EXHIBIT 10.9
AMENDED AND RESTATED
MANAGEMENT AND CONSULTING SERVICES AGREEMENT
THIS AMENDED AND RESTATED MANAGEMENT AND CONSULTING SERVICES AGREEMENT
(this "Agreement") is entered into as of November 6, 1998 between ABRY Partners,
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Inc., a Delaware corporation ("ABRY"), Avalon Cable Holdings, LLC, a Delaware
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limited liability company (the "Parent"), Avalon Cable of Michigan Holdings,
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Inc., a Delaware corporation ("Michigan Inc."), Avalon Cable of Michigan, Inc.,
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a Delaware corporation ("Avalon Cable Michigan"), Avalon Cable of New England,
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Inc. ("Avalon Cable N.E."), Avalon Cable of New England, LLC, a Delaware limited
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liability company ("Avalon Cable N.E. LLC"), and Avalon Cable LLC, a Delaware
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limited liability company (the "Company"). ABRY and the Avalon Companies are
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referred to herein collectively as the "Parties" and each individually as a
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"Party."
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The Parent, Avalon Cable N.E. LLC and ABRY entered into a Management
and Consulting Services Agreement dated May 29, 1998 (the "Prior Agreement").
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The Parties (excluding ABRY and Avalon Cable N.E. LLC) and one
additional Person entered into a Securities Purchase Agreement (the "Securities
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Purchase Agreement") dated as of the First Closing Date, pursuant to which,
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among other things, Avalon Cable N.E. contributed its 100% equity interest in
Avalon Cable N.E. LLC to the Company in exchange for an equity interest in the
Company.
To effectuate the transactions contemplated by the Securities Purchase
Agreement, the Parties wish to, and hereby, amend and restate the Prior
Agreement in its entirety as set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the
respective agreements hereinafter set forth and the mutual benefits to be
derived from this Agreement, the Parties hereby agree as follows:
1. DEFINITIONS.
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An "Affiliate" of any Person means any other Person controlling,
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controlled by or under common control with such first Person.
"Person" means an individual, a partnership, a limited liability
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company, a corporation, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or any governmental entity.
With respect to the Parent, a "Subsidiary" means any corporation,
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partnership, limited liability company, association or other business entity of
which a majority of the total voting power of shares of stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof, or a majority economic interest, is at
the time owned or controlled, directly or indirectly, by the Parent or one or
more of the other Subsidiaries of the Parent or a combination thereof.
2. ENGAGEMENT. The Company (on behalf of the Parent and its
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Subsidiaries) hereby engages ABRY as a financial and management consultant, and
ABRY hereby agrees to provide financial and management consulting services to
the Parent and its Subsidiaries, all on the terms and subject to the conditions
set forth in this Agreement.
3. SERVICES OF ABRY. ABRY hereby agrees during the term of this
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Agreement to consult with the Managers of the Parent (the "Board"), the boards
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of directors (or similar governing bodies) of the Parent's Subsidiaries, and
management of the Parent and its Subsidiaries, in such manner and on such
business and financial matters as the Board may reasonably request from time to
time, including but not limited to corporate strategy, budgeting of future
corporate investments, acquisition and divestiture strategies, and debt and
equity financing.
4. PERSONNEL. ABRY will provide and devote to the performance of
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this Agreement those officers, employees and agents of ABRY which ABRY deems
appropriate for the furnishing of the services described in this Agreement.
5. MANAGEMENT FEES. From and after the date of this Agreement, the
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Company will pay to ABRY a management fee (pro-rated, for partial calendar
years) in installments, at the rate of (a) $50,000 per annum, if the original
cost of all securities of the Company held by ABRY and its Affiliates is less
than $10,000,000, (b) $100,000 per annum, if the original cost of all securities
of the Company held by ABRY and its Affiliates equals or exceeds $10,000,000 and
is less than $15,000,000, (c) $150,000 per annum, if the original cost of all
securities of the Company held by ABRY and its Affiliates equals or exceeds
$15,000,000 and is less than $25,000,000, or (d) $200,000 per annum, if the
original cost of all securities of the Company held by ABRY and its Affiliates
equals or exceeds $25,000,000; provided that for any calendar year (or partial
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calendar year, as the case may be) the management fee for such period shall be
calculated pro-rata, based on the number of days during such period that the
original cost of ABRY's and its Affiliates' aggregate holdings of the Company's
securities was within each of the four fee classifications specified above
(taking into account any additional purchases by ABRY or its Affiliates of
securities of the Company during such period but ignoring any sales of such
securities by ABRY or its Affiliates during such period); provided further that,
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each calendar year beginning with calendar year 1999, the Company shall pay to
ABRY the applicable fee as specified above multiplied by the Multiplier (as
defined below) for such calendar year. The "Multiplier" for each calendar year
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equals 1.05/X /where X equals (A) the number of such calendar year, minus (B)
1998 (i.e., X for calendar year 2000 equals 2000-1998 or 2, therefore the
Multiplier for calendar year 2000 equals 1.05/2/ or 1.1025). The management fee
described in this Section 5 will be payable quarterly, in arrears, on each March
31, June 30, September 30 and December 31.
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6. EXPENSES. In addition to the management fees described in
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Section 5, the Company will reimburse ABRY for reasonable travel expenses and
other out-of-pocket costs and expenses incurred by ABRY or any director,
officer, employee or other agent or representative of ABRY in connection with
the rendering of services under this Agreement (without duplication of any
reimbursement of expenses incurred by any representative of an Affiliate of ABRY
in such person's capacity as a manager of the Parent or otherwise), which
reimbursement shall be payable quarterly, in arrears.
7. EFFECT OF TERMINATION. Either ABRY or the Company (with the
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approval of the Board) may terminate this Agreement by prior written notice to
the other. No termination of this Agreement, whether pursuant to this Section 7
or otherwise, will affect the Company's duty to pay any management fee accrued,
or to reimburse any cost or expense incurred, prior to the effective date of
that termination.
8. LIABILITY. Neither ABRY nor any of its Affiliates, stockholders,
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officers, employees or agents will be liable to the Parent or its Subsidiaries
or Affiliates for any loss, liability, damage, cost or expense (including
reasonable attorneys' fees) (in the aggregate, "Losses") arising out of or in
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connection with the performance of services contemplated by this Agreement,
unless such Losses are a result of the gross negligence or willful misconduct of
such Person. The Company agrees to indemnify and hold harmless ABRY, its
stockholders, Affiliates, officers, agents and employees against and from any
and all Losses arising from ABRY's performance under this Agreement, except as a
result of the gross negligence or willful misconduct of the Person in question.
9. INDEPENDENT CONTRACTOR STATUS. ABRY and the Company agree that
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ABRY will perform services under this Agreement as an independent contractor,
retaining control over and responsibility for its own operations and personnel.
Neither ABRY nor its officers, employees or agents will be considered employees
or agents of the Parent or any of its Subsidiaries as a result of this Agreement
nor will any of them have authority to contract in the name of or bind the
Company by reason of this Agreement, except as the Company may expressly agree
in writing.
10. AMENDMENT AND WAIVER. No modification, amendment or waiver of
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any provision of this Agreement will be effective unless approved in writing by
the Company and ABRY. The failure of the Company or ABRY to enforce any of the
provisions of this Agreement will in no way be construed as a waiver of such
provisions and will not affect the right of such party thereafter to enforce
each and every provision of this Agreement in accordance with its terms.
11. NOTICES. Any notice provided for in this Agreement will be in
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writing and will be either personally delivered, or mailed by first class mail,
return receipt requested, or sent by reputable overnight courier, in each case
with delivery charges or postage prepaid, to the recipient at the address below
indicated:
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Notices to ABRY:
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ABRY Partners, Inc.
00 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxx Xxxxxxxx
Notices to the Company:
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Avalon Cable LLC
000 Xxxx 00xx Xxxxxx, Xxxxxxxxx X
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxx, President
with a copy (which will not constitute notice to the Company) to:
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Xxxx Marks & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxx
and
Xxxxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxx
or to such other address or to the attention of such other Person as the
recipient party will have specified by prior written notice to the sending
party. Any notice under this Agreement will be deemed to have been given when
so delivered or mailed.
12. SEVERABILITY. Whenever possible, each provision of this
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Agreement will be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability will
not affect the validity, legality or enforceability of any other provision of
this Agreement in such jurisdiction or affect the validity, legality or
enforceability of any provision in any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained in this
Agreement.
13. ENTIRE AGREEMENT. This Agreement embodies the complete agreement
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and understanding among the parties to this Agreement with respect to the
subject matter of this Agreement and supersedes and preempts any prior
understandings, agreements or representations
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by or among the parties, written or oral, which may have related to the subject
matter of this Agreement in any way.
14. SUCCESSORS AND ASSIGNS. This Agreement will bind and inure to
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the benefit of and be enforceable by the Company and ABRY and their respective
assigns; provided that none of the Company or ABRY may assign its rights or
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delegate its duties under this Agreement, without the prior written consent of
each of the others.
15. COUNTERPARTS. This Agreement may be executed simultaneously in
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two or more counterparts, any one of which need not contain the signatures of
more than one party, but all such counterparts taken together will constitute
one and the same Agreement.
16. DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
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are inserted for convenience only and do not constitute a substantive part of
this Agreement.
17. GOVERNING LAW. ALL ISSUES AND QUESTIONS CONCERNING THE
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CONSTRUCTION, VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS AGREEMENT WILL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR
CONFLICT PROVISION OR RULE (WHETHER OF THE COMMONWEALTH OF MASSACHUSETTS OR OF
ANY OTHER JURISDICTION) THAT WOULD CAUSE THE LAWS OF ANY JURISDICTION OTHER THAN
THE COMMONWEALTH OF MASSACHUSETTS TO BE APPLIED. IN FURTHERANCE OF THE
FOREGOING, THE INTERNAL LAW OF THE COMMONWEALTH OF MASSACHUSETTS WILL CONTROL
THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT, EVEN IF UNDER THAT
JURISDICTION'S CHOICE OF LAW OR CONFLICT OF LAW ANALYSIS, THE SUBSTANTIVE LAW OF
SOME OTHER JURISDICTION WOULD ORDINARILY APPLY.
18. WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT HEREBY
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WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY
LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF
THIS AGREEMENT OR ANY ANCILLARY AGREEMENT OR THE VALIDITY, PROTECTION,
INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF.
19. NO STRICT CONSTRUCTION. The parties to this Agreement have
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participated jointly in the negotiation and drafting of this Agreement. In the
event an ambiguity or question of intent or interpretation arises, this
Agreement will be construed as if drafted jointly by the parties, and no
presumption or burden of proof will arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this Agreement.
* * * *
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IN WITNESS WHEREOF, the parties hereto have executed this Management
and Consulting Services Agreement as of the day and year first above written.
ABRY PARTNERS, INC.
By:___________________________
Name:
Its:
AVALON CABLE HOLDINGS, LLC
By:____________________________
Name:
Its:
AVALON CABLE OF NEW ENGLAND INC.
By:____________________________
Name:
Its:
AVALON CABLE OF MICHIGAN HOLDINGS INC.
By:____________________________
Name:
Its:
AVALON CABLE OF MICHIGAN INC.
By:____________________________
Name:
Its:
AVALON CABLE LLC
By:____________________________
Name:
Its:
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AVALON CABLE OF NEW ENGLAND, LLC
By:_________________________________
Name:
Its:
The undersigned, being the parent company of the "Company" referred to
in this Agreement, hereby unconditionally guarantees the payment and performance
of the Company's obligations under this Agreement.
AVALON CABLE HOLDINGS, LLC
By:_________________________________
Name:
Title:
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