and assistance regarding sales and marketing
plans and strategy for the Network. The Manager shall provide sales and
marketing supervisory personnel and develop appropriate marketing and sales
materials and presentations. The Manager shall negotiate agreements on behalf of
the Company with the major interexchange carriers and shall use its best efforts
to maintain relations between the Company and these carriers.
3.2. Regulatory Support. The Manager shall prepare and file, or cause to
be prepared and filed, all appropriate regulatory filings, certificates, tariffs
and reports that are required by local, state and federal governmental
regulatory bodies in connection with the operation of the Network for review and
execution by the Company. The Manager shall monitor the tariff filings including
pricing of competitive services and regulatory activities of the dominant local
telephone company in the Network's service area and recommend appropriate
changes to the Company's regulatory documents, as well as make recommendations
for other action by the Company.
3.3. Management. The Manager shall assist the Company in hiring, training
and developing appropriate management and administrative personnel. The Manager
shall provide all human resources functions for these employees including
payroll and benefit administration. The Manager shall provide advice concerning
appropriate management strategies to assist the Company in achieving its
financial and strategic objectives. The Manager shall consult with and advise
the Company and its personnel with regard to the administration, supervision and
control of the day-to-day operation of the Network.
3.4. Accounting. The Manager shall develop, implement and maintain
systems and procedures for purchasing, accounting, tax application,
bookkeeping, cash management and treasury functions.
3.5. Budgets. The Manager shall prepare and, on or prior to December 1 of
each calendar year, submit to the Company for approval, operating and capital
budgets relating to the operation of the Network (the "Budgets") for the next
succeeding calendar year except that the Budgets for 2001 shall be prepared and
delivered concurrently with the execution of the Management Agreement. The
Budgets shall include adequate provision for the construction of the Network.
The Company shall review such Budgets and, after consultation with the Manager,
shall make such changes therein, consistent with the construction and operation
of the Network, as it shall deem necessary or appropriate. Notwithstanding
anything to the contrary contained elsewhere herein, the Manager shall use its
best efforts to cause the Network to be operated in accordance with the Budgets
as so approved by the Company and shall not make, or commit the Company to make,
expenditures on behalf of the Company or the Network that exceed the
expenditures established in the Budgets without the prior written consent of the
Company.
4. Engineering Support Services. The Manager shall provide the following
services with respect to the engineering, design, planning, construction,
maintenance and operation of the Network. This Network is to include but not be
limited to: generic switch updates (Retrofits), software updates BWM's, hot
slides, switch equipment upgrades, datebase translation, AIN switched date
services, STP management, switch balance, and switch loading:
4.1. Engineering and Design. The Manager shall advise and make
recommendations to the Company regarding system engineering, system design and
overall technical guidance with regard to the Network deployment, growth, RSM
rehome, power, powering redundancies, call route diversity, evaluation including
powering of the Network, selection and purchase of appropriate electronic
equipment and other supporting infrastructure for the Network. The Manager shall
maintain databases and records of all installed circuits and fiber plant.
4.2. Central Office Equipment. The Manager shall oversee the
development of systems for the Company that will facilitate the installation
of one or more central offices for the provision of Company services,
including the planning and implementation for future growth.
4.3. Customer Premises Equipment. The Manager shall oversee the
development of systems for the Company that will facilitate the installation of
customer premises equipment and coordinate the relationship between end users
and interexchange telecommunications companies to facilitate the use of the
Network, including the planning and implementation for future growth.
4.4. Network Development. The Manager shall provide recommendations and
advice to the Company concerning the overall development of the Network,
including Network operating procedures, Network expansion and rights-of-way
acquisition and systems for the continuing care and maintenance of the fiber
optic cable, telecommunications and business switch equipment and appurtenances
of the Network.
4.5. Network Personnel. The Manager shall recruit and train all
technical personnel necessary to operate and maintain the Network and ensure
that these personnel are capable of operating and maintaining the fiber
equipment and infrastructure used in the Network.
5. Service Order, Billing and Collection Support Services. The Manager
shall provide the following services with respect to processing orders for
service, billing for services provided by the Network and collection of
receivables for the Network:
5.1. Service Order System. The Manager shall develop, implement and
maintain a service ordering system and associated procedures capable of
processing service requests from both interexchange carders and end user
customers for the Network.
5.2. Billing System. The Manager shall assist in the development and
implementation of a billing system and associated procedures capable of
processing service requests from both interexchange carriers and end user
customers for the Network, which billing system and procedures shall comply with
applicable regulations, if any.
5.3. Collection System. The Manager shall develop, implement and maintain
procedures for the collection of outstanding accounts receivable, in accordance
with all applicable federal and state laws, rules and regulations, from both
interexchange carriers and end user customers for the Network. The Manager shall
perform credit checks to determine the credit worthiness of new customers.
5.4. Record Keeping. The Manager shall prepare and maintain
appropriate records associated with providing the services described above.
6. Network Monitoring Services. The Manager shall provide network
monitoring services from its NCC in Coudersport, Pennsylvania, which shall be
staffed at all times by employees of the Manager.
The Manager shall provide the following services with respect to monitoring and
controlling the Network:
6.1. Monitoring. The Manager shall provide ongoing monitoring of the
Company's central offices, buildings, switches and circuits that are
operational on the Network to ensure that the Network and its components are
functioning properly.
6.2. Maintenance. The Manager shall provide routine maintenance and
diagnostic tests to identify potential problems and areas for improvement.
6.3. Trouble Calls. The Manager shall receive, track and coordinate
trouble calls from customers, interexchange carriers and the Company's
employees.
6.4. Remote Repairs. The Manager shall correct and repair any trouble
situations that may be corrected or repaired from a remote location.
6.5. Dispatch. The Manager shall coordinate the dispatch of local
employees or contractors of the Company or the Manager to correct trouble and
maintenance situations that require local, on-site support.
6.6. New Services. The Manager shall assist in the provision of new
services in coordination with local employees of the Company.
7. Accounts. The Manager and the Company shall use good faith efforts to
agree on methods of cash management functions, including, but not limited to,
collection of revenues and disbursements for regular recurring operating
expenses of the Network, as well as extraordinary expenses.
Schedule of Similar Agreements
In accordance with Instruction 2 to Regulation SK 601(a), following is a list of
similar agreements to Exhibit 10.17:
Management Agreement between Adelphia Business Solutions Operations, Inc. and
ACC Operations, Inc. for the management of a telecommunications network in
California.
Management Agreement between Adelphia Business Solutions Operations, Inc. and
ACC Operations, Inc. for the management of a telecommunications network in
Ohio.
Management Agreement between Adelphia Business Solutions of Virginia, LLC and
ACC Operations, Inc. for the management of a telecommunications network in
California.
