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EXHIBIT 10
WAIVER AND INDEMNIFICATION AGREEMENT
AGREEMENT (the "Indemnification Agreement"), dated as of December 7,
1999, among Adelphia Communications Corporation, a Delaware corporation
("Adelphia"), Century Exchange LLC, a Delaware limited liability company
("Century"), and American Cable TV Investors 5, Ltd., a Colorado limited
partnership (the "Seller"). Reference is made to the Asset Purchase Agreement,
dated as of August 12, 1998, by and between the Seller and Century
Communications Corp. (as amended and assigned to Century, the "Purchase
Agreement"). All capitalized terms used and not defined herein shall have the
same meaning as set forth in the Purchase Agreement.
WITNESSETH:
WHEREAS, Century is a wholly owned indirect subsidiary of Adelphia;
WHEREAS, it is a condition precedent to the obligations of the Seller
and Century under the Purchase Agreement, set forth in sections 8.6 and 9.5 of
the Purchase Agreement, that all Required Consents be obtained prior to the
Closing;
WHEREAS, as of the date hereof approval has not been obtained in
connection with the transfer of the franchise relating to the subscribers in and
around Moreno Valley, California (the "Moreno Franchise") from the Seller to
Century;
WHEREAS, Century and Seller have agreed to waive the condition
precedent that the approval of the transfer of the Xxxxxx Franchise be obtained
prior to the Closing, and concurrently with the execution and delivery of this
Indemnification Agreement pursuant to the Purchase Agreement, Century is
purchasing and the Seller is selling all of the Assets excluding the Xxxxxx
Franchise; and
WHEREAS, it is a condition precedent to Seller's waiver of the
condition precedent under the Purchase Agreement that all Required Consents be
obtained prior to the Closing, and to Seller's agreement to transfer the Assets
without transferring the Xxxxxx Franchise, that the Seller receive this
Indemnification Agreement from Century and Adelphia.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. WAIVER.
(a) Each of the parties hereto hereby waives the condition precedent to
Closing under sections 8.6 and 9.5 of the Asset Purchase Agreement that the
Required Consent be obtained with respect to the Xxxxxx Franchise.
(b) Each of the parties hereto acknowledge that upon receipt of
approval to
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transfer the Xxxxxx Franchise from the Seller to Century, the Seller will
transfer the Xxxxxx Franchise to Century.
(c) Century hereby waives any and all losses, liabilities, claims,
damages or expenses (including, but not limited to, reasonable attorneys' fees
and disbursements) (collectively, "Damages"), arising from or in connection with
(i) the exclusion of the Xxxxxx Franchise from the Assets being transferred by
the Seller to Century and (ii) the transfer of the Assets without the Required
Consent with respect to the Xxxxxx Franchise, and Century waives any right to
bring any claim under the indemnity in section 12 of the Purchase Agreement with
respect to the foregoing matters.
2. INDEMNIFICATION.
(a) Adelphia hereby agrees to indemnify and hold harmless the Seller
and its affiliates, and their respective general partners, limited partners,
directors, officers, employees, agents and other representatives, from and
against any Damages, arising from or in connection with (i) the transfer of the
Assets to Century without the transfer of the Xxxxxx Franchise and without the
Required Consent with respect to the Xxxxxx Franchise and (ii) any obligations
of the Seller under the Xxxxxx Franchise arising from and after the date hereof
and (iii) any Damages of the Seller arising from the operation of the Xxxxxx
Franchise from and after the date hereof, whether pursuant to the Management
Agreement between the Seller and Century or its affiliates dated the date hereof
or otherwise.
(b) Notwithstanding any other provision of this Indemnification
Agreement, Adelphia shall not be obligated to indemnify, and shall not otherwise
be liable to, the Seller for any Damages arising from the failure of the City of
Xxxxxx Valley cable television franchise authority to approve the transfer of
the Xxxxxx Franchise to Century solely as the direct result of actions taken or
the failure to take required actions by the Seller prior to the Closing other
than issues (i) identified in the Technical Audit prepared by Xxxxxxxx Xxxxxx
(and referred to in the draft Memorandum of Undertaking from the City of Moreno
Valley, California) and (ii) relating to the obligation to provide cable
connections - free of charge- to the public schools of Rancho Verde high School
and Rainbow Ridge Elementary School which are in the Val Verde Unified School
District.
(c) The Seller hereby agrees to indemnify and hold harmless Adelphia
and its affiliates, and their respective general partners, limited partners,
directors, officers, employees, agents and other representatives (the "Adelphia
Indemnified Parties") from and against any Damages arising from the failure of
the City of Xxxxxx Valley cable television franchise authority to approve the
transfer of the Xxxxxx Franchise to Century or its affiliates solely as the
direct result of actions taken or the failure to take required actions by the
Seller prior to the Closing other than issues (i) identified in the Technical
Audit prepared by Xxxxxxxx Xxxxxx (and referred to in the draft Memorandum of
Undertaking from the City of Moreno Valley, California) and (ii) relating to the
obligation to provide cable connections - free of charge- to the public schools
of Rancho Verde high School and Rainbow Ridge Elementary School which are in the
Val Verde Unified School District.
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(d) Any indemnification claim made by the Adelphia Indemnified Parties
hereunder shall be subject to the time and amount limitations set forth in
Section 11.3 and 11.4 of the Purchase Agreement.
3. PROCEDURE FOR INDEMNIFICATION. Promptly after receipt by an
indemnified party under subsections 2(a), 2(b) or 2(c) of notice of the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against an indemnifying party under such section, give
notice to the indemnifying party of the commencement thereof, but the failure so
to notify the indemnifying party shall not relieve it of any liability that it
may have to any indemnified party except to the extent the indemnifying party
demonstrates that the defense of such action is prejudiced thereby. In case any
such action shall be brought against an indemnified party and it shall give
notice to the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, to assume the defense thereof with counsel reasonably satisfactory to such
indemnified party and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
section for any fees of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party in connection with the defense
thereof, other than reasonable costs of investigation. If an indemnifying party
assumes the defense of such action, (a) no compromise or settlement thereof may
be effected by the indemnifying party without the indemnified party's consent
unless (i) there is no finding or admission of any violation of law or any
violation of the rights of any Person and no effect on any other claims that may
be made against the indemnified party and (ii) the sole relief provided is
monetary damages that are paid in full by the indemnifying party and (b) the
indemnifying party shall have no liability with respect to any compromise or
settlement thereof effected without its consent (which shall not be unreasonably
withheld). If notice is given to an indemnifying party of the commencement of
any action and it does not, within ten days after the indemnified party's notice
is given, give notice to the indemnified party of its election to assume the
defense thereof, the indemnifying party shall be bound by any determination made
in such action or any compromise or settlement thereof effected by the
indemnified party. Notwithstanding the foregoing, if an indemnified party
determines in good faith that there is a reasonable probability that an action
may adversely affect it or its Affiliates other than as a result of monetary
damages, such indemnified party may, by notice to the indemnifying party, assume
the exclusive right to defend, compromise or settle such action, but the
indemnifying party shall not be bound by any determination of an action so
defended or any compromise or settlement thereof effected without its consent
(which shall not be unreasonably withheld).
4. RIGHTS CUMULATIVE. The indemnification contained in this
Indemnification Agreement shall be in addition to, and shall not apply to, limit
or otherwise affect or detract in any way from the rights of Century and the
Seller contained in the Purchase Agreement, provided, however, that to the
extent a claim for indemnification is made by the Adelphia Indemnified Parties
pursuant to Section 2 of this Indemnification Agreement, such claim shall be
aggregated with any claims made under the Purchase Agreement for purposes of
Section 11.4 thereof.
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5. ASSIGNMENT. The indemnification contained herein shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
assigns, successors, heirs, distributees, legatees and legal representatives.
6. GOVERNING LAW. This Indemnification Agreement shall be governed by
and construed and enforced in accordance with, the laws of the state of New
York, without giving effect to the conflict of interest laws that would call for
the application of the laws of any other jurisdiction.
7. COUNTERPARTS. This Indemnification Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes
constitute an agreement, binding on both of the parties, notwithstanding that
both of the Parties hereto are not signatories to the same counterpart. All
references herein to this Indemnification Agreement are deemed to refer to all
such counterparts.
8. SEVERABILITY. In the event any term, provision, sentence or
paragraph of this Indemnification Agreement is declared by a court of competent
jurisdiction to be void, such provision, sentence or paragraph shall be deemed
severed from the remainder of the Indemnification Agreement and the balance of
the Indemnification Agreement shall remain in effect.
9. TERMINATION. This Indemnification Agreement may be terminated at any
time by both parties hereto in writing.
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IN WITNESS WHEREOF, the parties hereto have caused this Indemnification
Agreement to be executed as of the day and year first above written.
AMERICAN CABLE TV INVESTORS V, LTD.
By: IR-TCI PARTNERS V, L.P.,
its general partner
By: TCI Ventures Five, Inc.,
its general partner
By:
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Name: Xxxxxxx Xxxxxxxxxx
Title: President
ADELPHIA COMMUNICATIONS CORPORATION,
By:
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Name:
Title:
CENTURY EXCHANGE LLC
By: CENTURY SOUTHWEST CABLE TELEVISION, INC.,
its Manager
By:
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Name:
Title:
