EXHIBIT 10.9
MANAGEMENT AGREEMENT
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THIS MANAGEMENT AGREEMENT (this "Agreement") is made as of this 17th day
of June, 1997 by and among RCN Operating Services, Inc., a New Jersey
corporation ("RCN Operating"), BecoCom, Inc., a Massachusetts corporation
("BecoCom"), and RCN-BecoCom, LLC, a Massachusetts limited liability company
(the "Company").
WHEREAS, RCN Telecom Services of Massachusetts, Inc., a Massachusetts
corporation ("RCN-Sub"), and BecoCom have entered into that certain Amended
and Restated Operating Agreement of the Company of even date herewith (the
"Operating Agreement"), setting forth the terms and conditions that will
govern the operation of the Company; and
WHEREAS, Boston Edison Company, a Massachusetts corporation, and C-Tec
Corporation, a Delaware corporation, have each executed instruments of
adherence with respect to certain provisions hereof; and
WHEREAS, the Company desires to retain RCN Operating to perform certain
management services for the Company, upon the terms and subject to the
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. Retention. The Company hereby retains RCN Operating, and RCN
Operating hereby agrees, to perform management services for the Company, upon
the terms and subject to the conditions set forth in this Agreement. RCN
Operating shall, at all times, use its best efforts in performing its
obligations under this Agreement.
2. Term. (a) The term of this Agreement (the "Term") shall commence
on the date hereof and unless extended or sooner terminated in accordance with
this Section 2 or Section 11 hereof, continue until December 31, 2001.
(b) The Term shall automatically be extended for successive
three year periods unless, no later than 90 days prior to the end of the
initial five-year Term or any three-year extension thereof, BecoCom, on behalf
of the Company, gives written notice of its objection (the "Objection Notice")
to RCN Operating's continued service as manager (the "Manager"). Such
Objection Notice shall include a proposal for a new manager of the Company's
business (the "New Manager") and a description of the terms and conditions
under which such New Manager would be retained.
(c) Upon RCN Operating's receipt of the Objection Notice, RCN
Operating shall have 30 days to either (i) accept the New Manager proposed by
BecoCom, (ii) propose its own New Manager by written notice to BecoCom, which
shall include a description of the terms and conditions under which such New
Manager would be retained, or (iii) insist on remaining as Manager. If RCN
Operating elects to take either of the actions set forth in clauses (ii) or
(iii) above, RCN Operating and BecoCom shall have 30 days to resolve the
dispute. If RCN Operating and BecoCom cannot resolve the dispute within such
30 days, the party which, together with its respective Affiliates (as defined
in the Operating Agreement), has the lower Investment Percentage (as defined
in the Operating Agreement) (the "Minority Member") shall have the right to
sell to the party with the higher Investment Percentage (the "Majority
Member"), and the Majority Member shall have the obligation to purchase, the
Minority Member's membership interest ("Interest") in the Company at a price
to be determined as follows (provided that RCN Operating and its Affiliates
shall not have such right to sell if they become a Minority Member because of
a failure to satisfy an obligation to make capital contributions in accordance
with the Operating Agreement):
(i) Selection of Appraisers. Each of RCN-Sub and BecoCom
shall designate by written notice to the Company and
each other a firm of recognized national standing
familiar with appraisal techniques applicable to
assets of the type being evaluated to serve as an
appraiser (an "Appraiser") pursuant to this Section 2
(the firms designated by RCN-Sub and BecoCom being
referred to herein as "RCN-Sub Appraiser" and the
"BecoCom Appraiser," respectively) within five
business days after the failure to reach agreement in
accordance with the terms of this paragraph (c). In
the event that either Appraiser is not designated
within the foregoing time period, the other Appraiser
will serve as the only Appraiser, and its appraisal
will be binding on both RCN-Sub and BecoCom for
purposes of this paragraph (c).
(ii) Evaluation Procedures. Each Appraiser shall be
directed to determine the fair market value (the "Fair
Market Value") of the Minority Member's Interest.
Each Appraiser will also be directed to deliver a
certificate (an "Appraiser's Certificate") setting
forth such Appraiser's valuation of the Minority
Member's Interest to both RCN-Sub and BecoCom on or
before the 30th day after their respective designation
(the "Certificate Date"), upon the conclusion of its
evaluation, and each Appraiser's Certificate once
delivered may not be retracted or modified in any
respect. Each Appraiser will keep confidential all
information disclosed by the Company in the course of
conducting its evaluation, and, to that end, will
execute such customary documentation as the Company
may reasonably request with respect to such
confidentiality obligation. Each of RCN-Sub and
BecoCom will cooperate in causing the Company to
provide each Appraiser with such information within
the Company's possession that may be reasonably
requested in writing by the Appraiser for purposes of
its evaluation hereunder. Each of RCN-Sub and BecoCom
shall have full access to each Appraiser's work
papers. Each Appraiser will be directed to comply
with the provisions of this Section 2, and to that end
each party will provide to its respective Appraiser
a complete and correct copy of this Section 2 (and the
definitions of capitalized terms used in this Section
2 that are defined elsewhere in this Agreement).
(iii) Fair Market Value Determination. The Fair Market
Value of the Minority Member's Interest shall be
determined on the basis of the Appraisers'
Certificates in accordance with the provisions of this
subparagraph (iii), provided, that there shall be no
"controlling interest premium" if the Majority
Member's Interest has a Sharing Ratio of less than 66
2/3% nor any "minority interest discount" if the
Minority Member's Interest has a Sharing Ratio of
greater than 33 1/3%. The higher of the values set
forth on the Appraisers' Certificates is hereinafter
referred to as the "Higher Value," and the lower of
such values is hereinafter referred to as the "Lower
Value." If the Higher Value is not more than 110% of
the Lower Value, the Fair Market Value of the Minority
Member's Interest will be the arithmetic average of the
Higher Value and the Lower Value. If the Higher Value
is more than 110% of the Lower Value, a third
appraiser shall be selected in accordance with the
provisions of subparagraph (iv) below, and the Fair
Market Value of the Minority Member's Interest will be
determined in accordance with the provisions of
subparagraph (v) below.
(iv) Selection of and Procedures for Third Appraiser. If
the Higher Value is more than 110% of the Lower Value,
within seven days thereafter the RCN-Sub Appraiser and
the BecoCom Appraiser shall agree upon and jointly
designate a third Appraiser (the "Third Appraiser").
If the RCN-Sub Appraiser and the BecoCom Appraiser
cannot agree upon a Third Appraiser within seven days,
the Third Appraiser shall be chosen by the American
Arbitration Association in Boston, Massachusetts. The
RCN-Sub Appraiser and BecoCom Appraiser shall direct
the Third Appraiser to determine the Fair Market Value
of the Minority Member's Interest (the "Third Value")
in accordance with the provisions of subparagraph (ii)
above, and to deliver to both RCN-Sub and BecoCom an
Appraiser's Certificate on or before the 30th day
after the designation of such Appraiser hereunder. The
Third Appraiser will be directed to comply with the
provisions of this Section 2, and to that end of the
parties will provide to the Third Appraiser a complete
and correct copy of this Section 2 (and the
definitions of capitalized terms used in this Section
2 that are defined elsewhere in this Agreement).
(v) Alternative Determination of Fair Market Value. Upon
the delivery of the Appraiser's Certificate of the
Third Appraiser, the Fair Market Value of the Minority
Member's Interest will be determined as provided in
this subparagraph (v). The Fair Market Value of the
Minority Member's Interest will be (w) the Lower
Value, if the Third Value is less than the Lower
Value, (x) the Higher Value, if the Third Value is
greater than the Higher Value, or (y) the arithmetic
average of the Third Value and either the Higher Value
or the Lower Value (whichever is closer to the Third
Value) if the Third Value falls within the range
between (and including) the Lower Value and the Higher
Value.
(vi) Costs. Each of RCN-Sub and BecoCom will bear the cost
of the Appraiser designated by it or on its behalf.
If the Higher Value is not more than 115% of the Lower
Value, or if the Higher Value and the Lower Value are
equally close to the Third Value, each of RCN-Sub and
BecoCom shall bear 50% of the cost of the Third
Appraiser, if any; otherwise, the party whose
Appraiser's determination of Fair Market Value of the
Minority Member's Interest is further away from the
Third Value shall bear the entire costs of the Third
Appraiser. Each of RCN-Sub and BecoCom agree to pay
when due the fees and expenses of the Appraisers in
accordance with the foregoing provisions.
(vii) Conclusive Determination. To the fullest extent
provided by law, the determination of the Fair Market
Value of the Minority Member's Interest made pursuant
to this Section 2 shall be final and binding on the
Company, RCN-Sub and BecoCom, and such determination
shall not be appealable to or reviewable by any court
or arbitrator.
(d) RCN Operating shall continue to manage the Company, on the
terms set forth herein, until such time as BecoCom, on behalf of the Company,
furnishes an Objection Notice to RCN Operating, pursuant to this Section 2,
and any dispute in connection therewith is resolved.
(e) In the event that RCN-Sub and its Affiliates which own an
Interest in the Company sell, assign, transfer or otherwise dispose of such
Interest (a "Sale") other than to a Wholly-Owned Affiliate (as defined in the
Operating Agreement) prior to the expiration of the Term, the Term shall
terminate upon the effective date of such Sale (the "Effective Date"), unless
BecoCom elects, on behalf of the Company, to extend the Term, in which case
the Term shall continue for an additional two years after the Effective Date.
3. Services.
(a) Scope of Services. Subject to the terms and conditions of
this Agreement and the Operating Agreement including, without limitation,
Sections 7.1, 7.8 and 7.10 thereof, RCN Operating shall, on a timely and
efficient basis, manage, and shall have sole power to manage, all aspects of
the Company's day to day operations consistent with the provisions of the
Operating Agreement. RCN Operating shall have the power and authority to do
those things necessary or, in RCN Operating's judgment, appropriate to
conduct, operate and manage the business of the Company, including, but not
limited to, the power and authority to:
(i) direct, endorse and deposit all checks and other
funds, collect revenues, and take such other actions
(including the establishment of the Company bank
accounts with signatories designated by RCN Operating)
regarding the collection and handling of checks and
other funds owed, owned or held by or on behalf of the
Company;
(ii) produce checks and pay all obligations of the Company
(by check or otherwise), including without limitation,
normal operating expenses, extraordinary expenses,
required interest and principal payments on debt, and
obligations owed to RCN Operating hereunder;
(iii) negotiate or renegotiate and execute business
contracts for the conduct of the Company's business
operations and construction and maintenance activities
connected therewith except for this Agreement and the
other Basic Agreements (as defined in the Operating
Agreement);
(iv) subject to the last sentence of this Subsection 3(a),
resolve contractual and other disputes which may arise
in the ordinary course of the Company's business,
except for any dispute relating to the Basic
Agreements;
(v) retain attorneys, engineers, consultants and other
professionals;
(vi) establish and maintain books and records to enable
financial statements to be prepared, as and when
required, in accordance with generally accepted
accounting principles;
(vii) under the direction of the Tax Matters Partner (as
defined in the Operating Agreement) prepare, or cause
to be prepared, and file all periodical and other
required reports of governmental and regulatory
agencies, including tax returns, and perform all
related administrative functions;
(viii) perform all aspects of managing the daily operation
of the Company's business, including, without
limitation, engaging, instructing and supervising all
personnel necessary in the judgment of RCN Operating,
and establishing and maintaining all records relative
to the operation thereof;
(ix) select and price all services provided or to be
provided to customers of the Company;
(x) oversee all advertising, marketing and sales and
public relations programs, engage and appoint
advertising, marketing and public relations agencies
and consultants;
(xi) execute all instruments of any kind or character
which, in RCN Operating's discretion, shall be deemed
necessary or appropriate in connection with the
conduct, operation and management of the Company's
business, including the procurement of insurance of
such types and in such amounts as RCN Operating shall
deem appropriate;
(xii) maintain continuing contact with federal, state and
local governmental officials regarding any rights and
licenses of the Company which require periodic review
and renegotiation; and
(xiii) perform any and all other acts as may reasonably be
necessary or appropriate to carry out the duties and
responsibilities of RCN Operating contemplated
hereunder, whether or not specifically enumerated
herein.
Notwithstanding anything to the contrary in this Subsection 3(a), RCN
Operating's powers and authority shall not extend to any company action which,
pursuant to applicable law or the Operating Agreement, requires the approval
or authorization of the Company's Members (as defined in the Operating
Agreement), including, without limitation, any "Fundamental Business Actions"
delineated in Section 7.8 of the Operating Agreement.
(b) Access. RCN Operating and BecoCom shall have full and
unrestricted access to all books and records of the Company and its
subsidiaries, if any, including without limitation:
(i) All contracts, agreements, governmental and regulatory
filings;
(ii) All accounting documentation including financial
statements, books and records, audit reports and other
documents;
(iii) All tax returns, both federal and state, and related
schedules;
(iv) All debt agreements or instruments, including pledge
and security agreements and related documents;
(v) All customer lists, billing records and histories,
accounts receivable records and other reports used in
connection with the Company's business;
(vi) All minute books;
(vii) All personnel records;
(viii) All files relative to both pending and threatened
litigation proceedings, including management's
assessment of liability;
(ix) All franchise documents and other governmental
authorizations relative to the Company's business;
(x) A complete list of all real property owned or leased
and a detailed schedule of fixed assets; and
(xi) Any other contracts, documents, statements, returns,
lists, books, files or documentation deemed necessary
by RCN Operating in order to fulfill its obligations
under this Agreement.
(c) RCN Operating Personnel. RCN Operating, at its option, may
furnish the services of any RCN Operating personnel or Affiliates as RCN
Operating may from time to time deem necessary or appropriate to perform its
obligations hereunder and such personnel or Affiliates shall have the duties
assigned to them by RCN Operating.
(d) Employees of RCN Operating; No Benefits. The parties
acknowledge and agree that: (i) by furnishing the services of RCN Operating
personnel to the Company, RCN Operating is functioning as an independent
contractor to the Company; (ii) the personnel provided by RCN Operating shall
remain employees of RCN Operating, and RCN Operating retains the right
(subject to the terms hereof) to direct and control the performance of all RCN
Operating employees; (iii) RCN Operating is solely responsible for the payment
of salary, employee benefits and all other compensation due to RCN Operating
personnel rendering services to the Company, and for all applicable federal,
state and local tax withholding with respect to compensation and benefits
payable to them under this Agreement or otherwise; and (iv) the compensation
to RCN Operating set forth in Section 4 shall be exclusive and RCN Operating
personnel shall not participate in or be eligible to participate in any
compensation or benefit plan or perquisite of the Company.
(e) Notwithstanding anything to the contrary, if BecoCom
believes that it is capable of providing to the Company certain support and
administrative services in a more efficient and economical manner than RCN
Operating or any third party provider chosen by RCN Operating, then RCN
Operating and BecoCom shall consider in good faith the use of BecoCom or its
Affiliates as a provider of such services.
(f) Any contract between RCN Operating and any of its Affiliates
for the provision of services to the Company shall be on terms no less
favorable to the Company than could be obtained from an unaffiliated third
party.
4. Fees. Fees, including incentive compensation, for RCN Operating's
services hereunder shall be determined as part of the annual budgeting process
for the Company.
(a) From the date hereof until December 31, 1998, RCN Operating
shall be reimbursed by the Company only for all of its reasonable direct and
indirect costs allocable in good faith to the Company in connection with its
provision of management services hereunder provided, however, that RCN
Operating and its Affiliates shall use their best efforts to minimize such
indirect allocable costs; the Company and BecoCom shall have reasonable access
to the books and records of RCN Operating to verify such costs.
(b) Not later than October 1, 1998, RCN Operating and the
Company will enter into discussions in order to reach an agreement on
performance-based incentive compensation to be effective starting January 1,
1999 through the end of the Term and to be paid to RCN Operating as earned in
addition to the reimbursement of RCN Operating's reasonable direct and
indirect costs. Such performance-based incentive compensation shall be based
on such factors as number of subscribers, operating cash flow, and other or
different factors as the parties shall agree.
The amounts payable pursuant to this Section 4 shall constitute the exclusive
compensation payable to RCN Operating for its services provided under this
Agreement and for the services provided by the RCN Operating personnel
hereunder, and no other compensation or consideration shall be payable to RCN
Operating or any other individual provided by RCN Operating in connection with
the services provided hereunder, except as otherwise expressly provided in
this Agreement.
5. Expense Reimbursement. To the extent not otherwise reimbursed
pursuant to Section 4 hereof, RCN Operating shall be entitled to be reimbursed
by the Company from time to time (but not more frequently than monthly) for
reasonable out-of-pocket business expenses incurred by its employees and
others working on its behalf, including expenses in connection with bona fide
business travel on behalf of the Company, upon presentation from time to time
of an itemized written account of such expenses.
6. Representations and Warranties. Each of the parties hereto
represents and warrants to the other that, as of the date hereof:
(a) it is duly organized, validly existing and in good standing
under the laws of the jurisdiction in which it is formed;
(b) it has the power and authority to execute, deliver and
perform its obligations under this Agreement; and such execution, delivery,
performance and consummation have been duly authorized by all necessary
corporate action. This Agreement has been duly executed and delivered by it
and constitutes a valid and legally binding obligation of it, enforceable
against it in accordance with its terms except as such enforceability may be
limited by applicable bankruptcy, insolvency, moratorium, reorganization, or
other laws affecting creditors' rights generally or by the availability of
equitable remedies;
(c) the execution, delivery and performance by it of this
Agreement (i) do not contravene any provision of its organizational documents;
(ii) do not violate or conflict with any law, regulation or contractual
restriction to which it is subject; and (iii) shall not result in the creation
of, or violate or conflict with, any lien, mortgage, pledge, security interest
or any other encumbrance upon or with respect to any of its properties;
(d) no consent, order, approval or authorization or other action
by, and no notice to or filing with, any governmental authority or regulatory
body is required for the due execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby; and
(e) there is no action, suit, proceeding or investigation
pending, or, to its knowledge, threatened, against or affecting it or its
properties, assets or business, in any court or before or by any governmental
department, board, agency or instrumentality, or any arbitrator, that
materially affects or impairs its ability to enter into this Agreement, or to
consummate the transactions contemplated hereby.
7. Representation and Warranty of RCN Operating. RCN Operating
represents and warrants to the Company that it has the requisite knowledge,
experience and resources to fulfill its obligations under this Agreement.
8. Covenants of the Company. The Company hereby covenants that it
will, and will cause its officers, managers, agents and representatives to,
cooperate fully with RCN Operating in its performance of its obligations under
this Agreement and to otherwise act at all times in a manner consistent with
this Agreement.
9. Indemnification.
(a) Subject to paragraph (c) below, the Company shall indemnify
RCN Operating and all of its Affiliates and their respective officers,
directors, shareholders, employees, representatives, agents or consultants
performing services for or on behalf of the Company (collectively, the
"Indemnified Parties") who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or on behalf of RCN Operating or BecoCom) caused by, relating to, based
upon or arising out of such Indemnified Party's acceptance of or the
performance or non-performance of obligations under this Agreement against
expenses (including reasonable attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him or it in connection
with such action, suit or proceeding if he or it acted in good faith and in a
manner he or it reasonably believed to be in or not opposed to the best
interest of the Company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or its conduct was
unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the Indemnified
Party did not act in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the Company, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that his conduct was unlawful, provided, however, that such indemnification
shall not be applicable to any action, suit or proceeding in which it is
finally adjudicated that any damages awarded in, or liability incurred as a
result of the facts and circumstances underlying, such action, suit or
proceeding were directly and primarily caused by the gross negligence of the
Indemnified Party.
(b) Subject to paragraph (c) below, the Company shall indemnify
any Indemnified Party who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or on behalf
of RCN Operating or BecoCom to procure a judgment in its favor by reason of
such Indemnified Party's acceptance of or the performance or non-performance
of obligations under this Agreement against expenses (including reasonable
attorneys' fees) actually and reasonably incurred by him or it in connection
with the defense or settlement of such action or suit if he or it acted in
good faith and in a manner he or it reasonably believed to be in or not
opposed to the best interests of the Company; except that no indemnification
shall be made in respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable unless and only to the extent that the
court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper.
(c) Any indemnification under this Section 9 (unless ordered by
a court) shall be made by the Company only as authorized in the specific case
upon a determination that indemnification of the Indemnified Party is proper
in the circumstances because he has met the applicable standard of conduct set
forth in paragraph (a) above. Such determination shall be made by independent
legal counsel in a written opinion. To the extent, however, that an
Indemnified Party has been successful on the merits or otherwise in defense of
any action, suit or proceeding described above, or in defense of any claim,
issue or matter therein, he shall be indemnified against expenses (including
reasonable attorneys' fees) actually and reasonably incurred by him in
connection therewith, without the necessity of authorization in the specific
case.
(d) For purposes of any determination under this Section 9, a
person shall be deemed to have acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any criminal action or proceeding, to have had no
reasonable cause to believe his conduct was unlawful, if his action is based
on the records or books of account of the Company or another enterprise, or on
information supplied to him by the officers of the Company or another
enterprise in the course of their duties, or on the advice of legal counsel
for the Company or another enterprise or on information or records given or
reports made to the Company or another enterprise by an independent certified
public accountant or by an appraiser or other expert selected with reasonable
care by the Company or another enterprise. The term "another enterprise" as
used in this paragraph (d) shall mean any entity which such person is or was
serving at the request of the Company.
(e) Notwithstanding the foregoing, any Indemnified Party may
apply to any court of competent jurisdiction in the Commonwealth of
Massachusetts for indemnification to the extent otherwise permissible under
paragraph (a) above by reason of the fact that he has met the applicable
standard of conduct. If successful, in whole or in part, the Indemnified Party
seeking indemnification shall also be entitled to be paid the expense of
prosecuting such application.
(f) Expenses incurred by an Indemnified Party in defending or
investigating a threatened or pending action, suit or proceeding shall be paid
by the Company in advance of the final disposition thereof upon receipt of an
undertaking to repay such amount if it shall ultimately be determined that he
is not entitled to be indemnified by the Company as authorized in this Section
9.
(g) The indemnification and advancement of expenses in this
Section 9 shall not be deemed exclusive of any other rights which may apply,
it being the policy of the Company that indemnification of the persons
specified in paragraph (a) above shall be made to the fullest extent permitted
by law. The provisions of this Section 9 shall not preclude the
indemnification of any person who is not specified herein but whom the Company
has the power or obligation to indemnify under the Act, or otherwise.
(h) The indemnification and advancement of expenses provided by
this Section 9 shall, unless otherwise provided when authorized or ratified,
inure to the benefit of the heirs, executors and administrators of an
Indemnified Party.
10. Confidentiality. Each of the parties hereto will hold, and will
use its reasonable, good faith efforts to cause its respective shareholders,
partners, members, directors, officers, employees, accountants, counsel,
consultants, agents and financial or other advisors (collectively "Agents") to
hold, in confidence, all information (whether oral or written), including this
Agreement and the documents contemplated herein, concerning the transactions
contemplated by this Agreement furnished to such party by or on behalf of any
other party in connection with such transactions, unless legally compelled (by
deposition, interrogatory, request for documents, subpoena, civil
investigative demand or similar process, or by order of a court or tribunal of
competent jurisdiction, or in order to comply with applicable rules or
requirements of any stock exchange, government department or agency or other
regulatory authority, or by requirements of any securities law or regulation
or other legal requirement) to disclose any such information or documents, and
except to the extent that such information or documents can be shown to have
been (a) previously known on a nonconfidential basis by such party, (b) in the
public domain through no fault of such party or (c) acquired by such party on
a nonconfidential basis from sources not known by such party to be bound by
any obligation of confidentiality in relation thereto. Notwithstanding the
foregoing provisions of this Section 10, each party may disclose such
information to its Agents in connection with the transactions contemplated by
this Agreement so long as such Agents are informed by such party of the
confidential nature of such information and are directed by such party to
treat such information confidentially and to certain governmental agencies in
connection with the procurement of the governmental authorizations
contemplated by this Agreement. The obligation of each party to hold any such
information in confidence shall be satisfied if such party exercises the same
care with respect to such information as it would take to preserve the
confidentiality of its own similar information. If this Agreement is
terminated, each party will, and will use its reasonable, good faith efforts
to cause its respective Agents and lenders to destroy or deliver to the other
party, upon request, all documents and other materials, and all copies
thereof, obtained by such party or on its behalf from the other party hereto
in connection with this Agreement that are subject to such confidence.
11. Termination.
(a) Either party may terminate this Agreement in the event of a
Default (as hereinafter defined) by the other (unless such default is caused
by the party seeking to terminate this Agreement), provided that the
non-defaulting party so advises the defaulting party in writing of the event
of Default and the defaulting party has not cured, nor commenced the diligent
pursuit of the cure of, the Default within 60 days after written notice
thereof is received. Except as otherwise provided by this Agreement, such
termination shall be effective upon the expiration of the 60 day period
immediately following receipt of notice of Default by the defaulting party.
(b) Termination regardless of cause or nature shall be without
prejudice to any other rights or remedies of the parties and shall be without
liability for any loss or damage occasioned thereby. Termination of this
Agreement for any cause shall not release either party hereto from any
liability which at the time of termination has already accrued to the other
party hereto or which thereafter may accrue in respect of any act or omission
prior to termination, or from any obligation which is expressly stated herein
to survive termination.
(c) The term "Default" is defined to include: (i) the initiation
of bankruptcy or receivership proceedings with respect to a party (which are
not dismissed within 60 days), execution of a general assignment for the
benefit of creditors or any other transfer or assignment of a similar nature
or otherwise seeking relief under any applicable bankruptcy reorganization,
moratorium or similar debtor relief laws (it being understood that the
execution of any third-party financing agreements shall not constitute a
Default hereunder) or (ii) a material breach of any of the other terms or
conditions hereof.
12. General.
(a) Amendment. No modification or amendment of, or waiver
under, this Agreement shall be valid unless in writing and signed by each of
the parties hereto.
(b) Binding Agreement; Assignment. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors and assigns. This Agreement may be assigned by RCN Operating to
any of its Affiliates so long as RCN Operating remains bound by for the
obligations hereunder. This Agreement may not be assigned by the Company.
(c) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Massachusetts
without regard to conflicts-of-laws principles.
(d) Severability. If any term, provision, covenant or
restriction herein is held by a court of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated thereby.
(e) Notices. All notices, requests and other communications
hereunder shall be deemed to have been duly delivered, given or made to or
upon any party hereto if in writing and delivered by hand against receipt, or
by certified or registered mail, postage prepaid, return receipt requested, or
to a courier who guarantees next business day delivery or sent by telecopy
(with confirmation), to such party at its address set forth below or to such
other address as such party may at any time, or from time to time, direct by
notice given in accordance with this Section 12(e).
If to RCN Operating:
c/o RCN Telecom Services, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: General Manager
and
C-TEC Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Fax: (000) 000-0000 and (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxxxx, Esq.
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxxx X Xxxxxx, Esq.
If to BecoCom:
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Vice President
Xxxxx Xxxxxxxxx, Esq., Assistant General Counsel
with a copy to:
Xxxxx, Xxxx & X'Xxxxxxxx, P.C.
Xxx Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
If to the Company:
RCN-BecoCom, LLC
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: General Manager
The date of delivery of any such notice, request or other communication shall
be the earlier of (i) the date of actual receipt, (ii) three business days
after such notice, request or other communication is sent if sent by certified
or registered mail, (iii) if sent by courier who guarantees next business day
delivery the business day next following the day such notice, request or other
communication is actually delivered to the courier or (iv) the day actually
telecopied.
(f) Entire Agreement. This Agreement contains the entire
understanding of the parties hereto respecting the subject matter hereof and
supersedes all prior discussions and understandings.
(g) Specific Performance. The parties agree that irreparable
damage will result if this Agreement is not performed in accordance with its
terms, and the parties agree that any damages available at law for a breach of
this Agreement would not be an adequate remedy. Therefore, the provisions
hereof and the obligations of the parties hereunder shall be enforceable in a
court of equity, or other tribunal with jurisdiction, by a decree of specific
performance, and appropriate injunctive relief may be applied for and granted
in connection therewith. Such remedies and all other remedies provided for in
this Agreement shall, however, be cumulative and not exclusive and shall be in
addition to any other remedies that a party may have under this Agreement, at
law or in equity.
(h) Interpretation. In the event of any dispute concerning the
construction or interpretation of this Agreement or any ambiguity hereof,
there shall be no presumption that this Agreement or any provision hereof be
construed against the party who drafted this Agreement.
(i) Enforcement. In the event of any material breach of this
Agreement by RCN Operating, BecoCom shall have the authority, acting as agent
for the Company, to enforce this Agreement against RCN Operating.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above written.
RCN OPERATING SERVICES, INC.
By
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Name:
Title:
RCN-BECOCOM, LLC
By
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Name:
Title:
BECOCOM, INC.
By
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Name:
Title:
