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Exhibit 10.2 (d)
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (this "Agreement") is made as of the __ day
of _____, 1999, by and between Charter Communications Holding Company, LLC, a
Delaware limited liability company (the "Company"), and Charter Communications,
Inc., a Delaware corporation (the "Manager").
A. The Company desires to retain the Manager to manage and
operate the cable television systems owned by the Company and
its subsidiaries and any cable television systems subsequently
acquired by the Company and its subsidiaries (except those
cable television systems managed under a separate management
agreement between the Manager and Charter Communications
Operating, LLC) (the "Cable Systems").
B. The Manager has agreed to manage and operate the Cable
Systems, all upon the terms and conditions hereinafter set
forth.
In consideration of the mutual covenants and agreements contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
1. Retention of the Manager. The Company hereby appoints the
Manager as a manager for the Cable Systems, and the Manager hereby agrees to
serve the Company as a manager for the Cable Systems, pursuant to the terms and
conditions hereinafter set forth.
2. Authority and Duties of the Manager.
(a) The Company agrees to seek the advice of the Manager
regarding the business, properties and activities of the Cable Systems during
the term hereof, and subject to the direction, control and general supervision
of the Company, the Manager agrees to provide such advice. The Manager shall
give such advice in a businesslike, efficient, lawful and professional manner in
accordance with this Agreement.
(b) Without limiting the generality of the foregoing, the
Manager shall provide all management services with respect to the operation of
the Cable Systems, including, but not limited to the following:
(i) advice concerning the hiring, termination,
performance and training of personnel;
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(ii) review, consultation and advice concerning
personnel, operations, engineering and other management and operating policies
and procedures;
(iii) review, consultation and advice concerning
maintenance standards for plant and equipment of the Cable Systems, advice as to
the Cable Systems' normal repairs, replacements, maintenance and plant upgrades,
and provide for periodic inspections;
(iv) recommendations on all necessary action to
keep the operation of the Cable Systems in compliance, in all material respects,
with the conditions of the Company's franchises and all applicable rules,
regulations and orders of any federal, state, county or municipal authority
having jurisdiction over the Cable Systems;
(v) assistance in the negotiation, on behalf of
the Company, of operating agreements (including, but not limited to, pole
attachment agreements, office and headend leases, easements and right-of-way
agreements), contracts for the purchase, lease, license or use of properties,
equipment and rights as may be necessary or desirable in connection with the
operation or maintenance of the Cable Systems and such other agreements on
behalf of the Company as are necessary or advisable for the furnishing of
program services for the Cable Systems;
(vi) development of recommendations for, and
negotiate the acquisition and maintenance of, such insurance coverage with
respect to the Cable Systems as the Company may determine upon advice and
consultation of the Manager;
(vii) guidance on all marketing, sales promotions
and advertising for the Cable Systems;
(viii) assistance in the financial budgeting
process and the implementation of appropriate accounting, financial,
administrative and managerial controls for the Cable Systems;
(ix) preparation for use by the Company of
financial reports and maintenance of books of accounts and other records
reflecting the results of operation of each Cable System and/or subsidiary; and
(x) advice and consultation with the Company in
connection with any and all aspects of the Cable Systems and the day to day
operation thereof and consultation with the Company with respect to the
selection of attorneys, consultants and accountants.
3. Management Expenses.
(a) All expenses, costs, losses, liabilities or damages
incurred with respect to the ownership or operation of the Cable Systems,
including, without limitation, wages, salaries and other labor costs incurred in
the construction, maintenance, expansion or operation of the Cable Systems, or
personnel working on special projects or services for the Company, will be paid
by the Company and, to the extent that the Manager pays or incurs any obligation
for any such expenses, costs, losses, liabilities or damages, the Company,
subject to the limitations set forth in Section 5, will pay or reimburse the
Manager therefor, as well as for any reasonable out-of-pocket expenses incurred
by the Manager in the performance of its obligations under this Agreement.
Subject to the payment priority provisions of this Section 3, the Company agrees
to pay the Manager such costs and expenses, which shall include all the costs,
expenses, liabilities and damages incurred by the Manager in performing its
obligations hereunder and any payments that the Manager may become obligated to
pay pursuant to the Mutual Services Agreement (the "Management Expenses") set
forth above monthly in arrears, provided, that in no event shall the total
Management Expenses paid during any fiscal quarter exceed three percent (3.0%)
of the Gross Revenue (as determined in accordance with generally accepted
accounting principles) of the Company for that quarter. "Gross Revenue" will
include all revenues from the operation of the Cable Systems including, without
limitation, subscriber payments, advertising revenues and revenues from other
services provided by the Cable Systems, but not including interest income or
income from investments unrelated to the Cable Systems. Accrual of such
Management Expenses shall commence upon the Effective Date (as defined below) of
this Agreement. The Management Expenses payable pursuant to this paragraph for
any month shall be reduced by the amount of any management fees and expenses
with respect to Gross Revenue of a subsidiary of the Company and separately paid
to the Manager for such month pursuant to a separate management agreement
between the Manager and a subsidiary of the Company.
Notwithstanding the foregoing, the Management Expenses due and
payable as provided in this Section 3 shall be subordinated and junior in right
of payment to the prior payment in full in cash of all of the Senior Debt (as
defined below) and shall not be paid except to the extent allowed under the
Credit Agreement (as defined below). In the event of any bankruptcy or similar
proceeding relative to the Company (a "Reorganization"), then all of the Senior
Debt shall first be paid in full in cash before any payment of the Management
Expenses is made, and in any Reorganization any amount payable in respect of the
Management Expenses shall be paid directly to the Funding Agent referred to
below, unless all the Senior Debt has been paid in full in cash. The Manager
hereby irrevocably authorizes the Funding Agent, as attorney-in-fact for the
Manager, to vote, file or prove any claim or proof of claim in any
Reorganization in respect of the Management Expenses and to demand, ▇▇▇ for,
collect and receive any such payment. The Manager shall take any actions
requested by the Funding Agent in order to accomplish any of the foregoing. If
the Manager receives any payment hereunder in violation of the terms hereof or
in connection with any Reorganization (prior to the payment in full in cash of
the Senior Debt), the Manager shall hold such payment in trust for the benefit
of the holders of the Senior Debt and forthwith pay it over to the Funding
Agent. Amounts payable to the Manager in accordance with this Section 3 which
remain unpaid by reason of the foregoing shall be accrued as a liability of the
Company and shall be payable as soon as the conditions to payment are fulfilled.
The deferred portion of the Management Expenses will bear interest at the rate
of ten percent (10%) per annum, compounded annually, from the date otherwise due
and payable until the payment thereof.
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As used herein, (i) "Credit Agreement" means the Credit
Agreement, dated as of March 18, 1999, among Charter Communications Operating,
LLC ("Charter Operating"), certain of its affiliates, the Lenders parties
thereto and the Funding Agent, Documentation Agent, Syndication Agents and
Administrative Agents named therein, as amended, restated, supplemented or
otherwise modified from time to time, and (ii) "Senior Debt" means the principal
amount of all loans and guarantee obligations from time to time outstanding or
owing under the Credit Agreement and the other loan documents executed and
delivered by Charter Operating pursuant thereto, together with interest thereon
(including any interest subsequent to any filing for Reorganization, whether or
not such interest would constitute an allowed claim, calculated at the rate set
forth for overdue loans in the Credit Agreement) and all other obligations of
Charter Operating under the Credit Agreement and such other loan documents.
(b) Notwithstanding any termination of this Agreement
pursuant to Section 4, the Manager shall, subject to the limitations set forth
above, remain entitled (i) to receive the Management Expenses set forth in
Section 3(a) for any costs or expenses incurred prior to the date of termination
which have not been paid to the Company; and (ii) to receive payment of the
deferred Management Expenses at the time of such termination if, and to the
extent that, payment thereof is otherwise permitted under Section 3(a).
4. Effective Date. This Agreement shall become effective only
upon the closing (the "Effective Date") of the initial public offering of the
Manager as contemplated by its Registration Statement on Form S-1 filed with the
Securities and Exchange Commission. If such closing does not occur for any
reason, or has not occurred by January 1, 2000, this Agreement shall be of no
force or effect and neither the Company nor the Manager shall have any rights,
obligations or liabilities under or arising out of this Agreement.
5. Term of Agreement. The term of this Agreement shall be ten
years commencing on the Effective Date, unless sooner terminated pursuant to the
terms of this Agreement. This Agreement may be terminated as follows: (a) by the
Company immediately upon written notice to the manager for Cause (as defined
below) or (b) automatically on the consummation of the sale of all or
substantially all of the Company's assets. For purposes hereof, "Cause" shall
exist if the Manager has engaged in gross negligence or willful misconduct in
the performance of its duties hereunder which could have a material adverse
effect on the Company.
6. Liability. The Company shall bear any and all expenses,
liabilities, losses or damages resulting from the operation of the Cable
Systems, and the Manager, its partners, officers, directors and employees shall
not, under any circumstances, be held liable therefor, except that the Manager
shall be liable for any loss or damage which results from its own gross
negligence or willful misconduct. Neither the Manager nor any of its partners,
members, officers, directors and employees shall be held to have incurred any
liability to the Company, the Cable Systems or any third party by virtue of any
action not constituting gross negligence or willful misconduct taken in good
faith by it in discharge of its duties hereunder, and the Company agrees to
indemnify the manager and its shareholders, partners, directors, officers and
employees and hold the Manager and its partners, directors, officers and
employees harmless with respect of the foregoing, including, but not limited to,
reasonable attorneys' fees.
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7. Notices. All notices, demands, requests or other
communications which may be or are required to be given, served or sent by a
party pursuant to this Agreement shall be in writing and shall be deemed given
upon receipt if personally delivered (including by messenger or recognized
delivery or courier service) or on the date of receipt on the return receipt if
mailed by registered or certified mail, return receipt requested, postage
prepaid, delivered or addressed as set forth below. Rejection or other refusal
to accept or the inability to deliver because of changed address of which no
notice was given shall be deemed receipt of the notice:
(a) If to the Company:
Charter Communications Holding Company, LLC
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
(b) If to the Manager:
Charter Communications, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
8. Governing Law. This Agreement and the rights and obligations
of the parties hereunder and the persons subject hereto shall be governed by,
and construed and interpreted in accordance with, the laws of the State of New
York, without giving effect to the choice of law principles thereof.
9. Miscellaneous. This Agreement shall be binding upon and inure
to the benefit of and be enforceable by and against the parties hereto and their
respective successors and assigns. This Agreement embodies the entire agreement
and understanding among the parties hereto with respect to the subject matter
hereof and supercedes all prior agreements and understandings relating to the
subject matter hereof. The headings in this Agreement are for purposes of
reference only and shall not limit or otherwise affect the meaning hereof. This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one instrument. This
Agreement is not transferable or assignable by any of the parties hereto except
as may be expressly provided herein. This Agreement may not be amended,
supplemented or otherwise modified except in accordance with the Credit
Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written and effective as of the
Effective Date.
CHARTER COMMUNICATIONS HOLDING COMPANY, LLC
a Delaware limited liability company
By:______________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
CHARTER COMMUNICATIONS, INC.,
a Delaware corporation
By:______________________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
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