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AMENDED AND RESTATED
MANAGEMENT AGREEMENT
between
XXXXXX CELLULAR SYSTEMS, INC.
and
ACC ACQUISITION LLC
Dated as of February 25, 2000
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TABLE OF CONTENTS
Page
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Section 1. Engagement.........................................................................2
Section 2. Management Standards...............................................................2
Section 3. Services to be Provided............................................................2
Section 4. Compensation.......................................................................7
Section 5. Term and Termination...............................................................8
Section 6. Noncompetition and Confidentiality................................................11
Section 7. Force Majeure.....................................................................12
Section 8. Books and Records.................................................................12
Section 9. Regulatory Compliance.............................................................13
Section 10. Dispute Resolution................................................................14
Section 11. Inspection Rights; Delivery of Information........................................14
Section 12. Miscellaneous.....................................................................15
Exhibit 2(c) Quality Standards
Exhibit 3(c) Financial Performance Standards
Exhibit 4(b)(i) Cost Allocation Methodology
Exhibit 4(b)(ii) Per Unit Cost Comparison
Exhibit 5(e) Integration with DCC Systems
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AMENDED AND RESTATED MANAGEMENT AGREEMENT
-----------------------------------------
This Amended and Restated Management Agreement (the "Agreement") is
entered into as of February 25, 2000 by and between Xxxxxx Cellular Systems,
Inc., an Oklahoma corporation ("Manager"), and ACC Acquisition LLC, a Delaware
limited liability company (the "Company"). Capitalized terms used but not
defined in this Agreement shall have the meanings given to such terms in the
Amended and Restated Limited Liability Company Agreement of the Company, dated
as of date hereof (the "LLC Agreement").
WHEREAS, the operation of the Business, including, without
limitation, the determination of policy, the preparation and filing of any and
all applications and other filings with the FCC, the hiring, supervision and
dismissal of personnel, day-to-day system operations, and the payment of
financial obligations and operating expenses, shall be controlled by the
Company, and Manager shall assist the Company in connection therewith and any
action undertaken by Manager shall be under the Company's continuing
oversight, review, control and approval, and the Company shall retain
unfettered control of, access to, and use of the Business, including its
facilities and equipment and shall be entitled to receive all profits from the
operation of the Business;
WHEREAS, Manager is an indirect wholly owned subsidiary of Xxxxxx
Communications Corporation ("DCC"), which owns 50% of the Economic Interests
and 50% of the Voting Interests of the Company;
WHEREAS, the Company owns all of the equity interests in ACC
Acquisition Co., which as of the Effective Date (as defined below) will own
certain Cellular Systems and PCS Systems;
WHEREAS, Manager is willing to provide management services for the
Company and its Subsidiaries (including ACC Acquisition Co.) on the terms and
subject to the conditions contained in this Agreement; and
WHEREAS, the parties entered into a Management Agreement dated as of
January 31, 2000 (the "Original Agreement"), and desire to execute this
Agreement to amend and restate the terms upon which Manager will perform
services to the Company hereunder.
NOW, THEREFORE, for and in consideration of the premises, the
covenants and agreements set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are acknowledged by the
execution and delivery hereof, the parties agree, and the Original Agreement
is hereby amended and restated in its entirety, as follows:
Section 1. ENGAGEMENT. The Company hereby engages Manager to oversee,
manage and supervise the development and operation of the Business, and
Manager hereby accepts such engagement, subject to and upon the terms and
conditions hereof.
Section 2. MANAGEMENT STANDARDS.
(a) Manager shall discharge its duties hereunder in compliance
with the LLC Agreement and the Operating Agreement (collectively, the
"Operating Agreements") and all applicable law. In performing its obligations
hereunder, Manager shall act in a manner that it reasonably believes to be in
the best interests of the Company consistent with the standards set forth
herein. Nothing in this Agreement shall be construed as constituting Manager
an agent of the Company beyond the extent expressly provided in, and as
limited by, this Agreement.
(b) Manager shall devote comparable attention and services to
the Company as those devoted by Manager (or any Affiliate of DCC that manages
DCC's wireless communications systems) in its management of other wireless
communications systems or markets directly or indirectly owned or managed by
Manager, and will otherwise deal with the Company subject to the terms of this
Agreement in a manner that does not discriminate against the Company in favor
of such other markets.
(c) Manager shall use reasonable best efforts to cause the
Company's Cellular Systems to comply in each of the Company's markets with the
Quality Standards set forth on Exhibit 2(c).
Section 3. SERVICES TO BE PROVIDED.
(a) SCOPE OF SERVICES. Subject to the Company's oversight,
review and ultimate control and approval and the limitations of Section 3(c)
below, Manager shall be responsible for the supervision, design, construction
and operation of the Company and the Business in accordance with the Operating
Agreements. Among other things, Manager shall have the right to select the
persons who shall perform all design, construction, management or operational
services and may elect to use its own employees or engage independent
contractors. To this end Manager shall provide generally, on the terms and
subject to the conditions set forth herein and in a manner consistent with the
standards set forth herein and in the Operating Agreements, supervisory
services with respect to (x) all administrative, accounting, billing, credit,
collection, insurance, purchasing, clerical and such other general services as
may be necessary to the administration of the Business, (y) operational,
engineering, maintenance, construction, repair and such other technical
services as may be necessary to the construction and operation of the
Business, and (z) marketing, sales, advertising and such other promotional
services as may be necessary to the marketing of the Business. The services
for which Manager shall be responsible, subject in each case to the Operating
Agreements, the Company's oversight, review and ultimate control and approval
and to
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the limitations of Section 3(c) below, shall include but shall not be limited
to the following:
(i) the marketing of Mobile Wireless Services (and,
to the extent determined by the Management Committee, other Company
Communications Services) to be offered and provided by the Company;
(ii) the management, tax compliance, accounting and
financial reporting for the Company including, but not limited to, the
preparation and presentation of reports and reviews of the business,
financial results and condition, regulatory status, competitive
position and strategic prospects of the Company as requested by the
Management Committee;
(iii) the regulatory processing for the Company,
including without limitation the preparation and filing of all
appropriate regulatory filings, certificates, tariffs and reports that
are required by, and participation in any hearings or other
proceedings before, local, state and federal governmental regulatory
bodies;
(iv) the engineering, design, planning, construction
and installation, maintenance and repair (both emergency and routine)
and operation of, and equipment purchases for, the Company;
(v) assisting the Company in the development and
preparation of budgets, including, without limitation, preparing and
presenting, not later than 60 days before the beginning of each fiscal
year (it being understood that the annual budgets for the first three
years shall be based on, in terms of format and level of detail, the
initial three-year budget of the Company, provided, that any such
annual budget shall supersede the initial three-year budget with
respect to the year covered by such annual budget), a proposed draft
of an annual operating budget for the Company's review, evaluation and
approval setting forth in reasonable detail the anticipated capital
expenditures and other projected costs and expenses of constructing
and operating the Business during the period covered by the budget,
as well as projected revenues for that period, a business plan and
personnel requirements, and key performance standards, goals and
indicators for the Company, for the period covered by the budget, in
each case presented on a month-by-month basis to the extent
practicable, and generally describing all contracts and commitments
which Manager expects to enter into on behalf of the Company during
the period covered thereby;
(vi) services relating to sales of the products and
services offered by the Company, including without limitation
processing orders for service, customer support, billing for services
provided by the Company and collection of receivables for the Company;
(vii) management information services for the
Company;
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(viii) monitoring and controlling the Business and
its Cellular Systems;
(ix) negotiating contracts, issuing purchase orders
and otherwise entering into agreements on behalf of the Company for
the purchase, lease, license or use of such properties, services and
rights as may be necessary or desirable in the judgment of Manager
for the operation of the Company;
(x) supervising, recruiting and training all
necessary personnel to be employed by the Company, and determining
salaries, wages and benefits for the Company's employees;
(xi) administering the Company's employee benefit
programs and the Company's programs for compliance with applicable
laws governing the administration and operation of such plans and
programs;
(xii) administering the Company's risk management
programs, including negotiating the terms of property and casualty
insurance and preparing a comprehensive disaster recovery program; and
(xiii) in furtherance of the foregoing, making or
committing to make permitted expenditures (including permitted capital
expenditures) on behalf of the Company.
(b) ACCOUNTS. Subject to the foregoing, the Company shall be
responsible for payment of all costs and expenses necessary to fund the
ongoing business and operations of the Business and for the provision of all
services of Manager hereunder, which shall include, but not be limited to,
payments under Section 4, payments to independent contractors, payments to
vendors and suppliers of the Business, and interest payments to creditors who
have financed the construction or operation of the Business. To the extent
provided herein, Manager shall make such payments on the Company's behalf from
one or more accounts maintained in the name of the Company at one or more
banks acceptable to the Management Committee, into which all Company revenues
shall be deposited (the "Accounts"). All funds of the Company shall be
promptly deposited in such bank accounts. All disbursements made by the
Company as permitted under this Agreement shall be made by checks drawn on the
Accounts, and all funds on deposit in the Accounts shall at all times be the
property of the Company. Manager will have the right and authority to make
deposits to and disbursements and withdrawals from the Accounts as required in
connection with the performance of its services hereunder, PROVIDED that all
signatories on the Accounts shall be subject to the approval of the Management
Committee. The executive officers of the Manager shall be deemed to be
signatories who have been approved by the Management Committee.
(c) RESTRICTIONS ON MANAGER'S AUTHORITY. Anything to the
contrary in this Agreement notwithstanding, Manager shall not take, or cause
or permit to be taken, any action that requires the approval of the Management
Committee under Section 7.3 of
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the LLC Agreement (including, if applicable, by reference to Exhibit A to the
LLC Agreement), or do, or cause or permit to be done, any of the following
for or on behalf of the Company without the prior written consent of the
Management Committee (unless included with reasonable specificity in a budget
duly adopted by the Company):
(i) settle any claim or litigation by or against
the Company if the settlement involves a payment of $100,000 or more,
or any non-ministerial regulatory proceedings involving the Company;
(ii) (A) lend money or guarantee debts of others
(other than wholly-owned Subsidiaries of the Company) on behalf of the
Company, or assign, transfer, or pledge any debts due the Company, or
(B) release or discharge any debt due or compromise any claim of the
Company, other than trade credit and advances to employees in the
ordinary course of business;
(iii) invest in or otherwise acquire any debt or
equity securities of any other Person, enter into any binding agreement
for the acquisition of any interest in any business entity or other
Person (whether by purchase of assets, purchase of stock or other
securities, merger, loan or otherwise), or enter into any joint venture
or partnership with any other Person;
(iv) take any tax reporting position or make any
related election on behalf of the Company which is inconsistent with
the directions given by the Management Committee;
(v) assert on behalf of the Company a position with
respect to any material matter, or disagree on behalf of the Company
with a position taken with respect to any material matter by a Member
or any other Person, before the Federal Communications Commission or
any other Governmental Authority, a self-regulatory body, any industry
organization or in any other public forum;
(vi) knowingly take or fail to take any action that
violates (A) any law, rule or regulation relating to the Business, (B)
any material agreement, arrangement or understanding to which the
Company is a party, including an Operating Agreement, (C) any License
or other governmental authorization granted to the Company in
connection with its ownership and operation of the Business, or (D) any
judicial or administrative order or decree to which the Company is
subject;
(vii) sell, assign, transfer, or otherwise dispose
of, or hypothecate or xxxxx x Xxxx on any License or other material
assets belonging to the Company (other than the disposal of assets or
equipment in the ordinary course of business);
(viii) take any action amending or agreeing to amend
any License granted to the Company in connection with its ownership and
operation of the
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Business (it being understood that License renewals in the ordinary
course of business shall not require Management Committee approval);
(ix) borrow money on behalf of the Company or enter
into other forms of financing for the Business, other than any capital
lease;
(x) commingle any funds of the Company with funds
of any other entity or Person;
(xi) hire or fire the independent certified public
accountants of the Company;
(xii) pay to any employee or agent of, or consultant
or advisor to, the Company, cash compensation in excess of $150,000 in
any fiscal year;
(xiii) establish any reserves that are not set forth
on the quarterly financial reports provided to the Management
Committee;
(xiv) make any material changes or modifications to
any significant components of the Company's Cellular Systems as they
exist on the Effective Date;
(xv) enter into any contract, agreement (including
any capital lease) or other commitment or issue any purchase order,
which contract or other agreement or purchase order (A) is not in the
ordinary course of business, (B) obligates the Company to make payments
of $100,000 or more within any 12-month period or (C) could reasonably
be expected to create a material variance relative to (x) in the case
of a capital expenditure, the total budget for capital expenditures
contained in any budget approved by the Management Committee and (y) in
the case of an operating expense, the total operating expense budget
contained in any budget approved by the Management Committee, in each
case for the year-to-date period in which the expenditure is made or
incurred and taking into account all previous expenditures and
commitments in such year-to-date period; or terminate or amend in any
material respect any contract, agreement or other commitment or
purchase order, in each case if the execution and delivery or issuance
thereof requires approval pursuant to this Section 3(c); or
(xvi) enter into, or commit to enter into, any
agreement, arrangement or understanding that could reasonably be
expected to have an adverse effect on the Company's ability to comply
in any material respect with the Quality Standards set forth in Exhibit
2(c) or the financial performance standards set forth in Exhibit 3(c).
PROVIDED, that if this Agreement is terminated by the Company pursuant to
5(b)(ii)(B), and AT&T designates the New Provider (as defined in Section
5(e)(i)), such New Provider may do, or cause or permit to be done, for or on
behalf of the Company, without
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the prior written consent of the Management Committee, any of the actions set
forth in clauses (i) through (xvi) above; PROVIDED, FURTHER, that anything
herein to the contrary notwithstanding, the New Provider shall not take any
action set forth on Exhibit B to the LLC Agreement without obtaining approval
of the Management Committee in the manner specified in the LLC Agreement.
Prior to the effectiveness of any assignment to a New Provider, such Person
shall agree in writing to become bound by this Agreement.
(d) BUDGETS. Manager shall prepare or cause to be prepared
and present not later than 30 days before the beginning of each fiscal year
following the fiscal year 2000 an annual operating budget (with quarterly
forecasts) for the Company's review, evaluation and approval (each, as duly
approved by the Company, an "Operating Budget"). Each Operating Budget shall
set forth in reasonable detail the anticipated capital expenditures and other
projected costs and expenses of operating the Company's Cellular Systems
during the period covered by the budget, as well as projected revenues for
that period and the projected reportable income for such quarter and Manager
shall endeavor to assure the accuracy of its estimates. Prior approval by the
Company shall be required for any expenditure which would result in operating
expenditures exceeding any summary line item in an Operating Budget by more
than 10 percent or the total amount of expenses contemplated by an Operating
Budget by more than 10 percent.
(e) TRANSACTIONS WITH AFFILIATES. Notwithstanding anything
in this Agreement to the contrary, without the prior approval of the
Management Committee, Manager shall not (and shall cause the Company and its
Subsidiaries not to) enter into any agreement, arrangement or understanding
with Manager or any of its Affiliates or any member of the Xxxxxx Group
except in the ordinary course of the Business of the Company and on
commercially reasonable terms that are no less favorable to the Company or
its Subsidiaries than the Company or its Subsidiaries would obtain in a
comparable arm's-length transaction with an unaffiliated Person. In its
request for approval of the Management Committee, Manager shall specify that
the applicable transaction is subject to this Section 3(e).
Section 4. COMPENSATION.
(a) REIMBURSEMENT. The Company shall reimburse Manager for
all out-of-pocket expenses ("Out-of-Pocket Expenses") reasonably incurred by
Manager for goods and services provided by third parties to, for or on behalf
of the Company or incurred by Manager in the performance of its duties and
responsibilities hereunder. Manager shall provide the Company with a
statement setting forth in reasonable detail (and with copies of invoices or
other supporting documentation) the Out-of-Pocket Expenses claimed within
thirty (30) days after they are incurred, provided, that Out-of-Pocket
Expenses incurred in the last thirty (30) days of any fiscal year shall be
claimed or estimated in good faith at least two weeks prior to the end of
such fiscal year. The Company shall pay to Manager each such amount within
thirty (30) days of receipt of such statement and invoices or other
supporting documentation (it being understood that
7
estimated Out-of-Pocket Expenses will not be reimbursed until Manager
provides the Company with the invoices or other supporting documentation
therefor).
(b) COST ALLOCATIONS. To the maximum extent practicable,
Manager and its Affiliates will specifically identify costs associated with
the Business, which shall be reimbursed by the Company as Out-of-Pocket
Expenses in accordance with Section 4(a). To the extent that such specific
identification is impracticable, Manager shall charge the Company "Cost
Allocations" for those common costs which benefit the Company (including an
appropriate portion of Manager's general overhead expenses). Cost Allocations
(including without limitation the cost of services directly allocable to the
Company that are performed by employees of DCC or its Affiliates) shall be
calculated in the manner set forth in Exhibit 4(b)(i). Manager shall cause to
be furnished to the Company, at Company's expense, an accounting of any such
Cost Allocations, and the Company shall pay to Manager such amount within
thirty (30) days of receipt of such accounting. Exhibit 4(b)(ii) sets forth
by category in reasonable detail the per unit costs incurred by American
Cellular Corporation in 1999, the per unit costs incurred by Manager and its
Affiliates in 1999, and Manager's good faith estimate of the projected per
unit costs to be incurred by the Company in 2000, in operating their
respective Cellular Systems.
(c) DISPUTES, ETC. If the Company disputes the amount of
Out-of-Pocket Expenses or Cost Allocations claimed by Manager, the Company
shall notify Manager in writing before payment is due, and if the matter
cannot be resolved informally between the parties, either the Company or
Manager may request resolution of the dispute pursuant to Section 10.
Section 5. TERM AND TERMINATION.
(a) TERM. This Agreement shall commence on the Closing Date
under the Agreement and Plan of Merger dated as of October 5, 1999 among the
Company, ACC Acquisition Co. and American Cellular Corporation (the
"Effective Date") and shall terminate as provided herein or under the LLC
Agreement.
(b) TERMINATION.
(i) BY EITHER PARTY. Either party may terminate this
Agreement in the event that a Governmental Authority shall enter an
order appointing a custodian, receiver, trustee, intervenor or other
officer with similar powers with respect to the other 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
law of any jurisdiction, or ordering the dissolution, winding up or
liquidation of such party; or if a party files a petition seeking any
such order; or if any such petition shall be filed against such party
and shall not be dismissed within one hundred and twenty (120) days
thereafter; or an order shall have been issued
8
granting such party a suspension of payments under applicable law and
any such order is not dismissed within one hundred and twenty (120)
days thereafter.
(ii) BY COMPANY. The Company (acting through the
Management Committee, excluding the Representatives appointed by DCC)
may terminate this Agreement:
(A) on five (5) days' notice in the event of
a material breach of this Agreement by Manager (as determined
by the Management Committee, excluding the Representatives
appointed by DCC), which has not been cured within sixty (60)
days following notice thereof from the Company;
(B) on five (5) days' notice if (I) the DCC
Affiliate Group ceases to be a Qualified Member Group or (II)
a Change of Control of DCC occurs and (x)(1) a Prohibited
Transferee (alone or as part of a "group" as such term is used
in Sections 13(d) and 14(d) of the Exchange Act and the
regulations thereunder) or (2) prior to the second anniversary
of the Effective Date, any other Person (alone or as part of a
"group" as such term is used in Sections 13(d) and 14(d) of
the Exchange Act and the regulations thereunder) or (3) on or
after the second anniversary of the Effective Date, a Person
that is not a Prohibited Transferee (alone or as part of a
"group" as such term is used in Sections 13(d) and 14(d) of
the Exchange Act and the regulations thereunder), acquires
control of Xxxxxx and (y)(1) either the Company is a limited
liability company and the AWS Affiliate Group is a Qualified
Member Group or (2) the Company has converted to a corporation
and the AWS Affiliate Group retains at least 50% of its
initial economic interests or (III) Manager ceases to be a
wholly owned subsidiary of DCC; provided, in the case of
clause (II)(x)(3) only, that AWS Sub shall, within 60 days
after the Change of Control of DCC, have elected in its
reasonable discretion to cause the Company to (and the Company
thereupon shall) terminate this Agreement;
(C) on five (5) days' notice if the Company
(acting through the Management Committee, excluding the
Representatives appointed by DCC) has notified Manager of the
Company's failure to comply with the Quality Standards in any
material respect, and such failure has not been cured within
sixty (60) days thereafter or, if such breach is not capable
of being cured on commercially reasonable terms within such
sixty (60) day period, within one-hundred eighty (180) days of
such notice, provided that Manager is using reasonable best
efforts to cure such breach as soon as reasonably practicable;
and
(D) on five (5) days' notice if the Company
fails to comply with the financial performance standards set
forth on Exhibit 3(c).
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(iii) BY MANAGER. Manager may terminate this
Agreement on five (5) days' notice in the event of a material breach of
this Agreement by the Company (other than a payment default) which has
not been cured within sixty (60) days following notice thereof from
Manager.
(c) REMEDIES. The remedies set forth herein are 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.
(d) CONTINUING OBLIGATIONS. Notwithstanding the provisions
of Sections 6(a) and (b), no termination of this Agreement shall take effect
until the expiration of the Transition Period (as defined below). After
receipt of written notice of termination, but prior to the expiration of the
Transition Period, Manager shall continue to perform under this Agreement
unless specifically instructed (by the Management Committee, excluding the
Representatives appointed by DCC) to discontinue such performance in whole or
in part. In the event of termination, Manager and the Company shall remain
liable for their respective obligations accrued under this Agreement prior to
the expiration of the Transition Period.
(e) TRANSITION ARRANGEMENTS.
(i) GENERAL. In the event of termination of this
Agreement for any reason, Manager shall, during the Transition Period,
at the Company's expense, cooperate with the Company in order to
facilitate the transition to a new management service provider (the
"New Provider"), who shall be designated by AWS in its sole discretion
(and which may be, at the election of AWS, an Affiliate of AWS).
Manager shall at the Company's expense take all commercially reasonable
steps to assist the New Provider in assuming the management of the
Company and the operation of the Company's Cellular Systems including,
without limitation, transferring to the New Provider all historical
financial, tax, accounting, billing and other data with respect to the
Company in the possession of Manager or its Affiliates, and giving such
consents, assigning such permits and executing such instruments as may
be necessary to vest in the New Provider those rights that were used by
Manager to perform its services hereunder. Exhibit 5(e) sets forth
those items of information and other assets and properties of the
Company that Manager anticipates will be integrated in whole or in part
with the operations of Manager or its Affiliates in the course of
Manager's performance of its obligations hereunder, and that will
accordingly need to be transferred to the Company or the New Provider
in connection with any termination of this Agreement.
(ii) USE OF MANAGER MARKS. Notwithstanding anything
herein to the contrary, in the event of termination of this Agreement
by Manager other than pursuant to Section 5(b)(i) or Section 5(b)(iii),
Manager shall use reasonable efforts to make available to the Company
on commercially reasonable terms, by
10
license, sublicense or otherwise, during the Transition Period, the
right to market in those areas being served by the Company at the
commencement of the Transition Period those products and services
being marketed at the commencement of the Transition Period under
those marks owned by or licensed to Manager or its Affiliates (the
"Manager Marks") being used for such purpose at the commencement of the
Transition Period (including the "Cellular One" name and logo and, if
applicable, the "Xxxxxx" name and logo) and, during the Transition
Period and for six (6) months thereafter, neither Manager nor any of
its Affiliates shall market under any of the Manager Marks in such
areas such products and services.
(iii) "Transition Period" means the period commencing
on the effective date of termination of this Agreement and expiring on
the later of (x) the first anniversary of such date of termination and
(y) the date on which the Company, as managed by the New Provider, is
able, in the good faith determination of AWS, to provide substantially
the same level of service to its registered and roaming customers as it
did when the Company was managed by Manager.
Section 6. NONCOMPETITION AND CONFIDENTIALITY.
(a) NONCOMPETITION. During the Transition Period, neither
Manager nor any of its Affiliates shall assist or become associated with any
person or entity, whether as a principal, partner, employee, consultant or
shareholder (other than as a holder of not in excess of 5% of the outstanding
voting shares of any publicly traded company) that is actively engaged in the
business of providing Mobile Wireless Services in the Territory.
(b) CONFIDENTIALITY. Manager shall, and shall cause each of
its Affiliates, and each of its and their respective partners, members,
managers, shareholders, directors, officers, employees and agents
(collectively, "Agents") to keep secret and retain in strictest confidence
and not use for any purpose any and all Confidential Information relating to
the Company or any member of the Company and shall not disclose such
information, and shall cause its Agents not to disclose such information, to
the same extent provided in Section 8.9 of the LLC Agreement.
(c) COMPANY PROPERTY. Promptly following the termination of
this Agreement, Manager shall return to the Company all property of the
Company, and all copies thereof in its possession or under its control, and
all tangible embodiments of Confidential Information in its possession in
whatever media such Confidential Information is maintained.
(d) NON-SOLICITATION OF EMPLOYEES. During the Transition
Period and for six months thereafter, neither Manager nor any of its
Affiliates will directly or indirectly induce any employee of the Company or
any of its Affiliates, or any employee
11
of the New Provider or any of its Affiliates, to terminate employment with
such entity, and will not directly or indirectly, either individually or as
owner, agent, employee, consultant or otherwise, employ or offer employment
to any person who is or was employed by the Company or any of its Affiliates,
or by the New Provider or any of its Affiliates, unless such person shall
have ceased to be employed by such entity for a period of at least six months.
(e) INJUNCTIVE RELIEF WITH RESPECT TO COVENANTS. Manager
acknowledges and agrees that the covenants and obligations contained in this
Section 6 relate to special, unique and extraordinary matters and that a
violation of any of the terms of such covenants and obligations will cause
the Company irreparable injury for which adequate remedies are not available
at law. Therefore, Manager agrees that the Company shall be entitled to an
injunction, restraining order, or such other equitable relief as a court of
competent jurisdiction may deem necessary or appropriate to restrain Manager
and its Affiliates from committing any violation of the covenants and
obligations contained in this Section 6. These injunctive remedies are
cumulative and are in addition to any other rights and remedies the Company
may have at law or in equity.
Section 7. FORCE MAJEURE. Neither of the parties will be liable for
nonperformance or defective or late performance of any of its obligations
hereunder to the extent and for such periods of time as such nonperformance,
defective performance or late performance is due to reasons outside such
party's control, including acts of God, war (declared or undeclared), acts
(including failure to act) of any governmental authority, riots, revolutions,
fire, floods, explosions, sabotage, nuclear incidents, lightning, weather,
earthquakes, storms, sinkholes, epidemics, strikes, or delays of suppliers or
subcontractors for the same causes.
Section 8. BOOKS AND RECORDS. Manager shall maintain and oversee the
maintenance and preparation of proper and complete records and books of
account for tax and financial purposes with respect to its management of the
operation of the Business, including all such transactions and other matters
as are usually entered into records and books of account maintained by
Persons engaged in business of like character or as required by law. Manager
shall maintain and oversee the maintenance and preparation of complete
records and books of the Company for tax purposes. Books and records
maintained for financial purposes shall be maintained in accordance with
GAAP, and books and records maintained for tax purposes shall be maintained
in accordance with the Code and applicable Treasury Regulations. Within five
(5) days after the end of each month Manager shall prepare or cause to be
prepared and transmit to the Company unaudited statements, which shall
include a general ledger and a trial balance. Manager shall also provide at
the Company's request and expense any and all such additional statements or
reports as may be reasonably necessary to the Company's oversight and control
of the Business. The Company shall have control over and access, at all
reasonable times during normal business hours, to the books and records of
the Company maintained by Manager pursuant to this Section 8.
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Section 9. REGULATORY COMPLIANCE. Subject to the other provisions of
this Agreement, Manager shall cause the Company and its Subsidiaries, and
their respective Cellular Systems, to remain in compliance in all material
respects with applicable laws, rules and regulations, including rules and
regulations promulgated by the FAA and the FCC. Without limiting the
generality of the foregoing, the parties agree to comply with all applicable
FCC rules and regulations governing the Cellular Systems and the Licenses,
and specifically agree as follows:
(a) The Company (or its Subsidiaries which are the holders
of the Licenses) shall at all times maintain absolute control over, and
retain the ability to exercise the unfettered use of, the Licenses and the
licensed facilities provided thereunder, including the products and services
to be offered and the rates to be charged and the further right to terminate
service should public interest obligations under the applicable Licenses so
require.
(b) Manager shall not represent itself as the holder of a
License to provide the Company Communications Services on any of the Cellular
Systems of the Company.
(c) Each customer (if any) billed by Manager shall be
clearly advised that service is provided over facilities licensed to the
Company (or the Subsidiary which is the holder of a License).
(d) Neither Manager nor the Company (or a Subsidiary which
is a holder of a License) shall represent itself as the legal representative
of the other before the FCC. Manager and the Company (and each Subsidiary
which is the holder of a License) will cooperate with the other with respect
to FCC matters concerning the Cellular Systems.
(e) The Company (and each Subsidiary which is the holder of
a License) shall (i) in cooperation with Manager, take all actions necessary
to keep its Licenses in force and shall prepare and submit to the FCC, or any
other relevant authority, all reports, applications, renewals, filings or
other documents necessary to keep its Licenses in force and in good standing;
(ii) with all due assistance which may be necessary from Manager, respond
promptly to all FCC correspondence or inquiries and will immediately notify
Manager of the receipt thereof; and (iii) promptly report any changes of its
address to the FCC and to Manager.
(f) The Company (and each Subsidiary which is the holder of
a License) and Manager are familiar with the rules of the FCC regarding the
responsibility of the holder of a License under the Communications Act and
applicable FCC rules, regulations and policies. Nothing in this Agreement is
intended to diminish or restrict the obligations of the Company (or a
Subsidiary which is the holder of a License) as an FCC licensee and both
parties desire that this Agreement be in compliance with the rules and
regulations of the FCC. If the FCC determines that any provision of this
Agreement
13
violates any FCC rule, policy or regulation, all parties will make good faith
efforts to immediately correct the problem and bring this Agreement into
compliance, consistent with the intent of this Agreement.
Section 10. DISPUTE RESOLUTION. If a dispute arises out of or
relating to this Agreement or the transactions contemplated hereby, or the
construction, interpretation, performance, breach, termination,
enforceability or validity hereof, whether such claim is based on rights,
privileges or interests recognized by or based upon contract, tort, fraud,
misrepresentation, statute, common law or any other legal or equitable
theory, and whether such claim existed prior to or arises on or after the
Effective Date, the dispute resolution processes set forth in Section 8.11 of
the LLC Agreement shall govern the resolution of such dispute.
Section 11. INSPECTION RIGHTS; DELIVERY OF INFORMATION.
(a) COMPANY'S RIGHT TO INSPECT. Manager will permit
representatives of the Company or any Qualified Member Group, at the
Company's or such Group's cost, during normal business hours and upon not
less than five business days' advanced written request, to (i) visit and
inspect during normal business hours Manager's properties and facilities
which are utilized in connection with Manager's provision of services to the
Company pursuant to this Agreement, including without limitation access to,
and the right to make copies of, books and records of the Company located at
such properties and facilities, and (ii) discuss with Manager's officers and
employees such properties and facilities and Manager's provision of services
to the Company pursuant to this Agreement. All such information shall be held
in confidence by the Company or such Group, except for disclosures made to
the Company's or Group's advisors, lenders and investors, or as required to
be disclosed by process of law or other applicable law.
(b) NOTICE OF CERTAIN EVENTS. Promptly, and in any event
within five (5) business days after Manager has received notice or has
otherwise become aware thereof, Manager shall give the Company notice of (i)
the commencement of any material proceeding or investigation against the
Company or Manager by or before any governmental body or in any court or
before any arbitrator which would be likely to have a material adverse effect
on Manager, the Business or the Company, or on Manager's ability to perform
its obligations hereunder, and (ii) the occurrence or non-occurrence of any
event (x) which constitutes, or which with the passage of time or giving of
notice or both would constitute, a default by the Company or Manager under
this Agreement or under any other material agreement to which the Company or
Manager is a party or by which its properties may be bound, and (y) would be
likely to have a material adverse effect on Manager, the Business or the
Company, or on Manager's ability to perform its obligations hereunder, giving
in each case the details thereof and specifying the action being taken or
proposed to be taken with respect thereto. Promptly upon receipt thereof,
Manager shall deliver to the Company copies of any material notice or report
regarding any License from the grantor of such license or from any
Governmental Authority regarding the Business or the Company.
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(c) OTHER INFORMATION. From time to time and promptly upon
each request, Manager shall provide the Company with such data, certificates,
reports, statements, financial projections, documents or further information
regarding the business, equity owners, assets, liabilities, financial
position or results of operations of Manager, as may be reasonably requested
by the Company.
Section 12. MISCELLANEOUS.
(a) COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but
all of which together shall constitute one instrument.
(b) CONSTRUCTION. Each of the parties hereto acknowledge
that it has reviewed this Agreement and that the normal rule of construction
to the effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of this Agreement or any
amendments thereto. The captions used herein are for convenience of reference
only and shall not affect the interpretation or construction hereof. All
pronouns and any variations thereof shall be deemed to refer to the
masculine, feminine, neuter, singular, plural as the context may require.
Unless otherwise specified, (i) the terms "hereof," "herein," and similar
terms refer to this Agreement as a whole, (ii) references herein to Articles
or Sections refer to articles or sections of this Agreement and (iii) the
word "including" connotes the words "including without limitation unless the
context requires otherwise.
(c) BENEFIT; ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of all parties hereto and their respective
successors and permitted assigns; PROVIDED, however, that Manager shall not
assign or otherwise transfer its rights and obligations under this Agreement
(other than to another wholly owned subsidiary of DCC that has substantially
the same ability to perform its obligations hereunder as the original
Manager) without the prior written consent of the Company (acting through the
Management Committee excluding the Representatives appointed by DCC). The
parties agree that, upon any termination of this Agreement by the Company
pursuant to Section 5(b)(i) or Section 5(b)(ii), the rights and (to the
extent provided herein) obligations of Manager shall be deemed to have been
assigned to the New Provider; PROVIDED, that no such termination shall
relieve Manager of any liability which at the time of termination had already
accrued to Manager or which thereafter may accrue in respect of any act or
omission of Manager or its Affiliates prior to such termination.
(d) COMPLETE AGREEMENT. This document, the exhibits
attached hereto and each of the documents referred to herein, embody the
complete agreement and understanding among the parties relating to the
subject matter hereof and supersede and preempt any prior understandings
(written or oral) relating to such subject matter, including the letter
agreement and term sheet attached thereto dated October 5, 1999 among AT&T
Wireless Services, Inc., DCC and Xxxxxx XX Limited Partnership.
15
(e) AMENDMENT. This Agreement may not be amended except by
a writing signed by each of the parties.
(f) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws, and not the laws of conflict,
of the State of New York.
(g) SEVERABILITY. If any provision of this Agreement or the
application thereof to any person or circumstance shall for any reason or to
any extent be invalid or unenforceable, the remainder of this Agreement and
the application of such provision to other persons or circumstances shall not
be affected thereby, but, rather, shall be enforced to the extent permitted
by law, so long as the economic and legal substance of this Agreement and the
actions contemplated hereby is not affected in any manner adverse to either
party.
(h) FURTHER ASSURANCES. The parties agree that they will
take all such further actions and execute and deliver all such further
instruments and documents as may be required in order to effectuate the
agreements set forth in this Agreement.
(i) WAIVER. No failure or delay on the part of the parties
or any of them in exercising any right, power or privilege hereunder, nor any
course of dealing among the parties or any of them shall operate as a waiver
of any such right, power or privilege nor shall any single or partial
exercise of any such right, power or privilege preclude the simultaneous or
later exercise of any other right, power or privilege. The rights and
remedies herein expressly provided are cumulative and are not exclusive of
any rights or remedies which the parties or any of them would otherwise have.
(j) NOTICES. All notices or other communications hereunder
shall be in writing and shall be deemed to have been duly given or made (i)
upon delivery if delivered personally (by courier service or otherwise) or
(ii) upon confirmation of dispatch if sent by facsimile transmission (which
confirmation shall be sufficient if shown on the journal produced by the
facsimile machine used for such transmission), and all legal process with
regard hereto shall be validly served when served in accordance with
applicable law, in each case to the applicable addresses set forth below (or
such other address as the recipient may specify in accordance with this
Section):
If to Manager:
Xxxxxx Cellular Systems, Inc.
c/x Xxxxxx Communications Corporation
00000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
16
If to the Company:
ACC Acquisition LLC
c/x Xxxxxx Communications Corporation
00000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
with copies to:
Xxxxxx Communications Corporation
00000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
and
AT&T Wireless Services, Inc.
0000 000xx Xxxxxx, XX
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx-Key
Facsimile: (000) 000-0000
* * *
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have set their hands effective as of
the date first written above.
COMPANY:
ACC ACQUISITION LLC
By: AT&T Wireless Services JV Co.
By: /s/ Xxx Xxxxx
-----------------------------------
Name: Xxx Xxxxx
Title: Vice President
By: Xxxxxx XX Company
By: /s/ Xxxxx X. Xxxxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title: V.P. and Chief Financial Officer
MANAGER:
XXXXXX CELLULAR SYSTEMS, INC.
By: /s/ Xxxxx X. Xxxxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title: V.P. and Chief Financial Officer