Exodus "locking down" customer gear due to bankruptcy?
I've heard anecdotal evidence that Exodus has a clause buried in at least some of their contracts that effectively prohibits the customer from removing their equipment from their facilities in the event of bankruptcy. Not the customer filing Ch. 7/11, but EXODUS going bankrupt. Furthermore, it appears that as they have indeed filed Chapter 11, they are actively enforcing this, at least at their Northern Virginia facility. Has anyone else heard of this or been affected by this? Exodus customers, can any of you look up your contracts and see if you can dig this up? I'm interested in hearing the exact language, if it is indeed a standard clause...I'm thinking there's no way that this could be enforceable, although it would probably take a TRO to get them to let customers claim their gear. -Chris --------------------------- Christopher A. Woodfield rekoil@semihuman.com PGP Public Key: http://pgp.mit.edu:11371/pks/lookup?op=get&search=0xB887618B
I've heard anecdotal evidence that Exodus has a clause buried in at least some of their contracts that effectively prohibits the customer from removing their equipment from their facilities in the event of bankruptcy. Not the customer filing Ch. 7/11, but EXODUS going bankrupt. Furthermore, it appears that as they have indeed filed Chapter 11, they are actively enforcing this, at least at their Northern Virginia facility.
I think you'd find that your anecdotal evidence is coming from sources who don't read their contracts very carefully. Unless _I_ am not reading correctly, the clause to which you refer, at least in our contract with Exodus, reads that either side can terminate the contract if the other side enters voluntary bankrupcy proceedings. (actual language sent in private e-mail)
Has anyone else heard of this or been affected by this? Exodus customers, can any of you look up your contracts and see if you can dig this up? I'm interested in hearing the exact language, if it is indeed a standard clause...I'm thinking there's no way that this could be enforceable, although it would probably take a TRO to get them to let customers claim their gear.
Perhaps your sources are confused by changed procedures; in Boston I've seen signs posted that equipment can no longer be carried in or out via the lobby area, and must traverse the shipping & receiving area, but no evidence of customers being prevented from leaving; in fact, I'm pretty certain that there's no such restriction being enforced. While it may not have been your intent, this reads to me as "run away, Exodus is trying to screw you!" I sincerely doubt that this is the case, and know that I, for one, will continue doing business with Exodus in the hopes that they will come out of bankrupcy proceedings soon, and continuing to provide some of the best colocation services out there. Tim ObDisclaimer: I'm in no way affiliated with Exodus other than by being a customer. -- Tim Wilde twilde@dyndns.org Systems Administrator Dynamic DNS Network Services http://www.dyndns.org/
No, it was because it sounded so far-fetched to me that I couldn't help but post to see if anyone else other than the parties who relayed the info to me knows anything about this. However, the affected party who prompted my post is sufficiently unable to claim their equipment that they're buying new hardware to replace the gear that they "lost" to Exodus. And unless someone's lying to me, they're not delinquent. -C
While it may not have been your intent, this reads to me as "run away, Exodus is trying to screw you!" I sincerely doubt that this is the case, and know that I, for one, will continue doing business with Exodus in the hopes that they will come out of bankrupcy proceedings soon, and continuing to provide some of the best colocation services out there.
Tim
ObDisclaimer: I'm in no way affiliated with Exodus other than by being a customer.
-- Tim Wilde twilde@dyndns.org Systems Administrator Dynamic DNS Network Services http://www.dyndns.org/
-- --------------------------- Christopher A. Woodfield rekoil@semihuman.com PGP Public Key: http://pgp.mit.edu:11371/pks/lookup?op=get&search=0xB887618B
I've heard anecdotal evidence that Exodus has a clause buried in at least some of their contracts that effectively prohibits the customer from removing their equipment from their facilities in the event of bankruptcy. Not the customer filing Ch. 7/11, but EXODUS going bankrupt. Furthermore, it appears that as they have indeed filed Chapter 11, they are actively enforcing this, at least at their Northern Virginia facility.
They can state that even if they file for bankruptcy, the contract is valid. Because you're a tenant and they're a landlord (in strict legal sense) they can prohibit you from moving your equipment by having an effective lien on the assets you store there in the amount of the remaining value of the contract. That is rarely done, and I think the follow-up posts have shown that EXDS isn't one of them.
Has anyone else heard of this or been affected by this? Exodus customers, can any of you look up your contracts and see if you can dig this up? I'm interested in hearing the exact language, if it is indeed a standard clause...I'm thinking there's no way that this could be enforceable, although it would probably take a TRO to get them to let customers claim their gear.
They have a policy making it obscenely difficult to bring equipment in and remove equipment from the facility. In the N Virginia facility, I remember the pain we had to go through to bring in a replacement switch and then subsequently remove the failed one. I'd imagine that EXDS is running under heightened security after 9/11 -- though thats just a guess. I have not been into, nor had any equipment in the N Virginia facility in over a year now. Cris
"Christopher A. Woodfield" wrote:
I've heard anecdotal evidence that Exodus has a clause buried in at least some of their contracts that effectively prohibits the customer from removing their equipment from their facilities in the event of bankruptcy. Not the customer filing Ch. 7/11, but EXODUS going bankrupt. Furthermore, it appears that as they have indeed filed Chapter 11, they are actively enforcing this, at least at their Northern Virginia facility.
Has anyone else heard of this or been affected by this? Exodus customers, can any of you look up your contracts and see if you can dig this up? I'm interested in hearing the exact language, if it is indeed a standard clause...I'm thinking there's no way that this could be enforceable, although it would probably take a TRO to get them to let customers claim their gear.
-Chris
Having personal experience with a facilities-based providers' bankruptcy, I can say that generally an asset management company becomes involved, and from that point forward the company has very strict asset tracking measures in place. Exodus will probably not limit what can be removed, but they will surely extensively document the removal of equipment (probably more carefully than before) ... which, at first glance, might look as if they're trying to prohibit the removal of equipment. Grant -- Grant A. Kirkwood - grant@virtical.net Chief Technology Officer - Virtical Solutions, Inc. http://www.virtical.net/
On Mon, 1 Oct 2001, Grant A. Kirkwood wrote:
Having personal experience with a facilities-based providers' bankruptcy, I can say that generally an asset management company becomes involved
Which means they have to do a very careful inventory of all of EXODUS's assets. But a server owned by me, colo'd at Exodus, isn't an Exodus asset. Your explanation sounds a lot more logical than the original assumption. -- JustThe.net LLC - Steve "Web Dude" Sobol, CTO - sjsobol@JustThe.net Donate a portion of your monthly ISP bill to your favorite charity or non-profit organization! E-mail me for details.
Also sprach Steven J. Sobol
On Mon, 1 Oct 2001, Grant A. Kirkwood wrote:
Having personal experience with a facilities-based providers' bankruptcy, I can say that generally an asset management company becomes involved
Which means they have to do a very careful inventory of all of EXODUS's assets. But a server owned by me, colo'd at Exodus, isn't an Exodus asset.
Your explanation sounds a lot more logical than the original assumption.
I can say that shortly after ICG went into Chapter 11, I went to retrieve some equipment from one of their co-lo's and was prevented from entering until the person there "checked some things out." I never did find out what they were checking out, and I was allowed to get my equipment, but it certainly seemed like I was about to be prevented from doing so for a little bit. FWIW. -- Jeff McAdams Email: jeffm@iglou.com Head Network Administrator Voice: (502) 966-3848 IgLou Internet Services (800) 436-4456
On Tue, Oct 02, 2001 at 09:13:56PM -0400, Jeff Mcadams wrote:
I can say that shortly after ICG went into Chapter 11, I went to retrieve some equipment from one of their co-lo's and was prevented from
I just completed the retrieval of several pieces of equipment from one of their co-lo facilities. We had absolutely no problems; we were asked to complete an asset tracking form, and then a tech was asked to verify that everything we were taking out was accounted for on the form. No big deal, only took a few minutes. YMMV. -- Edward S. Marshall <esm@logic.net> http://esm.logic.net/ ------------------------------------------------------------------------------- [ Felix qui potuit rerum cognoscere causas. ]
Also sprach Edward S. Marshall
On Tue, Oct 02, 2001 at 09:13:56PM -0400, Jeff Mcadams wrote:
I can say that shortly after ICG went into Chapter 11, I went to retrieve some equipment from one of their co-lo's and was prevented from
I just completed the retrieval of several pieces of equipment from one of their co-lo facilities. We had absolutely no problems; we were asked to complete an asset tracking form, and then a tech was asked to verify that everything we were taking out was accounted for on the form. No big deal, only took a few minutes. YMMV.
Hrmm...OK...my experience was right after they filed (our move had already been planned before they filed), so they may not have been organized along those lines yet. :) -- Jeff McAdams Email: jeffm@iglou.com Head Network Administrator Voice: (502) 966-3848 IgLou Internet Services (800) 436-4456
[snip]
Which means they have to do a very careful inventory of all of EXODUS's assets. But a server owned by me, colo'd at Exodus, isn't an Exodus asset.
No, but their receivables are and they are technically a landlord. They have what is considered a landlord's lien in many states, whether or not the contract specifically provides for one. If the state that the server is in has such legislation, that equipment is essebtuakky a substitutable asset in place of your delinquent receivables. Companies typically only care to enforce provisos like that when accounts are tremendously past due OR when the landlord (EXDS here) is in financial trouble and knows every penny counts.
On Tue, 2 Oct 2001, Cristopher Daniluk wrote:
No, but their receivables are and they are technically a landlord.
Right, I understand. My former employer had to negotiate an agreement with his landlord in order to offer colo services because colo providers effectively are subletting space. But assuming I'm paid up per the terms of the colo contract, can the bankruptcy court or their agent take my servers because my landlord went bankrupt with X number of months left on my contract? Every lease I've signed, whether for an apartment or office space, provides that I owe the landlord $X where $X is the product of monthly rent x contract term in months. So, I pay the balance down to zero but before the last month I still have an outstanding balance. But does that apply to colo contracts too?
If the state that the server is in has such legislation, that equipment is essentially a substitutable asset in place of your delinquent receivables.
If I'm delinquent. What if I'm paid up and current? Just curious, and not expecting a *specific* answer, S -- JustThe.net LLC - Steve "Web Dude" Sobol, CTO - sjsobol@JustThe.net Donate a portion of your monthly ISP bill to your favorite charity or non-profit organization! E-mail me for details.
[snip]
My former employer had to negotiate an agreement with his landlord in order to offer colo services because colo providers effectively are subletting space.
Yep. Another weird implication of this is that putting leased equipment in a colo facility technically requires some special attention to ensure property insurance requirements are met. We had a problem with that before where the particular leasor had never dealt with colocation situations before and thought it was "insane" we were putting our equipment on someone else's property.
But assuming I'm paid up per the terms of the colo contract, can the bankruptcy court or their agent take my servers because my landlord went bankrupt with X number of months left on my contract?
Nope. If the landlord defaults in a manner where they will suspend operations, they're failing to fulfill the terms of the contract and thus, as a tenant, you can't be liable for an amount larger than your current balance. At least, not as a general rule :)
Every lease I've signed, whether for an apartment or office space, provides that I owe the landlord $X where $X is the product of monthly rent x contract term in months. So, I pay the balance down to zero but before the last month I still have an outstanding balance. But does that apply to colo contracts too?
Sure, but potential liens would only apply to past due balances. Unposted balances that you're talking about aren't past due, so they couldn't restrict your access on that basis to my knowledge.
If the state that the server is in has such legislation, that equipment is essentially a substitutable asset in place of your ^^^^^^^^^^^ Believe it or not, that is essentially
participants (7)
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Christopher A. Woodfield -
Cristopher Daniluk -
Edward S. Marshall -
Grant A. Kirkwood -
Jeff Mcadams -
Steven J. Sobol -
Tim Wilde