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EXHIBIT 10.4
CORPORATE OVERHEAD ALLOCATION AGREEMENT
dated as of
among
(PTK Companies)
A
and
B
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CORPORATE OVERHEAD ALLOCATION AGREEMENT ("Agreement") dated as of
January 1, 1996 among [PTK Companies] B and A
WHEREAS, (collectively the "PTK Companies") are currently engaged in
the construction, development, operation and management of cable communications
systems in different cities/areas within the Republic of Poland;
WHEREAS, (collectively the "PTK Companies") are either affiliates or
majority owned subsidiaries of B , a majority owned subsidiary of A ;
WHEREAS, each of the PTK Companies has engaged B or A or their
affiliates to perform certain services on a non-exclusive basis relating to the
construction, development, operation and management assistance of cable
television facilities through individual Service Agreements with A or B ;
WHEREAS, one or more of the PTK Companies are performing certain other
services in Poland for the benefit of some or all of the PTK Companies; and
WHEREAS, the parties need to clarify certain aspects of the Service
Agreement and the allocation of other such shared costs;
NOW, THEREFORE, in consideration of the premises and mutual promises
and covenants hereinafter set forth, the parties agree with each other as
follows:
ARTICLE 1
THE PARTIES
Section 1.1 Names of the Parties.
The parties to this Agreement are B ; and A, and any future affiliates
that may become a party to this agreement.
Section 1.2 Description of the Parties.
(a) (i) [PTK Company] is a ______________________ formed
under the Polish Commercial Code of Poland with a principal office
at ________________________________.
(ii) [PTK Company] is a ______________________ formed
under the Polish Commercial Code of Poland with a principal office
at ________________________________.
(iii) [PTK Company] is a ______________________ formed
under the Polish Commercial Code of Poland with a principal office
at _______________________________.
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(iv) [PTK Company] is a _______________________ formed
under the Polish Commercial Code of Poland with a principal office
at _______________________________.
(v) [PTK Company] is a _______________________ formed
under the Polish Commercial Code of Poland with a principal office
at _______________________________.
(vi) [PTK Company] is a _______________________ formed
under the Polish Commercial Code of Poland with a principal office
at _______________________________.
(vii) [PTK Company] is a _______________________ formed
under the Polish Commercial Code of Poland with a principal office
at _______________________________.
(viii) [PTK Company] is a _______________________ formed
under the Polish Commercial Code of Poland with a principal office
at _______________________________.
The companies set forth in (i) to (viii) above are collectively
referred to as the "PTK Companies", or individually as a "PTK Company". Any
entities which are formed or acquired by any of the parties to this agreement
subsequent to the execution of this Agreement may become a party to this
Agreement by execution of a separate letter or agreement to be bound by the
terms contain herein.
(b) A is a ______________________. It is referred to below
as " A ".
(c) B is a ______________________. It is referred to below
as " B ".
ARTICLE 2
THE SYSTEMS
Section 2.1 The Systems.
The PTK Companies have been authorized to construct, own and
operate cable television systems in the Republic of Poland. The
cable systems are referred to as the "Systems".
Section 2.2 The Business of the PTK Companies.
The existing business of the PTK Companies is to construct, acquire,
own and operate cable television systems, to service areas in the Republic of
Poland. The business of the PTK Companies includes the construction, development
and promotion of the Systems
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in various cities in the Republic of Poland, the purchase of equipment,
supplies, and other goods and materials for the Systems, the operation and
maintenance of the Systems and managing personnel needed to carry out its
business goals and objectives and all other functions relating to the successful
operation of a cable television system.
ARTICLE 3
COSTS
Section 3.1 Services and Costs of A and/or B .
(a) Hartford Costs: A shall (or may cause B or affiliates,
in its sole discretion) provide services on behalf of, and at the request of,
the PTK Companies under the Service Agreements and management related services
and overhead costs as otherwise requested by the PTK Companies. The costs
associated with such services are called "Hartford Costs".
(b) Allocation of Hartford Costs
(i) Those Hartford Costs that can be clearly and directly attributed to
or for the benefit of specific PTK Companies shall be allocated and charged only
to those particular PTK Companies.
(ii) Those Hartford Costs that are not clearly and directly attributed
to or for the benefit of specific PTK Companies shall be allocated equally among
each of the PTK Companies, provided on Schedule A, as such schedule shall be
amended from time to time by A in its sole discretion.
(iii) A and/or B shall determine the allocations in 3.1(b)(i) and (ii)
above as described on Schedule A, and the PTK Companies agree to be bound by
such allocations.
(c) Billing: The PTK Companies shall be invoiced on a quarterly basis
in arrears, and the PTK Companies shall each agree to make payment to the
designated party on a timely basis in accordance with the terms of the invoice.
3.2 Services and Costs of PTK - Warsaw
(a) Poland Corporate Overhead Costs: At times certain PTK Company(ies)
shall perform certain services and maintain certain equipment and materials
which benefit all or some of the PTK Companies. Such services and expenses
include costs associated with maintaining a central office in Warsaw (including
but not limited to office equipment and telephone); legal expenses; expenses
relating to governmental relationships and approvals; programming services;
accounting; MIS services; and certain
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personnel whose duties clearly benefit more than just the PTK Company(ies)
performing the services and those incurring the costs. These costs are called
the "Poland Corporate Overhead Costs".
(b) Allocation of Poland Corporate Overhead Costs:
The Poland Corporate Overhead Costs shall be calculated and
allocated as follows:
(i) On a quarterly basis, each of the PTK Companies shall
submit to A or B (as designated by A ) a statement of any Poland Corporate
Overhead Costs it has incurred. Such statement shall describe the nature and
dates of the Poland Corporate Overhead Costs and the PTK Company(ies) on whose
behalf such costs were incurred.
(ii) A or B shall review the statement to determine the
appropriate Poland Corporate Overhead Costs to be allocated among the PTK
Companies.
(iii) A or B shall invoice the PTK Companies for their equal
pro rata share as set forth in Schedule A (based upon the number of PTK
Companies) of the Poland Corporate Overhead Costs, collect the net amounts due
and owing and reimburse the PTK Companies pursuant to the appropriate
allocation.
(c) Billing: The PTK Companies shall be invoiced on a quarterly basis
in arrears, and the PTK Companies shall each agree to make payment to the
designated party on a timely basis in accordance with the terms of the invoice.
(d) Resolution of Disputes: If any PTK Company has a dispute regarding
any Poland Corporate Overhead Costs allocated to it or due it under this
Agreement, it shall notify A in writing within fifteen (15) business days after
receipt of such invoice.
The parties shall then use their best efforts to resolve such
disputes. If no settlement is reached within thirty (30) days, parties hereby
agree to submit to arbitration under Section 5.4 of this Agreement.
Section 3.3 Consent
(a) The parties to this agreement understand that
consummated a loan with The parties agree and consent that
no allocation of Poland Corporate Overhead Costs to shall exceed its equal
pro rata share, as set forth on Schedule A attached, unless and until OPIC has
consented in writing to such allocation. [NOW VOID]
ARTICLE 4
TERM AND TERMINATION
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Section 4.1 Term
This Agreement shall commence on _____________________ and shall remain
in effect until __________________. This Agreement shall automatically renew for
successive one (1) year periods unless written notice is given at least thirty
(30) days prior to the end of the Term and sent by A or B to one or more of the
PTK Companies or by one or more of the PTK Companies to A and B , such
termination to be effective on the last day of the then existing term. If any of
the PTK Companies terminates this Agreement, the termination shall be effective
only for the specific PTK Company giving notice of termination.
Section 4.2 Termination
Notwithstanding the provisions of 4.1 above, at any time during this
Agreement, any party may terminate this Agreement by giving 30 days prior
written notice. If any of the PTK Companies terminates this Agreement, the
termination shall be effective as to only those PTK Companies giving notice of
termination.
Upon termination of the Agreement by any of the PTK Companies for any
reason, any costs incurred after termination subject to this Agreement shall be
reallocated pursuant to the provisions of this Agreement.
ARTICLE 5
MISCELLANEOUS PROVISIONS
Section 5.1 Governing Law
This Agreement shall be governed in accordance with the laws of the
State of Connecticut.
Section 5.2 Binding Effect
This Agreement shall be binding on and inure to the parties' successors
and assigns.
Section 5.3 Notices
Notices given under this Agreement shall be valid only if in writing
and properly mailed. A notice shall be properly mailed only if delivered by
overnight courier, with signature required, or if mailed by certified or
registered mailed, if postage is prepaid, and if the notice is properly
addressed. A notice to a party shall be properly addressed only if addressed to
the address of the party
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set forth in Section 1.2 or to any other address the party may designate by
giving notice to the other parties.
Section 5.4 Disputes
Any dispute arising under this Agreement shall be resolved by
arbitration by a board of three arbitrators, one to be designated by the PTK
Company(ies) involved in the dispute, one to be designated by A or B , and the
third to be designated by the first two arbitrators. The board of arbitrators
shall adopt procedures for the arbitration and, for this purpose, may adopt some
or all of the rules and regulations of the American Arbitration Association. The
cost of any arbitration shall be borne equally by the parties. The decision of
the board shall be final and unappealable.
To signify their agreement to the foregoing, the parties hereto have
caused this Agreement to be executed by their duly authorized representatives.
[PTK Companies]
By:
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Its:
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A
By:
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Its:
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B
By:
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Its:
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Schedule A
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A
Date
Re: Corporate Overhead Allocation Agreement dated as of January 1,
1996
Gentlemen:
This letter is in reference to a certain Corporate Overhead Allocation Agreement
("1996 Corporate Overhead Allocation Agreement") dated as of January 1, 1996
among (collectively the "PTK Companies"), A , and B .
Unless otherwise defined herein, all capitalized terms have the same meaning as
defined in the 1996 Corporate Overhead Allocation Agreement.
Effective , C is entering into a Service Agreement with A and
B . In connection with that agreement, C agrees to become a party to the 1996
Corporate Overhead Allocation Agreement as a PTK Company and to abide by all the
terms and conditions as stated herein.
Effective , Schedule A of the 1996 Corporate Overhead Allocation
Agreement shall be replaced with the Schedule A attached to this letter,
evidencing C participation as a PTK Company. A shall be responsible for
distributing revised Schedule A to the remaining PTK Companies.
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To signify C understanding and acceptance of the terms as stated herein, please
sign in the space indicated below.
Very truly yours,
A
By:
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Its:
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Acknowledged & Accepted:
C
By:
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Its:
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B
By:
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Its:
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Revised - Schedule A