EXHIBIT 10.6
OVS AGREEMENT
-------------
RCN Telecom Services, Inc. ("RCN") and MFS Communications
Company, Inc. ("MFS") hereby agree as follows:
1. VDT Services Agreement. On October 9, 1995, MFS and RCN
entered into a certain letter agreement (the "VDT Services Agreement")
respecting the provision by MFS (or its affiliates) to RCN (or its affiliates)
of video dialtone common carrier capacity (the "VDT Services") in Boston,
Massachusetts. Upon implementation by RCN of an open video system to
distribute video programming services over the Dedicated Fibers, the VDT
Services Agreement will be terminated.
2. IRU Agreements. Contemporaneously herewith affiliates of
MFS, as grantors, and affiliates of RCN, as users, have entered into two dark
fiber IRU agreements (the "IRU Agreements") respecting certain fibers
("Dedicated Fibers") in Boston, Massachusetts and in the Borough of Manhattan,
New York, New York (the "Service Areas"). The affiliates of RCN may use the
Dedicated Fibers provided under the IRU Agreements solely for the purposes of
providing video programming services to end-user retail customers pursuant to
the VDT Services Agreement or, upon implementation by RCN (or its affiliates)
of an open video system, as part of such open video system, and telephony and
data services to residential end-user retail customers.
3. RCN OVS Certification. On or about February 27, 1997, the
Federal Communications Commission ("FCC") granted OVS Certificates to
affiliates of RCN covering the Service Areas. On or about February 28, 1997,
RCN filed with the FCC Notices of Intent of establish open video systems in the
Service Areas, and RCN and its affiliates will use their best efforts to
implement open video systems in the Service Areas on June 2, 1997 or as soon
as practicable after that date.
4. MFS OVS Certification. On or about December 9, 1995, the FCC
granted a certificate to affiliates of MFS for the operation of an open video
system covering the Service Areas ("OVS Certificate"). MFS agrees to
cooperate with RCN and use its reasonable good faith efforts (including
requests for extensions), so that the OVS Certificate of MFS would not be
withdrawn or canceled until (a) the date RCN (or its affiliates) becomes
certified to and implements OVS service, (b) the receipt of a final order or
directive of any federal, state or local regulatory authority prohibiting this
Agreement or canceling or terminating the OVS certificate of MFS, or (c) the
expiration or earlier termination of the IRU Agreement in the applicable
Service Area, or (d) December 31, 1997; provided, and notwithstanding anything
contained herein to the contrary, in no event shall MFS be required to file a
notice of intent to provide OVS Service, be required to request any extension
of its OVS Certificate beyond December 31, 1997, or be responsible or liable
in any manner if any request for extension by MFS is denied.
5. Consideration. RCN shall be responsible, and shall reimburse
MFS, for any obligations of whatever nature imposed upon MFS (or its
affiliates) as a common carrier provider or otherwise respecting RCN's
provision of video services. In addition, in the event RCN does not become
certified to and does not implement OVS Service prior to December 31, 1997,
RCN agrees to pay MFS consideration equal to fifteen percent (15%) of the
gross video receipts of RCN (or RCN's affiliates) in the Service Areas from
and after the date MFS (or its affiliates) first provided VDT Service to RCN
in the Service Areas.
6. Regulatory Risk. All regulatory risk associated with the
providing of video services by RCN shall be borne by RCN. Without limiting the
foregoing, RCN shall be fully responsible for obtaining all regulatory
operating authorities relating to either OVS Service or VDT Services and RCN
hereby indemnifies and agrees to hold harmless MFS (and its affiliates) from
all consequences of any final regulatory determination which is unfavorable to
RCN, RCN's affiliates or customers of RCN or its affiliates, or adverse to the
interests of MFS or its affiliates.
7. Binding Effect. This agreement shall be binding upon or
inure to the benefit of the parties hereto and their respective successors and
assigns.
DATED: May 8, 1997.
RCN TELECOM SERVICES, INC.
By /s/ ▇▇▇▇ Hobat
-----------------------------
Title: President
MFS COMMUNICATION COMPANY, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------
Title: EXECUTIVE VICE
PRESIDENT