Exhibit 10.9
CONSOLIDATED COMMUNICATIONS, INC.
000 XXXXX 00XX XXXXXX
XXXXXXX, XX 00000-0000
April 14, 2004
Providence Equity Partners IV Inc.
00 Xxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxxxxxx, XX 00000
Applegate & Xxxxxxxx, Inc.
Xxx Xxxxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxx, XX 00000
Xxxxxxx X. Xxxxxxx
X.X. Xxx 0000
Xxxxxxx, XX 00000
Gentlemen:
Reference is made to the Second Amended and Restated Homebase Acquisition,
LLC Limited Liability Company Agreement dated as of January 15, 2004 (the "LLC
Agreement") among Homebase Acquisition, LLC, a Delaware limited liability
company ("Homebase"), and affiliates of each of you and that certain
professional services fee letter dated December 30, 2002, between the parties
hereto (the "2002 Services Fee Letter"). This letter agreement amends and
replaces the 2002 Services Fee Letter in its entirety. Capitalized terms used
herein without definition are used with the meanings ascribed thereto in the LLC
Agreement.
This letter sets forth our agreement that, in consideration of (i) you and
your respective affiliates' unique knowledge and understanding of the RLEC
industry in general and specifically of the business of Consolidated
Communications, Inc. ("CCI") and its subsidiaries, and (ii) the consulting,
advisory and other professional services that each of you and your respective
affiliates expect to continue to provide to CCI and its direct and indirect
subsidiaries, CCI agrees to pay a professional services fee of $2,000,000 (the
"Services Fee") per calendar year in the aggregate (payable in four equal
quarterly payments of $500,000 each) to you and your respective affiliates or
designees, provided, however, that in no case shall the Services Fee be paid in
cash unless the Consolidated EBITDA (as calculated in accordance with that
certain Credit Agreement, dated as of the date hereof, by and among Homebase,
Consolidated Communications Illinois Holdings, Inc., Consolidated Communications
Texas Holdings, Inc., CCI, Consolidated Communications Acquisition Texas, Inc.,
and the financial institutions listed on Schedule 2.01 thereto, and Citicorp
North America, Inc., as administrative agent (as the same may be amended from
time to time) or corresponding term as defined in any replacement financing
facility (the "Credit Agreement") exceeds $106,000,000 per calendar year as
Xxxxxxx X. Xxxxxxx
Providence Equity Partners, Inc.
Applegate & Xxxxxxxx, Inc.
April 14, 2004
Page 2
determined by the good faith calculations of the respective officers of CCI and
Consolidated Communications Acquisition Texas, Inc. Each of you (or your
respective affiliates) shall each receive one-third of such Services Fee. To the
extent payment of the Services Fee in cash is restricted as provided above or by
the terms of the Credit Agreement or any other debt instrument of Homebase or
the Subsidiaries that has been approved by the Board, such Services Fee will be
payable in the form of additional Class A Preferred Shares (issued at the rate
of one Class A Preferred Share for each $1,000 of Services Fees not paid in
cash). In addition, your (and your respective affiliates') rights to such
Services Fees will terminate upon a public offering of equity securities of
PUBCO, CCI or any other Subsidiary.
[END OF TEXT; THE NEXT PAGE IS THE SIGNATURE PAGE]
2004 Illinois Services Fee Letter
Xxxxxxx X. Xxxxxxx
Providence Equity Partners, Inc.
Applegate & Xxxxxxxx, Inc.
April 14, 2004
Page 3
Please acknowledge your agreement to the foregoing by executing this
letter where indicated below.
Sincerely,
CONSOLIDATED COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------------
Xxxxxx X. Xxxxxx, President and Chief
Executive Officer
AGREEMENT ACKNOWLEDGED:
PROVIDENCE EQUITY PARTNERS IV, INC.
By: /s/ Xxxx X. Xxxxxx
-------------------------------
Duly Authorized Agent
APPLEGATE & XXXXXXXX, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Duly Authorized Agent
XXXXXXX X. XXXXXXX
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
2004 Illinois Services Fee Letter
Xxxxxxx X. Xxxxxxx
Providence Equity Partners, Inc.
Applegate & Xxxxxxxx, Inc.
April 14, 2004
Page 4
Homebase Acquisition, LLC hereby agrees to issue Class A Preferred Shares
in satisfaction of unpaid Services Fees as described above.
HOMEBASE ACQUISITION, LLC
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------------
Xxxxxx X. Xxxxxx, President and Chief
Executive Officer
2004 Illinois Services Fee Letter
