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MANAGEMENT AGREEMENT
between
XXXXXX CELLULAR SYSTEMS, INC.
and
ACC ACQUISITION LLC
Dated as of January 31, 2000
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TABLE OF CONTENTS
Page
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SECTION 1. ENGAGEMENT.. . . . . . . . . . . . . . . . . . . . . . . . . .1
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. . . . . . . . . . . . . . . . . . . . 12
SECTION 10. DISPUTE RESOLUTION. . . . . . . . . . . . . . . . . . . . . 13
SECTION 11. INSPECTION RIGHTS; DELIVERY OF INFORMATION. . . . . . . . . 14
SECTION 12. MISCELLANEOUS.. . . . . . . . . . . . . . . . . . . . . . . 14
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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MANAGEMENT AGREEMENT
This Management Agreement (the "Agreement") is entered into as of January
31, 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 desire to execute this Agreement to specify 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 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 the limitations of
Section 3(c) below, shall include but shall not be limited to the following:
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(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;
(viii) monitoring and controlling the Business and its
Cellular Systems;
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(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 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
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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 Business (it being understood that License renewals in
the ordinary course of business shall not require Management Committee
approval);
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(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
6(e)(i)), such New Provider may do, or cause or permit to be done, for or on
behalf of the Company, without 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
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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 estimated Out-of-Pocket Expenses will not be reimbursed until Manager
provides the Company with the invoices or other supporting documentation
therefor).
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(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 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.
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(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 Affiliate Group or (II) a
Change of Control of DCC occurs and (x) a Prohibited Transferee
(or, prior to the second anniversary of the Effective Date, any
other Person) acquires control of Xxxxxx and (y)(1) either the
Company is a limited liability company and the AWS Affiliate Group
is a Qualified Affiliate 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;
(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).
(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
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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")
designated by AWS (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 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
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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 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
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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.
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.
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(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 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.
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Section 11. INSPECTION RIGHTS; DELIVERY OF INFORMATION.
(a) COMPANY'S RIGHT TO INSPECT. Manager will permit
representatives of the Company or any Qualified Affiliate 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.
(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.
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(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.
(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
15
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
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
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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/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: VP
By: Xxxxxx XX Company
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
MANAGER:
XXXXXX CELLULAR SYSTEMS, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
