11. Management Services Agreement
On September 14, 2009, a majority investor of the Company acquired a majority interest in Grande Communications Networks, LLC ("Grande"), a retail and wholesale provider of cable video programming, high speed data, telephony and other advanced broadband services. Concurrent with this acquisition, the Company entered into a Management Services Agreement (the "Agreement") with Grande and Grande Manager LLC to provide management and other services to Grande. Under the terms of the Agreement, designated personnel of the Company will provide general managerial oversight and such management services as mutually agreed upon by and between the Company and Grande with respect to the business and operations of Grande, subject to the authority of Grande's board of directors. In consideration for the Company providing such services, Grande agreed to pay to the Company on a quarterly basis a fee equal to the lesser of 50% of the quarterly expenses associated with the designated Company personnel providing managerial services to Grande, or 5.5% of Grande's total quarterly revenue less certain expenses as further described in the Agreement (the "Management Fee"). The Management Fee contemplates the recovery of costs to provide managerial services and may not be indicative of the service fee charged by an independent party. The Agreement commenced upon execution and will terminate upon certain events specified within the Agreement, or as mutually agreed upon by the Company and Grande. Any Management Fee earned by the Company will reduce the related selling, general and administrative expense during the period recognized. $1,783 and $1,705 in Management Fees were recorded during the years ended December 31, 2011 and 2010, respectively. Additionally, the Company had a receivable from Grande of $566, $593 and $556 as of December 31, 2011, 2010 and 2009, respectively.