Document:

EXHIBIT 10.04.01

 

 

 

GLOBAL SETTLEMENT
AGREEMENT

 

 

dated as of February 21,
2004,

 

 

between

 

 

ADELPHIA
COMMUNICATIONS CORPORATION

 

 

and

 

 

ADELPHIA BUSINESS
SOLUTIONS, INC.

d/b/a TelCove

 

 

 

 

GLOBAL SETTLEMENT
AGREEMENT

 

This
Global Settlement Agreement is made as of February 21, 2004, by and
between Adelphia Communications Corporation, a Delaware corporation (“ACC”),
debtor-in-possession, and Adelphia Business Solutions, Inc., a Delaware
corporation, d/b/a TelCove (“TelCove”),
debtor-in-possession.

 

W  I  T  N  E
S  S  E  T  H:

 

WHEREAS,
TelCove and certain of its wholly owned subsidiaries, commenced cases (the “TelCove
Cases”) under chapter 11 of title 11 of the United States Code,
11 U.S.C. Sections 101 et seq. (the “Bankruptcy
Code”) on March 27, 2002, and June 18, 2002, by filing voluntary
petitions with the United States Bankruptcy Court for the Southern District of
New York (the “Bankruptcy Court”), jointly administered under Case No.
02-11389; and

 

WHEREAS,
ACC and certain of its wholly owned subsidiaries commenced cases (the “ACC
Cases”) under chapter 11 of the Bankruptcy Code on June 10, 2002, June 25,
2002, and September 30, 2002, by filing voluntary petitions with the
Bankruptcy Court, jointly administered under Case No. 02-41729 (REG); and

 

WHEREAS,
ACC and TelCove are parties to that certain Master Reciprocal Settlement
Agreement (together with all Exhibits, Annexes and Schedules thereto) dated as
of December 3, 2003 (the “Master Agreement”), which validates, memorializes
and otherwise resolves the ownership of various operational assets, including
long-haul and metro fiber-optic cable assets, real property interests,
equipment, strands and network infrastructure between ACC and TelCove; and

 

WHEREAS,
TelCove and ACC and their applicable Affiliates have certain remaining unresolved
claims, defenses and counterclaims against each other; and

 

WHEREAS,
TelCove and ACC and their applicable Affiliates deny the accuracy and/or
validity of each other’s respective claims, defenses and counterclaims and
TelCove and ACC and their applicable Affiliates desire to enter into a full and
complete settlement with each other, which shall, together with the Master
Agreement and upon the fulfillment of certain conditions precedent, result in
the full and final release and waiver of all claims and counterclaims between
the parties, as well as any other unasserted or potential claims (except for
any claims that are expressly excluded from such release in accordance with the
terms of the Mutual Release, as defined below); and

 

WHEREAS,
upon the TelCove Emergence (as defined below) the parties agree that subject to
the terms hereof, ACC and its Affiliates shall make a certain payment to
TelCove, and ACC and TelCove (and their applicable Affiliates) shall enter into (i) a Mutual Release Agreement (“Mutual
Release”), substantially in the form attached hereto as Annex I;
(ii) a Commercial Services Agreement (“Commercial Services Agreement”),
substantially in the form attached hereto as Annex II, wherein the
parties thereto will agree to a certain business commitment for a five-year
period; (iii) an IP Transport Agreement (“IP Transport Agreement”),
substantially in the form attached hereto as Annex III, wherein ACC will
agree to provide certain

 

 

capacity to TelCove;
(iv) an IT License Exchange Agreement (“IT License Exchange Agreement”),
substantially in the form attached hereto as Annex IV, wherein ACC will
transfer certain license agreements specified therein to TelCove and TelCove
will assume certain liabilities related thereto, and TelCove will transfer
certain license agreements specified therein to ACC and ACC will assume certain
liabilities related thereto; (v) an Assignment and Assumption Agreement (“A&A
Agreement”), substantially in the form attached hereto as Annex V,
wherein TelCove will transfer certain agreements specified therein to ACC and
ACC will assume certain liabilities related thereto; (vi) an Amendment to the
Master Agreement (“MSA Amendment”), substantially in the form attached
hereto as Annex VI, wherein the parties will agree to modify certain
terms of the Master Agreement; (vii) an Asset Conveyance Agreement (“Conveyance
Agreement”), substantially in the form attached hereto as Annex VII,
by which certain CLEC market assets and associated specified rights and obligations
shall be transferred from ACC to TelCove; (viii) a non-executory IRU
Agreement (“IRU Agreement”), substantially in the form attached hereto
as Annex VIII, wherein ACC will grant to TelCove an indefeasible
right to use certain fiber-optic cable assets; (ix) a Maintenance
Agreement (“Maintenance Agreement”), substantially in the form attached
hereto as Annex IX, wherein the parties thereto will agree to
prospective rights and obligations related to the repair and maintenance of
various assets which shall be co-located or for which one party shall hold a
right of use; (x) a Collocation Agreement (“Collocation Agreement”),
substantially in the form attached hereto as Annex X, wherein the
parties thereto will grant each other the right to collocate communications
equipment at various sites and (xi) a Master Management Agreement (the “Master
Management Agreement”), substantially in the form attached hereto as Annex
XI; and

 

WHEREAS,
the parties have determined that the various transactions to be effected by
this Global Agreement and the eleven agreements annexed hereto (each an “Annex
Agreement” or an “Annex”) are beneficial to each corporation as a
whole, including all of its Affiliates, debtor and non-debtor alike; and

 

WHEREAS,
the parties have agreed in connection with this settlement that, with respect
to the telecommunication assets and rights relating thereto proposed to be
transferred to TelCove pursuant to this Global Agreement and the Annex
Agreements and consistent with Section 2.2(b), that, on the date of the
TelCove Emergence, all rights and obligations arising on or after such date
shall inure for the benefit of, or be borne by, TelCove, subject to applicable
law, regardless of whether legal title is ultimately transferred to TelCove;
and

 

WHEREAS,
the consummation of the Settlement contemplated by this Global Agreement and
the execution and delivery of the Annex Agreements is conditioned on the
approval of the Bankruptcy Court and certain other conditions set forth herein;

 

NOW,
THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
and subject to the terms and conditions hereof, the parties, intending to be
legally bound, hereby agree as follows:

 

2

 

ARTICLE I.   DEFINITIONS

 

1.1                                 Defined
Terms.  As used herein, the
terms below shall have the following respective meanings:

 

“A&A Contracts” means the contracts listed
on Schedule 2.1 to the A&A Agreement.

 

“A&A Cure Amounts” refers to the “Cure
Amounts” as defined in the A&A Agreement.

 

“ACC DIP Lenders’ Consent” means all necessary
approvals and consents (to be evidenced in the form of an amendment to the
below-described credit agreement on terms acceptable to ACC pursuant to which
ACC shall borrow funds to make the Cash Payment) with respect to the
consummation of the transactions contemplated by this Global Agreement required
under the Amended and Restated Credit and Guaranty Agreement, dated as of August 26,
2002 (as it may be amended), among UCA LLC, Century Cable Holdings, LLC,
Century-TCI California L.P., Olympus Cable Holdings, LLC, Parnassos, L.P.,
FrontierVision Operating Partners, L.P., ACC Investment Holdings, Inc., Arahova
Communications, Inc., and Adelphia California Cablevision, LLC, as Borrowers,
the Guarantors listed therein, the Lenders party thereto and the Agents party
thereto.

 

“ACC License Cure Amounts” refers to the “ACC
Cure Amounts” as defined in the IT License Exchange Agreement.

 

“ACC Material Adverse Effect” means any ruling,
holding, development or change in the ACC Cases related to the Settlement that
is materially adverse (as asserted by ACC and determined by the Bankruptcy
Court) to ACC and its Affiliates (taken as a whole), but only to the extent it
is not the result of a breach by ACC or its Affiliates of this Global Agreement.

 

“ACC Parties” means ACC and each of its
Affiliates that is required to become a signatory to any of the Annex
Agreements.

 

“Acquired
Assets” means the CLEC Market Assets, the Vehicles and the Garage.

 

“Adelphia
Marks” means the corporate name “Adelphia,” and any and all
variations or derivations thereof, or related or similar trade names,
trademarks, service marks or logos to which ACC or any other ACC Party hold
rights.

 

“Affiliate” means, with respect to either
party, (i) an entity controlled by such party for purposes of Rule 12b-2 of the
General Rules and Regulations of the Securities Exchange Act of 1934, as
amended, or (ii) an entity that is an “affiliate” of such party under
clause (B) of Section 101(2) of the Bankruptcy Code.

 

“Beal Consent” means all necessary approvals
and consents to the consummation of the transactions contemplated by this
Global Agreement required under the Secured Debtor in Possession Priming Credit
and Security Agreement, dated as of August 9, 2002, by and among Beal
Bank, S.S.B., TelCove and certain other direct or indirect subsidiaries of
TelCove.

 

3

 

“Board Approval” means the approval by the
Board of Directors of each of TelCove and ACC to the respective party’s
consummation of the Settlement.

 

“Business Day” means any day other than a
Saturday, Sunday or a legal holiday on which banking institutions in the State
of New York are not required to open.

 

“Capped Damages” means Damages with respect to
which a party and its Representatives shall be entitled to indemnity pursuant
to Section 7.2(a)(ii), or Section 7.2(b)(ii).

 

“CLEC Accounts Receivable” means the rights of
any ACC Party to payment for telephone, data transmission and other CLEC
services billed by or on behalf of any ACC Party and unpaid prior to the TelCove
Emergence as reflected on the billing records of any ACC Party relating to the CLEC
Market Assets, excluding any Verizon accounts receivable and any receivables
among ACC and its Affiliates.

 

“CLEC Annex Agreements” means the Conveyance
Agreement, the IRU Agreement, the Maintenance Agreement, the Collocation
Agreement and the Master Management Agreement.

 

“CLEC Assumed Contracts” means the contracts
and leases related to the CLEC Market Assets described on Schedule 2.2
to the Conveyance Agreement.

 

“CLEC Consents” means all Consents necessary to
consummate the CLEC Transactions.

 

“CLEC Market Assets” means (i) the assets
described on Schedule 2.1 to the Conveyance Agreement and (ii) the
CLEC Accounts Receivable.

 

“CLEC Market Employees” means, with respect to
any CLEC market, the CLEC Employees employed in such CLEC market.

 

“Code” means the Internal Revenue Code of 1986,
as amended, and the regulations thereunder, or any subsequent legislative
enactment thereof, as in effect from time to time.

 

“Compensation
Arrangement” means any written compensation arrangement other than an
Employee Plan or a Multiemployer Plan that provides to CLEC Employees any
compensation or other benefits, whether deferred or not, in excess of base
salary or wages and excluding overtime pay, including, but not limited to, any
bonus or incentive plan, stock rights plan, deferred compensation arrangement,
stock purchase plan, severance pay plan and any other perquisites and employee
fringe benefit plan.

 

“Consents” means all authorizations, permits,
licenses, certificates of authority, consents, Orders, filings, notices and
approvals of Governmental Entities and other third parties necessary for ACC,
TelCove and their respective Affiliates, as applicable, to consummate each of
the Global Transactions and the CLEC Transactions contemplated by this Global
Agreement in accordance with the terms hereof, excluding (i) the consent
of the Bankruptcy Court, (ii) clearance under the HSR Act, if applicable,
(iii) the Beal Consent, and (iv) the ACC DIP Lenders’ Consent.

 

4

 

“Employee Plan” means any written pension,
retirement, profit-sharing, deferred compensation, vacation, severance, bonus,
incentive, medical, vision, dental, disability, life insurance or any other
employee benefit or welfare plan as defined in Section 3(3) of ERISA
(other than a Multiemployer Plan) to which ACC or any of its Affiliates
contributes or which ACC or any of its Affiliates sponsors or maintains or by
which ACC or any of its Affiliates otherwise is bound, that provides benefits
to CLEC Employees.

 

“Employee Transfer Date” means, with respect to
any CLEC market, (i) the Global Closing Date, if none of the CLEC Market Assets
in such CLEC market comprise Managed Assets under the terms of the Master
Management Agreement, or (ii) the date on which the Master Management Agreement
terminates with respect to such CLEC market.

 

“ERISA” means the Employee Retirement Income
Security Act of 1974, as amended, and the regulations thereunder, as in effect
from time to time.

 

“Exhibits” means the exhibits to this Global
Agreement.

 

“FCC” means the Federal Communications
Commission.

 

“Global Agreement” means this Global Settlement
Agreement, including all Exhibits, Annexes and Schedules.

 

“Global Annex Agreements” means the Mutual Release,
the Commercial Services Agreement, the IP Transport Agreement, the IT License
Exchange Agreement, the A&A Agreement and the MSA Amendment.

 

“Global Consents” means all Consents necessary
to consummate the Global Transactions.

 

“Global Transactions” means the transactions
contemplated by Section 2.1 hereof.

 

“Governmental Entity” means any
(i) federal, state, local, municipal, foreign or other government;
(ii) governmental or quasi-governmental authority of any nature (including
any governmental agency, branch, commission, department, official, or entity
and any court or other tribunal); or (iii) body exercising, or entitled to
exercise any administrative, executive, judicial, legislative, police,
regulatory, or taxing authority or power of any nature, including any arbitral
tribunal.

 

“HSR Act” means the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and the rules and regulations thereunder.

 

“IT Licenses” means the license agreements
described in the IT License Exchange Agreement.

 

“Law” means any federal, state, local or
foreign statute, law, ordinance, regulation, rule, code, Order, principle of
common law, or judgment enacted, promulgated, issued, enforced or entered by
any Governmental Entity, or any other requirement or rule of law.

 

5

 

“Liabilities” means, as to any Person, all
debts, adverse claims, liabilities, commitments, responsibilities, and
obligations of any kind or nature whatsoever, direct, indirect, absolute or
contingent, of such Person, whether accrued, vested or otherwise, whether known
or unknown and whether or not actually reflected, or required to be reflected,
in such Person’s balance sheets or other books and records.

 

“Lien” means any lien, claim, pledge, option,
charge, hypothecation, easement, security interest, right-of-way, encroachment,
mortgage, deed of trust, or other encumbrance.

 

“Local Authority” means the applicable county,
municipal or other local authority exercising regulatory authority over the
placement or operation of any of the Acquired Assets in the applicable
jurisdiction of the local authority.

 

“Material Global Consents” means the Global Consents
and CLEC Consents designated by ACC and TelCove in writing as being material to
the consummation of the Global Transactions and the CLEC Transactions contemplated
hereby.

 

“Multiemployer Plan” means a plan, as defined
in ERISA Section 3(37) or 4001(a)(3), to which ACC or any trade or
business which would be considered a single employer with ACC under Section 4001(b)(1)
of ERISA or part of the same “controlled group” as the ACC under Section 302(d)(8)(C)
of ERISA, contributed, contributes or is required to contribute that provides
benefits to the CLEC Employees.

 

“Order” means any judgment, order, injunction,
writ, ruling, decree, stipulation or award of any Governmental Entity or
private arbitration tribunal.

 

“Person” means an individual, partnership,
joint venture, corporation, business trust, limited liability company, trust,
unincorporated organization, joint stock company, labor union, estate,
Governmental Entity or any other entity.

 

“Proceeding” means any action, arbitration,
audit, hearing, investigation, litigation or suit (whether civil, criminal,
administrative, Tax, investigative or informal) commenced, brought, conducted,
or heard by or before, or otherwise involving, any Governmental Entity or
arbitrator, excluding any FCC proceeding affecting the cable television or
telecommunications industry generally in which such Person is not a named party,
or any Governmental Entity proceeding that has arisen therefrom.

 

“Representative” means, with respect to any
Person, such Person’s officers, directors, employees, agents and
representatives (including any investment banker, financial advisor, accountant,
legal counsel, agent, representative or expert retained by or acting on behalf
of such Person or its subsidiaries).

 

“Schedules” means the schedules attached to the
Annex Agreements.

 

“Scheduling Order” means an Order of the
Bankruptcy Court, in form and substance acceptable to both ACC and TelCove.

 

6

 

“Settlement” means, collectively, the various
transactions contemplated by this Global Agreement and the Annex Agreements.

 

“Settlement Approval Order” means an order
entered by the Bankruptcy Court in the TelCove Cases and the ACC Cases,
approving the Settlement and the consummation of the transactions contemplated
by this Global Agreement, in form and substance acceptable to both ACC and
TelCove.

 

“Settlement Hearing” means the hearing to be
scheduled and conducted by the Bankruptcy Court to consider approval and entry
of the Settlement Approval Order.

 

“Settlement Motion” means the motion or motions
seeking approval and entry of the Scheduling Order and the Settlement Approval
Order, in form and substance acceptable to both ACC and TelCove.

 

“State PUC” means any state public service
and/or public utilities commission having regulatory authority over the Acquired
Assets, the CLEC Assumed Contracts, the IT Licenses and/or the A&A Contracts
located within such jurisdiction.

 

“Tax” means any federal, state, county, local,
foreign and other income, profits, gains, net worth, sales and use, ad valorem,
gross receipts, business and occupation, license, estimated, stamp, custom
duties, occupation, property (real or personal), franchise, capital stock,
license, excise, value added, payroll, employees, income withholding, social
security, unemployment or other tax, any penalty, addition to tax and interest
on the foregoing.

 

“TelCove Emergence” means the “Effective Date”
as defined in TelCove’s confirmed Chapter 11 plan.

 

“TelCove License Cure Amounts” refers to the “TelCove
Cure Amounts” as defined in the IT License Exchange Agreement.

 

“TelCove Material Adverse Effect” means
(i) any development, change or effect that is materially adverse to the
CLEC Market Assets, the CLEC Assumed Contracts, the Garage, the Vehicles or the
IT Licenses to be transferred to the TelCove Parties, taking all such assets as
a whole and only to the extent it is not the result of a breach of this Global Agreement
by TelCove or its Affiliates, or (ii) any ruling, holding, development or
change in the TelCove Cases related to the Settlement that is materially
adverse (as asserted by TelCove and determined by the Bankruptcy Court) to
TelCove and its Affiliates (taken as a whole), but only to the extent it is not
the result of a breach by TelCove or its Affiliates of this Global Agreement.

 

“TelCove Parties” means TelCove and each of its
Affiliates that is required to become a signatory to any of the Annex
Agreements.

 

“Third Party” means any Person other than (i)
ACC, the ACC Parties and their Affiliates and (ii) TelCove, the TelCove Parties
and their Affiliates.

 

“Transfer
Tax” means any federal, state, county, local, foreign and other sales, use,
transfer, conveyance, documentary transfer, recording or other similar tax, fee
or charge imposed

 

7

 

upon the sale, transfer
or assignment of property or any interest therein or the recording thereof, and
any penalty, addition to tax or interest with respect thereto, but such term
shall not include any tax on, based upon or measured by, the net income, gains
or profits from such sale, transfer or assignment of the property or any
interest therein.

 

“Uncapped
Damages” means Damages with respect to which a party and its
Representatives shall be entitled to indemnity pursuant to Section 7.2(a)(i),
or Section 7.2(b)(i).

 

1.2                                 Other
Defined Terms.  Each of
the following additional terms has the meaning given to such terms in the Section or
Annex set forth below:

 

	
  Term

  	
   

  	
  Section or Annex

  
	
   

  	
   

  	
   

  
	
  A&A
  Agreement

  	
   

  	
  Recitals

  
	
  ACC

  	
   

  	
  Preamble

  
	
  ACC Cases

  	
   

  	
  Recitals

  
	
  Annex Agreements

  	
   

  	
  Recitals

  
	
  Annexes

  	
   

  	
  Recitals

  
	
  Bankruptcy Code

  	
   

  	
  Recitals

  
	
  Bankruptcy Court

  	
   

  	
  Recitals

  
	
  Cash Payment

  	
   

  	
  Section 2.1(a)

  
	
  Claims Disputes

  	
   

  	
  Section 2.5(a)

  
	
  CLEC Employees

  	
   

  	
  Section 3.9

  
	
  CLEC
  Transactions

  	
   

  	
  Section 2.2(a)

  
	
  Collocation
  Agreement

  	
   

  	
  Recitals

  
	
  Commercial
  Services Agreement

  	
   

  	
  Recitals

  
	
  Conveyance
  Agreement

  	
   

  	
  Recitals

  
	
  Cure Disputes

  	
   

  	
  Section 2.5(a)

  
	
  Cure Period

  	
   

  	
  Section 5.4(c)

  
	
  Damages

  	
   

  	
  Section 7.2(a)

  
	
  Defaulting Party

  	
   

  	
  Section 6.2(b)

  
	
  Effective Date

  	
   

  	
  Conveyance Agreement

  
	
  Garage

  	
   

  	
  Section 3.8(a)(ii)

  
	
  Governmental
  Applications

  	
   

  	
  Section 4.12(a)

  
	
  Global Closing

  	
   

  	
  Section 2.4(a)

  
	
  Global Closing
  Date

  	
   

  	
  Section 2.4(a)

  
	
  IP Transport
  Agreement

  	
   

  	
  Recitals

  
	
  IRU Agreement

  	
   

  	
  Recitals

  
	
  Indemnified
  Party

  	
   

  	
  Section 7.3(a)

  
	
  Indemnifying
  Party

  	
   

  	
  Section 7.3(a)

  
	
  IT License
  Exchange Agreement

  	
   

  	
  Recitals

  
	
  Joint Rejection
  Order

  	
   

  	
  Section 2.5(a)

  
	
  Maintenance
  Agreement

  	
   

  	
  Recitals

  
	
  Master
  Management Agreement

  	
   

  	
  Recitals

  
	
  Master Agreement

  	
   

  	
  Recitals

  
	
  MSA Amendment

  	
   

  	
  Recitals

  
	
  Mutual Release

  	
   

  	
  Recitals

  

 

8

 

	
  Term

  	
   

  	
  Section or Annex

  
	
   

  	
   

  	
   

  
	
  Non-Assumed ACC
  Liabilities

  	
   

  	
  Section 2.5(b)

  
	
  Non-Assumed
  TelCove Liabilities

  	
   

  	
  Section 2.5(c)

  
	
  Notice

  	
   

  	
  Section 7.3(a)

  
	
  Rejection
  Damages Disputes

  	
   

  	
  Section 2.5(a)

  
	
  TelCove

  	
   

  	
  Preamble

  
	
  TelCove Cases

  	
   

  	
  Recitals

  
	
  Vehicles

  	
   

  	
  Section 3.8(a)(iii)

  

 

1.3                                 Other Definitional
Provisions.

 

(a)                                  The
words “hereof,” “herein” and “hereunder” and words of similar import when used
in this Global Agreement shall refer to this Global Agreement as a whole and
not to any particular provision of this Global Agreement, and Section references
are to a section of this Global Agreement (and not to a section of an
Annex) unless otherwise specified.

 

(b)                                 The
meanings given to terms defined herein shall be equally applicable to both
singular and plural forms of such terms.  Words denoting any gender shall include all
genders.  Where a word or phrase is
defined herein, each of its other grammatical forms shall have a corresponding
meaning.

 

(c)                                  Whenever
the words “include,” “includes” or “including” are used in this Global
Agreement (including the Annex Agreements), they shall be deemed to be followed
by the words “without limitation.”

 

ARTICLE II.   TERMS OF SETTLEMENT

 

2.1                                 The Global
Transactions.  Subject to the
terms and upon satisfaction of the conditions contained in this Global
Agreement, at the Global Closing:

 

(a)                                  ACC
shall pay to TelCove the following sum (the “Cash Payment”): (i) Sixty
Million Dollars ($60,000,000), plus (ii) Two Million Five Hundred Thousand
Dollars ($2,500,000), less the amounts of any payments made by ACC or its
Affiliates to TelCove or its Affiliates since January 1, 2004, with
respect to invoices for those services that are described on Exhibit 2.1
provided by TelCove or its Affiliates during the period January 1, 2003
through December 31, 2003.  The Cash
Payment shall be paid on the Global Closing Date by wire transfer of
immediately available funds (although if such wire shall be initiated after
10:00 a.m., Mountain time, the Cash Payment may not be credited to TelCove’s
account until the next occurring Business Day) to a bank account designated in
writing by TelCove no later than three (3) business days prior to the Global
Closing Date.

 

(b)                                 ACC
shall, or shall cause each applicable ACC Party to, transfer and convey the Vehicles
and the Garage to TelCove or such TelCove Party as shall be designated in
writing by TelCove no later than three (3) business days prior to the Global
Closing Date.

 

(c)                                  Each
of ACC and TelCove shall, and shall cause each of its applicable Affiliates to,
execute and deliver the Global Annex Agreements.

 

9

 

2.2                                 The CLEC
Transactions.

 

(a)                                  Subject
to the terms and upon satisfaction of the conditions contained in this Global
Agreement, upon the TelCove Emergence, each of ACC and TelCove shall, and shall
cause each of its applicable Affiliates to, execute and deliver each of the
CLEC Annex Agreements (the “CLEC Transactions”).

 

(b)                                 Upon
the TelCove Emergence, the Master Management Agreement shall effect the amendment
of the existing management agreements and other arrangements to the extent
necessary to effectuate the transfer of the economic benefits and burdens of
the telecommunications assets and rights to be transferred to TelCove pursuant
to this Agreement and the CLEC Annex Agreements; provided,
however, ACC shall continue to be
responsible for maintaining its ownership and control of all licenses,
franchises, permits and other non-assignable rights prior to the applicable Effective
Dates for the “Managed Assets” in accordance with the terms of, and as defined
in, the Master Management Agreement. 
Notwithstanding any provision of this Global Agreement or the CLEC Annex
Agreements to the contrary, pending the Effective Date with respect to such
Managed Assets, ACC shall retain actual (de facto) and
legal (de jure) control over such Managed Assets
to the extent required by applicable law, including with respect to any
licenses, franchises, permits or other governmental authorizations held by the
ACC Parties with respect thereto.

 

2.3                                 Consideration.
 Consideration for the Global
Transactions and the CLEC Transactions shall be the benefits received by the
TelCove Parties, or their respective Affiliates upon payment of the Cash
Payment and transfer of the Vehicles, the Garage and the CLEC Market Assets,
and the benefits received by the ACC Parties or the TelCove Parties, or their
respective Affiliates under the terms of each of the Annex Agreements, granting
the parties and their Affiliates rights and obligations in accordance with the
terms set forth therein.

 

2.4                                 Global Closing and
Subsequent Confirmations.

 

(a)                                  Time
and Place.  Subject to the satisfaction
or, to the extent permissible by Law, waiver (by the party for whose benefit
the condition is imposed) of the conditions described in Sections 5.1, 5.2
and 5.3, the closing of the Global Transactions (the “Global Closing”)
shall take place at the offices of Weil, Gotshal & Manges LLP, 767
Fifth Avenue, New York, New York 10153, or at such other place as ACC and
TelCove shall mutually agree, commencing at 10:00 a.m., Eastern time on
the date of the TelCove Emergence (the “Global Closing Date”).

 

(b)                                 Global
Closing Deliveries.

 

(i)                                     TelCove Deliveries. 
At the Global Closing, the TelCove Parties shall deliver to the ACC
Parties:

 

(1)                                          The
certificate described in Section 5.2(c) of this Global Agreement;

 

10

 

(2)                                          Each
of the Annex Agreements, substantially in the form attached hereto, duly
executed by the appropriate TelCove Parties to give full effect thereto by the
TelCove Parties;

 

(3)                                          All
other instruments of assignment and assumption, in form and substance
reasonably acceptable to ACC, as may be reasonably necessary to effect the assignment
of the IT Licenses the A&A Contracts being transferred to the ACC Parties, and
the assumption by the TelCove Parties of the IT Licenses being transferred thereto
pursuant to the IT License Exchange Agreement and the CLEC Assumed Contracts
being transferred thereto pursuant to the Conveyance Agreement;

 

(4)                                          Copies
of all instruments evidencing receipt of any Global Consents and CLEC Consents obtained
by the TelCove Parties to the extent not previously delivered; and

 

(5)                                          Such
other documents reasonably requested by ACC to consummate the Global
Transactions contemplated by this Global Agreement and reasonably required to
give effect to the Global Annex Agreements and to consummate the CLEC
Transactions and reasonably required to give effect to the CLEC Annex
Agreements

 

(ii)                                  ACC Deliveries.  At
the Global Closing, the ACC Parties shall deliver to the TelCove Parties:

 

(1)                                          the
Cash Payment;

 

(2)                                          The
certificate described in Section 5.3(c) of this Global Agreement;

 

(3)                                          Each
of the Annex Agreements, substantially in the form attached hereto, duly
executed by the appropriate ACC Parties to give full effect thereto by the ACC
Parties;

 

(4)                                          A
quit claim deed for the Garage, the original motor vehicle titles for the
Vehicles, and all other instruments of conveyance and transfer, or assignment
and assumption, in form and substance reasonably acceptable to TelCove, as may
be reasonably necessary (a) to convey or transfer to the TelCove Parties the Garage
and the Vehicles, (b) to effect the assignment of the IT Licenses being
transferred to the TelCove Parties, and the assumption by the ACC Parties of the
IT Licenses and the A&A Contracts being transferred thereto pursuant to the
IT License Exchange Agreement or the A&A Agreement and (c) to transfer or
assign the CLEC Market Assets and CLEC Assumed Contracts to the TelCove
Parties;

 

(5)                                          Copies
of all instruments evidencing receipt of any Global Consents and CLEC Consents obtained
by the ACC Parties to the extent not previously delivered;

 

(6)                                          FIRPTA
Certificate.  Certificates of
non-foreign status that comply with Section 1445 of the Code (and
applicable Treasury Regulations promulgated

 

11

 

thereunder) duly executed by each ACC Party
or, in the event that any such ACC Party is treated as an entity disregarded
for federal income tax purposes, by a Person treated as owning the assets of
such entity for federal income tax purposes; and

 

(7)                                          Such
other documents reasonably requested by TelCove to give effect to the Global
Transactions contemplated by this Global Agreement and reasonably required to
give effect to the Global Annex Agreements and to consummate the CLEC
Transactions and reasonably required to give effect to the CLEC Annex
Agreements.

 

(c)                                  Confirmation
of Effective Date of the Transfer of CLEC Market Assets.  In the event that the Effective Date of the
transfer of legal title to any CLEC Market Asset or CLEC Assumed Contract shall
be subsequent to the Global Closing Date, TelCove and ACC shall each notify the
other as to such Effective Date pursuant to the terms of the Conveyance
Agreement.  At each such Effective Date,
each of TelCove and ACC shall provide each other with copies of all instruments
evidencing receipt of any CLEC Consents to the extent not previously delivered
to the other party.

 

2.5                                 Assumed and
Non-Assumed Liabilities.

 

(a)                                  Third
Party Agreements.  In accordance with
section 365 of the Bankruptcy Code and in order to fully and finally
resolve all pending disputes between ACC and TelCove regarding each party’s
respective liability for (i) the cure amounts related to the assumption, and/or
the assumption and assignment of certain executory contracts and unexpired
leases, including any administrative claims related thereto (collectively, the “Cure
Disputes”); (ii) the rejection damages associated with the rejection of
certain executory contracts and unexpired leases pursuant to that certain Order
dated January 14, 2003 (the “Joint Rejection Order”), authorizing
the joint rejection by ACC and TelCove of certain executory contracts
(collectively, the “Rejection Damages Disputes”); and (iii) the
pre-petition and post petition liabilities associated with certain other
contracts and claims (the “Claims Disputes”), ACC and TelCove hereby
agree that as of the Global Closing Date, each party shall be responsible for
the Cure Disputes, the Rejection Damages Disputes and the Claims Disputes in
the amounts and as set forth on the following Exhibits annexed hereto:

 

Exhibit
2.5(a) – Joint Rejections:  The TelCove Parties shall accept liability
for the rejection damages associated with the Joint Rejection of the contracts
listed on Exhibit 2.5(a).

 

Exhibit
2.5(b) – ILEC Contracts:  ACC shall accept liability for all
obligations and liabilities associated with the CLEC market contracts listed on
Exhibit 2.5(b) incurred or otherwise outstanding up to the Global
Closing Date.  As of the Global Closing
Date, TelCove shall assume responsibility for all obligations and liabilities
associated with such contracts incurred after the Global Closing Date.

 

Exhibit
2.5(c) – TelCove Assumed and
Assigned to ACC:  TelCove
shall assume and assign to ACC the contracts listed on Exhibit 2.5(c)
and ACC shall cure any outstanding defaults, including any administrative
claims related thereto in the amounts as set forth thereon, and assume
responsibility for all obligations associated with such contracts.

 

12

 

Exhibit
2.5(d) – TelCove Assumed:  TelCove shall assume the contracts listed on Exhibit 2.5(d)
and ACC shall cure any outstanding defaults, including any administrative
claims related thereto, in the amounts as set forth on Exhibit 2.5(d).

 

Exhibit
2.5(e) – TelCove Rejections:  TelCove shall accept liability for the
rejection damages associated with the rejection of the contracts listed on Exhibit
2.5(e).

 

Exhibit
2.5(f) – VA Ring Contracts:  Telcove is the grantor of certain IRUs to
each of the third parties listed on Exhibit 2.5(f).  ACC and TelCove will cooperate in good faith
to negotiate a modified IRU agreement with each such third party, which
modified agreement will be assumed/assigned by TelCove to ACC, with ACC to be
liable for all attendant costs.  Notwithstanding
the joint efforts of ACC and TelCove to obtain modified IRU agreements from
such third parties, if such effort proves to be unsuccessful, then TelCove shall
be entitled to assume or reject any of the agreements listed on Exhibit
2.5(f), with any such rejection damages or cure amounts, as applicable, in
the TelCove estates, to be shared equally by ACC and TelCove.  In the event that TelCove rejects any
agreement listed on Exhibit 2.5(f) and thereafter, ACC enters into a new
IRU agreement with the party whose IRU agreement was rejected by TelCove, then
ACC shall reimburse TelCove for its previously paid portion of any such
rejection damages or cure costs.

 

Exhibit
2.5(g) – Omnibus Objection
Contracts:  ACC shall remain
liable for the pre-petition claims to the extent ultimately allowed by the
Court, associated with the contracts listed on Exhibit 2.5(g), in an amount
for each contract not to exceed the amount for such contract set forth on Exhibit 2.5(g).

 

Exhibit
2.5(h) – ACC Contracts to be Assigned
to TelCove:  Upon the later of
the Global Closing Date or the receipt of any Consent required in connection
with the assignment of each contract, ACC shall assign to TelCove the contracts
listed on Exhibit 2.5(h), and the customer contracts in effect on the
Global Closing Date that shall be listed on Schedule 2.2 to the
Conveyance Agreement, and ACC shall cure any outstanding defaults, including
any administrative claims related thereto in the amounts set forth on Exhibit 2.5(h)
or Schedule 2.2, as applicable. 
ACC shall remain liable for all obligations and liabilities associated
with each such contract up to the effective date of assignment of such
contract, and as of such date, TelCove shall assume responsibility for all
obligations and liabilities associated with each such contract arising after such
date.

 

With reference to Exhibit 2.5(b)
and Exhibit 2.5(h), and the business conducted with the CLEC Market
Assets, the ACC Parties shall remain liable up to the Global Closing Date for
all ordinary course trade payables and other accounts payable related to post-petition
services arising in respect of the CLEC Market Assets and CLEC Assumed
Contracts, subject to the terms of any applicable management agreements or
other management arrangements with TelCove or its Affiliates related thereto.  Subsequent to the Global Closing Date, ordinary
course trade payables and other accounts payable related to the CLEC Market
Assets and CLEC Assumed Contracts shall be the obligations of the TelCove Parties
in accordance with the terms of the Conveyance Agreement and the Master
Management Agreement.  In addition to the
foregoing, certain ACC

 

13

 

Parties and certain
TelCove Parties shall assume certain liabilities with respect to IT Licenses
pursuant to the terms of the IT License Exchange Agreement.

 

(b)                                 Non
Assumed TelCove Liabilities.All obligations or liabilities of the TelCove
Parties or their Affiliates of whatever kind or nature that are not expressly
assumed by the ACC Parties as provided in Section 2.5(a) above comprise
non-assumed liabilities (the “Non-Assumed TelCove Liabilities”).

 

(c)                                  Non
Assumed ACC Liabilities.  All
obligations or liabilities of the ACC Parties or their Affiliates of whatever
kind or nature that are not expressly assumed by the TelCove Parties as
provided in Section 2.5(a) above comprise non-assumed liabilities (the “Non-Assumed
ACC Liabilities”).

 

ARTICLE III.   REPRESENTATIONS
AND WARRANTIES OF THE PARTIES

 

TelCove, for itself and on behalf of each of the other
TelCove Parties, and ACC, for itself and on behalf of each of the other ACC
Parties, each hereby represents and warrants to the other party as follows (with
the term “such party” referring to, in the case of ACC’s representations and
warranties in this Article III, to each of the ACC Parties, and, in the
case of TelCove’s representations and warranties in this Article III, to
each of the TelCove Parties):

 

3.1                                 Existence,
Good Standing and Power.  Such party is a corporation validly existing
and in good standing under the laws of the State of its incorporation.  Subject to entry of the Settlement Approval
Order and any other Order granting Consent which may be necessary from the FCC
or a State PUC or other Governmental Entity, such party has all requisite power
and authority to execute and deliver this Global Agreement, the Annex
Agreements to which it is a party, and the other documents and instruments to be
executed and delivered to perform its obligations hereunder and
thereunder.  Such party is duly
authorized to transact business as a foreign corporation, partnership or other
legal entity, and is in good standing, in the states in which the Acquired Assets
are located and the CLEC Assumed Contracts, the IT Licenses and the A&A
Contracts are performed.

 

3.2                                 Authority.  The execution, delivery and performance of
this Global Agreement, and the Annex Agreements to which it is a party, and the
consummation by it of the transactions contemplated hereby and thereby have
been duly authorized by all necessary corporate action on the part of such
party.

 

3.3                                 Execution and Binding Effect.  This Global Agreement has been, and the Annex
Agreements to which it is a party when delivered at the Global Closing, shall
be, duly and validly executed and delivered by such party and, following the
entering of the Settlement Approval Order, this Global Agreement, and the Annex
Agreements to which it is a party following execution and delivery thereof by
such party and the transactions contemplated herein and therein shall
constitute, a valid and legally binding obligation of such party enforceable
against such party in accordance with its respective terms.

 

(a)                                  For each ACC Party:  Pursuant to the terms and conditions set
forth in Section 2.4 and Article V, each of the Annex Agreements
shall be duly executed by all ACC

 

14

 

Parties necessary for ACC and its Affiliates
to perform fully their obligations thereunder. 
Each of the ACC Parties (other than ACC) is an Affiliate of ACC.

 

(b)                                 For each TelCove Party:  Pursuant to the terms and conditions set
forth in Section 2.4 and Article V, each of the Annex Agreements
shall be duly executed by all TelCove Parties necessary for TelCove and its
Affiliates to perform fully their obligations thereunder.  Each of the TelCove Parties (other than
TelCove) is an Affiliate of TelCove.

 

3.4                                 No
Violation. Subject to the receipt of the Consents listed in Exhibit 3.5A
and Exhibit 3.5B, and subject to entry of the Settlement Approval Order,
the execution, delivery and performance by such party of this Global Agreement,
and the Annex Agreements to which it is a party, and the transactions
contemplated hereby, do not and will not conflict with or result in, with or
without the giving of notice or lapse of time or both, any violation of or
constitute a breach or default, or give rise to any right of acceleration,
payment, amendment, cancellation or termination, under (a) the certificate
of incorporation or bylaws of such party or any resolution adopted by the board
of directors of such party and not rescinded, (b) any material agreement
or other instrument to which such party is a party or by which such party or
any of its respective properties or assets is bound, (c) any Order to
which such party is bound or subject, (d) any Law, franchise, license or
permit of any Governmental Entity applicable to such party or any of its
respective properties or assets, or (e) except as provided for herein,
result in the imposition or creation of any Lien upon or with respect to any of
the assets to be assigned or transferred by it to another party pursuant
hereto.

 

3.5                                 Third-Party Consents.

 

(a)                                  For each ACC Party:  Except for (i) clearance under the
provisions of the HSR Act, if applicable, (ii) the Settlement Approval
Order, (iii) Board Approval, (iv) the ACC DIP Lenders’ Consent and
(v) any other Consents listed on Exhibit 3.5A hereto, the
execution, delivery and performance by each ACC Party of this Global Agreement,
the Annex Agreements to which such ACC Party is a signatory, and the
transactions contemplated hereby and thereby do not require any Consent.  Exhibit 3.5A specifies those
Consents that are required by each ACC Party with respect to each Annex
Agreement to which it is a party and whether such Consent is required with
respect to the Global Transactions or the CLEC Transactions.

 

(b)                                 For each TelCove Party:  Except for (i) clearance under the
provisions of the HSR Act, if applicable, (ii) the Settlement Approval
Order, (iii) Board Approval, (iv) the Beal Consent and (v) any
other Consents listed on Exhibit 3.5B hereto, the execution,
delivery and performance by each TelCove Party of this Global Agreement, the
Annex Agreements to which such TelCove Party is a signatory, and the
transactions contemplated hereby and thereby do not require any Consent.  Exhibit 3.5B specifies those
Consents that are required by each TelCove Party with respect to each Annex
Agreement to which it is a party and whether such Consent is required with
respect to the Global Transactions or the CLEC Transactions.

 

3.6                                 Brokers and Finders.  Such party has not engaged any broker or
other similar agent in connection with the matters contemplated by this Global
Agreement or the Annex Agreements.

 

15

 

3.7                                 Litigation.  Excluding the TelCove Cases and the
ACC Cases and other Proceedings connected thereto, and certain Proceedings
initiated by the Securities Exchange Commission and the Department of Justice,
to the best of such party’s knowledge, there are no Proceedings or Orders
pending or threatened against or affecting such party or relating to the
operation of such party’s business, at law or in equity, before any
Governmental Entity that might reasonably be expected to (i) result in
substantial and material impairment or loss of such party’s title to any assets
to be transferred to another party pursuant hereto, (ii) impede the operation
of the Acquired Assets in any material respect, or (iii) materially hinder
or impede the consummation of the transactions contemplated by this Global
Agreement, or its performance of its obligations under this Global Agreement
and the Annex Agreements to which it is a party.

 

3.8                                 Title
to Assets.

 

(a)                                  For each ACC Party:  (i) ACC or one of the other ACC Parties
has good and marketable title to, and the power and authority (subject to the
Settlement Approval Order) to transfer and assign the CLEC Market Assets, the
CLEC Assumed Contracts, the Vehicles, the Garage, and the IT Licenses being
transferred to the TelCove Parties pursuant to the IT License Exchange
Agreement, free and clear of all Liens or Liabilities, subject to the payment
by ACC or one of its Affiliates of the ACC License Cure Amounts and the A&A
Cure Amounts, and the satisfaction of rejection claims associated with the CLEC
Market Assets. (ii) The parking garage located at 718 North Main Street,
Coudersport, Pennsylvania (the “Garage”), that shall be transferred to
TelCove or an Affiliate thereof upon the Global Closing is described on Exhibit 3.8(a)(ii)
hereto.  (iii) The vehicles (the “Vehicles”)
that shall be transferred to TelCove or an Affiliate thereof upon the Global
Closing are listed on Exhibit 3.8(a)(iii) hereto.

 

(b)                                 For each TelCove Party:  TelCove or one of the other TelCove Parties
has good and marketable title to, and the power and authority (subject to the
Settlement Approval Order) to transfer and assign, the IT Licenses being
transferred to the ACC Parties pursuant to the IT License Exchange Agreement
and the A&A Contracts being transferred to the ACC Parties pursuant to the A&A
Agreement, free and clear of all Liens or Liabilities, subject to the payment
by TelCove or one of its Affiliates of the TelCove License Cure Amounts, and
the payments by ACC or one of its Affiliates of the A&A Cure Amounts.

 

3.9                                 Employees.  ACC has delivered to TelCove a complete list
of the names of all persons employed by ACC as of the date of this Global Agreement
directly and principally in connection with the operation of the CLEC Market
Assets (“CLEC Employees”), provided, however, the CLEC Employees exclude the employees listed on Exhibit 3.9.  ACC has delivered to TelCove a complete list
of the dates of hire and current rate of compensation of each CLEC Employee,
and current copies of summary plan descriptions of Employee Plans and
Compensation Arrangements, to the extent applicable, including a description of
ACC’s severance pay programs and policies applicable to the CLEC Employees.

 

ARTICLE IV.   COVENANTS OF THE PARTIES

 

4.1                                 Public
Announcements.  Prior to
the final Effective Date for any CLEC Assets, without the prior consent of the
other party, which consent shall not be unreasonably withheld, no party shall
issue a press release or otherwise make any public statements with respect to
the

 

16

 

transactions contemplated hereby, except as
may be required by Law, by obligations pursuant to any listing agreement with any
national securities exchange or over-the-counter market or with respect to
filings to be made with the Bankruptcy Court in connection with this Global
Agreement, the Annex Agreements or the transactions contemplated hereby or
thereby (in which case the party required to make such public statement shall
give the other party reasonable prior notice before making such public
statement).

 

4.2                                 Reasonable Efforts.

 

(a)                                  Each
of the parties hereto shall use reasonable, good faith efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, and to assist
and cooperate with the other party hereto in doing, all things necessary,
proper or advisable under applicable Law to ensure that the conditions set
forth in Article V of this Global Agreement are satisfied and to
consummate and make effective, in the most expeditious manner practicable, the
transactions contemplated by this Global Agreement.  Without limiting the generality of the
foregoing, the parties hereto shall furnish to each other such necessary
information and reasonable assistance, as each may request in connection with
the preparation and filing of applications and motion papers, including the
Settlement Motion needed to obtain Bankruptcy Court approval of the
transactions contemplated by this Global Agreement and the Annex Agreements,
and shall execute any additional instruments necessary to consummate the
transactions contemplated hereby.

 

(b)                                 ACC
shall not take any action which would reasonably be expected to have a TelCove
Material Adverse Effect except as otherwise may be ordered by the Bankruptcy
Court over ACC’s objection.  TelCove
shall not take any action which would reasonably be expected to have an ACC
Material Adverse Effect except as otherwise may be ordered by the Bankruptcy
Court over TelCove’s objection.

 

4.3                                 Notification of Certain Matters.  Each party shall give prompt notice to the
other party of (i) any notice or other communication from any Third Party
alleging that the consent of such Third Party is or may be required in
connection with the transactions contemplated by this Global Agreement and the
Annex Agreements, (ii) any written objection or Proceeding that challenges
the transactions contemplated hereby or by the Annex Agreements or the entry of
the Scheduling Order or the Settlement Approval Order, and (iii) any Orders
from the Bankruptcy Court that could reasonably be expected to materially delay
or prevent the consummation of the transactions contemplated hereby or by the
Annex Agreements; provided, however,
that the foregoing notice requirements shall exclude any objections,
Proceedings or Orders that the other party would reasonably have been expected
to receive as a party to the ACC Cases and the TelCove Cases.

 

4.4                                 Further Agreements.

 

(a)                                  ACC
authorizes and empowers TelCove on and after the Global Closing Date to receive
and to open all mail received by TelCove relating to the Vehicles, the Garage,
and certain IT Licenses being transferred to the TelCove Parties pursuant to
the IT License Exchange Agreement, and to deal with the contents of such
communications in any proper manner, provided, however, that TelCove shall promptly remit to ACC any cash,
checks,

 

17

 

refunds, or other instruments of payment in
respect of the Vehicles, the Garage or such IT Licenses for periods ending on
or before the Global Closing Date; and ACC shall promptly deliver to TelCove
any cash, checks, refunds, other instruments of payment, mail or other
communications received by ACC after the Global Closing Date pertaining to the
foregoing matters except that it may retain any cash, checks, refunds or other
instruments of payment in respect of the Vehicles, the Garage and the IT
Licenses being transferred to the TelCove Parties pursuant to the IT License
Exchange Agreement for periods ending on or before the Global Closing
Date.  TelCove shall promptly deliver to
ACC any mail or other communication addressed to ACC but received by TelCove
after the Global Closing Date which it is not authorized to receive and open
pursuant to the preceding sentence.  From
and after the Global Closing Date, ACC shall refer to TelCove all inquiries
with respect to the Vehicles, the Garage and the IT Licenses being transferred
to the TelCove Parties pursuant to the IT License Exchange Agreement.

 

(b)                                 TelCove
authorizes and empowers ACC on and after the Global Closing Date to receive and
to open all mail received by ACC relating to the A&A Contracts or certain
IT Licenses being transferred to the ACC Parties pursuant to the IT License
Exchange Agreement, and to deal with the contents of such communications in any
proper manner, provided, however,
that ACC shall promptly remit to TelCove any cash, checks, refunds, or other
instruments of payment in respect of the A&A Contracts or such IT Licenses
for periods ending on or before the Global Closing Date; and TelCove shall
promptly deliver to ACC any cash, checks, refunds, other instruments of
payment, mail or other communications received by TelCove after the Global
Closing Date pertaining to the foregoing matters except that it may retain any
cash, checks, refunds or other instruments of payment in respect of the A&A
Contracts or the IT Licenses being transferred to the ACC Parties pursuant to
the IT License Exchange Agreement for periods ending on or before the Global
Closing Date.  ACC shall promptly deliver
to TelCove any mail or other communication addressed to TelCove but received by
ACC after the Global Closing Date which it is not authorized to receive and open
pursuant to the preceding sentence.  From
and after the Global Closing Date, TelCove shall refer to ACC all inquiries
with respect to the A&A Contracts and the IT Licenses being transferred to
the ACC Parties pursuant to the IT License Exchange Agreement.

 

(c)                                  ACC
authorizes and empowers TelCove on and after the TelCove Emergence to receive
and to open all mail received by TelCove relating to the CLEC Market Assets and
the CLEC Assumed Contracts, and to deal with the contents of such
communications in any proper manner, provided, however, that TelCove shall promptly remit to ACC any cash,
checks or other instruments of payment (other than the CLEC Accounts
Receivable) in respect of the CLEC Market Assets or the CLEC Assumed Contracts for
periods ending on or before the TelCove Emergence; and ACC shall promptly
deliver to TelCove any cash, checks, refunds, other instruments of payment,
mail or other communications received by ACC after the TelCove Emergence
pertaining to the foregoing matters except that it may retain any cash, checks
or other instruments of payment (other than the CLEC Accounts Receivable) in
respect of the CLEC Market Assets or the CLEC Assumed Contracts for periods
ending on or before the TelCove Emergence. 
TelCove shall promptly deliver to ACC any mail or other communication
addressed to ACC but received by TelCove after the TelCove Emergence which it
is not authorized to receive and open pursuant to the preceding sentence.  From and after the TelCove Emergence, ACC
shall refer to TelCove all inquiries with respect to the CLEC Market Assets and
the CLEC

 

18

 

Assumed Contracts.  ACC shall promptly remit to TelCove any cash,
checks, refunds, or other instruments of payment that are part of the CLEC
Accounts Receivable and are received by ACC after the TelCove Emergence.

 

4.5                                 Payment of Transfer Taxes; Tax Filings.

 

(a)                                  Each
party shall request that the Bankruptcy Court rule that the transactions
contemplated in this Global Agreement and the Annex Agreements are exempt from
payment of Transfer Taxes.  If the
Bankruptcy Court or another court of competent jurisdiction denies such request
in a final order, all Transfer Taxes arising out of the transfer of the
Acquired Assets and any Transfer Taxes required to effect any recording or
filing with respect thereto, and any Transfer Taxes required to effect any
recording or filing with respect thereto, shall be borne one-half by ACC and
one-half by TelCove.  The Transfer Taxes
shall be calculated as of the Global Closing (or if later, each Effective Date with
respect to the assets transferred thereon) assuming that no exemption from
Transfer Taxes is available, except to the extent provided in the Settlement
Approval Order or to the extent that either party has provided an appropriate
resale exemption certificate or other evidence acceptable to the other party of
exemption from Transfer Taxes.  The
calculation of Transfer Taxes described in the preceding sentence shall be
based on returns or other filings relating to such Transfer Taxes, all of which
shall be prepared and agreed to before the Global Closing or if later, such
applicable Effective Date.  ACC and
TelCove shall cooperate to timely prepare before filing and timely file any
such returns or other filings relating to such Transfer Taxes, including any
claim for exemption or exclusion from the application or imposition of any
Transfer Taxes, for which purpose the parties shall prepare and deliver such
certificates as are required by relevant taxing authorities, if any, that are
reasonably necessary to support, in good faith, any claimed exemption from the
imposition of Transfer Taxes.

 

(b)                                 Each
party shall furnish or cause to be furnished to the other party, upon request,
as promptly as practicable, such information and assistance as is reasonably
necessary for (i) the preparation and filing of all income and other Tax
returns, including any claim for exemption or exclusion from the application or
imposition of any Taxes or making of any election related to Taxes, (ii) the
preparation for any audit by any taxing authority and (iii) the prosecution or
defense of any claim, suit or proceeding relating to any Tax return.  Each party acknowledges and agrees that any
such information furnished for such purposes may be disclosed by the other
party to any such taxing authority as required by applicable Law or Order of a
Governmental Entity or in any Proceedings relating thereto, subject to any
express written limitations that the parties may jointly put into effect with
respect thereto.

 

4.6                                 Proration of Taxes, Refunds and
Certain Charges.

 

(a)                                  Except
as provided in Section 4.6, all real property Taxes, personal property
Taxes or similar ad valorem obligations levied
with respect to the Vehicles, the Garage and the CLEC Market Assets, or refunds
with respect thereto, for any taxable period that includes, but does not begin
on, the Global Closing Date, whether imposed or assessed before or after the Global
Closing Date, shall be prorated between ACC and TelCove as of 11:59 PM on
the Global Closing Date based on the number of days before and including the Global
Closing Date and the number of days after the Global Closing Date in the period
to which such payment

 

19

 

or refund relates.  If any Taxes subject to proration are paid by
one party, the proportionate amount of such Taxes (or if a refund of any
portion of such Taxes previously paid is received, the proportionate amount of
such refund) shall be paid by (or to) the other party promptly after the
payment of such Taxes (or the receipt of such refund).

 

(b)                                 Installments
of special assessments or other charges on or with respect to the Vehicles, the
Garage and the CLEC Market Assets for any period in which the Global Closing
occurs, including all municipal, utility or authority charges for water, sewer,
electric or gas charges, garbage or waste removal, and cost of fuel, shall be
prorated and each party shall pay its proportionate share promptly upon the
receipt of any bill, statement or other charge with respect thereto.  If such charges or rates are assessed either
based upon time or for a specified period, such charges or rates shall be
prorated as of 11:59 PM on the Global Closing Date.  If such charges or rates are assessed based
upon usage of utility or similar services, such charges shall be prorated based
upon meter readings taken on the Global Closing Date.

 

(c)                                  Refunds and Reimbursements.

 

(i)                                     Subject
to the provisions of Section 4.4 (a) and (b), all refunds, reimbursements,
installments of license fees or other use-related revenue receivable by any
party to the extent attributable to the operation of the Vehicles and Garage or
the use of the IT Licenses being transferred to the TelCove Parties pursuant to
the IT License Exchange Agreement for any period in which the Global Closing
occurs shall be prorated so that ACC shall be entitled to that portion of any
such installment applicable to the period up to but not including the Global
Closing Date and TelCove shall be entitled to that portion of any such
installment applicable to any period from and after the Global Closing Date,
and if either party receives any such payments after the Global Closing Date,
it shall promptly remit to the other party its share of such payments.  Subject to the provisions of Section 4.4
(a) and (b), all refunds, reimbursements, installments of license fees or other
use-related revenue receivable by any party to the extent attributable to the
use of the A&A Contracts or the use of the IT Licenses being transferred to
the ACC Parties pursuant to the IT License Exchange Agreement for any period in
which the Global Closing occurs shall be prorated so that TelCove shall be
entitled to that portion of any such installment applicable to the period up to
but not including the Global Closing Date and ACC shall be entitled to that
portion of any such installment applicable to any period from and after the
Global Closing Date, and if either party receives any such payments after the
Global Closing Date, it shall promptly remit to the other party its share of
such payments.

 

(ii)                                  Subject
to the provisions of Section 4.4(c), all refunds, reimbursements,
installments of license fees or other use-related revenue (other than the CLEC
Accounts Receivable) receivable by any party to the extent attributable to the
operation of the CLEC Market Assets for any period in which the Global Closing
Date occurs shall be prorated in accordance with the amended management
agreements and other arrangements.

 

(d)                                 The
prorations pursuant to this Section 4.6 may be calculated after the Global
Closing Date as each item to be prorated (including any such Tax, obligation,
assessment, charge, refund, reimbursement, fee or revenue) accrues or comes
due.  Each proration shall be

 

20

 

calculated not later than thirty (30) days
after the parties obtain all information required to calculate such proration.

 

4.7                                 HSR
Act.  Each party, as necessary,
shall make appropriate filings of notifications and report forms pursuant to
the HSR Act with respect to the transactions contemplated hereby within ten
(10) Business Days after the date hereof, cooperate with each other with
respect thereto, and supply promptly any additional information and documentary
material that may be requested pursuant to the HSR Act.  In addition, each party shall promptly make
any other filing that may be required under any other antitrust law or by any
antitrust authority.  All such filings
shall comply in all material respects with the requirements of the respective
laws or regulations pursuant to which they are filed.  Each party shall bear its respective filing
fees associated with any HSR Act filings.

 

4.8                                 Bulk
Sales.  Each of the
parties hereto waives compliance with any applicable provisions of the Uniform
Commercial Code Article 6 (Bulk Sales or Bulk Transfers) or analogous
provisions of Law, as adopted in the states in which the Acquired Assets, CLEC
Assumed Contracts, IT Licenses and the A&A Contracts are located as such
provisions may apply to the transactions contemplated by this Global Agreement
and the Annex Agreements.

 

4.9                                 Settlement
Motion.

 

(a)                                  Within
four (4) Business Days after the execution and delivery of this Global
Agreement by the parties hereto, the parties shall file the Settlement Motion
seeking entry of the Scheduling Order and the Settlement Approval Order.  The Scheduling Motion, the Settlement Order and
the Settlement Approval Order (and any changes thereto) shall be in form and
substance satisfactory to both parties. 
The parties shall request the Bankruptcy Court to waive the ten (10) day
notice of appeal period under Rule 6004 (g).

 

(b)                                 Both
parties shall cooperate with filing and prosecuting the Settlement Motion and
any appropriate amendments thereto, and obtaining entry of the Scheduling Order
and the Settlement Approval Order, and the parties shall exchange prior to
filing, and as early in advance as is practicable to permit adequate and
reasonable time for each party and its counsel to review and comment, copies of
all proposed pleadings, motions, notices, statements, schedules, applications,
reports and other papers to be filed in connection with the Settlement Motion
and the relief requested therein.

 

(c)                                  Each
party shall give and publish notice of the Settlement Motion and Settlement
Hearing as required by the Scheduling Order.

 

4.10                           Disclosure
Exhibits and Schedules. 
Between the date hereof and the Global Closing Date, the Exhibits and
Schedules shall be subject to modification as mutually agreed to between ACC
and TelCove, subject to Bankruptcy Court approval, if required.  During such period, each party shall give
notice to the other party with respect to any matter arising or any information
obtained which, if existing, occurring or known at or prior to the date hereof,
would have been required to be set forth or described in any Exhibit or
Schedule, or which is necessary to complete or correct any information in any
such Exhibit or Schedule or in any representation and warranty of the
parties which has been rendered inaccurate thereby.  No information in such

 

21

 

notices shall modify or amend any Exhibit or Schedule for
any purpose hereunder, including for determining the satisfaction of the
conditions set forth in Article V hereof, except as agreed to by both ACC
and TelCove.

 

4.11                           Inspection and Maintenance of Acquired
Assets and Related Records.

 

(a)                                  ACC
covenants that during the period between the date hereof and the Global Closing,
it shall maintain in the ordinary course of business, consistent with past
practices, the Vehicles and the Garage to be conveyed by ACC or its Affiliates on
the Global Closing Date.  Subject to the
existing management agreements or other arrangements in effect with TelCove and
its Affiliates, ACC covenants that during the period between the date hereof
and the Global Closing Date with respect to any CLEC Assets, it shall maintain
in the ordinary course of business, consistent with past practices, the CLEC
Market Assets to be conveyed by ACC or its Affiliates pursuant to the
Conveyance Agreement.

 

(b)                                 From
and after the date hereof, except as prohibited by Law, ACC agrees
(i) that it shall grant to TelCove’s Representatives reasonable access
during regular business hours to make such investigation of the Vehicles, the Garage,
the CLEC Assumed Contracts and the CLEC Market Assets, and such party’s books
and records related thereto, as such other party reasonably deems necessary or
advisable, to inspect the Vehicles, the Garage, the CLEC Assumed Contracts and
the CLEC Market Assets prior to the Global Closing, (ii) that it shall instruct
its employees to cooperate in any such investigation, and (iii) that it
shall keep such books and records in a manner consistent with past practice and
such books and records shall not be destroyed for at least three years from the
Global Closing Date, provided, however, if TelCove shall request by
notice to ACC within the six-month period prior to the third anniversary of the
Global Closing Date that TelCove be given possession of any such books and
records in lieu of the destruction thereof, such books and records shall be
delivered to TelCove at its expense when ACC no longer has use for such books
and records.

 

4.12                           FCC, State
and Other Governmental Applications.

 

(a)                                  As
promptly as practicable with respect to FCC and State PUC or other state agency
Consents, and within twenty (20) Business Days after the date hereof with
respect to Consents of other Governmental Entities, each party shall prepare
and deliver to the other party, its portions of all required applications for
approval by the FCC, State PUCs or other state agencies, and other Governmental
Entities, and such other documents as may be required, with respect to the
consummation of the transactions contemplated hereby and by the Annex
Agreements (“Governmental Applications”).  As promptly as practicable thereafter and in
any event within twenty-five (25) Business Days after the date hereof with
respect to FCC and State PUC or other state agency Consents, and within forty-five
(45) Business Days after the date hereof with respect to Consents of other
Governmental Entities, the parties shall file, or cause to be filed, the
Governmental Applications.  If the Global
Closing or any Effective Date, as applicable, shall not have occurred for any
reason within any applicable consummation period relating to any Governmental
Entity’s grant of any Governmental Application, and neither party has
terminated this Global Agreement in accordance with Article VI, the
parties shall jointly request one or more extensions of the consummation period
of such grant.

 

22

 

(b)                                 The
parties shall each use their commercially reasonable efforts to prosecute the
Governmental Applications in good faith and with due diligence before any
Governmental Entity and in connection therewith shall take such action or
actions as may be necessary or reasonably required in connection with the
Governmental Applications, including furnishing to any Governmental Entity any
documents, materials, or other information requested by that body in order to
obtain such Consents as expeditiously as practicable.  Neither party hereto shall knowingly take, or
fail to take, any action if the intent or reasonably anticipated consequence of
such action or failure to act is, or would be, to cause any Governmental Entity
not to grant approval of any Governmental Application or materially delay
either such approval or the consummation of the transactions contemplated
hereby and by the Annex Agreements.

 

(c)                                  Each
party shall promptly inform the other of any communication from any
Governmental Entity regarding any of the transactions contemplated by this
Global Agreement and the Annex Agreements. 
If any party or Affiliate thereof receives a request for additional
information or documentary material from any such Governmental Entity with
respect to the transactions contemplated by this Global Agreement and the Annex
Agreements, then such party will use its reasonable efforts to make, or cause
to be made, as soon as reasonably practicable and after consultation with the
other party, an appropriate response in compliance with such request.

 

(d)                                 Each
of ACC and TelCove shall bear its own expenses in connection with the
preparation and prosecution of the Governmental Applications and the costs of
any franchise or other governmental authorizations required to be obtained by
such party in connection with the grant of any of the Governmental Applications
or otherwise required to consummate the Settlement, except that the following
expenses will be borne one-half by ACC and one-half by TelCove: (i) all
filing fees and similar routine charges by a Governmental Entity with respect
to federal or state Governmental Applications; and (ii) all fees and
expenses of a single counsel retained jointly by the parties to prepare and
prosecute any Governmental Application.

 

4.13                           Lien
Searches.  Prior to the TelCove
Emergence, ACC shall provide to TelCove copies of whatever UCC, tax, Lien and
judgment searches shall have been done in jurisdictions that pertain to the CLEC
Market Assets.  TelCove may, at its
expense, obtain any additional UCC, tax, Lien and judgment searches that it
elects to obtain.

 

4.14                           Taxes.  The parties will use reasonable best
efforts to give notice to all jurisdictions that might reasonably be expected
to have claims in the ACC Cases or the TelCove Cases for Taxes or assessments
related to, based upon or measured by the Acquired Assets, advising such
jurisdictions that the parties are seeking an order of the Bankruptcy Court
that the Acquired Assets would be sold free and clear of all Liens and
informing such jurisdictions of the time and date of the Settlement Hearing.

 

4.15                           Compliance with Contracts and Operation
of Business.  Between the date hereof
and the Global Closing Date, (i) ACC shall use its commercially reasonable
efforts in the context of the ACC Cases, to comply in all material respects
with the terms of the IT Licenses and the CLEC Assumed Contracts to be transferred
to the TelCove Parties and to operate the business related to the CLEC Market
Assets in the ordinary course of business, and (ii) TelCove shall use its
commercially reasonable efforts in the context of the TelCove Cases, to comply
in all material

 

23

 

respects with the terms of the A&A
Contracts and the IT Licenses to be transferred to the ACC Parties.

 

4.16                           Execution
by ACC and TelCove on behalf of Affiliates.  ACC shall cause its Affiliates to comply with
the provisions of this Global Agreement as if they were signatories hereto and
included within the terms “ACC” and “ACC Parties” as used herein.  TelCove shall cause its Affiliates to comply
with the provisions of this Global Agreement as if they were signatories hereto
and included within the terms “TelCove” and “TelCove Parties” as used herein.

 

4.17                           Consents.

 

(a)                                  ACC
shall give all notices of this Global Agreement and the Annex Agreements and
the transactions contemplated hereby and thereby to all Persons to whom notice
is required to be given under any CLEC Assumed Contract or any applicable IT
License or under any other agreement to which any ACC Party is a party.  ACC shall use commercially reasonable
efforts, and TelCove shall assist ACC in all reasonable respects, to obtain all
Consents that ACC requires to consummate the Global Transactions and the CLEC
Transactions.

 

(b)                                 TelCove
shall give all notices of this Global Agreement and the Annex Agreements and
the transactions contemplated hereby and thereby to all Persons to whom notice
is required to be given under any applicable IT License or A&A Contract or
any other agreement to which any TelCove Party is a party.  TelCove shall use commercially reasonable
efforts, and ACC shall assist TelCove in all reasonable respects, to obtain all
Consents that TelCove requires to consummate the Global Transactions and the
CLEC Transactions.

 

(c)                                  ACC
will not agree to any materially adverse change in any CLEC Assumed Contract or
IT License to which it is a party as a condition to obtaining any Consent
without the written consent of TelCove. 
ACC will be solely responsible for any consideration given or promised
to Third Parties for resolution of any claims (disputed or undisputed) that
must be settled to obtain any Consent to assign any CLEC Assumed Contract or IT
License being transferred to the TelCove Parties pursuant to the IT License
Exchange Agreement, and TelCove shall have no obligation to make any payment to
any other party in assisting ACC in obtaining any Consent to the assignment of
such CLEC Assumed Contract or IT License being transferred to the TelCove
Parties pursuant to the IT License Exchange Agreement or to agree to any
materially adverse change in such CLEC Assumed Contract or IT License being
transferred to the TelCove Parties pursuant to the IT License Exchange
Agreement.  TelCove will not agree to any
materially adverse change in any IT License to which it is a party or any A&A
Contract as a condition to obtaining any Consent without the written consent of
ACC.  TelCove will be solely responsible
for any consideration given or promised to Third Parties for resolution of any
claims (disputed or undisputed) that must be settled to obtain any Consent to
assign any IT License to which it is a party, and ACC shall have no obligation
to make any payment to any other party in assisting TelCove in obtaining any
Consent to the assignment of such IT License being transferred to the ACC Parties
pursuant to the IT License Exchange Agreement or to agree to any materially
adverse change in such IT License.  ACC
will be solely responsible for the A&A Cure Amounts and any other
consideration given or promised to Third Parties for resolution of any claims
(disputed or undisputed) that must be settled to obtain any Consent to

 

24

 

assign any A&A Contract, and TelCove
shall have no obligation to make any payment to any other party in assisting
ACC in obtaining any Consent to the assignment of such A&A Contract being
transferred to the ACC Parties pursuant to the A&A Agreement.

 

(d)                                 Any
instrument evidencing any Consent shall be reasonably acceptable to ACC and
TelCove.  Each party will furnish the
other party with copies of all correspondence from or to any Person, and notify
the other party of any other communications with any Person, relating to the
obtaining of any Consent (other than privileged communications between such
party and its attorneys).

 

(e)                                  ACC
will pay all expenses in connection with obtaining any Consent to the
assignment of any CLEC Assumed Contract or IT License being transferred to the
TelCove Parties pursuant to the IT License Exchange Agreement.  TelCove will pay all expenses in connection
with obtaining any Consent to the assignment of any A&A Contract and any IT
License being transferred to the ACC Parties pursuant to the IT License
Exchange Agreement.

 

4.18                           No
Continuation of Business. 
TelCove and ACC each confirms that its business is not a continuation
of, nor is it related to, the business of the other, and each party covenants
that it will not, in any way, represent that its business is a continuation of
or related to the business of the other party.

 

4.19                           Employee
Matters.  With respect to
each CLEC market, as of the Employee Transfer Date for such CLEC market, ACC
shall terminate employment of all such CLEC market’s CLEC Market Employees, and
upon such Employee Transfer Date, TelCove shall make offers of employment to
all of such CLEC Market Employees, which, if accepted by the CLEC Market
Employees, shall be effective as of such Employee Transfer Date.  TelCove acknowledges that the employees
listed on Exhibit 3.9 may continue to be employed through the TelCove
Emergence and thereafter by ACC or an Affiliate thereof.  ACC shall not, between the date hereof and any
Employee Transfer Date, increase the compensation and benefits of the CLEC
Employees in a manner exceeding the applicable levels of increases established
in its compensation and benefits programs for its other employees.  TelCove shall offer each CLEC Employee
compensation and benefit packages that are not less favorable than the
compensation and benefit packages provided to similarly situated employees of
TelCove.  For purposes of all employee
benefit plans, programs and policies of TelCove for which any CLEC Employee may
become eligible, TelCove shall give credit for all service for which such CLEC
Employee has been credited by ACC. 
TelCove shall offer health plan coverage to all CLEC Employees on terms
and conditions generally applicable to TelCove’s similarly situated
employees.  For purposes of providing
such coverage, TelCove shall waive all preexisting condition limitations for
all such CLEC Employees to the extent that such employees were not subject to
preexisting condition limitations under ACC’s health care plan, and shall
provide such health care coverage effective as of the applicable Employee
Transfer Date without the application of any eligibility period for
coverage.  In addition, TelCove shall
cause TelCove’s health care plans to credit all employee payments toward costs
related to deductibles and out-of-pocket maximums (provided such payments and
maximums are incurred and claims submitted within on one month of the applicable
Employee Transfer Date), under ACC’s health care plans for the plan year which
includes the applicable Employee Transfer Date as if such payments had been
made for similar purposes under TelCove’s health care plans during the plan
year which includes the applicable

 

25

 

Employee Transfer Date, with respect to CLEC
Employees.  For each CLEC Employee,
TelCove shall honor all accrued vacation not taken by such employee prior to the
applicable Employee Transfer Date for the calendar year in which the applicable
Employee Transfer Date occurs.  In the
event that any CLEC Employee shall accept employment by TelCove or an Affiliate
as of any applicable Employee Transfer Date, TelCove shall hold ACC and its
Affiliates harmless from any claims by such terminated employee for any
severance pay or similar compensation from ACC and its Affiliates.  In addition, if any such CLEC Employee shall
be terminated by TelCove within six months of the applicable Employee Transfer
Date, such CLEC Employee shall receive the same severance benefits from TelCove
as such employee otherwise would have received under the applicable ACC
severance plan, as if such CLEC Employee been terminated from ACC.

 

4.20                           Removal
of Adelphia Marks.  Any
license granted to TelCove to use the Adelphia Marks will terminate three
months following TelCove Emergence. 
Within three months of TelCove Emergence, TelCove (i) shall have filed
with all necessary and appropriate Governmental Entities, at the state, local
and county levels, all documents, certificates and other instruments necessary
to change the corporate or assumed names of TelCove and any Affiliate of
TelCove so as not to include the Adelphia Marks, and (ii) shall have removed or
covered, or caused to have been removed or covered, from the CLEC Market Assets
and any of TelCove’s assets any and all names, marks and logos constituting the
Adelphia Marks.  Notwithstanding the
foregoing, TelCove will not be required to remove any Adelphia Mark that is
affixed to items in or to be used in customer homes or properties, or as are
used in similar fashion making such removal impracticable for TelCove.

 

4.21                           Use
of “Adelphia Business Solutions”.  To avoid confusion, ACC agrees that following
TelCove Emergence it shall not include the name “Adelphia Business Solutions”
in the name of any Affiliate or permit any Affiliate to do business under a
trade name including the name “Adelphia Business Solutions.”

 

4.22                           Real
Estate Transactions.  The
ACC Parties and the TelCove Parties shall consummate the transactions
contemplated by the Real Estate Transfer Agreement, as shall be agreed to
between the ACC Parties signatory thereto and the TelCove Parties signatory
thereto, prior to or on the Global Closing Date.

 

4.23                           Access to Records and Personnel;
Cooperation re Third-Party Claims.  From
and for a five-year period after
the Global Closing, ACC and TelCove shall each continue to retain such records
and information as are required to be retained by any applicable taxing
authority, and shall each allow the other party and its authorized
representatives, reasonable access during normal business hours to the books,
records, documents, facilities and employees of such other party and have the
right, upon reasonable prior notice, to inspect and to make copies of any
books, records or other files of the other parties or its Affiliates that the
inspecting party shall reasonably require with respect to (i) transactions
between the parties and their Affiliates, (ii) their commingled or
interrelated businesses or operations, or (iii) such inspecting party’s operations,
in each case with respect to the time period prior to and including the Global
Closing Date, at any time during regular business hours for any proper purpose,
including in connection with the preparation of Tax returns or other Tax
filings or financial statements or responding to any Third-Party claim in
respect of which either party may have liability hereunder.  ACC and

 

26

 

TelCove each agrees to cooperate with the
other in its prosecution and/or defense of any Third-Party claims and to
provide the other party with any information that, to its knowledge, is
relevant to the issues in the Third-Party claims.  Subject to reimbursement by the requesting
party of any actual and reasonable out-of-pocket expenses incurred by the
disclosing party (not including any that would have been incurred by the
disclosing party in the absence of such request), each of ACC’s and TelCove’s
employees shall be made available to the other, and its authorized
representatives, as shall reasonably be requested, for the purpose of
prosecuting any Third-Party claims and defending against any Third-Party claims
asserted against ACC, TelCove or any of their Affiliates, and preparing for or
testifying in any court proceedings, and responding to any discovery requests
with respect thereto.

 

4.24                           Cooperation
regarding Bankruptcy.  In
consideration for entering into the Global Settlement Agreement and all related
documents and agreements, the TelCove Parties hereby acknowledge and agree that
the TelCove Parties shall not oppose, in any manner or form, whether by filing
an objection, voting to reject or otherwise, any plan of reorganization under
chapter 11 of the Bankruptcy Code submitted by the ACC Parties in the ACC Cases
or any disclosure statement pursuant to section 1125 of the Bankruptcy
Code related thereto (provided any such plan of reorganization shall not be
inconsistent with the terms hereof), and the TelCove Parties hereby waive and
release any such right.

 

4.25                           Payment
of Current Invoices.  ACC
or its Affiliates shall pay in the ordinary course following the Global Closing
Date the amount, with any appropriate adjustments, of any invoices unpaid as of
the Global Closing Date for those services that are described on Exhibit 2.1
provided by TelCove or its Affiliates on and after January 1, 2004.

 

ARTICLE V.   CONDITIONS TO OBLIGATIONS OF THE PARTIES

 

5.1                                 Conditions
Precedent to Obligations of the Parties.  The respective obligations of ACC and TelCove
to consummate the Global Transactions and the CLEC Transactions shall be
subject to the satisfaction at or prior to the Global Closing of each of the
following conditions:

 

(a)                                  No
Injunction.  No preliminary or
permanent injunction or other Order issued by any Governmental Entity nor any
Law or Order promulgated or enacted by any Governmental Entity shall be in
effect or pending that restrains, enjoins or otherwise prohibits the Global
Transactions or the CLEC Transactions.

 

(b)                                 The
Settlement Approval Order.  The
Bankruptcy Court shall have entered the Settlement Approval Order in form and
substance mutually acceptable to ACC and TelCove.

 

(c)                                  HSR
Act.  Any applicable waiting period
under the HSR Act relating to the Settlement shall have expired or shall have
been earlier terminated.

 

(d)                                 Board
Approval.  Each of TelCove and ACC
shall have obtained Board Approval.

 

(e)                                  Beal
Consent.  TelCove shall have obtained
the Beal Consent, which shall not be subject to the satisfaction of any
condition that has not been satisfied or waived and which shall be in full
force and effect.

 

27

 

 

(f)                                    ACC
DIP Lenders’ Consent.  ACC shall have
obtained the ACC DIP Lenders’ Consent, which shall not be subject to the
satisfaction of any condition that has not been satisfied or waived, which
shall be in full force and effect, and shall provide ACC the capacity to
drawdown funds to make the Cash Payment.

 

5.2                                 Conditions Precedent to Obligations
of ACC.  The obligation of ACC to
consummate the Global Transactions and the CLEC Transactions is subject to the
satisfaction (or waiver by ACC) at or prior to the Global Closing of each of
the following additional conditions:

 

(a)                                  Accuracy
of Representations and Warranties. 
The representations and warranties of the TelCove Parties contained
herein or in any of the Annex Agreements shall be true in all material respects
on and as of the Global Closing Date, with the same force and effect as though
such representations and warranties had been made on and as of the Global
Closing Date.

 

(b)                                 Performance
of Global Agreement  The TelCove
Parties shall have, in all material respects, performed and complied with all
covenants, obligations and agreements contained in this Global Agreement
required to be performed or complied with by it prior to the Global Closing.

 

(c)                                  Officer’s
Certificate.  ACC shall have received
a certificate of an authorized officer of TelCove, dated the Global Closing
Date, to the effect that the conditions specified in Sections 5.2 (a) and (b)
above have been fulfilled.

 

(d)                                 Deliveries.  The TelCove Parties shall have made or stand
willing to make the deliveries specified in Section 2.4(b)(i).

 

(e)                                  Other
Consents and Approvals.  All Material
Global Consents designated by ACC shall have been obtained, made or given in
form and substance reasonably acceptable to ACC, and be in full force and
effect, except for any Material Global Consents that are not required due to
the entry by the Bankruptcy Court of the Settlement Approval Order.

 

(f)                                    No
ACC Material Adverse Effect.  Between
the date hereof and the Global Closing, there shall not have been any development,
change or effect which constitutes or has resulted in, or that would reasonably
be expected to result in, an ACC Material Adverse Effect.

 

5.3                                 Conditions Precedent to Obligations
of TelCove.  The obligation of
TelCove to consummate the Global Transactions and the CLEC Transactions is
subject to the satisfaction (or waiver by TelCove) at or prior to the Global
Closing of each of the following additional conditions:

 

(a)                                  Accuracy
of Representations and Warranties. 
The representations and warranties of the ACC Parties contained herein
or in the Annex Agreements shall be true in all material respects on and as of
the Global Closing Date, with the same force and effect as though such
representations and warranties had been made on and as of the Global Closing
Date.

 

28

 

(b)                                 Performance
of Global Agreement.  The ACC Parties
shall have, in all material respects, performed and complied with all
covenants, obligations and agreements contained in this Global Agreement
required to be performed or complied with by it prior to the Global Closing.

 

(c)                                  Officer’s
Certificate.  TelCove shall have
received a certificate of an authorized officer of ACC, dated the Global Closing
Date, to the effect that the conditions specified in Sections 5.3 (a) and (b) above
have been fulfilled.

 

(d)                                 Deliveries.  The ACC Parties shall have made or stand
willing to make all of the deliveries specified in Section 2.4(b)(ii).

 

(e)                                  Other
Consents and Approvals.  All Material
Global Consents designated by TelCove shall have been obtained, made or given
in form and substance reasonably acceptable to TelCove, and be in full force
and effect, except for any Material Global Consents that are not required due
to the entry by the Bankruptcy Court of the Settlement Approval Order.

 

(f)                                    No
TelCove Material Adverse Effect. 
Between the date hereof and the Global Closing, there shall not have
been any development, change or effect which constitutes or has resulted in, or
that would reasonably be expected to result in a TelCove Material Adverse
Effect.

 

5.4                                 Opportunity to Cure Material Defaults
or Unsatisfied Conditions.

 

(a)                                  If
a party is in material default under this Global Agreement, then the other
party, upon obtaining knowledge of such default, shall provide, in accordance
with the terms hereof, written notice specifying in reasonable detail the
nature of such default, whereupon the party in default shall have the
applicable “Cure Period” to effect the cure of such default.

 

(b)                                 If
upon the scheduled Global Closing Date, any of the applicable conditions
precedent to the obligations of either ACC or TelCove set forth above in this Article V
shall not have been materially satisfied, and the party entitled to the benefit
of such condition is unwilling to waive the satisfaction of such unsatisfied
condition, then such party, upon the written request of the other party, shall
promptly provide the other party with written notice specifying in reasonable
detail the nature of such unsatisfied condition, whereupon the other party
shall have the applicable “Cure Period” to effect the satisfaction of such
unsatisfied condition, and the Global Closing shall be postponed until a
Business Day agreed to by the parties, which date shall be on or prior to the
earlier of (i) the fifth (5) Business Day after the end of the Cure
Period, or (ii) the “drop-dead” date specified in Section 6.1(c) below.  If each applicable condition to Global
Closing set forth above in this Article V is not satisfied (or waived in
writing by the party entitled to the benefit thereof) in all material respects
on the rescheduled Global Closing Date, then Global Closing may be again
postponed pursuant to the terms of this Section 5.4(b), provided, however, that
the Global Closing shall not be postponed to a date later than the “drop-dead”
date and if the Global Closing shall not have occurred prior to or on such
date, each party shall be entitled to exercise its rights under Section 6.1
with this Section 5.4 having no further effect.

 

29

 

(c)                                  The
applicable “Cure Period” shall be thirty (30) calendar days after such “curing”
party receives notice from the other party describing such material default or
unsatisfied condition, provided, however, that if such default or condition cannot reasonably
be cured within such thirty (30) day period, if the “curing” party shall
promptly commence such cure and shall thereafter diligently prosecute such cure
to completion, the period for curing such default or condition shall be
extended until the earlier of (i) the completion of such cure, or (ii) the
“drop-dead” date specified in Section 6.1(c) below.

 

(d)                                 Nothing
in this Global Agreement shall preclude either party hereto from seeking the
protection of the Bankruptcy Court to decide any claims or disputes that may
arise between ACC or TelCove regarding any of the conditions precedent to the
obligations of either ACC or TelCove set forth above in this Article V, or
any disputes between the parties regarding the satisfaction thereof.

 

ARTICLE VI.   TERMINATION

 

6.1                                 Termination of Global Agreement.  At any time prior to the Global Closing, this
Global Agreement may be terminated and the Global Transactions and the CLEC
Transactions contemplated hereby abandoned:

 

(a)                                  By
mutual written consent of ACC and TelCove;

 

(b)                                 By
either party, upon written notice to the other party, if the Bankruptcy Court
issues an Order denying the Settlement Motion and such Order is not appealed or
has been affirmed on appeal and has become a final and non-appealable; or

 

(c)                                  By
either party, upon written notice to the other party, if such terminating party
is not then in material default under this Global Agreement, if the Global
Closing has not occurred on or before March 1, 2005.

 

6.2                                 Consequences in Event of Termination.  In the event of any termination of this
Global Agreement prior to the consummation of the Global Closing, this Global
Agreement shall forthwith become wholly void and of no further force and
effect, and there shall be no liability on the part of either party, except
that:

 

(a)                                  The
obligations of ACC and TelCove under Section 4.12(d) (Expenses Relating to
Governmental Applications), Section 4.17(e) (Expenses Relating to
Consents), Article VIII (Confidentiality) and Article IX (Miscellaneous)
shall remain in full force and effect.

 

(b)                                 If
this Global Agreement is terminated on or after the “drop-dead” date specified
in Section 6.1(c) above, as a result of any material default under this
Global Agreement by either party (the “Defaulting Party”), the
Defaulting Party shall be liable to the other party for any costs, expenses or
damages incurred by the other party as a result of such default.

 

30

 

ARTICLE VII.   INDEMNIFICATION

 

7.1                                 Survival.  All representations and warranties of the
ACC Parties and the TelCove Parties contained in this Global Agreement, the
Annex Agreements, or in the certificates delivered pursuant to Section 5.2(c)
or 5.3(c), as the case may be, shall survive the Global Closing.  The covenants of the ACC Parties and the
TelCove Parties contained in this Global Agreement or the Annex Agreements
shall survive the Global Closing and any Effective Date in accordance with
their terms.

 

7.2                                 Indemnification.

 

(a)                                  Indemnification
by the ACC Parties.  Subject to
Sections 7.3, 7.4 and 7.5, following the Global Closing, the ACC Parties
shall indemnify and hold each of the TelCove Parties and their Representatives
harmless against and in respect of any loss, damage, claim, or liability, of
any nature or kind, including all costs and expenses relating thereto,
including interest, penalties and reasonable attorneys’ fees (collectively “Damages”),
arising out of, resulting from or relating to:

 

(i)                                     any
breach by any of the ACC Parties of its covenants set forth herein or in the IT
License Exchange Agreement, the A&A Agreement or the Conveyance Agreement;
or

 

(ii)                                  any
breach by any of the ACC Parties of its representations or warranties set forth
herein or in the IT License Exchange Agreement, the A&A Agreement, the Conveyance
Agreement or the certificate delivered by ACC pursuant to Section 5.3(c).

 

(b)                                 Indemnification
by the TelCove Parties.  Subject to
Sections 7.3, 7.4 and 7.5, following the Global Closing, the TelCove
Parties shall indemnify and hold each of the ACC Parties and their
Representatives harmless against and in respect of any Damages, arising out of,
resulting from or relating to:

 

(i)                                     any
breach by any of the TelCove Parties of its covenants set forth herein or in the
IT License Exchange Agreement, the A&A Agreement or the Conveyance
Agreement; or

 

(ii)                                  any
breach by any of the TelCove Parties of its representations or warranties set
forth herein or in the IT License Exchange Agreement, the A&A Agreement, the
Conveyance Agreement or the certificate delivered by TelCove pursuant to Section 5.2(c).

 

7.3                                 Procedures for Indemnification.

 

(a)                                  Any
Person (the “Indemnified Party”) may assert a claim for indemnification
under Section 7.2 (a) or (b), as the case may be, by providing written
notice (the “Notice”) to the party from which indemnification is sought
(the “Indemnifying Party”), stating the amount of Damages, if known, and
the nature and basis of such claim.

 

(b)                                 In
the case of Damages that arise or may arise by reason of any Third-Party claim,
promptly after receipt by an Indemnified Party of written notice of the
assertion of

 

31

 

any claim or the
commencement of any action with respect to any matter in respect of which indemnification
may be sought hereunder, the Indemnified Party shall give Notice to the
Indemnifying Party and shall thereafter keep the Indemnifying Party reasonably
informed with respect thereto, provided that failure of the Indemnified Party
to give the Indemnifying Party prompt notice as provided herein shall not
relieve the Indemnifying Party of any of its obligations hereunder, except to
the extent that the Indemnifying Party is materially prejudiced by such
failure.  In case any such claim is made
or action is brought against any Indemnified Party, the Indemnifying Party
shall be entitled to assume the defense thereof, by written notice to the
Indemnified Party within thirty (30) days after receipt of the Notice stating
its intent to do so and acknowledging its potential liability to the
Indemnified Party hereunder.  If the
Indemnifying Party assumes the defense of such claim or action, it shall have
the right to settle such claim or action; provided, however, that it shall not settle such claim or action
without the prior written consent of the Indemnified Party (which consent shall
not be unreasonably withheld or delayed) if such settlement (i) does not
include as an unconditional term thereof the giving by the claimant or the
plaintiff of a release of the Indemnified Party from all liability with respect
to such claim or action or (ii) involves the imposition of equitable
remedies or the imposition of any material obligations on such Indemnified
Party other than financial obligations for which such Indemnified Party will be
indemnified hereunder.  Following
delivery of notice of its intention to assume the defense of any claim or
action hereunder, the Indemnifying Party shall not be liable hereunder for any
legal or other expenses subsequently incurred by the Indemnified Party in
connection with the defense thereof; provided, however, that if the defendants in any action shall include
both an Indemnifying Party and any Indemnified Party and such Indemnified Party
shall have reasonably concluded that counsel selected by the Indemnifying Party
has a conflict of interest because of the availability of different or
additional defenses to such Indemnified Party, such Indemnified Party shall
have the right to separate counsel to participate in the defense of such action
on its behalf, at the expense of the Indemnifying Party; provided,
further, however,
that the Indemnifying Party shall not be obligated to pay the expenses of more
than one separate counsel for all Indemnified Parties, taken together.  If the Indemnifying Party chooses to assume
the defense of any claim or action pursuant hereto, the Indemnified Party shall
cooperate in such defense, which cooperation shall include the retention and
the provision to the Indemnifying Party of records and information which are
reasonably relevant to such defense, and making employees available on a
mutually convenient basis to provide additional information and explanation of
any materials provided hereunder, including providing such employees to serve
as witnesses.

 

(c)                                  If
the Indemnifying Party fails to notify the Indemnified Party of its desire to
assume the defense of any claim or action within the prescribed period of time,
or shall notify the Indemnified Party that it will not assume the defense
hereof, then the Indemnified Party may assume the defense of such claim or
action, in which event it may do so acting in good faith, and the Indemnifying
Party shall be bound by any determination made in any such action, provided, however, that
the Indemnified Party shall not be permitted to settle any such action without
the consent of the Indemnifying Party, which consent shall not be unreasonably
withheld or delayed.  No such
determination or settlement shall affect the right of the Indemnifying Party to
dispute the Indemnified Party’s claim for indemnification hereunder.  The Indemnifying Party shall be permitted to
participate in the defense of such claim or action and to employ counsel at its
own expense.

 

32

 

(d)                                 With
respect to claims solely between the parties, following receipt of notice from
the Indemnified Party of a claim, the Indemnifying Party shall have thirty (30)
days to make such investigation of the claim as the Indemnifying Party deems
necessary or desirable.  For the purposes
of such investigation, the Indemnified Party agrees to make available to the
Indemnifying Party and its authorized Representatives the information relied
upon by the Indemnified Party to substantiate the claim.  With respect to claims for Uncapped Damages,
if the Indemnified Party and the Indemnifying Party agree at or prior to the
expiration of the thirty-day period (or any mutually agreed upon extension
thereof) to the validity and amount of such claim, the Indemnifying Party shall
immediately pay to the Indemnified Party the agreed-to amount of such claim,
and if the Indemnified Party and the Indemnifying Party do not agree within
such thirty-day period (or any mutually agreed upon extension thereof), the
Indemnified Party may seek appropriate remedy, subject to the terms hereof.

 

7.4                                 Other
Provisions.

 

(a)                                  The
right to indemnification pursuant to this Article VII shall not be
affected by any investigation conducted with respect to, or any knowledge
acquired (or capable of being acquired) at any time, whether before or after
the execution and delivery of this Global Agreement or the Global Closing with
respect to the accuracy or inaccuracy of or compliance with, any
representation, warranty or covenant. 
The waiver of any condition to the obligation of a party to consummate
the Global Transactions or the CLEC Transactions, where such condition is based
on the accuracy of any representation or warranty, or on the performance of or
compliance with any covenant, shall not affect the right of either party to
indemnification or other remedy based on the breach of such representation,
warranty or covenant.

 

(b)                                 The
amount of Damages for which indemnification is payable under Section 7.2
shall be net of any amounts recovered by the Indemnified Party from any Third
Party other than an insurer (by contribution, indemnification or otherwise)
with respect to such Damages.

 

(c)                                  Uncapped
Damages suffered by any Indemnified Party shall accrue interest at the rate of
eight percent (8 %) per annum from the date such Uncapped Damages shall have
been incurred by such Indemnified Party until such Uncapped Damages shall be
paid by the appropriate Indemnifying Party. 
Capped Damages suffered by any Indemnified Party shall accrue interest
at the rate of eight percent (8 %) per annum from the latter of nine (9) months
after the TelCove Emergence or the date such Capped Damages shall be suffered
by the Indemnified Party until such Capped Damages shall be paid by the
appropriate Indemnifying Party. 

 

(d)                                 Subject
to Section 9.11, following the final Effective Date, the sole and
exclusive remedy for either party for any claim arising out of this Global
Agreement (excluding from the meaning thereof the Annexes hereto), the IT
License Exchange Agreement, the A&A Agreement and the Conveyance Agreement shall
be a claim for indemnification pursuant to this Article VII. Any claim arising
out of the Mutual Release, the Commercial Services Agreement, the IP Transport
Agreement, the IRU Agreement, the Maintenance Agreement, the Collocation
Agreement and the Master Management Agreement shall be governed by the
indemnification

 

33

 

provisions of the
applicable agreement.  Any claim arising
out of the MSA Amendment shall be governed by the Master Agreement.

 

7.5                                 Limitations on
Indemnification for Capped Damages.

 

(a)                                  The
ACC Parties shall not be required to indemnify or otherwise be liable to the
TelCove Parties, nor shall the TelCove Parties be required to indemnify or
otherwise be liable to the ACC Parties, for the net amount of Capped Damages
except to the extent the net amount of Capped Damages suffered or incurred by
the TelCove Parties or the ACC Parties, as the case may be, as determined
pursuant to the provisions of Section 7.6, exceed in the aggregate
$100,000 (which amount thus comprises a “deductible”).

 

(b)                                 The
ACC Parties shall not be required to indemnify or otherwise be liable to the
TelCove Parties, nor shall the TelCove Parties be required to indemnify or
otherwise be liable to the ACC Parties, for the net amount of Capped Damages
suffered or incurred by the TelCove Parties or the ACC Parties, as the case may
be, as determined pursuant to the provisions of Section 7.6, in excess of
an aggregate of $5,000,000.  The Parties
acknowledge that the foregoing cap may be adjusted pursuant to a written
agreement executed by both parties as part of any overall settlement of the
other disputes between the parties that are not being addressed by this Global Agreement.

 

(c)                                  The
ACC Parties shall not be required to indemnify or otherwise be liable to the
TelCove Parties, nor shall the TelCove Parties be required to indemnify or
otherwise be liable to the ACC Parties with respect to a claim for Capped
Damages unless notice by the Indemnified Party to the Indemnifying Party of the
claim for Capped Damages is given within nine (9) months after the TelCove Emergence (including
the first Business Day thereafter if the last day of such nine-month period is
not a Business Day), provided, however, any claim for Capped Damages by any Person with
respect to a breach of Section 4.11(a), must be made no later than the
sixtieth (60th) day after the TelCove Emergence.

 

(d)                                 Neither
party shall have any obligation to pay the other party any Capped Damages until
the net amount of such Capped Damages shall be determined in accordance with
the provisions of Section 7.6.

 

(e)                                  No
party shall claim or assert that the limitations set forth in
subsections (a) through (d) above shall apply, and such limitations shall not
apply, with respect to the payment or discharge of Uncapped Damages, including
any taxes, fees or expenses payable by either the ACC Parties, the TelCove
Parties or their Affiliates under Section 4.5(a), 4.6, 4.12(d), 4.17(e) or
9.1.

 

7.6                                 Determination of
Capped Damages.

 

(a)                                  At
three meetings that shall be held between ACC and TelCove on mutually agreed to
dates within the five (5) Business Day period following three (3) months, six
(6) months and nine (9) months
after the TelCove Emergence, ACC and TelCove shall exchange information
regarding, and discuss, all claims for indemnification for Capped Damages that
either party or its Affiliates shall have with respect to the other party or
its Affiliates in accordance with the terms of Sections 7.2 through
7.4.  Such information shall include the

 

34

 

amount of Capped Damages,
if known, with respect to each such claim and the nature and basis of such
claim.  At such meetings and in follow-up
thereto, ACC and TelCove shall in good faith attempt to reach agreement with
respect to the amount of Capped Damages payable with respect to each such
claim, and to maintain an ongoing accounting of the amount of Capped Damages
owed by each party and its Affiliates to the other party and its Affiliates.

 

(b)                                 Subsequent
to each meeting, each party shall provide the other with all appropriate
supporting information and documentation reasonably requested by the other
party with respect to any claims for Capped Damages by the first party.

 

(c)                                  At,
or in prompt follow-up to, the third meeting, ACC and TelCove shall in good
faith attempt to reach agreement regarding the net amount of Capped Damages
suffered or incurred by the TelCove Parties or the ACC Parties, as the case may
be, with respect to all paid and unpaid claims for Capped Damages by either
party or its Affiliates for indemnity in accordance with the provisions of
Sections 7.2 through 7.4, taking into consideration the limitations set
forth in Section 7.5.  Within ten
(10) business days after any agreement between ACC and TelCove regarding the
net amount of Capped Damages, the party owing such net amount shall pay the
other party such net amount by federal wire transfer of immediately available
funds pursuant to wire instructions that shall be provided by such other party.

 

(d)                                 If
ACC and TelCove do not reach agreement within ten (10) months of the TelCove
Emergence to the net amount of Capped Damages to be paid by one party to the
other party, then at any time thereafter either party may petition the
Bankruptcy Court for whatever redress its shall claim to be appropriate under
the terms of this Agreement.

 

ARTICLE VIII.   CONFIDENTIALITY

 

8.1                                 If
either party provides confidential information to the other party in connection
with this Global Agreement in writing and identified as such, the receiving
party shall protect the confidential information from disclosure to third
parties with the same degree of care accorded its own confidential and
proprietary information; provided, however, that each party shall be entitled to provide such
confidential information to its directors, officers, employees, agents, and
contractors, consultants, Affiliates, financial institutions, underlying
facility owners, and potential assignees, in each case whose access is
reasonably necessary.  A party furnishing
confidential information of the other party to any other Person shall inform
such Person of its confidential nature and shall direct such Person to treat
such information confidentially. In any event, each party shall be liable for
any disclosure or wrongful use of another party’s confidential information by
any Person to whom such party discloses it. 
Notwithstanding any other provision herein, neither party shall be
required to hold confidential any information that: (i) becomes publicly
available other than through action by such party or any Person to whom such
party furnished such information; or (ii) is required to be disclosed by
applicable Law, Order of a Governmental Entity or Proceedings or a party’s
obligations as a publicly held company. 
These obligations shall survive expiration or termination of this Global
Agreement for a period of two (2) years.

 

8.2                                 Except
as provided in Section 4.5(b) with respect to the provision of information
to taxing authorities, a party required to disclose confidential information of
the other party

 

35

 

pursuant to applicable
Law, Order of a Governmental Entity or Proceedings or a party’s obligations as
a publicly held company shall notify the other party in writing of the
information that the party intends to disclose sufficiently in advance to allow
time for the other party to object.

 

ARTICLE IX.   MISCELLANEOUS

 

9.1                                 Expenses.  Except as set forth in this Global Agreement or
any Annex Agreement, and whether or not the transactions contemplated hereby
are consummated, each party shall bear all costs and expenses incurred or to be
incurred by such party in connection with this Global Agreement and the Annex
Agreements, and the consummation of the transactions contemplated hereby.

 

9.2                                 Assignment.  Neither this Global Agreement nor any of the
rights or obligations hereunder may be assigned by ACC or any other ACC Party
without the prior written consent of TelCove (which shall not be unreasonably
withheld), or by TelCove or any other TelCove Party without the prior written
consent of ACC (which shall not be unreasonably withheld); provided,
however, that either party may assign
its rights and obligations hereunder, in whole or in part, to any Affiliate but
no such assignment shall relieve either party of its liabilities and
obligations hereunder, and provided, further, that this Global Agreement may be assigned to one
or more trustees appointed by the Bankruptcy Court to succeed to the rights of
either party.  Nothing in the preceding
sentence prohibits the assignment of a party’s rights under any of the Global
Annex Agreements in accordance with its terms subsequent to the Global Closing
or any of the CLEC Annex Agreements in accordance with its terms subsequent to the
Global Closing.  Subject to the
foregoing, this Global Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns, and except
as otherwise expressly provided herein, no other Person shall have any right,
benefit or obligation hereunder.

 

9.3                                 Parties in Interest.  This Global Agreement shall be binding upon
and inure solely to the benefit of ACC and the other ACC Parties, and TelCove
and the other TelCove Parties, and nothing in these Agreements, express or
implied, is intended to or shall confer upon any other person any rights,
benefits or remedies of any nature whatsoever under or by reason of this Global
Agreement (other than those Persons entitled to indemnification pursuant to Article VII).  Without limiting the foregoing, no direct or
indirect holder of any equity interests or securities of either ACC or TelCove
(whether such holder is a limited or general partner, member, stockholder or
otherwise), nor any Affiliate of either ACC or TelCove that is not an ACC Party
or a TelCove Party, nor any director, officer, employee, representative, agent
or other controlling person of each of the parties hereto and their respective
Affiliates shall have any liability or obligation arising under this Global
Agreement or the transactions contemplated thereby.

 

9.4                                 Notices.  Unless otherwise provided herein, any notice,
request, instruction or other document to be given hereunder by any party to any
other party shall be in writing and shall be delivered in person or by courier
or facsimile transmission (with such facsimile transmission confirmed by
sending a copy of such notice, request, instruction or other document by
certified mail, return receipt requested) or mailed by certified mail, postage
prepaid, return receipt requested (such mailed notice to be effective on the
date such receipt is acknowledged), as follows:

 

36

 

	
  If to TelCove:

  	
   

  	
  TelCove

  121 Champion Way

  Canonsburg, PA 15317 Attn.: John Glicksman, Vice President and General
  Counsel

  Fax: (724) 743-9403

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Weil, Gotshal & Manges LLP

  767 Fifth Avenue

  New York, New York 10153

  Attn.: Judy G. Z. Liu, Esq.

  Fax: (212) 310-8007

  
	
   

  	
   

  	
   

  
	
  and:

  	
   

  	
  TelCove

  121 Champion Way

  Canonsburg, PA 15317

  Attn.: Robert Guth, President/CEO

  Fax: (724) 743-9791

  
	
   

  	
   

  	
   

  
	
  If to ACC:

  	
   

  	
  Adelphia Communications Corp.

  5619 DTC Parkway

  Denver, CO 80111

  Attn.: General Counsel

  Fax: (303) 268-6485

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Willkie Farr & Gallagher LLP

  787 Seventh Avenue

  New York, NY 10019-6099

  Attn.: Brian E. O’Connor, Esq.

  Fax: (212) 728-8111

  
	
   

  	
   

  	
   

  
	
  and:

  	
   

  	
  Dow, Lohnes & Albertson, PLLC

  1200 New Hampshire Avenue, NW

  Washington, DC 20036

  Attn.: John H. Pomeroy, Esq.

  Fax: (202) 776-2222

  

 

or to such other place and with such other copies as
either party may designate as to itself by written notice to the other
party.  Rejection, any refusal to accept
or the inability to deliver because of changed address of which no notice was
given shall be deemed to be receipt of the notice as of the date of such
rejection, refusal or inability to deliver.

 

9.5                                 Choice
of Law.  This Global Agreement
and the Annex Agreements are to be governed by and construed in accordance with
the Bankruptcy Code, to the extent applicable, and otherwise in accordance with
the domestic laws of the Commonwealth of Pennsylvania without reference to its
choice of law principles.

 

37

 

9.6                                 Entire Agreement; Amendments and Waivers.  This Global Agreement, the Exhibits, the
Annexes and the Schedules constitutes the entire agreement between the parties
pertaining to the subject matter hereof and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties, and the Exhibits, Annexes and Schedules are a part of this Global
Agreement as if fully set forth herein. 
Except as set forth herein or in any certificate delivered pursuant
hereto, no party makes any representation or warranty, express or implied, to
the other party with respect to this Global Agreement or the transactions
contemplated hereby.  No amendment or modification
of this Global Agreement (including any Exhibit, Annex or Schedule) shall be
binding unless the same is executed in writing by both parties.  No waiver of the benefit of any of the
provisions of this Global Agreement (including any Exhibit, Annex or Schedule)
shall be effective unless the same is executed in writing by the party against
whom enforcement is sought.  No waiver of
any of the provisions of this Global Agreement shall be deemed or shall
constitute a waiver of any other provision hereof (whether or not similar), and
no such waiver shall constitute a continuing waiver unless otherwise expressly
provided.

 

9.7                                 Invalidity.  If any one or more of the provisions
contained in this Global Agreement or in any other instrument referred to
herein, shall for any reason be held to be invalid, illegal or unenforceable in
any respect, the parties shall negotiate in good faith to modify this Global
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that the transactions contemplated
hereby are fulfilled to the greatest extent possible.

 

9.8                                 Headings.
 The table of contents and the
headings of the Articles and Sections herein are inserted for convenience of
reference only and are not intended to be a part of, or to affect the meaning
or interpretation of, this Global Agreement.

 

9.9                                 Exclusive Jurisdiction.  Without limiting any party’s right to appeal
any Order of the Bankruptcy Court, (a) the Bankruptcy Court shall retain
exclusive jurisdiction to enforce the terms of this Global Agreement and the
Annexes and to decide any claims or disputes which may arise or result from, or
be connected with, this Global Agreement and the Annexes, any breach or default
hereunder or thereunder, or the transactions contemplated hereby or thereby,
and (b) any and all claims, actions, causes of action, suits and Proceedings
related to the foregoing shall be filed and maintained only in the Bankruptcy
Court, and the parties hereby consent to and submit to the personal and subject
matter jurisdiction and venue of the Bankruptcy Court and shall receive notices
at such locations as indicated in Section 9.4 hereof, provided,
however, that the foregoing shall apply
with respect to the Mutual Release, the Commercial Services Agreement, the IP
Transport Agreement, the IRU Agreement, the Maintenance Agreement and the
Collocation Agreement only until such time as the ACC Cases and the TelCove Cases
shall both be closed, at which time such jurisdiction shall be non-exclusive.

 

9.10                           Waiver
of Right to Trial by Jury. 
Each party to this Global Agreement waives any right to trial by jury in
any Proceeding regarding this Global Agreement or any provision hereof.

 

9.11                           Specific
Performance.  Each of the
parties hereto acknowledges that the other party hereto would be irreparably
damaged if this Global Agreement or any of the Annex

 

38

 

Agreements were not
performed in accordance with its specific terms or were otherwise
breached.  Accordingly, each of the
parties hereto shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this Global Agreement or any of the Annex
Agreements and to enforce specifically this Global Agreement or any of the
Annex Agreements in any action instituted in any court of the United States or
any state thereof having subject matter jurisdiction, in addition to any other
remedy to which the parties may be entitled, at law, in equity or pursuant to
this Global Agreement or any of the Annex Agreements.

 

9.12                           Counting.  If the due date for any action to be
taken under this Global Agreement (including the delivery of notices) is not a
Business Day, then such action shall be considered timely taken if performed on
or prior to the next Business Day following such due date.

 

9.13                           Service
of Process.  Each party
irrevocably consents to the service of process in any action or proceeding by
receipt of mailed copies thereof by national courier service or certified
United States mail, postage prepaid, return receipt requested, to its address
as specified in or pursuant to Section 9.4 hereof.  However, the foregoing shall not limit the
right of a party to effect service of process on the other party by any other
legally available method.

 

9.14                           Time of Essence.  With regard to all dates and time periods set
forth or referred to in this Global Agreement, time is of the essence.

 

9.15                           Interpretation.

 

(a)                                  In
the event of any conflict between this Global Agreement and any of the Annex
Agreements, the provisions of such Annex Agreement shall govern.

 

(b)                                 Any
reference herein to any section of this Global Agreement shall be deemed
to include a reference to any Exhibit, Annex or Schedule referred to
within such section.

 

(c)                                  A
reference to any legislation or to any provision of any legislation shall
include any modification or re-enactment thereof, any legislative provision
substituted therefor and all regulations and statutory instruments issued
thereunder or pursuant thereto.

 

(d)                                 All
references to “$” and dollars shall refer to United States currency.

 

(e)                                  All
references to any financial or accounting terms shall be defined in accordance
with United States Generally Accepted Accounting Principles.

 

9.16                           Preparation of this Global Agreement.  ACC and TelCove hereby acknowledge that
(i) both parties jointly and equally participated in the drafting of this
Global Agreement, its Annex Agreements, and all other agreements contemplated
hereby, (ii) both parties have been adequately represented and advised by
legal counsel with respect to this Global Agreement, its Annex Agreements, and
the transactions contemplated hereby, and (iii) no presumption shall be
made that any provision of this Global Agreement or any agreement contemplated
hereby shall be construed against either party by reason of such role in the
drafting of this Global Agreement or any agreement contemplated hereby.

 

39

 

9.17                           Counterparts.  This Global Agreement may be executed in two
counterparts, each of which shall be deemed an original, but both of which
together shall constitute one and the same instrument.  Delivery of an executed counterpart of a
signature page to this Global Agreement by telecopy shall be as effective as
delivery of a manually executed counterpart of this Global Agreement.  In proving this Global Agreement, it shall
not be necessary to produce or account for more than one such counterpart
signed by the party against whom enforcement is sought.

 

[Remainder of Page Intentionally
Left Blank]

 

40

 

IN
WITNESS WHEREOF, this Global Agreement has been duly executed and delivered by
the duly authorized officers of ACC and TelCove as of the date first above
written.

 

	
  ACC:

  	
   

  	
  TELCOVE:

  
	
   

  	
   

  	
   

  
	
  ADELPHIA COMMUNICATIONS
  CORPORATION

  	
   

  	
  ADELPHIA BUSINESS SOLUTIONS, INC., d/b/a

  TelCove

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/

  	
  Joe W. Bagan

  	
   

  	
   

  	
  By:

  	
  /s/

  	
  John Glicksman

  	
   

  
	
  Name:

  	
  Joe W. Bagan

  	
   

  	
  Name:

  	
  John Glicksman

  
	
  Title:

  	
  Senior Vice President
  & Chief

  Administrative Officer

  	
   

  	
  Title:

  	
  Vice President and
  General Counsel

  
									

 

41

 

EXHIBITS

 

	
  Exhibit 2.1

  	
  –

  	
   

  	
  Payables Paid by ACC
  upon the Global Closing

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(a)

  	
  –

  	
   

  	
  Joint Rejections

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(b)

  	
  –

  	
   

  	
  ILEC Contracts

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(c)

  	
  –

  	
   

  	
  TelCove Assumed and
  Assigned to ACC

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(d)

  	
  –

  	
   

  	
  TelCove Assumed

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(e)

  	
  –

  	
   

  	
  TelCove Rejections

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(f)

  	
  –

  	
   

  	
  VA Ring Contracts

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(g)

  	
  –

  	
   

  	
  Omnibus Objection
  Contracts

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 2.5(h)

  	
  –

  	
   

  	
  ACC Contracts to be
  Assigned to TelCove

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 3.5A

  	
  –

  	
   

  	
  ACC Third-Party
  Consents

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 3.5B

  	
  –

  	
   

  	
  TelCove Third-Party
  Consents

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 3.8(a)(ii)

  	
  –

  	
   

  	
  Description of Garage

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 3.8(a)(iii)

  	
  –

  	
   

  	
  List of Motor Vehicles

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit 3.9

  	
  –

  	
   

  	
  ACC Retained Employees

  
	
   

  	
   

  	
   

  	
   

  
	
  ANNEXES

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex I

  	
  –

  	
   

  	
  Mutual
  Release Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  II

  	
  –

  	
   

  	
  Commercial
  Services Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  III

  	
  –

  	
   

  	
  IP
  Transport Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  IV

  	
  –

  	
   

  	
  IT
  License Exchange Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  V

  	
  –

  	
   

  	
  Assignment
  and Assumption Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  VI

  	
  –

  	
   

  	
  Amendment
  to Master Reciprocal Settlement Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  VII

  	
  –

  	
   

  	
  Asset
  Conveyance Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  VIII

  	
  –

  	
   

  	
  IRU
  Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  IX

  	
  –

  	
   

  	
  Maintenance
  Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  X

  	
  –

  	
   

  	
  Collocation
  Agreement

  
	
   

  	
   

  	
   

  	
   

  
	
  Annex
  XI

  	
  –

  	
   

  	
  Master
  Management Agreement

  

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I.

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Defined Terms

  	
   

  
	
  1.2

  	
  Other Defined Terms

  	
   

  
	
  1.3

  	
  Other Definitional
  Provisions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II.

  	
  TERMS OF SETTLEMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  The Global Transactions

  	
   

  
	
  2.2

  	
  The CLEC Transactions

  	
   

  
	
  2.3

  	
  Consideration

  	
   

  
	
  2.4

  	
  Global Closing and
  Subsequent Confirmations

  	
   

  
	
  2.5

  	
  Assumed and Non-Assumed
  Liabilities

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III.

  	
  REPRESENTATIONS AND
  WARRANTIES OF THE PARTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Existence, Good
  Standing and Power

  	
   

  
	
  3.2

  	
  Authority

  	
   

  
	
  3.3

  	
  Execution and Binding
  Effect

  	
   

  
	
  3.4

  	
  No Violation

  	
   

  
	
  3.5

  	
  Third-Party Consents

  	
   

  
	
  3.6

  	
  Brokers and Finders

  	
   

  
	
  3.7

  	
  Litigation

  	
   

  
	
  3.8

  	
  Title to Assets

  	
   

  
	
  3.9

  	
  Employees

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV.

  	
  COVENANTS OF THE
  PARTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Public Announcements

  	
   

  
	
  4.2

  	
  Reasonable Efforts

  	
   

  
	
  4.3

  	
  Notification of Certain
  Matters

  	
   

  
	
  4.4

  	
  Further Agreements

  	
   

  
	
  4.5

  	
  Payment of Transfer
  Taxes; Tax Filings

  	
   

  
	
  4.6

  	
  Proration of Taxes,
  Refunds and Certain Charges

  	
   

  
	
  4.7

  	
  HSR Act

  	
   

  
	
  4.8

  	
  Bulk Sales

  	
   

  
	
  4.9

  	
  Settlement Motion.

  	
   

  
	
  4.10

  	
  Disclosure Exhibits and
  Schedules

  	
   

  
	
  4.11

  	
  Inspection and
  Maintenance of Acquired Assets and Related Records

  	
   

  
	
  4.12

  	
  FCC, State and Other
  Governmental Applications

  	
   

  
	
  4.13

  	
  Lien Searches

  	
   

  
	
  4.14

  	
  Taxes

  	
   

  
	
  4.15

  	
  Compliance with
  Contracts and Operation of Business

  	
   

  
	
  4.16

  	
  Execution by ACC and
  TelCove on behalf of Affiliates

  	
   

  
	
  4.17

  	
  Consents

  	
   

  
	
  4.18

  	
  No Continuation of
  Business

  	
   

  

 

i

 

	
  4.19

  	
  Employee Matters

  	
   

  
	
  4.20

  	
  Removal of Adelphia
  Marks

  	
   

  
	
  4.21

  	
  Use of “Adelphia
  Business Solutions”

  	
   

  
	
  4.22

  	
  Real Estate
  Transactions

  	
   

  
	
  4.23

  	
  Access to Records and
  Personnel; Cooperation re Third-Party Claims

  	
   

  
	
  4.24

  	
  Cooperation regarding
  Bankruptcy

  	
   

  
	
  4.25

  	
  Payment of Current
  Invoices

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V.

  	
  CONDITIONS TO
  OBLIGATIONS OF THE PARTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Conditions Precedent to
  Obligations of the Parties

  	
   

  
	
  5.2

  	
  Conditions Precedent to
  Obligations of ACC

  	
   

  
	
  5.3

  	
  Conditions Precedent to
  Obligations of TelCove

  	
   

  
	
  5.4

  	
  Opportunity to Cure
  Material Defaults or Unsatisfied Conditions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI.

  	
  TERMINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Termination of Global
  Agreement

  	
   

  
	
  6.2

  	
  Consequences in Event
  of Termination

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII.

  	
  INDEMNIFICATION

  	
   

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Survival

  	
   

  
	
  7.2

  	
  Indemnification

  	
   

  
	
  7.3

  	
  Procedures for
  Indemnification

  	
   

  
	
  7.4

  	
  Other Provisions

  	
   

  
	
  7.5

  	
  Limitations on
  Indemnification for Capped Damages

  	
   

  
	
  7.6

  	
  Determination of Capped
  Damages.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII.

  	
  CONFIDENTIALITY

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX.

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  9.1

  	
  Expenses

  	
   

  
	
  9.2

  	
  Assignment

  	
   

  
	
  9.3

  	
  Parties in Interest

  	
   

  
	
  9.4

  	
  Notices

  	
   

  
	
  9.5

  	
  Choice of Law

  	
   

  
	
  9.6

  	
  Entire Agreement;
  Amendments and Waivers

  	
   

  
	
  9.7

  	
  Invalidity

  	
   

  
	
  9.8

  	
  Headings

  	
   

  
	
  9.9

  	
  Exclusive Jurisdiction

  	
   

  
	
  9.10

  	
  Waiver of Right to
  Trial by Jury

  	
   

  
	
  9.11

  	
  Specific Performance

  	
   

  
	
  9.12

  	
  Counting

  	
   

  
	
  9.13

  	
  Service of Process

  	
   

  
	
  9.14

  	
  Time of Essence

  	
   

  

 

ii

 

	
  9.15

  	
  Interpretation

  	
   

  
	
  9.16

  	
  Preparation of this
  Global Agreement

  	
   

  
	
  9.17

  	
  Counterparts

  	
   

  

 

iiiExhibit 10.04.2

 

MUTUAL RELEASE AGREEMENT

 

This Mutual Release Agreement is dated as of April       ,
2004 (the “Agreement”), by and between Adelphia Communications Corporation, a
Delaware corporation (“ACC”), debtor-in-possession, and its Affiliates,
other than any Rigas Person (as defined below) (together with ACC, the “ACC
Parties” and each, individually, an “ACC Party”), and Adelphia
Business Solutions, Inc., a Delaware corporation, d/b/a
TelCove (“TelCove”), debtor-in-possession, and its Affiliates, other
than any Rigas Person (together with TelCove, the “TelCove Parties” and
each, individually, a “TelCove Party”).

 

W  I  T  N  E  S  S
E  T  H:

 

WHEREAS, TelCove and certain of its direct and
indirect subsidiaries, commenced cases (the “TelCove Cases”) under chapter 11
of title 11 of the United States Code, 11 U.S.C. Sections 101 et seq.
(the “Bankruptcy Code”) on March 27, 2002, and June 18, 2002,
by filing voluntary petitions with the United States Bankruptcy Court for the
Southern District of New York (the “Bankruptcy Court”), jointly
administered under Case No. 02-11389; and

 

WHEREAS, ACC and certain of its direct and indirect
subsidiaries commenced cases (the “ACC Cases”) under chapter 11 of the
Bankruptcy Code on June 10, 2002, and June 25, 2002, by filing voluntary
petitions with the Bankruptcy Court, jointly administered under Case No.
02-41729 (REG); and

 

WHEREAS, ACC and TelCove are parties to that certain
Master Reciprocal Settlement Agreement (together with all Exhibits, Annexes and
Schedules thereto) dated as of December 3, 2003 (the “Master Agreement”),
which validates and memorializes the ownership of various assets, including
long-haul and metro fiber-optic cable assets, real property interests,
equipment, strands and network infrastructure between ACC and TelCove; and

 

WHEREAS, TelCove and ACC each have certain remaining
unresolved claims, defenses and counterclaims against each other; and

 

WHEREAS, TelCove and ACC each deny the validity of
each other’s respective claims, defenses and counterclaims; and

 

WHEREAS, TelCove and ACC have negotiated a
comprehensive Global Settlement Agreement dated as of February 21, 2004
(the “Global Agreement”), which provides for the resolution or settlement of
virtually all outstanding issues and claims remaining between the parties; and

 

WHEREAS, in connection with the consummation of the
Global Agreement on the date hereof, TelCove and ACC each desire to enter into
a full and complete settlement with each other, which shall, upon the
fulfillment of certain conditions precedent, result in the full and final
release and waiver of all claims and counterclaims, except as otherwise
provided herein, as well as any other unasserted or potential claims; and

 

NOW, THEREFORE, in consideration of the mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of

 

 

which are hereby
acknowledged, and subject to the terms and conditions hereof, the parties,
intending to be legally bound, hereby agree as follows:

 

1.                                       Effective
as of the date hereof, except to enforce the terms of the Global Agreement and
each of the Annexes and Schedules thereto, and the Master Agreement, and each
of the Exhibits and Annexes thereto, each of the ACC Parties and their
successors, assigns and Affiliates, hereby release the TelCove Parties and
their successors, assigns, Affiliates, agents, attorneys, employees, general
partners, limited partners, officers and directors, other than any Rigas Person
(the “TelCove Releasees”) from any and all liabilities, claims (as defined in section 101(5)
of the Bankruptcy Code), actions, causes of action, suits, debts, accounts,
damages, injuries or demands of whatever kind or nature, including any claims
for attorneys’ fees and costs (collectively, “Claims”) which any of them had,
now have, or may have against the TelCove Releasees, whether fixed, liquidated
or contingent, whether arising in law or at equity, whether known or unknown,
whether accrued or to accrue, whether asserted by way of claim, counterclaim,
cross-claim, action for indemnity, contribution or otherwise that any ACC Party
is entitled to assert in its own right or on behalf of the holder of any claim
or equity interest or other person, based in whole or in part upon any act or
omission, transaction, agreement, event or other occurrence taking place at any
time since the beginning of time and through the date hereof, and in any way
relating to any TelCove Releasees and/or the TelCove Cases, provided, however,
that this release shall not be construed to release any claims relative to the
allocation of D&O insurance coverage between TelCove and ACC.

 

2.                                       Effective as of the date
hereof, except to enforce the terms of the Global Agreement and each of the
Annexes and Schedules thereto, and the Master Agreement and each of the
Exhibits and Annexes thereto, each of the TelCove Parties and their successors,
assigns and Affiliates hereby release the ACC Parties and their successors,
assigns, Affiliates, agents, attorneys, employees, general partners, limited
partners, officers and directors, other than any Rigas Person (the “ACC
Releasees”) from any and all Claims which any of them had, now has, or may have
against the ACC Releasees, whether fixed, liquidated or contingent, whether
arising in law or at equity, whether known or unknown, whether accrued or to
accrue, whether asserted by way of claim, counterclaim, cross-claim, action for
indemnity, contribution or otherwise that any TelCove Party is entitled to
assert in its own right or on behalf of the holder of any claim or equity
interest or other person, based in whole or in part upon any act or omission,
transaction, agreement, event or other occurrence taking place at any time
since the beginning of time and through the date hereof, and in any way relating
to any ACC Releasees, and/or the ACC Cases, 
provided, however, that this release shall not be construed to release
any claims relative to the allocation of D&O insurance coverage between
TelCove and ACC.

 

3.                                       Capitalized terms used but not
defined herein shall have the meaning ascribed to such terms in the Global
Agreement.

 

4.                                       This Agreement may only be
modified or supplemented by an instrument in writing executed by duly
authorized representatives of the Parties.

 

5.                                       This Agreement shall constitute
the complete, final, and exclusive statement of the terms regarding the subject
matter hereof, and shall supersede all prior or

 

2

 

contemporaneous written
or oral representations, understandings, and communications relating
thereto.  The terms and conditions of
this Agreement shall not be varied, supplemented, waived, qualified, modified,
or interpreted by any prior or subsequent course of dealing between the
parties, failure, or delay to enforce any rights hereunder, or by any usage of
trade or manner other than by a subsequent writing signed by authorized
representatives of both Parties.

 

6.                                       The Bankruptcy Court shall
retain exclusive jurisdiction to enforce the terms of this Agreement and to
decide any claims or disputes which may arise or result from, or be connected
with, this Agreement during the pendency of the TelCove Cases and the ACC
Cases.

 

7.                                       This Agreement has been fully
negotiated between and jointly drafted by the Parties.

 

8.                                       This Agreement shall not be
construed as a release of any Rigas Person, in such Person’s capacity as an
Affiliate, or otherwise, from any Claims. 
For purposes of this Agreement, the term “Rigas Person” shall be defined
to mean: Doris Rigas, James Rigas, John Rigas, Michael Rigas, Timothy Rigas,
Ellen Rigas Venetis, Peter Venetis, James Brown, Colin Higgin, Michael
Mulcahey, Timothy Werth, Dorellenic Cable Partners, Highland 2000, LLC,
Highland 2000, LP, Highland Communications, LLC, Highland Holdings II, GP,
Highland Holdings, GP, Highland Preferred Communications 2001, LLC, Iliad
Holdings, Inc., NCAA Holdings, Inc., Doris Holdings, L.P., Highland Pref.
Communications, LLC, Coudersport Television Cable Company, Coudersport Theatre,
Debaire Designs, Eleni Interiors, Inc., Ergoarts, Inc., Highland Prestige
Georgia, Inc., Highland Video Associates, LP, Hilton Head Communications, LP,
Niagara Frontier Hockey, LP, Songcatcher Films, LLC, Wending Creek 3656, LLC,
Wending Creek Farms, Inc., Rigas Entertainment, Ltd., Island Partners, Inc.,
Roumali, Inc., Gristmill Properties, Inc., Syracuse-Hilton Head Holdings, LP
and any individual, corporation, partnership, limited liability company,
association, trust, joint venture, unincorporated organization or other entity
Controlled (as defined below) by a Rigas Person, and any of their collective
successors, assigns, transferees, or heirs. 
For purposes of this provision, the term “Control” shall mean the
possession, direct or indirect, of the power to direct or cause the direction
of the management and policies of a Rigas Person, whether through the ownership
of stock, as trustee or executor, by contract or credit arrangement or
otherwise.

 

9.                                       This Agreement may be executed
in two or more counterparts, all of which taken together shall constitute one
and the same instrument.

 

[Remainder of Page Intentionally Left Blank]

 

3

 

IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed by their respective authorized representatives.

 

	
  ACC
  PARTIES:

  	
   

  	
  TELCOVE
  PARTIES:

  
	
   

  	
   

  	
   

  
	
  ADELPHIA
  COMMUNICATIONS CORPORATION

  	
   

  	
  ADELPHIA BUSINESS
  SOLUTIONS, INC., d/b/a

  TELCOVE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Joe W. Bagan

  	
   

  	
   

  	
  By:

  	
  /s/ Robert E. Guth

  	
   

  
	
   

  	
  Joe W. Bagan, Senior Vice President &

  Chief Administrative Officer

  	
   

  	
   

  	
   

  	
  Robert E. Guth, President & Chief

  Executive Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EACH OF THE ACC PARTIES LISTED ON

  SCHEDULE A HERETO

  	
   

  	
  EACH OF THE TELCOVE PARTIES LISTED ON

  SCHEDULE B HERETO

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Joe W. Bagan

  	
   

  	
   

  	
  By:

  	
  /s/ Robert E. Guth

  	
   

  
	
   

  	
  Joe W. Bagan, Senior Vice President &

  Chief Administrative Officer

  	
   

  	
   

  	
   

  	
  Robert E. Guth, President & Chief

  Executive Officer

  	
   

  

 

4

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