Document:

Agreement Between The Blackstone Group L.P. and RCN Corporation

 Exhibit 10.20 
  
 

 
  
 March 9, 2004 
  
 Mr. David C. McCourt 
 Chairman and Chief Executive Officer 
 RCN Corporation 
 105 Carnegie Center 
 Princeton, NJ 08540 
  
 Dear David: 
  
 This letter confirms the understanding and agreement (the “Agreement”) between The Blackstone Group L.P. (“Blackstone”) and RCN
Corporation (together with any affiliates and subsidiaries, the “Company”) regarding the retention of Blackstone by the Company effective as of March 9, 2004 (the “Effective Date”) as its financial advisor for the purposes set
forth herein. 
  
 Under this Agreement, Blackstone will provide
financial advisory services to the Company in connection with a possible restructuring of certain or all liabilities of the Company and the (i) sale, merger or other disposition of all or a portion of the Company or its assets; or (ii)
arranging of debt or equity capital (collectively, a “Transaction”), and will assist the Company in analyzing, structuring, negotiating and effecting the Restructuring or Transaction pursuant to the terms and conditions of this Agreement.
As used in this Agreement, the term Restructuring shall mean, collectively, (i) any restructuring, reorganization (whether or not pursuant to Chapter 11 of the United States Bankruptcy Code) and/or recapitalization of the Company affecting existing
or potential debt obligations or other claims, including, without limitation, senior debt, junior debt, trade claims and general unsecured claims (collectively, the “Obligations”), and/or (ii) any complete or partial repurchase,
refinancing, extension or repayment by the Company of any of the Obligations. 
  
 The financial advisory services to be rendered by Blackstone will include the following: 
  

	 	(a)	Assist in the evaluation of the Company’s businesses and prospects; 

  

	 	(b)	Assist in the development of the Company’s long-term business plan and related financial projections; 

  

	 	(c)	Assist in the development of financial data and presentations to the Company’s Board of Directors, various creditors and other third parties; 

  

			
	 	  	

	 	  	The Blackstone Group® L.P.
	 	  	345 Park Avenue
	 	  	New York, NY 10154
	 	  	212 583-5000

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	 	(d)	Analyze the Company’s financial liquidity and evaluate alternatives to improve such liquidity; 

  

	 	(e)	Analyze various restructuring scenarios and the potential impact of these scenarios on the recoveries of those stakeholders impacted by the Restructuring; 

 

	 	(f)	Provide strategic advice with regard to a Restructuring of the Company’s Obligations; 

  

	 	(g)	Evaluate the Company’s debt capacity and alternative capital structures; 

  

	 	(h)	Participate in negotiations among the Company and its creditors, suppliers, lessors and other interested parties; 

  

	 	(i)	Advise the Company and negotiate with lenders with respect to potential waivers or amendments of various credit facilities; 

  

	 	(j)	Assist in arranging debtor-in-possession (“DIP”) financing for the Company, as requested; 

  

	 	(k)	Provide expert witness testimony concerning any of the subjects encompassed by the other financial advisory services, if necessary; 

  

	 	(l)	Assist the Company in preparing marketing materials in conjunction with a possible Transaction; 

  

	 	(m)	Assist the Company in identifying potential buyers or parties in interest to a Transaction and assist in the due diligence process; 

  

	 	(n)	Assist and advise the Company concerning the terms, conditions and impact of any proposed Transaction; 

  

	 	(o)	Seek sources of debt and equity capital in connection with a Restructuring or a Transaction; and 

  

	 	(p)	Provide such other advisory services as are customarily provided in connection with the analysis and negotiation of a Restructuring or a Transaction, as requested and mutually
agreed. 

  
 Notwithstanding anything contained in
this Agreement to the contrary, Blackstone shall have no responsibility for designing or implementing any initiatives to improve the Company’s operations, profitability, cash management or liquidity. Blackstone makes no representations or
warranties about the Company’s ability to (i) successfully improve its operations, (ii) maintain or secure sufficient liquidity to operate its business, or (iii) successfully complete a Restructuring. Blackstone is retained under this Agreement
solely to provide advice regarding a Restructuring or a Transaction, and is not being retained to provide “crisis management.” 
  
 The Company will pay the following fees to Blackstone for its financial advisory services: 
  

	 	(i)	a monthly advisory fee (the “Monthly Fee”) in the amount of $200,000 in cash, with the first Monthly Fee payable upon the execution of this Agreement by both parties and
additional installments of such Monthly Fee payable in advance on each monthly anniversary of the Effective Date; 

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	 	(ii)	an additional fee (the “Restructuring Fee”) as specified in the table below. The Restructuring Fee shall be subject to reduction (the “Transaction Credit”) by a
percentage of the aggregate Transaction Fees received by Blackstone pursuant to this Agreement. The percentage used to calculate the Transaction Credit is specified in the table below. In no event will the amount of the Transaction Credit exceed the
amount of the Restructuring Fee; nor shall the sum of (i) the Transaction Fee plus (ii) the Restructuring Fee, net of any credits, exceed $10,500,000: 

  

							
	 Date on which
 Restructuring Fee is
earned

	  	Restructuring
Fee

	  	Transaction
Credit
percentage

	 
	 Prior to September 4, 2004
	  	$	8,000,000	  	None	 
			
	 On or after September 4, 2004 but prior to March 4, 2005
	  	$	7,000,000	  	25	%
			
	 On or after March 4, 2005
	  	$	6,000,000	  	50	%

  
 Except as otherwise
provided herein, a Restructuring shall be deemed to have been consummated upon (a) the binding execution and effectiveness of all necessary waivers, consents, amendments or restructuring agreements between the Company and its creditors involving the
compromise of the face amount of such Obligations or the conversion of all or part of such Obligations into alternative securities, including equity, in the case of an out-of-court restructuring; or (b) the execution and confirmation of a Plan of
Reorganization pursuant to an order of the Bankruptcy Court, in the case of an in-court restructuring. The Restructuring Fee will be: 
  

	 	(I)	earned on the earliest of: 

  

	 	(w)	consummation of the Restructuring, 

  

	 	(x)	in the event the Company attempts to implement the Restructuring in whole or in part by means of an exchange offer, then upon commencement of the exchange offer,

  

	 	(y)	in the event that the Company attempts to implement the Restructuring by means of a prenegotiated plan of reorganization under chapter 11 of the United States Bankruptcy Code, the
receipt of sufficient commitments, agreements or other expressions of intention to accept such plan that the Company elects to file a chapter 11 case and therein represent to the Bankruptcy Court hearing such case that the Company will seek to
confirm a plan based on the prenegotiated plan, and 

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	 	(z)	in the event that the Company solicits acceptances for a prepackaged plan of reorganization under chapter 11 to implement the Restructuring, then on the date established as the
voting deadline for such acceptances or rejections, provided that at least one class of creditors impaired by such plan has accepted such plan and 

  

	 	(II)	payable, in immediately available funds, on the earliest of: 

  

	 	(A)	consummation of the Restructuring, and 

  

	 	(B)	consummation of the exchange offer. 

  
 Notwithstanding the foregoing, (a) a Restructuring specifically shall be deemed to exclude any assumption at face value of Obligations in connection with
the sale or disposition of any subsidiaries, joint ventures, assets or lines of business of the Company and (b) the restructured Obligations shall exclude any Obligations in respect of which a Restructuring Fee has previously been paid; 

 

	 	(iii)	upon the consummation of a Transaction, a Transaction fee (“Transaction Fee”) payable in cash directly out of the gross proceeds of the Transaction calculated as 2% of the
Consideration. 

  
 As used in this Agreement,
Consideration means the gross value of all cash, securities and other properties paid, payable or raised directly or indirectly, in one transaction or in a series or combination of transactions, in connection with the Transaction or a transaction
related thereto (including, without limitation, amounts paid (A) pursuant to covenants not to compete or similar arrangements and (B) to holders of any warrants, stock purchase rights, convertible securities or similar rights and to holders of any
options or stock appreciation rights, whether or not vested). Consideration shall also include the face amount of any long-term liabilities or preferred stock (including indebtedness for borrowed money and the amount set forth in the Company’s
financial statements for any pension liabilities and guarantees) indirectly or directly assumed or acquired, or otherwise repaid or retired, in connection with or in anticipation of the Transaction. Consideration shall also include the aggregate
amount of any extraordinary dividend or distribution made by the Company from the date hereof until the closing of the Transaction. If the Transaction takes the form of a purchase of assets, Consideration shall also include (i) the value of any
current assets not purchased, minus (ii) the value of any current operating liabilities not assumed, in either case as relates to the business(es) or operations being purchased. Consideration shall include all amounts paid into escrow and all
contingent payments payable in connection with the Transaction, with fees on amounts paid into escrow to be 

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 payable upon the establishment of such escrow and fees on contingent payments to be payable when such
contingent payments are made. If the Consideration to be paid is computed in any foreign currency, the value of such foreign currency shall, for purposes hereof, be converted into U.S. dollars at the prevailing exchange rate on the date or dates on
which such Consideration is paid. 
  
 In this Agreement, the
value of any securities (whether debt or equity) or other property paid or payable as part of the Consideration shall be determined as follows: (1) the value of securities that are freely tradable in an established public market will be determined
on the basis of the last market closing price prior to the public announcement of the Transaction; and (2) the value of securities that are not freely tradable or have no established public market or, if the Consideration utilized consists of
property other than securities, the value of such other property shall be the fair market value thereof as mutually agreed by the parties hereto; and 
  

	 	(iv)	reimbursement of all reasonable out-of-pocket expenses incurred during this engagement, including, but not limited to, travel and lodging, direct identifiable data processing and
communication charges, courier services, working meals, reasonable fees and expenses of Blackstone’s counsel and other necessary expenditures, payable upon rendition of invoices setting forth in reasonable detail the nature and amount of such
expenses. In connection therewith the Company shall pay Blackstone on the Effective Date and maintain thereafter a $25,000 expense advance for which Blackstone shall account upon termination of this Agreement. 

  
 In the event that the Company is or becomes a debtor under Chapter 11 of the
Bankruptcy Code, the Company shall use its best efforts to promptly apply to the bankruptcy court having jurisdiction over the Chapter 11 case or cases (the “Bankruptcy Court”) for the approval pursuant to sections 327 and 328 of the
Bankruptcy Code of (A) this Agreement, including the attached indemnification agreement, and (B) Blackstone’s retention by the Company under the terms of this Agreement and subject to the standard of review provided in section 328(a) of the
Bankruptcy Code and not subject to any other standard of review under section 330 of the Bankruptcy Code. The Company shall supply Blackstone with a draft of such application and any proposed order authorizing Blackstone’s retention
sufficiently in advance of the filing of such application and proposed order to enable Blackstone and its counsel to review and comment thereon. Blackstone shall have no obligation to provide any services under this Agreement in the event that the
Company becomes a debtor under the Bankruptcy Code unless Blackstone’s retention under the terms of this Agreement is approved under section 328(a) of the Bankruptcy Code by a final order of the Bankruptcy Court no longer subject to appeal,
rehearing, reconsideration or petition for certiorari, and which order is acceptable to Blackstone in all respects. Blackstone acknowledges that in the event that the Bankruptcy Court approves its retention by the Company, Blackstone’s fees and
expenses shall be subject to the jurisdiction and approval of the Bankruptcy Court under section 328(a) of the Bankruptcy Code and any applicable fee and expense guideline orders; provided, however, that Blackstone shall not be 

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 required to maintain time records and, provided further, that Blackstone shall not be required to maintain receipts for
expenses in amounts less than $75. In the event that the Company becomes a debtor under the Bankruptcy Code and Blackstone’s engagement hereunder is approved by the Bankruptcy Court, the Company shall pay all fees and expenses of Blackstone
hereunder as promptly as practicable in accordance with the terms hereof. Prior to commencing a Chapter 11 case, the Company shall pay all invoiced amounts to Blackstone in immediately available funds by wire transfer. 
  
 With respect to Blackstone’s retention under sections 327 and 328 of the
Bankruptcy Code, the Company acknowledges and agrees that Blackstone’s restructuring expertise as well as its capital markets knowledge, financing skills and mergers and acquisitions capabilities, some or all of which may be required by the
Company during the term of Blackstone’s engagement hereunder, were important factors in determining the amount of the various fees set forth herein, and that the ultimate benefit to the Company of Blackstone’s services hereunder could not
be measured merely by reference to the number of hours to be expended by Blackstone’s professionals in the performance of such services. The Company also acknowledges and agrees that the various fees set forth herein have been agreed
upon by the parties in anticipation that a substantial commitment of professional time and effort will be required of Blackstone and its professionals hereunder over the life of the engagement, and in light of the fact that such commitment may
foreclose other opportunities for Blackstone and that the actual time and commitment required of Blackstone and its professionals to perform its services hereunder may vary substantially from week to week or month to month, creating “peak
load” issues for the firm. In addition, given the numerous issues which Blackstone may be required to address in the performance of its services hereunder, Blackstone’s commitment to the variable level of time and effort necessary to
address all such issues as they arise, and the market prices for Blackstone’s services for engagements of this nature in an out-of-court context, the Company agrees that the fee arrangements hereunder (including the Monthly Fee, DIP Financing
Fee, Restructuring Fee, and Transaction Fee) are reasonable under the standards set forth in 11 U.S.C. Section 328(a). 
  
 The advisory services and compensation arrangement set forth in this Agreement do not encompass other investment banking services or transactions that may
be undertaken by Blackstone at the request of the Company issuing fairness opinions or any other specific services not set forth in this Agreement. The terms and conditions of any such investment banking services, including compensation
arrangements, would be set forth in a separate written agreement between Blackstone and the appropriate party. 
  
 Except as contemplated by the terms hereof or as required by applicable law or legal process, Blackstone shall keep confidential all material non-public
information provided to it by or at the request of the Company, and shall not disclose such information to any third party or to any of its employees or advisors except to those persons who have a need to know such information in connection with
Blackstone’s performance of its responsibilities hereunder and who are advised of the confidential nature of the information and who agree to keep such information confidential. 

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 The Company will furnish or cause to be furnished to Blackstone such information as Blackstone believes
appropriate to its assignment (all such information so furnished being the “Information”). The Company recognizes and confirms that Blackstone (a) will use and rely primarily on the Information and on information available from generally
recognized public sources in performing the services contemplated by this Agreement without having independently verified the same, (b) does not assume responsibility for the accuracy or completeness of the Information and such other information,
(c) is entitled to rely upon the Information without independent verification, and (d) will not make an appraisal of any assets in connection with its assignment. 
  
 In the event that the Information belonging to the Company is stored electronically on Blackstone’s computer systems,
Blackstone shall not be liable for any damages resulting from unauthorized access, misuse or alteration of such information by persons not acting on its behalf, provided that Blackstone exercises the same degree of care in protecting the
confidentiality of, and in preventing unauthorized access to, the Company’s information that it exercises with regard to its own most sensitive proprietary information. 
  
 Except as required by applicable law, any advice to be provided by Blackstone under this Agreement shall not be disclosed
publicly or made available to third parties (other than the Company’s other professional advisors or, if appropriate in the Company’s judgment, in any filings in a Chapter 11 proceeding) without the prior written consent of Blackstone. All
services, advice and information and reports provided by Blackstone to the Company in connection with this assignment shall be for the sole benefit of the Company and shall not be relied upon by any other person. 
  
 The Company acknowledges and agrees that Blackstone will provide its
financial advice exclusively to the members of the Board of Directors and senior management of the Company and not to the Company’s shareholders or other constituencies. The Board of Directors and senior management will make all decisions for
the Company regarding whether and how the Company will pursue a Restructuring or Transaction and on what terms and by what process. In so doing, the Board of Directors and senior management will also obtain the advice of the Company’s legal,
tax and other business advisors and consider such other factors which they consider appropriate before exercising their independent business judgment in respect of a Restructuring or Transaction. The Company further acknowledges and
agrees that Blackstone has been retained to act solely as financial advisor to the Company and does not in such capacity act as a fiduciary for the Company or any other person. Blackstone shall act as an independent contractor and any duties of
Blackstone arising out of its engagement pursuant to this Agreement shall be owed solely to the Company. 
  
 In consideration of Blackstone’s agreement to provide financial advisory services to the Company in connection with this Agreement, it is agreed that
the Company will indemnify Blackstone and its agents, representatives, members and employees. A copy of our standard form of indemnification agreement is attached to this Agreement as Attachment A.  

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 In the event that, as a result of or in connection with Blackstone’s engagement for the Company,
Blackstone becomes involved in any legal proceeding or investigation or is required by government regulation, subpoena or other legal process to produce documents, or to make its current or former personnel available as witnesses at deposition or
trial, the Company will reimburse Blackstone for the reasonable fees and expenses of its counsel incurred in responding to such a request. Nothing in this paragraph shall affect in any way the Company’s obligations pursuant to the separate
indemnification agreement attached hereto. 
  
 Blackstone’s
engagement hereunder may be terminated upon 30 days’ written notice without cause by either the Company or Blackstone; termination for cause by either party will occur forthwith. Notwithstanding the foregoing, (a) the provisions relating to the
payment of fees and expenses accrued through the date of termination, the status of Blackstone as an independent contractor and the limitation as to whom Blackstone shall owe any duties will survive any such termination, (b) any such termination
shall not affect the Company’s obligations under the indemnification agreement attached as Attachment A or Blackstone’s confidentiality obligations hereunder and (c) Blackstone shall be entitled to the Restructuring Fee or Transaction Fee
in the event that a Restructuring or Transaction, respectively, is consummated at any time prior to the expiration of 24 months following the termination of this Agreement. 
  
 The Company does not appear on the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets
Control of the United States Department of the Treasury, nor is it a prohibited party according to other U.S. government regulatory or enforcement agencies. 
  
 Notwithstanding anything to the contrary provided elsewhere herein, none of the provisions of this Agreement shall in any way limit the activities of
Blackstone Group Holdings L.L.C. and its affiliates in their businesses distinct from the restructuring advisory business of The Blackstone Group L.P., provided that the Information is not made available to representatives of Blackstone Group
Holdings L.L.C. and its affiliates who are not involved in the restructuring advisory business of The Blackstone Group L.P. and that appropriate “Chinese wall” measures are taken to insure confidentiality. Notwithstanding the immediately
preceding sentence, neither Blackstone Group Holdings L.L.C. nor any of its affiliates shall purchase, advise any third party regarding a purchase or otherwise participate in the purchase of the Company’s or any of its subsidiaries’ stock,
assets, claims or securities without the prior written consent of the Company. 
  
 This Agreement (including the attached indemnification agreement) embodies the entire agreement and understanding between the parties hereto and supersedes all prior agreements and understandings relating to the
subject matter hereof. If any provision of this Agreement is determined to be invalid or unenforceable in any respect, such determination will not affect the Agreement in any other respect, which will remain in full force and effect. No waiver,
amendment or other modification of this Agreement shall be effective unless in writing and 

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 signed by each party to be bound thereby. This Agreement shall be governed by, and construed in accordance with, the laws
of the State of New York applicable to contracts executed in and to be performed in that state. 
  
 The Company hereby agrees that any action or proceeding brought by the Company against Blackstone based hereon or arising out of Blackstone’s
engagement hereunder, shall be brought and maintained by the Company exclusively in the courts of the State of New York located in the City and County of New York or in the United States District Court for the Southern District of New York;
provided, if the Company commences a Chapter 11 case, all legal proceedings pertaining to this engagement arising after such case is commenced may be brought in the Bankruptcy Court handling such case. The Company irrevocably submits to the
jurisdiction of the courts of the State of New York located in the City and County of New York and the United States District Court for the Southern District of New York and appellate courts from any thereof for the purpose of any action or
proceeding based hereon or arising out of Blackstone’s engagement hereunder and irrevocably agrees to be bound by any judgment rendered thereby in connection with such action or proceedings. The Company hereby irrevocably waives, to the fullest
extent permitted by law, any objection it may have or hereafter may have to the laying of venue of any such action or proceeding brought in any such court referred to above and any claim that such action or proceeding has been brought in an
inconvenient forum and agrees not to plead or claim the same. 

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 Please confirm that the foregoing correctly sets forth our agreement by signing and returning to
Blackstone the duplicate copy of this Agreement and the indemnification agreement attached hereto as Attachment A. 
  

			
	 Very truly yours,

	
	 THE BLACKSTONE GROUP L.P.

		
	 By:
	 	  

	 Name:
	 	 Timothy R. Coleman

	 Title:
	 	 Senior Managing Director

  

			
	 Accepted and Agreed to as
 of the date first written above:

	
	 RCN Corporation

		
	 By:
	 	  

	 Name:
	 	 David C. McCourt

	 Title:
	 	 Chairman and Chief Executive Officer

 ATTACHMENT A 
  
 March 9, 2004 
  
 The Blackstone Group L.P. 
 345 Park Avenue 
 New York, NY 10154 
  
 INDEMNIFICATION AGREEMENT 
  
 Gentlemen: 
  
 This letter will confirm that we have engaged The Blackstone Group L.P.
(“Blackstone”) to advise and assist us in connection with the matters referred to in our letter of agreement dated as of March 9, 2004 (the “Engagement Letter”). In consideration of your agreement to act on our behalf in
connection with such matters, we agree to indemnify and hold harmless you and your affiliates and your and their respective partners (both general and limited), members, officers, directors, employees and agents and each other person, if any,
controlling you or any of your affiliates (you and each such other person being an “Indemnified Party”) from and against any losses, claims, damages, expenses and liabilities whatsoever, whether they be joint or several, related to,
arising out of or in connection with the engagement (the “Engagement”) under the Engagement Letter and will reimburse each Indemnified Party for all expenses (including reasonable fees, expenses and disbursements of counsel) as they are
incurred in connection with investigating, preparing, pursuing, defending or assisting in the defense of any action, claim, suit, investigation or proceeding related to, arising out of or in connection with the Engagement or this agreement, whether
or not pending or threatened, whether or not any Indemnified Party is a party, whether or not resulting in any liability and whether or not such action, claim, suit, investigation or proceeding is initiated or brought by us. We will not, however, be
liable under the foregoing indemnification provision for any losses, claims, damages or liabilities (or expenses relating thereto) that are finally judicially determined by a court of competent jurisdiction to have primarily resulted from the gross
negligence or willful misconduct of Blackstone. We also agree that no Indemnified Party shall have any liability (whether direct or indirect, in contract or tort or otherwise) to us or our owners, parents, affiliates, security holders or creditors
for or in connection with the Engagement except for any such liability for losses, claims, damages or liabilities incurred by us that are finally judicially determined by a court of competent jurisdiction to have primarily resulted from the gross
negligence or willful misconduct of Blackstone. 
  
 If the
indemnification provided for in the preceding paragraph is for any reason unavailable to an Indemnified Party in respect of any losses, claims, damages or liabilities 

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 referred to herein, then, in lieu of indemnifying such Indemnified Party hereunder, we shall contribute to the amount
paid or payable by such Indemnified Party as a result of such losses, claims, damages or liabilities (and expenses relating thereto) (i) in such proportion as is appropriate to reflect the relative benefits received (or anticipated to be received)
by you, on the one hand, and us, on the other hand, from the Engagement or (ii) if and only if the allocation provided by clause (i) above is for any reason not available, in such proportion as is appropriate to reflect not only the relative
benefits referred to in such clause (i) but also the relative fault of each of you and us, as well as any other relevant equitable considerations; provided, however, to the extent permitted by applicable law, in no event shall your aggregate
contribution to the amount paid or payable exceed the aggregate amount of fees actually received by you under the Engagement Letter. For the purposes of this agreement, the relative benefits to us and you of the Engagement shall be deemed to be in
the same proportion as (a) the total value paid or contemplated to be paid or received or contemplated to be received by us, our security holders and our creditors in the transaction or transactions that are subject to the Engagement, whether or not
any such transaction is consummated, bears to (b) the fees paid or to be paid to Blackstone under the Engagement Letter (excluding any amounts paid as reimbursement of expenses). 
  
 Neither party to this agreement will, without the prior written consent of the other party (which consent will not be
unreasonably withheld), settle or compromise or consent to the entry of any judgment in any pending or threatened claim, action, suit or proceeding in respect of which indemnification may be sought hereunder (a “Judgment”), whether or not
we or any Indemnified Party are an actual or potential party to such claim, action, suit or proceeding. In the event that we seek to settle or compromise or consent to the entry of any Judgment, we agree that such settlement, compromise or consent
(i) shall include an unconditional release of Blackstone and each other Indemnified Party hereunder from all liability arising out of such claim, action, suit or proceeding, (ii) shall not include a statement as to, or an admission of, fault,
culpability or a failure to act by or on behalf of Blackstone or each other Indemnified Party, and (iii) shall not impose any continuing obligations or restrictions on Blackstone or each other Indemnified Party. 
  
 Promptly after receipt by an Indemnified Party of notice of any complaint or
the commencement of any action or proceeding with respect to which indemnification is being sought hereunder, such person will notify us in writing of such complaint or of the commencement of such action or proceeding, but failure to so notify us
will not relieve us from any liability which we may have hereunder or otherwise, except to the extent that such failure materially prejudices our rights. If we so elect or are requested by such Indemnified Party, we will assume the defense of such
action or proceeding, including the employment of counsel reasonably satisfactory to Blackstone and the payment of the fees and disbursements of such counsel. 
  

In the event, however, such Indemnified Party reasonably determines in its judgment that having common counsel would present such counsel with a
conflict of interest or if we fail to assume the defense of the action or proceeding in a timely manner, then such Indemnified Party may employ separate counsel reasonably satisfactory to us to represent or defend it in any such 

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 action or proceeding and we will pay the fees and disbursements of such counsel; provided, however, that we will not be
required to pay the fees and disbursements of more than one separate counsel for all Indemnified Parties in any jurisdiction in any single action or proceeding. In any action or proceeding the defense of which we assume, the Indemnified Party will
have the right to participate in such litigation and to retain its own counsel at such Indemnified Party’s own expense. 
  
 The foregoing reimbursement, indemnity and contribution obligations of the Company under this agreement shall be in addition to any rights that an
Indemnified Party may have at common law or otherwise, and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Company and such Indemnified Party. 
  
 The provisions of this agreement shall apply to the Engagement and any
written modification of the Engagement and shall remain in full force and effect regardless of any termination or the completion of your services under the Engagement Letter. 

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 This Agreement and the Engagement Letter shall be governed by and construed in accordance with the laws
of the State of New York applicable to contracts executed in and to be performed in that state. 
  

			
	 Very truly yours,

	
	 RCN Corporation

		
	 By:
	 	  

	 Name:
	 	 David C. McCourt

	 Title:
	 	 Chairman and CEO

  

			
	 Accepted and Agreed to as of the date first written above:

	
	 THE BLACKSTONE GROUP L.P.

		
	 By:
	 	  

	 	 	 Timothy R. Coleman

	 	 	 Senior Managing DirectorAgreement Between Merrill Lynch & Co. and RCN Corporation

 Exhibit 10.21 
  
 

 
  

			
	 Global Markets & Investment Banking
	  	December 16, 2003

  
 Mr. Douglas Bradbury 
 Executive Vice President 
 RCN Corporation 
 105 Carnegie Center 
 Princeton, NJ 08540 
  
 Dear Doug: 
  
 Merrill Lynch & Co. (“Merrill Lynch”) is pleased to act as financial advisor to RCN Corporation (the
“Company”) and each of its wholly owned and majority owned subsidiaries (each, a “Controlled Subsidiary”) in connection with any Restructuring Transaction, any Capital Raising Transaction, and/or any Business Combination or Sale
Transaction by or on behalf of the Company or any person or entity formed by or affiliated with the Company (each a “Company Affiliate”) and another party (a “Party”) as set forth herein. This letter agreement is to confirm our
understanding with respect to our engagement. 
  

	(1)	As used in this letter agreement, the term “Restructuring Transaction” shall mean any restructuring, modification, reduction, reorganization (whether or not pursuant to
Chapter 11 of the United States Bankruptcy Code), refinancing and/or recapitalization of the Company with respect to all or a substantial portion of its existing debt obligations listed on Annex B hereto, including, without limitation, a
solicitation of waivers and/or consents; rescheduling of debt maturities; changes in interest rates; settlement or forgiveness of debt; conversion of debt and/or other liabilities into equity; exchange offer involving new securities; or other
similar transaction or series of transactions. 

  

	(2)	As used in this letter agreement, the term “Capital Raising Transaction” shall mean: 

  

	 	(a)	the issuance for cash by the Company or any Company Affiliate in a public or private offering or placement (including any transaction under Rule 144A of the Securities Act of 1933,
as amended) of debt, equity or trust preferred securities or similar instruments, including, without limitation, high yield debt securities, debt securities attached with warrants, mezzanine securities, preferred securities, securities exchangeable
for or exercisable or convertible into debt or equity securities, asset backed securities, or security equivalents; or 

  

	 	(b)	the entering into, or borrowing under, any credit or loan facility or agreement, including but not limited to a second lien credit facility, letter of credit or other debt
arrangement by the Company or any Company Affiliate (excluding the Company’s existing credit facility with JP Morgan Chase, the Evergreen silent second lien facility and any sale and leaseback arrangements and all other credit arrangements now
in place, but including all restructuring, refinancing, modifications and replacements thereof). 

  

	(3)	As used in this letter agreement, the term “Business Combination” means, whether effected in one transaction or a series of transactions: 

  

	 	(a)	any merger, consolidation or other business combination pursuant to which all or substantially all of the business of the Company is combined with that of one or more Parties or one
or more persons formed by or affiliated with a Party, including, without limitation, any joint venture; 

  

	 	(b)	except to the extent that any such transaction would constitute a Sale Transaction, the acquisition, directly or indirectly, by one or more Parties of all or substantially all of
the assets of, or of any right to all or substantially all of the revenues or income of, the Company by way of a negotiated purchase, lease, license, exchange, joint venture or other means; or 

  

	 	(c)	the acquisition, directly or indirectly, by one or more Parties of control of the Company otherwise than through the acquisition of the Company’s capital stock including,
without limitation, by means of the acquisition directly or indirectly, of all or any part of the Company’s debt and transactions effected in connection with, in contemplation of, or as part of a Restructuring Transaction.

  

					
	 Mark C Bush
 Director
	 	 4 World Financial Center
 Floor 29
 New York, NY 10080
	 	 212 449 6642
 FAX 212 449 9120

  

 1 

	(4)	As used in this letter agreement, the term “Sale Transaction” means, whether effected in one transaction or a series of transactions: 

  

	 	(a)	any merger, consolidation or other business combination pursuant to which less than substantially all of the business of the Company is combined with that of one or more Parties or
one or more persons formed by or affiliated with a Party, including, without limitation, any joint venture; or 

  

	 	(b)	the acquisition, directly or indirectly, by one or more Parties of less than substantially all of the assets of, or of any right to less than substantially all of the revenues or
income of, any other assets or businesses of the Company by way of a negotiated purchase, lease, license, exchange, joint venture or other means. 

  

For the purposes of this letter agreement, a Restructuring Transaction, a Capital Raising Transaction, a Business Combination and a Sale Transaction
are together referred to as “Transaction(s)” and Transactions shall include, without limitation, transactions with or by the Company prior to filing for bankruptcy and after emergence from any bankruptcy or other reorganization.

  
 Merrill Lynch will assist the Company in identifying Parties
and in analyzing, structuring, negotiating and effecting proposed Transactions on the terms and conditions of this letter agreement; provided, however, that in connection with a Restructuring Transaction intended to comply with the requirements of
Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”), Merrill Lynch shall not provide any services in connection with such Restructuring Transaction, the effect of which would cause the Restructuring Transaction
to fail to meet the requirements for an exemption from the registration requirements of Section 5 of the Securities Act provided by Section 3(a)(9) of the Securities Act. 
  
 If reasonably requested by the Company, Merrill Lynch will render an opinion (the “Opinion”) as to whether or not
the consideration to be paid or received in a proposed Business Combination or a Sale Transaction is fair to the Company from a financial point of view. It is understood that the Opinion will be dated as of a date reasonably proximate to the date of
the definitive agreement between the Company and a Party providing for a Business Combination or a Sale Transaction, as the case may be. It is further understood that the Opinion will be prepared solely for the confidential use of the Board of
Directors and senior management of the Company and will not be reproduced, summarized, described or referred to or given to any other person without Merrill Lynch’s prior written consent. It is further understood that, if the Opinion is
included in the proxy statement or offer to purchase to be mailed to the shareholders of the Company in connection with a Business Combination or Sale Transaction, the Opinion will be reproduced in such proxy statement or offer to purchase in full,
and any description of or reference to Merrill Lynch or summary of the Opinion in such proxy statement or offer to purchase will be in a form acceptable to Merrill Lynch and its counsel. Except as provided in this letter agreement, the Opinion will
not be reproduced, summarized, described or referred to without Merrill Lynch’s prior written consent. Any document or oral or written advice or analysis provided by Merrill Lynch in connection with its engagement hereunder will be solely for
the confidential use of the Board of Directors, counsel and senior management of the Company and will not be disclosed, quoted, reproduced, summarized, described or referred to, nor will any references to Merrill Lynch be made, without Merrill
Lynch’s prior written consent, unless required by law. 
  
 So
as to better co-ordinate proposals and discussions concerning any Transaction, in the event that, during the period of Merrill Lynch’s engagement, the Company or any Controlled Subsidiary or any of its officers, directors, employees or
representatives initiate discussions with or are contacted by or on behalf of any party concerning the possibility of a Transaction, the Company will promptly inform Merrill Lynch in order that Merrill Lynch can evaluate such prospective Party and
its interest and assist the Company and the Controlled Subsidiaries in any subsequent discussions. 
  
 Notwithstanding anything contained in this letter agreement to the contrary: (a) Merrill Lynch makes no representations or warranties about the
Company’s or any Controlled Subsidiary’s ability to (i) successfully improve its operations, (ii) maintain sufficient liquidity to operate its business, (iii) successfully complete any Transactions and (b) Merrill Lynch makes no
representation, warranty or commitment to underwrite, place or purchase any securities or provide any form of financing to the Company or any Controlled Subsidiary. 
  
 The Company and each Controlled Subsidiary, jointly and severally, agree to pay the following fees to Merrill Lynch for its financial
advisory services: 
  

	(1)	 A monthly fee of $100,000 payable in cash, in advance on the first business day of each month and ending on the earlier of the termination of Merrill Lynch’s
engagement or the actual payment of any additional fee pursuant to Clauses (3), (6) 

  

 2 

	 	 
or (8). Any amounts actually paid pursuant to this clause will be credited towards fees payable pursuant to clauses (3), (6) and (8) of this paragraph;

  

	(2)	“Milestone” fees: 

  

	 	(a)	A Milestone fee of $1,000,000 payable in cash immediately in the event an agreement in principle is reached with one class of creditors and/or investors (or their designated
representatives, other than a Mezzanine Investor as described in (b) below) as part of a proposed Restructuring Transaction. Any Milestone fees actually paid pursuant to this clause 2(a) will be credited towards fees payable pursuant to clauses (3),
(6) and (8) of this paragraph, provided that in the event such Restructuring Transaction is not consummated then any Milestone fees paid to Merrill Lynch pursuant to this clause 2(a), during the period Merrill Lynch is retained by the Company or
within one year thereafter, will be refunded to the Company by Merrill Lynch. 

  

	 	(b)	A Milestone fee equivalent to 50% of the actual fee that would be payable pursuant to paragraph 5 (b) below, payable in cash immediately, in the event an agreement in principle is
reached with a prospective investor(s) in a Mezzanine Security (as defined in paragraph 5 below). Any Milestone fees actually paid pursuant to this clause 2(b) will be credited towards fees payable pursuant to clause (5) (b) of this paragraph,
provided that in the event a Capital Raising Transaction of the type describe in Clause 5 (b) is not consummated, then any Milestone fees paid to Merrill Lynch pursuant to this clause 2(b) will be refunded to the Company by Merrill Lynch.

  

	(3)	If, during the period Merrill Lynch is retained by the Company, or within one year thereafter, the Company undergoes a successful Restructuring Transaction with its creditor and/or
investor groups (other than a Restructuring Transaction intended to comply with the requirements of Section 3(a)(9) of the Securities Act (a “3(a)(9) Offer”)), an advisory fee of $7,500,000, will be payable in cash immediately. In
addition, if the Company terminates Merrill Lynch’s engagement, then it is understood that Merrill Lynch’s advisory fee will be decreased to a total of $5,000,000 and will be payable in cash immediately upon the approval of or agreement to
a Restructuring Transaction (other than a 3(a)(9) Offer) occurring within one year of the termination of Merrill Lynch’s engagement pursuant to this letter agreement. Notwithstanding the prior sentence, if a successful Restructuring Transaction
(other than a 3(a)(9) Offer) is completed by the Company with its investor and/or creditor groups during the period of one year after the end of Merrill Lynch’s engagement hereunder and such Restructuring Transaction is substantially similar to
a proposal for a Restructuring Transaction (other than a 3(a)(9) Offer) that Merrill Lynch presented to the Company during the term of its engagement, a fee of $7,500,000 will be payable in cash immediately upon the approval of or agreement to the
Restructuring Transaction. In no event will the advisory fee (as described in this clause (3), clause (6) below and clause (8) below) total more than $7,500,000; 

  

	(4)	An additional fee in an amount equal to 0.50% of the face amount of current securities of the Company or a Company Affiliate purchased in connection with any cash tender offer or
exchange offer (other than a 3(a)(9) Offer) by the Company or a Company Affiliate relating to an offer to purchase the Company’s or Company Affiliate’s outstanding debt, and/or debt securities, in each case contingent upon and payable in
cash upon the first purchase or exchange of securities pursuant to such tender offer or exchange offer, as the case may be; 50% of any fees actually paid in connection with any cash tender offer or exchange offer pursuant to this clause (4), will be
credited towards fees payable pursuant to clauses (3), (6) and (8) of this paragraph; 

  

	(5)	In connection with a Capital Raising Transaction, an initial purchaser’s, placement agent’s or underwriters’ discount, or bank/loan commitment, utilization and other
customary lending fees and interest, as the case may be, in amounts customary for the provision of such services by comparable investment banks and/or lenders and in each case as agreed to in advance by the Company and Merrill Lynch, will be payable
in cash in U.S. Dollars to Merrill Lynch at the time of the closing of the sale of such securities or at the time of execution of any relevant credit or other applicable type of agreement, or as specifically otherwise provided therein. Specifically,
if the Capital Raising Transaction involves: 

  

	 	(a)	The syndication of a new second lien credit facility, then Merrill Lynch would be entitled to receive a syndication fee of 1.75% on the aggregate amount of commitments under the
credit/loan facility, payable on the date of execution of such credit facility; or 

  

	 	(b)	 The issuance of a “Mezzanine Security” (for these purposes a Mezzanine Security will include a security that has characteristics separate from a second
lien credit facility which include but are not limited to: a cash deferral feature on coupon payments, the inclusion of warrants, detachable or otherwise, the inclusion of equity-linked features, 

  

 3 

	 	 
and/or corporate governance provisions), then Merrill Lynch would be entitled to receive a placement fee equal to 3.5% of the aggregate proceeds of any
Mezzanine Security. 

  
 Any Capital Raising
Transaction fees actually paid pursuant this clause in excess of $3,000,000, will result in a reduction of the fees payable pursuant to clauses (3), (6) and (8) of this paragraph. Notwithstanding the foregoing, if Vulcan Ventures Inc participates as
a primary investor in any such Mezzanine Security, the placement fee payable to Merrill Lynch in respect of that investment will be 0.5% less than the applicable placement fee payable in respect of any other investor(s). 
  
 If, during the term of this letter agreement or within a 12 month period
thereafter, the Company or any Company Affiliate enters into a Capital Raising Transaction, pursuant to an agreement in principle reached or entered into by the parties thereto during the term of Merrill Lynch’s engagement (whether or not in
writing or binding upon the parties thereto or subject to conditions precedent), Merrill Lynch shall be entitled to receive, and you agree to pay or to cause to be paid to Merrill Lynch, a fee upon the closing of such transaction calculated in
accordance with this Clause 5 as if Merrill Lynch had placed or underwritten all of such securities; 
  

	(6)	In connection with any Restructuring Transaction not otherwise described above, (i) that is intended to be effected, in whole or in part, as a prepackaged, partial prepackaged, or
prearranged plan of reorganization anticipated to involve the solicitation of acceptances of such plan in compliance with the bankruptcy laws of any jurisdiction, by or on behalf of the Company, from holders of any class of the Company’s
securities or indebtedness (a “Plan”) and (ii) that is not intended to comply with Section 3(a)(9) of the Securities Act, a fee in an amount equal to $7,500,000 shall be payable (x) upon receipt of votes from the Company’s creditors
necessary to confirm a prepackaged Plan, the terms of which are acceptable to the Company’s Board of Directors or (y) upon obtaining indications of support from the Company’s creditors which in the good faith judgment of the Board of
Directors of the Company are sufficient to justify filing a prearranged plan of reorganization upon acceptable terms. In addition, if the Company terminates Merrill Lynch’s engagement then it is understood that Merrill Lynch’s
Restructuring Transaction fee, as described above in this clause 6, will be decreased to a total of $5,000,000 and will be payable in cash immediately upon (x) upon receipt of votes from the Company’s creditors necessary to confirm a
prepackaged Plan, the terms of which are acceptable to the Company’s Board of Directors or (y) upon obtaining indications of support from the Company’s creditors which in the good faith judgment of the Board of Directors of the Company are
sufficient to justify filing a prearranged plan of reorganization upon acceptable terms. Notwithstanding the prior sentence, if a Restructuring Transaction, as described above in this clause 6, either (x) receives votes from the Company’s
creditors necessary to confirm a prepackaged Plan, the terms of which are acceptable to the Company’s Board of Directors or (y) upon obtaining indications of support from the Company’s creditors which in the good faith judgment of the
Board of Directors of the Company are sufficient to justify filing a prearranged plan of reorganization upon acceptable terms, during the period of one year after the end of Merrill Lynch’s engagement hereunder and such Restructuring
Transaction is substantially similar to a proposal for a Restructuring Transaction that Merrill Lynch presented to the Company during the term of its engagement, a fee of $7,500,000 will be payable immediately in cash to Merrill Lynch. In no event
will the advisory fee (as described in this clause (6), clause (3) above and clause (8) below) total more than $7,500,000; 

  

	(7)	 If, during the period Merrill Lynch is retained by the Company or within one year thereafter, (a) a Business Combination or a Sale Transaction is consummated with a
Party or (b) the Company enters into an agreement which subsequently results in a Business Combination or a Sale Transaction, an additional fee in an amount customarily payable for the provision of similar services by a comparable investment bank
and as agreed between the Company and Merrill Lynch, payable in cash with 50% of such fee becoming payable upon the execution of a definitive agreement to effect a Business Combination or a Sale Transaction and the remainder upon closing of such
Business Combination or Sale Transaction or, in the case of a tender offer or exchange offer, upon the first purchase or exchange of shares pursuant to such tender offer or exchange offer, as the case may be. Notwithstanding the foregoing Merrill
Lynch shall not be entitled to and shall not receive any fees in connection with any Business Combination or Sale Transaction in the event that such transaction occurs after the completion of a Restructuring Transaction provided, however, that in
the event any Business Combination or Sale Transaction occurs after the completion of a Restructuring Transaction and is substantially similar to a proposal made, or if it is consummated with a party that Merrill Lynch presented to the Company
during the term of its engagement, then Merrill Lynch will receive fees in an amount customarily payable for the provision of similar services by a comparable investment bank and as agreed between the Company and Merrill Lynch, payable in cash with
50% of such fee becoming payable upon the execution of a definitive agreement to effect a Business Combination or a Sale Transaction and the remainder upon closing of such Business Combination or Sale Transaction or, in the case of a tender offer or
exchange offer executed as part of a Business Combination or Sale Transaction, upon the first purchase or exchange of shares pursuant to such tender offer or exchange offer, as the case may be. In addition, provided that in the event such a Business
Combination or Sale Transaction is not consummated 

  

 4 

	 	 
after the signing of a definitive agreement, then any fees paid to Merrill Lynch as a result of the execution of a definitive agreement pursuant to this
clause 7, during the period Merrill Lynch is retained by the Company or within one year thereafter, will be refunded to the Company by Merrill Lynch. It is further understood, that Merrill Lynch shall not be entitled to and shall not receive any
fees in connection with any sale of the Lehigh Valley cable systems or the Company’s Los Angles systems, unless otherwise agreed to in writing by the Company. It is further understood that these fee exemptions apply only to the sale of these
properties and does not pertain to any other transactions regarding these properties which may or may not occur; 

  

	(8)	If the Restructuring Transaction is to be effectuated as a 3(a)(9) Offer, whether or not as part of a Plan (as defined above), a fee of $7,500,000 shall be earned by Merrill Lynch
on the date that definitive 3(a)(9) Offer documents are first distributed to creditors whose claims would be affected thereby, and a Milestone fee of $1,000,000 will be payable to Merrill Lynch immediately upon the first mailing, delivery or other
dissemination of such definitive 3(a)(9) Offer documents and the remainder of such fee 90 days thereafter. In addition, if the Company terminates Merrill Lynch’s engagement then it is understood that Merrill Lynch’s fee, as described in
this clause 8, will be decreased to a total of $5,000,000 if definitive 3(a)(9) Offer documents, whether or not as part of a Plan, have been mailed, delivered or otherwise disseminated within one year of the termination of Merrill Lynch’s
engagement under this letter agreement. Notwithstanding the prior sentence, if a 3(a)(9) Offer, whether or not as part of a Plan, is consummated during the one-year period after the end of Merrill Lynch’s engagement hereunder and such
Restructuring Transaction is substantially similar to a proposal for a 3(a)(9) Offer that Merrill Lynch presented to the Company during the term of its engagement, a fee of $7,500,000 will be payable in cash to Merrill Lynch on the date such 3(a)(9)
Offer is consummated. 

  
 Notwithstanding anything
contained in clauses (1) through (8) to the contrary, immediately prior to the commencement of a case by or against the Company or any Controlled Subsidiary pursuant to the United States Bankruptcy Code, the Company and each Controlled Subsidiary,
unless prohibited by law, shall pay jointly and severally to Merrill Lynch (or cause Merrill Lynch to be paid) to the extent the Company or any Controlled Subsidiary shall have had notice of the pending commencement of such case, in cash, all
amounts that have been earned but are unpaid to Merrill Lynch pursuant to this letter agreement on such date, including without limitation, the fees referred to in clauses (1) through (8) above. 
  
 Notwithstanding anything contained in clauses (1) through (8) to the
contrary, the Company agrees that if, and at such time as it has obtained formal acceptance of a prepackaged plan required to enable such plan to be confirmed pursuant to Section 1129(a)(8) or 1129(b) of the United States Bankruptcy Code, or the
informal indications of support referred to above with respect to a prearranged plan, Merrill Lynch thereupon shall have completed all of the work contemplated to be performed by it in connection with this letter agreement and that all of the fees
payable pursuant to this letter agreement shall have been earned in full. It is intended by the parties hereto that if, notwithstanding the previous paragraph, any of Merrill Lynch’s expenses and fees and the expenses and fees of Merrill
Lynch’s counsel payable pursuant hereto remain unpaid at the time of such filing, such fees and expenses shall be in the nature of pre-petition claims for pre-petition services which shall be treated as unimpaired trade claims pursuant to such
plan. If requested by Merrill Lynch, the Company hereby agrees to include in the plan of reorganization submitted to the bankruptcy court, appropriate provisions designed to effectuate the parties’ intentions as described herein, unless Merrill
Lynch has been paid by the Controlled Subsidiaries for all of its expenses and fees and the expenses and fees of its counsel payable pursuant hereto. 
  
 If, during the period Merrill Lynch is retained by the Company, the Company or any Company Affiliate proposes to effect (a) any bridge or bank financing,
(b) any public offering or private placement of securities, or (c) any tender or repurchase of securities, recapitalization, extraordinary dividend, spin-off, divestiture or consent solicitation (in each case, other than pursuant to a 3(a)(9)
Offer), the Company agrees to engage, or cause to be engaged, Merrill Lynch as a bank agent, underwriter, placement agent, dealer-manager, repurchasing agent, arranger or principal counterparty or exclusive financial advisor, as the case may be, in
connection with such transaction on Merrill Lynch’s customary terms (including without limitation, as applicable, representations, warranties, covenants, conditions, indemnities and fees, such fees to be in accordance with any express fee
provisions herein) for such transaction at such time; provided, however, that Merrill Lynch may decline any such engagement in its sole and absolute discretion. In any case, any such engagement by Merrill Lynch shall only become a commitment by
Merrill Lynch to assume such engagement when such engagement is set forth and agreed to by Merrill Lynch in a separate underwriter, financing, placement agency, dealer-manager or other applicable type of agreement. 
  
 In addition to any fees that may be payable to Merrill Lynch under this
letter agreement, the Company and each Controlled Subsidiary, jointly and severally, agree to reimburse Merrill Lynch, upon request made from time to time, for its reasonable out-of-pocket expenses incurred in connection with Merrill Lynch’s
activities under this letter agreement. The Company and each Controlled Subsidiary, jointly and severally, agree to pay Shearman & Sterling, Merrill Lynch’s counsel, a retainer of $100,000 and agrees to pay Shearman & Sterling’s
reasonable fees and disbursements which shall be 

  

 5 

 
billed monthly, in an itemized form reasonably acceptable to the Company, and which the Company and each Controlled Subsidiary agree to pay promptly and in
any event within 30 days. 
  
 The Company and each Controlled
Subsidiary will furnish Merrill Lynch (and will request that each prospective Party with which the Company or any Controlled Subsidiary enters into negotiations furnish Merrill Lynch) with such information as Merrill Lynch believes appropriate to
its assignment (all such information so furnished being the “Information”) and will update such Information as appropriate. The Company and each Controlled Subsidiary recognize and confirm that Merrill Lynch (a) will use and rely primarily
on the Information and on information available from generally recognized public sources in performing the services contemplated by this letter agreement without having independently verified the same, (b) does not assume responsibility for the
accuracy or completeness of the Information and such other information, (c) will not make an appraisal of any assets or liabilities of the Company and/or any Controlled Subsidiary or any prospective Party and does not assume responsibility as to the
solvency of, or issues relating to solvency concerning, the Company or any Controlled Subsidiary, and (d) with respect to any financial forecasts (including costs, savings and synergies) that may be furnished to or discussed with Merrill Lynch by
the Company, any Controlled Subsidiary or a Party, will assume that they have been reasonably prepared and reflect the best then currently available estimates and judgment of the Company’s, such Controlled Subsidiary’s or the Party’s
management. 
  
 In connection with engagements such as this, it is
Merrill Lynch’s policy to receive indemnification. The Company and each Controlled Subsidiary agree to the provisions with respect to the indemnification of Merrill Lynch and the other matters set forth in Annex A. Annex A is incorporated by
reference in its entirety into this letter. 
  
 Each of the
Company and the Controlled Subsidiaries acknowledges and agrees that Merrill Lynch has been retained to act solely as financial advisor to them. In such capacity, Merrill Lynch shall act as an independent contractor, and any duties of Merrill Lynch
arising out of its engagement pursuant to this letter agreement shall be owed solely to the Company and the Controlled Subsidiaries. 
  
 Merrill Lynch’s engagement hereunder shall terminate upon the earliest of (a) one year after the date hereof, unless extended in writing by Merrill
Lynch and the Company, (b) upon thirty days’ written notice from Merrill Lynch to the Company or from the Company to Merrill Lynch, or (c) such earlier date as may be mutually agreed in writing by Merrill Lynch and the Company, it being
understood that the provisions relating to the payment of fees and expenses, the agreement to retain Merrill Lynch for certain financing and other transactions, indemnification, limitations on the liability of Indemnified Parties, contribution,
settlements, the status of Merrill Lynch as an independent contractor, the limitation on to whom Merrill Lynch shall owe any duties and waiver of the right to trial by jury will survive any such termination. In the event that Merrill Lynch
terminates this engagement, without cause, Merrill Lynch agrees to waive its right to any fees as contemplated under this letter agreement that are payable but not yet due at the time of such termination. It is further understood that in the
event Merrill Lynch terminates this engagement without cause, under no circumstances, does Merrill Lynch waive its right to any earned fees and/or expenses due at the time of such termination. 
  
 The Company and each Controlled Subsidiary agree that, except as required by
applicable law, any reference to Merrill Lynch in any document prepared in connection with any activity referred to in this letter agreement or in any press release or other document or communication, is subject to the prior approval of Merrill
Lynch. 
  
 The Company and each Controlled Subsidiary acknowledge
that Merrill Lynch may, at its option and expense, place an announcement in such newspapers, periodicals and electronic medium as it may choose, stating that Merrill Lynch has acted as the exclusive financial advisor to the Company and the
Controlled Subsidiaries in connection with any Transaction. It is further understood that prior to any placement of the aforementioned announcement, Merrill Lynch will first be required to obtain the Company’s consent, which will not be
unreasonably withheld or delayed. 
  
 No waiver, amendment or
other modification of this letter agreement shall be effective unless in writing and signed by each party to be bound thereby. 
  
 This letter agreement shall be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts executed in and to
be performed in that state. 
  

 6 

 This letter agreement embodies the entire agreement and understanding between the parties hereto and
supersedes all prior agreements and understandings, both written and oral, relating to the subject matter hereof, including without limitation, the letter agreement dated as of September 2, 2003 by and between Merrill Lynch and the Company (other
than the provisions with respect to the indemnification of Merrill Lynch and the other matters set forth in Annex A thereto, which will survive such supersession and continue to apply and remain in full force and effect in accordance with the terms
thereof). 
  
 Each of Merrill Lynch, the Company (in its own
behalf and, to the extent permitted by applicable law, on behalf of its shareholders) and the Controlled Subsidiaries waives all right to trial by jury in any action, proceeding or counterclaim (whether based upon contract, tort or otherwise)
related to or arising out of the engagement of Merrill Lynch pursuant to, or the performance by Merrill Lynch of the services contemplated by, this letter agreement. 
  
 Please confirm that the foregoing correctly sets forth our agreement by signing and returning to Merrill Lynch the duplicate
copy of this letter agreement enclosed herewith. 
  

			
	Very truly yours,
	
	 MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

		
	By	 	 /s/ Mark Bush

	 	 	

	 	 	 Mark Bush
 Director
 Investment Banking Group

  

			
	 Accepted and agreed
 to as of the date
first
 written above:

	
	RCN CORPORATION
	
	for itself and on behalf of each of its wholly owned and majority owned subsidiaries
		
	By	 	 /s/ Doug Bradbury

	 	 	

	 	 	 Doug Bradbury
 Executive Vice President

  

 7 

 ANNEX A 
  
 The Company and each Controlled Subsidiary, jointly and severally, agree to indemnify Merrill Lynch and its affiliates and their respective directors,
officers, employees, agents and controlling persons (Merrill Lynch and each such person being an “Indemnified Party”) from and against any and all losses, claims, damages and liabilities, joint or several, to which such Indemnified Party
may become subject under any applicable law, or otherwise, and related to, arising out of, or in connection with any Transaction contemplated by the engagement letter of which this Annex A is a part or the engagement of Merrill Lynch pursuant
thereto, and the performance by Merrill Lynch of the services contemplated thereby, and will reimburse each Indemnified Party for all expenses (including counsel fees and expenses) as they are incurred in connection with the investigation of,
preparation for or defense of any pending or threatened claim or any action or proceeding arising therefrom, whether or not such Indemnified Party is a party and whether or not such claim, action or proceeding is initiated or brought by or on behalf
of the Company or any Controlled Subsidiary. The Company and the Controlled Subsidiaries will not be liable under the foregoing to the extent that any loss, claim, damage, liability or expense is found in a final judgment by a court of competent
jurisdiction to have resulted from Merrill Lynch’s bad faith or gross negligence. 
  
 Each of the Company and the Controlled Subsidiaries also agrees that no Indemnified Party shall have any liability (whether direct or indirect, in contract or tort or otherwise) to the Company or the Controlled
Subsidiaries or their security holders or creditors related to, arising out of, or in connection with, any Transaction, the engagement of Merrill Lynch pursuant to, or the performance by Merrill Lynch of the services contemplated by, the engagement
letter except to the extent that any loss, claim, damage or liability is found in a final judgment by a court of competent jurisdiction to have resulted from Merrill Lynch’s bad faith or gross negligence. 
  
 If the indemnification of an Indemnified Party provided for in this letter
agreement is for any reason held unenforceable, although otherwise applicable in accordance with its terms, the Company and each Controlled Subsidiary, jointly and severally, agree to contribute to the losses, claims, damages and liabilities for
which such indemnification is held unenforceable (i) in such proportion as is appropriate to reflect the relative benefits to the Company and the Controlled Subsidiaries, on the one hand, and Merrill Lynch, on the other hand, of any contemplated
Transaction (whether or not such Transaction is consummated) or (ii) if (but only if) the allocation provided for in clause (i) is for any reason held unenforceable, in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) but also the relative fault of the Company and the Controlled Subsidiaries, on the one hand, and Merrill Lynch, on the other hand, as well as any other relevant equitable considerations. Each of the Company and the
Controlled Subsidiaries agrees that for the purposes of this paragraph the relative benefits to the Company and the Controlled Subsidiaries and Merrill Lynch of any contemplated Transaction (whether or not such Transaction is consummated) shall be
deemed to be in the same proportion that the total value received or contemplated to be received by the Company or the Controlled Subsidiaries or their security holders or the total value paid or contemplated to be paid by the Company and the
Controlled Subsidiaries, as the case may be, as a result of or in connection with the Transaction bears to the fees paid or to be paid to Merrill Lynch under this letter agreement; provided, however, that, to the extent permitted by
applicable law, in no event shall the Indemnified Parties be required to contribute an aggregate amount in excess of the aggregate fees actually paid to Merrill Lynch under the engagement letter of which this Annex A is a part. 
  
 Each of the Company and the Controlled Subsidiaries agrees that it will not,
without the prior written consent of Merrill Lynch, settle, compromise or consent to the entry of any judgment in any pending or threatened claim, action or proceeding in respect of which indemnification could be sought under this letter agreement
(whether or not Merrill Lynch or any other Indemnified Party is an actual or potential party to such claim, action or proceeding), unless such settlement, compromise or consent includes an unconditional release of each Indemnified Party from all
liability arising out of such claim, action or proceeding. 
  
 If
Merrill Lynch or any other Indemnified Party is requested or required to appear as a witness in any action brought by or on behalf of or against the Company, any Controlled Subsidiary or a Purchaser in which such party is not named as a defendant,
the Company and each Controlled Subsidiary, jointly and severally, agree to reimburse Merrill Lynch for all expenses incurred in connection with such party’s appearing and preparing to appear as such a witness, including, without limitation,
the fees and disbursements of its legal counsel. 
  
 The
provisions of this Annex A shall continue to apply and shall remain in full force and effect regardless of any modification or termination of the engagement or engagement letter of which this Annex A is a part or the completion of Merrill
Lynch’s services hereunder. 
  

 8 

 ANNEX B 
  
 Debt Obligations 
  
 J.P. Morgan Credit Facility 
  
 Evergreen Credit Agreement 
  
 10% Senior Notes
due 2007 
  
 10-1/8% Senior Notes due 2010 
  
 9.80% Senior Discount Notes due 2008 
  
 11% Senior Discount Notes due 2008 
  
 11-1/8% Senior Discount Notes due 2007 
  

 9

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