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MANAGEMENT SERVICES AGREEMENT

Management Facility Services Agreement

MANAGEMENT SERVICES AGREEMENT | Document Parties: ATLANTIC BROADBAND FINANCE, LLC | Grande Communications Networks, LLC | Grande Manager LLC | Grande Parent LLC | Grande, Grande Communications Holdings, Inc, ABRY Partners, LLC, Grande Investment LP You are currently viewing:
This Management Facility Services Agreement involves

ATLANTIC BROADBAND FINANCE, LLC | Grande Communications Networks, LLC | Grande Manager LLC | Grande Parent LLC | Grande, Grande Communications Holdings, Inc, ABRY Partners, LLC, Grande Investment LP

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Title: MANAGEMENT SERVICES AGREEMENT
Governing Law: Delaware     Date: 9/16/2009
Law Firm: Kirkland Ellis    

MANAGEMENT SERVICES AGREEMENT, Parties: atlantic broadband finance  llc , grande communications networks  llc , grande manager llc , grande parent llc , grande  grande communications holdings  inc  abry partners  llc  grande investment lp
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Exhibit 10.28

Execution Copy

MANAGEMENT SERVICES AGREEMENT

This Management Services Agreement (this “ Agreement ”) is entered into as of September 14, 2009 between Grande Communications Networks, LLC, a Delaware limited liability company (“ Grande ”), Atlantic Broadband Finance, LLC, a Delaware limited liability company (“ ABB ”) and Grande Manager LLC, a Delaware limited liability company (“ Grande Manager ”), who joins this Agreement only for the purposes of Section 3(c) below. Capitalized terms not otherwise defined herein (including in Section 7 hereof) shall have the meanings set forth in the Recapitalization Agreement (as defined herein).

WHEREAS, Grande has entered into that certain Recapitalization Agreement dated as of August 27, 2009 by and among ABRY Partners VI, L.P., Grande Communications Networks, Inc., predecessor-in-interest to Grande, Grande Communications Holdings, Inc., ABRY Partners, LLC, Grande Investment L.P., and Grande Parent LLC (the “ Recapitalization Agreement ”), and Grande Communications Holdings, Inc. has received the Grande Holdings Stockholders’ Approval as contemplated by the Recapitalization Agreement.

WHEREAS, Grande desires to engage ABB to provide management and other services to Grande, and ABB is willing to provide such services, all on the terms and conditions set forth in this Agreement.

THEREFORE, for good and valuable consideration, the receipt and sufficiency of which they hereby acknowledge, the parties agree as follows:

 

1.

Appointment . Grande hereby engages ABB, and ABB hereby agrees pursuant to the terms and conditions set forth herein, to provide certain services to Grande, as described in Section 3 hereof.

 

2.

Term . The term of this Agreement (the “ Term ”) shall commence at 12:01 a.m., Texas time, on the date hereof and shall continue until the earliest to occur of the following:

 

 

(a)

the Sale of ABB;

 

 

(b)

the Sale of Grande;

 

 

(c)

the Bankruptcy or Dissolution of ABB;

 

 

(d)

the termination of the Recapitalization Agreement pursuant to Article IX thereof;

 

 

(e)

the termination date upon which ABB and Grande mutually agree in writing; or

 

 

(f)

termination by Grande upon at least 30 days’ prior written notice to ABB, except that notice need not be given in advance if Grande or Grande Investment, L.P. determines that ABB has performed any of the Services in an illegal or grossly negligent manner or in a manner that constitutes willful misconduct.

 

3.

Services to be Provided . During the Term:

 

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(a)

Subject at all times to the authority of the board of directors (or the equivalent governing body) of Grande, ABB, by and through the Designated Personnel (who shall be employed by ABB), agrees to perform or cause to be performed in a professional manner general managerial oversight and such management services (including, finance, marketing and strategic planning) as mutually agreed upon from time to time by and among ABB and Grande (collectively, the “ Services ”) with respect to the business and operations of Grande and, so long as it remains an Affiliate of Grande, any Affiliated company to which all or a portion of Grande’s present broadband transport business or network services business may be transferred (an “ Affiliated Non-Core Company ”). Such Services shall include day-to-day oversight by the Designated Personnel of sales, marketing, customer service, administrative, accounting, financial reporting, and information technology services. Designated Personnel shall not be required to devote their time exclusively to Grande and/or to the performance of the Services.

 

 

(b)

ABB shall be responsible for and shall pay (i) pursuant to ABB’s customary payroll practices, the salaries, bonuses and other compensation of the Designated Personnel (for any period, the “ Designated Personnel Compensation ”), including related taxes and all costs of related benefits and perquisites, and (ii) any expenses of the Designated Personnel incurred in connection with the Services (for any period, the “ Expenses ” and together with the Designated Personnel Compensation, the “ Total Expenses ”). For the avoidance of doubt, any amounts owed and/or paid to the Designated Personnel as a result of their ownership interests in any Affiliate of Grande or ABB shall not be included in the amount of Total Expenses.

 

 

(c)

Grande Manager shall cause the Designated Personnel who serve as officers of ABB to become officers of Grande after Closing, and such Designated Personnel shall have the same titles at both ABB and Grande.

 

4.

Compensation .

 

 

(a)

In consideration for ABB for providing the Services to Grande and any Affiliated Non-Core Company, Grande shall pay to ABB during the period beginning on the Closing Date through the expiration of the Term (the “ Payment Period ”) the lesser amount of (i) (A) 5.5% of the total revenue of Grande, minus (B) the actual compensation expenses for all Grande employees who have positions that were included in the “corporate” compensation expense in the projections that were furnished to the lenders providing financing under the terms of the Recapitalization Agreement, or (ii) an amount equal to 50% of the Total Expenses (such lesser amount, the “ Management Fee ”). Notwithstanding anything herein or otherwise to the contrary, in no event will any Management Fee or other amount be payable by Grande to ABB unless and until the Closing occurs.

 

 

(b)

Within 30 days following the end of each calendar quarter during the Payment Period, ABB shall prepare a statement of the Management Fee for such calendar quarter. Payment by Grande in an amount equal to the Management Fee for such calendar quarter shall be due and payable by Grande on the thirtieth (30 th ) day following its receipt of such statement.

 

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5.

Representations and Warranties .

 

 

(a)

ABB is a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Delaware, and is duly qualified to do business as a foreign entity and is in good standing in the jurisdictions in which the character of its properties or the nature of its business makes such qualification necessary, except in jurisdictions, if any, where the failure to be so qualified would not, in the aggregate, reasonably be expected to result, in a material adverse effect. ABB has all requisite power and authority to own, use or lease its properties and to carry on its business as it is now being conducted except as would not, in the aggregate, reasonably be expected to cause a material adverse effect. ABB has provided to Grande a complete and correct copy of its certificate of formation as amended to date, which, as so made available, is in full force and effect. ABB is not in default in any respect in the performance, observation or fulfillment of any provision of its certificate of formation or operating agreement.

 

 

(b)

ABB has full power and authority to execute and deliver this Agreement and to perform the Services. The execution, delivery and performance of this Agreement have been duly and validly authorized by ABB’s Board of Managers or similar governing body, and no other limited liability company proceedings on the part of ABB are necessary to authorize this Agreement or to perform the Services. This Agreement has been duly and validly executed and delivered by ABB and, assuming the due authorization, execution and delivery hereof by Grande, constitutes the valid and binding obligation of ABB enforceable against ABB in accordance with their respective terms, except as such enforceability may be subject to the Enforceability Exception.

 

 

(c)

The execution and delivery of this Agreement and the performance by ABB of its respective obligations hereunder will not: (i) conflict with any provision of the certificate of formation or operating agreement of ABB; (ii) require ABB to obtain any consent, waiver, approval, order, authorization or permit of, or make a registration with, filing with or notification to, or breach any requirement applicable to ABB with any Governmental Authority; (iii) result in any violation of or the breach of or constitute a default (with notice or lapse of time or both) under, or give rise to any right of termination, cancellation or acceleration or guaranteed payments or a loss of a material benefit under, any of the terms, conditions or provisions of any Contract to which ABB is a party or by which ABB or any of its respective properties or assets may be bound; or (iv) violate the provisions of any Court Order or other Law applicable to ABB.

 

6.

Confidentiality and Non-Disclosure Obligations . As of the date hereof, ABB and Grande have entered into a Confidentiality Agreement in the form of the attached Exhibit A (the “ Confidentiality Agreement ”). ABB agrees and acknowledges that any and all non-

 

3


 

public information of Grande, including personally identifiable information of subscribers, that ABB obtains through or under the Recapitalization Agreement, this Agreement, the provision of Services hereunder or otherwise will be subject to the confidentiality and non-disclosure obligations of the Confidentiality Agreement. All obligations and rights under the Confidentiality Agreement shall survive the termination of this Agreement.

 

7.

Certain Definitions .

 

 

(a)

Bankruptcy ” means, with respect to an entity, (i) the making of a general assignment for the benefit of creditors, (ii) the entry of an order for relief in any bankruptcy, reorganization or insolvency proceeding, (iii) the filing or commencement by or against the entity of any application or petition for the appointment of a trustee, receiver or other similar official over the entity or any substantial part of the entity’s assets, or of any proceeding under any bankruptcy, insolvency or reorganization statute or liquidation or other law relating to relief of debtors, unless, in the case of such an action or proceeding filed or commenced against the entity without the entity’s acquiescence or consent, the action or proceeding is dismissed within ninety days after the date of its filing or commencement.

 

 

(b)

Closing ” has the meaning set forth in the Recapitalization Agreement.

 

 

(c)

Closing Date ” has the meaning set forth in the Recapitalization Agreement.

 

 

(d)

Designated Personnel ” shall mean those ABB personnel from time to time occupying the positions set forth on Schedule A attached hereto.

 

 

(e)

Dissolution ” means, with respect to an entity, the liquidation, dissolution, or winding up of such entity under (i) the entity’s governing documents or (ii) applicable law.

 

 

(f)

Grande Holdings Stockholders’ Approval ” has the meaning set forth in the Recapitalization Agreement.

 

 

(g)

Sale of ABB ” means (i) the consummation of any merger or consolidation of ABB with or into any other person or any sale of all or substantially all of the ownership interests or assets of ABB (other than a transaction following which the direct or indirect holders of the outstanding membership interests of ABB prior to such transaction together own a majority of the outstanding ownership interests of the surviving corporation or business entity); or (ii) ABRY Partners LLC and its affiliates shall cease to beneficially own and control, directly or indirectly, at least 51.0% of the membership interests of ABB or shall cease to have the right, directly or indirectly, to control ABB’s Board of Managers or similar governing body.

 

 

(h)

Sale of Grande ” means (i) the consummation of any merger or consolidation of Grande with or into any other person or any sale of all or substantially all of the

 

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ownership interests or assets of Grande (other than a transaction following which the direct or indirect holders of the outstanding membership interests or equivalent securities of Grande prior to such transaction together own a majority of the outstanding ownership interests of the surviving corporation or business entity, and other than pursuant to the Recapitalization Agreement); or (ii) ABRY Partners LLC and its affiliates shall cease to beneficially own and control, directly or indirectly, at least 51.0% of the membership interests of Grande or shall cease to have the right, directly or indirectly, to control Grande’s Board of Managers or similar governing body.

 

 

8.

Indemnification .

 

 

(a)

In the event that ABB or any of its Affiliates, principals, members, partners, directors, stockholders, employees (including the Designated Personnel), agents and representatives (collectively, the “ Indemnified Parties ”) becomes involved in any capacity in any action, proceeding or investigation in connection with the provision of the Services hereunder by ABB, other than any such action, proceeding or investigation by any ABRY Party, Grande Holdings or their respective Affiliates, Grande will indemnify and hold harmless the Indemnified Parties from and against any actual or threatened claims, lawsuits, actions or liabilities (including out-of-pocket expenses and the reasonable fees and expenses of counsel and other litigation costs and the cost of any preparation or investigation) of any kind or nature (“ Losses ”), arising as a result of or in connection with this Agreement and the Services, and will periodically reimburse the Indemnified Parties for their expenses as described above, except that Grande will not be obligated to so indemnify any Indemnified Party to the extent that, any such Losses arise as a result of or in connection with any illegal activity, bad faith, gross negligence or willful misconduct of such Indemnified Party or to the extent that such Indemnified Party is adjudged to be liable to Grande. ABB will certify to Grande in writing all Losses that are payable to ABB or other Indemnified Parties hereunder. The reimbursement and indemnity obligations of Grande under this Section 8(a) shall be in addition to any liability which Grande may otherwise have, shall extend upon the same terms and conditions to any Indemnified Party, as the case may be, and shall be binding upon and inure to the benefit of any successors or assigns of Grande, or ABB and of any successors, assigns, heirs and personal representatives of such Indemnified Party. The foregoing provisions shall survive the termination of this Agreement.

 

 

(b)

In the event that Grande or any of its Affiliates, principals, members, partners, directors, stockholders, employees, agents and representatives (collectively, the “ Grande Indemnified Parties ”) becomes involved in any capacity in any action, proceeding or investigation in connection with the provision of the Services hereunder by ABB, ABB will indemnify and hold harmless the Grande Indemnified Parties from and against any Losses arising as a result of or in connection with any illegal activity, bad faith, gross negligence or willful misconduct of ABB. Grande will certify to ABB in writing all Losses that are payable to Grande or other Grande Indemnified Parties hereunder. The

 

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reimbursement and indemnity obligations of ABB under this Section 8(b) shall be in addition to any liability which ABB may otherwise have, shall extend upon the same terms and conditions to any Grande Indemnified Party, as the case may be, and shall be binding upon and inure to the benefit of any successors or ass


 
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