FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 10, 2001
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CHARTER COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or Other Jurisdiction of Incorporation or Organization)
000-27927 43-1857213
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Commission File Number (Federal Employer
Identification Number)
12444 Powerscourt Drive - Suite 400
St. Louis, Missouri 63131
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(Address of Principal Executive Offices) (Zip Code)
(Registrant's telephone number, including area code) (314) 965-0555
Item 5. Other Items.
On May 30, 2001, Charter Communications, Inc. announced the closing
of the sale of 60,247,350 shares of its Class A common stock, and the closing of
the sale of $632.5 million of Convertible Senior Notes due 2006. A copy of the
press release relating to these transactions is being filed as Exhibit 99.1 with
this report. The Underwriting Agreements and the Indenture are also filed as
exhibits.
On May 10, 2001, Charter Communications Holdings, LLC and Charter
Communications Holdings Capital Corporation announced that they had entered into
an agreement to sell $350 million of 9.625% Senior Notes due 2009, $575 million
of 10% Senior Notes due 2011 and $1.02 billion of 11.750% Senior Discount Notes
due 2011. A copy of the press release relating to the sale of these notes is
being filed as Exhibit 99.2 with this report. The Purchase Agreement, the
Indentures and the Exchange and Registration Agreements are also filed as
exhibits.
Item 7. Exhibits
Press release dated May 30, 2001.*
Press release dated May 10, 2001.*
Underwriting Agreement, relating to 4.75% Convertible Senior Notes
due 2006 dated May 23, 2001.*
Indenture dated May 30, 2001 between Charter Communications, Inc. and
BNY Midwest Trust Company as Trustee governing 4.75% Convertible
Senior Notes due 2006.*
Underwriting Agreement relating to Class A common stock dated May 23,
2001.*
Purchase Agreement relating to 9.625% Senior Notes due 2009, 10.000%
Senior Notes due 2011, 11.750% Senior Discount Notes due 2011 dated
May 10, 2001.*
Indenture dated as of May 15, 2001 between Charter Communications
Holdings, LLC, Charter Communications Holdings Capital Corporation
and BNY Midwest Trust Company as Trustee governing 9.625% Senior
Notes due 2009.*
Exchange and Registration Rights Agreement relating to 9.625% Senior
Notes due 2009, dated as of May 15, 2001, among Charter
Communications Holding Company, LLC, Charter Communications Capital
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated,
Banc of America Securities LLC, Bear, Stearns & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc., JP Morgan, a Division of Chase Securities Inc., Credit Lyonnais
Securities (USA) Inc., Fleet Securities, Inc., BMO Nesbitt Burns
Corp. and Dresdner Kleinwort Wasserstein Securities LLC. *
Indenture dated as of May 15, 2001 between Charter Communications
Holdings, LLC, Charter Communications Holdings Capital Corporation
and BNY Midwest Trust Company as Trustee governing 10.000% Senior
Notes due 2011.*
Exchange and Registration Rights Agreement relating to 10.000% Senior
Notes due 2011, dated as of May 15, 2001, among Charter
Communications Holding Company, LLC, Charter Communications Capital
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated,
Banc of America Securities LLC, Bear, Stearns & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc., JP Morgan, a Division of Chase Securities Inc., Credit Lyonnais
Securities (USA) Inc., Fleet Securities, Inc., BMO Nesbitt Burns
Corp. and Dresdner Kleinwort Wasserstein Securities LLC.*
Indenture dated as of May 15, 2001 between Charter Communications
Holdings, LLC, Charter Communications Holdings Capital Corporation
and BNY Midwest Trust Company as Trustee governing 11.750% Senior
Discount Notes due 2011.*
Exchange and Registration Rights Agreement relating to 11.750% Senior
Discount Notes due 2011, dated as of May 15, 2001, among Charter
Communications Holding Company, LLC, Charter Communications Capital
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated,
Banc of America Securities LLC, Bear, Stearns & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc., JP Morgan, a Division of Chase Securities Inc., Credit Lyonnais
Securities (USA) Inc., Fleet Securities, Inc., BMO Nesbitt Burns
Corp. and Dresdner Kleinwort Wasserstein Securities LLC.*
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* filed herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Charter Communications, Inc. has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
CHARTER COMMUNICATIONS, INC.,
a registrant
Dated May 31, 2001 By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
Exhibit Index
Exhibit
Number Description
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4.1(a) Underwriting Agreement, relating to 4.75% Convertible Senior Notes
due 2006 dated May 23, 2001.
4.1(b) Indenture dated May 30, 2001 between Charter Communications, Inc. and
BNY Midwest Trust Company as Trustee governing 4.75% Convertible
Senior Notes due 2006.
4.2 Underwriting Agreement relating to Class A common stock dated May 23,
2001.
10.1 Purchase Agreement relating to 9.625% Senior Notes due 2009, 10.000%
Senior Notes due 2011, 11.750% Senior Discount Notes due 2011 dated
May 10, 2001.
10.2(a) Indenture dated as of May 15, 2001 between Charter Communications
Holdings, LLC, Charter Communications Holdings Capital Corporation
and BNY Midwest Trust Company as Trustee governing 9.625% Senior
Notes due 2009.
10.2(b) Exchange and Registration Rights Agreement relating to 9.625% Senior
Notes due 2009, dated as of May 15, 2001, among Charter
Communications Holding Company, LLC, Charter Communications Capital
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated,
Banc of America Securities LLC, Bear, Stearns & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc., JP Morgan, a Division of Chase Securities Inc., Credit Lyonnais
Securities (USA) Inc., Fleet Securities, Inc., BMO Nesbitt Burns
Corp. and Dresdner Kleinwort Wasserstein Securities LLC.
10.3(a) Indenture dated as of May 15, 2001 between Charter Communications
Holdings, LLC, Charter Communications Holdings Capital Corporation
and BNY Midwest Trust Company as Trustee governing 10.000% Senior
Notes due 2011.
10.3(b) Exchange and Registration Rights Agreement relating to 10.000% Senior
Notes due 2011, dated as of May 15, 2001, among Charter
Communications Holding Company, LLC, Charter Communications Capital
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated,
Banc of America Securities LLC, Bear, Stearns & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc., JP Morgan, a Division of Chase Securities Inc., Credit Lyonnais
Securities (USA) Inc., Fleet Securities, Inc., BMO Nesbitt Burns
Corp. and Dresdner Kleinwort Wasserstein Securities LLC.
10.4(a) Indenture dated as of May 15, 2001 between Charter Communications
Holdings, LLC, Charter Communications Holdings Capital Corporation
and BNY Midwest Trust Company as Trustee governing 11.750% Senior
Discount Notes due 2011.
10.4(b) Exchange and Registration Rights Agreement relating to 11.750% Senior
Discount Notes due 2011, dated as of May 15, 2001, among Charter
Communications Holding Company, LLC, Charter Communications Capital
Corporation, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated,
Banc of America Securities LLC, Bear, Stearns & Co. Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney
Inc., JP Morgan, a Division of Chase Securities Inc., Credit Lyonnais
Securities (USA) Inc., Fleet Securities, Inc., BMO Nesbitt Burns
Corp. and Dresdner Kleinwort Wasserstein Securities LLC.
99.1 Press release dated May 30, 2001.
99.2 Press release dated May 10, 2001.
Charter Communications, Inc.
4.75% Convertible Senior Notes due 2006
Underwriting Agreement
May 23, 2001
Morgan Stanley & Co. Incorporated,
Goldman, Sachs & Co.,
Banc of America Securities LLC,
Bear, Stearns & Co. Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Salomon Smith Barney Inc.,
J.P. Morgan Securities Inc.,
Credit Lyonnais Securities (USA) Inc.,
Fleet Securities, Inc.,
BMO Nesbitt Burns,
Dresdner Kleinwort Wasserstein Securities LLC,
As representatives of the several Underwriters
named in Schedule I hereto (the "Representatives"),
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
Charter Communications, Inc., a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of $550,000,000 principal amount of 4.75%
Convertible Senior Notes due 2006 (the "Firm Securities") of the Company
convertible into Class A Common Stock, par value $.001 per share (the "Common
Stock"), of the Company and, at the election of the Underwriters, up to an
additional $82,500,000 aggregate principal amount of such notes (the "Optional
Securities") (the Firm Securities and the Optional Securities that the
Underwriters elect to purchase pursuant to Section 2 hereof being collectively
called the "Securities").
It is understood and agreed that Morgan Stanley & Co. Incorporated
and Goldman, Sachs & Co. are joint book-runners and joint lead managers for the
offering of the Securities and any determinations or other actions to be made
under this Agreement by you or the Representatives shall require the concurrence
of both Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co.
1. The Company and Charter Communications Holding Company, LLC, a
Delaware limited liability company ("Holding"), jointly and severally, represent
and warrant to, and agree with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-56850) and
pre-effective amendment no. 1 thereto (together, the "Initial
Registration Statement") in respect of the Securities and shares of
Common Stock issuable upon conversion thereof and the offering thereof
from time to time in accordance with Rule 415 of the rules and
regulations of the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the
"Act"), has been filed with the Commission; the Initial Registration
Statement and any post-effective amendment thereto filed with the
Commission on or before the date of this Agreement, each in the form
heretofore delivered to you, and, excluding exhibits thereto but
including all documents incorporated by reference in the prospectus
contained therein, delivered to you for each of the other
Underwriters, have been declared effective by the Commission in such
form; no other document with respect to the Initial Registration
Statement or documents incorporated by reference therein has
heretofore been filed with the Commission (other than prospectuses
filed pursuant to Rule 424(b) of the rules and regulations of the
Commission under the Act, each in the form heretofore delivered to
you); and no stop order suspending the effectiveness of the Initial
Registration Statement or any post-effective amendment thereto has
been issued and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included in
the Initial Registration Statement, filed with the Commission pursuant
to Rule 424(a) of the rules and regulations of the Commission under
the Act or that omitted information to be included upon pricing in a
form of prospectus filed with the Commission pursuant to Rule 424(b)
of the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various parts of
the Initial Registration Statement, including all exhibits thereto but
excluding Form T-1 and including the documents incorporated by
reference in the prospectus contained in the Initial Registration
Statement at the time such part of the Initial Registration Statement
became effective, each as amended at the time such part of the Initial
Registration Statement became effective and as amended by any
post-effective amendment thereto at the time such post-effective
amendment became effective, are hereinafter supplement and the final
prospectus collectively called the "Registration Statement"; the final
prospectus supplement and the final
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prospectus relating to the Securities and shares of Common Stock
issuable upon conversion thereof, in the form first filed with the
Commission pursuant to Rule 424(b) under the Act, are hereinafter
collectively called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference
in such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed
to refer to the Prospectus as amended or supplemented relating to the
Securities and shares of Common Stock issuable upon conversion thereof
in the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof, including
any documents incorporated by reference therein as of the date of such
filing).
(b) No order preventing or suspending the use of any Preliminary
Prospectus or Prospectus has been issued by the Commission, and each
Preliminary Prospectus and Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the Act and
the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the rules and regulations of the Commission thereunder and
did not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through Morgan
Stanley & Co. Incorporated and Goldman, Sachs & Co. expressly for use
therein;
(c) The documents incorporated by reference in any Preliminary
Prospectus and the Prospectus, when they became effective or were
filed with the Commission, as the case may be, conformed in all
material respects to the requirements of the Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission
thereunder, and, when such documents became effective or were filed
with the Commission, as the case may be, none of such
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documents contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and any further documents
so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(d) As of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable filing
date as to the Prospectus and any amendment or supplement thereto, the
Registration Statement and the Prospectus conform, and any further
amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the Trust Indenture Act and the rules and regulations
of the Commission thereunder and do not and will not, as of the
applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through Morgan Stanley & Co. Incorporated and
Goldman, Sachs & Co. expressly for use therein;
(e) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock,
limited liability company interests or long-term debt of the Company
or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
members' or stockholders' equity, or results of operations of the
Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus;
4
(f) Each of the Company and its subsidiaries has good and
marketable title in fee simple to all real property and good and valid
title to all personal property owned by it reflected as owned in the
financial statements or elsewhere in the Prospectus, in each case free
and clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its
subsidiaries;
(g) The Company has been duly formed and is validly existing as a
corporation in good standing under the laws of the State of Delaware;
Holding has been duly formed and is validly existing as a limited
liability company in good standing under the laws of the State of
Delaware; each of the Company and Holding has power and authority
(corporate and other) to own its properties and conduct its business
as described in the Prospectus and to execute, deliver and perform its
obligations under this Agreement, and has been duly qualified as a
foreign corporation or limited liability company, as the case may be,
for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification, and is not
subject to liability or disability by reason of the failure to be so
qualified in any such jurisdiction, except such as would not,
individually and in the aggregate, have a material adverse effect on
the current or future financial position, stockholders' or members'
equity or results of operations of the Company and its subsidiaries
taken as a whole (a "Material Adverse Effect"); each "significant
subsidiary" (as such term is defined in Rule 1-02 of Regulation S-X)
of the Company (each, a "Significant Subsidiary") has been duly
incorporated or formed, as the case may be, and is validly existing as
a corporation or limited liability company, as the case may be, in
good standing under the laws of its jurisdiction of incorporation or
formation;
(h) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable, and conform to the descriptions thereof
contained in the Prospectus; the Securities are convertible into
shares of Common Stock in accordance with the terms of the Indenture
(as hereinafter defined); the shares of Common Stock initially
issuable upon conversion of the Securities have been duly and validly
authorized and reserved for issuance and, when issued and delivered in
accordance with the provisions of the Securities and the Indenture
will be duly and validly issued,
5
fully paid and non-assessable, and will conform to the description of
the Common Stock contained in the Prospectus; the Company's
stockholders have no preemptive rights with respect to the Common
Stock; Holding has an authorized capitalization as set forth in the
Prospectus, and all of the issued and outstanding Membership Units
have been duly and validly authorized and issued, are fully paid and
non-assessable, are owned directly by the Company, Charter Investment,
Inc., Vulcan Cable III Inc. and by those other persons and entities as
described in the Prospectus, and, in the case of the Company, are
owned free and clear of all liens, encumbrances, equities or claims,
and conform to the description thereof contained in the Prospectus;
and all of the outstanding capital stock or limited liability company
interests, as the case may be, of each Significant Subsidiary of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and (except as otherwise set forth in the
Prospectus) are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(i) The Securities have been duly authorized and, when executed by
the Company and authenticated by the Trustee (as hereinafter defined)
in accordance with the provisions of the Indenture and when delivered
to, and paid for, by the Underwriters in accordance with the terms of
this Agreement, will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding
obligations of the Company entitled to the benefits provided by the
indenture to be dated as of May 30, 2001 (the "Indenture"), between
the Company and BNY Midwest Trust Company, as Trustee (the "Trustee"),
under which they are to be issued and enforceable against the Company
in accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(j) The Indenture has been duly authorized and, when executed and
delivered by the Company (and assuming the due execution and delivery
thereof by the Trustee), the Indenture will constitute a valid and
legally binding instrument, enforceable against the Company in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; the Indenture has been duly qualified under the Trust
Indenture Act; and the Indenture will conform in all material respects
to the description thereof in the Prospectus under the caption
"Description of Notes";
(k) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale
of the Securities) will violate or result in a violation of Section 7
of the Exchange Act or any regulation
6
promulgated thereunder, including, without limitation, Regulations T,
U, and X of the Board of Governors of the Federal Reserve System;
(l) Prior to the date hereof, none of the Company, any of its
subsidiaries or, to the best of the Company's knowledge, any of its
other affiliates has taken any action which is designed to or which
has constituted or which might have been expected to cause or result
in stabilization or manipulation of the price of any security of the
Company or any of its subsidiaries in connection with the offering of
the Securities;
(m) The issue and sale of the Securities hereunder and the
compliance by the Company and Holding, as the case may be, with all of
the provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein contemplated,
including the conversion of the Securities into shares of Common
Stock, will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement, lease, license,
franchise agreement, permit or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of any statute
or any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company, any of its subsidiaries
or any of their respective properties, including, without limitation,
the Communications Act of 1934, as amended, the Cable Communications
Policy Act of 1984, as amended, the Cable Television Consumer
Protection and Competition Act of 1992, as amended, and the
Telecommunications Act of 1996 (collectively, the "Cable Acts") or any
order, rule or regulation of the Federal Communications Commission
(the "FCC"), except where such conflict, breach, violation or default
would not, individually and in the aggregate, have a Material Adverse
Effect and would not have the effect of preventing the Company or
Holding from performing any of their respective obligations under this
Agreement; nor will such action result in any violation of the
restated certificate of incorporation or bylaws of the Company or the
certificate of formation or amended and restated limited liability
company agreement of Holding; and no consent, approval, authorization,
order, registration or qualification of or with any such court or
governmental agency or body is required, including, without
limitation, under the Cable Acts or any order, rule or regulation of
the FCC, for the issue and sale of the Securities, the issue and
delivery of shares of Common Stock issuable upon conversion of the
Securities or the consummation by the Company or Holding, as the case
may be, of the transactions contemplated by this Agreement or the
Indenture, except such consents, approvals, authorizations,
registrations or qualifications as have been made or except as may be
required under state or foreign securities or Blue Sky
7
laws in connection with the purchase and distribution of the
Securities by the Underwriters and except such as may be required by
the National Association of Securities Dealers, Inc. ("NASD");
(n) Neither the Company nor any of its subsidiaries is (i) in
violation of its certificate of incorporation, bylaws, certificate of
formation, limited liability company agreement or other organizational
document, as the case may be, (ii) in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement,
lease, license, permit or other agreement or instrument to which it is
a party or by which it or any of its properties may be bound or (iii)
in violation of the terms of any franchise agreement, or any law,
statute, rule or regulation or any judgment, decree or order, in any
such case, of any court or governmental or regulatory agency or other
body having jurisdiction over the Company or any of its subsidiaries
or any of their properties or assets, including, without limitation,
the Cable Acts or any order, rule or regulation of the FCC, except, in
the case of clauses (ii) and (iii), such as would not, individually
and in the aggregate, have a Material Adverse Effect;
(o) The provisions of the Company's restated certificate of
incorporation and bylaws, including, without limitation, the
provisions thereof relating to the Common Stock and the Company's
Class B Common Stock, par value .001 per share (the "Class B Stock")
(A) are lawful and permitted under the Delaware General Corporation
Law, do not violate any Delaware statute or rule or regulation of any
Delaware governmental agency or body having jurisdiction over the
Company or Holding and, subject to principles of equity, a Delaware
court properly presented with the matter would so find and (B) do not
violate any order of any Delaware court having jurisdiction over the
Company or Holding. Holding's certificate of formation and amended and
restated limited liability company agreement do not violate the
Delaware Limited Liability Company Act, Holding's amended and restated
limited liability company agreement is enforceable against the parties
thereto in accordance with its terms, and Holding's certificate of
formation and amended and restated limited liability company agreement
do not violate (i) any Delaware statute, (ii) any rule or regulation
of any Delaware governmental agency or body having jurisdiction over
the Company or Holding or (iii) any order of any Delaware court having
jurisdiction over the Company or Holding;
(p) The statements set forth in the Prospectus under the captions
"Description of Notes" and "Description of Capital Stock and
Membership Units," insofar as they purport to constitute a summary of
the terms of the Securities and the Common Stock, and under the
captions "Risk Factors--Regulatory and Legislative Matters,"
"Business--Pending AT&T Transactions,"
8
"Regulation and Legislation," "Management," "Certain Relationships and
Related Transactions," "Description of Certain Indebtedness," "Certain
United States Tax Considerations for Non-United States Holders of
Class A Common Stock" and "Summary of Certain United States Federal
Tax Considerations for Holders of Notes," insofar as they purport to
describe the provisions of the laws, documents and arrangements
referred to therein, are accurate in all material respects;
(q) Other than as set forth in the Prospectus, there are no legal
or governmental proceedings (including, without limitation, by the FCC
or any franchising authority) pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which, if determined adversely
to the Company or any of its subsidiaries, would, individually or in
the aggregate, have a Material Adverse Effect; and, to the best
knowledge of the Company and Holding and except as disclosed in the
Prospectus, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(r) Each of the Company and its subsidiaries carries insurance
(including self-insurance) in such amounts and covering such risks as
in the reasonable determination of the Company and Holding is adequate
for the conduct of its business and the value of its respective
properties;
(s) Except as set forth in the Prospectus, there is no strike,
labor dispute, slowdown or work stoppage with the employees of any of
the Company or its subsidiaries which is pending or, to the best
knowledge of the Company and Holding, threatened which would,
individually or in the aggregate, have a Material Adverse Effect;
(t) Neither the Company nor Holding is and, after giving effect to
the offering and sale of the Securities, neither of them will be an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "Investment Company Act");
(u) The audited consolidated financial statements (including the
notes thereto) included or incorporated by reference in the Prospectus
present fairly in all material respects the respective consolidated
financial positions, results of operations and cash flows of the
entities to which they relate at the dates and for the periods to
which they relate and have been prepared in accordance with U.S.
generally accepted accounting principles ("GAAP") applied on a
consistent basis; the supporting schedules included or incorporated by
reference in the Registration Statement present fairly in accordance
with GAAP the information required to be stated therein; and the
summary and selected financial data in the Prospectus
9
present fairly in all material respects the information shown therein
and have been prepared and compiled on a basis consistent with the
audited financial statements included therein;
(v) The pro forma financial statements (including the notes
thereto) and the other pro forma financial information included or
incorporated by reference in the Prospectus (i) comply as to form in
all material respects with the applicable requirements of Regulation
S-X for Form S-3 promulgated under the Exchange Act, and (ii) have
been properly computed on the bases described therein; the assumptions
used in the preparation of the pro forma financial data and other pro
forma financial information included or incorporated by reference in
the Prospectus are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances
referred to therein;
(w) Each of the firms who have certified financial statements
included or incorporated by reference in the Prospectus are
independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder, based upon
representations by such firms to the Company;
(x) The Company and its subsidiaries own or possess, or can
acquire on reasonable terms, adequate licenses, trademarks, service
marks, trade names and copyrights (collectively, "Intellectual
Property") necessary to conduct the business now or proposed to be
operated by each of them as described in the Prospectus, except where
the failure to own, possess or have the ability to acquire any
Intellectual Property would not, individually and in the aggregate,
have a Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of infringement of or conflict
with (and none actually knows of any such infringement of or conflict
with) asserted rights of others with respect to any Intellectual
Property which, if any such assertion of infringement or conflict were
sustained would, individually or in the aggregate, have a Material
Adverse Effect;
(y) Except as described in the Prospectus, the Company and its
subsidiaries have obtained all consents, approvals, orders,
certificates, licenses, permits, franchises and other authorizations
of and from, and have made all declarations and filings with, all
governmental and regulatory authorities (including, without
limitation, the FCC), all self-regulatory organizations and all courts
and other tribunals legally necessary to own, lease, license and use
their respective properties and assets and to conduct their respective
businesses in the manner described in the Prospectus, except to the
extent that the failure to so obtain or file would not, individually
and in the aggregate, have a Material Adverse Effect;
10
(z) Except as described in the Prospectus, there are no contracts,
agreements or understandings between the Company, Holding or any of
their affiliates and any person granting such person the right to
require the Company or Holding to file a registration statement under
the Act with respect to any securities of the Company or Holding; and
except as described in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, and no
commitments, plans or arrangements to issue, any securities of the
Company or Holding or any security convertible into or exchangeable
for securities of the Company or Holding;
(aa) The Company and its subsidiaries have filed all necessary
federal, state and foreign income and franchise tax returns required
to be filed as of the date hereof, except where the failure to so file
such returns would not, individually and in the aggregate, have a
Material Adverse Effect, and have paid all taxes shown as due thereon;
and there is no tax deficiency that has been asserted against the
Company or any of its subsidiaries that could reasonably be expected
to result, individually or in the aggregate, in a Material Adverse
Effect;
(bb) The Company and its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(cc) Each of the franchises held by the Company and its
subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, is in full force and effect, with no material
restrictions or qualifications other than those with which the Company
and/or its subsidiaries are in compliance in all material respects;
and to the best knowledge of the Company, no event has occurred which
permits, or with notice or lapse of time or both would permit, the
revocation or non-renewal of any such franchise, assuming the filing
of timely renewal applications and the timely payment of all
applicable filing and regulatory fees to the applicable franchising
authority, or which might result, individually or in the aggregate, in
any other material impairment of the rights of the Company and its
subsidiaries in such franchises. Except as described in the
Prospectus, the Company has no reason to believe that any such
franchise will not be renewed in the ordinary course; and
11
(dd) The Company and its subsidiaries (i) are in compliance with
any and all applicable foreign, federal, state and - local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions of
such permits, licenses or approvals would not, individually and in the
aggregate, have a Material Adverse Effect.
(ee) There are no contracts, other documents or other agreements
required to be described in the Registration Statement or to be filed
as exhibits to the Registration Statement by the Act or by the rules
and regulations thereunder which have not been described or filed or
incorporated by reference therein as required; the contracts so
described in the Prospectus are in full force and effect on the date
hereof; and neither the Company nor any of its subsidiaries and, to
the best of the Company's knowledge, any other party is in breach of
or default under any of such contracts, except for those breaches or
defaults that would not, individually and in the aggregate, result in
a Material Adverse Effect.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price of 97.25% of the principal amount thereof, the principal amount
of Firm Securities set forth opposite the name of such Underwriter in Schedule I
hereto and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Securities as provided below, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
the same purchase price set forth in clause (a) of this Section 2, that portion
of the aggregate principal amount of the Optional Securities as to which such
election shall have been exercised determined by multiplying such aggregate
principal amount of Optional Securities by a fraction, the numerator of which is
the maximum aggregate principal amount of Optional Securities which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
aggregate principal amount of Optional Securities that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to
purchase at their election up to $82,500,000 aggregate principal amount of
Optional Securities, at the purchase price set forth in clause (a) of the first
paragraph of this Section 2, for the sole purpose of covering sales of
securities in excess of the aggregate principal amount of the
12
Firm Securities. Any such election to purchase Optional Securities may be
exercised only by written notice from both of Morgan Stanley & Co. Incorporated
and Goldman, Sachs & Co. to the Company, given within a period of 30 calendar
days after the date of this Agreement, setting forth the aggregate principal
amount of Optional Securities to be purchased and the date on which such
Optional Securities are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice.
At each Time of Delivery, Holding shall pay to Goldman, Sachs &
Co., for the account of the Underwriters, as compensation for the Underwriters'
services in connection with the offering and sale of the Securities, an
underwriting commission equal to 3.0% of the aggregate principal amount of the
Securities being purchased at such Time of Delivery.
3. Upon the authorization by you of the release of the Firm
Securities, the several Underwriters propose to offer the Firm Securities for
sale upon the terms and conditions set forth in the Prospectus.
4. (a) The Securities to be purchased by each Underwriter
hereunder will be represented by one or more definitive global Securities in
book-entry form which will be deposited by or on behalf of the Company with The
Depository Trust Company ("DTC") or its designated custodian. The Company will
deliver the Securities to Goldman, Sachs & Co., for the account of each
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer of same day funds wired in accordance with the
written instructions of the Company, by causing DTC to credit the Securities to
the account of Goldman, Sachs & Co. at DTC. The Company will cause the
certificates representing the Securities to be made available to Goldman, Sachs
& Co. for checking at least twenty-four hours prior to the Time of Delivery (as
defined below) at the office of DTC or its designated custodian (the "Designated
Office"). The time and date of such delivery and payment shall be, with respect
to the Firm Securities, 9:30 a.m., New York City time, on May 30, 2001 or such
other time and date as Morgan Stanley & Co. Incorporated and Goldman, Sachs &
Co. and the Company may agree upon in writing, and, with respect to the Optional
Securities, 9:30 a.m., New York City time, on the date specified by Morgan
Stanley & Co. Incorporated and Goldman, Sachs & Co. in the written notice given
by Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co. of the
Underwriters' election to purchase such Optional Securities, or such other time
and date as Goldman, Sachs & Co. and the Company may agree upon in writing. Such
time and date for delivery of the Firm Securities is herein called the "First
Time of Delivery", such time and date for delivery of the Optional Securities,
if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a "Time of
Delivery."
13
(b) The documents to be delivered at each Time of Delivery by or
on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Securities and any additional documents requested by the
Underwriters pursuant to Section 7(j) hereof, will be delivered at such time and
date at the offices of Paul, Hastings, Janofsky & Walker LLP, 399 Park Avenue,
New York, New York 10022 or such other location as the parties mutually agree
(the "Closing Location"), and the Securities will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at 2:00 p.m., New York City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day
following the execution and delivery of this Agreement; to make no
further amendment or any supplement to the Registration Statement or
Prospectus prior to the last Time of Delivery which shall be
disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish you with copies thereof; to
file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering
or sale of the Securities, to advise you, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Prospectus, of
the suspension of the qualification of the Securities or of the shares
of Common Stock issuable upon conversion of the Securities for
offering or sale in any jurisdiction, of the initiation or threatening
of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and, in the
event of the issuance of any stop order or of any order preventing or
suspending the use of any Prospectus or suspending any such
qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
14
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities and the shares of Common
Stock issuable upon conversion of the Securities for offering and sale
under the securities laws of such jurisdictions as you may request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the Securities, provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process
in any jurisdiction;
(c) On the New York Business Day next succeeding the date of this
Agreement or as soon as practicable thereafter and from time to time,
to furnish the Underwriters with written and electronic copies of the
Prospectus in New York City in such quantities as you may reasonably
request, and, if the delivery of a prospectus is required at any time
prior to the expiration of nine months after the time of issue of the
Prospectus in connection with the offering or sale of the Securities
and the shares of Common Stock issuable upon conversion of the
Securities and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement
the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with
the Act, the Exchange Act or the Trust Indenture Act, to notify you
and upon your request to file such document and to prepare and furnish
without charge to each Underwriter and to any dealer in securities as
many written and electronic copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect
such compliance; and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Securities and the
shares of Common Stock issuable upon conversion of the Securities at
any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter,
to prepare and deliver to such Underwriter as many written and
electronic copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
15
(e) During the period beginning from the date hereof and
continuing until the date 90 days after the date of this Agreement,
not to offer, sell, contract to sell or otherwise dispose of, except
as provided hereunder, any securities of the Company that are
substantially similar to the Securities or the Common Stock, including
but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Common Stock
or any such substantially similar securities (other than (i) pursuant
to employee option plans existing on the date of this Agreement (or
subsequently adopted by the Company's board of directors), (ii) upon
the conversion or exchange of convertible or exchangeable securities
outstanding as of the date of this Agreement or (iii) shares of Common
Stock issued by the Company as consideration for acquisitions of
businesses occurring after the date of this Agreement as long as the
recipients of such shares execute and deliver prior to the closing of
any such acquisition a lock-up agreement substantially to the effect
of the lock-up agreements being delivered pursuant to Section 7(k)
hereof), without the prior written consent of Morgan Stanley & Co.
Incorporated and Goldman, Sachs & Co.; provided that this paragraph
(e) shall not restrict the Company's participation (other than as a
seller of securities) in connection with sales of securities under
registration statements that (x) are effective on the date of this
Agreement or (y) the Company is required to file pursuant to
registration rights agreements (other than with any person or entity
named on Schedule II hereto) outstanding on the date of this
Agreement;
(f) Not to be or become, at any time prior to the expiration of
two years after the Time of Delivery, an open-end investment company,
unit investment trust, closed-end investment company or face-amount
certificate company that is or is required to be registered under
Section 8 of the Investment Company Act;
(g) To furnish to the holders of the Securities as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders' or
members' equity and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as soon
as practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to
holders of the Securities consolidated summary financial information
of the Company and its subsidiaries for such quarter in reasonable
detail;
(h) During a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or
other communications (financial or other) furnished to holders of
Common Stock of the Company, and to deliver to you as soon as they are
available, copies of any reports and financial statements furnished to
or filed with the Commission or any
16
national securities exchange on which the Securities, the Common Stock
or any class of securities of the Company is listed;
(i) To use the net proceeds received from the sale of the
Securities pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(j) To reserve and keep available at all times, free of preemptive
rights, shares of Common Stock for the purpose of enabling the Company
to satisfy any obligation to issue shares of Common Stock upon
conversion of the Securities; and
(k) To use its best efforts to cause the shares of Common Stock
issuable upon conversion of the Securities to be approved for
quotation on the National Market Nasdaq ("Nasdaq").
6. Holding covenants and agrees with the several Underwriters that
Holding will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's and Holding's counsel and accountants in
connection with the registration of the Securities and the shares of Common
Stock issuable upon conversion of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the Indenture, the Blue Sky
Memorandum, closing documents (including compilations thereof) and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iii) all expenses in connection with the qualification of the
Securities and the shares of Common Stock issuable upon conversion of the
Securities for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky survey; (iv) any fees charged by securities rating services for rating
the Securities; (v) the filing fees incident to, and the fees and disbursements
of counsel for the Underwriters in connection with, any required review by the
NASD of the terms of the sale of the Securities; (vi) the cost of preparing the
Securities; (vii) the fees and expenses of the Trustee and any agent of the
Trustee and the fees and disbursements of counsel for the Trustee in connection
with the Indenture and the Securities; and (viii) all other costs and expenses
incident to the performance of the Company's and Holding's obligations hereunder
which are not otherwise specifically provided for in this Section. It is
understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of any of the
17
Securities by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters hereunder, as to the
Securities to be delivered at each Time of Delivery, shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company and Holding herein are, at and as of such Time of
Delivery, true and correct, the condition that the Company and Holding shall
have performed all of their obligations hereunder theretofore to be performed,
and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall
have been issued and no proceeding for that purpose shall have been
initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Debevoise & Plimpton, counsel for the Underwriters, shall have
furnished to you such opinion, dated such Time of Delivery, with
respect to the matters covered in paragraphs (i), (ii) (as to the
shares issuable upon conversion of the Securities), (v), (vi), (vii),
(viii), (xi) (as to the Securities and the Common Stock), (xiii) and
the last paragraph of subsection (c) below as well as such other
related matters as you may reasonably request; and such counsel shall
have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(c) Paul, Hastings, Janofsky & Walker LLP, counsel for the Company
and Holding, shall have furnished to you their written opinion, dated
such Time of Delivery, in form and substance satisfactory to you, to
the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware; Holding has been duly formed and is validly
existing as a limited liability company in good standing under the
laws of the State of Delaware; each of the Company and Holding has
the power and authority (corporate or other) to own or lease its
properties and conduct its business as described in the Prospectus
and to execute, deliver and perform its obligations under this
Agreement;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus; the Securities are convertible into shares of
Common
18
Stock in accordance with the terms of the Indenture; the shares of
Common Stock initially issuable upon conversion of the Securities
have been duly and validly authorized and reserved for issuance
and, when issued and delivered in accordance with the provisions
of the Securities and the Indenture, will be duly and validly
issued and fully paid and non-assessable; and the Common Stock
conforms in all material respects to the description thereof
contained in the Prospectus under the caption "Description of
Capital Stock and Membership Units";
(iii) Holding has an authorized capitalization as set forth in
the Prospectus; and the Membership Units conform in all material
respects to the description thereof contained in the Prospectus
under the caption "Description of Capital Stock and Membership
Units";
(iv) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which are likely to have,
individually or in the aggregate, a Material Adverse Effect; and,
to the best of such counsel's knowledge and other than as set
forth in the Prospectus, no such proceedings are overtly
threatened by governmental authorities or by others;
(v) This Agreement has been duly authorized, executed and
delivered by each of the Company and Holding;
(vi) The Securities have been duly authorized by the Company,
and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will
be valid and legally binding obligations of the Company, entitled
to the benefits provided by the Indenture and enforceable against
the Company in accordance with their terms, subject, as to
enforcement, to applicable bankruptcy, reorganization, insolvency
or other similar laws affecting creditors' rights generally and to
general equity principles;
(vii) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming the due execution and
delivery thereof by the Trustee) constitutes a valid and legally
binding instrument, enforceable against the Company in accordance
with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to
19
general equity principles; and the Indenture has been duly
qualified under the Trust Indenture Act;
(viii) The Securities and the Indenture conform in all
material respects to the descriptions thereof in the Prospectus
under the caption "Description of Notes";
(ix) The issue and sale of the Securities and the compliance
by the Company and Holding, as the case may be, with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein
contemplated, including the issuance of shares of Common Stock
upon conversion of the Securities, will not, to the best of such
counsel's knowledge, result in a material breach or violation of
any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement, lease,
license, permit or other agreement or instruments specifically
identified to such counsel by the Company as material to the
Company on a schedule, nor will any such action result in any
violation of the provisions of the restated certificate of
incorporation or by-laws of the Company, or the certificate of
formation or amended and restated limited liability company
agreement of Holding or any Federal or New York State statute or
any order, rule or regulation of any Federal or New York State
court or governmental agency or body having jurisdiction over the
Company or its subsidiaries or any of their properties;
(x) No consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency
or body referred to in paragraph (ix) is required for the issue
and sale of the Securities, the issue and delivery of shares of
Common Stock issuable upon conversion of the Securities or the
consummation by the Company and Holding of the transactions
contemplated by this Agreement or the Indenture, except the
registration under the Act of the Securities and the Common Stock
and such consents, approvals, authorizations, registrations or
qualifications as have been obtained or may be required under
state or foreign securities or Blue Sky laws in connection with
the purchase and distribution of the Securities by the
Underwriters and except such as may be requested by the NASD;
(xi) The statements set forth in the Prospectus under the
caption "Description of Notes" and "Description of Capital Stock
and Membership Units," insofar as they purport to constitute a
summary of the terms of the Securities and the Common Stock, and
under the captions "Description of Certain Indebtedness," "Certain
United States Tax
20
Considerations for Non-United States Holders of Class A Common
Stock", "Summary of Certain United States Federal Income Tax
Considerations for Holders of Notes," and "Indemnification of
Directors and Officers," insofar as they purport to describe the
provisions of the laws, documents and arrangements referred to
therein, fairly summarize the provisions of any such laws and
documents in all material respects;
(xii) Neither the Company nor Holding is an "investment
company" or an entity "controlled" by an "investment company," as
such terms are defined in the Investment Company Act;
(xiii) The Registration Statement and the Prospectus and any
further amendments and supplements thereto made by the Company
prior to such Time of Delivery (other than the financial
statements and related notes and schedules therein, as to which
such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Act and the Trust
Indenture Act and the rules and regulations thereunder, although
such counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those
referred to in the opinion; and
(xiv) The documents incorporated by reference in the
Prospectus or any further amendment or supplement thereto made by
the Company prior to such Time of Delivery (other than the
financial statements and related notes and schedules therein, as
to which such counsel need express no opinion), when they became
effective or were filed with the Commission, as the case may be,
complied as to form in all material respects with the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, although such counsel
does not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the documents
incorporated by reference in the Prospectus or any further
amendment or supplement thereto, except for those referred to in
the opinion.
Such counsel shall also state as follows: We have not
independently verified the accuracy, completeness or fairness of the
statements made or included in the Registration Statement or the
Prospectus, except as described in specified paragraphs of the
opinion. However, in connection with the preparation by the Company of
the Registration Statement and the Prospectus, we participated in
various discussions and meetings with the Underwriters'
representatives, officers and other representatives of the Company,
and representatives of the Company's
21
independent public accountants at which the contents of the
Registration Statement and the Prospectus were discussed. No
information has come to our attention which causes us to conclude
(relying as to factual matters, to the extent necessary to determine
materiality, upon the opinions of officers and other representatives
of the Company and Holding) that (i) the Registration Statement at the
time it became effective contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, and (ii)
the Prospectus, or any supplement thereto, on the date it was filed
pursuant to the rules and regulations under the Act and as of the date
hereof, contained an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading (except, in each case in respect of the Registration
Statement or the Prospectus or any supplement thereto, that we express
no view as to financial statements and notes thereto, financial
schedules and other financial information included therein or to the
exhibits to the Registration Statement).
(d) Cole, Raywid & Braverman, L.L.P., special regulatory counsel
to the Company and Holding, shall have furnished to you their written
opinion, dated such Time of Delivery, in form and substance reasonably
satisfactory to you, to the effect that:
(i) The issue and sale of the Securities and the compliance by
the Company and Holding, as the case may be, with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein
contemplated do not and will not contravene the Cable Acts or any
order, rule or regulation of the FCC to which the Company or any
of its subsidiaries or any of their properties is subject;
(ii) To the best of such counsel's knowledge, no consent,
approval, authorization or order of, or registration,
qualification or filing with the FCC is required under the Cable
Acts or any order, rule or regulation of the FCC in connection
with the issue and sale of the Securities and the compliance by
the Company and Holding, as the case may be, with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein
contemplated;
(iii) The statements set forth in the Prospectus under the
captions "Risk Factors" under the subheading "Regulatory and
Legislative Matters" and in "Regulation and Legislation," insofar
as they constitute summaries of laws referred to therein,
concerning the Cable Acts and the published
22
rules, regulations and policies promulgated by the FCC thereunder,
fairly summarize the matters described therein;
(iv) To the knowledge of such counsel based solely upon its
review of publicly available records of the FCC and operational
information provided by the Company's and its subsidiaries'
management, the Company and its subsidiaries hold all FCC licenses
for cable antenna relay services necessary to conduct the business
of the Company and its subsidiaries as currently conducted, except
to the extent the failure to hold such FCC licenses would not,
individually and in the aggregate, be reasonably expected to have
a Material Adverse Effect; and
(v) Except as disclosed in the Prospectus and except with
respect to rate regulation matters, and general rulemakings and
similar matters relating generally to the cable television
industry, to such counsel's knowledge, based solely upon its
review of the publicly available records of the FCC and upon
inquiry of the Company's and its subsidiaries' management, during
the time the cable systems of the Company and its subsidiaries
have been owned by the Company and its subsidiaries (A) there has
been no adverse FCC judgment, order or decree issued by the FCC
relating to the ongoing operations of any of the Company or one of
its subsidiaries that has had or could reasonably be expected to
have a Material Adverse Effect; and (B) there are no actions,
suits, proceedings, inquiries or investigations by or before the
FCC pending or threatened in writing against or specifically
affecting the Company or any of its subsidiaries or any cable
system of the Company or any of its subsidiaries which could,
individually or in the aggregate, be reasonably expected to result
in a Material Adverse Effect;
(e) Curtis S. Shaw, Esq., Senior Vice President, General Counsel
and Secretary of the Company and Holding, shall have furnished to you
his written opinion, dated the Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) Each subsidiary of the Company listed on a schedule
attached to such counsel's opinion (the "Charter Subsidiaries")
has been duly incorporated or formed, as the case may be, and is
validly existing as a corporation or limited liability company, as
the case may be, in good standing under the laws of its
jurisdiction of incorporation or formation; and all of the issued
shares of capital stock or limited liability company interests, as
the case may be, of each Charter Subsidiary have been duly and
validly authorized and issued and, assuming receipt of requisite
consideration therefore, are fully paid and non-assessable;
23
(ii) Each of the Company and the Charter Subsidiaries has been
duly qualified as a foreign corporation or limited liability
company, as the case may be, for the transaction of business and
is in good standing under the laws of each jurisdiction set forth
in a schedule to such counsel's opinion;
(iii) To the best of such counsel's knowledge and other than
as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
subsidiaries is party or of which any property of the Company or
any of its subsidiaries is the subject which are likely to have,
individually or in the aggregate, a Material Adverse Effect; and,
to the best of such counsel's knowledge and other than as set
forth in the Prospectus, no such proceedings are overtly
threatened by governmental authorities or by others; and
(f) On the date of the Prospectus at a time prior to the execution
of this Agreement, at 9:30 a.m., New York City time, on the effective
date of any post-effective amendment to the Registration Statement
filed subsequent to the date of this Agreement and also at each Time
of Delivery, each of Arthur Andersen LLP, KPMG LLP, Ernst & Young LLP
and PriceWaterhouseCoopers LLP, shall have furnished to you a letter
or letters, dated the respective dates of delivery thereof, in form
and substance satisfactory to you;
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus, and (ii) since the respective dates as
of which information is given in the Prospectus there shall not have
been any change in the capital stock, limited liability company
interests or long-term debt of the Company or any of its subsidiaries
or any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position,
stockholders' or members' equity, or results of operations of the
Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities being issued at such Time of Delivery on the terms and in
the manner contemplated in the Prospectus;
(h) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the debt securities of the Company or
any of its subsidiaries
24
by any "nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule 436(g)(2)
under the Act, and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible
negative implications, its rating of any of the debt securities of the
Company or any of its subsidiaries;
(i) On or after the date hereof there shall not have occurred any
of the following: (i) a suspension or material limitation in trading
in securities generally on the New York Stock Exchange or on the
Nasdaq; (ii) a suspension or material limitation in trading in the
Common Stock on the Nasdaq, (iii) a general moratorium on commercial
banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war, if the effect of any such event specified
in this clause (iv) in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities being issued at such Time of Delivery
on the terms and in the manner contemplated in the Prospectus;
(j) The Company and Holding shall have furnished or caused to be
furnished to you at such Time of Delivery certificates of officers of
each of the Company and Holding satisfactory to you as to the accuracy
of the representations and warranties of each of the Company and
Holding herein at and as of such Time of Delivery, as to the
performance by each of the Company and Holding of all of its
obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (g) of
this Section and as to such other matters as you may reasonably
request;
(k) The Company has obtained and delivered to the Underwriters
executed copies of an agreement from the persons and entities named in
Schedule II hereto, substantially to the effect set forth in lock-up
agreements delivered in connection with the Company's October 2000
issuance of convertible senior notes;
(l) The shares of Common Stock issuable upon conversion of the
Securities shall have been duly listed, subject to notice of issuance,
on the Nasdaq; and
(m) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of this Agreement.
8. (a) The Company and Holding, jointly and severally, will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities,
25
joint or several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company and Holding shall not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Morgan Stanley & Co. Incorporated and
Goldman, Sachs & Co. expressly for use therein.
(b) The Underwriters, severally and not jointly, will indemnify
and hold harmless the Company and Holding against any losses, claims, damages or
liabilities to which the Company or Holding may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co.
expressly for use therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
26
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. Any indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified
parties. The Company and Holding shall not be required to indemnify the
Underwriters for any amounts paid or payable by the Underwriters in the
settlement of any action, proceeding or investigation without the written
consent of the Company to such settlement, which consent shall not be
unreasonably withheld. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to,
or an admission of, fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and Holding on the one hand and the
Underwriters on the other from the offering of the Securities. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and Holding on the one hand and the Underwriters on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company and Holding on the one hand and the Underwriters on the other
shall be deemed to be in the same
27
proportion as the total net proceeds from the offering of the Securities
purchased under this Agreement (before deducting expenses) received by the
Company and Holding bear to the total underwriting discounts and commissions
received by the Underwriters with respect to the Securities purchased under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and Holding on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
Holding and the Underwriters agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this subsection (d),
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company and Holding under this Section
8 shall be in addition to any liability which the Company and Holding may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and Holding and to each person, if any, who controls the Company or
Holding within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Securities which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or other
parties to purchase such Securities on the terms contained herein at such Time
of Delivery. If within thirty-six hours after such default by any Underwriter
you do not arrange for the purchase of such
28
Securities, then the Company shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to you
to purchase such Securities on such terms. In the event that, within the
respective prescribed periods, you notify the Company that you have so arranged
for the purchase of such Securities, or the Company notifies you that it has so
arranged for the purchase of such Securities, you or the Company shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase
of the Securities of a defaulting Underwriter or Underwriters by you and the
Company as provided in subsection (a) above, the aggregate principal amount of
such Securities which remains unpurchased does not exceed one-eleventh of the
aggregate principal amount of all the Securities to be purchased at such Time of
Delivery, then the Company shall have the right to require each non-defaulting
Underwriter to purchase the principal amount of Securities which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the principal amount of Securities which such Underwriter agreed
to purchase hereunder) of the Securities of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase
of the Securities of a defaulting Underwriter or Underwriters by you and the
Company as provided in subsection (a) above, the aggregate principal amount of
Securities which remains unpurchased exceeds one-eleventh of the aggregate
principal amount of all the Securities to be purchased at such Time of Delivery,
or if the Company shall not exercise the right described in subsection (b) above
to require non-defaulting Underwriters to purchase Securities of a defaulting
Underwriter or Underwriters (or, with respect to the Second Time of Delivery,
the obligations of the Underwriters to purchase and of the Company to sell the
Optional Securities), then this Agreement shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter, the Company or Holding,
except for the expenses to be borne by the Company, Holding and the Underwriters
as provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
29
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and Holding and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company and Holding, or any officer or director or
controlling person of the Company or Holding, and shall survive delivery of and
payment for the Securities.
11. If this Agreement shall be terminated pursuant to Section 9
hereof, the Company and Holding shall not then be under any liability to any
Underwriter except as provided in Sections 6 and 8 hereof; but, if, for any
other reason other than a termination pursuant to Section 7(i), any Securities
are not delivered by or on behalf of the Company as provided herein, the Company
and Holding will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Securities, but the Company and Holding shall
then be under no further liability to any Underwriter except as provided in
Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of
the Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Morgan Stanley & Co. Incorporated and Goldman, Sachs
& Co. on behalf of you as the Representatives.
All statements, requests, notices and agreements hereunder shall
be in writing, and if to the Underwriters shall be delivered or sent by mail,
telex or facsimile transmission to you as the Representatives in care of Morgan
Stanley & Co. Incorporated, 1585 Broadway, New York, New York 10036, Attention:
High Yield Capital Markets Department, and Goldman, Sachs & Co., 32 Old Slip,
21st Floor, New York, New York 10005, Attention: Registration Department; and if
to the Company or Holding shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, Holding, and, to the extent provided
in Sections 8 and 10 hereof, the officers and directors of the Company and each
person who controls
30
the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such respective counterparts shall together constitute
one and the same instrument.
31
If the foregoing is in accordance with your understanding, please
sign and return to us counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement between each of the Underwriters,
the Company and Holding. It is understood that your acceptance of this letter on
behalf of each of the Underwriters is pursuant to the authority set forth in a
form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination upon request, but without warranty on your part as
to the authority of the signers thereof.
Very truly yours,
Charter Communications, Inc.
By: /s/ Curtis S. Shaw
-------------------------------
Name: Curtis S. Shaw
Title: Senior Vice President, General Counsel
and Secretary
Charter Communications Holding Company, LLC
By: /s/ Curtis S. Shaw
-------------------------------
Name: Curtis S. Shaw
Title: Senior Vice President, General Counsel
and Secretary
32
Accepted as of the date hereof:
Morgan Stanley & Co. Incorporated
Goldman, Sachs & Co.
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
J.P. Morgan Securities LLC
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns
Dresdner Kleinwort Wasserstein Securities LLC
Acting severally on behalf of themselves and the several Underwriters named in
Schedule I hereto.
By: Goldman, Sachs & Co.
By: /s/ Goldman, Sachs & Co.
---------------------------------
Name:
Title:
By: Morgan Stanley & Co. Incorporated
By: /s/ Daniel H. Klausner
---------------------------------
Name: Daniel H. Klausner
Title: Principal
33
SCHEDULE I
Principal Amount of Principal Amount of
Firm Securities Optional Securities
Underwriter to be Purchased to be Purchased
- ----------- --------------- ---------------
Morgan Stanley & Co. Incorporated....................... $192,500,000 $28,875,000
Goldman, Sachs & Co. ................................... 192,500,000 28,875,000
Banc of America Securities LLC.......................... 27,500,000 4,125,000
Bear, Stearns & Co. Inc................................. 27,500,000 4,125,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated...... 27,500,000 4,125,000
Salomon Smith Barney Inc................................ 27,500,000 4,125,000
J.P. Morgan Securities LLC.............................. 22,000,000 3,300,000
Credit Lyonnais Securities (USA) Inc.................... 11,000,000 1,650,000
Fleet Securities, Inc................................... 11,000,000 1,650,000
BMO Nesbitt Burns ...................................... 5,500,000 825,000
Dresdner Kleinwort Wasserstein Securities LLC........... 5,500,000 825,000
------------- ---------------
Total $550,000,000 $82,500,000
SCHEDULE II
Paul G. Allen
Jerald L. Kent
Marc B. Nathanson
Ronald L. Nelson
Nancy B. Peretsman
William D. Savoy
Howard L. Wood
David C. Andersen
David G. Barford
Mary Pat Blake
Eric A. Freesmeier
Thomas R. Jokerst
Kent D. Kalkwarf
Ralph G. Kelly
David L. McCall
Majid R. Mir
John C. Pietri
Michael E. Riddle
Steven A. Schumm
Curtis S. Shaw
Stephen E. Silva
James (Trey) H. Smith, III
Charter Communications Holding Company, LLC
Vulcan Cable III Inc.
Charter Investment, Inc.
INDENTURE dated as of May 30, 2001 between Charter Communications, Inc.,
a Delaware corporation (as further defined below, the "Company"), and BNY
Midwest Trust Company, as trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the Notes:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling, "controlled by" and "under common control
with" shall have correlative meanings.
"Agent" means any Registrar, Paying Agent or Conversion Agent.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of DTC, in each case to the extent applicable to such transaction
and as in effect from time to time.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or
state law of any jurisdiction relating to bankruptcy, insolvency, winding up,
liquidation, reorganization or relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as such term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire, whether such
right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition.
"Board of Directors" means the Board of Directors of the Company or any
authorized committee of the Board of Directors of the Company.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors of the Company and to be in full force and effect on the
date of such certification and delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest (other than any debt obligation) or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"Change of Control" means the occurrence of any of the following:
(1) the sale, transfer, conveyance, lease or other disposition
(including by way of liquidation or dissolution, but excluding by way of
merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of the Company and its Subsidiaries,
taken as a whole, to any "person" (as such term is used in Section 13(d)(3)
of the Exchange Act);
(2) the adoption of a plan relating to the liquidation or dissolution
of the Company;
(3) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than the Principal and Related Parties,
becomes the Beneficial Owner, directly or indirectly, of more than 35% of
the Voting Stock of the Company, measured by voting power rather than
number of shares, unless the Principal or a Related Party Beneficially
Owns, directly or indirectly, a greater percentage of Voting Stock of the
Company, measured by voting power rather than number of shares, than such
person;
2
(4) after the Issue Date, the first day on which a majority of the
members of the Board of Directors of the Company are not Continuing
Directors;
(5) the Company consolidates with, or merges with or into, any
Person, or any Person consolidates with, or merges with or into, the
Company, in any such event pursuant to a transaction in which any of the
outstanding Voting Stock of the Company is converted into or exchanged for
cash, securities or other property, other than any such transaction where
the Voting Stock of the Company outstanding immediately prior to such
transaction is converted into or exchanged for Voting Stock (other than
Disqualified Stock) of the surviving or transferee Person constituting a
majority of the outstanding shares of such Voting Stock of such surviving
or transferee Person immediately after giving effect to such issuance; or
(6) at any time, (i) the Principal or any Allen Affiliates (as
defined below) purchases, in a transaction or series of transactions,
shares of Common Stock and, solely as a result of such purchases, the
aggregate number of shares of Common Stock held by the Principal and the
Allen Affiliates exceeds 70% of the total number of shares of Common Stock
issued and outstanding at such time and (ii) the Closing Price Per Share of
the Common Stock for any five Trading Days within the period of the 10
consecutive Trading Days immediately after the later of (x) the last date
of such purchases or (y) the public announcement of such purchases, is less
than 100% of the Conversion Price of the Notes in effect on each of those
Trading Days (for purposes of this clause (6), a purchase will not include
any transaction whereby shares of Common Stock are acquired by the
Principal or any Allen Affiliate as a result of the exchange and conversion
of membership units of Charter Communications Holding Company, LLC for and
into shares of Common Stock or the conversion of shares of the Company's
Class B Common Stock, par value $.001 per share, into shares of Common
Stock; the calculation of the number of shares of Common Stock held by the
Principal and the Allen Affiliates will not include securities exchangeable
or convertible into shares of Common Stock; and an "Allen Affiliate" means
any person in which the Principal, directly or indirectly, owns at least
50.1% of the Capital Stock thereof, provided that none of the Company,
Charter Communications Holding Company, LLC or any of the Company's
Subsidiaries shall constitute an Allen Affiliate).
Notwithstanding the foregoing, a Change of Control shall not be deemed
to have occurred if (i) the Closing Price Per Share of the Common Stock for any
five Trading Days within the period of 10 consecutive Trading Days ending
immediately after the later of the Change of Control or the public announcement
of the Change of Control (in the case of a Change of Control under clause (3)
above) or the period of 10 consecutive Trading Days ending immediately before
the Change of Control (in the case of a Change of Control under clauses (1) or
(5) above) shall equal or exceed 105% of the Conversion Price of the Notes in
effect on each such Trading Day or (ii) all of the consideration
3
(excluding cash payments for fractional shares and cash payments made pursuant
to dissenters' appraisal rights) in a merger or consolidation otherwise
constituting a Change of Control under clause (3) and/or clause (5) above
issuable to holders of Common Stock consists of shares of common stock traded on
a national securities exchange or quoted on the Nasdaq National Market (or will
be so traded or quoted immediately following such merger or consolidation) and
as a result of such merger or consolidation the Notes become convertible into
such common stock.
"Closing Price Per Share" means, with respect to the Common Stock, for
any day, (i) the last reported bid price regular way on the Nasdaq National
Market or, (ii) if the Common Stock is not quoted on the Nasdaq National Market,
the last reported sale price regular way per share or, in case no such reported
sale takes place on such day, the average of the reported closing bid and asked
prices regular way, in either case, on the principal national securities
exchange on which the Common Stock is listed or admitted to trading, or (iii) if
the Common Stock is not quoted on the Nasdaq National Market or listed or
admitted to trading on any national securities exchange, the average of the
closing bid prices in the over-the-counter market as furnished by any New York
Stock Exchange member firm selected from time to time by the Company for that
purpose.
"Commission" or "SEC" means the Securities and Exchange Commission.
"common stock" includes any stock of any class of capital stock which
has no preference in respect of dividends or of amounts payable in the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
issuer thereof and which is not subject to redemption by the issuer thereof.
"Common Stock" means the Class A Common Stock, par value $.001 per
share, of the Company authorized at the date of this instrument as originally
executed. Subject to the provisions of Section 10.11, shares issuable on
conversion or repurchase of Notes shall include only shares of Common Stock or
shares of any class or classes of common stock resulting from any
reclassification or reclassifications thereof; provided, however, that if at any
time there shall be more than one such resulting class, the shares so issuable
on conversion of Notes shall include shares of all such classes, and the shares
of each such class then so issuable shall be substantially in the proportion
which the total number of shares of such class resulting from all such
reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first paragraph
of this instrument until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
4
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who:
(1) was a member of the Board of Directors on the Issue Date; or
(2) was nominated for election or elected to the Board of Directors
with the approval of a majority of the Continuing Directors who were
members of such board of directors at the time of such nomination or
election or whose election or appointment was previously so approved.
"Conversion Agent" means any Person authorized by the Company to convert
Notes in accordance with Article 10. The Company has initially appointed the
Trustee as its Conversion Agent pursuant to Section 2.03 hereof.
"Conversion Price" shall equal U.S.$1,000 divided by the
Conversion Rate (rounded to the nearest cent).
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 or such other address as to which the Trustee
may give notice to the Company.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Depositary" means, with respect to any Notes (including any Global
Notes), a clearing agency that is registered under the Exchange Act and is
designated by the Company to act as Depositary for such Notes (or any successor
securities clearing agency so registered).
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or is redeemable at the option of the
holder thereof, in whole or in part, on or prior to the date that is 91 days
after the date on which the Notes mature.
"DTC" means The Depository Trust Company, a New York corporation.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Global Note" means a Note that is registered in the Note Register for
the Notes in the name of a Depositary or a nominee thereof.
5
"Guarantee" or "guarantee" means a guarantee other than by endorsement
of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a
pledge of assets or through letters of credit or reimbursement agreements in
respect thereof, of all or any part of any Indebtedness, measured as the lesser
of the aggregate outstanding amount of the Indebtedness so guaranteed and the
face amount of the Guarantee.
"Holder" means the Person in whose name the Note is registered in the
Note Register.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments; or
(3) representing capital lease obligations.
The amount of any Indebtedness outstanding as of any date shall be (i) the
accreted value thereof, in the case of any Indebtedness issued with original
issue discount; and (ii) the principal amount (or portion of the discounted
rental stream attributable to principal in the case of capitalized leases)
thereof, together with any interest thereon that is more than 30 days past due,
in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Notes.
"Issue Date" means May 30, 2001.
"Legal Holiday", when used with respect to any place of payment or Place
of Conversion, as the case may be, means a Saturday, a Sunday or a day on which
banking institutions in The City of New York, at such place of payment or Place
of Conversion, as the case may be, are authorized by law, regulation or
executive order to remain closed. If a payment date is a Legal Holiday at a
place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue on such payment for
the intervening period.
"Maturity", when used with respect to any Notes, means the date on which
the principal of such Notes becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call
for redemption, exercise of the repurchase right set forth in Article 11 or
otherwise.
6
"Non-global Note" means a Note that is in definitive, full registered
form, without interest coupons, and that is not a Global Note.
"Notes" means the Company's 4.75% Convertible Senior Notes due 2006 and
more particularly means any Notes authenticated and delivered under this
Indenture.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the chief financial officer or the treasurer of the Company
that meets the requirements of Section 12.05.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
12.05. The counsel may be an employee of or counsel to the Company or any
Subsidiary of the Company.
"Person" means any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"Place of Conversion" means any city in which any Conversion Agent is
located.
"Predecessor Note" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 2.08 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Note.
"Principal" means Paul G. Allen.
"Record Date Period" means the period from the close of business of any
Regular Record Date next preceding any Interest Payment Date to the opening of
business on such Interest Payment Date.
"Redemption Date", when used with respect to any Note to be redeemed,
means the date fixed for redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Note to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
7
"Regular Record Date" for interest payable in respect of any Note on any
Interest Payment Date means the November 15 or May 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date.
"Related Party" means:
(1) the spouse or an immediate family member, estate or heir of the
Principal; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially
holding an 80% or more controlling interest of which consist of the
Principal and/or such other Persons referred to in the immediately
preceding clause (1).
"Responsible Officer" when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Securities Act" means the Securities Act of 1933, as amended.
"Significant Subsidiary" means any Subsidiary of the Company which is a
"Significant Subsidiary" as defined in Rule 1-02(w) of Regulation S-X under the
Exchange Act.
"Stated Maturity", when used with respect to the principal amount of any
Note or such payment of interest thereon, means the date specified in such Note
as the fixed date on which the principal of such Note or such installment of
interest is due and payable.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association or other business entity of which at
least 50% of the total voting power of shares of Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of that Person (or a combination thereof) and, in the
case of any such entity of which 50% of the total voting power of shares of
Capital Stock is so owned or controlled by such Person or one or more of
the other Subsidiaries of such Person, such Person and its Subsidiaries
also have the right to control the management of such entity pursuant to
contract or otherwise; and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or
(b) the only general
8
partners of which are such Person or of one or more Subsidiaries of such
Person (or any combination thereof).
"Successor Note" of any particular Note means every Note issued after,
and evidencing all or a portion of the same debt as that evidenced by, such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 2.08 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Note.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss. 77aaa-77bbbb)
as in effect on the date on which this Indenture is qualified under the TIA;
provided, however, that in the event the Trust Indenture Act of 1939 is amended
after such date, then "TIA" means, to the extent required by such amendment, the
Trust Indenture Act of 1939 as so amended.
"Trading Day" means (i) if the Common Stock is quoted on the Nasdaq
National Market or any other system of automated dissemination of quotations of
securities prices, days on which trades may be effected through such system, or
(ii) if the Common Stock is listed or admitted for trading on the New York Stock
Exchange or any other national or regional securities exchange, days on which
such national or regional securities exchange is open for business, or (iii) if
the Common Stock is not listed on a national or regional securities exchange or
quoted on the Nasdaq National Market or any other system of automated
dissemination of quotation of securities prices, days on which the Common Stock
is traded regular way in the over-the-counter market and for which a closing bid
and a closing asked price for the Common Stock are available.
"Trustee" means BNY Midwest Trust Company until a successor replaces BNY
Midwest Trust Company in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the board of
directors of such Person.
Section 1.02. Other Definitions.
Defined in
Term Section
"Arrangement Purchaser".............................. 3.08
"Authentication Order"............................... 2.02
"Change of Control Offer"............................ 11.01
"Constituent Person"................................. 10.11
9
"Conversion Agent"................................... 2.03
"Conversion Rate".................................... 10.01
"Event of Default"................................... 6.01
"Expiration Time:.................................... 10.04(6)
"Non-Electing Share"................................. 10.11
"Note Register"...................................... 2.03
"Paying Agent"....................................... 2.03
"Payment Default".................................... 6.01
"Registrar".......................................... 2.03
"Repurchase Date".................................... 11.03
"Repurchase Price"................................... 11.01
"Trigger Event"...................................... 10.12
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor upon
the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
10
(b) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural include
the singular;
(e) provisions apply to successive events and transactions;
(f) references to sections of or rules under the Securities Act shall be
deemed to include substitute, replacement or successor sections or rules adopted
by the Commission from time to time;
(g) references to any statute, law, rule or regulation shall be deemed
to refer to the same as from time to time amended and in effect and to any
successor statute, law, rule or regulation; and
(h) references to any contract, agreement or instrument shall mean the
same as amended, modified, supplemented or amended and restated from time to
time, in each case, in accordance with any applicable restrictions contained in
this Indenture.
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating.
The Notes, the Trustee's certificate of authentication and the
conversion notices shall be substantially in the form of Exhibit A hereto. The
Notes may have notations, legends or endorsements required by law, stock
exchange rule or usage. Each Note shall be dated the date of its authentication.
The Notes shall be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
Upon their original issuance, Notes shall be issued in the form of one
or more Global Notes in definitive, fully registered form without interest
coupons. Such Global
11
Note shall be registered in the name of DTC, as Depositary,
or its nominee and deposited with the Trustee, as custodian for DTC, for credit
by DTC to the respective accounts of beneficial owners of the Notes represented
thereby (or such other accounts as they may direct).
Section 2.02. Execution and Authentication.
Two Officers shall sign the Notes for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
(which may be by facsimile) of the Trustee. The signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Notes executed by the Company to the
Trustee for authentication; and the Trustee shall authenticate and deliver such
Notes upon a written order of the Company signed by an Officer of the Company
(an "Authentication Order"). Such Authentication Order shall specify the amount
of Notes to be authenticated and the date on which the Notes are to be
authenticated and whether the Notes are to be issued as one or more Global Notes
and such other information as the Company may include or the Trustee may
reasonably request. The aggregate principal amount of Notes that may be
outstanding under this Indenture at any time may not exceed $632,500,000, except
as provided in Section 2.08.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or
Affiliates of the Company.
Section 2.03. Registrar; Conversion Agent; and Paying Agent.
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange or conversion
("Registrar" and with respect to conversion, "Conversion Agent") and an office
or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer, exchange and
conversion (the register maintained in such office, the "Note Register"). The
Company may appoint one or more co-registrars or conversion agents and one or
more additional paying agents. The term "Registrar" includes any co-registrar,
the term "Conversion Agent" includes any co-conversion agent and the term
"Paying
12
Agent" includes any additional paying agent. The Company may change any
Paying Agent, Registrar or Conversion Agent without notice to any Holder. The
Company shall promptly notify the Trustee in writing of the name and address of
any Agent not a party to this Indenture. If the Company fails to appoint or
maintain another entity as Registrar, Paying Agent or Conversion Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act as
Paying Agent, Registrar or Conversion Agent.
The Company initially appoints DTC to act as Depositary with respect to
the Global Notes.
The Company initially appoints the Trustee to act as the Registrar,
Paying Agent and Conversion Agent and to act as custodian with respect to the
Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary) shall have no further
liability for the money. If the Company or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA s. 312(a). If the Trustee is not
the Registrar, the Company shall furnish to the Trustee at least seven Business
Days before each interest payment date and at such other times as the Trustee
may request in writing, a list in such form and as of such date as the Trustee
may reasonably require of the names and addresses of the Holders of Notes and
the Company shall otherwise comply with TIA s. 312(a).
Section 2.06. Global Notes; Non-global Notes; Book-entry Provisions.
(1) Global Notes
(i) Each Global Note authenticated under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Note or a
13
nominee thereof and delivered to such Depositary or a nominee thereof or
custodian therefor, and each such Global Note shall constitute a single
Note for all purposes of this Indenture.
(ii) Except for exchanges of Global Notes for definitive, Non-global
Notes at the sole discretion of the Company, no Global Note may be
exchanged in whole or in part for registered Notes, and no transfer of a
Global Note in whole or in part may be registered, in the name of any
Person other than the Depositary for such Global Note or a nominee thereof
unless (A) such Depositary (i) has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Note or (ii)
has ceased to be a clearing agency registered as such under the Exchange
Act or announces an intention permanently to cease business or does in fact
do so or (B) there shall have occurred and be continuing an Event of
Default with respect to such Global Note. In case of an event under clause
(A) of the preceding sentence, if a successor Depositary for such Global
Note is not appointed by the Company within 90 days after the Company
receives such notice or becomes aware of such ineligibility, the Company
will execute, and the Trustee, upon receipt of an Officers' Certificate
directing the authentication and delivery of Notes, will authenticate and
deliver, Notes, in any authorized denominations in an aggregate principal
amount equal to the principal amount of such Global Note in exchange for
such Global Note.
(iii) If any Global Note is to be exchanged for other Notes or
canceled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Trustee, as Note Registrar, for exchange
or cancellation, as provided in this Article 2. If any Global Note is to be
exchanged for other Notes or canceled in part, or if another Note is to be
exchanged in whole or in part for a beneficial interest in any Global Note,
in each case, as provided in Section 2.07, then either (A) such Global Note
shall be so surrendered for exchange or cancellation, as provided in this
Article 2, or (B) the principal amount thereof shall be reduced or
increased by an amount equal to the portion thereof to be so exchanged or
canceled, or equal to the principal amount of such other Note to be so
exchanged for a beneficial interest therein, as the case may be, by means
of an appropriate adjustment made on the records of the Trustee, as
Registrar, whereupon the Trustee, in accordance with the Applicable
Procedures, shall instruct the Depositary or its authorized representative
to make a corresponding adjustment to its records. Upon any such surrender
or adjustment of a Global Note, the Trustee shall, subject to the other
provisions in this Article 2, authenticate and deliver any Notes issuable
in exchange for such Global Note (or any portion thereof) to or upon the
order of, and registered in such names as may be directed by, the
Depositary or its authorized representative. Upon the request of the
Trustee in connection with the occurrence of any of the events specified in
the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Notes that are not in the form of Global
Notes. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its
14
authorized representative which is given or made pursuant to this Article 2
if such order, direction or request is given or made in accordance with the
Applicable Procedures.
(iv)Every Note authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Note or any portion
thereof, whether pursuant to this Article 2 or otherwise, shall be
authenticated and delivered in the form of, and shall be, a registered
Global Note, unless such Note is registered in the name of a Person other
than the Depositary for such Global Note or a nominee thereof, in which
case such Note shall be authenticated and delivered in definitive, fully
registered form, without interest coupons.
(v) The Depositary or its nominee, as registered owner of a Global
Note, shall be the Holder of such Global Note for all purposes under the
Indenture and the Notes, and owners of beneficial interests in a Global
Note shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Note will be
shown only on, and the transfer of such interest shall be effected only
through, records maintained by the Depositary or its nominee or its Agent
Members and such owners of beneficial interests in a Global Note will not
be considered the owners or holders thereof.
(2) Non-global Notes. Notes issued upon the events described in Section
2.06(1)(ii) shall be in definitive, fully registered form, without interest
coupons.
Section 2.07. Registration; Registration of Transfer and Exchange.
Upon surrender for registration of transfer of any Note at an office or
agency of the Company designated pursuant to Section 2.03 for such purpose, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Notes of any
authorized denominations and of a like aggregate principal amount.
At the option of the Holder, and subject to the other provisions of this
Section 2.07, Notes may be exchanged for other Notes of any authorized
denomination and of a like aggregate principal amount, upon surrender of the
Notes to be exchanged at any such office or agency. Whenever any Notes are so
surrendered for exchange, and subject to the other provisions of this Section
2.07, the Company shall execute, and the Trustee shall authenticate and deliver,
the Notes which the Holder making the exchange is entitled to receive. Every
Note presented or surrendered for registration of transfer or for exchange shall
(if so required by the Company or the Registrar) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company, the Trustee and the Registrar duly executed, by the Holder thereof or
his attorney duly authorized in writing.
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All Notes issued upon any registration of transfer or exchange of Notes
shall be the legal, valid and binding obligations of the Company, evidencing the
same debt and entitled to the same benefits under this Indenture as the Notes
surrendered upon such registration of transfer or exchange.
No service charge shall be made to a Holder for any registration of
transfer or exchange of Notes except as provided in Section 2.08, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Notes, other than exchanges pursuant to Sections 2.06,
9.05, 10.02 or 11.03 (other than where the shares of Common Stock are to be
issued or delivered in a name other than that of the Holder of the Note) not
involving any transfer and other than any stamp and other duties, if any, which
may be imposed in connection with any such transfer or exchange by the United
States or any political subdivision thereof or therein, which shall be paid by
the Company.
In the event of a redemption of the Notes, neither the Company nor the
Registrar will be required (a) to register the transfer of or exchange Notes for
a period of 15 days immediately preceding the date notice is given identifying
the serial numbers of the Notes called for such redemption or (b) to register
the transfer of or exchange any Note, or portion thereof, called for redemption.
Section 2.08. Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company and the Trustee may charge for their expenses in replacing
a Note.
Every replacement Note is an additional legally binding obligation of
the Company and shall be entitled to all of the benefits of this Indenture
equally and proportionately with all other Notes duly issued hereunder.
Section 2.09. Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions of
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this Indenture, and those described in this Section as not outstanding. Except
as set forth in Section 2.10, a Note does not cease to be outstanding because
either of the Company or an Affiliate of the Company holds the Note.
If a Note is replaced pursuant to Section 2.08, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a Redemption Date, Repurchase Date or
maturity date, money, or in the case of a repurchase and subject to the
conditions set forth in Article 11, shares of Common Stock, sufficient to pay
Notes payable on that date, then on and after that date such Notes shall be
deemed to be no longer outstanding and shall cease to accrue interest.
If a Note is converted into Common Stock pursuant to Article 10, it
ceases to be outstanding and interest on it ceases to accrue on the day of
surrender of such Note or conversion.
Section 2.10. Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, or whether the Holders
of the requisite principal amount of outstanding Notes are present at a meeting
of Holders of Notes for quorum purposes, Notes owned by the Company, or by any
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company, shall be considered as though not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, or any
such determination as to the presence of a quorum, only Notes that a Responsible
Officer of the Trustee knows are so owned shall be so disregarded.
Section 2.11. Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
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Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
Section 2.12. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar, Conversion Agent and Paying Agent shall forward to
the Trustee any Notes surrendered to them for registration of transfer,
exchange, conversion or payment. The Trustee and no one else shall cancel all
Notes surrendered for registration of transfer, exchange, conversion, payment,
replacement or cancellation and shall dispose of such canceled Notes in its
customary manner. The Company may not issue new Notes to replace Notes that it
has paid or that have been delivered to the Trustee for cancellation.
Section 2.13. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01. The Company shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date; provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
Section 2.14. Computation of Interest.
Interest on the Notes shall be computed on the basis of a 360-day year
of twelve 30-day months.
Section 2.15. CUSIP Numbers.
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed in the Notes or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on
the Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Trustee of any
change in the "CUSIP" numbers.
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ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07, it shall furnish to the Trustee, at least
30 days but not more than 60 days before a Redemption Date, an Officers'
Certificate setting forth (i) the clause of this Indenture pursuant to which the
redemption shall occur, (ii) the Redemption Date, (iii) the principal amount of
Notes to be redeemed and (iv) the Redemption Price.
Section 3.02. Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee shall select the Notes to be redeemed
or purchased among the Holders of the Notes in compliance with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and appropriate. In
the event of partial redemption by lot, the particular Notes to be redeemed
shall be selected, unless otherwise provided herein, not less than 30 nor more
than 60 days prior to the Redemption Date by the Trustee from the outstanding
Notes not previously called for redemption. If any Note selected for partial
redemption is converted in part before termination of the conversion right with
respect to the portion of the Note so selected, the converted portion of such
Note shall be deemed (so far as may be) to be the portion selected for
redemption. Notes which have been converted during a selection of Notes to be
redeemed may be treated by the Trustee as outstanding for the purpose of such
selection.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date, the
Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address.
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The notice shall identify the Notes (including applicable CUSIP numbers)
to be redeemed and shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the Redemption Date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the Redemption Price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
Redemption Date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant
to which the Notes called for redemption are being redeemed;
(h) that no representation is made as to the correctness or accuracy of
the CUSIP number, if any, listed in such notice or printed on the Notes; and
(i) the Conversion Rate, the date on which the right to convert the
Notes to be redeemed will terminate and the places where Notes may be
surrendered for conversion or the procedures for surrendering Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days prior to the
Redemption Date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
Section 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become irrevocably due and payable on the Redemption
Date at the Redemption Price. A notice of redemption may not be conditional.
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Section 3.05. Deposit of Redemption Price.
At or prior to 10:00 a.m., New York City time, on the Redemption Date,
the Company shall deposit with the Trustee or with the Paying Agent money
sufficient to pay the Redemption Price of and accrued interest on all Notes to
be redeemed on that date. The Trustee or the Paying Agent shall promptly return
to the Company any money deposited with the Trustee or the Paying Agent by the
Company in excess of the amounts, including but not limited to any amounts in
respect of Notes that are converted (subject to Section 10.02), necessary to pay
the Redemption Price of, and accrued interest on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph,
on and after the Redemption Date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after a
Regular Record Date but on or prior to the related Interest Payment Date, then
any accrued and unpaid interest shall be paid to the Person in whose name such
Note was registered at the close of business on such Regular Record Date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the Redemption Date and
such Note shall remain convertible until such principal is paid, and to the
extent lawful on any interest not paid on such unpaid principal, in each case at
the rate provided in the Notes and in Section 4.01.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption.
(a) The Company shall not have the option to redeem the Notes pursuant
to this Section 3.07 prior to June 4, 2004. Thereafter, the Company shall have
the option to redeem the Notes, in whole or in part, in cash upon not less than
30 nor more than 60 days' notice, at the Redemption Prices (expressed as
percentages of principal amount) set forth below plus accrued and unpaid
interest thereon, if any, to the applicable Redemption Date, if redeemed during
the twelve-month period beginning on June 4 of the years indicated below:
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Year Percentage
---- ----------
2004 101.900%
2005 100.950%
(b) Any redemption pursuant to this Section 3.07 shall be made pursuant
to the provisions of Section 3.01 through 3.06.
Section 3.08. Conversion Arrangement on Call for Redemption.
In connection with any redemption of Notes, the Company may arrange for
the purchase and conversion of any Notes by an agreement with one or more
investment bank or other purchasers (the "Arrangement Purchasers") to purchase
such securities by paying to the Trustee in trust for the Holders thereof, on or
before the Redemption Date an amount not less than the applicable Redemption
Price, together with interest accrued to the Redemption Date of such Notes.
Notwithstanding anything to the contrary contained in this Article 3, the
obligation of the Company to pay the Redemption Price, together with the
interest accrued to the Redemption Date, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such Arrangement Purchasers.
If such an agreement is entered into (a copy of which shall be filed with the
Trustee prior to the close of business on the Business Day immediately prior to
the Redemption Date), any Notes called for redemption that are not duly
surrendered for conversion by the Holders thereof may, at the option of the
Company, be deemed, to the fullest extent permitted by law and consistent with
any agreement or agreements with such Arrangement Purchasers, to be acquired by
such Arrangement Purchasers from such Holders and (notwithstanding anything to
the contrary contained in Article 10) surrendered by such Arrangement Purchasers
for conversion, all as of immediately prior to the close of business on the
Redemption Date (and the right to convert any such Notes shall be extended
through such time), subject to payment of the above amount as aforesaid. At the
direction of the Company, the Trustee shall hold and dispose of any such amount
paid to it by the Arrangement Purchasers to such Holders in the same manner as
it would monies deposited with it by the Company for the redemption of Notes.
Without the Trustee's prior written consent, no arrangement between the Company
and such Arrangement Purchasers for the purchase and conversion of any Notes
shall increase or otherwise affect any of the powers, duties, responsibilities
or obligations of the Trustee as set forth in this Indenture, and the Company
agrees to indemnify the Trustee from, and hold it harmless against, any loss,
liability or expense arising out of or in connection with any such arrangement
for the purchase and conversion of any Notes between the Company and such
Arrangement Purchasers, including the costs and expenses, including reasonable
legal fees, incurred by the Trustee in the defense of any claim or liability
arising out of or in connection with the exercise or performance of any of its
powers, duties, responsibilities or obligations under this Indenture.
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Section 3.09. Mandatory Redemption.
Except as otherwise provided in Article 11, the Company shall not be
required to make mandatory redemption payments with respect to the Notes.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay or cause to be paid the principal, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. New York City time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; the Company shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
conversion, redemption, repurchase, registration of transfer or for exchange and
where notices and demands to or upon the Company in respect of the Notes and
this Indenture may be served. The Company shall give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such
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designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in the Borough of Manhattan, The City
of New York for such purposes. The Company shall give prompt written notice to
the Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.
The Company hereby designates The Bank of New York, an affiliate of the
Trustee, as one such office or agency of the Company in accordance with Section
2.03.
Section 4.03. Reports.
The Company shall file with the Trustee and the Commission, and transmit
to Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the TIA at the times and in the manner
provided pursuant to the TIA; provided that any such information, documents or
reports required to be filed with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act shall be filed with the trustee within 15 days after the
same is so required to be filed with the Commission.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 4.04. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
have been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes are
prohibited or if such event has
24
occurred, a description of the event and what action the Company is taking or
proposes to take with respect thereto.
(b) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.07. Corporate Existence.
Subject to Article 5, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of its
Significant Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Significant Subsidiary and (ii) the rights (charter and statutory),
licenses and franchises of the Company and its Significant Subsidiaries;
provided, however, that the Company shall not be required to preserve any such
right, license or franchise, or the corporate, partnership or other existence of
any of its Significant Subsidiaries, if the Board of Directors of the Company
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Significant Subsidiaries, taken
as a whole, and that the loss thereof is not adverse in any material respect to
the Holders.
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Section 4.08. Payments for Consent.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration to or for the
benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid and is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or amendment.
Section 4.09. Registration and Listing.
The Company (i) will effect all registrations with, and obtain all
approvals by, all governmental authorities that may be necessary under any
United States Federal or state law (including the Securities Act, the Exchange
Act and state securities and Blue Sky laws) before the shares of Common Stock
issuable upon conversion of Notes are issued and delivered, and qualified or
listed as contemplated by clause (ii); and (ii) will qualify the shares of
Common Stock required to be issued and delivered upon conversion of Notes, prior
to such issuance or delivery, for quotation on the Nasdaq National Market or, if
the Common Stock is not then quoted on the Nasdaq National Market, list the
Common Stock on each national securities exchange or quotation system on which
outstanding Common Stock is listed or quoted at the time of such delivery.
Section 4.10. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
covenant or condition set forth in Sections 4.05 and 4.07 (other than with
respect to the existence of the Company (subject to Article 5)) (other than a
covenant or condition which under Article 9 cannot be modified or amended
without the consent of the Holder of each outstanding Note affected), if before
the time for such compliance the Holders shall either (i) through the written
consent (or as otherwise in accordance with the Applicable Procedures) of the
Holders of at least a majority in aggregate principal amount of the Notes then
outstanding or (ii) by the adoption of a resolution, at a meeting of Holders of
the outstanding Notes at which a quorum is present, by the Holders of at least
66 2/3% in principal amount of the outstanding Notes represented at such meeting
or, if less, by the Holders of at least a majority in aggregate principal amount
of all outstanding Notes, either waive such compliance in such instance or
generally waive compliance with such covenant or condition, but no such waiver
shall extend to or affect such covenant or condition except to the extent so
expressly waived and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee or any Paying or Conversion Agent
in respect of any such covenant or condition shall remain in full force and
effect.
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ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets.
The Company may not, directly or indirectly: (1) consolidate or merge
with or into another Person (whether or not the Company is the surviving
corporation); or (2) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of its properties or assets, in one or more related
transactions, to another Person; unless:
(1) either: (a) the Company is the surviving corporation; or (b) the
Person formed by or surviving any such consolidation or merger (if other than
the Company) or to which such sale, assignment, transfer, conveyance or other
disposition shall have been made is a Person organized or existing under the
laws of the United States, any state thereof or the District of Columbia
(provided that if the Person formed by or surviving any such consolidation or
merger with the Company is not a corporation, a corporate co-issuer shall also
be an obligor with respect to the Notes);
(2) the Person formed by or surviving any such consolidation or merger
(if other than the Company) or the Person to which such sale, assignment,
transfer, conveyance or other disposition shall have been made assumes all the
obligations of the Company under the Notes and this Indenture pursuant to
agreements reasonably satisfactory to the Trustee; and
(3) immediately after such transaction, no Default or Event of Default
exists.
In addition, the Company may not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person.
This Section 5.01 shall not apply to a sale, assignment, transfer,
conveyance or other disposition of assets between or among (i) the Company and
Charter Communications Holding Company, LLC or (ii) the Company and any
wholly-owned Subsidiary of Charter Communications Holding Company, LLC.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in accordance with Section 5.01, the successor Person formed by
such consolidation or into which the Company is merged or to which such transfer
is made shall succeed to and (except in the case of a lease) be substituted for,
and may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor Person had been named therein as the
Company, and (except in the case of a lease) the Company
27
shall be released from the obligations under the Notes and this Indenture,
except with respect to any obligations that arise from, or are related to, such
transaction.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of interest on the
Notes and such default continues for a period of 30 days;
(b) the Company defaults in payment when due of the principal of or
premium, if any, on the Notes;
(c) the Company fails to comply with any of the notice or repurchase
provisions of Article 11;
(d) the Company fails to comply with any of its other covenants or
agreements in this Indenture for 30 days after written notice thereof has been
given to the Company by the Trustee or to the Company and the Trustee by Holders
of at least 25% of the aggregate principal amount of the Notes outstanding;
(e) the Company or any of its Significant Subsidiaries defaults under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed (or
the payment of which is guaranteed by the Company or any of its Significant
Subsidiaries) whether such Indebtedness or guarantee now exists or is created
after the Issue Date, if that default:
(1) is caused by a failure to pay at final stated maturity the
principal amount on such Indebtedness prior to the expiration of the grace
period provided in such Indebtedness on the date of such default (a
"Payment Default"); or
(2) results in the acceleration of such Indebtedness prior to its
express maturity,
and, in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more;
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(f) the Company or any of its Significant Subsidiaries pursuant to or
within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property, or
(iv) makes a general assignment for the benefit of its creditors; or
(g) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries in an involuntary case;
(ii) appoints a custodian of the Company or any of its Significant
Subsidiaries or for all or substantially all of the property of the Company
or any of its Significant Subsidiaries; or
(iii) orders the liquidation of the Company or any of its Significant
Subsidiaries;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Section 6.02. Acceleration.
In the case of an Event of Default arising from clause (f) or (g) of
Section 6.01 with respect to the Company, all outstanding Notes shall become due
and payable immediately without further action or notice. If any other Event of
Default occurs and is continuing, the Trustee by notice to the Company or the
Holders of at least 25% in principal amount of the then outstanding Notes by
notice to the Company and the Trustee may declare all the Notes to be due and
payable immediately. The Holders of a majority in aggregate principal amount of
the Notes then outstanding by written notice to the Trustee may on behalf of all
of the Holders rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal, interest or premium that has become due
solely because of the acceleration) have been cured or waived.
29
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Existing Defaults.
Holders, either (i) through the written consent (or as otherwise in
accordance with the Applicable Procedures) of the Holders of at least a majority
in aggregate principal amount of the then outstanding Notes (including, without
limitation, consents obtained in connection with a purchase of, or a tender
offer or exchange offer for, the Notes) by notice to the Trustee or (ii) by the
adoption of a resolution, at a meeting of Holders of the outstanding Notes at
which a quorum is present, by the Holders of at least 66 2/3% in principal
amount of the outstanding Notes represented at such meeting or, if less, by the
Holders of at least a majority in aggregate principal amount of all outstanding
Notes by notice to the Trustee, may on behalf of the Holders of all of the Notes
waive an existing Default or Event of Default and its consequences hereunder,
except (x) a continuing Default or Event of Default in the payment of the
principal of, premium, if any, or interest on, the Notes (including in
connection with an offer to purchase) or (y) in respect of a covenant or
provision hereof which under Article 9 cannot be modified or amended without the
consent of each Holder of each outstanding Note affected (provided, however,
that the Holders of a majority in aggregate principal amount of the then
outstanding Notes may rescind an acceleration and its consequences, including
any related payment default that resulted from such acceleration). Upon any such
waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section 6.05. Control by Majority.
Holders of a majority in principal amount of the then outstanding Notes
may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture, that the Trustee determines may be
prejudicial to the rights of other Holders of
30
Notes or that may involve the Trustee in personal liability. The Trustee may
take any other action which it deems proper that is not inconsistent with any
such directive.
Section 6.06. Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment and to Convert.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium, if any, and interest
on the Note, on or after the Stated Maturity dates (including in connection with
a redemption and/or an offer to purchase), or to convert such Note in accordance
with Article 10, or to bring suit for the enforcement of any such payment on or
after such respective dates or of such right to convert, shall be absolute and
unconditional and shall not be impaired or affected without the consent of such
Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs
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and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 out of the estate in any such
proceeding, shall be denied for any reason, payment of the same shall be secured
by a lien on, and shall be paid out of, any and all distributions, dividends,
money, securities and other properties that the Holders may be entitled to
receive in such proceeding whether in liquidation or under any plan of
reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Notes for principal, premium, if any and interest, respectively; and
32
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07, or a suit by Holders of more than 10%
in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions required to
be furnished to the Trustee hereunder and conforming to the requirements of
this Indenture. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the
33
requirements of this Indenture (but need not confirm or investigate the
accuracy of any mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liabilities for its own gross
negligent action, its own gross negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was grossly negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability, claim,
damage or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or documents.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely upon any document (whether in its
original or facsimile form) believed by it to be genuine and to have been signed
or presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or
34
Opinion of Counsel. The Trustee may consult with counsel of its own selection
and the written advice or opinion of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection from liability in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it against the costs, expenses
and liabilities that might be incurred by it in compliance with such request or
direction.
(g) The Trustee shall not be charged with knowledge of any Default or
Event of Default unless either (i) a Responsible Officer of the Trustee shall
have actual knowledge of such Default or Event of Default or (ii) written notice
of such Default or Event of Default shall have been given to and received by a
Responsible Officer of the Trustee by the Company or any Holder.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Company or any Affiliate of
the Company with the same rights it would have if it were not Trustee. However,
in the event that the Trustee acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the Commission for permission
to continue as trustee or resign. Any Agent may do the same with like rights and
duties. The Trustee is also subject to Sections 7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be
35
responsible for the use or application of any money received by any Paying Agent
other than the Trustee, and it shall not be responsible for any statement or
recital herein or any statement in the Notes or any other document in connection
with the sale of the Notes or pursuant to this Indenture other than its
certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to a Responsible Officer of the Trustee, the Trustee shall mail to Holders
of Notes a notice of the Default or Event of Default within 90 days after the
Trustee acquires knowledge thereof. Except in the case of a Default or Event of
Default in payment of principal of, premium, if any, or interest on any Note,
the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders of the Notes.
Section 7.06. Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15 beginning with the May 15 following the
date of this Indenture, and for so long as Notes remain outstanding, the Trustee
shall mail to the Holders of the Notes a brief report dated as of such reporting
date that complies with TIA s. 313(a) (but if no event described in TIA s.
313(a) has occurred within the twelve months preceding the reporting date, no
report need be transmitted). The Trustee also shall comply with TIA s.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA s. 313(c).
A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the Commission and each stock
exchange on which the Notes are listed in accordance with TIA s. 313(d). The
Company shall promptly notify the Trustee when the Notes are listed on any stock
exchange or delisted therefrom.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee reasonable compensation for its
acceptance of this Indenture and from time to time reasonable compensation for
its services hereunder. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee promptly upon request for all reasonable disbursements,
advances and expenses incurred or made by it in addition to the compensation for
its services. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
The Company shall fully indemnify the Trustee against any and all
losses, liabilities, claims, damages or expenses (including reasonable legal
fees and expenses) incurred by it arising out of or in connection with the
acceptance or administration of its
36
duties under this Indenture, including the costs and expenses of enforcing this
Indenture against the Company (including this Section 7.07) and defending itself
against any claim (whether asserted by the Company or any Holder or any other
person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its gross negligence or willful misconduct. The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Company shall not relieve the
Company of its obligations hereunder. The Company shall defend the claim and the
Trustee shall cooperate in the defense. The Trustee may have separate counsel
and the Company shall pay the reasonable fees and expenses of such counsel. The
Company need not pay for any settlement made without their consent, which
consent shall not be unreasonably withheld.
The obligations of the Company in this Section 7.07 shall survive
resignation or removal of the Trustee and the satisfaction and discharge of this
Indenture.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and interest on
particular Notes. Such lien shall survive the resignation or removal of the
Trustee and the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(f) or (g) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA s. 313(b)(2) to the
extent applicable.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company in writing. The Company may remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10;
37
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition at the expense of the Company any court of competent jurisdiction
for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee; provided all sums owing to the
Trustee hereunder have been paid and subject to the lien provided for in Section
7.07. Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to
38
supervision or examination by federal or state authorities and that has a
combined capital and surplus of at least $50 million as set forth in its most
recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA s. 310(a)(1), (2) and (5). The Trustee is subject to TIA s.
310(b).
Section 7.11. Preferential Collection of Claims Against the Company.
The Trustee is subject to TIA s. 311(a), excluding any creditor
relationship listed in TIA s. 311(b). A Trustee who has resigned or been removed
shall be subject to TIA s. 311(a) to the extent indicated therein.
ARTICLE 8
MEETINGS OF HOLDERS OF NOTES
Section 8.01. Purposes for Which Meetings May Be Called.
A meeting of Holders of Notes may be called at any time and from time to
time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Notes.
Section 8.02. Call, Notice and Place of Meetings.
(1) The Trustee may at any time call a meeting of Holders of Notes for
any purpose specified in Section 8.01, to be held at such time and at such place
in the Borough of Manhattan, The City of New York, as the Trustee shall
determine. Notice of every meeting of Holders of Notes, setting forth the time
and the place of such meeting and in general terms the action proposed to be
taken at such meeting, shall be given, in the manner provided in Section 12.02,
not less than 21 nor more than 180 days prior to the date fixed for the meeting.
(2) In case at any time the Company, pursuant to a Board Resolution, or
the Holders of at least 10% in principal amount of the outstanding Notes shall
have requested the Trustee to call a meeting of the Holders of Notes for any
purpose specified in Section 8.01, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed the notice of such meeting within 21 days after
receipt of such request or shall not thereafter proceed to cause the meeting to
be held as provided herein, then the Company or the Holders of Notes in the
amount specified, as the case may be, may determine the time and the place in
the Borough of
39
Manhattan, The City of New York, for such meeting and may call such meeting for
such purposes by giving notice thereof as provided in paragraph (1) of this
Section.
Section 8.03. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Notes, a Person
shall be (i) a Holder of one or more outstanding Notes, or (ii) a Person
appointed by an instrument in writing as proxy for a Holder or Holders of one or
more outstanding Notes by such Holder or Holders. The only Persons who shall be
entitled to be present or to speak at any meeting of Holders shall be the
Persons entitled to vote at such meeting and their counsel, any representatives
of the Trustee and its counsel and any representatives of the Company and its
counsel.
Section 8.04. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
outstanding Notes shall constitute a quorum. In the absence of a quorum within
30 minutes of the time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Notes, be dissolved. In any other case,
the meeting may be adjourned for a period of not less than 10 days as determined
by the chairman of the meeting prior to the adjournment of such meeting. In the
absence of a quorum at any such adjourned meeting, such adjourned meeting may be
further adjourned for a period not less than 10 days as determined by the
chairman of the meeting prior to the adjournment of such adjourned meeting
(subject to repeated applications of this sentence). Notice of the reconvening
of any adjourned meeting shall be given as provided in Section 8.02(1), except
that such notice need be given only once not less than five days prior to the
date on which the meeting is scheduled to be reconvened. Notice of the
reconvening of an adjourned meeting shall state expressly the percentage of the
principal amount of the outstanding Notes which shall constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting adjourned
for a lack of a quorum, the Persons entitled to vote 25% in principal amount of
the outstanding Notes at the time shall constitute a quorum for the taking of
any action set forth in the notice of the original meeting.
At a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid, any resolution and all matters (other than a
covenant or condition which under Section 9.02 cannot be modified or amended
without the consent of the Holder of each outstanding Note affected) shall be
effectively passed and decided if passed or decided by the lesser of (i) the
Holders of not less than a majority in principal amount of outstanding Notes and
(ii) the Persons entitled to vote not less than 66-2/3% in principal amount of
outstanding Notes represented and entitled to vote at such meeting.
40
Any resolution passed or decisions taken at any meeting of Holders of
Notes duly held in accordance with this Section shall be binding on all the
Holders of Notes whether or not present or represented at the meeting. The
Trustee shall, in the name and at the expense of the Company, notify all the
Holders of Notes of any such resolutions or decisions pursuant to Section 12.02.
Section 2.09 shall determine which Notes are considered to be
"outstanding" for purposes of this Section 8.04.
Section 8.05. Determination of Voting Rights; Conduct and Adjournment of
Meetings.
(1) Notwithstanding any other provisions of this Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting of
Holders of Notes in regard to proof of the holding of Notes and of the
appointment of proxies and in regard to the appointment and duties of inspectors
of votes, the submission and examination of proxies, certificates and other
evidence of the right to vote, and such other matters concerning the conduct of
the meeting as it shall deem appropriate.
(2) The Trustee shall, by an instrument in writing, appoint a temporary
chairman (which may be the Trustee) of the meeting, unless the meeting shall
have been called by the Company or by Holders of Notes as provided in Section
8.02(2), in which case the Company or the Holders of Notes calling the meeting,
as the case may be, shall in like manner appoint a temporary chairman. A
permanent chairman and a permanent secretary of the meeting shall be elected by
vote of the Persons entitled to vote a majority in principal amount of the
outstanding Notes represented at the meeting.
(3) At any meeting, each Holder of a Note or holder of a proxy therefor
shall be entitled to one vote for each U.S. $1,000 principal amount of Notes
held or represented by him; provided, however, that no vote shall be cast or
counted at any meeting in respect of any Note challenged as not outstanding and
ruled by the chairman of the meeting to be not outstanding. The chairman of the
meeting shall have no right to vote, except as a Holder of a Note or holder of a
proxy therefor.
(4) Any meeting of Holders of Notes duly called pursuant to Section 8.02
at which a quorum is present may be adjourned from time to time by Persons
entitled to vote a majority in principal amount of the outstanding Notes
represented at the meeting, and the meeting may be held as so adjourned without
further notice.
Section 8.06. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Notes shall be by written ballots on which shall be subscribed the signatures of
the Holders of Notes or of their representatives by proxy and the principal
amounts at Stated Maturity and serial numbers of the outstanding Notes held or
represented by them. The permanent
41
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record, at least in duplicate, of
the proceedings of each meeting of Holders of Notes shall be prepared by the
secretary of the meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more Persons having knowledge of the facts setting forth a
copy of the notice of the meeting and showing that said notice was given as
provided in Section 8.02 and, if applicable, Section 8.04. Each copy shall be
signed and verified by the affidavits of the permanent chairman and secretary of
the meeting and one such copy shall be delivered to the Company and another to
the Trustee to be preserved by the Trustee, the latter to have attached thereto
the ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(c) to provide for the assumption of the Company's obligations to
Holders of Notes in the case of a merger or consolidation or sale of all or
substantially all of the assets of the Company pursuant to Article 5;
(d) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under this Indenture of any such Holder;
(e) to comply with requirements of the Commission in order to effect or
maintain the qualification of this Indenture under the TIA or otherwise as
necessary to comply with applicable law;
42
(f) to make provision with respect to the conversion rights of Holders
of Notes pursuant to Section 10.11 or to make provision with respect to the
repurchase rights of Holders of Notes pursuant to Section 11.04; or
(g) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee.
Upon the request of the Company accompanied by a resolution of its Board
of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02, the Trustee shall join with the Company in the execution of any amended or
supplemental Indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations that may be
therein contained, but the Trustee shall not be obligated to enter into such
amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes.
Except as provided below in this Section 9.02, this Indenture or the
Notes may be amended or supplemented with either (i) the written consent (or as
otherwise in accordance with the Applicable Procedures) of the Holders of at
least a majority in aggregate principal amount of the Notes then outstanding
(including, without limitation, consents obtained in connection with a purchase
of, or a tender offer or exchange offer for, Notes), or (ii) by the adoption of
a resolution, at a meeting of Holders of the outstanding Notes at which a quorum
is present, by the Holders of at least 66 2/3% in principal amount of the
outstanding Notes represented at such meeting or, if less, by the Holders of at
least a majority in aggregate principal amount of all outstanding Notes. Section
2.09 shall determine which Notes are considered to be "outstanding" for purposes
of this Section 9.02.
Upon the request of the Company accompanied by a resolution of its Board
of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02, the Trustee shall join
with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated to, enter into
such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
supplement, but it shall be sufficient if such consent approves the substance
thereof.
43
After an amendment or supplement under this Section 9.02 becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment or supplement. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amended or supplemental Indenture.
However, without the consent or affirmative vote of each Holder
affected, an amendment or supplement under this Section 9.02 may not (with
respect to any Notes held by a non-consenting Holder):
(a) change the Stated Maturity of the principal of, or any installment
of interest on, any Note, or reduce the principal amount of, or the premium, if
any, or the rate of interest payable thereon, or reduce the amount payable upon
a redemption or Change of Control, or change the place or currency of payment of
the principal of, premium, if any, or interest on any Note (including any
payment of Redemption Price or Repurchase Price in respect of such Note) or
impair the right to institute suit for the enforcement of any payment in respect
of any Note on or after the Stated Maturity thereof (or, in the case of
redemption or any repurchase, on or after the Redemption Date or Repurchase
Date, as the case may be) or, except as permitted by Section 10.11, adversely
affect the right of Holders to convert any Note as provided in Article 10; or
(b) reduce the requirements of Section 8.04 for quorum or voting, or
reduce the percentage in principal amount of the outstanding Notes the consent
of whose Holders is required for any such supplemental indenture or the consent
of whose Holders is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences provided for in this Indenture; or
(c) modify the obligation of the Company to maintain an office or agency
in the Borough of Manhattan, The City of New York, pursuant to Section 4.02; or
(d) modify any of the provisions of this Section or Section 4.10 or
6.04, except to increase any percentage contained herein or therein or to
provide that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each outstanding Note affected
thereby; or
(e) modify the provisions of Article 11 relating to notice and
repurchase (including, without limitation, those relating to the Repurchase Date
and the Repurchase Price (whether payable in cash or shares of Common Stock)) in
a manner adverse to the Holders.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be
set forth in an amended or supplemental Indenture that complies with the TIA as
then in effect.
44
Section 9.04. Revocation and Effect of Consents.
Until an amendment or supplement becomes effective, a consent to it by a
Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the supplement or amendment becomes effective. An
amendment or supplement becomes effective in accordance with its terms and
thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment or
supplement on any Note thereafter authenticated. The Company in exchange for all
Notes may issue and the Trustee shall, upon receipt of an Authentication Order,
authenticate new Notes that reflect the amendment or supplement.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment or supplement.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01) shall be fully
protected in relying upon, in addition to the documents required by Section
10.04, an Officer's Certificate and an Opinion of Counsel stating that the
execution of such amended or supplemental indenture is authorized or permitted
by this Indenture.
ARTICLE 10
CONVERSION OF NOTES
Section 10.01. Conversion Privilege and Conversion Rate.
Subject to and upon compliance with the provisions of this Article, at
the option of the Holder thereof, any Note may be converted into fully paid and
nonassessable shares (calculated as to each conversion to the nearest 1/100th of
a share) of Common
45
Stock of the Company at the Conversion Rate, determined as hereinafter provided,
in effect at the time of conversion. Such conversion right shall commence on the
initial issuance date of the Notes and expire at the close of business on the
Business Day prior to the date of Maturity of the Notes, subject, in the case of
conversion of any Global Note, to any Applicable Procedures. In case a Note or
portion thereof is called for redemption at the election of the Company or the
Holder thereof exercises his right to require the Company to repurchase the
Note, such conversion right in respect of the Note, or portion thereof so
called, shall expire at the close of business on the Business Day prior to the
Redemption Date or the Repurchase Date, as the case may be, unless the Company
defaults in making the payment due upon redemption or repurchase, as the case
may be (in each case subject as aforesaid to any Applicable Procedures with
respect to any Global Note).
The rate at which shares of Common Stock shall be delivered upon
conversion (herein called the "Conversion Rate") shall be initially 38.0952
shares of Common Stock for each U.S.$1,000 principal amount of Notes. The
Conversion Rate shall be adjusted in certain instances as provided in this
Article 10.
Section 10.02. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of any Note to
be converted shall surrender such Note, duly endorsed in blank, at any office or
agency of the Company maintained for that purpose pursuant to Section 4.02,
accompanied by a duly signed conversion notice substantially in the form set
forth in Exhibit A stating that the Holder elects to convert such Note or, if
less than the entire principal amount thereof is to be converted, the portion
thereof to be converted. Each Note surrendered for conversion (in whole or in
part) during the Record Date Period shall (except in the case of any Note or
portion thereof which has been called for redemption on a Redemption Date
occurring within such Record Date Period and, as a result, the right to convert
would terminate in such period) be accompanied by payment in New York Clearing
House funds or other funds acceptable to the Company of an amount equal to the
interest payable on such Interest Payment Date on the principal amount of such
Note (or part thereof, as the case may be) being surrendered for conversion,
provided that if any Note (or portion thereof) has been called for redemption on
a Redemption Date occurring during the Record Date Period, and is surrendered
for conversion during such period, the Holder of such Note on the related
Regular Record Date will be entitled to receive the interest accruing on such
Note from the Interest Payment Date next preceding the date of such conversion
to such succeeding Interest Payment Date and the Holder of such Note who
converts such Note or portion thereof during such period shall not be required
to pay such interest upon surrender of such Note for conversion. The interest so
payable on such Interest Payment Date with respect to any Note (or portion
thereof, if applicable) which is surrendered for conversion during the Record
Date Period shall be paid to the Holder of such Note as of such Regular Record
Date in an amount equal to the interest that would
46
have been payable on such Note if such Note had been converted as of the close
of business on such Interest Payment Date. Except as provided in this paragraph,
no cash payment or adjustment shall be made upon any conversion on account of
any interest accrued from the Interest Payment Date next preceding the
conversion date, in respect of any Note (or part thereof, as the case may be)
surrendered for conversion, or on account of any dividends on the Common Stock
issued upon conversion. The Company's delivery to the Holder of the number of
shares of Common Stock (and cash in lieu of fractions thereof, as provided in
this Indenture) into which a Note is convertible will be deemed to satisfy the
Company's obligation to pay the principal amount of the Note.
Notes shall be deemed to have been converted immediately prior to the
close of business on the day of surrender of such Notes for conversion in
accordance with the foregoing provisions, and at such time the rights of the
Holders of such Notes as Holders shall cease, and the Person or Persons entitled
to receive the Common Stock issuable upon conversion shall be treated for all
purposes as the record holder or holders of such Common Stock at such time. As
promptly as practicable on or after the conversion date, the Company shall issue
and deliver to the Trustee, for delivery to the Holder, a certificate or
certificates for the number of full shares of Common Stock issuable upon
conversion, together with payment in lieu of any fraction of a share, as
provided in Section 10.03.
In the case of any Note which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Note or
Notes of authorized denominations in an aggregate principal amount equal to the
unconverted portion of the principal amount of such Note. A Note may be
converted in part, but only if the principal amount of such Note to be converted
is any integral multiple of U.S. $1,000 and the principal amount of such Note to
remain outstanding after such conversion is equal to U.S. $1,000 or any integral
multiple of $1,000 in excess thereof.
Section 10.03. Fractions of Shares.
No fractional shares of Common Stock shall be issued upon conversion of
any Note or Notes. If more than one Note shall be surrendered for conversion at
one time by the same Holder, the number of full shares which shall be issuable
upon conversion thereof shall be computed on the basis of the aggregate
principal amount of the Notes (or specified portions thereof) so surrendered.
Instead of any fractional share of Common Stock which would otherwise be
issuable upon conversion of any Note or Notes (or specified portions thereof),
the Company shall calculate and pay a cash adjustment in respect of such
fraction (calculated to the nearest 1/100th of a share) in an amount equal to
the same fraction of the Closing Price Per Share at the close of business on the
day of conversion (or round up the number of shares of Common Stock issuable
upon conversion of any Note or Notes to the nearest whole share).
47
Section 10.04. Adjustment of Conversion Rate.
The Conversion Rate shall be subject to adjustments from time to time as
follows:
(1) In case the Company shall pay or make a dividend or other
distribution on shares of any class of capital stock payable in shares of Common
Stock, the Conversion Rate in effect at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased by dividing such
Conversion Rate by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the date fixed
for such determination and the denominator shall be the sum of such number of
shares and the total number of shares constituting such dividend or other
distribution, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination. If, after
any such date fixed for determination, any dividend or distribution is not in
fact paid, the Conversion Rate shall be immediately readjusted, effective as of
the date the Board of Directors determines not to pay such dividend or
distribution, to the Conversion Rate that would have been in effect if such
determination date had not been fixed. For the purposes of this paragraph (1),
the number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of shares of Common
Stock. The Company will not pay any dividend or make any distribution on shares
of Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, options or warrants to all
holders of its Common Stock entitling them to subscribe for or purchase shares
of Common Stock at a price per share less than the current market price per
share (determined as provided in paragraph (8) of this Section 10.04) of the
Common Stock on the date fixed for the determination of stockholders entitled to
receive such rights, options or warrants (other than any rights, options or
warrants that by their terms will also be issued to any Holder upon conversion
of a Note into shares of Common Stock without any action required by the Company
or any other Person), the Conversion Rate in effect at the opening of business
on the day following the date fixed for such determination shall be increased by
dividing such Conversion Rate by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of Common Stock
which the aggregate of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase would purchase at such
current market price and the denominator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such increase to become effective immediately after
the opening of business on the day following the date fixed for such
determination. If, after any such date fixed for determination, any such rights,
options or warrants are not in fact
48
issued, or are not exercised prior to the expiration thereof, the Conversion
Rate shall be immediately readjusted, effective as of the date such rights,
options or warrants expire, or the date the Board of Directors determines not to
issue such rights, options or warrants, to the Conversion Rate that would have
been in effect if the unexercised rights, options or warrants had never been
granted or such determination date had not been fixed, as the case may be. For
the purposes of this paragraph (2), the number of shares of Common Stock at any
time outstanding shall not include shares held in the treasury of the Company
but shall include shares issuable in respect of scrip certificates issued in
lieu of fractions of shares of Common Stock. The Company will not issue any
rights, options or warrants in respect of shares of Common Stock held in the
treasury of the Company.
(3) In case outstanding shares of Common Stock shall be subdivided into
a greater number of shares of Common Stock, the Conversion Rate in effect at the
opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately increased, and, conversely, in case
outstanding shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Rate in effect at the opening of business
on the day following the day upon which such subdivision or combination becomes
effective shall be proportionately reduced, such increase or reduction, as the
case may be, to become effective immediately after the opening of business on
the day following the day upon which such subdivision or combination becomes
effective.
(4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness, shares of any
class of capital stock or other property (including cash or assets or
securities, but excluding (i) any rights, options or warrants referred to in
paragraph (2) of this Section and any other rights, options or warrants that by
their terms will also be issued to any Holder upon conversion of a Note into
shares of Common Stock without any action required by the Company or any other
Person, (ii) any dividend or distribution paid exclusively in cash, (iii) any
dividend or distribution referred to in paragraph (1) of this Section and (iv)
mergers or consolidations to which Section 10.11 applies), the Conversion Rate
shall be adjusted so that the same shall equal the rate determined by dividing
the Conversion Rate in effect immediately prior to the close of business on the
date fixed for the determination of stockholders entitled to receive such
distribution by a fraction of which the numerator shall be the current market
price per share (determined as provided in paragraph (8) of this Section 10.04)
of the Common Stock on the date fixed for such determination less the then fair
market value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution filed with the Trustee) of the
portion of the assets, shares or evidences of indebtedness so distributed
applicable to one share of Common Stock and the denominator shall be such
current market price per share of the Common Stock, such adjustment to become
effective immediately prior to the opening of business on the day following the
date fixed for the determination of stockholders entitled to receive such
distribution. If after any such date fixed for determination, any such
49
distribution is not in fact made, the Conversion Rate shall be immediately
readjusted, effective as of the date the Board of Directors determines not to
make such distribution, to the Conversion Rate that would have been in effect if
such determination date had not been fixed.
(5) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock cash (excluding any cash that is distributed as
part of a distribution referred to in paragraph (4) of this Section or cash
distributed upon a merger or consolidation to which Section 10.11 applies) in an
aggregate amount that, combined together with (i) the aggregate amount of any
other all-cash distributions to all holders of its Common Stock made exclusively
in cash within the 365-day period preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to paragraphs (5)
and (6) has been made and (ii) the aggregate of any cash plus the fair market
value (as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration payable in
respect of any tender offer by the Company or any of its Subsidiaries for all or
any portion of the Common Stock concluded within the 365-day period preceding
the date of payment of such distribution and in respect of which no adjustment
pursuant to paragraphs (5) and (6) of this Section 10.04 has been made (the
"combined cash and tender amount") exceeds 12.5% of the product of the current
market price per share (determined as provided in paragraph (8) of this Section
10.04) of the Common Stock on the date for the determination of holders of
shares of Common Stock entitled to receive such distribution times the number of
shares of Common Stock outstanding on such date (the "aggregate current market
price"), then, and in each such case, immediately after the close of business on
such date for determination, the Conversion Rate shall be adjusted so that the
same shall equal the rate determined by dividing the Conversion Rate in effect
immediately prior to the close of business on the date fixed for determination
of the stockholders entitled to receive such distribution by a fraction (i) the
numerator of which shall be equal to the current market price per share
(determined as provided in paragraph (8) of this Section) of the Common Stock on
the date fixed for such determination less an amount equal to the quotient of
(x) the excess of such combined cash and tender amount over such aggregate
current market price divided by (y) the number of shares of Common Stock
outstanding on such date for determination and (ii) the denominator of which
shall be equal to the current market price per share (determined as provided in
paragraph (8) of this Section 10.04) of the Common Stock on such date fixed for
determination.
(6) In case a tender offer made by the Company or any Subsidiary for all
or any portion of the Common Stock shall expire and such tender offer (as
amended upon the expiration thereof) shall require the payment to stockholders
(based on the acceptance (up to any maximum specified in the terms of the tender
offer) of Purchased Shares (as defined below)) of an aggregate consideration
having a fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) that
combined together with (i) the aggregate of the cash plus the fair
50
market value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution), as of the expiration of such
tender offer, of consideration payable in respect of any other tender offer by
the Company or any Subsidiary for all or any portion of the Common Stock
expiring within the 365-day period preceding the expiration of such tender offer
and in respect of which no adjustment pursuant to paragraphs (5) and (6) has
been made and (ii) the aggregate amount of any cash distributions to all holders
of the Common Stock within 365-day period preceding the expiration of such
tender offer and in respect of which no adjustment pursuant to paragraphs (5)
and (6) of this Section has been made (the "combined tender and cash amount")
exceeds 12.5% of the product of the current market price per share of the Common
Stock (determined as provided in paragraph (8) of this Section 10.04) as of the
last time (the "Expiration Time") tenders could have been made pursuant to such
tender offer (as it may be amended) times the number of shares of Common Stock
outstanding (including any tendered shares) as of the Expiration Time, then, and
in each such case immediately prior to the opening of business on the day after
the date of the Expiration Time, the Conversion Rate shall be adjusted so that
the same shall equal the rate determined by dividing the Conversion Rate
immediately prior to close of business on the date of the Expiration Time by a
fraction (i) the numerator of which shall be equal to (A) the product of (I) the
current market price per share of the Common Stock (determined as provided in
paragraph (8) of this Section 10.04) on the date of the Expiration Time
multiplied by (II) the number of shares of Common Stock outstanding (including
any tendered shares) on the Expiration Time less (B) the combined tender and
cash amount, and (ii) the denominator of which shall be equal to the product of
(A) the current market price per share of the Common Stock (determined as
provided in paragraph (8) of this Section 10.04) as of the Expiration Time
multiplied by (B) the number of shares of Common Stock outstanding (including
any tendered shares) as of the Expiration Time less the number of all shares
validly tendered and not withdrawn as of the Expiration Time (the shares deemed
so accepted up to any such maximum, being referred to as the "Purchased
Shares").
(7) The reclassification of Common Stock into securities other than
Common Stock (other than any reclassification upon a consolidation or merger to
which Section 10.11 applies) shall be deemed to involve (a) a distribution of
such securities other than Common Stock to all holders of Common Stock (and the
effective date of such reclassification shall be deemed to be "the date fixed
for the determination of stockholders entitled to receive such distribution" and
"the date fixed for such determination" within the meaning of paragraph (4) of
this Section), and (b) a subdivision or combination, as the case may be, of the
number of shares of Common Stock outstanding immediately prior to such
reclassification into the number of shares of Common Stock outstanding
immediately thereafter (and the effective date of such reclassification shall be
deemed to be "the day upon which such subdivision becomes effective" or "the day
upon which such combination becomes effective", as the case may
51
be, and "the day upon which such subdivision or combination becomes effective"
within the meaning of paragraph (3) of this Section 10.04).
(8) For the purpose of any computation under paragraph (2), (4), (5) or
(6) of this Section 10.04, the current market price per share of Common Stock on
any date shall be calculated by the Company and be the average of the daily
Closing Price Per Share for the five consecutive Trading Days selected by the
Company commencing not more than 10 Trading Days before, and ending not later
than the earlier of the day in question and the day before the "ex" date with
respect to the issuance or distribution requiring such computation. For purposes
of this paragraph, the term "`ex' date", when used with respect to any issuance
or distribution, means the first date on which the Common Stock trades the
regular way in the applicable securities market or on the applicable securities
exchange without the right to receive such issuance or distribution.
(9) No adjustment in the Conversion Rate shall be required unless such
adjustment (plus any adjustments not previously made by reason of this paragraph
(9)) would require an increase or decrease of at least one percent in such rate;
provided, however, that any adjustments which by reason of this paragraph (9)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Article shall be made to
the nearest cent or to the nearest one-hundredth of a share, as the case may be.
(10) The Company may make such increases in the Conversion Rate, for the
remaining term of the Notes or any shorter term, in addition to those required
by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 10.04, as it
considers to be advisable in order to avoid or diminish any income tax to any
holders of shares of Common Stock resulting from any dividend or distribution of
stock or issuance of rights or warrants to purchase or subscribe for stock or
from any event treated as such for income tax purposes. The Company shall have
the power to resolve any ambiguity or correct any error in this paragraph (10)
and its actions in so doing shall, absent manifest error, be final and
conclusive.
(11) Notwithstanding the foregoing provisions of this Section, no
adjustment of the Conversion Rate shall be required to be made (a) upon the
issuance of shares of Common Stock pursuant to any present or future plan for
the reinvestment of dividends or (b) because of a tender or exchange offer of
the character described in Rule 13e-4(h)(5) under the Exchange Act or any
successor rule thereto.
(12) To the extent permitted by applicable law, the Company from time to
time may increase the Conversion Rate by any amount for any period of time if
the period is at least twenty (20) days, the increase is irrevocable during such
period, and the Board of Directors shall have made a determination that such
increase would be in the best interests of the Company, which determination
shall be conclusive; provided, however,
52
that no such increase shall be taken into account for purposes of determining
whether the Closing Price Per Share of the Common Stock equals or exceeds 105%
of the Conversion Price in connection with an event which would otherwise be a
Change of Control. Whenever the Conversion Rate is increased pursuant to the
preceding sentence, the Company shall give notice of the increase to the Holders
in the manner provided in Section 12.02 at least fifteen (15) days prior to the
date the increased Conversion Rate takes effect, and such notice shall state the
increased Conversion Rate and the period during which it will be in effect.
Section 10.05. Notice of Adjustments of Conversion Rate.
Whenever the Conversion Rate is adjusted as herein provided:
(1) the Company shall compute the adjusted Conversion Rate in accordance
with Section 10.04 and shall prepare a certificate signed by the Chief Financial
Officer of the Company setting forth the adjusted Conversion Rate and showing in
reasonable detail the facts upon which such adjustment is based, and such
certificate shall promptly be filed with the Trustee and with each Conversion
Agent; and
(2) upon each such adjustment, a notice stating that the Conversion Rate
has been adjusted and setting forth the adjusted Conversion Rate shall be
required, and as soon as practicable after it is required, such notice shall be
provided by the Company to all Holders in accordance with Section 12.02.
Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to any such certificate or the information and
calculations contained therein, except to exhibit the same to any Holder of
Notes desiring inspection thereof at its office during normal business hours,
and shall not be deemed to have knowledge of any adjustment in the Conversion
Rate unless and until a Responsible Officer of the Trustee shall have received
such a certificate. Until a Responsible Officer of the Trustee receives such a
certificate, the Trustee and each Conversion Agent may assume without inquiry
that the last Conversion Rate of which the Trustee has knowledge of remains in
effect.
Section 10.06. Notice of Certain Corporate Action.
In case:
(1) the Company shall declare a dividend (or any other distribution) on
its Common Stock payable (i) otherwise than exclusively in cash or (ii)
exclusively in cash in an amount that would require any adjustment pursuant to
Section 10.04; or
53
(2) the Company shall authorize the granting to all or substantially all
of the holders of its Common Stock of rights, options or warrants to subscribe
for or purchase any shares of capital stock of any class or of any other rights;
or
(3) of any reclassification of the Common Stock, or of any
consolidation, merger or share exchange to which the Company is a party and for
which approval of any stockholders of the Company is required, or of the
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Company; or
(4) of the voluntary or involuntary dissolution, liquidation or winding
up of the Company;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Notes pursuant to Section 4.02, and shall cause to
be provided to all Holders in accordance with Section 12.02, at least 20 days
(or 10 days in any case specified in clause (1) or (2) above) prior to the
applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined or
(y) the date on which such reclassification, consolidation, merger, conveyance,
transfer, sale, lease, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, conveyance, transfer, sale, lease, dissolution,
liquidation or winding up. Neither the failure to give such notice or the notice
referred to in the following paragraph nor any defect therein shall affect the
legality or validity of the proceedings described in clauses (1) through (4) of
this Section 10.06. If at the time the Trustee shall not be the conversion
agent, a copy of such notice shall also forthwith be filed by the Company with
the Trustee.
The Company shall cause to be filed at the Corporate Trust Office and
each office or agency maintained for the purpose of conversion of Notes pursuant
to Section 4.02, and shall cause to be provided to all Holders in accordance
with Section 12.02, notice of any tender offer by the Company or any Subsidiary
for all or any portion of the Common Stock at or about the time that such notice
of tender offer is provided to the public generally.
Section 10.07. Company to Reserve Common Stock.
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the
54
conversion of Notes, the full number of shares of Common Stock then issuable
upon the conversion of all outstanding Notes.
Section 10.08. Taxes on Conversions.
Except as provided in the next sentence, the Company will pay any and
all taxes and duties that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Notes pursuant hereto. The Company shall
not, however, be required to pay any tax or duty which may be payable in respect
of any transfer involved in the issue and delivery of shares of Common Stock in
a name other than that of the Holder of the Note or Notes to be converted, and
no such issue or delivery shall be made unless and until the Person requesting
such issue has paid to the Company the amount of any such tax or duty, or has
established to the satisfaction of the Company that such tax or duty has been
paid.
Section 10.09. Covenant as to Common Stock.
The Company agrees that all shares of Common Stock which may be
delivered upon conversion of Notes, upon such delivery, will have been duly
authorized and validly issued and will be fully paid and nonassessable and,
except as provided in Section 10.08, the Company will pay all taxes, liens and
charges with respect to the issue thereof.
Section 10.10. Cancellation of Converted Notes.
All Notes delivered for conversion shall be delivered to the Trustee or
its agent to be canceled by or at the direction of the Trustee, which shall
dispose of the same as provided in Section 2.12.
Section 10.11. Provision in Case of Consolidation, Merger or Sale of Assets.
In case of any consolidation or merger of the Company with or into any
other Person, any merger of another Person with or into the Company (other than
a merger which does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock of the Company) or any
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Company, the Person formed by such consolidation or resulting from such
merger or which acquires such assets, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Note then outstanding shall have the right thereafter, during the period
such Note shall be convertible as specified in Section 10.01, to convert such
Note only into the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, conveyance, sale, transfer or lease
by a holder of the number of shares of Common Stock of the Company into which
such Note might have been converted immediately prior to such consolidation,
merger, conveyance, sale, transfer or lease, assuming such holder of Common
Stock of the Company (i) is not (A) a Person
55
with which the Company consolidated or merged with or into or which merged into
or with the Company or to which such conveyance, sale, transfer or lease was
made, as the case may be (a "Constituent Person"), or (B) an Affiliate of a
Constituent Person and (ii) failed to exercise his rights of election, if any,
as to the kind or amount of securities, cash and other property receivable upon
such consolidation, merger, conveyance, sale, transfer or lease (provided that
if the kind or amount of securities, cash and other property receivable upon
such consolidation, merger, conveyance, sale, transfer, or lease is not the same
for each share of Common Stock of the Company held immediately prior to such
consolidation, merger, conveyance, sale, transfer or lease by others than a
Constituent Person or an Affiliate thereof and in respect of which such rights
of election shall not have been exercised ("Non-electing Share"), then for the
purpose of this Section 10.11 the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, sale, transfer
or lease by the holders of each Non-electing Share shall be deemed to be the
kind and amount so receivable per share by a plurality of the Non-electing
Shares). Such supplemental indenture shall provide for adjustments which, for
events subsequent to the effective date of such supplemental indenture, shall be
as nearly equivalent as may be practicable to the adjustments provided for in
this Article. The above provisions of this Section 10.11 shall similarly apply
to successive consolidations, mergers, conveyances, sales, transfers or leases.
Notice of the execution of such a supplemental indenture shall be given by the
Company to the Holder of each Note as provided in Section 12.02 promptly upon
such execution.
Neither the Trustee nor any Conversion Agent shall be under any
responsibility to determine the correctness of any provisions contained in any
such supplemental indenture relating either to the kind or amount of shares of
stock or other securities or property or cash receivable by Holders of Notes
upon the conversion of their Notes after any such consolidation, merger,
conveyance, transfer, sale or lease or to any such adjustment, but may accept as
conclusive evidence of the correctness of any such provisions, and shall be
protected in relying upon, an Opinion of Counsel with respect thereto, which the
Company shall cause to be furnished to the Trustee.
Section 10.12. Rights Issued in Respect of Common Stock.
Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"):
(i) are deemed to be transferred with such shares of Common Stock,
(ii) are not exercisable, and
(iii) are also issued in respect of future issuances of Common Stock
56
shall not be deemed distributed for purposes of Sections 10.04(2) and 10.04(4)
until the occurrence of the earliest Trigger Event. In addition, in the event of
any distribution of rights or warrants, or any Trigger Event with respect
thereto, that shall have resulted in an adjustment to the Conversion Rate under
Section 10.04(2), (1) in the case of any such rights or warrants which shall all
have been redeemed or repurchased without exercise by any holders thereof, the
Conversion Rate shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder of Common Stock with respect to such rights or
warrants (assuming such holder had retained such rights or warrants), made to
all holders of Common Stock as of the date of such redemption or repurchase, and
(2) in the case of any such rights or warrants all of which shall have expired
without exercise by any holder thereof, the Conversion Price shall be readjusted
as if such issuance had not occurred.
Section 10.13. Responsibility of Trustee for Conversion Provisions.
The Trustee, subject to the provisions of Section 7.01, and any
Conversion Agent shall not at any time be under any duty or responsibility to
any Holder of Notes to determine whether any facts exist which may require any
adjustment of the Conversion Rate, or with respect to the nature or extent of
any such adjustment when made, or with respect to the method employed, herein or
in any supplemental indenture provided to be employed, in making the same, or
whether a supplemental indenture need be entered into. Neither the Trustee,
subject to the provisions of Section 7.01, nor any Conversion Agent shall be
accountable with respect to the validity or value (or the kind or amount) of any
Common Stock, or of any other Notes or property or cash, which may at any time
be issued or delivered upon the conversion of any Note; and it or they do not
make any representation with respect thereto. Neither the Trustee, subject to
the provisions of Section 7.01, nor any Conversion Agent shall be responsible
for any failure of the Company to make or calculate any cash payment or to
issue, transfer or deliver any shares of Common Stock or share certificates or
other Notes or property or cash upon the surrender of any Note for the purpose
of conversion; and the Trustee, subject to the provisions of Section 7.01, and
any Conversion Agent shall not be responsible for any failure of the Company to
comply with any of the covenants of the Company contained in this Article.
57
ARTICLE 11
REPURCHASE OF NOTES AT THE OPTION OF THE HOLDER UPON A
CHANGE OF CONTROL
Section 11.01. Right to Require Repurchase.
If a Change of Control occurs, each Holder shall have the right, at the
Holder's option, but subject to the provisions of Section 11.02, to require the
Company to repurchase, and upon the exercise of such right the Company shall
repurchase, all of such Holder's Notes not theretofore called for redemption, or
any portion of the principal amount thereof that is equal to U.S. $1,000 or any
integral multiple of U.S. $1,000 in excess thereof (provided that no single Note
may be repurchased in part unless the portion of the principal amount of such
Note to be outstanding after such repurchase is equal to U.S. $1,000 or integral
multiples of U.S. $1,000 in excess thereof), pursuant to a Change of Control
Offer. In the Change of Control Offer, the Company shall offer (a "Change of
Control Offer") a payment equal to 100% of the aggregate principal amount of the
Notes to be repurchased plus interest accrued to but excluding the Repurchase
Date (the "Repurchase Price"); provided, however, that installments of interest
on Notes whose Stated Maturity is on or prior to the Repurchase Date shall be
payable to the Holders of such Notes, or one or more Predecessor Notes,
registered as such on the relevant Record Date according to their terms. At the
option of the Company, the Repurchase Price may be paid in cash or, subject to
the fulfillment by the Company of the conditions set forth Section 11.02, by
delivery of shares of Common Stock having a fair market value equal to the
Repurchase Price. Whenever in this Indenture there is a reference, in any
context, to the principal of any Note as of any time, such reference shall be
deemed to include reference to the Repurchase Price payable in respect of such
Note to the extent that such Repurchase Price is, was or would be so payable at
such time, and express mention of the Repurchase Price in any provision of this
Indenture shall not be construed as excluding the Repurchase Price in those
provisions of this Indenture when such express mention is not made.
Section 11.02. Conditions to the Company's Election to Pay the Repurchase Price
in Common Stock.
Except as provided in the last paragraph of this Section 11.02, the
Company may elect to pay the Repurchase Price by delivery of shares of Common
Stock pursuant to Section 11.01 if and only if the following conditions shall
have been satisfied:
(1) The shares of Common Stock deliverable in payment of the Repurchase
Price shall have a fair market value as of the Repurchase Date of not less than
the Repurchase Price. For purposes of Section 11.01 and this Section 11.02, the
fair market value of shares of Common Stock shall be determined by the Company
and shall be equal to 95%
58
of the average of the Closing Prices Per Share of the Common Stock for the five
consecutive Trading Days immediately preceding and including the fifth Trading
Day prior to the Repurchase Date;
(2) The Repurchase Price shall be paid only in cash in the event any
shares of Common Stock to be issued upon repurchase of Notes hereunder (i)
require registration under any federal securities law before such shares may be
freely transferable without being subject to any transfer restrictions under the
Securities Act upon repurchase and if such registration is not completed or does
not become effective prior to the Repurchase Date, and/or (ii) require
registration with or approval of any governmental authority under any state law
or any other federal law before such shares may be validly issued or delivered
upon repurchase and if such registration is not completed or does not become
effective or such approval is not obtained prior to the Repurchase Date (it
being understood that, in the case of this clause (ii) only, if (with respect to
any particular Holder) (x) the Company has been unable so to effect such
registration or obtain such approval after having used its reasonable best
efforts to do so and, as a result, such Holder would be unable to receive shares
of Common Stock or would receive shares of Common Stock that are not free from
restrictions on transfer and (y) the Company pays the full amount of the
Repurchase Price to such Holder in cash as provided in Section 11.01, the
condition set forth in this clause (ii) will be deemed to be satisfied);
(3) Payment of the Repurchase Price may not be made in shares of Common
Stock unless such Common Stock is, or shall have been, approved for quotation on
the Nasdaq National Market or listed on a national securities exchange, in
either case, prior to the Repurchase Date; and
(4) All shares of Common Stock which may be issued upon repurchase of
Notes will be issued out of the Company's authorized but unissued Common Stock
and, upon issuance, will be duly and validly issued and fully paid and
non-assessable and free of any preemptive or similar rights.
If all of the conditions set forth in this Section 11.02 are not
satisfied in accordance with the terms thereof, the Repurchase Price shall be
paid by the Company only in cash. Moreover, and notwithstanding anything in this
Article 11 to the contrary, the Repurchase Price shall not be payable in shares
of Common Stock in the case of a Change of Control under clause (6) of the
definition of "Change of Control".
Section 11.03. Notices; Method of Exercising Repurchase Right, Etc.
(1) Within ten days following any Change of Control, the Company shall
mail a notice to each Holder (with a copy to the Trustee) describing the
transaction or transactions that constitute the Change of Control and stating:
59
(i) the Repurchase Date, which shall not exceed 30 Business Days from
the date such notice is mailed (the "Repurchase Date");
(ii) the date by which the repurchase right must be exercised;
(iii) the Repurchase Price, and whether the Repurchase Price shall be
paid by the Company in cash or by delivery of shares of Common Stock;
(iv)a description of the procedure which a Holder must follow to
exercise a repurchase right, and the place or places where, or procedures
by which, such Notes are to be surrendered for payment of the Repurchase
Price and accrued interest, if any to the Repurchase Date;
(v) that on the Repurchase Date the Repurchase Price, and accrued
interest, if any to the Repurchase Date, will become due and payable upon
each such Note designated by the Holder to be repurchased, and that
interest thereon shall cease to accrue on and after said date;
(vi)the Conversion Rate then in effect, the date on which the right
to convert the principal amount of the Notes to be repurchased will
terminate and the place or places where, or procedures by which, such Notes
may be surrendered for conversion;
(vii) the place or places that the Note with the "Option of Holder to
Purchase" as specified on the reverse of the Note shall be delivered;
(viii) that any Note not tendered shall continue to accrue interest;
(ix)that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Repurchase Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of Notes delivered for purchase, and a statement that such Holder is
withdrawing his election to have the Notes purchased; and
(x) that Holders whose Notes are being purchased only in part shall
be issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof.
No failure of the Company to give the foregoing notices or defect
therein shall limit any Holder's right to exercise a repurchase right or affect
the validity of the proceedings for the repurchase of Notes.
60
If any of the foregoing provisions or other provisions of this Article
11 are inconsistent with applicable law, such law shall govern.
(2) To exercise a repurchase right, a Holder shall deliver to the
Trustee on or before the date specified in the repurchase notice (i) written
notice of the Holder's exercise of such right, which notice shall set forth the
name of the Holder, the principal amount of the Notes to be repurchased (and, if
any Note is to repurchased in part, the serial number thereof, the portion of
the principal amount thereof to be repurchased and the name of the Person in
which the portion thereof to remain outstanding after such repurchase is to be
registered) and a statement that an election to exercise the repurchase right is
being made thereby, and, in the event that the Repurchase Price shall be paid in
shares of Common Stock, the name or names (with addresses) in which the
certificate or certificates for shares of Common Stock shall be issued, and (ii)
the Notes with respect to which the repurchase right is being exercised. The
right of the Holder to convert the Notes with respect to which the repurchase
right is being exercised shall continue until the close of business on the
Business Day prior to the Repurchase Date.
(3) In the event a repurchase right shall be exercised in accordance
with the terms hereof, on the Repurchase Date, the Company shall accept for
payment all Notes or portions thereof properly tendered pursuant to the Change
of Control Offer, deposit with or pay or cause to be paid to the Trustee the
Repurchase Price in cash or shares of Common Stock, as provided above, for
payment by the Trustee to the Holder on the Repurchase Date or, if shares of
Common Stock are to be paid, as promptly after the Repurchase Date as
practicable; provided, however, that installments of interest that mature on or
prior to the Repurchase Date shall be payable in cash to the Holders of such
Notes, or one or more Predecessor Notes, registered as such at the close of
business on the relevant Regular Record Date; and deliver or cause to be
delivered to the Trustee the Notes so accepted together with an Officers'
Certificate stating the aggregate principal amount of Notes or portions thereof
being purchased by the Company.
(4) If any Note (or portion thereof) surrendered for repurchase shall
not be so paid on the Repurchase Date, the principal amount of such Note (or
portion thereof, as the case may be) shall, until paid, bear interest to the
extent permitted by applicable law from the Repurchase Date at the rate
specified therein, and each Note shall remain convertible into Common Stock
until the principal of such Note (or portion thereof, as the case may be) shall
have been paid or duly provided for.
(5) Any Note which is to be repurchased only in part shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and mail (or cause to be transferred by book entry) to the
Holder of such Note without service charge, a new Note
61
or Notes, containing identical terms and conditions, each in an authorized
denomination in aggregate principal amount equal to and in exchange for the
unrepurchased portion of the principal of the Note so surrendered; provided that
each such new Note shall be in principal amount of $1,000 or an integral
multiple thereof.
(6) Any issuance of shares of Common Stock in respect of the Repurchase
Price shall be deemed to have been effected immediately prior to the close of
business on the Repurchase Date and the Person or Persons in whose name or names
any certificate or certificates for shares of Common Stock shall be issuable
upon such repurchase shall be deemed to have become on the Repurchase Date the
holder or holders of record of the shares represented thereby; provided,
however, that any surrender for repurchase on a date when the stock transfer
books of the Company shall be closed shall constitute the Person or Persons in
whose name or names the certificate or certificates for such shares are to be
issued as the record holder or holders thereof for all purposes at the opening
of business on the next succeeding day on which such stock transfer books are
open. No payment or adjustment shall be made for dividends or distributions on
any Common Stock issued upon repurchase of any Note declared prior to the
Repurchase Date.
(7) No fractions of shares shall be issued upon repurchase of Notes. If
more than one Note shall be repurchased from the same Holder and the Repurchase
Price shall be payable in shares of Common Stock, the number of full shares
which shall be issuable upon such repurchase shall be computed on the basis of
the aggregate principal amount of the Notes so repurchased. Instead of any
fractional share of Common Stock which would otherwise be issuable on the
repurchase of any Note or Notes, the Company will deliver to the applicable
Holder its check for the current market value of such fractional share or round
up the number of shares of Common Stock issuable upon conversion to the nearest
whole share). The current market value of a fraction of a share is determined by
multiplying the current market price of a full share by the fraction, and
rounding the result to the nearest cent. For purposes of this Section, the
current market price of a share of Common Stock is the Closing Price Per Share
of the Common Stock on the Trading Day immediately preceding the Repurchase
Date.
(8) Any issuance and delivery of certificates for shares of Common Stock
on repurchase of Notes shall be made without charge to the Holder of Notes being
repurchased for such certificates or for any tax or duty in respect of the
issuance or delivery of such certificates or the Notes represented thereby;
provided, however, that the Company shall not be required to pay any tax or duty
which may be payable in respect of (i) income of the Holder or (ii) any transfer
involved in the issuance or delivery of certificates for shares of Common Stock
in a name other than that of the Holder of the Notes being repurchased, and no
such issuance or delivery shall be made unless and until the Person requesting
such issuance or delivery has paid to the Company the amount of any such tax or
duty or has established, to the satisfaction of the Company, that such tax or
duty has been paid.
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(9) All Notes delivered for repurchase shall be delivered to the Trustee
to be canceled at the direction of the Trustee, which shall dispose of the same
as provided in Section 2.12.
(10) The provisions described above that require the Company to make a
Change of Control Offer following a Change of Control shall be applicable
regardless of whether or not any other provisions in this Indenture are
applicable. Notwithstanding any other provision of this Article 11, the Company
shall not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in this Indenture
applicable to a Change of Control Offer made by the Company and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.
Section 11.04. Consolidation, Merger, Etc.
In the case of any merger, consolidation, conveyance, sale, transfer or
lease of all or substantially all of the assets of the Company to which Section
10.11 applies, in which the Common Stock of the Company is changed or exchanged
as a result into the right to receive shares of stock and other Notes or
property or assets (including cash) which includes shares of Common Stock of the
Company or common stock of another Person that are, or upon issuance will be,
traded on a United States national securities exchange or approved for trading
on an established automated over-the-counter trading market in the United States
and such shares constitute at the time such change or exchange becomes effective
in excess of 50% of the aggregate fair market value of such shares of stock and
other securities, property and assets (including cash) (as determined by the
Company, which determination shall be conclusive and binding), then the Person
formed by such consolidation or resulting from such merger or combination or
which acquires the properties or assets (including cash) of the Company, as the
case may be, shall execute and deliver to the Trustee a supplemental indenture
(which shall comply with the Trust Indenture Act as in force at the date of
execution of such supplemental indenture) modifying the provisions of this
Indenture relating to the right of Holders to cause the Company to repurchase
the Notes following a Change of Control, including without limitation the
applicable provisions of this Article 11 and the definitions of the Common Stock
and Change of Control, as appropriate, and such other related definitions set
forth herein as determined in good faith by the Company (which determination
shall be conclusive and binding), to make such provisions apply in the event of
a subsequent Change of Control to the common stock and the issuer thereof if
different from the Company and Common Stock of the Company (in lieu of the
Company and the Common Stock of the Company).
63
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA s. 318(c), the imposed duties shall control.
Section 12.02. Notices.
Any notice or communication by the Company or the Trustee to the others
is duly given if in writing and delivered in Person or mailed by first class
mail (registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company:
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
Telecopier No.: (314) 965-8793
Attention: Secretary
With a copy to:
Paul, Hastings, Janofsky & Walker LLP Irell & Manella
399 Park Avenue 1800 Avenue of the Stars
31st Floor Suite 900
New York, New York 10022 Los Angeles, California 90067
Telecopier No.: (212) 319-4090 Telecopier No.: (310) 203-7199
Attention: Leigh P. Ryan, Esq. Attention: Meredith Jackson, Esq.
If to the Trustee:
BNY Midwest Trust Company
2 N. LaSalle, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
64
All notices and communications (other than those sent to Holders) shall
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA s. 313(c), to the extent required by the TIA. Failure to
mail a notice or communication to a Holder or any defect in it shall not affect
its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall mail
a copy to the Trustee and each Agent at the same time.
Section 12.03. Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA s. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA s.
312(c).
Section 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 12.05)
stating that, in the opinion of such counsel, all such conditions precedent and
covenants have been satisfied.
65
Section 12.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA s. 314(a)(4)) shall comply with the provisions of TIA s. 314(e)
and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 12.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 12.07. No Personal Liability of Directors, Officers, Employees, Members
and Stockholders.
No director, officer, employee, incorporator, member or stockholder of
the Company, as such, shall have any liability for any obligations of the
Company under the Notes, this Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
Section 12.08. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. EACH OF THE PARTIES HERETO
AGREES TO SUBMIT TO THE
66
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.
Section 12.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 12.10. Successors.
All agreements of the Company in this Indenture and the Notes, as the
case may be, shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successors.
Section 12.11. Severability.
In case any provision in this Indenture or the Notes, as the case may
be, shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 12.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 12.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions.
ARTICLE 13
SATISFACTION AND DISCHARGE
Section 13.01. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange or conversion of Notes
herein expressly provided
67
for), and the Trustee, on demand of and at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered (other than
(i) Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.08 and (ii) Notes for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or
discharged from such trust) have been delivered to the Trustee for
cancellation; or
(B) all such Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited
or caused to be deposited with the Trustee as trust funds in trust for
the purpose an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to the Trustee for
cancellation, for principal (and premium, if any) and interest to the
date of such deposit (in the case of Notes which have become due and
payable) or to the maturity or redemption thereof, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture
pursuant to this Article 13, the obligations of the Company to the Trustee under
Section 7.07, and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 13.02 shall survive such satisfaction and discharge.
68
Section 13.02. Application of Trust Money.
All money deposited with the Trustee pursuant to Section 13.01 shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Paying Agent
as the Trustee may determine, to the Persons entitled thereto, of the principal
(and premium, if any) and interest for whose payment such money has been
deposited with the Trustee.
All moneys deposited with the Trustee pursuant to Section 13.01 (and
held by it or any Paying Agent) for the payment of Notes subsequently converted
shall be returned to the Company upon a written request signed in the name of
the Company by an Officer.
[Signatures on following page]
69
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the day and year first above written.
CHARTER COMMUNICATIONS, INC.
By /s/ Ralph G. Kelly
---------------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and Treasurer
BNY MIDWEST TRUST COMPANY,
as Trustee
By /s/ Mary Callahan
---------------------------------------
Name: Mary Callahan
Title: Assistant Vice President
70
EXHIBIT A
[FACE OF NOTE]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL NOTE:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A
NOMINEE OF THE DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY, THE TRUSTEE AND
ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS NOTE FOR ALL PURPOSES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED TO IN THE
INDENTURE, THIS GLOBAL NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.]
A-1
CUSIP NO.
4.75 % Convertible Senior Notes due 2006
No.
$[----------------]
CHARTER COMMUNICATIONS, INC.
promises to pay to
- ---------------------------------------------------------------------
or registered assigns,
the principal amount of Dollars
---------------------------------------------
($ )(1) on June 1, 2006.
----------------------
Interest Payment Dates: December 1 and June 1
Regular Record Dates: November 15 and May 15
- --------
1 If this Note is a Global Note, then insert: "(which principal amount may
from time to time be increased or decreased to such other principal amount
by adjustments made on the records of the Trustee hereinafter referred to
in accordance with the Indenture)".
A-2
Dated:
CHARTER COMMUNICATIONS, INC.
By_________________________________________
Name:
Title:
By_________________________________________
Name:
Title:
This is one of the Notes referred
to in the within-mentioned Indenture:
BNY MIDWEST TRUST COMPANY,
as Trustee
By:________________________________________
Authorized Signatory
A-3
[BACK OF NOTE]
4.75 % Convertible Senior Notes due 2006
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Charter Communications, Inc., a Delaware corporation (as
further defined in the Indenture, the "Company"), promises to pay interest on
the principal amount of this Note at the rate of 4.75 % per annum from May 30,
2001 until Maturity. The Company will pay interest semi-annually in arrears on
December 1 and June 1 of each year (each an "Interest Payment Date"), or if any
such day is not a Business Day, on the next succeeding Business Day. Interest on
the Notes will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from the date of issuance; provided that if
there is no existing Default in the payment of interest, and if this Note is
authenticated between a Regular Record Date referred to on the face and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date. The first Interest Payment Date shall be
December 1, 2001. The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at a rate that is 1% per annum in
excess of the rate then in effect; and it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the November 15 or May 15 next preceding the
Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.13
of the Indenture with respect to defaulted interest. The Notes will be payable
as to principal, premium, if any, and interest at the office or agency of the
Company maintained for such purpose within or without the City and State of New
York, or, at the option of the Company, payment of interest may be made by check
mailed to the Holders at their addresses set forth in the Note Register, and
provided that payment by wire transfer of immediately available funds will be
required with respect to principal of and interest and premium on all Global
Notes and all other Notes the Holders of which shall have provided wire transfer
instructions to the Company or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
A-4
3. PAYING AGENT, REGISTRAR AND CONVERSION AGENT. Initially, BNY Midwest
Trust Company, the Trustee under the Indenture, will act as Paying Agent,
Registrar and Conversion Agent. The Company may change any Paying Agent,
Registrar or Conversion Agent without notice to any Holder. The Company or any
of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture dated as
of May 30, 2001 (as amended or supplemented from time to time in accordance with
its terms) (the "Indenture") between the Company and the Trustee. The terms of
the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the TIA. The Notes are subject to all such terms, and
Holders are referred to the Indenture and the TIA for a statement of such terms.
To the extent any provision of this Note conflicts with the express provisions
of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of the Company limited to $632,500,000 in
principal amount, except as provided in Section 2.08 of the Indenture.
5. OPTIONAL REDEMPTION. The Company shall not have the option to redeem
the Notes prior to June 4, 2004. Thereafter, the Company shall have the option
to redeem the Notes, in whole or in part, in cash upon not less than 30 nor more
than 60 days' notice, at the Redemption Prices (expressed as percentages of
principal amount) set forth below plus accrued and unpaid interest thereon, if
any, to the applicable Redemption Date, if redeemed during the twelve-month
period beginning on June 4 of the years indicated below:
Year Percentage
---- ----------
2004 101.900 %
2005 100.950 %
6. NOTICE OF REDEMPTION. Notice of redemption will be mailed by first
class mail at least 30 days but not more than 60 days before the Redemption Date
to each Holder whose Notes are to be redeemed at its registered address. Notices
of redemption may not be conditional. No Notes of $1,000 or less may be redeemed
in part. Notes in denominations larger than $1,000 may be redeemed in part but
only in whole multiples of $1,000, unless all of the Notes held by a Holder are
to be redeemed. On and after the Redemption Date, interest ceases to accrue on
Notes or portions thereof called for redemption.
7. MANDATORY REDEMPTION. Except as otherwise provided in Paragraph 8
below, the Company shall not be required to make mandatory redemption payments
with respect to the Notes.
A-5
8. REPURCHASE AT OPTION OF HOLDER. If a Change of Control occurs, the
Company shall make a Change of Control Offer to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to 100% of the principal amount thereof plus interest
accrued to the date of purchase. At the option of the Company, the Repurchase
Price may be paid in cash or, subject to the provisions of the Indenture, by
delivery of shares of Common Stock having a fair market value equal to the
Repurchase Price. For purposes of this paragraph, the fair market value of
shares of Common Stock shall be determined by the Company and shall be equal to
95% of the average of the Closing Prices Per Share for the five consecutive
Trading Days immediately preceding and including the fifth Trading Day prior to
the Repurchase Date. Within 10 days following any Change of Control, the Company
shall mail a notice to each Holder describing the transaction or transactions
that constitute the Change of Control and offering to repurchase Notes on the
Repurchase Date specified in such notice, pursuant to the procedures required by
the Indenture and described in such notice.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a
Regular Record Date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT AND SUPPLEMENT. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with either (i) the
written consent (or as otherwise in accordance with the Applicable Procedures)
of the Holders of at least a majority in aggregate principal amount of the Notes
then outstanding (including, without limitation, consents obtained in connection
with a purchase of, or tender offer or exchange offer for, Notes), or (ii) by
the adoption of a resolution, at a meeting of Holders of the outstanding Notes
at which a quorum is present, by the Holders of at least 66 2/3% in principal
amount of the outstanding Notes represented at such meeting or, if less, by the
Holders of at least a majority in aggregate principal amount of all outstanding
Notes. Without the consent of any Holder of a Note, the Company and the Trustee
may amend or supplement the Indenture or the Notes to cure any ambiguity, defect
or inconsistency, to provide for uncertificated Notes in addition to or in place
of certificated Notes, to provide for the assumption of the Company's
obligations to Holders of Notes in the case
A-6
of a merger or consolidation or sale of all or substantially all of the assets
of the Company, to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, or to comply with the
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the TIA or otherwise as necessary to comply with
applicable law.
12. DEFAULTS AND REMEDIES. Each of the following is an Event of Default:
(i) default for 30 days in the payment when due of interest on the Notes, (ii)
default in payment when due of the principal of or premium, if any, on the
Notes, (iii) failure by the Company to comply with the notice or repurchase
provisions of Article 11 of the Indenture, (iv) failure by the Company for 30
days after written notice thereof has been given to the Company by the Trustee
or to the Company and the Trustee by the Holders of at least 25% of the
aggregate principal amount of the Notes outstanding to comply with any of its
other covenants or agreements in the Indenture, (v) default under any mortgage,
indenture or instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company or any
of its Significant Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Significant Subsidiaries), whether such Indebtedness or
guarantee now exists or is created after the Issue Date, if that default: (a) is
caused by a failure to pay at final stated maturity the principal amount of such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (b) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more, or (vi) certain events of bankruptcy or insolvency with
respect to the Company or any of its Significant Subsidiaries. In the case of an
Event of Default arising from certain events of bankruptcy or insolvency with
respect to the Company, all outstanding Notes will become due and payable
without further action or notice. If any other Event of Default occurs and is
continuing, the Trustee by notice to the Company or the Holders of at least 25%
in principal amount of the then outstanding Notes by notice to the Company and
the Trustee may declare all the Notes to be due and payable immediately. Holders
may not enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in aggregate principal
amount of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Trustee may withhold from Holders of the Notes notice of
any continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. Holders, either (i) through the written
consent (or as otherwise in accordance with the Applicable Procedures) of the
Holders of at least a majority in aggregate principal amount of the then
outstanding Notes (including, without limitation, consents obtained in
connection with a purchase of, or a tender offer or exchange offer
A-7
for, the Notes) by notice to the Trustee or (ii) by the adoption of a
resolution, at a meeting of Holders of the outstanding Notes at which a quorum
is present, by the Holders of at least 66 2/3% in the principal amount of
outstanding Notes represented at such meeting or, if less, by the Holders of at
least a majority in aggregate principal amount of all outstanding Notes by
notice to the Trustee, may on behalf of the Holders of all of the Notes waive
any existing Default or Event of Default and its consequences under the
Indenture, except a continuing Default or Event of Default in the payment of the
principal of, premium, if any, or interest on the Notes or in respect of a
covenant or provision of the Indenture under Article 9 thereof which cannot be
modified or amended without the consent of each outstanding Note affected. The
Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture. Upon becoming aware of any Default or Event of
Default, the Company is required to deliver to the Trustee a statement
specifying such Default or Event of Default.
13. CONVERSION. Subject to and upon compliance with the provisions of
the Indenture, the Holder of this Note is entitled, at his option, at any time
on or before the close of business on the Business Day prior to the date of
Maturity, or in case this Note or a portion hereof is called for redemption or
the Holder hereof has exercised his right to require the Company to repurchase
this Note or such portion hereof, then in respect of this Note until and
including, but (unless the Company defaults in making the payment due upon
redemption or repurchase, as the case may be) not after, the close of business
on the Business Day prior to the Redemption Date or the Repurchase Date, as the
case may be, to convert this Security (or any portion of the principal amount
hereof that is an integral multiple of U.S.$1,000, provided that the unconverted
portion of such principal amount is U.S.$1,000 or any integral multiple of
U.S.$1,000 in excess thereof) into fully paid and nonassessable shares of Common
Stock of the Company at an initial Conversion Rate of 38.0952 shares of Common
Stock for each U.S.$1,000 principal amount of Notes (or at the current adjusted
Conversion Rate if an adjustment has been made as provided in the Indenture) by
surrender of this Note, duly endorsed or assigned to the Company or in blank
and, in case such surrender shall be made during the Record Date Period (except
if this Note or portion thereof has been called for redemption on a Redemption
Date occurring within such Record Date Period and, as a result, the right to
convert would terminate in such period), also accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount equal
to the interest payable on such Interest Payment Date on the principal amount of
this Note then being converted, and also the conversion notice hereon duly
executed, to the Company at the Corporate Trust Office of the Trustee, or at
such other office or agency of the Company, subject to any laws or regulations
applicable thereto and subject to the right of the Company to terminate the
appointment of any Conversion Agent (as defined below) as may be designated by
it pursuant to the Indenture; provided, further, that if this Note or portion
hereof has been called for redemption on a Redemption Date occurring during the
Record Date Period, and is surrendered for conversion during such period, then
the Holder of this Note on the related Regular Record Date will be entitled to
receive the
A-8
interest accruing hereon from the Interest Payment Date next preceding the date
of such conversion to such succeeding Interest Payment Date and the Holder of
this Note who converts this Note or a portion hereof during such period shall
not be required to pay such interest upon surrender of this Note for conversion.
Subject to the provisions of the preceding sentence, no cash payment or
adjustment is to be made on conversion for interest accrued hereon from the
Interest Payment Date next preceding the day of conversion, or for dividends on
the Common Stock issued on conversion hereof. The Company shall thereafter
deliver to the Holder the fixed number of shares of Common Stock (together with
any cash adjustment, as provided in the Indenture) into which this Note is
convertible and such delivery will be deemed to satisfy the Company's obligation
to pay the principal amount of this Note. No fractions of shares or scrip
representing fractions of shares will be issued on conversion, but instead of
any fractional interest (calculated to the nearest 1/100th of a share) the
Company shall pay a cash adjustment as provided in the Indenture (or round up
the number of shares of Common Stock issuable upon conversion to the nearest
whole share).
The Conversion Rate is subject to adjustment as provided in the
Indenture.
In addition, the Indenture provides that in case of certain
consolidations or mergers to which the Company is a party (other than a
consolidation or merger that does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock) or
any conveyance, transfer, sale or lease of all or substantially all of the
property and assets of the Company, the Indenture shall be amended, without the
consent of any Holders of Notes, so that this Note, if then outstanding, will be
convertible thereafter, during the period this Note shall be convertible as
specified above, only into the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, transfer, sale
or lease by a holder of the number of shares of Common Stock of the Company into
which this Note could have been converted immediately prior to such
consolidation, merger, conveyance, transfer, sale or lease (assuming such holder
of Common Stock is not a Constituent Person or an Affiliate of a Constituent
Person, failed to exercise any rights of election and received per share the
kind and amount received per share by a plurality of Non-electing Shares). No
adjustment in the Conversion Rate will be made until such adjustment would
require an increase or decrease of at least one percent of such rate, provided
that any adjustment that would otherwise be made will be carried forward and
taken into account in the computation of any subsequent adjustment.
14. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if it were not the Trustee.
A-9
15. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
16. GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS NOTE AND THE INDENTURE WITHOUT GIVING EFFECT
TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
17. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature (which may be by facsimile) of the Trustee or an
authenticating agent.
18. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TENENT (= tenants
by the entireties), JT TEN (= joint tenants with right of survivorship and not
as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to
Minors Act).
19. CUSIP NUMBERS. No representation is made as to the accuracy of any
CUSIP numbers either as printed on the Notes or as contained in any notice of
redemption and reliance may be placed only on the other identification numbers
placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Charter Communications, Inc.
12444 Powerscourt Drive
Suite 100
St. Louis, Missouri 63131
Attention: Secretary
Telecopier No.: (314) 965-0555
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
---------------------------------
(Insert assignee's legal name)
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint to ---------------------------------------------
transfer this Note on the books of the Company. The agent may substitute another
to act for him.
Date:
---------------------
Your Signature:
---------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:
---------------------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company pursuant
to Article 11 of the Indenture, check below:
|_| Purchase pursuant to Article 11
If you want to elect to have only part of the Note purchased by the
Company pursuant to Article 11 of the Indenture, state the amount you elect to
have purchased:
$
-------------------
Date:
---------------
Your Signature:
---------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:
-------------------------------------------------
Signature Guarantee*:
---------------------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-12
CONVERSION NOTICE
The undersigned Holder of this Note hereby irrevocably exercises the
option to convert this Note, or any portion of the principal amount hereof
(which is U.S.$1,000 or an integral multiple of U.S.$1,000 in excess thereof,
provided that the unconverted portion of such principal amount is U.S. $1,000 or
any integral multiple of U.S. $1,000 in excess thereof) below designated, into
shares of Common Stock in accordance with the terms of the Indenture referred to
in this Note, and directs that such shares, together with a check in payment for
any fractional share and any Notes representing any unconverted principal amount
hereof, be delivered to and be registered in the name of the undersigned unless
a different name has been indicated below. If shares of Common Stock or Notes
are to be registered in the name of a Person other than the undersigned, (a) the
undersigned will pay all transfer taxes payable with respect thereto and (b)
signature(s) must be guaranteed by an Eligible Guarantor Institution with
membership in an approved signature guarantee program pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934. Any amount required to be paid by the
undersigned on account of interest accompanies this Note.
Dated:
------------ ----------------------------------------------------------
Signature(s)
If shares or Notes are to be registered
in the name of a Person other than the
Holder, please print such Person's name
and address:
- --------------------------------
(Name)
- --------------------------------
- --------------------------------
(Address)
- --------------------------------
Social Security or other Identification
Number, if any
- --------------------------------
[Signature Guaranteed]
If only a portion of the Notes is to be converted, please indicate:
1. Principal amount to be converted: U.S. $
----------
2. Principal amount and denomination of Notes
representing unconverted principal amount to be issued:
Amount: U.S. $ Denominations: U.S. $
------------- ------------
A-13
(U.S.$1,000 or any integral multiple of U.S.$1,000 in excess thereof, provided
that the unconverted portion of such principal amount is U.S. $1,000 or any
integral multiple of U.S. $1,000 in excess thereof)
A-14
CHARTER COMMUNICATIONS, INC.
and
BNY MIDWEST TRUST COMPANY,
as Trustee
-----------
INDENTURE
Dated as of May 30, 2001
-----------
4.75% Convertible Senior Notes due 2006
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
310(a)(1).............................................. 7.10
(a)(2)................................................. 7.10
(a)(3)................................................. N.A.
(a)(4)................................................. N.A.
(a)(5)................................................. 7.10
(b).................................................... 7.10
(c).................................................... N.A.
311(a)................................................. 7.11
(b).................................................... 7.11
(c).................................................... N.A.
312(a)................................................. 2.05
(b).................................................... 12.03
(c).................................................... 12.03
313(a)................................................. 7.06
(b)(1)................................................. 12.03
(b)(2)................................................. 7.07; 12.03
(c).................................................... 7.06; 12.02
(d).................................................... 7.06
314(a)................................................. 4.03; 12.02
(b).................................................... 12.02
(c)(1)................................................. 12.04
(c)(2)................................................. 12.04
(c)(3)................................................. N.A.
(d).................................................... N.A.
(e).................................................... 12.05
(f).................................................... N.A.
315(a)................................................. 7.01
(b).................................................... 7.05; 12.02
(c).................................................... 7.01
(d).................................................... 7.01
(e).................................................... 6.11
316(a) (last sentence)................................. 2.10
(a)(1)(A).............................................. 6.05
(a)(1)(B).............................................. 6.04
(a)(2)................................................. N.A.
(b).................................................... 6.07
(c).................................................... 2.13
317(a)(1).............................................. 6.08
(a)(2)................................................. 6.09
(b).................................................... 2.04
i
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
318(a)................................................. 12.01
(b).................................................... N.A.
(c).................................................... 12.01
N.A. means Not Applicable.
* This Cross-Reference Table is not part of the Indenture.
ii
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE...................1
Section 1.01. Definitions..................................................1
Section 1.02. Other Definitions............................................9
Section 1.03. Incorporation by Reference of Trust Indenture Act...........10
Section 1.04. Rules of Construction.......................................10
ARTICLE 2 THE NOTES...................................................11
Section 2.01. Form and Dating.............................................11
Section 2.02. Execution and Authentication................................12
Section 2.03. Registrar; Conversion Agent; and Paying Agent..............12
Section 2.04. Paying Agent to Hold Money in Trust.........................13
Section 2.05. Holder Lists................................................13
Section 2.06. Global Notes; Non-global Notes; Book-entry Provisions.......13
Section 2.07. Registration; Registration of Transfer and Exchange.........15
Section 2.08. Replacement Notes...........................................16
Section 2.09. Outstanding Notes...........................................16
Section 2.10. Treasury Notes..............................................17
Section 2.11. Temporary Notes.............................................17
Section 2.12. Cancellation................................................18
Section 2.13. Defaulted Interest..........................................18
Section 2.14. Computation of Interest.....................................18
Section 2.15. CUSIP Numbers...............................................18
ARTICLE 3 REDEMPTION AND PREPAYMENT...................................19
Section 3.01. Notices to Trustee..........................................19
Section 3.02. Selection of Notes to Be Redeemed...........................19
Section 3.03. Notice of Redemption........................................19
Section 3.04. Effect of Notice of Redemption..............................20
Section 3.05. Deposit of Redemption Price.................................21
Section 3.06. Notes Redeemed in Part......................................21
Section 3.07. Optional Redemption.........................................21
Section 3.08. Conversion Arrangement on Call for Redemption...............22
Section 3.09. Mandatory Redemption........................................23
ARTICLE 4 COVENANTS...................................................23
Section 4.01. Payment of Notes............................................23
Section 4.02. Maintenance of Office or Agency.............................23
Section 4.03. Reports.....................................................24
Section 4.04. Compliance Certificate......................................24
iii
Section 4.05. Taxes.......................................................25
Section 4.06. Stay, Extension and Usury Laws..............................25
Section 4.07. Corporate Existence.........................................25
Section 4.08. Payments for Consent........................................25
Section 4.09. Registration and Listing....................................26
Section 4.10. Waiver of Certain Covenants.................................26
ARTICLE 5 SUCCESSORS..................................................27
Section 5.01. Merger, Consolidation, or Sale of Assets....................27
Section 5.02. Successor Corporation Substituted...........................27
ARTICLE 6 DEFAULTS AND REMEDIES.......................................28
Section 6.01. Events of Default...........................................28
Section 6.02. Acceleration................................................29
Section 6.03. Other Remedies..............................................30
Section 6.04. Waiver of Existing Defaults.................................30
Section 6.05. Control by Majority.........................................30
Section 6.06. Limitation on Suits.........................................31
Section 6.07. Rights of Holders of Notes to Receive Payment and to
Convert.....................................................31
Section 6.08. Collection Suit by Trustee..................................31
Section 6.09. Trustee May File Proofs of Claim............................32
Section 6.10. Priorities..................................................32
Section 6.11. Undertaking for Costs.......................................33
ARTICLE 7 TRUSTEE.....................................................33
Section 7.01. Duties of Trustee...........................................33
Section 7.02. Rights of Trustee...........................................34
Section 7.03. Individual Rights of Trustee................................35
Section 7.04. Trustee's Disclaimer........................................35
Section 7.05. Notice of Defaults..........................................36
Section 7.06. Reports by Trustee to Holders of the Notes..................36
Section 7.07. Compensation and Indemnity..................................36
Section 7.08. Replacement of Trustee......................................37
Section 7.09. Successor Trustee by Merger, etc............................38
Section 7.10. Eligibility; Disqualification...............................38
Section 7.11. Preferential Collection of Claims Against the Company.......39
ARTICLE 8 MEETINGS OF HOLDERS OF NOTES................................39
Section 8.01. Purposes for Which Meetings May Be Called...................39
Section 8.02. Call, Notice and Place of Meetings..........................39
Section 8.03. Persons Entitled to Vote at Meetings........................40
Section 8.04. Quorum; Action..............................................40
iv
Section 8.05. Determination of Voting Rights; Conduct and Adjournment of
Meetings....................................................41
Section 8.06. Counting Votes and Recording Action of Meetings.............41
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER............................42
Section 9.01. Without Consent of Holders of Notes.........................42
Section 9.02. With Consent of Holders of Notes............................43
Section 9.03. Compliance with Trust Indenture Act.........................44
Section 9.04. Revocation and Effect of Consents...........................45
Section 9.05. Notation on or Exchange of Notes............................45
Section 9.06. Trustee to Sign Amendments, etc.............................45
ARTICLE 10 CONVERSION OF NOTES.........................................45
Section 10.01.Conversion Privilege and Conversion Rate....................45
Section 10.02.Exercise of Conversion Privilege............................46
Section 10.03.Fractions of Shares.........................................47
Section 10.04.Adjustment of Conversion Rate...............................48
Section 10.05.Notice of Adjustments of Conversion Rate....................53
Section 10.06.Notice of Certain Corporate Action..........................53
Section 10.07.Company to Reserve Common Stock.............................54
Section 10.08.Taxes on Conversions........................................55
Section 10.09.Covenant as to Common Stock.................................55
Section 10.10.Cancellation of Converted Notes.............................55
Section 10.11.Provision in Case of Consolidation, Merger or Sale of
Assets......................................................55
Section 10.12.Rights Issued in Respect of Common Stock....................56
Section 10.13.Responsibility of Trustee for Conversion Provisions.........57
ARTICLE 11 REPURCHASE OF NOTES AT THE OPTION OF THE HOLDER UPON
A CHANGE OF CONTROL.........................................58
Section 11.01.Right to Require Repurchase.................................58
Section 11.02.Conditions to the Company's Election to Pay the Repurchase
Price in Common Stock.......................................58
Section 11.03.Notices; Method of Exercising Repurchase Right, Etc.........59
Section 11.04.Consolidation, Merger, Etc..................................63
ARTICLE 12 MISCELLANEOUS...............................................64
Section 12.01.Trust Indenture Act Controls................................64
Section 12.02.Notices.....................................................64
Section 12.03.Communication by Holders of Notes with Other Holders of
Notes.......................................................65
Section 12.04.Certificate and Opinion as to Conditions Precedent..........65
Section 12.05.Statements Required in Certificate or Opinion...............66
Section 12.06.Rules by Trustee and Agents.................................66
v
Section 12.07.No Personal Liability of Directors, Officers, Employees,
Members and Stockholders....................................66
Section 12.08.Governing Law...............................................66
Section 12.09.No Adverse Interpretation of Other Agreements...............67
Section 12.10.Successors..................................................67
Section 12.11.Severability................................................67
Section 12.12.Counterpart Originals.......................................67
Section 12.13.Table of Contents, Headings, etc............................67
ARTICLE 13 SATISFACTION AND DISCHARGE..................................67
Section 13.01.Satisfaction and Discharge of Indenture.....................67
Section 13.02.Application of Trust Money..................................69
EXHIBIT A....................................................................A-1
vi
Charter Communications, Inc.
Class A Common Stock, Par Value $.001 Per Share
Underwriting Agreement
----------------------
May 23, 2001
Morgan Stanley & Co. Incorporated,
Goldman, Sachs & Co.,
Banc of America Securities LLC,
Bear, Stearns & Co. Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Salomon Smith Barney Inc.,
J.P. Morgan Securities Inc.
Credit Lyonnais Securities (USA) Inc.,
Fleet Securities, Inc.,
BMO Nesbitt Burns,
Dresdner Kleinwort Wasserstein Securities LLC,
As representatives of the several Underwriters
named in Schedule I hereto (the "Representatives"),
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
Charter Communications, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") an aggregate
of 52,389,000 shares (the "Firm Shares") and, at the election of the
Underwriters, up to 7,858,350 additional shares (the "Optional Shares") of Class
A Common Stock, par value $.001 per share ("Stock"), of the Company (the Firm
Shares and the Optional Shares that the Underwriters elect to purchase pursuant
to Section 2 hereof being collectively called the "Shares").
It is understood and agreed that Morgan Stanley & Co. Incorporated and
Goldman, Sachs & Co. are joint book-runners and joint lead managers for the
offering of the Shares and any determinations or other actions to be made under
this Agreement by
you or the Representatives shall require the concurrence of both Morgan Stanley
& Co. Incorporated and Goldman, Sachs & Co.
1. The Company and Charter Communications Holding Company, LLC, a
Delaware limited liability company ("Holding"), jointly and severally, represent
and warrant to, and agree with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-56850) and
pre-effective amendment no. 1 thereto (together, the "Initial Registration
Statement") in respect of the Shares and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the
Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act"), has been filed with the Commission;
the Initial Registration Statement and any post-effective amendment thereto
filed with the Commission on or before the date of this Agreement, each in
the form heretofore delivered to you, and, excluding exhibits thereto but
including all documents incorporated by reference in the prospectus
contained therein, delivered to you for each of the other Underwriters,
have been declared effective by the Commission in such form; no other
document with respect to the Initial Registration Statement or documents
incorporated by reference therein has heretofore been filed with the
Commission (other than prospectuses filed pursuant to Rule 424(b) of the
rules and regulations of the Commission under the Act, each in the form
heretofore delivered to you); and no stop order suspending the
effectiveness of the Initial Registration Statement or any post-effective
amendment thereto has been issued and no proceeding for that purpose has
been initiated or threatened by the Commission (any preliminary prospectus
included in the Initial Registration Statement, filed with the Commission
pursuant to Rule 424(a) of the rules and regulations of the Commission
under the Act or that omitted information to be included upon pricing in a
form of prospectus filed with the Commission pursuant to Rule 424(b) of the
rules and regulations of the Commission under the Act, is hereinafter
called a "Preliminary Prospectus"; the various parts of the Initial
Registration Statement, including all exhibits thereto and the documents
incorporated by reference in the prospectus contained in the Initial
Registration Statement at the time such part of the Initial Registration
Statement became effective, each as amended at the time such part of the
Initial Registration Statement became effective and as amended by any
post-effective amendment thereto at the time such post-effective amendment
became effective, are hereinafter collectively called the "Registration
Statement"; the final prospectus supplement and the final prospectus
relating to the Shares, in the form first filed with the Commission
pursuant to Rule 424(b) under the Act, are hereinafter collectively called
the "Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
Act, as of the date of such Preliminary Prospectus or Prospectus, as the
case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus
or Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference in
such Preliminary Prospectus or
2
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any annual
report of the Company filed pursuant to Section 13(a) or 15(d) of the
Exchange Act after the effective date of the Initial Registration Statement
that is incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed to
refer to the Prospectus as amended or supplemented relating to the Shares
in the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof, including any
documents incorporated by reference therein as of the date of such filing).
(b) No order preventing or suspending the use of any Preliminary
Prospectus or Prospectus has been issued by the Commission, and each
Preliminary Prospectus and Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the Act and the
rules and regulations of the Commission thereunder and did not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Morgan Stanley & Co. Incorporated and Goldman, Sachs &
Co. expressly for use therein;
(c) The documents incorporated by reference in any Preliminary
Prospectus and Prospectus, when they became effective or were filed with
the Commission, as the case may be, conformed in all material respects to
the requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder, and, when such
documents became effective or were filed with the Commission, as the case
may be, none of such documents contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(d) As of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable filing date as
to the Prospectus and any amendment or supplement thereto, the Registration
Statement and the Prospectus conform, and any further amendments or
supplements to the Registration Statement or the Prospectus will conform,
in all material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder and do not and will not, as of the
applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the Prospectus
and any amendment or supplement thereto, contain an untrue statement of a
material fact or
3
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through Morgan Stanley & Co.
Incorporated and Goldman, Sachs & Co. expressly for use therein;
(e) Neither the Company nor any of its subsidiaries has sustained since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
there has not been any change in the capital stock, limited liability
company interests or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, members' or stockholders' equity, or
results of operations of the Company and its subsidiaries, otherwise than
as set forth or contemplated in the Prospectus;
(f) Each of the Company and its subsidiaries has good and marketable
title in fee simple to all real property and good and valid title to all
personal property owned by it reflected as owned in the financial
statements or elsewhere in the Prospectus, in each case free and clear of
all liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such property
and do not interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; and any real property and
buildings held under lease by the Company and its subsidiaries are held by
them under valid, subsisting and enforceable leases with such exceptions as
are not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its subsidiaries;
(g) The Company has been duly formed and is validly existing as a
corporation in good standing under the laws of the State of Delaware;
Holding has been duly formed and is validly existing as a limited liability
company in good standing under the laws of the State of Delaware; each of
the Company and Holding has power and authority (corporate and other) to
own its properties and conduct its business as described in the Prospectus
and to execute, deliver and perform its obligations under this Agreement,
and has been duly qualified as a foreign corporation or limited liability
company, as the case may be, for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such
qualification, and is not subject to liability or disability by reason of
the failure to be so qualified in any such jurisdiction, except such as
would not, individually and in the aggregate, have a material adverse
effect on the current or future financial position, stockholders' or
members' equity or results of operations of the Company and its
4
subsidiaries taken as a whole (a "Material Adverse Effect"); each
"significant subsidiary" (as such term is defined in Rule 1-02 of
Regulation S-X) of the Company (each, a "Significant Subsidiary") has been
duly incorporated or formed, as the case may be, and is validly existing as
a corporation or limited liability company, as the case may be, in good
standing under the laws of its jurisdiction of incorporation or formation;
(h) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and
non-assessable, and conform to the descriptions thereof contained in the
Prospectus; the Company's stockholders have no preemptive rights with
respect to the Stock; Holding has an authorized capitalization as set forth
in the Prospectus, and all of the issued and outstanding Membership Units
have been duly and validly authorized and issued, are fully paid and
non-assessable, are owned directly by the Company, Charter Investment,
Inc., Vulcan Cable III Inc. and by those other persons and entities as
described in the Prospectus, and, in the case of the Company, are owned
free and clear of all liens, encumbrances, equities or claims, and conform
to the description thereof contained in the Prospectus; and all of the
outstanding capital stock or limited liability company interests, as the
case may be, of each Significant Subsidiary of the Company have been duly
and validly authorized and issued, are fully paid and non-assessable and
(except as otherwise set forth in the Prospectus) are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims;
(i) The Shares to be issued and sold by the Company to the Underwriters
hereunder have been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and non-assessable and will conform to the
description of the Stock contained in the Prospectus;
(j) The issue and sale of the Shares hereunder and the compliance by
the Company and Holding, as the case may be, with all of the provisions of
this Agreement and the consummation of the transactions herein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement, lease, license, franchise
agreement, permit or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action result
in any violation of any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Company,
any of its subsidiaries or any of their respective properties, including,
without limitation, the Communications Act of 1934, as amended, the Cable
Communications Policy Act of 1984, as amended, the Cable Television
Consumer Protection and Competition Act of 1992, as amended, and the
Telecommunications Act of 1996 (collectively, the "Cable Acts") or any
order, rule or regulation of the Federal Communications Commission (the
"FCC"), except where
5
such conflict, breach, violation or default would not, individually and in
the aggregate, have a Material Adverse Effect and would not have the effect
of preventing the Company or Holding from performing any of their
respective obligations under this Agreement; nor will such action result in
any violation of the restated certificate of incorporation or bylaws of the
Company or the certificate of formation or amended and restated limited
liability company agreement of Holding; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required, including, without
limitation, under the Cable Acts or any order, rule or regulation of the
FCC, for the issue and sale of the Shares or the consummation by the
Company or Holding, as the case may be, of the transactions contemplated by
this Agreement, except such consents, approvals, authorizations,
registrations or qualifications as have been made or except as may be
required under state or foreign securities or Blue Sky laws in connection
with the purchase and distribution of the Shares by the Underwriters and
except such as may be required by the National Association of Securities
Dealers, Inc. ("NASD");
(k) Neither the Company nor any of its subsidiaries is (i) in violation
of its certificate of incorporation, bylaws, certificate of formation,
limited liability company agreement or other organizational document, as
the case may be, (ii) in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease, license, permit or other
agreement or instrument to which it is a party or by which it or any of its
properties may be bound or (iii) in violation of the terms of any franchise
agreement, or any law, statute, rule or regulation or any judgment, decree
or order, in any such case, of any court or governmental or regulatory
agency or other body having jurisdiction over the Company or any of its
subsidiaries or any of their properties or assets, including, without
limitation, the Cable Acts or any order, rule or regulation of the FCC,
except, in the case of clauses (ii) and (iii), such as would not,
individually and in the aggregate, have a Material Adverse Effect;
(l) The provisions of the Company's restated certificate of
incorporation and bylaws, including, without limitation, the provisions
thereof relating to the Stock and the Company's Class B Common Stock, par
value .001 per share (the "Class B Stock") (A) are lawful and permitted
under the Delaware General Corporation Law, do not violate any Delaware
statute or rule or regulation of any Delaware governmental agency or body
having jurisdiction over the Company or Holding and, subject to principles
of equity, a Delaware court properly presented with the matter would so
find and (B) do not violate any order of any Delaware court having
jurisdiction over the Company or Holding. Holding's certificate of
formation and amended and restated limited liability company agreement do
not violate the Delaware Limited Liability Company Act, Holding's amended
and restated limited liability company agreement is enforceable against the
parties thereto in accordance with its terms, and Holding's certificate of
formation and amended and restated limited liability company agreement do
not violate (i) any Delaware statute, (ii) any rule or regulation of any
Delaware governmental agency or body having jurisdiction
6
over the Company or Holding or (iii) any order of any Delaware court having
jurisdiction over the Company or Holding;
(m) The statements set forth in the Prospectus under the captions
"Risks Factors -- Regulatory and Legislative Matters," "Business -- Pending
AT&T Transactions," "Regulation and Legislation," "Management," "Certain
Relationships and Related Transactions," "Description of Certain
Indebtedness," "Description of Capital Stock and Membership Units," "Shares
Eligible For Future Sale" and "Certain United States Tax Considerations for
Non-United States Holders of Class A Common Stock," insofar as they purport
to describe the provisions of the laws, documents and arrangements referred
to therein, are accurate in all material respects;
(n) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings (including, without limitation, by the FCC or any
franchising authority) pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject which, if determined adversely to the
Company or any of its subsidiaries, would, individually or in the
aggregate, have a Material Adverse Effect; and, to the best knowledge of
the Company and Holding and except as disclosed in the Prospectus, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(o) Each of the Company and its subsidiaries carries insurance
(including self-insurance) in such amounts and covering such risks as in
the reasonable determination of the Company and Holding is adequate for the
conduct of its business and the value of its properties;
(p) Except as set forth in the Prospectus, there is no strike, labor
dispute, slowdown or work stoppage with the employees of any of the Company
or its subsidiaries which is pending or, to the best knowledge of the
Company and Holding, threatened which would, individually or in the
aggregate, have a Material Adverse Effect;
(q) Neither the Company nor Holding is and, after giving effect to the
offering and sale of the Shares, neither of them will be an "investment
company" or an entity "controlled" by an "investment company," as such
terms are defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(r) The audited consolidated financial statements (including the notes
thereto) included or incorporated by reference in the Prospectus present
fairly in all material respects the respective consolidated financial
positions, results of operations and cash flows of the entities to which
they relate at the dates and for the periods to which they relate and have
been prepared in accordance with U.S. generally accepted accounting
principles ("GAAP") applied on a consistent basis; the supporting schedules
included or incorporated by reference in the Registration Statement present
fairly in accordance with GAAP the information required to be stated
therein; and the summary and selected financial data in the Prospectus
present fairly in all material
7
respects the information shown therein and have been prepared and compiled
on a basis consistent with the audited financial statements included
therein;
(s) The pro forma financial statements (including the notes thereto)
and the other pro forma financial information included or incorporated by
reference in the Prospectus (i) comply as to form in all material respects
with the applicable requirements of Regulation S-X for Form S-3 promulgated
under the Exchange Act, and (ii) have been properly computed on the bases
described therein; the assumptions used in the preparation of the pro forma
financial data and other pro forma financial information included or
incorporated by reference in the Prospectus are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
or circumstances referred to therein;
(t) Each of the firms who have certified financial statements included
or incorporated by reference in the Prospectus are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder, based upon representations by such firms to the
Company;
(u) The Company and its subsidiaries own or possess, or can acquire on
reasonable terms, adequate licenses, trademarks, service marks, trade names
and copyrights (collectively, "Intellectual Property") necessary to conduct
the business now or proposed to be operated by each of them as described in
the Prospectus, except where the failure to own, possess or have the
ability to acquire any Intellectual Property would not, individually and in
the aggregate, have a Material Adverse Effect; and neither the Company nor
any of its subsidiaries has received any notice of infringement of or
conflict with (and none actually knows of any such infringement of or
conflict with) asserted rights of others with respect to any Intellectual
Property which, if any such assertion of infringement or conflict were
sustained would, individually or in the aggregate, have a Material Adverse
Effect;
(v) Except as described in the Prospectus, the Company and its
subsidiaries have obtained all consents, approvals, orders, certificates,
licenses, permits, franchises and other authorizations of and from, and
have made all declarations and filings with, all governmental and
regulatory authorities (including, without limitation, the FCC), all
self-regulatory organizations and all courts and other tribunals legally
necessary to own, lease, license and use their respective properties and
assets and to conduct their respective businesses in the manner described
in the Prospectus, except to the extent that the failure to so obtain or
file would not, individually and in the aggregate, have a Material Adverse
Effect;
(w) Each of the franchises held by the Company and its subsidiaries
that is material to the Company and its subsidiaries, taken as a whole, is
in full force and effect, with no material restrictions or qualifications
other than those with which the Company and/or its subsidiaries are in
compliance in all material respects; and to the best knowledge of the
Company, no event has occurred which permits, or with notice or lapse of
time or both would permit, the revocation or non-renewal of any such
franchise, assuming the filing of timely renewal applications and the
timely payment
8
of all applicable filing and regulatory fees to the applicable franchising
authority, or which might result, individually or in the aggregate, in any
other material impairment of the rights of the Company and its subsidiaries
in such franchises. Except as described in the Prospectus, the Company has
no reason to believe that any such franchise will not be renewed in the
ordinary course;
(x) The Company and its subsidiaries (i) are in compliance with any and
all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance with Environmental Laws, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and
conditions of such permits, licenses or approvals would not, individually
and in the aggregate, have a Material Adverse Effect;
(y) The Company and its subsidiaries have filed all necessary federal,
state and foreign income and franchise tax returns required to be filed as
of the date hereof, except where the failure to so file such returns would
not, individually and in the aggregate, have a Material Adverse Effect, and
have paid all taxes shown as due thereon; and there is no tax deficiency
that has been asserted against the Company or any of its subsidiaries that
could reasonably be expected to result, individually or in the aggregate,
in a Material Adverse Effect;
(z) Except as described in the Prospectus, there are no contracts,
agreements or understandings between the Company, Holding or any of their
affiliates and any person granting such person the right to require the
Company or Holding to file a registration statement under the Act with
respect to any securities of the Company or Holding;
(aa) Except as described in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, and no
commitments, plans or arrangements to issue, any securities of the Company
or Holding or any security convertible into or exchangeable for securities
of the Company or Holding;
(bb) There are no contracts, other documents or other agreements
required to be described in the Registration Statement or to be filed as
exhibits to the Registration Statement by the Act or by the rules and
regulations thereunder which have not been described or filed or
incorporated by reference therein as required; the contracts so described
in the Prospectus are in full force and effect on the date hereof; and
neither the Company nor any of its subsidiaries and, to the best of the
Company's knowledge, any other party is in breach of or default under any
of such contracts, except for those breaches or defaults that would not,
individually and in the aggregate, result in a Material Adverse Effect;
9
(cc) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences; and
(dd) Prior to the date hereof, none of the Company, any of its
subsidiaries or, to the best of the Company's knowledge, any of its other
affiliates has taken any action which is designed to or which has
constituted or which might have been expected to cause or result in
stabilization or manipulation of the price of any security of the Company
or any of its subsidiaries in connection with the offering of the Shares.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price per share of $20.265, the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto and (b) in the event
and to the extent that the Underwriters shall exercise the election to purchase
Optional Shares as provided below, the Company agrees to issue and sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the same purchase price per share set
forth in clause (a) of this Section 2, that portion of the number of Optional
Shares as to which such election shall have been exercised (to be adjusted by
you so as to eliminate fractional shares) determined by multiplying such number
of Optional Shares by a fraction, the numerator of which is the maximum number
of Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 7,858,350 Optional Shares, at the purchase price per share
set forth in clause (a) of the first paragraph of this Section 2, for the sole
purpose of covering sales of securities in excess of the number of the Firm
Shares. Any such election to purchase Optional Shares may be exercised only by
written notice from both of Morgan Stanley & Co. Incorporated and Goldman, Sachs
& Co. to the Company, given within a period of 30 calendar days after the date
of this Agreement, setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless you and the Company otherwise agree in
writing, earlier than two or later than ten business days after the date of such
notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
10
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Goldman, Sachs & Co. may request upon at least forty-eight hours' prior
notice to the Company, shall be delivered by or on behalf of the Company to
Goldman, Sachs & Co., through the facilities of The Depository Trust Company
("DTC"), for the account of such Underwriter, against payment by or on behalf of
such Underwriter of the purchase price therefor by wire transfer of Federal
(same-day) funds to the account specified by the Company to Goldman, Sachs & Co.
at least forty-eight hours in advance. The Company will cause the certificates
representing the Shares to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery (as defined below) with respect
thereto at the office of DTC or its designated custodian (the "Designated
Office"). The time and date of such delivery and payment shall be, with respect
to the Firm Shares, 9:30 a.m., New York City time, on May 30, 2001 or such other
time and date as Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co. and
the Company may agree upon in writing, and, with respect to the Optional Shares,
9:30 a.m., New York City time, on the date specified by Morgan Stanley & Co.
Incorporated and Goldman, Sachs & Co. in the written notice given by Morgan
Stanley & Co. Incorporated and Goldman, Sachs & Co. of the Underwriters'
election to purchase such Optional Shares, or such other time and date as Morgan
Stanley & Co. Incorporated and Goldman, Sachs & Co. and the Company may agree
upon in writing. Such time and date for delivery of the Firm Shares is herein
called the "First Time of Delivery", such time and date for delivery of the
Optional Shares, if not the First Time of Delivery, is herein called the "Second
Time of Delivery", and each such time and date for delivery is herein called a
"Time of Delivery."
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the cross
receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(m) hereof, will be delivered at such time and
date at the offices of Paul, Hastings, Janofsky & Walker LLP, 399 Park Avenue,
New York, New York 10022 or such other location as the parties mutually agree
(the "Closing Location"), and the Shares will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at 2:00 p.m., New York City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement; to make no further amendment or
any supplement to the Registration Statement or Prospectus prior to the
last Time of Delivery which shall be disapproved
11
by you promptly after reasonable notice thereof; to advise you, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and
to furnish you with copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act subsequent to the date of the Prospectus and for so
long as the delivery of a prospectus is required in connection with the
offering or sale of the Shares, to advise you, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any Prospectus, of the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any
order preventing or suspending the use of any Prospectus or suspending any
such qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with
such laws so as to permit the continuance of sales and dealings therein in
such jurisdictions for as long as may be necessary to complete the
distribution of the Shares, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction;
(c) On the New York Business Day next succeeding the date of this
Agreement or as soon as practicable thereafter and from time to time, to
furnish the Underwriters with written and electronic copies of the
Prospectus in New York City in such quantities as you may reasonably
request, and, if the delivery of a prospectus is required at any time prior
to the expiration of nine months after the time of issue of the Prospectus
in connection with the offering or sale of the Shares and if at such time
any event shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the Act
or the Exchange Act, to notify you and upon your request to file such
document and to prepare and furnish without charge to each Underwriter and
to any dealer in securities as many written and electronic copies as you
may from time to time reasonably request of an amended Prospectus or a
supplement to the Prospectus which will correct such statement or omission
or effect such compliance, and in case any Underwriter is required to
deliver a prospectus in connection with sales of any of the Shares at any
time nine months or more after the time of issue of the Prospectus, upon
your request but at the expense of such Underwriter, to prepare and deliver
to such
12
Underwriter as many written and electronic copies as you may request of an
amended or supplemented Prospectus complying with Section 10(a)(3) of the
Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing
until the date 90 days after the date of this Agreement, not to offer,
sell, contract to sell or otherwise dispose of, except as provided
hereunder, any securities of the Company that are substantially similar to
the Shares, including but not limited to any securities that are
convertible into or exchangeable for, or that represent the right to
receive, Stock or any such substantially similar securities (other than (i)
pursuant to employee option plans existing on the date of this Agreement
(or subsequently adopted by the Company's board of directors), (ii) upon
the conversion or exchange of convertible or exchangeable securities
outstanding as of the date of this Agreement or (iii) shares of Stock
issued by the Company as consideration for acquisitions of businesses
occurring after the date of this Agreement as long as the recipients of
such shares execute and deliver prior to the closing of any such
acquisition a lock-up agreement substantially to the effect of the lock-up
agreements being delivered pursuant to Section 7(k) hereof), without the
prior written consent of Morgan Stanley & Co. Incorporated and Goldman,
Sachs & Co.; provided that this paragraph (e) shall not restrict the
Company's participation (other than as a seller of securities) in
connection with sales of securities under registration statements that (x)
are effective on the date of this Agreement or (y) the Company is required
to file pursuant to registration rights agreements (other than with any
person or entity named in Schedule II hereto) outstanding on the date of
this Agreement;
(f) Not to be or become, at any time prior to the expiration of two
years after the Time of Delivery, an open-end investment company, unit
investment trust, closed-end investment company or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act;
(g) To furnish to its stockholders as soon as practicable after the end
of each fiscal year an annual report (including a balance sheet and
statements of income, stockholders' and members' equity and cash flows of
the Company and its consolidated subsidiaries certified by independent
public accountants) and, as soon as practicable after the end of each of
the first three quarters of each fiscal year (beginning with the fiscal
quarter ending after the effective date of the Registration Statement), to
make available to its stockholders consolidated summary financial
information of the Company and its subsidiaries for such quarter in
reasonable detail;
(h) During a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial
13
or other) furnished to stockholders of the Company; and to deliver to you
as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is
listed;
(i) To use the net proceeds received from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under
the caption "Use of Proceeds"; and
(j) To use its best efforts to have the Shares approved for quotation
on the Nasdaq National Market ("Nasdaq").
6. The Company and Holding, jointly and severally, covenant and agree
with the several Underwriters that the Company and Holding, jointly and
severally, will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's and Holding's counsel and
accountants in connection with the registration of the Shares under the Act and
all other expenses in connection with the preparation, printing and filing of
the Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the Blue Sky Memorandum,
closing documents (including compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Shares; (iii)
all expenses in connection with the qualification of the Shares for offering and
sale under state securities laws as provided in Section 5(b) hereof, including
the fees and disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with listing the Shares on Nasdaq; (v) the filing fees
incident to, and the fees and disbursements of counsel for the Underwriters in
connection with, any required review by the NASD of the terms of the sale of the
Shares; (vi) the cost of preparing stock certificates; (vii) the cost and
charges of any transfer agent or registrar; and (viii) all other costs and
expenses incident to the performance of the Company's and Holding's obligations
hereunder which are not otherwise specifically provided for in this Section. It
is understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, stock transfer taxes on resale of any of
the Shares by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and Holding herein are, at and as of such Time of Delivery, true and
correct, the condition that the Company and Holding shall have performed all of
their obligations hereunder theretofore to be performed, and the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules
14
and regulations under the Act and in accordance with Section 5(a) hereof;
no stop order suspending the effectiveness of the Registration Statement or
any part thereof shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; and all requests
for additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Debevoise & Plimpton, counsel for the Underwriters, shall have
furnished to you such opinion, dated such Time of Delivery, with respect to
the matters covered in paragraphs (i), (ii), (v), (viii) (as to the Stock
and the Membership Units), (x) and the last paragraph of subsection (c)
below as well as such other related matters as you may reasonably request;
and such counsel shall have received such papers and information as they
may reasonably request to enable them to pass upon such matters;
(c) Paul, Hastings, Janofsky & Walker LLP, counsel for the Company and
Holding, shall have furnished to you their written opinion, dated such Time
of Delivery, in form and substance satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware; Holding has been duly formed and is validly existing as a
limited liability company in good standing under the laws of the State
of Delaware; each of the Company and Holding has the power and
authority (corporate or other) to own or lease its properties and
conduct its business as described in the Prospectus and to execute,
deliver and perform its obligations under this Agreement;
(ii) The Company has an authorized capitalization as set forth in
the Prospectus; the Shares, when issued and delivered against payment
therefor as contemplated by this Agreement, will be duly and validly
authorized and issued, fully paid and non-assessable; and the Stock
conforms in all material respects to the description thereof contained
in the Prospectus under the caption "Description of Capital Stock and
Membership Units";
(iii) Holding has an authorized capitalization as set forth in
the Prospectus; all of the Membership Units to be issued and delivered
as contemplated by the "Use of Proceeds" section of the Prospectus,
when issued and delivered against payment therefor as contemplated by
the Prospectus, will be duly and validly authorized and issued; fully
paid and non-assessable; and the Membership Units conform in all
material respects to the description thereof contained in the
Prospectus under the caption "Description of Capital Stock and
Membership Units";
(iv) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the Company or any of its
subsidiaries is the subject which are likely to have, individually or
in the aggregate, a Material Adverse Effect; and, to the best of
15
such counsel's knowledge and other than as set forth in the Prospectus,
no such proceedings are overtly threatened by governmental authorities
or by others;
(v) This Agreement has been duly authorized, executed and
delivered by each of the Company and Holding;
(vi) The issue and sale of the Shares being delivered at such
Time of Delivery by the Company and the compliance by the Company and
Holding with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not, to the
best of such counsel's knowledge, result in a material breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement, lease,
license, permit or other agreement or instruments specifically
identified to such counsel by the Company as material to the Company on
a schedule, nor will any such action result in any violation of the
provisions of the restated certificate of incorporation or by-laws of
the Company or the certificate of formation or amended and restated
limited liability company agreement of Holding, or any Federal or New
York State statute or any order, rule or regulation of any Federal or
New York State court or governmental agency or body having jurisdiction
over the Company or its subsidiaries or any of their properties;
(vii) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
referred to in paragraph (vi) is required for the issue and sale of the
Shares or the consummation by the Company and Holding of the
transactions contemplated by this Agreement, except the registration
under the Act of the Shares and such consents, approvals,
authorizations, registrations or qualifications as have been obtained
or may be required under state or foreign securities or Blue Sky laws
in connection with the purchase and distribution of the Shares by the
Underwriters and except such as may be requested by the NASD;
(viii) The statements set forth in the Prospectus under the
captions "Description of Certain Indebtedness," "Description of Capital
Stock and Membership Units," "Shares Eligible For Future Sale,"
"Certain United States Tax Considerations for Non-United States Holders
of Class A Common Stock," and "Indemnification of Directors and
Officers," insofar as they purport to describe the provisions of the
laws, documents and arrangements referred to therein, fairly summarize
such laws and documents in all material respects;
(ix) Neither the Company nor Holding is an "investment company"
or an entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act;
(x) The Registration Statement and the Prospectus and any further
amendments and supplements thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related notes
and schedules therein, as to which such counsel need express no
opinion) comply as to form in
16
all material respects with the requirements of the Act and the rules
and regulations thereunder, although such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus,
except for those referred to in the opinion; and
(xi) The documents incorporated by reference in the Prospectus or
any further amendment or supplement thereto made by the Company prior
to such Time of Delivery (other than the financial statements and
related notes and schedules therein, as to which such counsel need
express no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder,
although such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
documents incorporated by reference in the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time
of Delivery, except for those referred to in the opinion.
Such counsel shall also state as follows: We have not
independently verified the accuracy, completeness or fairness of the
statements made or included in the Registration Statement or the
Prospectus, except as described in specified paragraphs of the
opinion. However, in connection with the preparation by the Company
of the Registration Statement and the Prospectus, we participated in
various discussions and meetings with the Representatives, officers
and other representatives of the Company, and representatives of the
Company's independent public accountants at which the contents of the
Registration Statement and the Prospectus were discussed. No
information has come to our attention which causes us to conclude
(relying as to factual matters to the extent necessary to determine
materiality, upon the opinions of officers and other representatives
of the Company and Holding) that (i) the Registration Statement at
the time it became effective contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and (ii) the Prospectus, or any supplement thereto, on
the date it was filed pursuant to the rules and regulations under the
Act and as of the date hereof, contained an untrue statement of a
material fact or omitted to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading (except, in each case in
respect of the Registration Statement or the Prospectus or any
supplement thereto, that we express no view as to financial
statements and notes thereto, financial schedules and other financial
information included therein or to the exhibits to the Registration
Statement).
(d) Curtis Shaw, Esq., Senior Vice President, General Counsel and
Secretary of the Company and Holding, shall have furnished to you his
written opinion, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
17
(i) Each subsidiary of the Company listed on a schedule attached
to such counsel's opinion (the "Charter Subsidiaries") has been duly
incorporated or formed, as the case may be, and is validly existing as
a corporation or limited liability company, as the case may be, in good
standing under the laws of its jurisdiction of incorporation or
formation; and all of the issued shares of capital stock or limited
liability company interests, as the case may be, of each Charter
Subsidiary have been duly and validly authorized and issued and,
assuming receipt of requisite consideration therefore, are fully paid
and non-assessable;
(ii) Each of the Company and the Charter Subsidiaries has been
duly qualified as a foreign corporation or limited liability company,
as the case may be, for the transaction of business and is in good
standing under the laws of each jurisdiction set forth in a schedule to
such counsel's opinion;
(iii) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the Company or any of its
subsidiaries is the subject which are likely to have, individually or
in the aggregate, a Material Adverse Effect; and, to the best of such
counsel's knowledge and other than as set forth in the Prospectus, no
such proceedings are overtly threatened by governmental authorities or
by others;
(iv) To the best knowledge of such counsel, other than as set
forth in the Prospectus as of the dates set forth therein, there are no
persons with registration or similar rights to have any securities of
the Company or Holding registered pursuant to the Registration
Statement or otherwise registered under the Act and there are no
outstanding options, warrants or other rights calling for the issuance
of, and no commitments, plans or arrangements to issue, any securities
of the Company or Holding or any security convertible into or
exchangeable for securities of the Company or Holding;
(e) Cole, Raywid & Braverman, L.L.P., special regulatory counsel to the
Company and Holding, shall have furnished to you their written opinion,
dated such Time of Delivery, in form and substance reasonably satisfactory
to you, to the effect that:
(i) The issue and sale of the Shares being delivered at such Time
of Delivery by the Company and the compliance by the Company and
Holding with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated do not and will
not contravene the Cable Acts or any order, rule or regulation of the
FCC to which the Company or any of its subsidiaries or any of their
properties is subject;
18
(ii) To the best of such counsel's knowledge, no consent,
approval, authorization or order of, or registration, qualification or
filing with the FCC is required under the Cable Acts or any order, rule
or regulation of the FCC in connection with the issue and sale of the
Shares being delivered at such Time of Delivery and the compliance by
the Company and Holding, as the case may be, with all of the provisions
of this Agreement and the consummation of the transactions herein
contemplated;
(iii) The statements set forth in the Prospectus under the
captions "Risk Factors" under the subheading "Regulatory and
Legislative Matters" and in "Regulation and Legislation," insofar as
they constitute summaries of laws referred to therein, concerning the
Cable Acts and the published rules, regulations and policies
promulgated by the FCC thereunder, fairly summarize the matters
described therein;
(iv) To the knowledge of such counsel based solely upon its
review of publicly available records of the FCC and operational
information provided by the Company's and its subsidiaries' management,
the Company and its subsidiaries hold all FCC licenses for cable
antenna relay services necessary to conduct the business of the Company
and its subsidiaries as currently conducted, except to the extent the
failure to hold such FCC licenses would not, individually and in the
aggregate, be reasonably expected to have a Material Adverse Effect;
(v) Except as disclosed in the Prospectus and except with respect
to rate regulation matters, and general rulemakings and similar matters
relating generally to the cable television industry, to such counsel's
knowledge, based solely upon its review of the publicly available
records of the FCC and upon inquiry of the Company's and its
subsidiaries' management, during the time the cable systems of the
Company and its subsidiaries have been owned by the Company and its
subsidiaries (A) there has been no adverse FCC judgment, order or
decree issued by the FCC relating to the ongoing operations of any of
the Company or one of its subsidiaries that has had or could reasonably
be expected to have a Material Adverse Effect; and (B) there are no
actions, suits, proceedings, inquiries or investigations by or before
the FCC pending or threatened in writing against or specifically
affecting the Company or any of its subsidiaries or any cable system of
the Company or any of its subsidiaries which could, individually or in
the aggregate, be reasonably expected to result in a Material Adverse
Effect;
(f) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of
any post-effective amendment to the Registration Statement filed subsequent
to the date of this Agreement and also at each Time of Delivery, each of
Arthur Andersen LLP, KPMG LLP, Ernst & Young LLP and PriceWaterhouseCoopers
LLP shall have furnished to you a letter or letters, dated the respective
dates of delivery thereof, in form and substance satisfactory to you;
19
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus, and (ii) since the respective dates as of
which information is given in the Prospectus there shall not have been any
change in the capital stock, limited liability company interests or
long-term debt of the Company or any of its subsidiaries or any change, or
any development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' or members' equity,
or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus, the effect of which,
in any such case described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Shares being delivered at such Time of Delivery on the terms and in the
manner contemplated in this Agreement and in the Prospectus;
(h) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded the debt securities of the Company or any of its
subsidiaries by any "nationally recognized statistical rating
organization," as that term is defined by the Commission for purposes of
Rule 436(g)(2) under the Act, and (ii) no such organization shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of any of the debt securities of the
Company or any of its subsidiaries;
(i) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or on the Nasdaq; (ii)
a suspension or material limitation in trading in the Stock on Nasdaq;
(iii) a general moratorium on commercial banking activities declared by
either Federal or New York State authorities; or (iv) the outbreak or
escalation of hostilities involving the United States or the declaration by
the United States of a national emergency or war, if the effect of any such
event specified in this clause (iv) in the judgment of the Representatives
makes it impracticable or inadvisable to proceed with the public offering
or the delivery of the Shares being delivered at such Time of Delivery on
the terms and in the manner contemplated in the Prospectus;
(j) The Shares to be sold at such Time of Delivery shall have been duly
approved for quotation on Nasdaq;
(k) The Company has obtained and delivered to the Underwriters executed
copies of an agreement from the persons and entities named in Schedule II
hereto, substantially to the effect set forth in the lock-up agreements
delivered in connection with the Company's October 2000 issuance of
convertible senior notes;
20
(l) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement; and
(m) The Company and Holding shall have furnished or caused to be
furnished to you at such Time of Delivery certificates of officers of each
of the Company and Holding satisfactory to you as to the accuracy of the
representations and warranties of each of the Company and Holding herein at
and as of such Time of Delivery, as to the performance by each of the
Company and Holding of all of its obligations hereunder to be performed at
or prior to such Time of Delivery, as to the matters set forth in
subsections (a) and (g) of this Section and as to such other matters as you
may reasonably request;
8. (a) The Company and Holding, jointly and severally, will indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the
Company and Holding shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Morgan Stanley &
Co. Incorporated and Goldman, Sachs & Co. expressly for use therein.
(b) The Underwriters, severally and not jointly, will indemnify and
hold harmless the Company and Holding against any losses, claims, damages or
liabilities to which the Company or Holding may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through Morgan Stanley Co. Incorporated and Goldman, Sachs & Co.
expressly for use therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the
21
Company in connection with investigating or defending any such action or claim
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. Any indemnifying party shall not, in connection with any
one action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties. The Company and
Holding shall not be required to indemnify the Underwriters for any amounts paid
or payable by the Underwriters in the settlement of any action, proceeding or
investigation without the written consent of the Company to such settlement,
which consent shall not be unreasonably withheld. No indemnifying party shall,
without the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is an
actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and Holding on the one hand and the
Underwriters on the other from the offering of the Shares. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall
22
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company and Holding on the one hand and the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company and Holding on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Shares purchased under this
Agreement (before deducting expenses) received by the Company and Holding bear
to the total underwriting discounts and commissions received by the Underwriters
with respect to the Shares purchased under this Agreement, in each case as set
forth in the table on the cover page of the Prospectus. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company and Holding on
the one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and Holding and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this subsection
(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company and Holding under this Section 8
shall be in addition to any liability which the Company and Holding may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and Holding and to each person, if any, who controls the Company or
Holding within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the
23
terms contained herein at such Time of Delivery. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Shares, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to you to purchase such Shares on such terms. In the event that,
within the respective prescribed periods, you notify the Company that you have
so arranged for the purchase of such Shares, or the Company notifies you that it
has so arranged for the purchase of such Shares, you or the Company shall have
the right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of all
the Shares to be purchased at such Time of Delivery, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the number of
Shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters (or,
with respect to the Second Time of Delivery, the obligations of the Underwriters
to purchase and of the Company to sell the Optional Shares) then this Agreement
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter, the Company or Holding, except for the expenses to be borne by the
Company, Holding and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and Holding and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Company and Holding or any officer or
24
director or controlling person of the Company or Holding, and shall survive
delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company and Holding shall not then be under any liability to any Underwriter
except as provided in Sections 6 and 8 hereof; but if, for any other reason
other than a termination pursuant to Section 7(i), any Shares are not delivered
by or on behalf of the Company as provided herein, the Company and Holding will
reimburse the Underwriters through you for all out-of-pocket expenses approved
in writing by you, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of the Shares not so delivered, but the Company and Holding shall then
be under no further liability to any Underwriter except as provided in Sections
6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Morgan Stanley & Co. Incorporated and Goldman, Sachs
& Co. on behalf of you as the Representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the Representatives in care of Morgan Stanley &
Co. Incorporated, 1585 Broadway, New York, New York 10036, Attention: High Yield
Capital Markets Department, and Goldman, Sachs & Co., 32 Old Slip, 21st Floor,
New York, New York 10005, Attention: Registration Department; and if to the
Company or Holding shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, Holding and, to the extent provided
in Sections 8 and 10 hereof, the officers and directors of the Company and each
person who controls the Company, or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the Shares from any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
25
15. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
26
If the foregoing is in accordance with your understanding, please sign
and return to us counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Underwriters, the Company and
Holding. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on your part as to
the authority of the signers thereof.
Very truly yours,
Charter Communications, Inc.
By: /s/ Curtis S. Shaw
-------------------------------
Name: Curtis S. Shaw
Title: Senior Vice President, General Counsel
and Secretary
Charter Communications Holding Company, LLC
By: /s/ Curtis S. Shaw
-------------------------------
Name: Curtis S. Shaw
Title: Senior Vice President, General Counsel
and Secretary
27
Accepted as of the date hereof:
Morgan Stanley & Co. Incorporated
Goldman, Sachs & Co.
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
J.P. Morgan Securities LLC
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns
Dresdner Kleinwort Wasserstein Securities LLC
Acting severally on behalf of themselves and the several Underwriters named in
Schedule I hereto.
By: Goldman, Sachs & Co.
By: /s/ Goldman, Sachs & Co.
---------------------------------
Name:
Title:
By: Morgan Stanley & Co. Incorporated
By: /s/ Daniel H. Klausner
---------------------------------
Name: Daniel H. Klausner
Title: Principal
28
SCHEDULE I
Total Number Number of Optional
of Shares to be Purchased if
Firm Shares Maximum Option
Underwriter to be Purchased Exercised
- ----------- --------------- ---------
Morgan Stanley & Co. Incorporated........ 18,336,150 2,750,423
Goldman, Sachs & Co...................... 18,336,150 2,750,423
Banc of America Securities LLC........... 2,619,450 392,917
Bear, Stearns & Co. Inc.................. 2,619,450 392,917
Merrill Lynch, Pierce, Fenner & Smith
Incorporated............................. 2,619,450 392,917
Salomon Smith Barney Inc................. 2,619,450 392,917
J.P. Morgan Securities LLC............... 2,095,560 314,334
Credit Lyonnais Securities (USA) Inc..... 1,047,780 157,167
Fleet Securities, Inc.................... 1,047,780 157,167
BMO Nesbitt Burns........................ 523,890 78,584
Dresdner Kleinwort Wasserstein
Securities LLC........................... 523,890 78,584
---------- ---------
Total 52,389,000 7,858,350
SCHEDULE II
Charter Communications Holding Company, LLC
Charter Investment, Inc.
Vulcan Cable III Inc.
Paul G. Allen
William D. Savoy
Ronald L. Nelson
Nancy B. Peretsman
Howard L. Wood
Marc B. Nathanson
Jerald L. Kent
David C. Andersen
David G. Barford
Mary Pat Blake
Eric A. Freesmeier
Thomas R. Jokerst
Kent D. Kalkwarf
Ralph G. Kelly
David L. McCall
Majid R. Mir
John C. Pietri
Michael E. Riddle
Steven A. Schumm
Curtis S. Shaw
Stephen E. Silva
James (Trey) H. Smith, III
$1,943,000,000
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
9.625% SENIOR NOTES DUE 2009
10.000% SENIOR NOTES DUE 2011
11.750% SENIOR DISCOUNT NOTES DUE 2011
PURCHASE AGREEMENT
Dated May 10, 2001
May 10, 2001
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
JP Morgan, a Division of Chase Securities Inc.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns Corp.
Dresdner Kleinwort Wasserstein Securities LLC
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Charter Communications Holdings, LLC, a Delaware limited
liability company (the "Company"), and Charter Communications Holdings Capital
Corporation, a Delaware corporation ("Charter Capital" and, together with the
Company, the "Issuers"), propose, subject to the terms and conditions stated
herein, to issue and sell to the Purchasers named in Schedule I hereto (the
"Purchasers") (i) an aggregate of $350,000,000 principal amount of 9.625% Senior
Notes due 2009 (the "Eight-Year Senior Notes"), (ii) an aggregate of
$575,000,000 principal amount of 10.000% Senior Notes due 2011 (the "Ten-Year
Senior Notes") and (iii) an aggregate of $1,018,000,000 principal amount at
maturity ($575,190,360 gross proceeds) of 11.750% Senior Discount Notes due 2011
(the "Senior Discount Notes" and, together with the Eight-Year Senior Notes and
the Ten-Year Senior Notes, the "Securities").
It is understood and agreed that Goldman, Sachs & Co. and Morgan
Stanley & Co. Incorporated are joint book-runners and joint lead managers for
the offering of the Securities and any determinations or other actions to be
made under this Agreement by you or the Representatives shall require the
concurrence of both Goldman, Sachs & Co. and Morgan Stanley & Co. Incorporated.
1. The Issuers represent and warrant to, and agree with, each of
the Purchasers that:
(a) An offering memorandum, dated May 10, 2001 (the "Offering
Memorandum"), has been prepared in connection with the offering of the
Securities. The Offering Memorandum and any amendments or supplements
thereto did not and will not, as of their respective dates, contain an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information relating to the Purchasers furnished in writing to the
Issuers by a Purchaser through Goldman, Sachs & Co. and Morgan Stanley
& Co. Incorporated expressly for use therein;
(b) None of the Issuers or any of their subsidiaries has
sustained since the date of the latest audited financial statements
included in the Offering Memorandum any material loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any court or governmental
action, order or decree, otherwise than as set forth or contemplated in
the Offering Memorandum; and, since the respective dates as of which
information is given in the Offering Memorandum, there has not been any
change in the capital stock or limited liability company interests or
long-term debt of the Issuers or any of their subsidiaries or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, members' or stockholders' equity, or
results of operations of the Issuers and their subsidiaries, otherwise
than as set forth or contemplated in the Offering Memorandum;
(c) Each of the Issuers and their subsidiaries has good and
marketable title in fee simple to all real property and good and valid
title to all personal property owned by it reflected as owned in the
financial statements or elsewhere in the Offering Memorandum, in each
case free and clear of all liens, encumbrances and defects except such
as are described in the Offering Memorandum or such as do not
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Issuers
and their subsidiaries; and any real property and buildings held under
lease by the Issuers and their subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as are
not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Issuers and their
subsidiaries;
2
(d) The Company has been duly formed and is validly existing as a
limited liability company in good standing under the laws of the State
of Delaware, and Charter Capital has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware; each of the Issuers has power and authority to
own its properties and conduct its business as described in the
Offering Memorandum and to execute, deliver and perform its obligations
under this Agreement, and has been duly qualified as a foreign
corporation or limited liability company, as the case may be, for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties or conducts
any business so as to require such qualification, and is not subject to
liability or disability by reason of the failure to be so qualified in
any such jurisdiction, except such as would not, individually or in the
aggregate, have a material adverse effect on the current or future
financial position, members' or stockholders' equity or results of
operations of the Issuers and their subsidiaries taken as a whole (a
"Material Adverse Effect"); each "significant subsidiary" (as such term
is defined in Rule 1-02 of Regulation S-X) of the Company (each a
"Significant Subsidiary") has been duly incorporated or formed, as the
case may be, and is validly existing as a corporation or limited
liability company, as the case may be, in good standing under the laws
of its jurisdiction of incorporation or formation; and Charter Capital
has no subsidiaries;
(e) All of the outstanding ownership interests of the Issuers
have been duly and validly authorized and issued and are fully paid and
non-assessable; and all of the outstanding capital stock or limited
liability company interests, as the case may be, of Charter Capital and
each Significant Subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and (except as
otherwise set forth in the Offering Memorandum) are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims;
(f) The Eight-Year Senior Notes have been duly authorized and,
when executed by the Issuers and authenticated by the Trustee (as
defined) in accordance with the provisions of the Eight-Year Senior
Note Indenture (as defined) and when delivered to, and paid for, by the
Purchasers in accordance with the terms of this Agreement, will have
been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Issuers
entitled to the benefits provided by the indenture to be dated as of
May 15, 2001 (the "Eight-Year Senior Note Indenture") between the
Issuers and BNY Midwest Trust Company, as trustee (the "Trustee"),
under which they are to be issued and enforceable against the Issuers
in accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles;
3
(g) The Ten-Year Senior Notes have been duly authorized and, when
executed by the Issuers and authenticated by the Trustee in accordance
with the provisions of the Ten-Year Senior Note Indenture (as defined)
and when delivered to, and paid for, by the Purchasers in accordance
with the terms of this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Issuers entitled to the benefits
provided by the indenture to be dated as of May 15, 2001 (the "Ten-Year
Senior Note Indenture") between the Issuers and the Trustee, under
which they are to be issued and enforceable against the Issuers in
accordance with their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles;
(h) The Senior Discount Notes have been duly authorized and, when
executed by the Issuers and authenticated by the Trustee in accordance
with the provisions of the Senior Discount Note Indenture (as defined)
and when delivered to, and paid for, by the Purchasers in accordance
with the terms of this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Issuers entitled to the benefits
provided by the indenture to be dated as of May 15, 2001 (the "Senior
Discount Note Indenture" and, together with the Eight-Year Senior Note
Indenture and the Ten-Year Senior Note Indenture, the "Indentures")
between the Issuers and the Trustee, under which they are to be issued
and enforceable against the Issuers in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the Securities
will conform to the descriptions thereof in the Offering Memorandum and
will be in substantially the form previously delivered to you;
(i) The Indentures have been duly authorized and, when executed
and delivered by the Issuers (and assuming the due execution and
delivery thereof by the Trustee), the Indentures will constitute valid
and legally binding instruments, enforceable against the Issuers in
accordance with their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; the Indentures meet the requirements for qualification
under the United States Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"); and the Indentures will conform in all material
respects to the descriptions thereof in the Offering Memorandum;
(j) The exchange and registration rights agreements to be entered
into between the Issuers and the Purchasers relating to the Securities,
substantially in the form of Exhibits A, B and C hereto (the
"Registration Rights Agreements"),
4
have been duly authorized by the Issuers, and when executed and
delivered by the Issuers (assuming the due execution and delivery
thereof by the Purchasers), will constitute valid and legally binding
instruments, enforceable against the Issuers in accordance with their
terms, except that (A) the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to creditors' rights and (ii) general principles
of equity, and (B) any rights to indemnity or contribution thereunder
may be limited by federal and state securities laws and public policy
considerations; and the Registration Rights Agreements will conform in
all material respects to the descriptions thereof in the Offering
Memorandum;
(k) The Exchange Notes (as defined in each of the Registration
Rights Agreements) have been duly authorized by the Issuers and, when
executed, authenticated, issued and delivered in accordance with the
Indentures and the Registration Rights Agreements (assuming the due
authorization, execution and delivery of the Indentures by the
Trustee), will constitute valid and legally binding instruments,
entitled to the benefits provided by the Indentures under which they
are to be issued, and enforceable against the Issuers in accordance
with their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; and the Exchange Notes will conform in all material
respects to the descriptions thereof in the Offering Memorandum;
(l) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale
of the Securities) will violate or result in a violation of Section 7
of the Securities Exchange Act of 1934 (the "Exchange Act"), or any
regulation promulgated thereunder, including, without limitation,
Regulations T, U, and X of the Board of Governors of the Federal
Reserve System;
(m) Prior to the date hereof, none of the Issuers or any of their
affiliates has taken any action which is designed to or which has
constituted or which might have been expected to cause or result in
stabilization or manipulation of the price of any security of the
Issuers in connection with the offering of the Securities;
(n) The issue and sale of the Securities and the compliance by
the Issuers with all of the provisions of the Securities, the
Indentures, the Registration Rights Agreements and this Agreement and
the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement, lease, license, franchise
agreement, permit or other agreement or instrument to which the Issuers
or any of their
5
subsidiaries is a party or by which the Issuers or any of their
subsidiaries is bound or to which any of the property or assets of the
Issuers or any of their subsidiaries is subject, nor will such action
result in any violation of any statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over
the Issuers, any of the Issuers' subsidiaries or any of their
properties, including, without limitation, the Communications Act of
1934, as amended, the Cable Communications Policy Act of 1984, as
amended, the Cable Television Consumer Protection and Competition Act
of 1992, as amended, and the Telecommunications Act of 1996
(collectively, the "Cable Acts") or any order, rule or regulation of
the Federal Communications Commission (the "FCC"), except where such
conflicts, breaches, violations or defaults would not, individually and
in the aggregate, have a Material Adverse Effect and would not have the
effect of preventing the Issuers from performing any of their
respective obligations under this Agreement; nor will such action
result in any violation of the certificate of formation or limited
liability company agreement of the Company or the certificate of
incorporation or bylaws of Charter Capital; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required, including, without
limitation, under the Cable Acts or any order, rule or regulation of
the FCC, for the issue and sale of the Securities or the consummation
by the Issuers of the transactions contemplated by this Agreement, the
Indentures or the Registration Rights Agreements, except such consents,
approvals, authorizations, registrations or qualifications as have been
made or except as may be required under state or foreign securities or
Blue Sky laws in connection with the purchase and distribution of the
Securities by the Purchasers and except such as will be made in the
case of the Registration Rights Agreements or such as may be required
by the National Association of Securities Dealers, Inc. ("NASD");
(o) None of the Issuers or any of their subsidiaries is (i) in
violation of its certificate of incorporation, bylaws, certificate of
formation, limited liability company agreement or other organizational
document, as the case may be, (ii) in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement,
lease, license, permit or other agreement or instrument to which it is
a party or by which it or any of its properties may be bound or (iii)
in violation of the terms of any franchise agreement, or any law,
statute, rule or regulation or any judgment, decree or order, in any
such case, of any court or governmental or regulatory agency or other
body having jurisdiction over the Issuers, any of the Issuers'
subsidiaries or any of their properties or assets, including, without
limitation, the Cable Acts or any order, rule or regulation of the FCC,
except, in the case of clauses (ii) and (iii), such as would not,
individually and in the aggregate, have a Material Adverse Effect;
6
(p) The statements set forth in the Offering Memorandum under the
captions "Description of Notes," insofar as they purport to constitute
a summary of the terms of the Securities, under the captions "Risk
Factors," "Business," "Regulation and Legislation," "Management,"
"Certain Relationships and Related Transactions," "Description of
Certain Indebtedness," and "United States Federal Income Tax
Considerations," insofar as they purport to describe the provisions of
the laws, documents and arrangements referred to therein, are accurate
in all material respects;
(q) Other than as set forth in the Offering Memorandum, there are
no legal or governmental proceedings (including, without limitation, by
the FCC or any franchising authority) pending to which the Issuers or
any of their subsidiaries is a party or of which any property of the
Issuers or any of their subsidiaries is the subject which, if
determined adversely to the Issuers or any of their subsidiaries,
would, individually or in the aggregate, have a Material Adverse
Effect; and, to the best knowledge of the Issuers and except as
disclosed in the Offering Memorandum, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(r) Each of the Issuers and their subsidiaries carries insurance
(including self-insurance) in such amounts and covering such risks as
in the reasonable determination of the Issuers is adequate for the
conduct of its business and the value of its properties;
(s) Except as set forth in the Offering Memorandum, there is no
strike, labor dispute, slowdown or work stoppage with the employees of
any of the Issuers or their subsidiaries which is pending or, to the
best knowledge of the Issuers, threatened which would, individually or
in the aggregate, have a Material Adverse Effect;
(t) When the Securities are issued and delivered pursuant to this
Agreement, the Securities will not be of the same class (within the
meaning of Rule 144A under the United States Securities Act of 1933, as
amended, (the "Act") as securities which are listed on a national
securities exchange registered under Section 6 of the Exchange Act or
quoted in a U.S. automated inter-dealer quotation system.
(u) The Issuers are subject to Section 15(d) of the Exchange Act;
(v) Neither Issuer is, or after giving effect to the offering and
sale of the Securities will be, an "investment company" or any entity
"controlled" by an "investment company" as such terms are defined in
the U.S. Investment Company Act of 1940, as amended (the "Investment
Company Act");
7
(w) None of the Issuers or any of their subsidiaries, or any
person acting on their behalf (other than the Purchasers, as to whom
the Issuers and their subsidiaries make no representation) has offered
or sold the Securities by means of any general solicitation or general
advertising within the meaning of Rule 502(c) under the Act or, with
respect to Securities sold outside the United States to non-U.S.
persons (as defined in Rule 902 under the Act), by means of any
directed selling efforts within the meaning of Rule 902 under the Act
and the Issuers, any affiliate of the Issuers and any person acting on
their behalf (other than the Purchasers, as to whom the Issuers and
their affiliates make no representation) has complied with and will
implement the "offering restriction" within the meaning of such Rule
902;
(x) Within the preceding six months, none of the Issuers or any
other person acting on behalf of the Issuers has offered or sold to any
person any Securities, or any securities of the same or a similar class
as the Securities, other than Securities offered or sold to the
Purchasers hereunder. The Issuers will take reasonable precautions
designed to insure that any offer or sale, direct or indirect, in the
United States or to any U.S. person (as defined in Rule 902 under the
Act) of any Securities or any substantially similar security issued by
the Issuers, within six months subsequent to the date on which the
distribution of the Securities has been completed (as notified to the
Issuers by Goldman, Sachs & Co. and Morgan Stanley & Co. Incorporated),
is made under restrictions and other circumstances reasonably designed
not to affect the status of the offer and sale of the Securities in the
United States and to U.S. persons contemplated by this Agreement as
transactions exempt from the registration provisions of the Act;
(y) The audited consolidated financial statements (including the
notes thereto) included in the Offering Memorandum present fairly in
all material respects the respective consolidated financial positions,
results of operations and cash flows of the entities to which they
relate at the dates and for the periods to which they relate and have
been prepared in accordance with U.S. generally accepted accounting
principles ("GAAP") applied on a consistent basis. The summary and
selected financial data in the Offering Memorandum present fairly in
all material respects the information shown therein and have been
prepared and compiled on a basis consistent with the audited financial
statements included therein;
(z) The pro forma financial statements (including the notes
thereto) and the other pro forma financial information included in the
Offering Memorandum (i) comply as to form - in all material respects
with the applicable requirements of Regulation S-X for Form S-3
promulgated under the Exchange Act, and (ii) have been properly
computed on the -- bases described therein; the assumptions used in the
preparation of the pro forma financial data and other pro forma
financial
8
information included in the Offering Memorandum are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein;
(aa) Each of the firms who has certified financial statements
included in the Offering Memorandum are independent public accountants
as required by the Act and the rules and regulations of the Commission
thereunder, based upon representations by such firms to us;
(bb) The Issuers and their subsidiaries own or possess, or can
acquire on reasonable terms, adequate licenses, trademarks, service
marks, trade names and copyrights (collectively, "Intellectual
Property") necessary to conduct the business now or proposed to be
operated by each of them as described in the Offering Memorandum,
except where the failure to own, possess or have the ability to acquire
any Intellectual Property would not, individually and in the aggregate,
have a Material Adverse Effect; and none of the Issuers or any of their
subsidiaries has received any notice of infringement of or conflict
with (and none actually knows of any such infringement of or conflict
with) asserted rights of others with respect to any Intellectual
Property which, if any such assertion of infringement or conflict were
sustained would, individually or in the aggregate, have a Material
Adverse Effect;
(cc) Except as described in the Offering Memorandum, the Issuers
and their subsidiaries have obtained all consents, approvals, orders,
certificates, licenses, permits, franchises and other authorizations of
and from, and have made all declarations and filings with, all
governmental and regulatory authorities (including, without limitation,
the FCC), all self-regulatory organizations and all courts and other
tribunals legally necessary to own, lease, license and use their
respective properties and assets and to conduct their respective
businesses in the manner described in the Offering Memorandum, except
to the extent that the failure to so obtain or file would not,
individually or in the aggregate, have a Material Adverse Effect;
(dd) The Issuers and their subsidiaries have filed all necessary
federal, state and foreign income and franchise tax returns required to
be filed as of the date hereof, except where the failure to so file
such returns would not, individually and in the aggregate, have a
Material Adverse Effect, and have paid all taxes shown as due thereon;
and there is no tax deficiency that has been asserted against the
Issuers or any of their subsidiaries that could reasonably be expected
to result, individually or in the aggregate, in a Material Adverse
Effect;
(ee) The Issuers and their subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable
assurances that
9
(i) transactions are executed in accordance with management's general
or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability
for assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to
any differences;
(ff) Each of the franchises held by the Issuers and their
subsidiaries that are material to the Issuers and their subsidiaries,
taken as a whole, is in full force and effect, with no material
restrictions or qualifications; and to the best knowledge of the
Issuers, no event has occurred which permits, or with notice or lapse
of time or both would permit, the revocation or non-renewal of any such
franchises, assuming the filing of timely renewal applications and the
timely payment of all applicable filing and regulatory fees to the
applicable franchising authority, or which might result, individually
or in the aggregate, in any other material impairment of the rights of
the Issuers and their subsidiaries in the franchises. Except as
described in the Offering Memorandum, the Issuers have no reason to
believe that any franchise that is required for the operation of the
Issuers and their subsidiaries will not be renewed in the ordinary
course; and
(gg) The Issuers and their subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, individually and in the aggregate,
have a Material Adverse Effect.
2. (a) Subject to the terms and conditions herein set forth, the
Issuers agree to issue and sell to each of the Purchasers, and each of the
Purchasers agrees, severally and not jointly, to purchase from the Issuers, at a
purchase price of 98.00% of the principal amount thereof, plus accrued interest,
if any, from May 15, 2001 to the Time of Delivery hereunder, the principal
amount of the Eight-Year Senior Notes set forth opposite the name of such
Purchaser in Schedule I hereto.
10
(b) Subject to the terms and conditions herein set forth, the
Issuers agree to issue and sell to each of the Purchasers, and each of the
Purchasers agrees, severally and not jointly, to purchase from the Issuers, at a
purchase price of 98.00% of the principal amount thereof, plus accrued interest,
if any, from May 15, 2001 to the Time of Delivery hereunder, the principal
amount of the Ten-Year Senior Notes set forth opposite the name of such
Purchaser in Schedule I hereto.
(c) Subject to the terms and conditions herein set forth, the
Issuers agree to issue and sell to each of the Purchasers, and each of the
Purchasers agrees, severally and not jointly, to purchase from the Issuers, at a
purchase price of 97.75% of the initial accreted value thereof, plus accretion,
if any, from May 15, 2001 to the Time of Delivery hereunder, the principal
amount at maturity of Senior Discount Notes set forth opposite the name of such
Purchaser in Schedule I hereto.
(d) The Purchasers agree to apply $243,056 as a credit against
the aggregate underwriting discount of $31,441,783 that the Purchasers would
otherwise receive pursuant to the foregoing paragraphs (a), (b) and (c).
Accordingly, the aggregate purchase price for the Notes payable by the
Purchasers to the Issuers shall be $1,468,991,632.
3. Upon the authorization by you of the release of the
Securities, the several Purchasers propose to offer the Securities for sale upon
the terms and conditions set forth in this Agreement and the Offering Memorandum
and each Purchaser hereby represents and warrants to, and agrees with the
Issuers that:
(a) It will offer and sell the Securities only: (i) to persons
who it reasonably believes are "qualified institutional buyers"
("QIBs") within the meaning of Rule 144A under the Act in transactions
meeting the requirements of Rule 144A or (ii) upon the terms and
conditions set forth in Annex I to this Agreement;
(b) It is a QIB; and
(c) It has not offered and will not offer or sell the Securities
by any form of general solicitation or general advertising, including
but not limited to the methods described in Rule 502(c) under the Act.
4. (a) The Securities to be purchased by each Purchaser hereunder
will be represented by definitive global Securities in book-entry form which
will be deposited by or on behalf of the Issuers with The Depository Trust
Company ("DTC") or its designated custodian. The Issuers will deliver the
Securities to Goldman, Sachs & Co., for the account of each Purchaser, against
payment by or on behalf of such Purchaser of the purchase price therefor by wire
transfer of same day funds wired in accordance with
11
the written instructions of the Company, by causing DTC to credit the Securities
to the account of Goldman, Sachs & Co. at DTC. The Issuers will cause the
certificates representing the Securities to be made available to Goldman, Sachs
& Co. for checking at least twenty-four hours prior to the Time of Delivery (as
defined below) at the office of DTC or its designated custodian (the "Designated
Office"). The time and date of such delivery and payment shall be 9:30 a.m., New
York City time, on May 15, 2001 or such other time and date as Goldman, Sachs &
Co. and Morgan Stanley & Co. Incorporated and the Issuers may agree upon in
writing. Such time and date are herein called the "Time of Delivery."
(b) The documents to be delivered at the Time of Delivery by
or on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Securities and any additional documents requested by the
Purchasers pursuant to Section 7(j) hereof, will be delivered at such time and
date at the offices of Paul, Hastings, Janofsky & Walker LLP, 399 Park Avenue,
New York, New York 10022 or such other location as the parties mutually agree
(the "Closing Location"), and the Securities will be delivered at the Designated
Office, all at the Time of Delivery. A meeting will be held at the Closing
Location at 3 p.m., New York City time, on the New York Business Day next
preceding the Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. Each of the Issuers agrees with each of the Purchasers:
(a) To prepare the Offering Memorandum in a form approved by you;
to make no amendment or any supplement to the Offering Memorandum which
shall be disapproved by you promptly after reasonable notice thereof;
and to furnish you with copies thereof;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities for offering and sale
under the securities laws of such jurisdictions as you may request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the Securities, provided that in
connection therewith the Issuers shall not be required to qualify as a
foreign corporation or limited liability company, as the case may be,
or to file a general consent to service of process in any jurisdiction;
(c) To furnish the Purchasers with copies of the Offering
Memorandum and each amendment or supplement thereto signed by an
authorized officer of
12
each of the Issuers with the independent accountants' reports in the
Offering Memorandum, and any amendment or supplement containing
amendments to the financial statements covered by such reports, signed
by the accountants, and additional copies thereof in such quantities as
you may from time to time reasonably request, and if, at any time prior
to the expiration of nine months after the date of the Offering
Memorandum, any event shall have occurred as a result of which the
Offering Memorandum as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Offering Memorandum
is delivered, not misleading, or, if for any other reason it shall be
necessary or desirable during such same period to amend or supplement
the Offering Memorandum, to notify you and upon your request to prepare
and furnish without charge to each Purchaser and to any dealer in
securities as many copies as you may from time to time reasonably
request of an amended Offering Memorandum or a supplement to the
Offering Memorandum which will correct such statement or omission or
effect such compliance;
(d) During the period beginning from the date hereof and
continuing until the date six months after the Time of Delivery, not to
offer, sell, contract to sell or otherwise dispose of, except as
provided hereunder, any securities of the Issuers that are
substantially similar to the Securities;
(e) Not to be or become, at any time prior to the expiration of
two years after the Time of Delivery, an open-end investment company,
unit investment trust, closed-end investment company or face-amount
certificate company that is or is required to be registered under
Section 8 of the Investment Company Act;
(f) At any time when any Issuer is not subject to Section 13 or
15(d) of the Exchange Act, for the benefit of holders from time to time
of Securities, to furnish at the Issuers' expense, upon request, to
holders of Securities and prospective purchasers of securities
information (the "Additional Issuer Information") satisfying the
requirements of subsection (d)(4)(i) of Rule 144A under the Act;
(g) To use its best efforts to cause the Securities to be
eligible for the PORTAL trading system of the NASD;
(h) To furnish to the holders of the Securities as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, members' or
stockholders' equity and cash flows of the Issuers and their
consolidated subsidiaries certified by independent public accountants)
and, as soon as practicable after the end of each of the first three
13
quarters of each fiscal year (beginning with the fiscal quarter ending
after the date of the Offering Memorandum), to make available to
holders of the Securities consolidated summary financial information of
the Issuers and their subsidiaries for such quarter in reasonable
detail;
(i) During a period of three years from the date of the Offering
Memorandum, to furnish to you copies of all reports or other
communications (financial or other) furnished to holders of ownership
interests of the Issuers or Charter Communications, Inc., and to
deliver to you as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any
securities exchange on which the Securities or any class of securities
of the Issuers or Charter Communications, Inc. is listed;
(j) During the period of two years after the Time of Delivery,
the Issuers will not, and will not permit any of their "affiliates" (as
defined in Rule 144 under the Act) to, resell any of the Securities
which constitute "restricted securities" under Rule 144 that have been
reacquired by any of them; and
(k) To use the net proceeds received from the sale of the
Securities pursuant to this Agreement in the manner specified in the
Offering Memorandum under the caption "Use of Proceeds."
6. Each of the Issuers covenants and agrees with the several
Purchasers that the Issuers will pay or cause to be paid the following: (i) the
fees, disbursements and expenses of the Issuers' counsel and accountants in
connection with the issue of the Securities and all other expenses in connection
with the preparation, printing and filing of the Offering Memorandum and any
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Purchasers and dealers; (ii) the cost of printing or producing
any Agreement among Purchasers, this Agreement, the Indentures, the Registration
Rights Agreements, the Blue Sky and Legal Investment Memoranda, closing
documents (including any compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Securities;
(iii) all expenses in connection with the qualification of the Securities for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Purchasers in
connection with such qualification and in connection with the Blue Sky and Legal
Investment surveys; (iv) any fees charged by securities rating services for
rating the Securities; (v) the cost of preparing the Securities; (vi) the fees
and expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Indentures and
the Securities; (vii) any cost incurred in connection with the designation of
the Securities for trading in PORTAL; and (viii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8
14
and 11 hereof, the Purchasers will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of any of the
Securities by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Purchasers hereunder shall be subject,
in their discretion, to the condition that all representations and warranties
and other statements of the Issuers herein are, at and as of the Time of
Delivery, true and correct, the condition that the Issuers shall have performed
all of their obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) Debevoise & Plimpton, counsel for the Purchasers, shall have
furnished to you such opinion or opinions, dated the Time of Delivery,
with respect to the matters covered in paragraphs (i), (iv), (v), (vi),
(vii), (viii), (xii) (as to the Securities) and (xiii) and the last
paragraph of subsection (b) below as well as such other related matters
as you may reasonably request, and such counsel shall have received
such papers and information as they may reasonably request to enable
them to pass upon such matters;
(b) Paul, Hastings, Janofsky & Walker LLP, counsel for the
Issuers, shall have furnished to you their written opinion, dated the
Time of Delivery, in form and substance satisfactory to you, to the
effect that:
(i) The Company has been duly formed and is validly
existing as a limited liability company in good standing under
the laws of the State of Delaware, and Charter Capital has been
duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware; each of
the Issuers has power and authority (corporate or other) to own
or lease its properties and conduct its business as described in
the Offering Memorandum and to execute, deliver and perform its
obligations under this Agreement;
(ii) All of the issued shares of capital stock of Charter
Capital have been duly and validly authorized and issued and,
assuming receipt of requisite consideration therefor, are fully
paid and non-assessable;
(iii) To the best of such counsel's knowledge and other
than as set forth in the Offering Memorandum, there are no legal
or governmental proceedings pending to which the Issuers or any
of their subsidiaries is a party or of which any property of the
Issuers or any of their subsidiaries is the subject which are
likely to have, individually or in the aggregate, a Material
Adverse Effect; and, to the best of such counsel's knowledge and
other than as set forth in the Offering Memorandum, no such
proceedings are overtly threatened by governmental authorities or
by others;
15
(iv) This Agreement has been duly authorized, executed and
delivered by each of the Issuers;
(v) The Securities have been duly authorized by the
Issuers, and, when executed and authenticated in accordance with
the provisions of the Indentures and delivered to and paid for by
the Purchasers in accordance with the terms of this Agreement,
will be valid and legally binding obligations of the Issuers,
entitled to the benefits provided by the Indentures and
enforceable against the Issuers in accordance with their terms,
subject, as to enforcement, to applicable bankruptcy,
reorganization, insolvency or other similar laws affecting
creditors' rights generally and to general equity principles;
(vi) The Indentures have been duly authorized, executed and
delivered by the Issuers and (assuming the due execution and
delivery thereof by the Trustee) constitute valid and legally
binding instruments, enforceable against the Issuers in
accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(vii) The Registration Rights Agreements have been duly
authorized, executed and delivered by the Issuers and (assuming
the due execution and delivery thereof by the Purchasers)
constitute valid and legally binding instruments, enforceable
against the Issuers in accordance with their terms, except that
(A) the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization and other laws of general
applicability relating to creditors' rights and (ii) general
principles of equity, and (B) any rights to indemnity or
contribution thereunder may be limited by federal and state
securities laws and public policy considerations;
(viii) The Exchange Notes have been duly authorized by the
Issuers and, when executed, authenticated, issued and delivered
in accordance with the Indentures and the Registration Rights
Agreements (assuming the due authorization, execution and
delivery of the Indentures and the authentication of the Exchange
Notes by the Trustee), will constitute valid and legally binding
obligations, entitled to the benefits provided by the Indentures
under which they are to be issued, and enforceable against the
Issuers in accordance with their terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general equity principles;
16
(ix) The Securities, the Exchange Notes, the Indentures and
the Registration Rights Agreements conform in all material
respects to the descriptions thereof in the Offering Memorandum;
(x) The issue and sale of the Securities and the compliance
by the Issuers with all of the provisions of the Securities, the
Indentures, the Registration Rights Agreements and this Agreement
and the consummation of the transactions herein and therein
contemplated will not, to the best of such counsel's knowledge,
result in a material breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement, lease, license, permit
or other agreement or instruments specifically identified to such
counsel by the Issuers as material to the Issuers on a schedule,
nor will any such action result in any violation of the
provisions of the certificate of incorporation or by-laws, or
certificate of formation or limited liability company agreement,
as the case may be, of the Issuers or any Federal or New York
State statute or any order, rule or regulation of any Federal or
New York State court or governmental agency or body having
jurisdiction over the Issuers, the subsidiaries of the Issuers or
any of their properties;
(xi) No consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body referred to in paragraph (x) is
required for the issue and sale of the Securities or the
consummation by the Issuers of the transactions contemplated by
this Agreement, the Indentures or the Registration Rights
Agreements, except such consents, approvals, authorizations,
registrations or qualifications as have been obtained or as may
be required under state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of the Securities
by the Purchasers and except such as will be made in the case of
the Registration Rights Agreements or as may be required by the
NASD;
(xii) The statements set forth in the Offering Memorandum
under the caption "Description of Notes," insofar as they purport
to constitute a summary of the terms of the Securities, and under
the captions "Description of Certain Indebtedness" and "United
States Federal Income Tax Considerations," insofar as they
purport to describe the provisions of the laws and documents
referred to therein, fairly summarize the provisions of any such
laws and documents in all material respects;
(xiii) Assuming the accuracy of the representations and
warranties of the Issuers contained in Sections 1(w) and (x) of
this Agreement and the representations and warranties of the
Purchasers contained in Section 3
17
of this Agreement, no registration of the Securities under the
Act, and no qualification of an indenture under the Trust
Indenture Act with respect thereto, is required for the offer,
sale and initial resale of the Securities by the Purchasers in
the manner contemplated by this Agreement; and
(xiv) Neither of the Issuers is an "investment company" or
an entity "controlled" by an "investment company," as such terms
are defined in the Investment Company Act.
Such counsel shall also state as follows: We have not
independently verified the accuracy, completeness or fairness of the
statements made or included in the Offering Memorandum, except as
described in specified paragraphs of the opinion. However, in
connection with the preparation by the Company of the Offering
Memorandum, we participated in various discussions and meetings with
the Purchasers' representatives, officers and other representatives of
the Company, and representatives of the Company's independent public
accountants at which the contents of the Offering Memorandum were
discussed. No information has come to our attention which causes us to
conclude (relying as to materiality to a large extent upon opinions of
officers and other representatives of the Issuers) that the Offering
Memorandum contained as of its date or contains as of the Time of
Delivery an untrue statement of a material fact or omitted or omits, as
the case may be, to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading (except, that we express no view as to
financial statements and notes thereto and other financial information
included therein).
(c) Cole, Raywid & Braverman, L.L.P., special regulatory counsel
to the Issuers, shall have furnished to you their written opinion,
dated the Time of Delivery, in form and substance reasonably
satisfactory to you, to the effect that:
(i) The issue and sale of the Securities and the compliance
by the Issuers with all of the provisions of the Securities, the
Indentures, the Registration Rights Agreements and this Agreement
and the consummation of the transactions herein and therein
contemplated do not and will not contravene the Cable Acts or any
order, rule or regulation of the FCC to which the Issuers or any
of their subsidiaries or any of their property is subject;
(ii) To the best of such counsel's knowledge, no consent,
approval, authorization or order of, or registration,
qualification or filing with the FCC is required under the Cable
Acts or any order, rule or regulation of the FCC in connection
with the issue and sale of the Securities and the compliance by
the Issuers with all of the provisions of
18
the Securities, the Indentures, the Registration Rights
Agreements and this Agreement and the consummation of the
transactions herein and therein contemplated;
(iii) The statements set forth in the Offering Memorandum
under the captions "Risk Factors" under the subheading
"Regulatory and Legislative Matters" and in "Regulation and
Legislation," insofar as they constitute summaries of laws
referred to therein, concerning the Cable Acts and the published
rules, regulations and policies promulgated by the FCC
thereunder, fairly summarize the matters described therein;
(iv) To the knowledge of such counsel based solely upon its
review of publicly available records of the FCC and operational
information provided by the Company's and its subsidiaries'
management, the Company and its subsidiaries hold all FCC
licenses for cable antenna relay services necessary to conduct
the business of the Company and its subsidiaries as currently
conducted, except to the extent the failure to hold such FCC
licenses would not, individually and in the aggregate, be
reasonably expected to have a Material Adverse Effect; and
(v) Except as disclosed in the Offering Memorandum and
except with respect to rate regulation matters, and general
rulemakings and similar matters relating generally to the cable
television industry, to such counsel's knowledge, based solely
upon its review of the publicly available records of the FCC and
upon inquiry of the Company's and its subsidiaries' management,
during the time the cable systems of the Company and its
subsidiaries have been owned by the Company and its subsidiaries
(A) there has been no adverse FCC judgment, order - or decree
issued by the FCC relating to the ongoing operations of any of
the Company or one of its subsidiaries that has had or could
reasonably be expected to have a Material Adverse Effect; and (B)
there are no actions, - suits, proceedings, inquiries or
investigations by or before the FCC pending or threatened in
writing against or specifically affecting the Company or any of
its subsidiaries or any cable system of the Company or any of its
subsidiaries which could, individually or in the aggregate, be
reasonably expected to result in a Material Adverse Effect;
(d) Curtis Shaw, Esq., General Counsel of the Company, shall have
furnished to you his written opinion, dated the Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) Each subsidiary of the Company listed on a schedule
attached to such counsel's opinion (the "Charter Subsidiaries")
has been duly
19
incorporated or formed, as the case may be, and is validly
existing as a corporation or limited liability company, as the
case may be, in good standing under the laws of its jurisdiction
of incorporation or formation; and all of the issued shares of
capital stock or limited liability company interests, as the case
may be, of each Charter Subsidiary have been duly and validly
authorized and issued and, assuming receipt of requisite
consideration therefor, are fully paid and non-assessable;
(ii) Each of the Issuers and the Charter Subsidiaries has
been duly qualified as a foreign corporation or limited liability
company, as the case may be, for the transaction of business and
is in good standing under the laws of each jurisdiction set forth
in a schedule to such counsel's opinion;
(iii) To the best of such counsel's knowledge and other
than as set forth in the Offering Memorandum, there are no legal
or governmental proceedings pending to which the Issuers or any
of their subsidiaries is party or of which any property of the
Issuers or any of their subsidiaries is the subject which are
likely to have, individually or in the aggregate, a Material
Adverse Effect; and, to the best of such counsel's knowledge and
other than as set forth in the Offering Memorandum, no such
proceedings are overtly threatened by governmental authorities or
by others; and
(e) On the date of the Offering Memorandum prior to the execution
of this Agreement and also at the Time of Delivery, each of Arthur
Andersen LLP and KPMG LLP shall have furnished to you a letter or
letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to you;
(f) (i) None of the Issuers or any of their subsidiaries shall
have sustained since the date of the latest audited financial
statements included in the Offering Memorandum any loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any court or governmental
action, order or decree, otherwise than as set forth or contemplated in
the Offering Memorandum, and (ii) since the respective dates as of
which information is given in the Offering Memorandum there shall not
have been any change in the capital stock, limited liability company
interests or long-term debt of the Issuers or any of their subsidiaries
or any change, or any development involving a prospective change, in or
affecting the general affairs, management, financial position,
stockholders' or members' equity, or results of operations of the
Issuers and their subsidiaries, otherwise than as set forth or
contemplated in the Offering Memorandum, the effect of which, in any
such case described in clause (i) or (ii), is in the judgment of the
Purchasers so material and adverse as to make it impracticable or
inadvisable to proceed with the offering or the delivery
20
of the Securities on the terms and in the manner contemplated in this
Agreement and in the Offering Memorandum;
(g) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the debt securities of either of the
Issuers by any "nationally recognized statistical rating organization,"
as that term is defined by the Commission for purposes of Rule
436(g)(2) under the Act, and (ii) no such organization shall have
publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the debt
securities of either of the Issuers;
(h) On or after the date hereof there shall not have occurred any
of the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or on the Nasdaq
National Market; (ii) a suspension or material limitation in trading in
Charter Communications, Inc.'s Class A common stock on the Nasdaq
National Market, (iii) a general moratorium on commercial banking
activities declared by either Federal or New York State authorities; or
(iv) the outbreak or escalation of hostilities or the declaration of a
national emergency or war, if the effect of any such event specified in
this clause (iv) in the judgment of the Purchasers makes it
impracticable or inadvisable to proceed with the offering or the
delivery of the Securities on the terms and in the manner contemplated
in the Offering Memorandum;
(i) The Securities have been designated for trading on PORTAL;
(j) The Issuers shall have furnished or caused to be furnished to
you at the Time of Delivery certificates of officers of each Issuer
satisfactory to you as to the accuracy of the representations and
warranties of the Issuers herein at and as of such Time of Delivery, as
to the performance by the Issuers of all of their obligations hereunder
to be performed at or prior to such Time of Delivery, as to the matters
set forth in subsections (f) and (g) of this Section and as to such
other matters as you may reasonably request.
8. (a) The Issuers, jointly and severally, will indemnify and
hold harmless each Purchaser against any losses, claims, damages or liabilities,
joint or several, to which such Purchaser may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Offering Memorandum, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact necessary to make the
statements therein not misleading, and will reimburse each Purchaser for any
legal or other expenses reasonably incurred by such Purchaser in connection with
investigating or defending any such action or claim as such expenses are
21
incurred; provided, however, that the Issuers shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in the Offering Memorandum or any such amendment or
supplement in reliance upon and in conformity with written information relating
to the Purchasers furnished to the Issuers by any Purchaser through Goldman,
Sachs & Co. and Morgan Stanley & Co. Incorporated expressly for use therein.
(b) The Purchasers, severally and not jointly, will indemnify
and hold harmless the Issuers against any losses, claims, damages or liabilities
to which the Issuers may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in the Offering Memorandum, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Offering Memorandum or any such amendment or supplement
in reliance upon and in conformity with written information relating to the
Purchasers furnished to the Issuers by such Purchaser through Goldman, Sachs &
Co. and Morgan Stanley & Co. Incorporated expressly for use therein; and will
reimburse the Issuers for any legal or other expenses reasonably incurred by the
Issuers in connection with investigating or defending any such action or claim
as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. Any indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be
22
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties. The Issuers shall
not be required to indemnify the Purchasers for any amounts paid or payable by
the Purchasers in the settlement of any action, proceeding or investigation
without the written consent of the Company, which consent shall not be
unreasonably withheld. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to,
or an admission of, fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Issuers on the one hand and the Purchasers on
the other from the offering of the Securities. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Issuers on the one hand and the Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Issuers on the one hand and the Purchasers on the other shall be deemed to be in
the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Issuers bear to the total underwriting
discounts and commissions received by the Purchasers, in each case as set forth
in the Offering Memorandum. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Issuers on the one hand or the Purchasers
on the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Issuers
and the Purchasers agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
the Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of
23
the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to investors were offered to
investors exceeds the amount of any damages which such Purchaser has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. The Purchasers' obligations in this subsection (d)
to contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Issuers under this Section 8 shall
be in addition to any liability which the Issuers may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Purchaser within the meaning of the Act; and the obligations of the
Purchasers under this Section 8 shall be in addition to any liability which the
respective Purchasers may otherwise have and shall extend, upon the same terms
and conditions, to each officer and director of the Issuers and to each person,
if any, who controls the Issuers within the meaning of the Act.
9. (a) If any Purchaser shall default in its obligation to
purchase the Securities which it has agreed to purchase hereunder, you may in
your discretion arrange for you or another party or other parties to purchase
such Securities on the terms contained herein. If within thirty-six hours after
such default by any Purchaser you do not arrange for the purchase of such
Securities, then the Issuers shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to you
to purchase such Securities on such terms. In the event that, within the
respective prescribed periods, you notify the Issuers that you have so arranged
for the purchase of such Securities, or the Issuers notify you that they have so
arranged for the purchase of such Securities, you or the Issuers shall have the
right to postpone the Time of Delivery for a period of not more than seven days,
in order to effect whatever changes may thereby be made necessary in the
Offering Memorandum, or in any other documents or arrangements, and the Issuers
agree to prepare promptly any amendments to the Offering Memorandum which in
your opinion may thereby be made necessary. The term "Purchaser" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Securities.
(b) If, after giving effect to any arrangements for the
purchase of the Securities of a defaulting Purchaser or Purchasers by you and
the Issuers as provided in subsection (a) above, the aggregate principal amount
of such Securities which remains unpurchased does not exceed one-tenth of the
aggregate principal amount of all the Securities, then the Issuers shall have
the right to require each non-defaulting Purchaser to purchase the principal
amount of Securities which such Purchaser agreed to purchase
24
hereunder and, in addition, to require each non-defaulting Purchaser to purchase
its pro rata share (based on the principal amount of Securities which such
Purchaser agreed to purchase hereunder) of the Securities of such defaulting
Purchaser or Purchasers for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Purchaser from liability for its
default.
(c) If, after giving effect to any arrangements for the
purchase of the Securities of a defaulting Purchaser or Purchasers by you and
the Issuers as provided in subsection (a) above, the aggregate principal amount
of Securities which remains unpurchased exceeds one-tenth of the aggregate
principal amount of all the Securities, or if the Issuers shall not exercise the
right described in subsection (b) above to require non-defaulting Purchasers to
purchase Securities of a defaulting Purchaser or Purchasers, then this Agreement
shall thereupon terminate, without liability on the part of any non-defaulting
Purchaser or the Issuers, except for the expenses to be borne by the Issuers and
the Purchasers as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Purchaser from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Issuers and the several Purchasers, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Purchaser or any controlling person of any Purchaser, or the
Issuers, or any officer or director or controlling person of the Issuers, and
shall survive delivery of and payment for the Securities.
11. If this Agreement shall be terminated pursuant to Section 9
hereof, the Issuers shall not then be under any liability to any Purchaser
except as provided in Sections 6 and 8 hereof; but, if for any other reason
other than a termination pursuant to Section 7(h), the Securities are not
delivered by or on behalf of the Issuers as provided herein, the Issuers will
reimburse the Purchasers through you for all out-of-pocket expenses approved in
writing by you, including fees and disbursements of counsel, reasonably incurred
by the Purchasers in making preparations for the purchase, sale and delivery of
the Securities, but the Issuers shall then be under no further liability to any
Purchaser except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of
the Purchasers, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Purchaser made or
given by you jointly or by Goldman, Sachs & Co. and Morgan Stanley & Co.
Incorporated on behalf of you as Purchasers.
25
All statements, requests, notices and agreements hereunder shall
be in writing, and if to the Purchasers shall be delivered or sent by mail,
telex or facsimile transmission to you as Purchasers in care of Goldman, Sachs &
Co., 32 Old Slip, 9th Floor, New York, New York 10005, Attention: Registration
Department and Morgan Stanley & Co. Incorporated, 1585 Broadway, New York, New
York 10036, Attention: High Yield Capital Markets Department; and if to the
Issuers shall be delivered or sent by mail, telex or facsimile transmission to
the address of the Issuers set forth in the Offering Memorandum, Attention:
Secretary; provided, however, that any notice to a Purchaser pursuant to Section
8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission
to such Purchaser at its address set forth in its Purchasers' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Issuers by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Purchasers, the Issuers, and, to the extent provided in Sections
8 and 10 hereof, the officers and directors of the Issuers and the Purchasers
and each person who controls the Issuers or any Purchaser, and their respective
heirs, executors, administrators, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement. No
purchaser of any of the Securities from any Purchaser shall be deemed a
successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such respective counterparts shall together constitute
one and the same instrument.
26
If the foregoing is in accordance with your understanding, please
sign and return to us counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Purchasers, this letter and such acceptance hereof
shall constitute a binding agreement between each of the Purchasers and the
Issuers. It is understood that your acceptance of this letter on behalf of each
of the Purchasers is pursuant to the authority set forth in a form of Agreement
among Purchasers, the form of which shall be submitted to the Issuers for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
Very truly yours,
Charter Communications Holdings, LLC
By: /s/ KENT D. KALKWARF
---------------------------------
Name: Kent D. Kalkwarf
Title: Executive Vice President and
Chief Financial Officer
Charter Communications Holdings Capital Corporation
By: /s/ KENT D. KALKWARF
---------------------------------
Name: Kent D. Kalkwarf
Title: Executive Vice President and
Chief Financial Officer
Accepted as of the date hereof
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
JP Morgan, a Division of Chase Securities Inc.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns Corp.
Dresdner Kleinwort Wasserstein Securities LLC
27
Acting severally on behalf of themselves and the
several Purchasers named in Schedule I hereto.
By: Goldman, Sachs & Co.
By: /s/ GOLDMAN, SACHS & CO.
--------------------------
Name:
Title:
By: Morgan Stanley & Co. Incorporated
/s/ DANIEL H. KLAUSNER
- --------------------------------
Name: Daniel H. Klausner
Title: Principal
28
SCHEDULE I
Principal Amount of
Eight-Year Senior Notes
Purchaser to be Purchased
- --------- ---------------
Goldman, Sachs & Co. ................................... $ 122,500,000
Morgan Stanley & Co. Incorporated....................... 122,500,000
Banc of America Securities LLC.......................... 17,500,000
Bear, Stearns & Co. Inc................................. 17,500,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated...... 17,500,000
Salomon Smith Barney Inc................................ 17,500,000
JP Morgan, a Division of Chase Securities Inc........... 14,000,000
Credit Lyonnais Securities (USA) Inc.................... 7,000,000
Fleet Securities, Inc................................... 7,000,000
BMO Nesbitt Burns Corp.................................. 3,500,000
Dresdner Kleinwort Wasserstein Securities LLC........... 3,500,000
-----------
Total........................................... $ 350,000,000
==============
Principal Amount of
Ten-Year Senior Notes
Purchaser to be Purchased
- --------- ---------------
Goldman, Sachs & Co..................................... $ 201,250,000
Morgan Stanley & Co. Incorporated....................... 201,250,000
Banc of America Securities LLC.......................... 28,750,000
Bear, Stearns & Co. Inc................................. 28,750,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated...... 28,750,000
Salomon Smith Barney Inc................................ 28,750,000
JP Morgan, a Division of Chase Securities Inc........... 23,000,000
Credit Lyonnais Securities (USA) Inc.................... 11,500,000
Fleet Securities, Inc................................... 11,500,000
BMO Nesbitt Burns Corp.................................. 5,750,000
Dresdner Kleinwort Wasserstein Securities LLC........... 5,750,000
-----------
Total........................................... $ 575,000,000
==============
29
Principal Amount at
Maturity of Senior
Discount Notes
Purchaser to be Purchased
- --------- ---------------
Goldman, Sachs & Co..................................... $ 356,300,000
Morgan Stanley & Co. Incorporated....................... 356,300,000
Banc of America Securities LLC.......................... 50,900,000
Bear, Stearns & Co. Inc................................. 50,900,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated...... 50,900,000
Salomon Smith Barney Inc................................ 50,900,000
JP Morgan, a Division of Chase Securities Inc........... 40,720,000
Credit Lyonnais Securities (USA) Inc.................... 20,360,000
Fleet Securities, Inc................................... 20,360,000
BMO Nesbitt Burns Corp.................................. 10,180,000
Dresdner Kleinwort Wasserstein Securities LLC........... 10,180,000
-----------
Total........................................... $ 1,018,000,000
================
30
ANNEX I
(1) The Securities have not been and will not be registered under the
Act and may not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with Regulation S under
the Act or pursuant to an exemption from the registration requirements of the
Act. Each Purchaser represents that it has offered and sold the Securities, and
will offer and sell the Securities (i) as part of their distribution at any time
and (ii) otherwise until 40 days after the later of the commencement of the
offering and the Time of Delivery, only in accordance with Rule 903 of
Regulation S or Rule 144A or pursuant to Paragraph 2 of this Annex I under the
Act. Accordingly, each Purchaser agrees that neither it, its affiliates nor any
persons acting on its or their behalf has engaged or will engage in any directed
selling efforts with respect to the Securities, and it and they have complied
and will comply with the offering restrictions requirement of Regulation S. Each
Purchaser agrees that, at or prior to confirmation of sale of Securities (other
than a sale pursuant to Rule 144A), it will have sent to each distributor,
dealer or person receiving a selling concession, fee or other remuneration that
purchases Securities from it during the restricted period a confirmation or
notice to substantially the following effect:
"The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933 (the "Securities Act") and may not be offered and
sold within the United States or to, or for the account or benefit of, U.S.
persons (i) as part of their distribution at any time or (ii) otherwise
until 40 days after the later of the commencement of the offering and the
closing date, except in either case in accordance with Regulation S (or
Rule 144A if available) under the Securities Act. Terms used above have the
meaning given to them by Regulation S."
Terms used in this paragraph have the meanings given to them by Regulation S.
Each Purchaser further agrees that it has not entered and will
not enter into any contractual arrangement with respect to the distribution or
delivery of the Securities, except with its affiliates or with the prior written
consent of the Issuers.
(2) Notwithstanding the foregoing, Securities in registered form may be
offered, sold and delivered by the Purchasers in the United States and to U.S.
persons pursuant to Section 3 of this Agreement without delivery of the written
statement required by paragraph (1) above.
(3) Each Purchaser further represents and agrees that (i) it has not
offered or sold and prior to the date six months after the date of issue of the
Securities will not offer or sell any Securities to persons in the United
Kingdom except to persons whose ordinary activities involve them in acquiring,
holding, managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances
B-1
which have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities Regulations
1995, (ii) it has complied, and will comply, with all applicable provisions of
the Financial Services Act 1986 of the United Kingdom with respect to anything
done by it in relation to the Securities in, from or otherwise involving the
United Kingdom, and (iii) it has only issued or passed on and will only issue or
pass on in the United Kingdom any document received by it in connection with the
issuance of the Securities to a person who is of a kind described in Article
11(3) of the Financial Services Act 1986 (Investment Advertisements)
(Exemptions) Order 1996 of the United Kingdom or is a person to whom the
document may otherwise lawfully be issued or passed on.
(4) Each Purchaser agrees that it will not offer, sell or deliver any of
the Securities in any jurisdiction outside the United States except under
circumstances that will result in compliance with the applicable laws thereof,
and that it will take at its own expense whatever action is required to permit
its purchase and resale of the Securities in such jurisdictions. Each Purchaser
understands that no action has been taken to permit a public offering in any
jurisdiction outside the United States where action would be required for such
purpose. Each Purchaser agrees not to cause any advertisement of the Securities
to be published in any newspaper or periodical or posted in any public place and
not to issue any circular relating to the Securities, except in any such case
with the express written consent of each of Goldman, Sachs & Co. and Morgan
Stanley & Co. Incorporated and then only at such Purchaser's own risk and
expense.
B-2
INDENTURE dated as of May 15, 2001 among Charter Communications
Holdings, LLC, a Delaware limited liability company (as further defined below,
the "Company"), Charter Communications Holdings Capital Corporation, a Delaware
corporation (as further defined below, "Charter Capital" and together with the
Company, the "Issuers"), and BNY Midwest Trust Company, as trustee (the
"Trustee").
The Issuers and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the Notes:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
-----------
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified Person,
whether or not such Indebtedness is incurred in connection with, or in
contemplation of, such other Person merging with or into, or becoming a
Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Additional Notes" means the Issuers' 9.625% Senior Notes due 2009
issued under this Indenture in addition to the Original Notes (other than any
Notes issued in respect of Original Notes pursuant to Section 2.06, 2.07, 2.10,
3.03, 4.16 or 9.05).
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling, "controlled by" and "under common control
with" shall have correlative meanings.
"Agent" means any Registrar or Paying Agent.
1
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of the Depositary, Euroclear and Clearstream, in each case to the
extent applicable to such transaction and as in effect from time to time.
"Asset Acquisition" means (a) an Investment by the Company or any of the
Company's Restricted Subsidiaries in any other Person pursuant to which such
Person shall become a Restricted Subsidiary of the Company or any of its
Restricted Subsidiaries or shall be merged with or into the Company or any of
the Company's Restricted Subsidiaries, or (b) the acquisition by the Company or
any of the Company's Restricted Subsidiaries of the assets of any Person which
constitute all or substantially all of the assets of such Person, any division
or line of business of such Person or any other properties or assets of such
Person other than in the ordinary course of business.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any assets or
rights, other than sales of inventory in the ordinary course of business
consistent with past practices; provided that the sale, conveyance or other
disposition of all or substantially all of the assets of the Company and its
Restricted Subsidiaries, taken as a whole, shall be governed by Section 4.16
and/or Section 5.01 and not by the provisions of Section 4.11; and
(2) the issuance of Equity Interests by any of the Company's Restricted
Subsidiaries or the sale of Equity Interests in any of the Company's Restricted
Subsidiaries.
Notwithstanding the preceding, the following items shall not be deemed
to be Asset Sales:
(1) any single transaction or series of related transactions that: (a)
involves assets having a fair market value of less than $100 million; or (b)
results in net proceeds to the Company and its Restricted Subsidiaries of less
than $100 million;
(2) a transfer of assets between or among the Company and its Restricted
Subsidiaries;
(3) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary of the Company to the Company or to another Wholly Owned Restricted
Subsidiary of the Company;
(4) a Restricted Payment that is permitted by Section 4.07 and a
Restricted Investment that is permitted by Section 4.08; and
2
(5) the incurrence of Permitted Liens and the disposition of assets
related to such Permitted Liens by the secured party pursuant to a foreclosure.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value of the obligation of the
lessee for net rental payments during the remaining term of the lease included
in such sale and leaseback transaction including any period for which such lease
has been extended or may, at the option of the lessee, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or
state law of any jurisdiction relating to bankruptcy, insolvency, winding up,
liquidation, reorganization or relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as such term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire, whether such
right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition.
"Board of Directors" means the Manager or the Board of Directors of the
Company or the Board of Directors of Charter Capital, as the case may be, or any
authorized committee of the Board of Directors of the Company or Charter
Capital, as the case may be.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company or Charter Capital, as the
case may be, to have been duly adopted by the Board of Directors of the Company
or Charter Capital, as the case may be, and to be in full force and effect on
the date of such certification and delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Cable Related Business" means the business of owning cable television
systems and businesses ancillary, complementary and related thereto.
"Capital Lease Obligation" means, at the time any determination thereof
is to be made, the amount of the liability in respect of a capital lease that
would at that time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means:
3
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest (other than any debt obligation) or participation
that confers on a Person the right to receive a share of the profits and losses
of, or distributions of assets of, the issuing Person.
"Capital Stock Sale Proceeds" means the aggregate net cash proceeds
(including the fair market value of the non-cash proceeds, as determined by an
independent appraisal firm) received by the Company since March 17, 1999 (x) as
a contribution to the common equity capital or from the issue or sale of Equity
Interests of the Company (other than Disqualified Stock) or (y) from the issue
or sale of convertible or exchangeable Disqualified Stock or convertible or
exchangeable debt securities of the Company that have been converted into or
exchanged for such Equity Interests (other than Equity Interests (or
Disqualified Stock or debt securities) sold to a Subsidiary of the Company).
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality thereof (provided that
the full faith and credit of the United States is pledged in support thereof)
having maturities of not more than twelve months from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with maturities
of twelve months or less from the date of acquisition, bankers' acceptances with
maturities not exceeding six months and overnight bank deposits, in each case,
with any domestic commercial bank having combined capital and surplus in excess
of $500 million and a Thompson Bank Watch Rating at the time of acquisition of
"B" or better;
(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications specified
in clause (3) above;
(5) commercial paper having a rating of at least "P-1" from Moody's or
at least "A-1" from S&P and in each case maturing within twelve months after the
date of acquisition;
4
(6) corporate debt obligations maturing within twelve months after the
date of acquisition thereof, rated at the time of acquisition at least "Aaa" or
"P-1" by Moody's or "AAA" or "A-1" by S&P;
(7) auction-rate preferred stocks of any corporation maturing not later
than 45 days after the date of acquisition thereof, rated at the time of
acquisition at least "Aaa" by Moody's or "AAA" by S&P;
(8) securities issued by any state, commonwealth or territory of the
United States, or by any political subdivision or taxing authority thereof,
maturing not later than six months after the date of acquisition thereof, rated
at the time of acquisition at least "A" by Moody's or S&P; and
(9) money market or mutual funds at least 90% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1) through (8) of
this definition.
"Change of Control" means the occurrence of any of the following:
(1) the sale, transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of the Company and its Subsidiaries,
taken as a whole, or of a Parent and its Subsidiaries, taken as a whole, to any
"person" (as such term is used in Section 13(d)(3) of the Exchange Act) other
than the Principal or a Related Party of the Principal;
(2) the adoption of a plan relating to the liquidation or dissolution of
the Company or a Parent;
(3) the consummation of any transaction (including, without limitation,
any merger or consolidation) the result of which is that any "person" (as
defined above), other than the Principal and Related Parties, becomes the
Beneficial Owner, directly or indirectly, of more than 35% of the Voting Stock
of the Company or a Parent, measured by voting power rather than the number of
shares, unless the Principal or a Related Party Beneficially Owns, directly or
indirectly, a greater percentage of Voting Stock of the Company or such Parent,
as the case may be, measured by voting power rather than the number of shares,
than such person;
(4) after the Issue Date, the first day on which a majority of the
members of the Board of Directors of the Company or the board of directors of a
Parent are not Continuing Directors; or
(5) the Company or a Parent consolidates with, or merges with or into,
any Person, or any Person consolidates with, or merges with or into, the Company
or a Parent, in any such event pursuant to a transaction in which any of the
outstanding Voting Stock of the Company or such Parent is converted into or
exchanged for cash, securities
5
or other property, other than any such transaction where the Voting Stock of the
Company or such Parent outstanding immediately prior to such transaction is
converted into or exchanged for Voting Stock (other than Disqualified Stock) of
the surviving or transferee Person constituting a majority of the outstanding
shares of such Voting Stock of such surviving or transferee Person immediately
after giving effect to such issuance.
"Charter Capital" means Charter Communications Holdings Capital
Corporation, a Delaware corporation, and any successor in interest thereto.
"Clearstream" means Clearstream Banking, societe anonyme (formerly
Cedelbank).
"Commission" or "SEC" means the Securities and Exchange Commission.
"Company" means Charter Communications Holdings, LLC, a Delaware limited
liability company, and any successor in interest thereto.
"Consolidated EBITDA" means with respect to any Person, for any period,
the net income of such Person and its Restricted Subsidiaries for such period
plus, to the extent such amount was deducted in calculating such net income:
(1) Consolidated Interest Expense;
(2) income taxes;
(3) depreciation expense;
(4) amortization expense;
(5) all other non-cash items, extraordinary items, nonrecurring and
unusual items and the cumulative effects of changes in accounting principles
reducing such net income, less all non-cash items, extraordinary items,
nonrecurring and unusual items and cumulative effects of changes in accounting
principles increasing such net income, all as determined on a consolidated basis
for such Person and its Restricted Subsidiaries in conformity with GAAP;
(6) amounts actually paid during such period pursuant to a deferred
compensation plan; and
(7) for purposes of Section 4.10 only, Management Fees;
provided that Consolidated EBITDA shall not include:
6
(x) the net income (or net loss) of any Person that is not a Restricted
Subsidiary ("Other Person"), except (i) with respect to net income, to the
extent of the amount of dividends or other distributions actually paid to such
Person or any of its Restricted Subsidiaries by such Other Person during such
period and (ii) with respect to net losses, to the extent of the amount of
investments made by such Person or any Restricted Subsidiary of such Person in
such Other Person during such period;
(y) solely for the purposes of calculating the amount of Restricted
Payments that may be made pursuant to clause (3) of Section 4.07 (and in such
case, except to the extent includable pursuant to clause (x) above), the net
income (or net loss) of any Other Person accrued prior to the date it becomes a
Restricted Subsidiary or is merged into or consolidated with such Person or any
Restricted Subsidiaries or all or substantially all of the property and assets
of such Other Person are acquired by such Person or any of its Restricted
Subsidiaries; and
(z) the net income of any Restricted Subsidiary of the Company to the
extent that the declaration or payment of dividends or similar distributions by
such Restricted Subsidiary of such net income is not at the time permitted by
the operation of the terms of such Restricted Subsidiary's charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Restricted Subsidiary (other than any agreement or
instrument evidencing Indebtedness or Preferred Stock (i) outstanding on the
Issue Date, or (ii) incurred or issued thereafter in compliance with Section
4.10, provided that (a) the terms of any such agreement or instrument
restricting the declaration and payment of dividends or similar distributions
apply only in the event of a default with respect to a financial covenant or a
covenant relating to payment (beyond any applicable period of grace) contained
in such agreement or instrument, (b) such terms are determined by such Person to
be customary in comparable financings and (c) such restrictions are determined
by the Company not to materially affect the Issuers' ability to make principal
or interest payments on the Notes when due).
"Consolidated Indebtedness" means, with respect to any Person as of any
date of determination, the sum, without duplication, of:
(1) the total amount of outstanding Indebtedness of such Person and its
Restricted Subsidiaries, plus
(2) the total amount of Indebtedness of any other Person that has been
Guaranteed by the referent Person or one or more of its Restricted Subsidiaries,
plus
(3) the aggregate liquidation value of all Disqualified Stock of such
Person and all Preferred Stock of Restricted Subsidiaries of such Person, in
each case, determined on a consolidated basis in accordance with GAAP.
7
"Consolidated Interest Expense" means, with respect to any Person for
any period, without duplication, the sum of
(1) the consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued (including, without
limitation, amortization or original issue discount, non-cash interest payments,
the interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Hedging Obligations); and
(2) the consolidated interest expense of such Person and its Restricted
Subsidiaries that was capitalized during such period; and
(3) any interest expense on Indebtedness of another Person that is
guaranteed by such Person or one of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or one of its Restricted Subsidiaries (whether or
not such Guarantee or Lien is called upon);
excluding, however, any amount of such interest of any Restricted Subsidiary of
the referent Person if the net income of such Restricted Subsidiary is excluded
in the calculation of Consolidated EBITDA pursuant to clause (z) of the
definition thereof (but only in the same proportion as the net income of such
Restricted Subsidiary is excluded from the calculation of Consolidated EBITDA
pursuant to clause (z) of the definition thereof), in each case, on a
consolidated basis and in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company or the board of directors of a
Parent who:
(1) was a member of such board of directors on the Issue Date; or
(2) was nominated for election or elected to such board of directors
with the approval of a majority of the Continuing Directors who were members of
such board of directors at the time of such nomination or election or whose
election or appointment was previously so approved.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 10.02 or such other address as to which the Trustee
may give notice to the Issuers.
"Credit Facilities" means, with respect to the Company and/or its
Restricted Subsidiaries, one or more debt facilities or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to
8
special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06, substantially in
the form of Exhibit A hereto, except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Global Notes, the Person
specified in Section 2.03 as the Depositary with respect to the Notes, and any
and all successors thereto appointed as depositary hereunder and having become
such pursuant to the applicable provision of this Indenture.
"Disposition" means, with respect to any Person, any merger,
consolidation or other business combination involving such Person (whether or
not such Person is the surviving Person) or the sale, assignment, or transfer,
lease conveyance or other disposition of all or substantially all of such
Person's assets or Capital Stock.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the Notes mature. Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase such Capital
Stock upon the occurrence of a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock provide that
the Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.07.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means any private or underwritten public offering of
Qualified Capital Stock of the Company or a Parent of which the gross proceeds
(x) to the Company or (y) received by the Company as a capital contribution from
such Parent, as the case may be, are at least $25 million.
9
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Issuers' 9.625% Senior Notes due 2009,
containing terms substantially identical to the Initial Notes or any Initial
Additional Notes (except that (i) such Exchange Notes shall not contain terms
with respect to transfer restrictions and shall be registered under the
Securities Act and (ii) certain provisions relating to an increase in the stated
rate of interest thereon shall be eliminated), that are issued and exchanged for
(a) the Initial Notes, as provided for in the Registration Rights Agreement
relating to such Initial Notes and this Indenture or (b) such Initial Additional
Notes, as may be provided in any Registration Rights Agreement relating to such
Initial Additional Notes and this Indenture (including any amendment or
supplement thereto).
"Exchange Offer" means an offer to exchange Initial Notes or Initial
Additional Notes, if any, for Exchange Notes pursuant to a Registration Rights
Agreement.
"Exchange Offer Registration Statement" means a registration statement
relating to an Exchange Offer as may be provided in any Registration Rights
Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries in existence on the Issue Date, until such amounts are
repaid.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the Issue Date.
"Global Note Legend" means the legend set forth in Section 2.06(g)(ii),
which is required to be placed on all Global Notes issued under this Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" or "guarantee" means a guarantee other than by endorsement
of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a
pledge of assets or through
10
letters of credit or reimbursement agreements in respect thereof, of all or any
part of any Indebtedness, measured as the lesser of the aggregate outstanding
amount of the Indebtedness so guaranteed and the face amount of the guarantee.
"Hedging Obligations" means, with respect to any Person, the obligations
of such Person under:
(1) interest rate swap agreements, interest rate cap agreements and
interest rate collar agreements;
(2) interest rate option agreements, foreign currency exchange
agreements, foreign currency swap agreements; and
(3) other agreements or arrangements designed to protect such Person
against fluctuations in interest and currency exchange rates.
"Helicon Preferred Stock" means the preferred limited liability company
interest of Charter-Helicon LLC with an aggregate liquidation value of $25
million outstanding on the Issue Date.
"Holder" means a holder of the Notes.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
(5) in respect of the balance deferred and unpaid of the purchase price
of any property, except any such balance that constitutes an accrued expense or
trade payable; or
(6) representing the notional amount of any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not
11
otherwise included, the Guarantee by such Person of any indebtedness of any
other Person.
The amount of any Indebtedness outstanding as of any date shall be:
(1) the accreted value thereof, in the case of any Indebtedness issued
with original issue discount; and
(2) the principal amount thereof, together with any interest thereon
that is more than 30 days past due, in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest in
a Global Note through a Participant.
"Initial Additional Notes" means Additional Notes issued in an offering
not registered under the Securities Act.
"Initial Notes" means the Issuers' 9.625% Senior Notes due 2009, issued
on the Issue Date (and any Notes issued in respect thereof pursuant to Section
2.06, 2.07, 2.10, 3.03, 4.16 or 9.05).
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act that is not also a QIB.
"Investment Grade Rating" means a rating equal to or higher than Baa3
(or the equivalent) by Moody's and BBB- (or the equivalent) by S&P.
"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business) and
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
"Issue Date" means May 15, 2001.
"Issuers" has the meaning assigned to it in the preamble to this
Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in The City of New York or at a place of payment are authorized by
law,
12
regulation or executive order to remain closed. If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue on such
payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Issuers and sent to all Holders of the Initial Notes or any Initial
Additional Notes for use by such Holders in connection with any Exchange Offer.
"Leverage Ratio" means, as of any date, the ratio of:
(1) the Consolidated Indebtedness of the Company on such date to
(2) the aggregate amount of Consolidated EBITDA for the Company for the
most recently ended fiscal quarter for which internal financial statements are
available multiplied by four (the "Reference Period").
In addition to the foregoing, for purposes of this definition,
"Consolidated EBITDA" shall be calculated on a pro forma basis after giving
effect to
(1) the issuance of the Notes;
(2) the incurrence of the Indebtedness or the issuance of the
Disqualified Stock or other Preferred Stock of a Restricted Subsidiary (and the
application of the proceeds therefrom) giving rise to the need to make such
calculation and any incurrence or issuance (and the application of the proceeds
therefrom) or repayment of other Indebtedness or Disqualified Stock or other
Preferred Stock of a Restricted Subsidiary, other than the incurrence or
repayment of Indebtedness for ordinary working capital purposes, at any time
subsequent to the beginning of the Reference Period and on or prior to the date
of determination, as if such incurrence (and the application of the proceeds
thereof), or the repayment, as the case may be, occurred on the first day of the
Reference Period; and
(3) any Dispositions or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of such Person or one of its Restricted Subsidiaries
(including any person that becomes a Restricted Subsidiary as a result of such
Asset Acquisition) incurring, assuming or otherwise becoming liable for or
issuing Indebtedness, Disqualified Stock or Preferred Stock) made on or
subsequent to the first day of the Reference Period and on or prior to the date
of determination, as if such Disposition or Asset Acquisition (including the
incurrence, assumption or liability for any such Indebtedness, Disqualified
Stock or Preferred Stock and also including any Consolidated EBITDA associated
with such Asset Acquisition, including any cost savings adjustments in
compliance with Regulation S-X promulgated by the Commission) had occurred on
the first day of the Reference Period.
13
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Management Fees" means the fees payable to Charter Communications, Inc.
pursuant to the management agreements between Charter Communications, Inc. and
Charter Communications Operating, LLC and between Charter Communications, Inc.
and Restricted Subsidiaries of the Company and pursuant to the limited liability
company agreements of certain Restricted Subsidiaries as such management or
limited liability company agreements exist on the Issue Date (or, if later, on
the date any new Restricted Subsidiary is acquired or created), including any
amendment or replacement thereof, provided that any such amendment or
replacement is not more disadvantageous to the Holders of the Notes in any
material respect from such management or limited liability company agreements
existing on the Issue Date.
"Manager" means Charter Communications, Inc., in its capacity as manager
of the Company under the Company's limited liability company agreement, dated as
of February 9, 1999, as amended from time to time, and any successor manager
appointed pursuant to such limited liability company agreement.
"Moody's" means Moody's Investors Service, Inc. or any successor to the
rating agency business thereof.
"Net Proceeds" means the aggregate cash proceeds received by the Company
or any of its Restricted Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale, including, without limitation, legal, accounting
and investment banking fees, and sales commissions, and any relocation expenses
incurred as a result thereof or taxes paid or payable as a result thereof
(including amounts distributable in respect of owners', partners' or members'
tax liabilities resulting from such sale), in each case after taking into
account any available tax credits or deductions and any tax sharing arrangements
and amounts required to be applied to the repayment of Indebtedness.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any undertaking,
agreement or
14
instrument that would constitute Indebtedness), (b) is directly or indirectly
liable as a guarantor or otherwise, or (c) constitutes the lender;
(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any
other Indebtedness (other than the Notes) of the Company or any of its
Restricted Subsidiaries to declare a default on such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its stated maturity;
and
(3) as to which the lenders have been notified in writing that they will
not have any recourse to the Capital Stock or assets of the Company or any of
its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note" or "Notes" means the Initial Notes, any Additional Notes and the
Exchange Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company or Charter Capital, as the case may be, by two Officers of the Company
or Charter Capital, as the case may be, one of whom must be the principal
executive officer, the chief financial officer or the treasurer of the Company
or Charter Capital, as the case may be, that meets the requirements of Section
10.05.
"Opinion of Counsel" means an opinion from legal counsel that meets the
requirements of Section 10.05. The counsel may be an employee of or counsel to
the Issuers or any Subsidiary of the Issuers.
"Original Notes" means the Initial Notes and any Exchange Notes issued
in exchange therefor.
"Other Notes" means the 10.000% Senior Notes due 2011 of the Issuers in
an aggregate principal amount not to exceed the principal amount issued on the
Issue Date,
15
and the 11.750% Senior Discount Notes due 2011 of the Issuers in an
aggregate principal amount not to exceed the principal amount issued on the
Issue Date.
"Parent" means Charter Communications, Inc. and/or Charter
Communications Holding Company, LLC, as applicable, and any successor Person or
any Person succeeding to the direct or indirect ownership of the Company.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Investments" means:
(1) any Investment by the Company in a Restricted Subsidiary of the
Company, or any Investment by a Restricted Subsidiary of the Company in the
Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary of the
Company in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of the Company; or
(b) such Person is merged, consolidated or amalgamated with or into,
or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Restricted Subsidiary of the Company;
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 4.11;
(5) any Investment made out of the net cash proceeds of the issue and
sale since March 17, 1999 (other than to a Subsidiary of the Company) of Equity
Interests (other than Disqualified Stock) of the Company to the extent that (a)
such net cash proceeds have not been applied to make a Restricted Payment or to
effect other transactions pursuant to Section 4.07 or (b) such net cash proceeds
have not been used to incur Indebtedness pursuant to clause (10) of Section
4.10;
(6) Investments in Productive Assets having an aggregate fair market
value (measured on the date each such Investment was made and without giving
effect to subsequent changes in value), when taken together with all other
Investments in Productive Assets made by the Company and its Restricted
Subsidiaries pursuant to this clause (6) since March 17, 1999, not to exceed
$150 million; provided that either the Company or any of its Restricted
Subsidiaries, after giving effect to such Investments,
16
will own at least 20% of the Voting Stock of any Person in which any such
Investment is made;
(7) other Investments in any Person having an aggregate fair market
value (measured on the date each such Investment was made and without giving
effect to subsequent changes in value), when taken together with all other
Investments in any Person made by the Company and its Restricted Subsidiaries
pursuant to this clause (7) since March 17, 1999, not to exceed $50 million; and
(8) Investments in customers and suppliers in the ordinary course of
business which either (A) generate accounts receivable or (B) are accepted in
settlement of bona fide disputes.
"Permitted Liens" means:
(1) Liens on the assets of the Company securing Indebtedness and other
Obligations under clause (1) of Section 4.10;
(2) Liens in favor of the Company;
(3) Liens on property of a Person existing at the time such Person is
merged with or into or consolidated with the Company; provided that such Liens
were in existence prior to the contemplation of such merger or consolidation and
do not extend to any assets other than those of the Person merged into or
consolidated with the Company;
(4) Liens on property existing at the time of acquisition thereof by the
Company; provided that such Liens were in existence prior to the contemplation
of such acquisition;
(5) Liens to secure the performance of statutory obligations, surety or
appeal bonds, performance bonds or other obligations of a like nature incurred
in the ordinary course of business;
(6) purchase money mortgages or other purchase money liens (including
without limitation any Capital Lease Obligations) incurred by the Company upon
any fixed or capital assets acquired after the Issue Date or purchase money
mortgages (including without limitation Capital Lease Obligations) on any such
assets, whether or not assumed, existing at the time of acquisition of such
assets, whether or not assumed, so long as (i) such mortgage or lien does not
extend to or cover any of the assets of the Company, except the asset so
developed, constructed, or acquired, and directly related assets such as
enhancements and modifications thereto, substitutions, replacements, proceeds
(including insurance proceeds), products, rents and profits thereof, and (ii)
such mortgage or lien secures the obligation to pay the purchase price of such
asset, interest thereon and other charges, costs and expenses (including,
without limitation, the cost of design, development, construction, acquisition,
transportation, installation, improvement,
17
and migration) and is incurred in connection therewith (or the obligation under
such Capital Lease Obligation) only;
(7) Liens existing on the Issue Date (other than in connection with the
Credit Facilities);
(8) Liens for taxes, assessments or governmental charges or claims that
are not yet delinquent or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded; provided that any
reserve or other appropriate provision as shall be required in conformity with
GAAP shall have been made therefor;
(9) statutory and common law Liens of landlords and carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other similar
Liens arising in the ordinary course of business and with respect to amounts not
yet delinquent or being contested in good faith by appropriate legal proceedings
promptly instituted and diligently conducted and for which a reserve or other
appropriate provision, if any, as shall be required in conformity with GAAP
shall have been made;
(10) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security;
(11) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligation, bankers' acceptance,
surety and appeal bonds, government contracts, performance and return-of-money
bonds and other obligations of a similar nature incurred in the ordinary course
of business (exclusive of obligations for the payment of borrowed money);
(12) easements, rights-of-way, municipal and zoning ordinances and
similar charges, encumbrances, title defects or other irregularities that do not
materially interfere with the ordinary course of business of the Company or any
of its Restricted Subsidiaries;
(13) Liens of franchisors or other regulatory bodies arising in the
ordinary course of business;
(14) Liens arising from filing Uniform Commercial Code financing
statements regarding leases or other Uniform Commercial Code financing
statements for precautionary purposes relating to arrangements not constituting
Indebtedness;
(15) Liens arising from the rendering of a final judgment or order
against the Company or any of its Restricted Subsidiaries that does not give
rise to an Event of Default;
18
(16) Liens securing reimbursement obligations with respect to letters of
credit that encumber documents and other property relating to such letters of
credit and the products and proceeds thereof;
(17) Liens encumbering customary initial deposits and margin deposits,
and other Liens that are within the general parameters customary in the industry
and incurred in the ordinary course of business, in each case, securing
Indebtedness under Hedging Obligations and forward contracts, options, future
contracts, future options or similar agreements or arrangements designed solely
to protect the Company or any of its Restricted Subsidiaries from fluctuations
in interest rates, currencies or the price of commodities;
(18) Liens consisting of any interest or title of licensor in the
property subject to a license;
(19) Liens on the Capital Stock of Unrestricted Subsidiaries;
(20) Liens arising from sales or other transfers of accounts receivable
which are past due or otherwise doubtful of collection in the ordinary course of
business;
(21) Liens incurred in the ordinary course of business of the Company
with respect to obligations which in the aggregate do not exceed $50 million at
any one time outstanding;
(22) Liens in favor of the Trustee arising under the provisions in this
Indenture and in the indentures relating to the Other Notes, in each case under
Section 7.07; and
(23) Liens in favor of the Trustee for its benefit and the benefit of
Holders and the holders of the Other Notes, as their respective interests
appear.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund, other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that unless permitted otherwise
by this Indenture, no Indebtedness of the Company or any of its Restricted
Subsidiaries, may be issued in exchange for, nor may the net proceeds of
Indebtedness be used to extend, refinance, renew, replace, defease or refund,
Indebtedness of the Company or any of its Restricted Subsidiaries; provided,
further, that:
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount of (or
accreted value, if applicable), plus accrued interest and premium, if any, on
the Indebtedness so extended,
19
refinanced, renewed, replaced, defeased or refunded (plus the amount of
reasonable expenses incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the Notes, such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the Notes on
terms at least as favorable to the Holders of Notes as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company or by any of its
Restricted Subsidiaries who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"Preferred Stock," as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which by its terms is
preferred in right of payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.
"Principal" means Paul G. Allen.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i)(A) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"Productive Assets" means assets (including assets of a referent Person
owned directly or indirectly through ownership of Capital Stock) of a kind used
or useful in the Cable Related Business.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Stock.
"Rating Agencies" means Moody's and S&P.
20
"Registration Rights Agreement" means (a) the Exchange and Registration
Rights Agreement dated as of the Issue Date among the Issuers and the initial
purchasers named therein with respect to the Initial Notes and (b) any
registration rights agreement among the Issuers and the initial purchasers named
therein with respect to any Initial Additional Notes.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a global note substantially in the form
of Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in an initial denomination equal
to the outstanding principal amount of the Initial Notes or any Initial
Additional Notes, in each case, initially sold in reliance on Rule 903 of
Regulation S.
"Related Party" means:
(1) the spouse or an immediate family member, estate or heir of the
Principal; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially holding an
80% or more controlling interest of which consist of the Principal and/or such
other Persons referred to in the immediately preceding clause (1).
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
21
"Rule 144A Global Note" means a global note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in an initial denomination equal
to the outstanding principal amount of the Initial Notes or any Initial
Additional Notes, in each case initially sold in reliance on Rule 144A.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"S&P" means Standard & Poor's Ratings Service, a division of the
McGraw-Hill Companies, Inc. or any successor to the rating agency business
thereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" means a "shelf" registration statement
providing for the registration and the sale on a continuous or delayed basis of
the Initial Notes or any Initial Additional Notes as may be provided in any
Registration Rights Agreement.
"Significant Subsidiary" means any Restricted Subsidiary of the Company
which is a "Significant Subsidiary" as defined in Rule 1-02(w) of Regulation S-X
under the Exchange Act.
"Special Interest" means special or additional interest in respect of
the Notes that is payable by the Issuers as liquidated damages upon specified
registration defaults pursuant to any Registration Rights Agreement.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness on the Issue Date, or, if none, the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association or other business entity of which at
least 50% of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof) and, in the case of any such entity of
which 50% of the total voting power of shares of Capital Stock is so owned or
controlled by such Person or one or more of the other Subsidiaries of such
22
Person, such Person and its Subsidiaries also have the right to control the
management of such entity pursuant to contract or otherwise; and
(2) any partnership (a) the sole general partner or the managing general
partner of which is such Person or a Subsidiary of such Person or (b) the only
general partners of which are such Person or of one or more Subsidiaries of such
Person (or any combination thereof).
"Tax" shall mean any tax, duty, levy, impost, assessment or other
governmental charge (including penalties, interest and any other liabilities
related thereto).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA; provided, however, that in the event the Trust Indenture Act of
1939 is amended after such date, then "TIA" means, to the extent required by
such amendment, the Trust Indenture Act of 1939 as so amended.
"Trustee" means BNY Midwest Trust Company until a successor replaces BNY
Midwest Trust Company in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global note substantially
in the form of Exhibit A attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that such
Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the Company
unless the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than those
that might be obtained at the time from Persons who are not Affiliates of the
Company unless such terms constitute Investments permitted under Section 4.08;
23
(3) is a Person with respect to which neither the Company nor any of its
Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe
for additional Equity Interests or (b) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results;
(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of the Company or any of its Restricted
Subsidiaries; and
(5) has at least one director on its board of directors that is not a
director or executive officer of the Company or any of its Restricted
Subsidiaries, or has at least one executive officer that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries.
"U.S. Person" means a U.S. person as defined in Rule 902(k) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the board of
directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount of
each then remaining installment, sinking fund, serial maturity or other required
payments of principal, including payment at final maturity, in respect thereof,
by (b) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person and/or by one or more Wholly Owned Restricted
Subsidiaries of such Person.
24
Section 1.02. Other Definitions.
-----------------
Defined in
Term Section
- ---- -----------
"Affiliate Transaction".............................. 4.13
"Asset Sale Offer"................................... 3.03
"Authentication Order"............................... 2.02
"Change of Control Offer"............................ 4.16
"Change of Control Payment".......................... 4.16
"Change of Control Payment Date"..................... 4.16
"Covenant Defeasance"................................ 8.03
"DTC"................................................ 2.03
"Event of Default"................................... 6.01
"Excess Proceeds".................................... 4.11
"incur".............................................. 4.10
"Legal Defeasance"................................... 8.02
"Offer Amount"....................................... 3.03
"Offer Period"....................................... 3.03
"Paying Agent"....................................... 2.03
"Payment Default".................................... 6.01
"Permitted Debt".................................... 4.10
"Preferred Stock Financing".......................... 4.10
"Purchase Date"...................................... 3.03
"Registrar".......................................... 2.03
"Restricted Payments"................................ 4.07
"Subordinated Debt Financing"........................ 4.10
"Subordinated Notes"................................. 4.10
"Subsidiary Guarantee"............................... 4.17
"Suspended Covenants"................................ 4.19
Section 1.03. Incorporation by Reference of Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
25
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Issuers and any successor obligor upon
the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.04. Rules of Construction.
---------------------
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural include
the singular;
(e) provisions apply to successive events and transactions;
(f) references to sections of or rules under the Securities Act shall be
deemed to include substitute, replacement of successor sections or rules adopted
by the SEC from time to time;
(g) references to any statute, law, rule or regulation shall be deemed
to refer to the same as from time to time amended and in effect and to any
successor statute, law, rule or regulation; and
(h) references to any contract, agreement or instrument shall mean the
same as amended, modified, supplemented or amended and restated from time to
time, in each case, in accordance with any applicable restrictions contained in
this Indenture.
26
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating.
---------------
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Issuers and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially in
the form of Exhibit A attached hereto (including the Global Note Legend thereon
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the
custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06.
(c) Euroclear and Clearstream Procedures Applicable. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream (or, in each case,
equivalent documents setting forth the procedures of Euroclear and Clearstream)
shall be applicable to transfers of beneficial interests in the Regulation S
Global Notes that are held by Participants through Euroclear or Clearstream.
27
Section 2.02. Execution and Authentication.
----------------------------
Two Officers shall sign the Notes for each Issuer by manual or facsimile
signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
(which may be by facsimile) of the Trustee. The signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
At any time and from time to time after the execution and delivery of
this Indenture, the Issuers may deliver Notes executed by the Issuers to the
Trustee for authentication; and the Trustee shall authenticate and deliver (i)
Initial Notes for original issue in the aggregate principal amount of
$350,000,000, (ii) Additional Notes from time to time for original issue in
aggregate principal amount specified by the Issuers and (iii) Exchange Notes
from time to time for issue in exchange for a like principal amount of Initial
Notes or Initial Additional Notes, in each case specified in clauses (i) through
(iii) above, upon a written order of the Issuers signed by an Officer of each of
the Issuers (an "Authentication Order"). Such Authentication Order shall specify
the amount of Notes to be authenticated and the date on which the Notes are to
be authenticated, whether such notes are to be Initial Notes, Additional Notes
or Exchange Notes and whether the Notes are to be issued as one or more Global
Notes and such other information as the Issuers may include or the Trustee may
reasonably request. The aggregate principal amount of Notes which may be
authenticated and delivered under this Indenture is unlimited.
On the Issue Date, the Issuers will issue $350,000,000 aggregate
principal amount of Initial Notes. Initial Notes and any Initial Additional
Notes offered and sold in reliance on the exemption from registration under the
Securities Act provided by Section 4(2) thereunder or Rule 144A shall be issued
as one or more Rule 144A Global Notes. Initial Notes and any Initial Additional
Notes offered and sold in offshore transactions in reliance on Regulation S
shall be issued as one or more Regulation S Global Notes.
The Trustee may appoint an authenticating agent acceptable to the
Issuers to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Issuers.
28
Section 2.03. Registrar and Paying Agent.
--------------------------
The Issuers shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Issuers may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Issuers may change any
Paying Agent or Registrar without notice to any Holder. The Issuers shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Issuers fail to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Issuers or any of
their Subsidiaries may act as Paying Agent or Registrar.
The Issuers initially appoint The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Issuers initially appoint the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
-----------------------------------
The Issuers shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Issuers in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Issuers at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Issuers or a Subsidiary) shall have no further
liability for the money. If the Issuers or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Issuers, the Trustee shall serve as Paying Agent for
the Notes.
Section 2.05. Holder Lists.
------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Issuers shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of
29
such date as the Trustee may reasonably require of the names and addresses of
the Holders of Notes and the Issuers shall otherwise comply with TIA ss. 312(a).
Section 2.06. Transfer and Exchange.
---------------------
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes shall be exchanged
by the Company for Definitive Notes if:
(i) the Issuers deliver to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that
it is no longer a clearing agency registered under the Exchange Act and,
in either case, a successor Depositary is not appointed by the Issuers
within 120 days after the date of such notice from the Depositary; or
(ii)the Issuers in their sole discretion determine that the Global
Notes (in whole but not in part) should be exchanged for Definitive
Notes and deliver a written notice to such effect to the Trustee; or
(iii) there shall have occurred and be continuing a Default or Event
of Default with respect to the Notes.
Upon the occurrence of any of the preceding events in (i), (ii) or (iii)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10, shall be authenticated
and delivered in the form of, and shall be, a Global Note. A Global Note may not
be exchanged for another Note other than as provided in this Section 2.06(a);
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.06(b), (c) or (f).
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth herein to the extent required by the Securities Act. Prior to the
expiration of the 40-day distribution compliance period set forth in Regulation
S, beneficial interests in any Regulation S Global Notes may be held only
through Euroclear or Clearstream unless transferred in accordance with
30
Section 2.06(b)(iii)(A). Transfers of beneficial interests in the Global Notes
also shall require compliance with either subparagraph (i) or (ii) below, as
applicable, as well as one or more of the other following subparagraphs, as
applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest
in the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend. Beneficial
interests in any Unrestricted Global Note may be transferred to Persons
who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall be
required to be delivered to the Registrar to effect the transfers
described in this Section 2.06(b)(i).
(ii)All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above,
the transferor of such beneficial interest must deliver to the Registrar
either:
(A)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited
a beneficial interest in another Global Note in an amount equal to
the beneficial interest to be transferred or exchanged; and
(A)(2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account
to be credited with such increase; or
(B)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to cause to be issued a
Definitive Note in an amount equal to the beneficial interest to be
transferred or exchanged; and
(B)(2) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above.
Upon consummation of an Exchange Offer by the Issuers in accordance with
Section 2.06(f), the requirements of this Section 2.06(b)(ii) shall be
deemed to have been satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal delivered by the
holder of such beneficial interests in the Restricted Global Notes. Upon
satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in this Indenture and the
Notes or
31
otherwise applicable under the Securities Act, the Trustee shall adjust
the principal amount of the relevant Global Note(s) pursuant to Section
2.06(h).
(iii) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the Rule 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto, including
the certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof.
(iv)Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in an Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global
Note or transferred to a Person who takes delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note if the exchange
or transfer complies with the requirements of Section 2.06(b)(ii) above
and:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement and
the holder of the beneficial interest to be transferred, in the case
of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not (1)
a broker-dealer, (2) a Person participating in the distribution of
the relevant Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth in
Regulation S and the Registrar receives the following:
32
(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
beneficial interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person
who shall take delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note, a certificate from such holder in the
form of Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to the
effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued,
the Issuers shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of a Restricted Definitive
Note, then, upon receipt by the Registrar of the following
documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item (2)(a)
thereof (provided that any such beneficial interest in Regulation S
Global Note shall not be so exchangeable until after the expiration
of the 40-day distribution compliance period set forth in Regulation
S);
33
(B) if such beneficial interest is being transferred to a QIB
in accordance with Rule 144A under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(2) thereof;
(D) if such beneficial interest is being transferred pursuant
to an exemption from the registration requirements of the Securities
Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from
the registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)(d) thereof,
if applicable;
(F) if such beneficial interest is being transferred to the
Issuers or any of their Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such beneficial interest is being transferred pursuant
to an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h), and the
Issuers shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend
and shall be subject to all restrictions on transfer contained therein.
34
(ii)Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted
Global Note may exchange such beneficial interest for an Unrestricted
Definitive Note or may transfer such beneficial interest to a Person who
takes delivery thereof in the form of an Unrestricted Definitive Note
only if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement and
the holder of such beneficial interest, in the case of an exchange,
or the transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a broker-dealer,
(2) a Person participating in the distribution of the relevant
Exchange Notes or (3) a Person who is an affiliate (as defined in
Rule 144) of the Issuers;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth in
Regulation S and the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form
of Exhibit C hereto, including the certifications in item
(1)(b) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form
of Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the Registrar
so requests or if the Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Registrar to the effect that
such exchange or transfer is in compliance with the Securities Act and that
the restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act.
35
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest in
an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive Note,
then, upon satisfaction of the conditions set forth in Section
2.06(b)(ii), the Trustee shall cause the aggregate principal amount of
the applicable Global Note to be reduced accordingly pursuant to Section
2.06(h), and the Issuers shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest pursuant to this Section
2.06(c)(iii) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions
from the Depositary and the Participant or Indirect Participant. The
Trustee shall deliver such Definitive Notes to the Persons in whose
names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iii)
shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests
in Global Notes.
(i) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note
or to transfer such Restricted Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following
documentation:
(A) if the Holder of such Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted
Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred
to a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred
to a Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the certifications in
item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an
36
exemption from the registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred
to an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than
those listed in subparagraphs (B) through (D) above, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item
(3) thereof, if applicable;
(F) if such Restricted Definitive Note is being transferred
to the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the certifications in
item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause
to be increased the aggregate principal amount of, in the case of clause (A)
above, the appropriate Restricted Global Note, in the case of clause (B)
above, the Rule 144A Global Note, in the case of clause (C) above, the
Regulation S Global Note.
(ii)Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note only if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement and
the Holder, in the case of an exchange, or the transferee, in the
case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the relevant Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
37
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth in
Regulation S and the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit B hereto, including the certifications in
item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to the
effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note at any time. Upon receipt of a request for such an exchange
or transfer, the Trustee shall cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the aggregate
principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B),
(ii)(D) or (iii) above at a time when an Unrestricted Global Note has
not yet been issued, the Issuers shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of Definitive Notes so
transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon
request by a Holder of Definitive Notes and such Holder's compliance with the
38
provisions of this Section 2.06(e), the Registrar shall register the transfer or
exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder shall present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the
name of Persons who take delivery thereof in the form of a Restricted
Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in item
(1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications, certificates and Opinion of
Counsel required by item (3) thereof, if applicable.
(ii)Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who
take delivery thereof in the form of an Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement and
the Holder, in the case of an exchange, or the transferee, in the
case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the relevant Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Issuers;
(B) any such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) any such transfer is effected by a broker-dealer pursuant
to an Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
39
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth in
Regulation S and the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item
(1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Issuers to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes.
A Holder of Unrestricted Definitive Notes may transfer such Notes to a
Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Definitive Notes pursuant
to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of an Exchange Offer in
accordance with a Registration Rights Agreement, the Issuers shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the relevant
Exchange Notes and (z) they are not affiliates (as defined in Rule 144) of the
Issuers, and accepted for exchange in the relevant Exchange Offer and (ii)
Definitive Notes in an aggregate principal amount equal to the principal amount
of the Restricted Definitive Notes accepted for exchange in the relevant
Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall
cause the aggregate principal amount of the applicable Restricted Global Notes
to be reduced accordingly, and the Issuers shall execute and the Trustee shall
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Definitive Notes in the appropriate principal amount.
40
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING
WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(3) TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE CERTIFICATION AND DELIVERY REQUIREMENTS OF THE INDENTURE
GOVERNING THE NOTES, (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section
2.06 (and all Notes issued in exchange therefor or substitution
thereof) shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN
41
CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE
TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN
WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION
PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY
BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE ISSUERS."
(h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11. At any
time prior to such cancellation, if any beneficial interest in a Global Note is
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note or for Definitive Notes,
the principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depositary at the direction of the Trustee to reflect such reduction;
and if the beneficial interest is being exchanged for or transferred to a Person
who will take delivery thereof in the form of a beneficial interest in another
Global Note, such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Issuers
shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon the Issuers' order or at the Registrar's request.
(ii)No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Issuers may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge payable upon exchange or
transfer pursuant to Sections 2.10, 3.03, 4.11, 4.16 and 9.05).
42
(iii) The Registrar shall not be required to register the transfer of
or exchange any Note selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part.
(iv)All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Issuers, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global
Notes or Definitive Notes surrendered upon such registration of transfer
or exchange.
(v) The Issuers shall not be required to register the transfer of or
to exchange a Note between a record date and the next succeeding
Interest Payment Date.
(vi)Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Issuers may deem and treat the
Person in whose name any Note is registered as the absolute owner of
such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the
Trustee, any Agent or the Issuers shall be affected by notice to the
contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06
to effect a registration of transfer or exchange may be submitted by
facsimile.
Section 2.07. Replacement Notes.
-----------------
If any mutilated Note is surrendered to the Trustee or the Issuers and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Issuers shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Issuers, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Issuers to protect the Issuers, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Issuers may charge for their expenses in replacing a Note.
Every replacement Note is an additional legally binding obligation of
the Issuers and shall be entitled to all of the benefits of this Indenture
equally and proportionately with all other Notes duly issued hereunder.
43
Section 2.08. Outstanding Notes.
-----------------
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions of this Indenture, and those described in this
Section as not outstanding. Except as set forth in Section 2.09, a Note does not
cease to be outstanding because either of the Issuers or an Affiliate of the
Issuers holds the Note.
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than an Issuer, a Subsidiary or an Affiliate
of any thereof) holds, on a redemption date or maturity date, money sufficient
to pay Notes payable on that date, then on and after that date such Notes shall
be deemed to be no longer outstanding and shall cease to accrue interest.
Section 2.09. Treasury Notes.
--------------
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by an
Issuer, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with an Issuer, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that a Responsible Officer of the Trustee knows are so owned shall be
so disregarded.
Section 2.10. Temporary Notes.
---------------
Until certificates representing Notes are ready for delivery, the
Issuers may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Issuers
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Issuers shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
44
Section 2.11. Cancellation.
------------
The Issuers at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
such canceled Notes in its customary manner. The Issuers may not issue new Notes
to replace Notes that they have paid or that have been delivered to the Trustee
for cancellation.
Section 2.12. Defaulted Interest.
------------------
If the Issuers default in a payment of interest on the Notes, they shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01. The Issuers shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment. The Issuers shall fix or cause to be fixed each such
special record date and payment date; provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Issuers (or, upon
the written request of the Issuers, the Trustee in the name and at the expense
of the Issuers) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Optional Redemption.
-------------------
The Notes will not be redeemable at the Issuers' option prior to
maturity.
Section 3.02. Mandatory Redemption.
--------------------
Except as otherwise provided in Section 4.11 or Section 4.16 below, the
Issuers shall not be required to make mandatory redemption payments with respect
to the Notes.
45
Section 3.03. Offer to Purchase by Application of Excess Proceeds.
---------------------------------------------------
In the event that the Issuers shall be required to commence an offer to
all Holders to purchase Notes pursuant to Section 4.11 (an "Asset Sale Offer"),
they shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Issuers shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.11 (the "Offer Amount") or, if less than the
Offer Amount has been tendered, all Notes tendered in response to the Asset Sale
Offer. Payment for any Notes so purchased shall be made in the same manner as
interest payments are made. Unless the Issuers default in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest after the Purchase Date.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no Special Interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer the Issuers shall send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section
3.03 and Section 4.11 and the length of time the Asset Sale Offer shall remain
open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue to
accrue interest;
(d) that, unless the Issuers default in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an Asset
Sale Offer or may elect to have Notes purchased in integral multiples of $1,000
only;
46
(f) that Holders electing to have a Note purchased pursuant to any Asset
Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Issuers, a depositary, if appointed by
the Issuers, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Issuers, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Issuers shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuers so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Issuers shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer or
if less than the Offer Amount has been tendered, all Notes tendered, and shall
deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Issuers in accordance with the
terms of this Section 3.03. The Issuers, the Depositary or the Paying Agent, as
the case may be, shall promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Notes tendered by such Holder and accepted by the
Issuers for purchase, and the Issuers shall promptly issue a new Note, and the
Trustee, upon written request from the Issuers, shall authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Issuers to the Holder thereof. The Issuers
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.
47
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
----------------
The Issuers shall pay or cause to be paid the principal, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Issuers or a Subsidiary thereof,
holds as of 10:00 a.m. New York City time on the due date money deposited by the
Issuers in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due. The Issuers shall pay all
Special Interest, if any, in the same manner on the dates and in the amounts set
forth in any Registration Rights Agreement.
The Issuers shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; they shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02. Maintenance of Office or Agency.
-------------------------------
The Issuers shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Issuers in respect of the Notes and this Indenture may be served. The
Issuers shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Issuers
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Issuers may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Issuers of their obligation to maintain an office or agency in the Borough of
Manhattan, The City of New York for such purposes. The Issuers shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
48
The Issuers hereby designate The Bank of New York, an affiliate of the
Trustee, at 101 Barclay Street, New York, New York 10286 as one such office or
agency of the Issuers in accordance with Section 2.03.
Section 4.03. Reports.
-------
Whether or not required by the Commission, so long as any Notes are
outstanding, the Issuers shall furnish to the Holders of Notes, within the time
periods specified in the Commission's rules and regulations:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q and 10-K
if the Issuers were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
section and, with respect to the annual information only, a report on the annual
financial statements by the Company's certified independent accountants; and
(2) all current reports that would be required to be filed with the
Commission on Form 8-K if the Issuers were required to file such reports.
If the Issuers have designated any of their Subsidiaries as Unrestricted
Subsidiaries, then the quarterly and annual financial information required by
the preceding paragraph shall include a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes thereto, and in
Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations of the Company
and its Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of the Company.
In addition, whether or not required by the Commission, the Issuers
shall file a copy of all of the information and reports referred to in clauses
(1) and (2) above with the Commission for public availability within the time
periods specified in the Commission's rules and regulations, unless the
Commission will not accept such a filing, and make such information available to
securities analysts and prospective investors upon request.
Section 4.04. Compliance Certificate.
----------------------
(a) The Company shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
have been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every
49
covenant contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions of this Indenture (or,
if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03 above shall be accompanied by a
written statement of the Company's independent public accountants (each of whom
shall be a firm of established national reputation) that in making the
examination necessary for certification of such financial statements, nothing
has come to their attention that would lead them to believe that the Company has
violated any provisions of Article 4 or Article 5 or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation. In the
event that, after the Company has used its reasonable best efforts to obtain the
written statement of the Company's independent public accountants required by
the provisions of this paragraph, such statement cannot be obtained, the Company
shall deliver, in satisfaction of its obligations under this Section 4.04, an
Officers' Certificate (A) certifying that it has used its reasonable best
efforts to obtain such required statement but was unable to do so and (B)
attaching the written statement of the Company's accountants that the Company
received in lieu thereof.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes.
-----
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
50
Section 4.06. Stay, Extension and Usury Laws.
------------------------------
Each of the Issuers covenants (to the extent that it may lawfully do so)
that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this Indenture; and each of the Issuers (to the
extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.
Section 4.07. Restricted Payments.
-------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted Subsidiaries'
Equity Interests (including, without limitation, any payment in connection with
any merger or consolidation involving the Company or any of its Restricted
Subsidiaries) or to the direct or indirect holders of the Company's or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other
than dividends or distributions payable (x) solely in Equity Interests (other
than Disqualified Stock) of the Company or (y) ,in the case of the Company and
its Restricted Subsidiaries, to the Company or a Restricted Subsidiary of the
Company);
(b) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the Company or any of its Restricted Subsidiaries) any Equity
Interests of the Company or any direct or indirect parent of the Company or any
Restricted Subsidiary of the Company (other than, in the case of the Company and
its Restricted Subsidiaries, any such Equity Interests owned by the Company or
any Restricted Subsidiary of the Company); or
(c) make any payment on or with respect to, or purchase, redeem, defease
or otherwise acquire or retire for value, any Indebtedness that is subordinated
to the Notes, except a payment of interest or principal at the Stated Maturity
thereof,
(all such payments and other actions set forth in clauses (a) through (c) above
being collectively referred to as "Restricted Payments"), unless, at the time of
and after giving effect to such Restricted Payment:
(1) no Default or Event of Default shall have occurred and be continuing
or would occur as a consequence thereof; and
51
(2) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable quarter period, have been permitted to incur at
least $1.00 of additional Indebtedness pursuant to the Leverage Ratio test set
forth in the first paragraph of Section 4.10; and
(3) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Company and each of its Restricted
Subsidiaries after March 17, 1999 (excluding Restricted Payments permitted by
clauses (2), (3), (4), (5), (6), (7) and (8) of the next succeeding paragraph),
shall not exceed, at the date of determination, the sum of:
(a) an amount equal to 100% of the Consolidated EBITDA of the Company
since March 17, 1999 to the end of the Company's most recently ended
full fiscal quarter for which internal financial statements are
available, taken as a single accounting period, less the product of 1.2
times the Consolidated Interest Expense of the Company since March 17,
1999 to the end of the Company's most recently ended full fiscal quarter
for which internal financial statements are available, taken as a single
accounting period, plus
(b) an amount equal to 100% of Capital Stock Sale Proceeds less any
such Capital Stock Sale Proceeds used in connection with (i) an
Investment made pursuant to clause (5) of the definition of "Permitted
Investments" or (ii) the incurrence of Indebtedness pursuant to clause
(10) of Section 4.10, plus
(c) $100 million.
So long as no Default has occurred and is continuing or would be caused
thereby, the preceding provisions shall not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would have
complied with the provisions of this Indenture;
(2) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness of the Company in exchange for, or
out of the net proceeds of, the substantially concurrent sale (other than to a
Subsidiary of the Company) of Equity Interests of the Company (other than
Disqualified Stock); provided that the amount of any such net cash proceeds that
are utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition shall be excluded from clause (3) (b) of the preceding
paragraph;
52
(3) the defeasance, redemption, repurchase or other acquisition of
subordinated Indebtedness of the Company or any of its Restricted Subsidiaries
with the net cash proceeds from an incurrence of Permitted Refinancing
Indebtedness;
(4) regardless of whether a Default then exists, the payment of any
dividend or distribution to the extent necessary to permit direct or indirect
beneficial owners of shares of Capital Stock of the Company to pay federal,
state or local income tax liabilities that would arise solely from income of the
Company or any of its Restricted Subsidiaries, as the case may be, for the
relevant taxable period and attributable to them solely as a result of the
Company (and any intermediate entity through which the holder owns such shares)
or any of its Restricted Subsidiaries being a limited liability company,
partnership or similar entity for federal income tax purposes;
(5) regardless of whether a Default then exists, the payment of any
dividend by a Restricted Subsidiary of the Company to the holders of its common
Equity Interests on a pro rata basis;
(6) the payment of any dividend on the Helicon Preferred Stock or the
redemption, repurchase, retirement or other acquisition of the Helicon Preferred
Stock in an amount not in excess of its aggregate liquidation value;
(7) the repurchase, redemption or other acquisition or retirement for
value, or the payment of any dividend or distribution to the extent necessary to
permit the repurchase, redemption or other acquisition or retirement for value,
of any Equity Interests of the Company or a Parent held by any member of the
Company's or such Parent's management pursuant to any management equity
subscription agreement or membership or stock option agreement in effect as of
the Issue Date; provided that the aggregate price paid for all such repurchased,
redeemed, acquired or retired Equity Interests shall not exceed $10 million in
any fiscal year of the Company; and
(8) payment of fees in connection with any acquisition, merger or
similar transaction in an amount that does not exceed an amount equal to 1.25%
of the transaction value of such acquisition, merger or similar transaction.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or any of its
Restricted Subsidiaries pursuant to the Restricted Payment. The fair market
value of any assets or securities that are required to be valued by this
covenant shall be determined by the Board of Directors of the Company, whose
resolution with respect thereto shall be delivered to the Trustee. Such Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if the
fair market value exceeds $100 million. Not later than the date of making any
Restricted
53
Payment, the Company shall deliver to the Trustee an Officers' Certificate
stating that such Restricted Payment is permitted and setting forth the basis
upon which the calculations required by this Section 4.07 were computed,
together with a copy of any fairness opinion or appraisal required by this
Indenture.
Section 4.08. Investments.
-----------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) make any Restricted Investment; or
(2) allow any Restricted Subsidiary of the Company to become an
Unrestricted Subsidiary,
unless, in each case:
(1) no Default or Event of Default shall have occurred and be continuing
or would occur as a consequence thereof; and
(2) the Company would, at the time of, and after giving effect to, such
Restricted Investment or such designation of a Restricted Subsidiary as an
Unrestricted Subsidiary, have been permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Leverage Ratio test set forth in the
first paragraph of Section 4.10.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution of the Company giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by this Section 4.08.
If, at any time, any Unrestricted Subsidiary would fail to meet the requirements
as an Unrestricted Subsidiary described in the definition of "Unrestricted
Subsidiary," it shall thereafter cease to be an Unrestricted Subsidiary for
purposes of this Indenture and any Indebtedness of such Subsidiary shall be
deemed to be incurred by a Restricted Subsidiary of the Company as of such date
and, if such Indebtedness is not permitted to be incurred as of such date under
Section 4.10, the Company shall be in default. The Board of Directors of the
Company may at any time designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that such designation shall be deemed to be an incurrence
of Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if (1) such Indebtedness is permitted under Section 4.10 calculated on
a pro forma basis as if such designation had occurred at the beginning of the
Reference Period; and (2) no Default or Event of Default would be in existence
following such designation.
54
Section 4.09. Dividend and Other Payment Restrictions Affecting Subsidiaries.
--------------------------------------------------------------
The Company shall not, directly or indirectly, create or permit to exist
or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Company to:
(1) pay dividends or make any other distributions on its Capital Stock
to the Company or any of its Restricted Subsidiaries, or with respect to any
other interest or participation in, or measured by, its profits, or pay any
Indebtedness owed to the Company or any of its Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(3) transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries.
However, the preceding restrictions shall not apply to encumbrances or
restrictions existing under or by reason of:
(1) Existing Indebtedness as in effect on the Issue Date (including,
without limitation, the Credit Facilities) and any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings thereof, provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings are no more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in such Existing
Indebtedness, as in effect on the Issue Date;
(2) this Indenture, the Notes and the Other Notes;
(3) applicable law;
(4) any instrument governing Indebtedness or Capital Stock of a Person
acquired by the Company or any of its Restricted Subsidiaries as in effect at
the time of such acquisition (except to the extent such Indebtedness was
incurred in connection with or in contemplation of such acquisition), which
encumbrance or restriction is not applicable to any Person, or the properties or
assets of any Person, other than the Person, or the property or assets of the
Person, so acquired; provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred;
(5) customary non-assignment provisions in leases entered into in the
ordinary course of business and consistent with past practices;
55
(6) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions on the property so acquired of the
nature described in clause (3) of the preceding paragraph;
(7) any agreement for the sale or other disposition of a Restricted
Subsidiary of the Company that restricts distributions by such Restricted
Subsidiary pending its sale or other disposition;
(8) Permitted Refinancing Indebtedness; provided that the restrictions
contained in the agreements governing such Permitted Refinancing Indebtedness
are no more restrictive, taken as a whole, than those contained in the
agreements governing the Indebtedness being refinanced;
(9) Liens securing Indebtedness otherwise permitted to be incurred under
Section 4.14 that limit the right of the Company or any of its Restricted
Subsidiaries to dispose of the assets subject to such Lien;
(10) provisions with respect to the disposition or distribution of
assets or property in joint venture agreements and other similar agreements
entered into in the ordinary course of business;
(11) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business;
(12) restrictions contained in the terms of Indebtedness permitted to be
incurred under Section 4.10; provided that such restrictions are no more
restrictive than the terms contained in the Credit Facilities as in effect on
the Issue Date; and
(13) restrictions that are not materially more restrictive than
customary provisions in comparable financings and the management of the Company
determines that such restrictions will not materially impair the Company's
ability to make payments as required under the Notes.
Section 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock.
----------------------------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Company shall not issue any Disqualified Stock and shall not
permit any of its Restricted Subsidiaries to issue any shares of Preferred Stock
unless the Leverage Ratio would have been not greater than 8.75 to 1.0
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom) as if the additional Indebtedness had been incurred, or the
56
Disqualified Stock had been issued, as the case may be, at the beginning of the
most recently ended fiscal quarter.
So long as no Default shall have occurred and be continuing or would be
caused thereby, the first paragraph of this covenant shall not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the incurrence by the Company and its Restricted Subsidiaries of
Indebtedness under the Credit Facilities; provided that the aggregate principal
amount of all Indebtedness of the Company and its Restricted Subsidiaries
outstanding under all Credit Facilities after giving effect to such incurrence
does not exceed an amount equal to $3.5 billion less the aggregate amount of all
Net Proceeds of Asset Sales applied by the Company or any of its Subsidiaries in
the case of an Asset Sale since March 17, 1999 to repay Indebtedness under a
Credit Facility pursuant to Section 4.11;
(2) the incurrence by the Company and its Restricted Subsidiaries of
Existing Indebtedness (other than the Credit Facilities);
(3) the incurrence on the Issue Date by the Company and its Restricted
Subsidiaries of Indebtedness represented by the Notes (other than any Additional
Notes) and the Other Notes;
(4) the incurrence by the Company or any of its Restricted Subsidiaries
of Indebtedness represented by Capital Lease Obligations, mortgage financings or
purchase money obligations, in each case, incurred for the purpose of financing
all or any part of the purchase price or cost of construction or improvement
(including, without limitation, the cost of design, development, construction,
acquisition, transportation, installation, improvement, and migration) of
Productive Assets of the Company or any of its Restricted Subsidiaries, in an
aggregate principal amount not to exceed $75 million at any time outstanding;
(5) the incurrence by the Company or any of its Restricted Subsidiaries
of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to refund, refinance or replace, in whole or in part,
Indebtedness (other than intercompany Indebtedness) that was permitted by this
Indenture to be incurred under the first paragraph of this covenant or clauses
(2) or (3) of this paragraph;
(6) the incurrence by the Company or any of its Restricted Subsidiaries
of intercompany Indebtedness between or among the Company and any of its Wholly
Owned Restricted Subsidiaries; provided that:
(a) if the Company is the obligor on such Indebtedness, such
Indebtedness must be expressly subordinated to the prior payment in full
in cash of all Obligations with respect to the Notes; and
57
(b) (i) any subsequent issuance or transfer of Equity Interests that
results in any such Indebtedness being held by a Person other than the
Company or a Wholly Owned Restricted Subsidiary thereof and (ii) any
sale or other transfer of any such Indebtedness to a Person that is not
either the Company or a Wholly Owned Restricted Subsidiary thereof,
shall be deemed, in each case, to constitute an incurrence of such
Indebtedness by the Company or any of its Restricted Subsidiaries that
was not permitted by this clause (6);
(7) the incurrence by the Company or any of its Restricted Subsidiaries
of Hedging Obligations that are incurred for the purpose of fixing or hedging
interest rate risk with respect to any floating rate Indebtedness that is
permitted by the terms of this Indenture to be outstanding;
(8) the guarantee by the Company of Indebtedness of a Restricted
Subsidiary of the Company that was permitted to be incurred by another provision
of this Section 4.10;
(9) the incurrence by the Company or any of its Restricted Subsidiaries
of additional Indebtedness in an aggregate principal amount at any time
outstanding not to exceed $300 million;
(10) the incurrence by the Company or any of its Restricted Subsidiaries
of additional Indebtedness in an aggregate principal amount at any time
outstanding not to exceed 200% of the net cash proceeds received by the Company
from the sale of its Equity Interests (other than Disqualified Stock) after
March 17, 1999 to the extent such net cash proceeds have not been applied to
make Restricted Payments or to effect other transactions pursuant to Section
4.07 or to make Permitted Investments pursuant to clause (5) of the definition
thereof; and
(11) the accretion or amortization of original issue discount and the
write up of Indebtedness in accordance with purchase accounting.
For purposes of determining compliance with this Section 4.10, in the
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (1) through (11) above,
or is entitled to be incurred pursuant to the first paragraph of this covenant,
the Company shall be permitted to classify and from time to time to reclassify
such item of Indebtedness in any manner that complies with this covenant. For
avoidance of doubt, Indebtedness incurred pursuant to a single agreement,
instrument, program, facility or line of credit may be classified as
Indebtedness arising in part under one of the clauses listed above, and in part
under any one or more of the clauses listed above, to the extent that such
Indebtedness satisfies the criteria for such clauses.
58
Notwithstanding the foregoing, in no event shall any Restricted
Subsidiary of the Company consummate a Subordinated Debt Financing or a
Preferred Stock Financing. A "Subordinated Debt Financing" or a "Preferred Stock
Financing", as the case may be, with respect to any Restricted Subsidiary of the
Company shall mean a public offering or private placement (whether pursuant to
Rule 144A under the Securities Act or otherwise) of Subordinated Notes or
Preferred Stock (whether or not such Preferred Stock constitutes Disqualified
Stock), as the case may be, of such Restricted Subsidiary to one or more
purchasers (other than to one or more Affiliates of the Company). "Subordinated
Notes" with respect to any Restricted Subsidiary of the Company shall mean
Indebtedness of such Restricted Subsidiary that is contractually subordinated in
right of payment to any other Indebtedness of such Restricted Subsidiary
(including, without limitation, Indebtedness under the Credit Facilities). The
foregoing limitation shall not apply to (i) any Indebtedness or Preferred Stock
of any Person existing at the time such Person is merged with or into or became
a Subsidiary of the Company; provided that such Indebtedness or Preferred Stock
was not incurred or issued in connection with, or in contemplation of, such
Person merging with or into, or becoming a Subsidiary of, the Company and (ii)
any Indebtedness or Preferred Stock of a Restricted Subsidiary issued in
connection with, and as part of the consideration for, an acquisition, whether
by stock purchase, asset sale, merger or otherwise, in each case involving such
Restricted Subsidiary, which Indebtedness or Preferred Stock is issued to the
seller or sellers of such stock or assets; provided that such Restricted
Subsidiary is not obligated to register such Indebtedness or Preferred Stock
under the Securities Act or obligated to provide information pursuant to Rule
144A under the Securities Act.
Section 4.11. Limitation on Asset Sales.
-------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company or a Restricted Subsidiary of the Company, as the case
may be, receives consideration at the time of such Asset Sale at least equal to
the fair market value of the assets or Equity Interests issued or sold or
otherwise disposed of;
(2) such fair market value is determined by the Company's Board of
Directors and evidenced by a resolution of such Board of Directors set forth in
an Officers' Certificate delivered to the Trustee; and
(3) at least 75% of the consideration therefor received by the Company
or such Restricted Subsidiary is in the form of cash, Cash Equivalents or
readily marketable securities.
59
For purposes of this Section 4.11, each of the following shall be deemed
to be cash:
(a) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet) of the Company or any Restricted
Subsidiary of the Company (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes) that are
assumed by the transferee of any such assets pursuant to a customary
novation agreement that releases the Company or such Restricted
Subsidiary from further liability;
(b) any securities, notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee that are
converted by the Company or such Restricted Subsidiary into cash, Cash
Equivalents or readily marketable securities within 60 days after
receipt thereof (to the extent of the cash, Cash Equivalents or readily
marketable securities received in that conversion); and
(c) Productive Assets.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company or a Restricted Subsidiary of the Company, as the case may be,
may apply such Net Proceeds at its option:
(1) to repay debt under the Credit Facilities or any other Indebtedness
of the Restricted Subsidiaries of the Company (other than Indebtedness
represented by a guarantee of a Restricted Subsidiary of the Company); or
(2) to invest in Productive Assets; provided that any Net Proceeds which
the Company or a Restricted Subsidiary of the Company, as the case may be, has
committed to invest in Productive Assets within 365 days of the applicable Asset
Sale may be invested in Productive Assets within two years of such Asset Sale.
The amount of any Net Proceeds received by the Company or a Restricted
Subsidiary of the Company from Asset Sales that are not applied or invested as
provided in the preceding paragraph shall constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $25 million, the Issuers shall make
an Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions requiring
offers to purchase or redeem with the proceeds of sales of assets to purchase
the maximum principal amount of Notes and such other pari passu Indebtedness
that may be purchased out of the Excess Proceeds (which amount includes the
entire amount of the Net Proceeds). The offer price in any Asset Sale Offer
shall be payable in cash and equal to 100% of principal amount plus accrued and
unpaid interest, if any, to the date of purchase. If any Excess Proceeds remain
after consummation of an Asset Sale Offer, the Company or a Restricted
Subsidiary of the
60
Company may use such Excess Proceeds for any purpose not otherwise prohibited by
this Indenture. If the aggregate principal amount of Notes and such other pari
passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
In the event that the Issuers shall be required to commence an offer to
Holders to purchase Notes pursuant to this Section 4.11, they shall follow the
procedures specified in Section 3.03.
Section 4.12. Sale and Leaseback Transactions.
-------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company may enter into a sale and leaseback transaction if:
(1) the Company could have (a) incurred Indebtedness in an amount equal
to the Attributable Debt relating to such sale and leaseback transaction under
the Leverage Ratio test in the first paragraph of Section 4.10 and (b) incurred
a Lien to secure such Indebtedness pursuant to Section 4.14; and
(2) the transfer of assets in that sale and leaseback transaction is
permitted by, and the Company applies the proceeds of such transaction in
compliance with, Section 4.11.
The foregoing restrictions shall not apply to a sale and leaseback
transaction if the lease is for a period, including renewal rights, of not in
excess of three years.
Section 4.13. Transactions with Affiliates.
----------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each, an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less favorable to
the Company or the relevant Restricted Subsidiary than those that would have
been obtained in a comparable transaction by the Company or such Restricted
Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
61
(a) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$15 million, a resolution of the Board of Directors of the Company set
forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with this Section 4.13 and that such Affiliate
Transaction has been approved by a majority of the members of such Board
of Directors; and
(b) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$50 million, an opinion as to the fairness to the Holders of such
Affiliate Transaction from a financial point of view issued by an
accounting, appraisal or investment banking firm of national standing.
The following items shall not be deemed to be Affiliate Transactions
and, therefore, shall not be subject to the provisions of the prior paragraph:
(1) any existing employment agreement entered into by the Company or any
of its Subsidiaries and any employment agreement entered into by the Company or
any of its Restricted Subsidiaries in the ordinary course of business and
consistent with the past practice of the Company or such Restricted Subsidiary;
(2) transactions between or among the Company and/or its Restricted
Subsidiaries;
(3) payment of reasonable directors fees to Persons who are not
otherwise Affiliates of the Company and customary indemnification and insurance
arrangements in favor of directors, regardless of affiliation with the Company
or any of its Restricted Subsidiaries;
(4) payment of management fees pursuant to management agreements either
(A) existing on the Issue Date or (B) entered into after the Issue Date, to the
extent that such management agreements provide for percentage fees no higher
than the percentage fees existing under the management agreements existing on
the Issue Date;
(5) Restricted Payments that are permitted by Section 4.07 and
Restricted Investments that are permitted by Section 4.08; and
(6) Permitted Investments.
Section 4.14. Liens.
-----
The Company shall not, directly or indirectly, create, incur, assume or
suffer to exist any Lien of any kind securing Indebtedness, Attributable Debt or
trade payables on any asset now owned or hereafter acquired, except Permitted
Liens.
62
Section 4.15. Existence.
---------
Subject to Article 5, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its limited
liability company existence, and the corporate, partnership or other existence
of each of its Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Subsidiary and (ii) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Subsidiaries
(other than Charter Capital), if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.16. Repurchase at the Option of Holders upon a Change of Control.
------------------------------------------------------------
If a Change of Control occurs, each Holder of Notes shall have the right
to require the Issuers to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of that Holder's Notes pursuant to a Change of
Control Offer. In the Change of Control Offer, the Issuers shall offer (a
"Change of Control Offer") a payment (the "Change of Control Payment") in cash
equal to 101% of the aggregate principal amount of Notes repurchased plus
accrued and unpaid interest thereon, if any, to the date of purchase.
Within ten days following any Change of Control, the Issuers shall mail
a notice to each Holder (with a copy to the Trustee) describing the transaction
or transactions that constitute the Change of Control and stating:
(a) the purchase price and the purchase date, which shall not exceed 30
Business Days from the date such notice is mailed (the "Change of Control
Payment Date");
(b) that any Note not tendered shall continue to accrue interest;
(c) that, unless the Issuers default in the payment of the Change of
Control Payment, all Notes accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of Control Payment
Date;
(d) that Holders electing to have any Notes purchased pursuant to a
Change of Control Offer shall be required to surrender the Notes, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Change of Control
Payment Date;
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(e) that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of Notes delivered for purchase, and a statement that such
Holder is withdrawing his election to have the Notes purchased; and
(f) that Holders whose Notes are being purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof.
The Issuers shall comply with the requirements of Rule 14e-1 under the
Exchange Act (or any successor rules) and any other securities laws and
regulations thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of the Notes as a result of a Change of Control.
On the Change of Control Payment Date, the Issuers shall, to the extent
lawful:
(a) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer;
(b) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions thereof so tendered; and
(c) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the aggregate principal
amount of Notes or portions thereof being purchased by the Issuers.
The Paying Agent shall promptly pay to each Holder of Notes so tendered
the Change of Control Payment for such Notes, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a new Note equal in principal amount to any unpurchased portion of the Notes
surrendered, if any; provided that each such new Note shall be in a principal
amount of $1,000 or an integral multiple thereof. The Company shall publicly
announce the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Payment Date.
The provisions described above that require the Issuers to make a Change
of Control Offer following a Change of Control shall be applicable regardless of
whether or not any other provisions in this Indenture are applicable. Except as
described above with respect to a Change of Control, this Indenture does not
contain provisions that permit the Holders of the Notes to require that the
Issuers repurchase or redeem the Notes in the event of a takeover,
recapitalization or similar transaction.
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Notwithstanding any other provision of this Section 4.16, the Issuers
shall not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in this Indenture
applicable to a Change of Control Offer made by the Issuers and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.
Section 4.17. Limitations on Issuances of Guarantees of Indebtedness.
------------------------------------------------------
The Company shall not permit any of its Restricted Subsidiaries,
directly or indirectly, to Guarantee or pledge any assets to secure the payment
of any other Indebtedness of the Company except in respect of the Credit
Facilities (the "Guaranteed Indebtedness") unless (i) such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture providing for the
Guarantee (a "Subsidiary Guarantee") of the payment of the Notes by such
Restricted Subsidiary and (ii) until one year after all the Notes have been paid
in full in cash, such Restricted Subsidiary waives and will not in any manner
whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary of the Company as a result of any payment by
such Restricted Subsidiary under its Subsidiary Guarantee; provided that this
paragraph shall not be applicable to any Guarantee or any Restricted Subsidiary
that existed at the time such Person became a Restricted Subsidiary and was not
incurred in connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary. If the Guaranteed Indebtedness is subordinated to the
Notes, then the Guarantee of such Guaranteed Indebtedness shall be subordinated
to the Subsidiary Guarantee at least to the extent that the Guaranteed
Indebtedness is subordinated to the Notes.
Section 4.18. Payments for Consent.
--------------------
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration to or for the
benefit of any Holder of Notes for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid and is paid to all Holders of
the Notes that consent, waive or agree to amend in the time frame set forth in
the solicitation documents relating to such consent, waiver or agreement.
Section 4.19. Application of Fall-Away Covenants.
----------------------------------
During any period of time that (a) the Notes have Investment Grade
Ratings from both Rating Agencies and (b) no Default or Event of Default has
occurred and is continuing, the Company and its Restricted Subsidiaries shall
not be subject to the provisions of Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12,
4.13 and clause (4) of the first
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paragraph of Section 5.01 (collectively, the "Suspended Covenants"). In the
event that the Company and its Restricted Subsidiaries are not subject to the
Suspended Covenants for any period of time as a result of the preceding sentence
and, subsequently, one or both of the Rating Agencies withdraws its ratings or
downgrades the ratings assigned to the Notes below the required Investment Grade
Ratings or a Default or Event of Default occurs and is continuing, then the
Company and its Restricted Subsidiaries shall thereafter again be subject to the
Suspended Covenants and compliance with the Suspended Covenants with respect to
the Restricted Payments made after the time of such withdrawal, downgrade,
Default or Event of Default will be calculated in accordance with the terms of
Section 4.07 as though such covenant had been in effect during the entire period
of time from the Issue Date.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets.
----------------------------------------
Neither of the Issuers may, directly or indirectly: (1) consolidate or
merge with or into another Person (whether or not such Issuer is the surviving
corporation); or (2) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of its properties or assets, in one or more related
transactions, to another Person; unless:
(1) either: (a) such Issuer is the surviving corporation; or (b) the
Person formed by or surviving any such consolidation or merger (if other than
such Issuer) or to which such sale, assignment, transfer, conveyance or other
disposition shall have been made is a Person organized or existing under the
laws of the United States, any state thereof or the District of Columbia
(provided that if the Person formed by or surviving any such consolidation or
merger with either Issuer is a limited liability company or a Person other than
a corporation, a corporate co-issuer shall also be an obligor with respect to
the Notes);
(2) the Person formed by or surviving any such consolidation or merger
(if other than the Company) or the Person to which such sale, assignment,
transfer, conveyance or other disposition shall have been made assumes all the
obligations of the Company under the Notes and this Indenture pursuant to
agreements reasonably satisfactory to the Trustee;
(3) immediately after such transaction no Default or Event of Default
exists; and
(4) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company) will, on the date of such
transaction after giving pro
66
forma effect thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, either (a) be
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Leverage Ratio test set forth in the first paragraph of Section 4.10 or (b) have
a Leverage Ratio immediately after giving effect to such consolidation or merger
no greater than the Leverage Ratio immediately prior to such consolidation or
merger.
In addition, the Company may not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 shall not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the Company and any of its Wholly Owned Subsidiaries.
Section 5.02. Successor Corporation Substituted.
---------------------------------
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of either Issuer in accordance with Section 5.01, the successor Person formed by
such consolidation or into which either Issuer is merged or to which such
transfer is made shall succeed to and (except in the case of a lease) be
substituted for, and may exercise every right and power of, such Issuer under
this Indenture with the same effect as if such successor Person had been named
therein as such Issuer, and (except in the case of a lease) such Issuer shall be
released from the obligations under the Notes and this Indenture, except with
respect to any obligations that arise from, or are related to, such transaction.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
-----------------
An "Event of Default" occurs if:
(a) the Issuers default in the payment when due of interest on the Notes
and such default continues for a period of 30 days;
(b) the Issuers default in payment when due of the principal of or
premium, if any, on the Notes;
(c) the Company or any of its Restricted Subsidiaries fails to comply
with any of the provisions of Sections 4.16 or 5.01;
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(d) the Company or any of its Restricted Subsidiaries fails to comply
with any of their other covenants or agreements in this Indenture for 30 days
after written notice thereof has been given to the Company by the Trustee or to
the Company and the Trustee by Holders of at least 25% of the aggregate
principal amount of the Notes outstanding;
(e) the Company or any of its Restricted Subsidiaries defaults under any
mortgage, indenture or instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness for money borrowed (or the
payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries) whether such Indebtedness or guarantee now exists or is created
after the Issue Date, if that default:
(1) is caused by a failure to pay at final stated maturity the
principal amount on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default
(a "Payment Default"); or
(2) results in the acceleration of such Indebtedness prior to its
express maturity,
and, in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more;
(f) the Company or any of its Restricted Subsidiaries fails to pay final
judgments which are non-appealable aggregating in excess of $100 million (net of
applicable insurance which has not been denied in writing by the insurer), which
judgments are not paid, discharged or stayed for a period of 60 days;
(g) the Company or any of its Significant Subsidiaries pursuant to or
within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property, or
(iv) makes a general assignment for the benefit of its creditors; or
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
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(i) is for relief against the Company or any of its Significant
Subsidiaries in an involuntary case;
(ii) appoints a custodian of the Company or any of its Significant
Subsidiaries or for all or substantially all of the property of the
Company or any of its Significant Subsidiaries; or
(iii) orders the liquidation of the Company or any of its Significant
Subsidiaries;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Section 6.02. Acceleration.
------------
In the case of an Event of Default arising from clause (g) or (h) of
Section 6.01 with respect to the Company, all outstanding Notes shall become due
and payable immediately without further action or notice. If any other Event of
Default occurs and is continuing, the Trustee by notice to the Issuers or the
Holders of at least 25% in principal amount of the then outstanding Notes by
notice to the Issuers and the Trustee may declare all the Notes to be due and
payable immediately. The Holders of a majority in aggregate principal amount of
the Notes then outstanding by written notice to the Trustee may on behalf of all
of the Holders rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal, interest or premium that has become due
solely because of the acceleration) have been cured or waived.
Section 6.03. Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Existing Defaults.
---------------------------
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default or Event of Default and its
consequences hereunder,
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except a continuing Default or Event of Default in the payment of the principal
of, premium, if any, or interest on, the Notes (including in connection with an
offer to purchase) (provided, however, that the Holders of a majority in
aggregate principal amount of the then outstanding Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such acceleration). Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
Section 6.05. Control by Majority.
-------------------
Holders of a majority in principal amount of the then outstanding Notes
may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability. The Trustee may take any other action which it
deems proper that is not inconsistent with any such directive.
Section 6.06. Limitation on Suits.
-------------------
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
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Section 6.07. Rights of Holders of Notes to Receive Payment.
---------------------------------------------
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium, if any, and interest
on the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
Section 6.08. Collection Suit by Trustee.
--------------------------
If an Event of Default specified in Section 6.01(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Issuers for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
--------------------------------
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Issuers
(or any other obligor upon the Notes), their creditors or their property and
shall be entitled and empowered to collect, receive and distribute any money or
other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 out of the
estate in any such proceeding, shall be denied for any reason, payment of the
same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
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Section 6.10. Priorities.
----------
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses
of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes
for principal, premium, if any and interest, respectively; and
Third: to the Issuers or to such party as a court of competent jurisdiction
shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07, or a suit by Holders of more than 10%
in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
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(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii)in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
required to be furnished to the Trustee hereunder and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture (but need not confirm or investigate
the accuracy of any mathematical calculations or other facts stated
therein).
(c) The Trustee may not be relieved from liabilities for its own gross
negligent action, its own gross negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii)the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the
Trustee was grossly negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability, claim,
damage or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuers. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
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(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or documents.
Section 7.02. Rights of Trustee.
-----------------
(a) The Trustee may conclusively rely upon any document (whether in its
original or facsimile form) believed by it to be genuine and to have been signed
or presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its own selection and the written advice or opinion of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from either of the Issuers shall be
sufficient if signed by an Officer of such Issuer.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it against the costs, expenses
and liabilities that might be incurred by it in compliance with such request or
direction.
(g) The Trustee shall not be charged with knowledge of any Default or
Event of Default unless either (i) a Responsible Officer of the Trustee shall
have actual knowledge of such Default or Event of Default or (ii) written notice
of such Default or Event of Default shall have been given to and received by a
Responsible Officer of the Trustee by the Issuers or any Holder.
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Section 7.03. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Issuers or any Affiliate of
the Issuers with the same rights it would have if it were not Trustee. However,
in the event that the Trustee acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue as trustee or resign. Any Agent may do the same with like rights and
duties. The Trustee is also subject to Sections 7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
--------------------
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuers' use of the proceeds from the Notes or any money
paid to the Issuers or upon the Issuers' direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
------------------
If a Default or Event of Default occurs and is continuing and if it is
known to a Responsible Officer of the Trustee, the Trustee shall mail to Holders
of Notes a notice of the Default or Event of Default within 90 days after the
Trustee acquires knowledge thereof. Except in the case of a Default or Event of
Default in payment of principal of, premium, if any, or interest on any Note,
the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders of the Notes.
Section 7.06. Reports by Trustee to Holders of the Notes.
------------------------------------------
Within 60 days after each May 15 beginning with the May 15 following the
date of this Indenture, and for so long as Notes remain outstanding, the Trustee
shall mail to the Holders of the Notes a brief report dated as of such reporting
date that complies with TIA ss. 313(a) (but if no event described in TIA ss.
313(a) has occurred within the twelve months preceding the reporting date, no
report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the SEC and each stock exchange on
which the Notes are listed in accordance with TIA ss. 313(d). The Issuers shall
promptly notify the Trustee when the Notes are listed on any stock exchange.
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Section 7.07. Compensation and Indemnity.
--------------------------
The Issuers shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuers shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Issuers shall, jointly and severally, indemnify the Trustee against
any and all losses, liabilities, claims, damages or expenses (including
reasonable legal fees and expenses) incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Issuers (including this Section 7.07) and defending itself against any claim
(whether asserted by the Issuers or any Holder or any other person) or liability
in connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such loss, liability or expense may be
attributable to its gross negligence or willful misconduct. The Trustee shall
notify the Issuers promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Issuers shall not relieve the Issuers of
their obligations hereunder. The Issuers shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Issuers shall pay the reasonable fees and expenses of such counsel. The Issuers
need not pay for any settlement made without their consent, which consent shall
not be unreasonably withheld.
The obligations of the Issuers this Section 7.07 shall survive
resignation or removal of the Trustee and the satisfaction and discharge of this
Indenture.
To secure the Issuers' payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and interest on
particular Notes. Such Lien shall survive the resignation or removal of the
Trustee and the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to the
extent applicable.
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Section 7.08. Replacement of Trustee.
----------------------
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Issuers. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Issuers in writing. The Issuers may remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuers shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Issuers.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuers, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition at the expense of the Company any court of competent jurisdiction
for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee; provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07.
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Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the
Issuers' obligations under Section 7.07 shall continue for the benefit of the
retiring Trustee.
Section 7.09. Successor Trustee by Merger, etc.
--------------------------------
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
Section 7.10. Eligibility; Disqualification.
-----------------------------
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
Section 7.11. Preferential Collection of Claims Against the Issuers.
-----------------------------------------------------
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.
--------------------------------------------------------
The Issuers may, at the option of their respective Boards of Directors
evidenced by a resolution set forth in an Officers' Certificate of each of the
Issuers, at any time, elect to have either Section 8.02 or 8.03 be applied to
all outstanding Notes upon compliance with the conditions set forth below in
this Article 8.
Section 8.02. Legal Defeasance and Discharge.
------------------------------
Upon the Issuers' exercise under Section 8.01 of the option applicable
to this Section 8.02, the Issuers shall, subject to the satisfaction of the
conditions set forth in
78
Section 8.04, be deemed to have been discharged from their obligations with
respect to all outstanding Notes on the date the conditions set forth below are
satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance
means that the Issuers shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes, which shall thereafter be
deemed to be "outstanding" only for the purposes of Section 8.05 and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all their other obligations under such Notes and this Indenture (and
the Trustee, on demand of and at the expense of the Issuers, shall execute
proper instruments acknowledging the same), except for the following provisions
which shall survive until otherwise terminated or discharged hereunder:
(a) the rights of Holders of outstanding Notes to receive payments in
respect of the principal of, premium, if any, and interest on such Notes when
such payments are due from the trust referred to below;
(b) the Issuers' obligations with respect to the Notes concerning
issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or
stolen Notes and the maintenance of an office or agency for payment and money
for security payments held in trust;
(c) the rights, powers, trusts, duties and immunities of the Trustee and
the Issuers' obligations in connection therewith; and
(d) the Legal Defeasance provisions of this Indenture;
Subject to compliance with this Article 8, the Issuers may exercise
their option under this Section 8.02 notwithstanding the prior exercise of their
option under Section 8.03.
Section 8.03. Covenant Defeasance.
-------------------
Upon the Issuers' exercise under Section 8.01 of the option applicable
to this Section 8.03, the Issuers shall, subject to the satisfaction of the
conditions set forth in Section 8.04, be released from their obligations under
the covenants contained in Article 5 and Sections 4.03, 4.07, 4.08, 4.09, 4.10,
4.11, 4.12, 4.13, 4.14, 4.16, 4.17 and 4.19 with respect to the outstanding
Notes on and after the date the conditions set forth in Section 8.04 are
satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall thereafter
be deemed not "outstanding" for the purposes of any direction, waiver, consent
or declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes, the Issuers may
omit to comply with and shall have no liability in
79
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other provision herein or in any other document and such omission to comply
shall not constitute a Default or an Event of Default under Section 6.01, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. In addition, upon the Issuers' exercise under Section
8.01 of the option applicable to this Section 8.03, subject to the satisfaction
of the conditions set forth in Section 8.04, Sections 6.01(c) through 6.01(f)
shall not constitute Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
------------------------------------------
The following shall be the conditions to the application of either
Section 8.02 or 8.03 to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(1) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on the
outstanding Notes on the stated maturity or on the applicable redemption date,
as the case may be, and the Company must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(2) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that (a) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling or (b) since the Issue Date, there has
been a change in the applicable federal income tax law, in either case to the
effect that, and based thereon such opinion of counsel shall confirm that, the
Holders of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not
occurred;
(3) in the case of Covenant Defeasance, the Company shall have delivered
to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that the Holders of the outstanding Notes will not recognize income,
gain or loss for federal income tax purposes as a result of such Covenant
Defeasance and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
80
(4) no Default or Event of Default shall have occurred and be continuing
either: (a) on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such deposit); or
(b) or insofar as Events of Default from bankruptcy or insolvency events are
concerned, at any time in the period ending on the 91st day after the date of
deposit;
(5) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;
(6) the Company must have delivered to the Trustee an opinion of counsel
to the effect that after the 91st day assuming no intervening bankruptcy, that
no Holder is an insider of either of the Issuers following the deposit and that
such deposit would not be deemed by a court of competent jurisdiction a transfer
for the benefit of either Issuer in its capacity as such, the trust funds will
not be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally;
(7) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes over the other creditors of the Company with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others; and
(8) the Company must deliver to the Trustee an Officers' Certificate and
an opinion of counsel, each stating that all conditions precedent relating to
the Legal Defeasance or the Covenant Defeasance have been complied with.
Notwithstanding the foregoing, the opinion of counsel required by clause
(2) above with respect to a Legal Defeasance need not be delivered if all Notes
not theretofore delivered to the Trustee for cancellation (i) have become due
and payable or (ii) will become due and payable on the maturity date within one
year, by their terms or under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense,
of the Issuers.
Section 8.05. Deposited Money and Government Securities to Be Held in Trust;
Other Miscellaneous Provisions.
- --------------------------------------------------------------------------------
Subject to Section 8.06, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 in respect of the outstanding Notes shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Notes and this Indenture, to the payment, either
81
directly or through any Paying Agent (including the Issuers acting as Paying
Agent) as the Trustee may determine, to the Holders of such Notes of all sums
due and to become due thereon in respect of principal, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Issuers shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Issuers from time to time upon the request of the
Issuers any money or non-callable Government Securities held by it as provided
in Section 8.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a)), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. Repayment to Issuers.
--------------------
Any money deposited with the Trustee or any Paying Agent, or then held
by the Issuers, in trust for the payment of the principal of, premium, if any,
or interest on any Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to the Issuers on their request or (if then held by the Issuers) shall be
discharged from such trust; and the Holder of such Note shall thereafter look
only to the Issuers for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Issuers as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Issuers cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining shall be repaid to the Issuers.
Section 8.07. Reinstatement.
-------------
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers' obligations under
82
this Indenture and the Notes, shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.02 or 8.03 until such time as the
Trustee or Paying Agent is permitted to apply all such money in accordance with
Section 8.02 or 8.03, as the case may be; provided, however, that, if the
Issuers make any payment of principal of, premium, if any, or interest on any
Note following the reinstatement of their obligations, the Issuers shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
-----------------------------------
Notwithstanding Section 9.02 of this Indenture, the Issuers and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(c) to provide for or confirm the issuance of Additional Notes;
(d) to provide for the assumption of either Issuer's obligations to
Holders of Notes in the case of a merger or consolidation or sale of all or
substantially all of the assets of such Issuer pursuant to Article 5;
(e) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under this Indenture of any Holder; or
(f) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA or otherwise as
necessary to comply with applicable law.
Upon the request of the Issuers accompanied by a resolution of their
respective Boards of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02, the Trustee shall join with the Issuers in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further
83
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
Indenture that affects its own rights, duties or immunities under this Indenture
or otherwise.
Section 9.02. With Consent of Holders of Notes.
--------------------------------
Except as provided below in this Section 9.02, this Indenture (including
Sections 4.11 and 4.16) or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in aggregate principal amount of
the Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or a tender offer or exchange offer for, Notes)
and, subject to Sections 6.04 and 6.07, any existing Default or compliance with
any provision of this Indenture or the Notes may be waived with the consent of
the Holders of a majority in aggregate principal amount of the Notes then
outstanding (including, without limitation, consents obtained in connection with
a purchase of, or a tender offer or exchange offer for, Notes). Section 2.08
shall determine which Notes are considered to be "outstanding" for purposes of
this Section 9.02.
Upon the request of the Issuers accompanied by a resolution of their
respective Boards of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02, the
Trustee shall join with the Issuers in the execution of such amended or
supplemental Indenture unless such amended or supplemental Indenture directly
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07, the Holders of a
majority in aggregate principal amount of the Notes then outstanding may waive
compliance in a particular instance by the Issuers with any provision of this
Indenture or the Notes. However, without the consent of each Holder affected, an
amendment, supplement or waiver under this Section 9.02 may not (with respect to
any Notes held by a non-consenting Holder):
84
(a) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter the payment provisions with respect to the redemption of the Notes (other
than provisions relating to Sections 4.11 and 4.16);
(c) reduce the rate of or extend the time for payment of interest on any
Note;
(d) waive a Default or Event of Default in the payment of principal of,
or premium, if any, or interest on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the Notes and a waiver of the payment default that resulted
from such acceleration);
(e) make any Note payable in money other than that stated in the Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of, or premium, if any, or interest on the Notes;
(g) waive a redemption payment with respect to any Note (other than a
payment required by Sections 4.11 and 4.16); or
(h) make any change in this Section 9.02.
Section 9.03. Compliance with Trust Indenture Act.
-----------------------------------
Every amendment or supplement to this Indenture or the Notes shall be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04. Revocation and Effect of Consents.
---------------------------------
Until an amendment, supplement or waiver becomes effective, a consent to
it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
85
Section 9.05. Notation on or Exchange of Notes.
--------------------------------
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Issuers in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
-------------------------------
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Issuers
may not sign an amendment or supplemental Indenture until their respective
Boards of Directors approve it. In executing any amended or supplemental
indenture, the Trustee shall be entitled to receive and (subject to Section
7.01) shall be fully protected in relying upon, in addition to the documents
required by Section 10.04, an Officer's Certificate and an Opinion of Counsel,
in each case from each of the Issuers, stating that the execution of such
amended or supplemental indenture is authorized or permitted by this Indenture.
ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA ss. 318(c), the imposed duties shall control.
Section 10.02. Notices.
-------
Any notice or communication by the Issuers or the Trustee to the others
is duly given if in writing and delivered in Person or mailed by first class
mail (registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
86
If to the Issuers:
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
Telecopier No.: (314) 965-8793
Attention: Secretary
With a copy to:
Paul, Hastings, Janofsky & Walker LLP Irell & Manella
399 Park Avenue 1800 Avenue of the Stars
31st Floor Suite 900
New York, New York 10022 Los Angeles, California 90067
Telecopier No.: (212) 319-4090 Telecopier No.: (310) 556-5393
Attention: Leigh P. Ryan, Esq. Attention: Meredith Jackson, Esq.
If to the Trustee:
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
The Issuers or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA ss. 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.
87
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Issuers mail a notice or communication to Holders, it shall mail
a copy to the Trustee and each Agent at the same time.
Section 10.03. Communication by Holders of Notes with Other Holders of Notes.
-------------------------------------------------------------
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Issuers, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Issuers to the Trustee to take
any action under this Indenture, the Issuers shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 10.05)
stating that, in the opinion of such counsel, all such conditions precedent and
covenants have been satisfied.
Section 10.05. Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA ss.
314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
88
Section 10.06. Rules by Trustee and Agents.
---------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. No Personal Liability of Directors, Officers, Employees, Members
and Stockholders.
- --------------------------------------------------------------------------------
No director, officer, employee, incorporator, member or stockholder of
the Issuers, as such, shall have any liability for any obligations of the
Issuers under the Notes, this Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
Section 10.08. Governing Law.
-------------
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES AND ANY SUBSIDIARY GUARANTEE WITHOUT
GIVING EFFECT TO THE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT
THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE OR THE NOTES OR ANY SUBSIDIARY GUARANTEE.
Section 10.09. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Issuers or their Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10.10. Successors.
----------
All agreements of the Issuers in this Indenture and the Notes, as the
case may be, shall bind their respective successors. All agreements of the
Trustee in this Indenture shall bind its successors.
89
Section 10.11. Severability.
------------
In case any provision in this Indenture or the Notes, as the case may
be, shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 10.12. Counterpart Originals.
---------------------
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 10.13. Table of Contents, Headings, etc.
--------------------------------
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions.
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Notes herein
expressly provided for), and the Trustee, on demand of and at the expense of the
Issuers, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered (other than (i)
Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.07 and (ii) Notes for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Issuers and thereafter repaid to the Issuers or
discharged from such trust,) have been delivered to the Trustee for
cancellation; or
(B) all such Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
90
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Issuers,
and the Issuers, in the case of (i), (ii) or (iii) above, have deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose an amount sufficient to pay and discharge the entire indebtedness on
such Notes not theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest to the date of such deposit (in
the case of Notes which have become due and payable) or to the maturity or
redemption thereof, as the case may be;
(2) the Issuers have paid or caused to be paid all other sums payable
hereunder by the Issuers; and
(3) each of the Issuers have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture pursuant to
this Article 11, the obligations of the Issuers to the Trustee under Section
7.07, and, if money shall have been deposited with the Trustee pursuant to
subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 11.02 shall survive.
Section 11.02. Application of Trust Money.
--------------------------
All money deposited with the Trustee pursuant to Section 11.01 shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Paying Agent
as the Trustee may determine, to the Persons entitled thereto, of the principal
(and premium, if any) and interest for whose payment such money has been
deposited with the Trustee.
[Signatures on following page]
91
SIGNATURES
Dated as of May 15, 2001
CHARTER COMMUNICATIONS HOLDINGS, LLC, as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
CHARTER COMMUNICATIONS HOLDINGS CAPITAL
CORPORATION, as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
BNY MIDWEST TRUST COMPANY,
as Trustee
By: /s/ D.G. DONOVAN
---------------------------------
Name: D.G. Donovan
Title: Assistant Vice President
92
EXHIBIT A
[Face of Note]
CUSIP NO. [_______________]
9.625% Senior Notes due 2009
No.
$[_______________]
CHARTER COMMUNICATIONS HOLDINGS, LLC
and
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
promise to pay to _________________________________________________________
or registered assigns,
the principal amount of _____________________________________________ Dollars
($______________________________) on November 15, 2009.
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
Subject to Restrictions set forth in this Note.
Dated: May 15, 2001
CHARTER COMMUNICATIONS HOLDINGS, LLC
By_________________________________________
Name:
Title:
By_________________________________________
Name:
Title:
1
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
By:_____________________________________
Name:
Title:
By:_____________________________________
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
BNY MIDWEST TRUST COMPANY,
as Trustee
By: __________________________________
Authorized Signatory
A-2
[Back of Note]
9.625% Senior Notes due 2009
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS."(1)
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE
903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT SUBJECT TO THE CERTIFICATION AND DELIVERY
REQUIREMENTS OF THE INDENTURE GOVERNING THE NOTES, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (B) IN
- ----------
1 This paragraph should be included only if the Note is issued in global form.
A-3
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES."(2)
Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
1. INTEREST. Charter Communications Holdings, LLC, a Delaware limited
liability company (the "Company"), and Charter Communications Holdings Capital
Corporation, a Delaware corporation ("Charter Capital" and, together with the
Company, the "Issuers"), promise to pay interest on the principal amount of this
Note at the rate of 9.625% per annum from May 15, 2001 until maturity. The
interest rate on the Notes is subject to increase pursuant to the provisions of
the Registration Rights Agreement. The Issuers will pay interest semi-annually
in arrears on May 15 and November 15 of each year (each an "Interest Payment
Date"), or if any such day is not a Business Day, on the next succeeding
Business Day. Interest on the Notes will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to on
the face and the next succeeding Interest Payment Date, interest shall accrue
from such next succeeding Interest Payment Date; provided, further, that the
first Interest Payment Date shall be November 15, 2001. The Issuers shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate that is 1% per annum in excess of the rate then in effect; they
shall pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. METHOD OF PAYMENT. The Issuers shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the May 1 or November 1 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes will be payable as to
principal, premium, if any, and interest at the office or agency of the Issuers
maintained for such purpose within or without the City and State of New York,
or, at the option of the Issuers, payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and provided that payment by wire transfer of immediately available funds will
be required
- ----------
2 This paragraph should be removed upon the exchange of Notes for Exchange
Notes in an Exchange Offer or upon the registration of the Notes pursuant to the
terms of a Registration Rights Agreement.
A-4
with respect to principal of and interest and premium on all Global Notes and
all other Notes the Holders of which shall have provided wire transfer
instructions to the Issuers or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, BNY Midwest Trust Company, the
Trustee under the Indenture, will act as Paying Agent and Registrar. The Issuers
may change any Paying Agent or Registrar without notice to any Holder. The
Company or any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Issuers issued the Notes under an Indenture dated as
of May 15, 2001 (the "Indenture") between the Issuers and the Trustee. The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and Holders
are referred to the Indenture and such Act for a statement of such terms. To the
extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling.
5. OPTIONAL REDEMPTION.
The Notes will not be redeemable at the Issuers' option prior to
maturity.
6. MANDATORY REDEMPTION.
Except as otherwise provided in Paragraph 7 below, the Issuers shall not
be required to make mandatory redemption payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Issuers shall make an offer (a
"Change of Control Offer") to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of each Holder's Notes at a purchase price equal to
101% of the aggregate principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date of purchase (the "Change of Control Payment").
Within 10 days following any Change of Control, the Issuers shall mail a notice
to each Holder describing the transaction or transactions that constitute the
Change of Control and offering to repurchase Notes on the Change of Control
Payment Date specified in such notice, pursuant to the procedures required by
the Indenture and described in such notice.
(b) If the Company or a Restricted Subsidiary consummates any Asset
Sale, when the aggregate amount of Excess Proceeds exceeds $25.0 million, the
Issuers shall commence an offer (an "Asset Sale Offer") pursuant to Section 4.11
of the Indenture to all Holders of Notes and all holders of other Indebtedness
that is pari passu with the
A-5
Notes containing provisions requiring offers to purchase or redeem with the
proceeds of sales of assets to purchase the maximum principal amount of Notes
and such other pari passu Indebtedness that may be purchased out of the Excess
Proceeds (which amount includes the entire amount of the Net Proceeds). The
offer price in any Asset Sale Offer will be payable in cash and equal to 100% of
principal amount plus accrued and unpaid interest, if any, to the date of
purchase. If any Excess Proceeds remain after consummation of an Asset Sale
Offer, the Company may use such Excess Proceeds for any purpose not otherwise
prohibited by the Indenture. If the aggregate principal amount of Notes and such
other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the
amount of Excess Proceeds, the Trustee shall select the Notes and such other
pari passu Indebtedness to be purchased on a pro rata basis. Upon completion of
each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.
Holders of Notes that are the subject of an offer to purchase will receive an
Asset Sale Offer from the Company prior to any related purchase date and may
elect to have such Notes purchased by completing the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Notes.
8. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Issuers may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Issuers need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Issuers
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.
9. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated
as its owner for all purposes.
10. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount of the Notes then
outstanding (including, without limitation, consents obtained in connection with
a purchase of, or tender offer or exchange offer for, Notes), and any existing
default or compliance with any provision of the Indenture or the Notes may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Notes then outstanding (including, without limitation, consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Notes). Without the consent of any Holder of a Note, the Issuers and the
Trustee may amend or supplement the Indenture or the Notes to cure any
ambiguity, defect or inconsistency, to provide for uncertificated
A-6
Notes in addition to or in place of certificated Notes, to provide for the
assumption of an Issuers' obligations to Holders of Notes in the case of a
merger or consolidation or sale of all or substantially all of the assets of
either Issuer to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, or to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the TIA or otherwise as necessary to comply with applicable law.
11. DEFAULTS AND REMEDIES. Each of the following is an Event of Default:
(i) default for 30 days in the payment when due of interest on the Notes, (ii)
default in payment when due of the principal of or premium, if any, on the
Notes, (iii) failure by the Company or any of its Restricted Subsidiaries to
comply with Sections 4.16 and 5.01 of the Indenture, (iv) failure by the Company
or any of its Restricted Subsidiaries for 30 days after written notice thereof
has been given to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% of the principal amount of the Notes outstanding
to comply with any of their other covenants or agreements in the Indenture, (v)
default under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any Indebtedness for money
borrowed by the Company or any of its Restricted Subsidiaries (or the payment of
which is guaranteed by the Company or any of its Restricted Subsidiaries),
whether such Indebtedness or guarantee now exists or is created after the date
of the Indenture, if that default: (a) is caused by a failure to pay at final
stated maturity the principal amount of such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of such
default (a "Payment Default"); or (b) results in the acceleration of such
Indebtedness prior to its express maturity, and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates $100 million or more, (vi) failure
by the Company or any of its Restricted Subsidiaries to pay final judgments
which are non-appealable aggregating in excess of $100 million (net of
applicable insurance which has not been denied in writing by the insurer), which
judgments are not paid, discharged or stayed for a period of 60 days or (vii)
certain events of bankruptcy or insolvency with respect to the Company or any of
its Significant Subsidiaries. In the case of an Event of Default arising from
certain events of bankruptcy or insolvency with respect to the Company, all
outstanding Notes will become due and payable without further action or notice.
If any other Event of Default occurs and is continuing, the Trustee by notice to
the Issuers or the Holders of at least 25% in principal amount of the then
outstanding Notes by notice to the Issuers and the Trustee may declare all the
Notes to be due and payable. Holders may not enforce the Indenture or the Notes
except as provided in the Indenture. Subject to certain limitations, Holders of
a majority in aggregate principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
A-7
principal or interest) if it determines that withholding notice is in their
interest. The Holders of a majority in aggregate principal amount of the Notes
then outstanding by notice to the Trustee may on behalf of the Holders of all of
the Notes waive any existing Default or Event of Default and its consequences
under the Indenture except a continuing Default or Event of Default in the
payment of interest on, or the principal of, the Notes. The Company is required
to deliver to the Trustee annually a statement regarding compliance with the
Indenture. Upon becoming aware of any Default or Event of Default, the Company
is required to deliver to the Trustee a statement specifying such Default or
Event of Default.
12. TRUSTEE DEALINGS WITH ISSUERS. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Issuers or their Affiliates, and may otherwise deal with the Issuers or
their Affiliates, as if it were not the Trustee.
13. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator, member or stockholder of either of the Issuers, as such, shall not
have any liability for any obligations of the Issuers under the Notes or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
14. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS NOTE AND THE INDENTURE WITHOUT GIVING EFFECT
TO THE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. EACH
OF THE PARTIES HERETO AND THE HOLDERS AGREE TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE.
15. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in any Registration Rights
Agreement.
A-8
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Issuers have caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive
Suite 100
St. Louis, Missouri 63131
Attention: Secretary
Telecopier No.: (314) 965-0555
A-9
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
_________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________ to
transfer this Note on the books of the Issuers. The agent may substitute another
to act for him.
Date:______________________________
Your Signature:_____________________________________________________
(Sign exactly as your name appears on the face of this
Note)
Signature Guarantee*:________________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuers pursuant
to Section 4.11 or 4.16 of the Indenture, check the appropriate box below:
|_| Section 4.11 |_| Section 4.16
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.11 or Section 4.16 of the Indenture, state the
amount you elect to have purchased:
$________________________
Date:____________________
Your Signature: ____________________________________________________
(Sign exactly as your name appears on the face of this
Note)
Tax Identification No.: _______________________________________________
Signature Guarantee*: _______________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-11
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or Definitive Note for an interest in this Global Note, have been
made:
Amount of Amount of Principal
decrease in increase in Amount of this
Principal Principal Global Note
Amount of Amount of this following such Signature of authorized
Date of this Global Global decrease officer of Trustee or
Exchange Note Note (or increase) Note Custodian
- ---------------------------------------------------------------------------------------
A-12
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 9.625% Senior Notes due 2009
Reference is hereby made to the Indenture, dated as of May 15, 2001 (the
"Indenture"), among Charter Communications Holdings, LLC (the "Company") and
Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
___________________ (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $_____________________________ in such Note[s] or interests
(the "Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. |_| Check if Transferee will take delivery of a beneficial interest
in the Rule 144A Global Note or a Definitive Note Pursuant to Rule 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture,
1
the transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Rule 144A Global Note and/or the Definitive Note and in the Indenture and
the Securities Act.
2. |_| Check if Transferee will take delivery of a beneficial interest
in the Regulation S Global Note or a Definitive Note pursuant to Regulation S.
The Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and, accordingly, the Transferor hereby
further certifies that (i) the Transfer is not being made to a person in the
United States and (x) at the time the buy order was originated, the Transferee
was outside the United States or such Transferor and any Person acting on its
behalf reasonably believed and believes that the Transferee was outside the
United States or (y) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act and (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note and/or the Definitive
Note and in the Indenture and the Securities Act. If the Transfer of the
beneficial interest occurs prior to the expiration of the 40-day distribution
compliance period set forth in Regulation S, the transferred beneficial interest
will be held immediately thereafter through Euroclear or Clearstream.
3. |_| Check and complete if Transferee will take delivery of a
beneficial interest in a Definitive Note pursuant to any provision of the
Securities Act other than Rule 144A or Regulation S. The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial
interests in Restricted Global Notes and Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act and any applicable blue
sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) |_| such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act; or
(b) |_| such Transfer is being effected to the Company or a subsidiary
thereof; or
(c) |_| such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act; or
B-2
(d) |_| such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor
hereby further certifies that it has not engaged in any general solicitation
within the meaning of Regulation D under the Securities Act and the Transfer
complies with the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the requirements of
the exemption claimed, which certification is supported by (1) a certificate
executed by the Transferee in the form of Exhibit D to the Indenture and (2) an
Opinion of Counsel provided by the Transferor or the Transferee (a copy of which
the Transferor has attached to this certification), to the effect that such
Transfer is in compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Note and/or the Definitive Notes and in the Indenture and the Securities
Act.
4. |_| Check if Transferee will take delivery of a beneficial interest
in an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) |_| Check if Transfer is pursuant to Rule 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(b) |_| Check if Transfer is Pursuant to Regulation S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(c) |_| Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration
B-3
requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and
in compliance with the transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any State of the United States and (ii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will not be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuers.
______________________________________________
[Insert Name of Transferor]
By____________________________________________
Name:
Title:
Dated: ______________________________________
B-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) |_| a beneficial interest in the:
(i) |_| Rule 144A Global Note (CUSIP __________), or
(ii) |_| Regulation S Global Note (CUSIP _________), or
(b) |_| a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) |_| a beneficial interest in the:
(i) |_| Rule 144A Global Note (CUSIP __________), or
(ii) |_| Regulation S Global Note (CUSIP _________), or
(iii) |_| Unrestricted Global Note (CUSIP _________); or
(b) |_| a Restricted Definitive Note; or
(c) |_| an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-5
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 9.625% Senior Notes due 2009
(CUSIP ______________________)
Reference is hereby made to the Indenture, dated as of May 15, 2001 (the
"Indenture"), among Charter Communications Holdings, LLC (the "Company") and
Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
__________________________ (the "Owner") owns and proposes to exchange
the Note[s] or interest in such Note[s] specified herein, in the principal
amount of $____________________________ in such Note[s] or interests (the
"Exchange"). In connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests
in an Unrestricted Global Note
(a) |_| Check if Exchange is from beneficial interest in a Restricted
Global Note to beneficial interest in an Unrestricted Global Note. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the United States Securities Act of
1933, as amended (the "Securities Act"), (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the beneficial
interest in an
1
Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States. If the Exchange is
from beneficial interest in a Regulation S Global Note to beneficial interest in
an Unrestricted Global Note, the Owner further certifies that it is either (x) a
non-U.S. Person to whom Notes would be transferred in accordance with Regulation
S or (y) a U.S. Person who purchased Notes in a transaction that did not require
registration under the Securities Act.
(b) |_| Check if Exchange is from beneficial interest in a Restricted
Global Note to Unrestricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) |_| Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States. If the Exchange is from beneficial interest in a
Regulation S Global Note to an Unrestricted Definitive Note, the Owner further
certifies that it is either (x) a non-U.S. Person to whom Notes could be
transferred in accordance with Regulation S or (y) a U.S. Person who purchased
Notes in a transaction that did not require registration under the Securities
Act.
(d) |_| Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
C-2
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes
(a) |_| Check if Exchange is from beneficial interest in a Restricted
Global Note to Restricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. If the Exchange is from beneficial interest in a Regulation S
Global Note to a Restricted Definitive Note, the Owner further certifies that it
is either (x) a non-U.S. Person to whom Notes could be transferred in accordance
with Regulation S or (y) a U.S. Person who purchased Notes in a transaction that
did not require registration under the Securities Act. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the Restricted
Definitive Note issued will continue to be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Definitive Note and in the Indenture and the Securities Act.
(b) Check if Exchange is from Restricted Definitive Note to beneficial
interest in a Restricted Global Note. In connection with the Exchange of the
Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE]
|_| Rule 144A Global Note or |_| Regulation S Global Note with an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
C-3
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuers.
____________________________________________
[Insert Name of Transferor]
By__________________________________________
Name:
Title:
Dated: ______________________________________
C-4
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 9.625% Senior Notes due 2009
Reference is hereby made to the Indenture, dated as of May 15, 2001 (the
"Indenture"), among Charter Communications Holdings, LLC (the "Company") and
Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) |_| a beneficial interest in a Global Note, or
(b) |_| a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any
1
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and an Opinion
of Counsel in form reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or beneficial
interest therein, we will be required to furnish to you and the Issuers such
certifications, legal opinions and other information as you and the Issuers may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Issuers are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy to any interested party
in any administrative or legal proceedings or official inquiry with respect to
the matters covered hereby.
____________________________________________
[Insert Name of Transferor]
By__________________________________________
Name:
Title:
Dated: ____________________________________
D-2
EXECUTION COPY
================================================================================
CHARTER COMMUNICATIONS HOLDINGS, LLC
and
CHARTER COMMUNICATIONS HOLDINGS
CAPITAL CORPORATION,
as Issuers
and
BNY MIDWEST TRUST COMPANY,
as Trustee
INDENTURE
Dated as of May 15, 2001
9.625% Senior Notes due 2009
================================================================================
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
310(a)(1).............................................. 7.10
(a)(2)................................................. 7.10
(a)(3)................................................. N.A.
(a)(4)................................................. N.A.
(a)(5)................................................. 7.10
(b).................................................... 7.10
(c).................................................... N.A.
311(a)................................................. 7.11
(b).................................................... 7.11
(c).................................................... N.A.
312(a)................................................. 2.05
(b).................................................... 10.03
(c).................................................... 10.03
313(a)................................................. 7.06
(b)(1)................................................. 10.03
(b)(2)................................................. 7.07; 10.03
(c).................................................... 7.06; 10.02
(d).................................................... 7.06
314(a)................................................. 4.03; 10.02
(b).................................................... 10.02
(c)(1)................................................. 10.04
(c)(2)................................................. 10.04
(c)(3)................................................. N.A.
(d).................................................... N.A.
(e).................................................... 10.05
(f).................................................... N.A.
315(a)................................................. 7.01
(b).................................................... 7.05; 10.02
(c).................................................... 7.01
(d).................................................... 7.01
(e).................................................... 6.11
316(a) (last sentence)................................. 2.09
(a)(1)(A).............................................. 6.05
(a)(1)(B).............................................. 6.04
(a)(2)................................................. N.A.
(b).................................................... 6.07
(c).................................................... 2.12
317(a)(1).............................................. 6.08
(a)(2)................................................. 6.09
i
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
(b).................................................... 2.04
318(a)................................................. 10.01
(b).................................................... N.A.
(c).................................................... 10.01
N.A. means Not Applicable.
* This Cross-Reference Table is not part of the Indenture.
ii
Table of Contents
Page
----
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE.............................1
Section 1.01. Definitions.....................................................1
Section 1.02. Other Definitions..............................................25
Section 1.03. Incorporation by Reference of Trust Indenture Act..............25
Section 1.04. Rules of Construction..........................................26
ARTICLE 2 THE NOTES.............................................................26
Section 2.01. Form and Dating................................................26
Section 2.02. Execution and Authentication...................................27
Section 2.03. Registrar and Paying Agent.....................................28
Section 2.04. Paying Agent to Hold Money in Trust............................29
Section 2.05. Holder Lists...................................................29
Section 2.06. Transfer and Exchange..........................................29
Section 2.07. Replacement Notes..............................................43
Section 2.08. Outstanding Notes..............................................43
Section 2.09. Treasury Notes.................................................44
Section 2.10. Temporary Notes................................................44
Section 2.11. Cancellation...................................................44
Section 2.12. Defaulted Interest.............................................45
ARTICLE 3 REDEMPTION AND PREPAYMENT.............................................45
Section 3.01. Optional Redemption............................................45
Section 3.02. Mandatory Redemption...........................................45
Section 3.03. Offer to Purchase by Application of Excess Proceeds............45
ARTICLE 4 COVENANTS.............................................................47
Section 4.01. Payment of Notes...............................................47
Section 4.02. Maintenance of Office or Agency................................48
Section 4.03. Reports........................................................48
Section 4.04. Compliance Certificate.........................................49
Section 4.05. Taxes..........................................................50
Section 4.06. Stay, Extension and Usury Laws.................................50
Section 4.07. Restricted Payments............................................50
Section 4.08. Investments....................................................53
Section 4.09. Dividend and Other Payment Restrictions Affecting
Subsidiaries...................................................54
Section 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock.....56
Section 4.11. Limitation on Asset Sales......................................59
i
Section 4.12. Sale and Leaseback Transactions................................60
Section 4.13. Transactions with Affiliates...................................61
Section 4.14. Liens..........................................................62
Section 4.15. Existence......................................................62
Section 4.16. Repurchase at the Option of Holders upon a Change of Control...63
Section 4.17. Limitations on Issuances of Guarantees of Indebtedness.........64
Section 4.18. Payments for Consent...........................................65
Section 4.19. Application of Fall-Away Covenants.............................65
ARTICLE 5 SUCCESSORS............................................................66
Section 5.01. Merger, Consolidation, or Sale of Assets.......................66
Section 5.02. Successor Corporation Substituted..............................67
ARTICLE 6 DEFAULTS AND REMEDIES.................................................67
Section 6.01. Events of Default..............................................67
Section 6.02. Acceleration...................................................68
Section 6.03. Other Remedies.................................................69
Section 6.04. Waiver of Existing Defaults....................................69
Section 6.05. Control by Majority............................................69
Section 6.06. Limitation on Suits............................................70
Section 6.07. Rights of Holders of Notes to Receive Payment..................70
Section 6.08. Collection Suit by Trustee.....................................70
Section 6.09. Trustee May File Proofs of Claim...............................71
Section 6.10. Priorities.....................................................71
Section 6.11. Undertaking for Costs..........................................72
ARTICLE 7 TRUSTEE...............................................................72
Section 7.01. Duties of Trustee..............................................72
Section 7.02. Rights of Trustee..............................................73
Section 7.03. Individual Rights of Trustee...................................74
Section 7.04. Trustee's Disclaimer...........................................74
Section 7.05. Notice of Defaults.............................................75
Section 7.06. Reports by Trustee to Holders of the Notes.....................75
Section 7.07. Compensation and Indemnity.....................................75
Section 7.08. Replacement of Trustee.........................................76
Section 7.09. Successor Trustee by Merger, etc...............................77
Section 7.10. Eligibility; Disqualification..................................77
Section 7.11. Preferential Collection of Claims Against the Issuers..........78
ii
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE..............................78
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.......78
Section 8.02. Legal Defeasance and Discharge.................................78
Section 8.03. Covenant Defeasance............................................79
Section 8.04. Conditions to Legal or Covenant Defeasance.....................79
Section 8.05. Deposited Money and Government Securities to Be Held in
Trust; Other Miscellaneous Provisions..........................81
Section 8.06. Repayment to Issuers...........................................82
Section 8.07. Reinstatement..................................................82
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER......................................82
Section 9.01. Without Consent of Holders of Notes............................82
Section 9.02. With Consent of Holders of Notes...............................83
Section 9.03. Compliance with Trust Indenture Act............................85
Section 9.04. Revocation and Effect of Consents..............................85
Section 9.05. Notation on or Exchange of Notes...............................85
Section 9.06. Trustee to Sign Amendments, etc................................85
ARTICLE 10 MISCELLANEOUS.........................................................86
Section 10.01.Trust Indenture Act Controls...................................86
Section 10.02.Notices........................................................86
Section 10.03.Communication by Holders of Notes with Other Holders of
Notes..........................................................87
Section 10.04.Certificate and Opinion as to Conditions Precedent.............87
Section 10.05.Statements Required in Certificate or Opinion..................88
Section 10.06.Rules by Trustee and Agents....................................88
Section 10.07.No Personal Liability of Directors, Officers, Employees,
Members and Stockholders.......................................89
Section 10.08.Governing Law..................................................88
Section 10.09.No Adverse Interpretation of Other Agreements..................89
Section 10.10.Successors.....................................................89
Section 10.11.Severability...................................................89
Section 10.12.Counterpart Originals..........................................89
Section 10.13.Table of Contents, Headings, etc...............................89
ARTICLE 11 SATISFACTION AND DISCHARGE............................................89
Section 11.01.Satisfaction and Discharge of Indenture........................89
Section 11.02.Application of Trust Money.....................................90
iii
EXHIBIT A...........................................................................A-1
EXHIBIT B...........................................................................B-1
EXHIBIT C...........................................................................C-1
EXHIBIT D...........................................................................D-1
EXECUTION COPY
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
$350,000,000 9.625% Senior Notes due 2009
Exchange and Registration Rights Agreement
------------------------------------------
May 15, 2001
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
JP Morgan, a Division of Chase Securities Inc.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns Corp.
Dresdner Kleinwort Wasserstein Securities LLC
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Charter Communications Holdings, LLC, a Delaware limited liability
company (the "Company"), and Charter Communications Holdings Capital
Corporation, a Delaware corporation ("Charter Capital" and, together with the
Company, the "Issuers"), propose, subject to the terms and conditions stated
herein, to issue and sell to the Purchasers (as defined herein) upon the terms
set forth in the Purchase Agreement (as defined herein) their $350,000,000
aggregate principal amount of 9.625% Senior Notes due 2009 (the "Notes"). As an
inducement to the Purchasers to enter into the Purchase Agreement and in
satisfaction of a condition to the obligations of the Purchasers thereunder, the
Issuers agree with the Purchasers for the benefit of holders (as defined herein)
from time to time of the Registrable Securities (as defined herein) as follows:
1. Certain Definitions. For purposes of this Exchange and Registration
Rights Agreement, the following terms shall have the following respective
meanings:
"Base Interest" shall mean the interest that would otherwise accrue on
the Notes under the terms thereof and the Indenture, without giving effect to
the provisions of this Exchange and Registration Rights Agreement.
The term "broker-dealer" shall mean any broker or dealer registered with
the Commission under the Exchange Act.
"Closing Date" shall mean the date on which the Notes are initially
issued.
"Commission" shall mean the United States Securities and Exchange
Commission, or any other federal agency at the time administering the Exchange
Act or the Securities Act, whichever is the relevant statute for the particular
purpose.
"Effective Time," in the case of (i) an Exchange Offer Registration,
shall mean the time and date as of which the Commission declares the Exchange
Offer Registration Statement effective or as of which the Exchange Offer
Registration Statement otherwise becomes effective and (ii) a Shelf
Registration, shall mean the time and date as of which the Commission declares
the Shelf Registration Statement effective or as of which the Shelf Registration
Statement otherwise becomes effective.
"Electing Holder" shall mean any holder of Registrable Securities that
has returned a completed and signed Notice and Questionnaire to the Issuers in
accordance with Section 3(d)(ii) or 3(d)(iii) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, or any
successor thereto, as the same shall be amended from time to time.
"Exchange Notes" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Exchange Offer" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Exchange Offer Registration" shall have the meaning assigned thereto in
Section 3(c) hereof.
"Exchange Offer Registration Statement" shall have the meaning assigned
thereto in Section 2(a) hereof.
The term "holder" shall mean each of the Purchasers and other persons
who acquire Registrable Securities from time to time (including any successors
or assigns), in each case for so long as such person is a registered holder of
any Registrable Securities.
2
"Indenture" shall mean the Indenture governing the Notes, dated as of
May 15, 2001 between the Issuers and BNY Midwest Trust Company, as Trustee, as
the same shall be amended from time to time.
"Notes" shall mean, collectively, the 9.625% Senior Notes due 2009 of
the Issuers to be issued and sold to the Purchasers, and Notes issued in
exchange therefor or in lieu thereof, pursuant to the Indenture.
"Notice and Questionnaire" means a Notice of Registration Statement and
Selling Securityholder Questionnaire substantially in the form of Exhibit A
hereto.
The term "person" shall mean a corporation, association, partnership,
organization, business, individual, government or political subdivision thereof
or governmental agency.
"Purchase Agreement" shall mean the Purchase Agreement, dated as of May
10, 2001, between the Purchasers and the Issuers relating to the Notes.
"Purchasers" shall mean the Purchasers named in Schedule I to the
Purchase Agreement.
"Registrable Securities" shall mean the Notes; provided, however, that a
Note shall cease to be a Registrable Security when (i) in the circumstances
contemplated by Section 2(a) hereof, such Note has been exchanged for an
Exchange Note in an Exchange Offer as contemplated in Section 2(a) hereof
(provided that any Exchange Note that, pursuant to the last two sentences of
Section 2(a), is included in a prospectus for use in connection with resales by
broker-dealers shall be deemed to be a Registrable Security with respect to
Sections 5, 6 and 9 hereof until resale of such Registrable Security has been
effected within the 180-day period referred to in Section 2(a)(y)); (ii) in the
circumstances contemplated by Section 2(b) hereof, a Shelf Registration
Statement registering such Note under the Securities Act has been declared or
becomes effective and such Note has been sold or otherwise transferred by the
holder thereof pursuant to and in a manner contemplated by such effective Shelf
Registration Statement; (iii) such Note is sold pursuant to Rule 144 under
circumstances in which any legend borne by such Note relating to restrictions on
transferability thereof, under the Securities Act or otherwise, is removed by
the Issuers or pursuant to the Indenture; (iv) such Security is eligible to be
sold pursuant to paragraph (k) of Rule 144; or (v) such Security shall cease to
be outstanding.
"Registration Default" shall have the meaning assigned thereto in
Section 2(c) hereof.
"Registration Expenses" shall have the meaning assigned thereto in
Section 4 hereof.
3
"Resale Period" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Restricted Holder" shall mean (i) a holder that is an affiliate of the
Issuers within the meaning of Rule 405, (ii) a holder who acquires Exchange
Notes outside the ordinary course of such holder's business, (iii) a holder who
has arrangements or understandings with any person to participate in the
Exchange Offer for the purpose of distributing Exchange Notes and (iv) a holder
that is a broker-dealer, but only with respect to Exchange Notes received by
such broker-dealer pursuant to an Exchange Offer in exchange for Registrable
Securities acquired by the broker-dealer directly from the Issuers.
"Rule 144," "Rule 405" and "Rule 415" shall mean, in each case, such
rule promulgated under the Securities Act (or any successor provision), as the
same shall be amended from time to time.
"Securities Act" shall mean the Securities Act of 1933, or any successor
thereto, as the same shall be amended from time to time.
"Shelf Registration" shall have the meaning assigned thereto in Section
2(b) hereof.
"Shelf Registration Statement" shall have the meaning assigned thereto
in Section 2(b) hereof.
"Special Interest" shall have the meaning assigned thereto in Section
2(c) hereof.
"subsidiaries" shall mean subsidiaries which would be "significant
subsidiaries" as defined in Rule 1-02(w) of Regulation S-X under the Exchange
Act.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, or any
successor thereto, and the rules, regulations and forms promulgated thereunder,
all as the same shall be amended from time to time.
Unless the context otherwise requires, any reference herein to a
"Section" or "clause" refers to a Section or clause, as the case may be, of this
Exchange and Registration Rights Agreement, and the words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Exchange and
Registration Rights Agreement as a whole and not to any particular Section or
other subdivision.
2. Registration Under the Securities Act.
(a) Except as set forth in Section 2(b) below, the Issuers agree to file
under the Securities Act, as soon as practicable, but no later than 120 days
after the Closing Date, a registration statement relating to an offer to
exchange (such registration
4
statement, the "Exchange Offer Registration Statement", and such offer, the
"Exchange Offer") any and all of the Notes for a like aggregate principal amount
of notes issued by the Issuers, which notes are substantially identical in all
material respects to the Notes (and are entitled to the benefits of a trust
indenture which has terms identical in all material respects to the Indenture or
is the Indenture and which has been qualified under the Trust Indenture Act),
except that they have been registered pursuant to an effective registration
statement under the Securities Act and do not contain provisions for the
additional interest contemplated in Section 2(c) below (such notes hereinafter
called "Exchange Notes"). The Issuers agree to use their reasonable best efforts
to cause the Exchange Offer Registration Statement to become or be declared
effective under the Securities Act as soon as practicable, but no later than 180
days after the Closing Date. The Exchange Offer will be registered under the
Securities Act on the appropriate form and will comply with all applicable
tender offer rules and regulations under the Exchange Act. The Issuers further
agree to use their reasonable best efforts to complete the Exchange Offer
promptly, but no later than 30 business days or longer, if required by the
federal securities laws, after such registration statement has become effective,
hold the Exchange Offer open for at least 30 days and exchange Exchange Notes
for all Registrable Securities that have been properly tendered and not
withdrawn on or prior to the expiration of the Exchange Offer. The Exchange
Offer will be deemed to have been "completed" only if the Exchange Notes
received by holders, other than Restricted Holders, in the Exchange Offer in
exchange for Registrable Securities are, upon receipt, transferable by each such
holder without restriction under the Securities Act and the Exchange Act and
without material restrictions under the blue sky or securities laws of a
substantial majority of the States of the United States of America. The Exchange
Offer shall be deemed to have been completed upon the earlier to occur of (i)
the Issuers having exchanged the Exchange Notes for all outstanding Registrable
Securities pursuant to the Exchange Offer and (ii) the Issuers having exchanged,
pursuant to the Exchange Offer, Exchange Notes for all Registrable Securities
that have been properly tendered and not withdrawn before the expiration of the
Exchange Offer, which shall be on a date that is at least 30 business days
following the commencement of the Exchange Offer. The Issuers agree (x) to
include in the Exchange Offer Registration Statement a prospectus for use in any
resales by any holder of Exchange Notes that is a broker-dealer and (y) to keep
such Exchange Offer Registration Statement effective for a period (the "Resale
Period") beginning when Exchange Notes are first issued in the Exchange Offer
and ending upon the earlier of the expiration of the 180th day after the
Exchange Offer has been completed or such time as such broker-dealers no longer
own any Registrable Securities. With respect to such Exchange Offer Registration
Statement, such holders shall have the benefit of the rights of indemnification
and contribution set forth in Sections 6(a), (c), (d) and (e) hereof.
(b) If (i) on or prior to the time the Exchange Offer is completed
existing law or Commission policy or interpretations are changed such that the
Exchange Notes received by holders, other than Restricted Holders, in the
Exchange Offer in exchange for
5
Registrable Securities are not or would not be, upon receipt, transferable by
each such holder without restriction under the Securities Act, (ii) the Exchange
Offer has not been completed within 210 days following the Closing Date or (iii)
the Exchange Offer is not available to any holder of the Notes, the Issuers
shall, in lieu of (or, in the case of clause (iii), in addition to) conducting
the Exchange Offer contemplated by Section 2(a), file under the Securities Act
on or prior to 30 business days after the time such obligation to file arises, a
"shelf" registration statement providing for the registration of, and the sale
on a continuous or delayed basis by the holders of, all of the Registrable
Securities, pursuant to Rule 415 or any similar rule that may be adopted by the
Commission (such filing, the "Shelf Registration" and such registration
statement, the "Shelf Registration Statement"). The Issuers agree to use their
reasonable best efforts (x) to cause the Shelf Registration Statement to become
or be declared effective by the Commission no later than 90 days after such
obligation to file arises and to keep such Shelf Registration Statement
continuously effective for a period ending on the earlier of (i) the second
anniversary of the Effective Time or (ii) such time as there are no longer any
Registrable Securities outstanding; provided, however, that no holder shall be
entitled to be named as a selling securityholder in the Shelf Registration
Statement or to use the prospectus forming a part thereof for resales of
Registrable Securities unless such holder is an Electing Holder, and (y) after
the Effective Time of the Shelf Registration Statement, promptly upon the
request of any holder of Registrable Securities that is not then an Electing
Holder, to take any action reasonably necessary to enable such holder to use the
prospectus forming a part thereof for resales of Registrable Securities,
including, without limitation, any action necessary to identify such holder as a
selling securityholder in the Shelf Registration Statement, provided, however,
that nothing in this clause (y) shall relieve any such holder of the obligation
to return a completed and signed Notice and Questionnaire to the Issuers in
accordance with Section 3(d)(iii) hereof. The Issuers further agree to
supplement or make amendments to the Shelf Registration Statement, as and when
required by the rules, regulations or instructions applicable to the
registration form used by the Issuers for such Shelf Registration Statement or
by the Securities Act or rules and regulations thereunder for shelf
registration, and the Issuers agree to furnish to each Electing Holder copies of
any such supplement or amendment prior to its being used or promptly following
its filing with the Commission.
(c) In the event that (i) the Issuers have not filed the Exchange Offer
Registration Statement or Shelf Registration Statement on or before the date on
which such registration statement is required to be filed pursuant to Section
2(a) or 2(b), respectively, or (ii) such Exchange Offer Registration Statement
or Shelf Registration Statement has not become effective or been declared
effective by the Commission on or before the date on which such registration
statement is required to become or be declared effective pursuant to Section
2(a) or 2(b), respectively, or (iii) the Exchange Offer has not been completed
within 30 business days after the initial effective date of the Exchange Offer
Registration Statement relating to the Exchange Offer (if the Exchange Offer is
then required to be made) or (iv) any Exchange Offer Registration Statement or
Shelf
6
Registration Statement required by Section 2(a) or 2(b) hereof is filed and
becomes or is declared effective but shall thereafter either be withdrawn by the
Issuers or shall become subject to an effective stop order issued pursuant to
Section 8(d) of the Securities Act suspending the effectiveness of such
registration statement (except as specifically permitted herein) without being
succeeded immediately by an additional registration statement filed and declared
effective (each such event referred to in clauses (i) through (iv), a
"Registration Default" and each period during which a Registration Default has
occurred and is continuing, a "Registration Default Period"), then, as
liquidated damages for such Registration Default, subject to the provisions of
Section 9(b), special interest ("Special Interest"), in addition to the Base
Interest, shall accrue on the aggregate principal amount of the outstanding
Notes at a per annum rate of 0.25% for the first 90 days of the Registration
Default Period, at a per annum rate of 0.50% for the second 90 days of the
Registration Default Period, at a per annum rate of 0.75% for the third 90 days
of the Registration Default Period and at a per annum rate of 1.0% thereafter
for the remaining portion of the Registration Default Period. All accrued
Special Interest shall be paid in cash by the Issuers on each Interest Payment
Date (as defined in the Indenture). Notwithstanding the foregoing and anything
in this Agreement to the contrary, in the case of an event referred to in clause
(ii) above, a "Registration Default" shall be deemed not to have occurred so
long as the Issuers, in their sole reasonable judgment, are using and continuing
to use their reasonable best efforts to cause such Exchange Offer Registration
Statement or Shelf Registration Statement, as the case may be, to become or be
declared effective.
(d) The Issuers shall use their reasonable best efforts to take all
actions necessary or advisable to be taken by them to ensure that the
transactions contemplated herein are effected as so contemplated in Section 2(a)
or 2(b) hereof.
(e) Any reference herein to a registration statement as of any time
shall be deemed to include any document incorporated, or deemed to be
incorporated, therein by reference as of such time and any reference herein to
any post-effective amendment to a registration statement as of any time shall be
deemed to include any document incorporated, or deemed to be incorporated,
therein by reference as of such time.
3. Registration Procedures.
If the Issuers file a registration statement pursuant to Section 2(a) or
Section 2(b), the following provisions shall apply:
(a) At or before the Effective Time of the Exchange Offer or the Shelf
Registration, as the case may be, the Issuers shall cause the Indenture to be
qualified under the Trust Indenture Act of 1939.
7
(b) In the event that such qualification would require the appointment
of a new trustee under the Indenture, the Issuers shall appoint a new trustee
thereunder pursuant to the applicable provisions of the Indenture.
(c) In connection with the Issuers' obligations with respect to the
registration of Exchange Notes as contemplated by Section 2(a) (the "Exchange
Offer Registration"), if applicable, the Issuers shall, as soon as practicable
(or as otherwise specified):
(i) prepare and file with the Commission, as soon as practicable but
no later than 120 days after the Closing Date, an Exchange Offer
Registration Statement on any form which may be utilized by the Issuers
and which shall permit the Exchange Offer and resales of Exchange Notes
by broker-dealers during the Resale Period to be effected as
contemplated by Section 2(a), and use their reasonable best efforts to
cause such Exchange Offer Registration Statement to become or be
declared effective as soon as practicable thereafter, but no later than
180 days after the Closing Date;
(ii) as soon as practicable prepare and file with the Commission
such amendments and supplements to such Exchange Offer Registration
Statement and the prospectus included therein as may be necessary to
effect and maintain the effectiveness of such Exchange Offer
Registration Statement for the periods and purposes contemplated in
Section 2(a) hereof and as may be required by the applicable rules and
regulations of the Commission and the instructions applicable to the
form of such Exchange Offer Registration Statement, and promptly provide
each broker-dealer holding Exchange Notes with such number of copies of
the prospectus included therein (as then amended or supplemented), in
conformity in all material respects with the requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations
of the Commission thereunder, as such broker-dealer reasonably may
request prior to the expiration of the Resale Period, for use in
connection with resales of Exchange Notes;
(iii) promptly notify each broker-dealer that has requested or
received copies of the prospectus included in such registration
statement, and confirm such advice in writing, (A) when such Exchange
Offer Registration Statement or the prospectus included therein or any
prospectus amendment or supplement or post-effective amendment has been
filed, and, with respect to such Exchange Offer Registration Statement
or any post-effective amendment, when the same has become effective, (B)
of any comments by the Commission and by the blue sky or securities
commissioner or regulator of any state with respect thereto, or any
request by the Commission for amendments or supplements to such Exchange
Offer Registration Statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such Exchange Offer Registration
Statement or the initiation or, to the knowledge
8
of the Issuers, threatening of any proceedings for that purpose, (D) if
at any time the representations and warranties of the Issuers
contemplated by Section 5 hereof cease to be true and correct in all
material respects, (E) of the receipt by the Issuers of any notification
with respect to the suspension of the qualification of the Exchange
Notes for sale in any jurisdiction or the initiation or, to the
knowledge of the Issuers, threatening of any proceeding for such
purpose, or (F) at any time during the Resale Period when a prospectus
is required to be delivered under the Securities Act, that such Exchange
Offer Registration Statement, prospectus, prospectus amendment or
supplement or post-effective amendment does not conform in all material
respects to the applicable requirements of the Securities Act and the
Trust Indenture Act and the rules and regulations of the Commission
thereunder, or contains an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances
then existing;
(iv) in the event that the Issuers would be required, pursuant to
Section 3(e)(iii)(F) above, to notify any broker-dealers holding
Exchange Notes, the Issuers shall prepare and furnish to each such
holder a reasonable number of copies of a prospectus supplemented or
amended so that, as thereafter delivered to purchasers of such Exchange
Notes during the Resale Period, such prospectus conforms in all material
respects to the applicable requirements of the Securities Act and the
Trust Indenture Act and the rules and regulations of the Commission
thereunder and shall not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;
(v) use their reasonable best efforts to obtain the withdrawal of
any order suspending the effectiveness of such Exchange Offer
Registration Statement or any post-effective amendment thereto as soon
as practicable;
(vi) use their reasonable best efforts to (A) register or qualify
the Exchange Notes under the securities laws or blue sky laws of such
jurisdictions as are contemplated by Section 2(a) no later than the
commencement of the Exchange Offer, (B) keep such registrations or
qualifications in effect and comply with such laws so as to permit the
continuance of offers, sales and dealings therein in such jurisdictions
until the expiration of the Resale Period and (C) take any and all other
actions as may be reasonably necessary or advisable to enable each
broker-dealer holding Exchange Notes to consummate the disposition
thereof in such jurisdictions; provided, however, that neither of the
Issuers shall be required for any such purpose to (1) qualify as a
foreign corporation or limited liability company, as the case may be, in
any jurisdiction wherein it would not otherwise be required to qualify
but for the requirements of this Section 3(c)(vi), (2) consent to
general service of process in any such jurisdiction or (3) make any
9
changes to its certificate of incorporation or by-laws (or other
organizational document) or any agreement between it and holders of its
ownership interests;
(vii) use their reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal,
state or local, which may be required to effect the Exchange Offer
Registration, the Exchange Offer and the offering and sale of Exchange
Notes by broker-dealers during the Resale Period;
(viii) provide a CUSIP number for all Exchange Notes, not later than
the applicable Effective Time;
(ix) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as soon
as practicable but no later than eighteen months after the effective
date of such Exchange Offer Registration Statement, an earning statement
of the Company and its subsidiaries complying with Section 11(a) of the
Securities Act (including, at the option of the Company, Rule 158
thereunder).
(d) In connection with the Issuers' obligations with respect to the
Shelf Registration, if applicable, the Issuers shall, as soon as practicable (or
as otherwise specified):
(i) prepare and file with the Commission within the time periods
specified in Section 2(b), a Shelf Registration Statement on any form
which may be utilized by the Issuers and which shall register all of the
Registrable Securities for resale by the holders thereof in accordance
with such method or methods of disposition as may be specified by such
of the holders as, from time to time, may be Electing Holders and use
their reasonable best efforts to cause such Shelf Registration Statement
to become or be declared effective within the time periods specified in
Section 2(b);
(ii) not less than 30 calendar days prior to the Effective Time of
the Shelf Registration Statement, mail the Notice and Questionnaire to
the holders of Registrable Securities; no holder shall be entitled to be
named as a selling securityholder in the Shelf Registration Statement as
of the Effective Time, and no holder shall be entitled to use the
prospectus forming a part thereof for resales of Registrable Securities
at any time, unless such holder has returned a completed and signed
Notice and Questionnaire to the Issuers by the deadline for response set
forth therein; provided, however, holders of Registrable Securities
shall have at least 28 calendar days from the date on which the Notice
and Questionnaire is first mailed to such holders to return a completed
and signed Notice and Questionnaire to the Issuers;
10
(iii) after the Effective Time of the Shelf Registration Statement,
upon the request of any holder of Registrable Securities that is not
then an Electing Holder, promptly send a Notice and Questionnaire to
such holder; provided that the Issuers shall not be required to take any
action to name such holder as a selling securityholder in the Shelf
Registration Statement or to enable such holder to use the prospectus
forming a part thereof for resales of Registrable Securities until such
holder has returned a completed and signed Notice and Questionnaire to
the Issuers;
(iv) as soon as practicable prepare and file with the Commission
such amendments and supplements to such Shelf Registration Statement and
the prospectus included therein as may be necessary to effect and
maintain the effectiveness of such Shelf Registration Statement for the
period specified in Section 2(b) thereof and as may be required by the
applicable rules and regulations of the Commission and the instructions
applicable to the form of such Shelf Registration Statement, and furnish
to the Electing Holders copies of any such supplement or amendment
simultaneously with or prior to its being used or filed with the
Commission;
(v) comply with the provisions of the Securities Act with respect to
the disposition of all of the Registrable Securities covered by such
Shelf Registration Statement in accordance with the intended methods of
disposition by the Electing Holders provided for in such Shelf
Registration Statement;
(vi) provide (A) the Electing Holders, (B) the underwriters (which
term, for purposes of this Exchange and Registration Rights Agreement,
shall include a person deemed to be an underwriter within the meaning of
Section 2(a)(11) of the Securities Act), if any, thereof, (C) any sales
or placement agent therefor, (D) counsel for any such underwriter or
agent and (E) not more than one counsel for all the Electing Holders the
opportunity to participate in the preparation of such Shelf Registration
Statement, each prospectus included therein or filed with the Commission
and each amendment or supplement thereto;
(vii) for a reasonable period prior to the filing of such Shelf
Registration Statement, and throughout the period specified in Section
2(b), make available at reasonable times at the Issuers' principal place
of business or such other reasonable place for inspection by the persons
referred to in Section 3(d)(vi) who shall certify to the Issuers that
they have a current intention to sell the Registrable Securities
pursuant to the Shelf Registration such financial and other relevant
information and books and records of the Issuers, and cause the
officers, employees, counsel and independent certified public
accountants of the Issuers to respond to such inquiries, as shall be
reasonably necessary, in the judgment of the respective counsel referred
to in such Section, to conduct a reasonable
11
investigation within the meaning of Section 11 of the Securities Act;
provided, however, that each such party shall be required to maintain in
confidence and not to disclose to any other person any information or
records reasonably designated by the Issuers as being confidential,
until such time as (A) such information becomes a matter of public
record (whether by virtue of its inclusion in such registration
statement or otherwise, except as a result of a breach of this or any
other obligation of confidentiality to the Issuers), or (B) such person
shall be required so to disclose such information pursuant to a subpoena
or order of any court or other governmental agency or body having
jurisdiction over the matter (subject to the requirements of such order,
and only after such person shall have given the Issuers prompt prior
written notice of such requirement), or (C) such information is required
to be set forth in such Shelf Registration Statement or the prospectus
included therein or in an amendment to such Shelf Registration Statement
or an amendment or supplement to such prospectus in order that such
Shelf Registration Statement, prospectus, amendment or supplement, as
the case may be, complies with applicable requirements of the federal
securities laws and the rules and regulations of the Commission and does
not contain an untrue statement of a material fact or omit to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances
then existing;
(viii) promptly notify each of the Electing Holders, any sales or
placement agent therefor and any underwriter thereof (which notification
may be made through any managing underwriter that is a representative of
such underwriter for such purpose) and confirm such advice in writing,
(A) when such Shelf Registration Statement or the prospectus included
therein or any prospectus amendment or supplement or post-effective
amendment has been filed, and, with respect to such Shelf Registration
Statement or any post-effective amendment, when the same has become
effective, (B) of any comments by the Commission and by the blue sky or
securities commissioner or regulator of any state with respect thereto,
or any request by the Commission for amendments or supplements to such
Shelf Registration Statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such Shelf Registration Statement or the
initiation or, to the knowledge of the Issuers, threatening of any
proceedings for that purpose, (D) if at any time the representations and
warranties of the Issuers contemplated by Section 3(d)(xvii) or Section
5 hereof cease to be true and correct in all material respects, (E) of
the receipt by the Issuers of any notification with respect to the
suspension of the qualification of the Registrable Securities for sale
in any jurisdiction or the initiation or, to the knowledge of the
Issuers, threatening of any proceeding for such purpose, or (F) if at
any time when a prospectus is required to be delivered under the
Securities Act, that such Shelf Registration Statement, prospectus,
prospectus amendment or supplement or post-effective amendment
12
does not conform in all material respects to the applicable requirements
of the Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission thereunder, or contains an untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing;
(ix) use their reasonable best efforts to obtain the withdrawal of
any order suspending the effectiveness of such registration statement or
any post-effective amendment thereto as soon as practicable;
(x) if requested by any managing underwriter or underwriters, any
placement or sales agent or any Electing Holder, promptly incorporate in
a prospectus supplement or post-effective amendment such information as
is required by the applicable rules and regulations of the Commission,
and as such managing underwriter or underwriters, such agent or such
Electing Holder specifies should be included therein relating to the
terms of the sale of such Registrable Securities, including information
(i) with respect to the principal amount of Registrable Securities being
sold by such Electing Holder or agent or to any underwriters, the name
and description of such Electing Holder, agent or underwriter, the
offering price of such Registrable Securities, and any discount,
commission or other compensation payable in respect thereof and the
purchase price being paid therefor by such underwriters and (ii) with
respect to any other material terms of the offering of the Registrable
Securities to be sold by such Electing Holder or agent or to such
underwriters; and make all required filings of such prospectus
supplement or post-effective amendment upon notification of the matters
to be incorporated in such prospectus supplement or post-effective
amendment;
(xi) furnish to each Electing Holder, each placement or sales agent,
if any, therefor, each underwriter, if any, thereof and the respective
counsel referred to in Section 3(d)(vi) hereof an executed copy (or, in
the case of an Electing Holder, a conformed copy) of such Shelf
Registration Statement, each such amendment and supplement thereto (in
each case including all exhibits thereto (in the case of an Electing
Holder of Registrable Securities, upon request) and documents
incorporated by reference therein) and such number of copies of such
Shelf Registration Statement (excluding exhibits thereto and documents
incorporated by reference therein unless specifically so requested by
such Electing Holder, agent or underwriter, as the case may be) and of
the prospectus included in such Shelf Registration Statement (including
each preliminary prospectus and any summary prospectus), in conformity
in all material respects with the applicable requirements of the
Securities Act and the Trust Indenture Act, and the rules and
regulations of the Commission thereunder, and such other documents, as
such Electing Holder, agent, if any, and underwriter, if any, may
13
reasonably request in order to facilitate the offering and disposition
of the Registrable Securities owned by such Electing Holder, offered or
sold by such agent or underwritten by such underwriter and to permit
such Electing Holder, agent and underwriter to satisfy the prospectus
delivery requirements of the Securities Act; and the Issuers hereby
consent to the use of such prospectus (including such preliminary and
summary prospectus) and any amendment or supplement thereto by each such
Electing Holder and by any such agent and underwriter, in each case in
the form most recently provided to such person by the Issuers, in
connection with the offering and sale of the Registrable Securities
covered by the prospectus (including such preliminary and summary
prospectus) or any supplement or amendment thereto;
(xii) use their reasonable best efforts to (A) register or qualify
the Registrable Securities to be included in such Shelf Registration
Statement under such securities laws or blue sky laws of such
jurisdictions as any Electing Holder and each placement or sales agent,
if any, therefor and underwriter, if any, thereof shall reasonably
request, (B) keep such registrations or qualifications in effect and
comply with such laws so as to permit the continuance of offers, sales
and dealings therein in such jurisdictions during the period the Shelf
Registration is required to remain effective under Section 2(b) above
and for so long as may be necessary to enable any such Electing Holder,
agent or underwriter to complete its distribution of Notes pursuant to
such Shelf Registration Statement and (C) take any and all other actions
as may be reasonably necessary or advisable to enable each such Electing
Holder, agent, if any, and underwriter, if any, to consummate the
disposition in such jurisdictions of such Registrable Securities;
provided, however, that none of the Issuers shall be required for any
such purpose to (1) qualify as a foreign corporation or limited
liability company, as the case may be, in any jurisdiction wherein it
would not otherwise be required to qualify but for the requirements of
this Section 3(d)(xii), (2) consent to general service of process in any
such jurisdiction or (3) make any changes to its certificate of
incorporation or by-laws (or other organizational document) or any
agreement between it and holders of its ownership interests;
(xiii) use their reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal,
state or local, which may be required to effect the Shelf Registration
or the offering or sale in connection therewith or to enable the selling
holder or holders to offer, or to consummate the disposition of, their
Registrable Securities;
(xiv) unless any Registrable Securities shall be in book-entry only
form, cooperate with the Electing Holders and the managing underwriters,
if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold, which
certificates, if so required by any
14
securities exchange upon which any Registrable Securities are listed,
shall be penned, lithographed or engraved, or produced by any
combination of such methods, on steel engraved borders, and which
certificates shall not bear any restrictive legends; and, in the case of
an underwritten offering, enable such Registrable Securities to be in
such denominations and registered in such names as the managing
underwriters may request at least two business days prior to any sale of
the Registrable Securities;
(xv) provide a CUSIP number for all Registrable Securities, not
later than the applicable Effective Time;
(xvi) enter into one or more underwriting agreements, engagement
letters, agency agreements, "best efforts" underwriting agreements or
similar agreements, as appropriate, including customary provisions
relating to indemnification and contribution, and take such other
actions in connection therewith as any Electing Holders of at least 20%
in aggregate principal amount of the Registrable Securities at the time
outstanding shall request in order to expedite or facilitate the
disposition of such Registrable Securities;
(xvii) whether or not an agreement of the type referred to in
Section 3(d)(xvi) hereof is entered into, and whether or not any portion
of the offering contemplated by the Shelf Registration is an
underwritten offering or is made through a placement or sales agent or
any other entity, (A) make such representations and warranties to the
Electing Holders and the placement or sales agent, if any, therefor and
the underwriters, if any, thereof in form, substance and scope as are
customarily made in connection with an offering of debt securities
pursuant to any appropriate agreement or to a registration statement
filed on the form applicable to the Shelf Registration; (B) obtain an
opinion of counsel to the Issuers in customary form, subject to
customary limitations, assumptions and exclusions, and covering such
matters, of the type customarily covered by such an opinion, as the
managing underwriters, if any, or as any Electing Holders of at least
20% in aggregate principal amount of the Registrable Securities at the
time outstanding may reasonably request, addressed to such Electing
Holder or Electing Holders and the placement or sales agent, if any,
therefor and the underwriters, if any, thereof and dated the date of the
Effective Time of such Shelf Registration Statement (and if such Shelf
Registration Statement contemplates an underwritten offering of a part
or all of the Registrable Securities, dated the date of the closing
under the underwriting agreement relating thereto) (it being agreed that
the matters to be covered by such opinion shall include the matters set
forth in paragraphs (b) and (d) of Section 7 of the Purchase Agreement
to the extent applicable to an offering of this type); (C) obtain a
"cold comfort" letter or letters from the independent certified public
accountants of the Issuers addressed to the selling Electing Holders,
the placement or sales agent, if
15
any, therefor or the underwriters, if any, thereof, dated (i) the
effective date of such Shelf Registration Statement and (ii) the
effective date of any prospectus supplement to the prospectus included
in such Shelf Registration Statement or post-effective amendment to such
Shelf Registration Statement which includes unaudited or audited
financial statements as of a date or for a period subsequent to that of
the latest such statements included in such prospectus (and, if such
Shelf Registration Statement contemplates an underwritten offering
pursuant to any prospectus supplement to the prospectus included in such
Shelf Registration Statement or post-effective amendment to such Shelf
Registration Statement which includes unaudited or audited financial
statements as of a date or for a period subsequent to that of the latest
such statements included in such prospectus, dated the date of the
closing under the underwriting agreement relating thereto), such letter
or letters to be in customary form and covering such matters of the type
customarily covered by letters of such type; (D) deliver such documents
and certificates, including officers' certificates, as may be reasonably
requested by any Electing Holders of at least 20% in aggregate principal
amount of the Registrable Securities at the time outstanding or the
placement or sales agent, if any, therefor and the managing
underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or
those contained in Section 5(a) hereof and the compliance with or
satisfaction of any agreements or conditions contained in the
underwriting agreement or other similar agreement entered into by the
Issuers pursuant to Section 3(d)(xvi); and (E) undertake such
obligations relating to expense reimbursement, indemnification and
contribution as are provided in Section 6 hereof;
(xviii) notify in writing each holder of Registrable Securities of
any proposal by the Issuers to amend or waive any provision of this
Exchange and Registration Rights Agreement pursuant to Section 9(h)
hereof and of any amendment or waiver effected pursuant thereto, each of
which notices shall contain the substance of the amendment or waiver
proposed or effected, as the case may be;
(xix) in the event that any broker-dealer registered under the
Exchange Act shall underwrite any Registrable Securities or participate
as a member of an underwriting syndicate or selling group or "assist in
the distribution" (within the meaning of the Conduct Rules (the "Conduct
Rules") of the National Association of Securities Dealers, Inc. ("NASD")
or any successor thereto, as amended from time to time) thereof, whether
as a holder of such Registrable Securities or as an underwriter, a
placement or sales agent or a broker or dealer in respect thereof, or
otherwise, assist such broker-dealer in complying with the requirements
of such Conduct Rules, including by (A) if such Conduct Rules shall so
require, engaging a "qualified independent underwriter" (as defined in
such Conduct Rules) to
16
participate in the preparation of the Shelf Registration Statement
relating to such Registrable Securities, to exercise usual standards of
due diligence in respect thereto and, if any portion of the offering
contemplated by such Shelf Registration Statement is an underwritten
offering or is made through a placement or sales agent, to recommend the
yield of such Registrable Securities, (B) indemnifying any such
qualified independent underwriter to the extent of the indemnification
of underwriters provided in Section 6 hereof (or to such other customary
extent as may be requested by such underwriter), and (C) providing such
information to such broker-dealer as may be required in order for such
broker-dealer to comply with the requirements of the Conduct Rules; and
(xx) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as soon
as practicable but in any event not later than eighteen months after the
effective date of such Shelf Registration Statement, an earning
statement of the Company and its subsidiaries complying with Section
11(a) of the Securities Act (including, at the option of the Company,
Rule 158 thereunder).
(e) In the event that the Issuers would be required, pursuant to Section
3(d)(viii)(F) above, to notify the Electing Holders, the placement or sales
agent, if any, therefor and the managing underwriters, if any, thereof, the
Issuers shall prepare and furnish to each of the Electing Holders, to each
placement or sales agent, if any, and to each such underwriter, if any, a
reasonable number of copies of a prospectus supplemented or amended so that, as
thereafter delivered to purchasers of Registrable Securities, such prospectus
conforms in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act, and the rules and regulations of the
Commission thereunder, and shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances then
existing. Each Electing Holder agrees that upon receipt of any notice from the
Issuers pursuant to Section 3(d)(viii)(F) hereof, such Electing Holder shall
forthwith discontinue the disposition of Registrable Securities pursuant to the
Shelf Registration Statement applicable to such Registrable Securities until
such Electing Holder shall have received copies of such amended or supplemented
prospectus, and if so directed by the Issuers, such Electing Holder shall
deliver to the Issuers (at the Issuers' expense) all copies, other than
permanent file copies, then in such Electing Holder's possession of the
prospectus covering such Registrable Securities at the time of receipt of such
notice.
(f) In the event of a Shelf Registration, in addition to the information
required to be provided by each Electing Holder in its Notice and Questionnaire,
the Issuers may require such Electing Holder to furnish to the Issuers such
additional information regarding such Electing Holder and such Electing Holder's
intended method of distribution of Registrable Securities as may be required in
order to comply with the
17
Securities Act. Each such Electing Holder agrees to notify the Issuers as
promptly as practicable of any inaccuracy or change in information previously
furnished by such Electing Holder to the Issuers or of the occurrence of any
event in either case as a result of which any prospectus relating to such Shelf
Registration contains or would contain an untrue statement of a material fact
regarding such Electing Holder or such Electing Holder's intended method of
disposition of such Registrable Securities or omits to state any material fact
regarding such Electing Holder or such Electing Holder's intended method of
disposition of such Registrable Securities required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing, and promptly to furnish to the Issuers any
additional information required to correct and update any previously furnished
information or required so that such prospectus shall not contain, with respect
to such Electing Holder or the disposition of such Registrable Securities, an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing.
4. Registration Expenses.
The Issuers agree, subject to the last sentence of this Section, to bear
and to pay or cause to be paid promptly all expenses incident to the Issuers'
performance of or compliance with this Exchange and Registration Rights
Agreement, including (a) all Commission and any NASD registration, filing and
review fees and expenses including fees and disbursements of counsel for the
placement or sales agent or underwriters in connection with such registration,
filing and review, (b) all fees and expenses in connection with the
qualification of the Notes for offering and sale under the securities laws and
blue sky laws referred to in Section 3(d)(xii) hereof and determination of their
eligibility for investment under the laws of such jurisdictions as any managing
underwriters or the Electing Holders may designate, including any fees and
disbursements of counsel for the Electing Holders or underwriters in connection
with such qualification and determination, (c) all expenses relating to the
preparation, printing, production, distribution and reproduction of each
registration statement required to be filed hereunder, each prospectus included
therein or prepared for distribution pursuant hereto, each amendment or
supplement to the foregoing, the expenses of preparing the Notes for delivery
and the expenses of printing or producing any underwriting agreements,
agreements among underwriters, selling agreements and blue sky or legal
investment memoranda and all other documents in connection with the offering,
sale or delivery of Notes to be disposed of (including certificates representing
the Notes), (d) messenger, telephone and delivery expenses relating to the
offering, sale or delivery of Notes and the preparation of documents referred in
clause (c) above, (e) fees and expenses of the Trustee under the Indenture, any
agent of the Trustee and any reasonable fees and expenses for counsel for the
Trustee and of any collateral agent or custodian, (f) internal expenses
(including all salaries and expenses of the Issuers' officers and employees
performing legal or accounting duties), (g) fees, disbursements and expenses
18
of counsel and independent certified public accountants of the Issuers
(including the expenses of any opinions or "cold comfort" letters required by or
incident to such performance and compliance), (h) fees, disbursements and
expenses of any "qualified independent underwriter" engaged pursuant to Section
3(d)(xix) hereof, (i) reasonable fees, disbursements and expenses of one counsel
for the Electing Holders retained in connection with a Shelf Registration, as
selected by the Electing Holders of at least a majority in aggregate principal
amount of the Registrable Securities held by Electing Holders (which counsel
shall be reasonably satisfactory to the Issuers), (j) any fees charged by
securities rating services for rating the Notes, and (k) reasonable fees,
expenses and disbursements of any other persons, including special experts,
retained by the Issuers in connection with such registration (collectively, the
"Registration Expenses"). To the extent that any Registration Expenses are
incurred, assumed or paid by any holder of Registrable Securities or any
placement or sales agent therefor or underwriter thereof, the Issuers shall
reimburse such person for the full amount of the Registration Expenses so
incurred, assumed or paid promptly after receipt of a request therefor.
Notwithstanding the foregoing, the holders of the Registrable Securities being
registered shall pay all agency fees and commissions and underwriting discounts
and commissions attributable to the sale of such Registrable Securities and the
fees and disbursements of any counsel or other advisors or experts retained by
such holders (severally or jointly), other than the counsel and experts
specifically referred to above.
5. Representations, Warranties and Covenants.
Except with respect to clauses (a) and (b) below, the Issuers represent
and warrant to, and agree with, each Purchaser and each of the holders from time
to time of Registrable Securities the information set forth in this Section 5.
With respect to clauses (a) and (b) below, the Issuers covenant that:
(a) Each registration statement covering Registrable Securities and each
prospectus (including any preliminary or summary prospectus) contained therein
or furnished pursuant to Section 3(d) or Section 3(c) hereof and any further
amendments or supplements to any such registration statement or prospectus, when
it becomes effective or is filed with the Commission, as the case may be, and,
in the case of an underwritten offering of Registrable Securities, at the time
of the closing under the underwriting agreement relating thereto, will conform
in all material respects to the requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; and at all times subsequent to the Effective Time when a
prospectus would be required to be delivered under the Securities Act, other
than from (i) such time as a notice has been given to holders of Registrable
Securities pursuant to Section 3(d)(viii)(F) or Section 3(c)(iii)(F) hereof
until (ii) such time as the Issuers
19
furnishes an amended or supplemented prospectus pursuant to Section 3(e) or
Section 3(c)(iv) hereof, each such registration statement, and each prospectus
(including any summary prospectus) contained therein or furnished pursuant to
Section 3(d) or Section 3(c) hereof, as then amended or supplemented, will
conform in all material respects to the requirements of the Securities Act and
the Trust Indenture Act and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing; provided, however, that this covenant shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Issuers by a holder of Registrable Securities
expressly for use therein.
(b) Any documents incorporated by reference in any prospectus referred
to in Section 5(a) hereof, when they become or became effective or are or were
filed with the Commission, as the case may be, will conform or conformed in all
material respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and none of such documents will contain or contained an untrue
statement of a material fact or will omit or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this covenant shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Issuers by a holder of Registrable Securities
expressly for use therein.
(c) The compliance by the Issuers with all of the provisions of this
Exchange and Registration Rights Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a material
breach of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement, lease, license, franchise
agreement, permit or other material agreement or instrument to which either of
the Issuers or any of their subsidiaries is a party or by which either of the
Issuers or any of their subsidiaries is bound or to which any of the property or
assets of the Issuers or any of their subsidiaries is subject, nor will such
action result in any violation of the provisions of the certificate of formation
or limited liability company agreement of the Company or the certificate of
incorporation or bylaws of Charter Capital or any statute or any order, rule or
regulation of any court or governmental agency or body, including without
limitation, the Communications Act of 1934, as amended, the Cable Communications
Policy Act of 1984, as amended, the Cable Television Consumer Protection and
Competition Act of 1992, as amended, and the Telecommunications Act of 1996
(collectively, the "Cable Acts") or any order, rule or regulation of the Federal
Communications Commission (the "FCC"), having jurisdiction over the Issuers or
any of their subsidiaries or any of their properties, except for any such
violation which would not materially impair the Issuers' ability to comply
herewith; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required, including, without limitation,
20
under the Cable Acts or any order, rule or regulation of the FCC, for the
consummation by the Issuers of the transactions contemplated by this Exchange
and Registration Rights Agreement, except the registration under the Securities
Act of the Notes, qualification of the Indenture under the Trust Indenture Act
and such consents, approvals, authorizations, registrations or qualifications as
may be required under State Notes or blue sky laws in connection with the
offering and distribution of the Notes.
(d) This Exchange and Registration Rights Agreement has been duly
authorized, executed and delivered by the Issuers.
6. Indemnification.
(a) Indemnification by the Issuers. The Issuers , jointly and severally,
(i) will indemnify and hold harmless each of the holders of Registrable
Securities included in an Exchange Offer Registration Statement, each of the
Electing Holders of Registrable Securities included in a Shelf Registration
Statement and each person who participates as a placement or sales agent or as
an underwriter in any offering or sale of such Registrable Securities against
any losses, claims, damages or liabilities, joint or several, to which such
holder, agent or underwriter may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Exchange Offer Registration
Statement or Shelf Registration Statement, as the case may be, under which such
Registrable Securities were registered under the Securities Act, or any
preliminary, final or summary prospectus contained therein or furnished by the
Issuers to any such holder, Electing Holder, agent or underwriter, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and (ii)
will reimburse such holder, such Electing Holder, such agent and such
underwriter for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that neither of the Issuers shall be
liable to any such persons in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, or preliminary, final or summary prospectus, or
amendment or supplement thereto, in reliance upon and in conformity with written
information furnished to the Issuers by such persons expressly for use therein.
(b) Indemnification by the Holders and any Agents and Underwriters. The
Issuers may require, as a condition to including any Registrable Securities in
any registration statement filed pursuant to Section 2(b) hereof and to entering
into any underwriting agreement or similar agreement with respect thereto, that
the Issuers shall have received an undertaking reasonably satisfactory to them
from the Electing Holder of
21
such Registrable Securities included in a Shelf Registration Statement and from
each underwriter or agent named in any such underwriting agreement or similar
agreement, severally and not jointly, to (i) indemnify and hold harmless the
Issuers and all other holders of Registrable Securities, against any losses,
claims, damages or liabilities to which the Issuers or such other holders of
Registrable Securities may become subject, under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in such registration statement, or
any preliminary, final or summary prospectus contained therein or furnished by
the Issuers to any such Electing Holder, agent or underwriter, or any amendment
or supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Issuers by such Electing
Holder or underwriter expressly for use therein, and (ii) reimburse the Issuers
for any legal or other expenses reasonably incurred by the Issuers in connection
with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that no such Electing Holder shall be required to
undertake liability to any person under this Section 6(b) for any amounts in
excess of the dollar amount of the proceeds to be received by such Electing
Holder from the sale of such Electing Holder's Registrable Securities pursuant
to such registration.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party under subsection (a) or (b) above of written notice of the commencement of
any action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party pursuant to the indemnification provisions of
or contemplated by this Section 6, notify such indemnifying party in writing of
the commencement of such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party otherwise than under the indemnification provisions of or
contemplated by Section 6(a) or 6(b) hereof. In case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
of the commencement thereof, such indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, such indemnifying party shall
not be liable to such indemnified party for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any
22
judgment with respect to, any pending or threatened action or claim in respect
of which indemnification or contribution may be sought hereunder (whether or not
the indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
(d) Contribution. If for any reason the indemnification provisions
contemplated by Section 6(a) or Section 6(b) are unavailable to or insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages
or liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and the indemnified party in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault of such indemnifying party and
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by
such indemnifying party or by such indemnified party, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The parties hereto agree that it would not be just
and equitable if contributions pursuant to this Section 6(d) were determined by
pro rata allocation (even if the holders or any agents or underwriters or all of
them were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to in this Section 6(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, or liabilities (or actions in respect
thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6(d), no holder shall be required to contribute any
amount in excess of the amount by which the dollar amount of the proceeds
received by such holder from the sale of any Registrable Securities (after
deducting any fees, discounts and commissions applicable thereto) exceeds the
amount of any damages which such holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission, and no underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Registrable
Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from
23
any person who was not guilty of such fraudulent misrepresentation. The holders'
and any underwriters' obligations in this Section 6(d) to contribute shall be
several in proportion to the principal amount of Registrable Securities
registered or underwritten, as the case may be, by them and not joint.
(e) The obligations of the Issuers under this Section 6 shall be in
addition to any liability which the Issuers may otherwise have and shall extend,
upon the same terms and conditions, to each officer, director and partner of
each holder, agent and underwriter and each person, if any, who controls any
holder, agent or underwriter within the meaning of the Securities Act; and the
obligations of the holders and any agents or underwriters contemplated by this
Section 6 shall be in addition to any liability which the respective holder,
agent or underwriter may otherwise have and shall extend, upon the same terms
and conditions, to each officer (including any officer who signed any
registration statement), director, employee, representative or agent of the
Issuers and to each person, if any, who controls the Issuers within the meaning
of the Securities Act.
7. Underwritten Offerings.
(a) Selection of Underwriters. If any of the Registrable Securities
covered by the Shelf Registration are to be sold pursuant to an underwritten
offering, the managing underwriter or underwriters thereof shall be designated
by Electing Holders holding at least a majority in aggregate principal amount of
the Registrable Securities to be included in such offering, provided that such
designated managing underwriter or underwriters is or are reasonably acceptable
to the Issuers.
(b) Participation by Holders. Each holder of Registrable Securities
hereby agrees with each other such holder that no such holder may participate in
any underwritten offering hereunder unless such holder (i) agrees to sell such
holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
8. Rule 144.
Each of the Issuers covenants to the holders of Registrable Securities
that to the extent it shall be required to do so under the Exchange Act, it
shall timely file the reports required to be filed by it under the Exchange Act
or the Securities Act (including the reports under Section 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the
Commission under the Securities Act) and the rules and regulations adopted by
the Commission thereunder, and shall take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required
24
from time to time to enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitations of the exemption
provided by Rule 144 under the Securities Act, as such Rule may be amended from
time to time, or any similar or successor rule or regulation hereafter adopted
by the Commission. Upon the request of any holder of Registrable Securities in
connection with that holder's sale pursuant to Rule 144, the Issuers shall
deliver to such holder a written statement as to whether it has complied with
such requirements.
9. Miscellaneous.
(a) No Inconsistent Agreements. The Issuers represent, warrant, covenant
and agree that they have not granted, and shall not grant, registration rights
with respect to Registrable Securities or any other Notes which would be
inconsistent with the terms contained in this Exchange and Registration Rights
Agreement.
(b) Specific Performance. The parties hereto acknowledge that there
would be no adequate remedy at law if the Issuers fail to perform any of their
obligations hereunder and that the Purchasers and the holders from time to time
of the Registrable Securities may be irreparably harmed by any such failure, and
accordingly agree that the Purchasers and such holders, in addition to any other
remedy to which they may be entitled at law or in equity, shall be entitled to
compel specific performance of the obligations of the Issuers under this
Exchange and Registration Rights Agreement in accordance with the terms and
conditions of this Exchange and Registration Rights Agreement, in any court of
the United States or any State thereof having jurisdiction.
(c) Notices. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
duly given (i) when delivered by hand, if delivered personally or by courier,
(ii) when sent by facsimile (with written confirmation of receipt), provided
that a copy is mailed by registered or certified mail, return receipt requested
or (iii) three days after being deposited in the mail (registered or certified
mail, postage prepaid, return receipt requested) as follows: If to the Issuers,
c/o Charter Communications Holdings, LLC, 12444 Powerscourt Drive, Suite 100,
St. Louis, Missouri, 63131, Attention: Secretary, and if to a holder, to the
address of such holder set forth in the security register or other records of
the Issuers, or to such other address as the Issuers or any such holder may have
furnished to the other in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
(d) Parties in Interest. All the terms and provisions of this Exchange
and Registration Rights Agreement shall be binding upon, shall inure to the
benefit of and shall be enforceable by the parties hereto and the holders from
time to time of the Registrable Securities and the respective successors and
assigns of the parties hereto and such holders. In the event that any transferee
of any holder of Registrable Securities shall
25
acquire Registrable Securities, in any manner, whether by gift, bequest,
purchase, operation of law or otherwise, such transferee shall, without any
further writing or action of any kind, be deemed a beneficiary hereof for all
purposes and such Registrable Securities shall be held subject to all of the
terms of this Exchange and Registration Rights Agreement, and by taking and
holding such Registrable Securities such transferee shall be entitled to receive
the benefits of, and be conclusively deemed to have agreed to be bound by all of
the applicable terms and provisions of this Exchange and Registration Rights
Agreement. If the Issuers shall so request, any such successor, assign or
transferee shall agree in writing to acquire and hold the Registrable Securities
subject to all of the applicable terms hereof.
(e) Survival. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Exchange and Registration
Rights Agreement or made pursuant hereto shall remain in full force and effect
regardless of any investigation (or statement as to the results thereof) made by
or on behalf of any holder of Registrable Securities, any director, officer or
partner of such holder, any agent or underwriter or any director, officer or
partner thereof, or any controlling person of any of the foregoing, and shall
survive delivery of and payment for the Registrable Securities pursuant to the
Purchase Agreement and the transfer and registration of Registrable Securities
by such holder and the consummation of an Exchange Offer.
(f) Governing Law. This Exchange and Registration Rights Agreement shall
be governed by and construed in accordance with the laws of the State of New
York.
(g) Headings. The descriptive headings of the several Sections and
paragraphs of this Exchange and Registration Rights Agreement are inserted for
convenience only, do not constitute a part of this Exchange and Registration
Rights Agreement and shall not affect in any way the meaning or interpretation
of this Exchange and Registration Rights Agreement.
(h) Entire Agreement; Amendments. This Exchange and Registration Rights
Agreement and the other writings referred to herein (including the Indenture and
the form of Notes) or delivered pursuant hereto which form a part hereof contain
the entire understanding of the parties with respect to its subject matter. This
Exchange and Registration Rights Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter. This
Exchange and Registration Rights Agreement may be amended and the observance of
any term of this Exchange and Registration Rights Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument duly executed by the Issuers and the
holders of at least a majority in aggregate principal amount of the Registrable
Securities at the time outstanding. Each holder of any Registrable Securities at
the time or thereafter outstanding shall be bound by any amendment or waiver
effected
26
pursuant to this Section 9(h), whether or not any notice, writing or marking
indicating such amendment or waiver appears on such Registrable Securities or is
delivered to such holder.
(i) Inspection. For so long as this Exchange and Registration Rights
Agreement shall be in effect, this Exchange and Registration Rights Agreement
and a complete list of the names and addresses of all the holders of Registrable
Securities shall be made available for inspection and copying, upon reasonable
prior notice, on any business day during normal business hours by any holder of
Registrable Securities for proper purposes only (which shall include any purpose
related to the rights of the holders of Registrable Securities under the Notes,
the Indenture and this Agreement) at the offices of the Issuers at the address
thereof set forth in Section 9(c) above and at the office of the Trustee under
the Indenture.
(j) Counterparts. This agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
27
If the foregoing is in accordance with your understanding, please sign
and return to us counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Issuers.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Issuers for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
Very truly yours,
CHARTER COMMUNICATIONS HOLDINGS, LLC,
as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
CHARTER COMMUNICATIONS HOLDINGS
CAPITAL CORPORATION, as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
28
Accepted as of the date hereof:
GOLDMAN, SACHS & CO.
MORGAN STANLEY & CO. INCORPORATED
BANC OF AMERICA SECURITIES LLC
BEAR, STEARNS & CO. INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SALOMON SMITH BARNEY INC.
JP MORGAN, A DIVISION OF CHASE SECURITIES INC.
CREDIT LYONNAIS SECURITIES (USA) INC.
FLEET SECURITIES, INC.
BMO NESBITT BURNS CORP.
DRESDNER KLEINWORT WASSERSTEIN SECURITIES LLC
By: GOLDMAN, SACHS & CO.
By: /s/ GOLDMAN, SACHS & CO.
------------------------
Name:
Title:
By: MORGAN STANLEY & CO. INCORPORATED
By: /s/ IRENE MAVROYANNIS
--------------------------------
Name: Irene Mavroyannis
Title: Vice President
29
EXHIBIT A
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
INSTRUCTION TO DTC PARTICIPANTS
-------------------------------
(Date of Mailing)
URGENT - IMMEDIATE ATTENTION REQUESTED
DEADLINE FOR RESPONSE: [DATE](a)
The Depository Trust Issuers ("DTC") has identified you as a DTC
Participant through which beneficial interests in the Charter Communications
Holdings, LLC (the "Company") and Charter Communications Holdings Capital
Corporation ("Charter Capital" and, together with the Company, the "Issuers")
9.625% Senior Notes due 2009 (the "Notes") are held.
The Issuers are in the process of registering the Notes under the
Securities Act of 1933, as amended, for resale by the beneficial owners thereof.
In order to have their Notes included in the registration statement, beneficial
owners must complete and return the enclosed Notice of Registration Statement
and Selling Securityholder Questionnaire.
It is important that beneficial owners of the Notes receive a copy of
the enclosed materials as soon as possible as their rights to have the Notes
included in the registration statement depend upon their returning the Notice
and Questionnaire by [Deadline For Response]. Please forward a copy of the
enclosed documents to each beneficial owner that holds interests in the Notes
through you. If you require more copies of the enclosed materials or have any
questions pertaining to this matter, please contact the Issuers c/o Charter
Communications Holdings, LLC, 12444 Powerscourt Drive, Suite 100, St. Louis,
Missouri, 63131, Attention: Secretary.
(a) Not less than 28 calendar days from date of mailing.
A-1
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
Notice of Registration Statement
and
Selling Securityholder Questionnaire
------------------------------------
(Date)
Reference is hereby made to the Exchange and Registration Rights
Agreement (the "Exchange and Registration Rights Agreement") between Charter
Communications Holdings, LLC and Charter Communications Holdings Capital
Corporation (together, the "Issuers"), and the Purchasers named therein.
Pursuant to the Exchange and Registration Rights Agreement, the Issuers have
filed with the United States Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (the "Shelf Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities Act"), of the Issuers' 9.625% Senior Notes
due 2009 (the "Notes"). A copy of the Exchange and Registration Rights Agreement
is attached hereto. All capitalized terms not otherwise defined herein shall
have the meanings ascribed thereto in the Exchange and Registration Rights
Agreement.
Each beneficial owner of Registrable Securities is entitled to have the
Registrable Securities beneficially owned by it included in the Shelf
Registration Statement. In order to have Registrable Securities included in the
Shelf Registration Statement, this Notice of Registration Statement and Selling
Securityholder Questionnaire ("Notice and Questionnaire") must be completed,
executed and delivered to the Issuers' counsel at the address set forth herein
for receipt ON OR BEFORE [Deadline for Response]. Beneficial owners of
Registrable Securities who do not complete, execute and return this Notice and
Questionnaire by such date (i) will not be named as selling securityholders in
the Shelf Registration Statement and (ii) may not use the Prospectus forming a
part thereof for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Shelf Registration
Statement and related prospectus.
A-2
ELECTION
The undersigned holder (the "Selling Securityholder") of Registrable
Securities hereby elects to include in the Shelf Registration Statement the
Registrable Securities beneficially owned by it and listed below in Item (3).
The undersigned, by signing and returning this Notice and Questionnaire, agrees
to be bound with respect to such Registrable Securities by the terms and
conditions of this Notice and Questionnaire and the Exchange and Registration
Rights Agreement, including, without limitation, Section 6 of the Exchange and
Registration Rights Agreement, as if the undersigned Selling Securityholder were
an original party thereto.
Upon any sale of Registrable Securities pursuant to the Shelf
Registration Statement, the Selling Securityholder will be required to deliver
to the Issuers and the Trustee the Notice of Transfer set forth in Exhibit B to
the Exchange and Registration Rights Agreement.
The Selling Securityholder hereby provides the following information to
the Issuers and represents and warrants that such information is accurate and
complete:
QUESTIONNAIRE
(1) (a) Full Legal Name of Selling Securityholder:
(b) Full Legal Name of Registered Holder (if not the same as in (a)
above) of Registrable Securities Listed in Item (3) below:
(c) Full Legal Name of DTC Participant (if applicable and if not the
same as (b) above) Through Which Registrable Securities Listed in Item (3) below
are Held:
(2) Address for Notices to Selling Securityholder:
-------------------------------------
-------------------------------------
-------------------------------------
Telephone:
-------------------------------------
Fax:
-------------------------------------
Contact Person:
-------------------------------------
A-3
(3) Beneficial Ownership of Notes:
Except as set forth below in this Item (3), the undersigned does not
beneficially own any Notes.
(a) Principal amount of Registrable Securities beneficially owned:
_________________________________________________________________
CUSIP No(s). of such Registrable Securities:_____________________
(b) Principal amount of Notes other than Registrable Securities
beneficially owned: _____________________________________________
CUSIP No(s). of such other Notes: _______________________________
(c) Principal amount of Registrable Securities which the undersigned
wishes to be included in the Shelf Registration Statement:
__________________
CUSIP No(s). of such Registrable Securities to be included in the
Shelf Registration Statement:____________________________________
(4) Beneficial Ownership of Other Securities of the Issuers:
Except as set forth below in this Item (4), the undersigned Selling
Securityholder is not the beneficial or registered owner of any other
securities of the Issuers other than the Notes listed above in Item (3).
State any exceptions here:
(5) Relationships with the Issuers:
Except as set forth below, neither the Selling Securityholder nor any of
its affiliates, officers, directors or principal equity holders (5% or
more) has held any position or office or has had any other material
relationship with the Issuers (or their respective predecessors or
affiliates) during the past three years.
State any exceptions here:
(6) Plan of Distribution:
Except as set forth below, the undersigned Selling Securityholder
intends to distribute the Registrable Securities listed above in Item
(3) only as follows (if at all): Such Registrable Securities may be sold
from time to time directly by the undersigned Selling Securityholder or,
alternatively, through underwriters,
A-4
broker-dealers or agents. Such Registrable Securities may be sold in one
or more transactions at fixed prices, at prevailing market prices at the
time of sale, at varying prices determined at the time of sale, or at
negotiated prices. Such sales may be effected in transactions (which may
involve crosses or block transactions) (i) on any national securities
exchange or quotation service on which the Registered Notes may be
listed or quoted at the time of sale, (ii) in the over-the-counter
market, (iii) in transactions otherwise than on such exchanges or
services or in the over-the-counter market, or (iv) through the writing
of options. In connection with sales of the Registrable Securities or
otherwise, the Selling Securityholder may enter into hedging
transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities in the course of hedging the
positions they assume. The Selling Securityholder may also sell
Registrable Securities short and deliver Registrable Securities to close
out such short positions, or loan or pledge Registrable Securities to
broker-dealers that in turn may sell such Notes.
State any exceptions here:
By signing below, the Selling Securityholder acknowledges that it understands
its obligation to comply, and agrees that it will comply, with the provisions of
the Exchange Act and the rules and regulations thereunder, particularly
Regulation M.
In the event that the Selling Securityholder transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Issuers, the Selling Securityholder agrees to
notify the transferee(s) at the time of the transfer of its rights and
obligations under this Notice and Questionnaire and the Exchange and
Registration Rights Agreement.
By signing below, the Selling Securityholder consents to the disclosure of the
information contained herein in its answers to Items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and
related Prospectus. The Selling Securityholder understands that such information
will be relied upon by the Issuers in connection with the preparation of the
Shelf Registration Statement and related Prospectus.
In accordance with the Selling Securityholder's obligation under Section 3(d) of
the Exchange and Registration Rights Agreement to provide such information as
may be required by law for inclusion in the Shelf Registration Statement, the
Selling Securityholder agrees to promptly notify the Issuers of any inaccuracies
or changes in the information provided herein which may occur subsequent to the
date hereof at any time while the Shelf Registration Statement remains in
effect. All notices hereunder and pursuant to the Exchange and Registration
Rights Agreement shall be made in writing, by hand-delivery, first-class mail,
or air courier guaranteeing overnight delivery as follows:
A-5
(i) To the Issuers:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
(ii) With a copy to:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
Once this Notice and Questionnaire is executed by the Selling Securityholder and
received by the Issuers' counsel, the terms of this Notice and Questionnaire,
and the representations and warranties contained herein, shall be binding on,
shall inure to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives, and assigns of the Issuers and the
Selling Securityholder (with respect to the Registrable Securities beneficially
owned by such Selling Securityholder and listed in Item (3) above). This
Agreement shall be governed in all respects by the laws of the State of New York
without giving effect to any provisions relating to conflicts of laws.
IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.
Dated:
--------------------------
- --------------------------------------------------------------
Selling Securityholder
(Print/type full legal name of beneficial owner of Registrable Securities)
By
------------------------------------------------------------------------
Name:
Title:
A-6
PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON
OR BEFORE [DEADLINE FOR RESPONSE] TO THE ISSUERS' COUNSEL AT:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
A-7
EXHIBIT B
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
BNY Midwest Trust Company
Charter Communications Holdings, LLC
Charter Communications Holdings Capital
Corporation
c/o BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Trust Officer
Re: Charter Communications Holdings, LLC
and Charter Communications Holdings Capital Corporation
(together, the "Issuers") 9.625% Senior Notes due 2009
Dear Sirs:
Please be advised that ______________ has transferred $__________ aggregate
principal amount of the above-referenced Notes pursuant to an effective
Registration Statement on Form S-3 (File No. 333-____) filed by the Issuers.
We hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933, as amended, have been satisfied and that the above-named
beneficial owner of the Notes is named as a "Selling Holder" in the prospectus
dated [date] or in supplements thereto, and that the aggregate principal amount
of the Notes transferred are the Notes listed in such prospectus opposite such
owner's name.
Dated:
Very truly yours,
------------------------------
(Name)
By:
------------------------------
(Authorized Signature)
B-1
INDENTURE dated as of May 15, 2001 among Charter Communications
Holdings, LLC, a Delaware limited liability company (as further defined below,
the "Company"), Charter Communications Holdings Capital Corporation, a Delaware
corporation (as further defined below, "Charter Capital" and together with the
Company, the "Issuers"), and BNY Midwest Trust Company, as trustee (the
"Trustee").
The Issuers and the Trustee agree as follows for the benefit of
each other and for the equal and ratable benefit of the Holders of the Notes:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
------------------------------------------
Section 1.01. Definitions.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such
specified Person, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging
with or into, or becoming a Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired
by such specified Person.
"Additional Notes" means the Issuers' 10.000% Senior Notes due 2011
issued under this Indenture in addition to the Original Notes (other than any
Notes issued in respect of Original Notes pursuant to Section 2.06, 2.07, 2.10,
3.06, 3.09, 4.16 or 9.05).
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling, "controlled by" and "under common control
with" shall have correlative meanings.
"Agent" means any Registrar or Paying Agent.
1
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of the Depositary, Euroclear and Clearstream, in each case to the
extent applicable to such transaction and as in effect from time to time.
"Asset Acquisition" means (a) an Investment by the Company or any of
the Company's Restricted Subsidiaries in any other Person pursuant to which such
Person shall become a Restricted Subsidiary of the Company or any of its
Restricted Subsidiaries or shall be merged with or into the Company or any of
the Company's Restricted Subsidiaries, or (b) the acquisition by the Company or
any of the Company's Restricted Subsidiaries of the assets of any Person which
constitute all or substantially all of the assets of such Person, any division
or line of business of such Person or any other properties or assets of such
Person other than in the ordinary course of business.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any
assets or rights, other than sales of inventory in the ordinary course
of business consistent with past practices; provided that the sale,
conveyance or other disposition of all or substantially all of the
assets of the Company and its Restricted Subsidiaries, taken as a
whole, shall be governed by Section 4.16 and/or Section 5.01 and not
by the provisions of Section 4.11; and
(2) the issuance of Equity Interests by any of the Company's
Restricted Subsidiaries or the sale of Equity Interests in any of the
Company's Restricted Subsidiaries.
Notwithstanding the preceding, the following items shall not be
deemed to be Asset Sales:
(1) any single transaction or series of related transactions
that: (a) involves assets having a fair market value of less than $100
million; or (b) results in net proceeds to the Company and its
Restricted Subsidiaries of less than $100 million;
(2) a transfer of assets between or among the Company and its
Restricted Subsidiaries;
(3) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary of the Company to the Company or to another Wholly Owned
Restricted Subsidiary of the Company;
(4) a Restricted Payment that is permitted by Section 4.07 and a
Restricted Investment that is permitted by Section 4.08; and
2
(5) the incurrence of Permitted Liens and the disposition of
assets related to such Permitted Liens by the secured party pursuant
to a foreclosure.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value of the obligation of the
lessee for net rental payments during the remaining term of the lease included
in such sale and leaseback transaction including any period for which such lease
has been extended or may, at the option of the lessee, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or
state law of any jurisdiction relating to bankruptcy, insolvency, winding up,
liquidation, reorganization or relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule
13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as such term is used in Section
13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire, whether
such right is currently exercisable or is exercisable only upon the occurrence
of a subsequent condition.
"Board of Directors" means the Manager or the Board of Directors of
the Company or the Board of Directors of Charter Capital, as the case may be, or
any authorized committee of the Board of Directors of the Company or Charter
Capital, as the case may be.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company or Charter Capital, as the
case may be, to have been duly adopted by the Board of Directors of the Company
or Charter Capital, as the case may be, and to be in full force and effect on
the date of such certification and delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Cable Related Business" means the business of owning cable
television systems and businesses ancillary, complementary and related thereto.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at that time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means:
3
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest (other than any debt obligation) or
participation that confers on a Person the right to receive a share of
the profits and losses of, or distributions of assets of, the issuing
Person.
"Capital Stock Sale Proceeds" means the aggregate net cash proceeds
(including the fair market value of the non-cash proceeds, as determined by an
independent appraisal firm) received by the Company since March 17, 1999 (x) as
a contribution to the common equity capital or from the issue or sale of Equity
Interests of the Company (other than Disqualified Stock) or (y) from the issue
or sale of convertible or exchangeable Disqualified Stock or convertible or
exchangeable debt securities of the Company that have been converted into or
exchanged for such Equity Interests (other than Equity Interests (or
Disqualified Stock or debt securities) sold to a Subsidiary of the Company).
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured
by the United States government or any agency or instrumentality
thereof (provided that the full faith and credit of the United States
is pledged in support thereof) having maturities of not more than
twelve months from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of twelve months or less from the date of acquisition,
bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case, with any domestic commercial
bank having combined capital and surplus in excess of $500 million and
a Thompson Bank Watch Rating at the time of acquisition of "B" or
better;
(4) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (2)
and (3) above entered into with any financial institution meeting the
qualifications specified in clause (3) above;
4
(5) commercial paper having a rating of at least "P-1" from
Moody's or at least "A-1" from S&P and in each case maturing within
twelve months after the date of acquisition;
(6) corporate debt obligations maturing within twelve months
after the date of acquisition thereof, rated at the time of
acquisition at least "Aaa" or "P-1" by Moody's or "AAA" or "A-1" by
S&P;
(7) auction-rate preferred stocks of any corporation maturing not
later than 45 days after the date of acquisition thereof, rated at the
time of acquisition at least "Aaa" by Moody's or "AAA" by S&P;
(8) securities issued by any state, commonwealth or territory of
the United States, or by any political subdivision or taxing authority
thereof, maturing not later than six months after the date of
acquisition thereof, rated at the time of acquisition at least "A" by
Moody's or S&P; and
(9) money market or mutual funds at least 90% of the assets of
which constitute Cash Equivalents of the kinds described in clauses
(1) through (8) of this definition.
"Change of Control" means the occurrence of any of the following:
(1) the sale, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company
and its Subsidiaries, taken as a whole, or of a Parent and its
Subsidiaries, taken as a whole, to any "person" (as such term is used
in Section 13(d)(3) of the Exchange Act) other than the Principal or a
Related Party of the Principal;
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company or a Parent;
(3) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that
any "person" (as defined above), other than the Principal and Related
Parties, becomes the Beneficial Owner, directly or indirectly, of more
than 35% of the Voting Stock of the Company or a Parent, measured by
voting power rather than the number of shares, unless the Principal or
a Related Party Beneficially Owns, directly or indirectly, a greater
percentage of Voting Stock of the Company or such Parent, as the case
may be, measured by voting power rather than the number of shares,
than such person;
5
(4) after the Issue Date, the first day on which a majority of
the members of the Board of Directors of the Company or the board of
directors of a Parent are not Continuing Directors; or
(5) the Company or a Parent consolidates with, or merges with or
into, any Person, or any Person consolidates with, or merges with or
into, the Company or a Parent, in any such event pursuant to a
transaction in which any of the outstanding Voting Stock of the
Company or such Parent is converted into or exchanged for cash,
securities or other property, other than any such transaction where
the Voting Stock of the Company or such Parent outstanding immediately
prior to such transaction is converted into or exchanged for Voting
Stock (other than Disqualified Stock) of the surviving or transferee
Person constituting a majority of the outstanding shares of such
Voting Stock of such surviving or transferee Person immediately after
giving effect to such issuance.
"Charter Capital" means Charter Communications Holdings Capital
Corporation, a Delaware corporation, and any successor in interest thereto.
"Clearstream" means Clearstream Banking, societe anonyme (formerly
Cedelbank).
"Commission" or "SEC" means the Securities and Exchange Commission.
"Company" means Charter Communications Holdings, LLC, a Delaware
limited liability company, and any successor in interest thereto.
"Consolidated EBITDA" means with respect to any Person, for any
period, the net income of such Person and its Restricted Subsidiaries for such
period plus, to the extent such amount was deducted in calculating such net
income:
(1) Consolidated Interest Expense;
(2) income taxes;
(3) depreciation expense;
(4) amortization expense;
(5) all other non-cash items, extraordinary items, nonrecurring
and unusual items and the cumulative effects of changes in accounting
principles reducing such net income, less all non-cash items,
extraordinary items, nonrecurring and unusual items and cumulative
effects of changes in accounting principles increasing such net
income, all as determined on a consolidated basis for such Person and
its Restricted Subsidiaries in conformity with GAAP;
6
(6) amounts actually paid during such period pursuant to a
deferred compensation plan; and
(7) for purposes of Section 4.10 only, Management Fees;
provided that Consolidated EBITDA shall not include:
(x) the net income (or net loss) of any Person that is not a
Restricted Subsidiary ("Other Person"), except (i) with respect to net
income, to the extent of the amount of dividends or other
distributions actually paid to such Person or any of its Restricted
Subsidiaries by such Other Person during such period and (ii) with
respect to net losses, to the extent of the amount of investments made
by such Person or any Restricted Subsidiary of such Person in such
Other Person during such period;
(y) solely for the purposes of calculating the amount of
Restricted Payments that may be made pursuant to clause (3) of Section
4.07 (and in such case, except to the extent includable pursuant to
clause (x) above) the net income (or net loss) of any Other Person
accrued prior to the date it becomes a Restricted Subsidiary or is
merged into or consolidated with such Person or any Restricted
Subsidiaries or all or substantially all of the property and assets of
such Other Person are acquired by such Person or any of its Restricted
Subsidiaries; and
(z) the net income of any Restricted Subsidiary of the Company to
the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary of such net income is not
at the time permitted by the operation of the terms of such Restricted
Subsidiary's charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to such
Restricted Subsidiary (other than any agreement or instrument
evidencing Indebtedness or Preferred Stock (i) outstanding on the
Issue Date, or (ii) incurred or issued thereafter in compliance with
Section 4.10, provided that (a) the terms of any such agreement or
instrument restricting the declaration and payment of dividends or
similar distributions apply only in the event of a default with
respect to a financial covenant or a covenant relating to payment
(beyond any applicable period of grace) contained in such agreement or
instrument, (b) such terms are determined by such Person to be
customary in comparable financings and (c) such restrictions are
determined by the Company not to materially affect the Issuers'
ability to make principal or interest payments on the Notes when due).
"Consolidated Indebtedness" means, with respect to any Person as of
any date of determination, the sum, without duplication, of:
(1) the total amount of outstanding Indebtedness of such Person
and its Restricted Subsidiaries, plus
7
(2) the total amount of Indebtedness of any other Person that has
been Guaranteed by the referent Person or one or more of its
Restricted Subsidiaries, plus
(3) the aggregate liquidation value of all Disqualified Stock of
such Person and all Preferred Stock of Restricted Subsidiaries of such
Person, in each case, determined on a consolidated basis in accordance
with GAAP.
"Consolidated Interest Expense" means, with respect to any Person
for any period, without duplication, the sum of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization or original issue
discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, commissions, discounts and
other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net payments (if any) pursuant to
Hedging Obligations); and
(2) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period; and
(3) any interest expense on Indebtedness of another Person that
is guaranteed by such Person or one of its Restricted Subsidiaries or
secured by a Lien on assets of such Person or one of its Restricted
Subsidiaries (whether or not such Guarantee or Lien is called upon);
excluding, however, any amount of such interest of any Restricted Subsidiary of
the referent Person if the net income of such Restricted Subsidiary is excluded
in the calculation of Consolidated EBITDA pursuant to clause (z) of the
definition thereof (but only in the same proportion as the net income of such
Restricted Subsidiary is excluded from the calculation of Consolidated EBITDA
pursuant to clause (z) of the definition thereof), in each case, on a
consolidated basis and in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company or the board of directors of a
Parent who:
(1) was a member of such board of directors on the Issue Date;
or
(2) was nominated for election or elected to such board of
directors with the approval of a majority of the Continuing Directors
who were members of such board of directors at the time of such
nomination or election or whose election or appointment was previously
so approved.
8
"Corporate Trust Office of the Trustee" shall be at the address of
the Trustee specified in Section 10.02 or such other address as to which the
Trustee may give notice to the Issuers.
"Credit Facilities" means, with respect to the Company and/or its
Restricted Subsidiaries, one or more debt facilities or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced or refinanced
in whole or in part from time to time.
"Default" means any event that is, or with the passage of time or
the giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name
of the Holder thereof and issued in accordance with Section 2.06, substantially
in the form of Exhibit A hereto, except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Global Notes, the Person
specified in Section 2.03 as the Depositary with respect to the Notes, and any
and all successors thereto appointed as depositary hereunder and having become
such pursuant to the applicable provision of this Indenture.
"Disposition" means, with respect to any Person, any merger,
consolidation or other business combination involving such Person (whether or
not such Person is the surviving Person) or the sale, assignment, or transfer,
lease conveyance or other disposition of all or substantially all of such
Person's assets or Capital Stock.
"Disqualified Stock" means any Capital Stock that, by its terms (or
by the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the Notes mature. Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase such Capital
Stock upon the occurrence of a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock provide that
the Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.07.
9
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means any private or underwritten public offering
of Qualified Capital Stock of the Company or a Parent of which the gross
proceeds (x) to the Company or (y) received by the Company as a capital
contribution from such Parent, as the case may be, are at least $25 million.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the Issuers' 10.000% Senior Notes due 2011,
containing terms substantially identical to the Initial Notes or any Initial
Additional Notes (except that (i) such Exchange Notes shall not contain terms
with respect to transfer restrictions and shall be registered under the
Securities Act and (ii) certain provisions relating to an increase in the stated
rate of interest thereon shall be eliminated), that are issued and exchanged for
(a) the Initial Notes, as provided for in the Registration Rights Agreement
relating to such Initial Notes and this Indenture or (b) such Initial Additional
Notes, as may be provided in any Registration Rights Agreement relating to such
Initial Additional Notes and this Indenture (including any amendment or
supplement thereto).
"Exchange Offer" means an offer to exchange Initial Notes or Initial
Additional Notes, if any, for Exchange Notes pursuant to a Registration Rights
Agreement.
"Exchange Offer Registration Statement" means a registration
statement relating to an Exchange Offer as may be provided in any Registration
Rights Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries in existence on the Issue Date, until such amounts are
repaid.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect on the Issue Date.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
10
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" or "guarantee" means a guarantee other than by
endorsement of negotiable instruments for collection in the ordinary course of
business, direct or indirect, in any manner including, without limitation, by
way of a pledge of assets or through letters of credit or reimbursement
agreements in respect thereof, of all or any part of any Indebtedness, measured
as the lesser of the aggregate outstanding amount of the Indebtedness so
guaranteed and the face amount of the guarantee.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under:
(1) interest rate swap agreements, interest rate cap agreements
and interest rate collar agreements;
(2) interest rate option agreements, foreign currency exchange
agreements, foreign currency swap agreements; and
(3) other agreements or arrangements designed to protect such
Person against fluctuations in interest and currency exchange rates.
"Helicon Preferred Stock" means the preferred limited liability
company interest of Charter-Helicon LLC with an aggregate liquidation value of
$25 million outstanding on the Issue Date.
"Holder" means a holder of the Notes.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
11
(5) in respect of the balance deferred and unpaid of the purchase
price of any property, except any such balance that constitutes an
accrued expense or trade payable; or
(6) representing the notional amount of any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by such Person of any indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date shall be:
(1) the accreted value thereof, in the case of any Indebtedness
issued with original issue discount; and
(2) the principal amount thereof, together with any interest
thereon that is more than 30 days past due, in the case of any other
Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from
time to time.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Initial Additional Notes" means Additional Notes issued in an
offering not registered under the Securities Act.
"Initial Notes" means the Issuer's 10.000% Senior Notes due 2011,
issued on the Issue Date (and any Notes issued in respect thereof pursuant to
Section 2.06, 2.07, 2.10, 3.06, 3.09, 4.16 or 9.05).
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act that is not also a QIB.
"Investment Grade Rating" means a rating equal to or higher than
Baa3 (or the equivalent) by Moody's and BBB- (or the equivalent) by S&P.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions
12
(excluding commission, travel and similar advances to officers and employees
made in the ordinary course of business) and purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities, together
with all items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP.
"Issue Date" means May 15, 2001.
"Issuers" has the meaning assigned to it in the preamble to this
Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in The City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Issuers and sent to all Holders of the Initial Notes or any
Initial Additional Notes for use by such Holders in connection with any Exchange
Offer.
"Leverage Ratio" means, as of any date, the ratio of:
(1) the Consolidated Indebtedness of the Company on such date to
(2) the aggregate amount of Consolidated EBITDA for the Company
for the most recently ended fiscal quarter for which internal
financial statements are available multiplied by four (the "Reference
Period").
In addition to the foregoing, for purposes of this definition,
"Consolidated EBITDA" shall be calculated on a pro forma basis after giving
effect to
(1) the issuance of the Notes;
(2) the incurrence of the Indebtedness or the issuance of the
Disqualified Stock or other Preferred Stock of a Restricted Subsidiary
(and the application of the proceeds therefrom) giving rise to the
need to make such calculation and any incurrence or issuance (and the
application of the proceeds therefrom) or repayment of other
Indebtedness or Disqualified Stock or other Preferred Stock of a
Restricted Subsidiary, other than the incurrence or repayment of
Indebtedness for ordinary working capital purposes, at any time
subsequent to the beginning of the Reference Period and on or prior to
the date of determination, as if such incurrence (and the application
of the proceeds thereof), or the repayment, as the case may be,
occurred on the first day of the Reference Period; and
13
(3) any Dispositions or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of such Person or one of its Restricted
Subsidiaries (including any person that becomes a Restricted
Subsidiary as a result of such Asset Acquisition) incurring, assuming
or otherwise becoming liable for or issuing Indebtedness, Disqualified
Stock or Preferred Stock) made on or subsequent to the first day of
the Reference Period and on or prior to the date of determination, as
if such Disposition or Asset Acquisition (including the incurrence,
assumption or liability for any such Indebtedness, Disqualified Stock
or Preferred Stock and also including any Consolidated EBITDA
associated with such Asset Acquisition, including any cost savings
adjustments in compliance with Regulation S-X promulgated by the
Commission) had occurred on the first day of the Reference Period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Management Fees" means the fees payable to Charter Communications,
Inc. pursuant to the management agreements between Charter Communications, Inc.
and Charter Communications Operating, LLC and between Charter Communications,
Inc. and Restricted Subsidiaries of the Company and pursuant to the limited
liability company agreements of certain Restricted Subsidiaries, as such
management or limited liability company agreements exist on the Issue Date (or,
if later, on the date any new Restricted Subsidiary is acquired or created),
including any amendment or replacement thereof, provided that any such amendment
or replacement is not more disadvantageous to the Holders of the Notes in any
material respect from such management or limited liability company agreements
existing on the Issue Date.
"Manager" means Charter Communications, Inc., in its capacity as
manager of the Company under the Company's limited liability company agreement,
dated as of February 9, 1999, as amended from time to time, and any successor
manager appointed pursuant to such limited liability company agreement.
"Moody's" means Moody's Investors Service, Inc. or any successor to
the rating agency business thereof.
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash
14
consideration received in any Asset Sale), net of the direct costs relating to
such Asset Sale, including, without limitation, legal, accounting and investment
banking fees, and sales commissions, and any relocation expenses incurred as a
result thereof or taxes paid or payable as a result thereof (including amounts
distributable in respect of owners', partners' or members' tax liabilities
resulting from such sale), in each case after taking into account any available
tax credits or deductions and any tax sharing arrangements and amounts required
to be applied to the repayment of Indebtedness.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable as a guarantor or
otherwise, or (c) constitutes the lender;
(2) no default with respect to which (including any rights that
the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit upon notice, lapse of time or
both any holder of any other Indebtedness (other than the Notes) of
the Company or any of its Restricted Subsidiaries to declare a default
on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and
(3) as to which the lenders have been notified in writing that
they will not have any recourse to the Capital Stock or assets of the
Company or any of its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note" or "Notes" means the Initial Notes, any Additional Notes and
the Exchange Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company or Charter Capital, as the case may be, by two Officers of the Company
or Charter Capital, as the case may be, one of whom must be the principal
executive officer, the chief
15
financial officer or the treasurer of the Company or Charter Capital, as the
case may be, that meets the requirements of Section 10.05.
"Opinion of Counsel" means an opinion from legal counsel that meets
the requirements of Section 10.05. The counsel may be an employee of or counsel
to the Issuers or any Subsidiary of the Issuers.
"Original Notes" means the Initial Notes and any Exchange Notes
issued in exchange therefor.
"Other Notes" means the 9.625% Senior Notes due 2009 of the Issuers
in an aggregate principal amount not to exceed the principal amount issued on
the Issue Date, and the 11.750% Senior Discount Notes due 2011 of the Issuers in
an aggregate principal amount not to exceed the principal amount issued on the
Issue Date.
"Parent" means Charter Communications, Inc. and/or Charter
Communications Holding Company, LLC, as applicable, and any successor Person or
any Person succeeding to the direct or indirect ownership of the Company.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Investments" means:
(1) any Investment by the Company in a Restricted Subsidiary of
the Company, or any Investment by a Restricted Subsidiary of the
Company in the Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary of
the Company in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of the
Company; or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to,
or is liquidated into, the Company or a Restricted Subsidiary of
the Company;
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.11;
16
(5) any Investment made out of the net cash proceeds of the issue
and sale since March 17, 1999 (other than to a Subsidiary of the
Company) of Equity Interests (other than Disqualified Stock) of the
Company to the extent that (a) such net cash proceeds have not been
applied to make a Restricted Payment or to effect other transactions
pursuant to Section 4.07 or (b) such net cash proceeds have not been
used to incur Indebtedness pursuant to clause (10) of Section 4.10;
(6) Investments in Productive Assets having an aggregate fair
market value (measured on the date each such Investment was made and
without giving effect to subsequent changes in value), when taken
together with all other Investments in Productive Assets made by the
Company and its Restricted Subsidiaries pursuant to this clause (6)
since March 17, 1999, not to exceed $150 million; provided that either
the Company or any of its Restricted Subsidiaries, after giving effect
to such Investments, will own at least 20% of the Voting Stock of any
Person in which any such Investment is made;
(7) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and
without giving effect to subsequent changes in value), when taken
together with all other Investments in any Person made by the Company
and its Restricted Subsidiaries pursuant to this clause (7) since
March 17, 1999, not to exceed $50 million; and
(8) Investments in customers and suppliers in the ordinary course
of business which either (A) generate accounts receivable or (B) are
accepted in settlement of bona fide disputes.
"Permitted Liens" means:
(1) Liens on the assets of the Company securing Indebtedness and
other Obligations under clause (1) of Section 4.10;
(2) Liens in favor of the Company;
(3) Liens on property of a Person existing at the time such
Person is merged with or into or consolidated with the Company;
provided that such Liens were in existence prior to the contemplation
of such merger or consolidation and do not extend to any assets other
than those of the Person merged into or consolidated with the Company;
(4) Liens on property existing at the time of acquisition thereof
by the Company; provided that such Liens were in existence prior to
the contemplation of such acquisition;
17
(5) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of business;
(6) purchase money mortgages or other purchase money liens
(including without limitation any Capital Lease Obligations) incurred
by the Company upon any fixed or capital assets acquired after the
Issue Date or purchase money mortgages (including without limitation
Capital Lease Obligations) on any such assets, whether or not assumed,
existing at the time of acquisition of such assets, whether or not
assumed, so long as (i) such mortgage or lien does not extend to or
cover any of the assets of the Company, except the asset so developed,
constructed, or acquired, and directly related assets such as
enhancements and modifications thereto, substitutions, replacements,
proceeds (including insurance proceeds), products, rents and profits
thereof, and (ii) such mortgage or lien secures the obligation to pay
the purchase price of such asset, interest thereon and other charges,
costs and expenses (including, without limitation, the cost of design,
development, construction, acquisition, transportation, installation,
improvement, and migration) and is incurred in connection therewith
(or the obligation under such Capital Lease Obligation) only;
(7) Liens existing on the Issue Date (other than in connection
with the Credit Facilities);
(8) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and diligently
concluded; provided that any reserve or other appropriate provision as
shall be required in conformity with GAAP shall have been made
therefor;
(9) statutory and common law Liens of landlords and carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other
similar Liens arising in the ordinary course of business and with
respect to amounts not yet delinquent or being contested in good faith
by appropriate legal proceedings promptly instituted and diligently
conducted and for which a reserve or other appropriate provision, if
any, as shall be required in conformity with GAAP shall have been
made;
(10) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security;
(11) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligation, bankers'
acceptance, surety and appeal bonds, government contracts, performance
and return-of-money bonds and other
18
obligations of a similar nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money);
(12) easements, rights-of-way, municipal and zoning ordinances
and similar charges, encumbrances, title defects or other
irregularities that do not materially interfere with the ordinary
course of business of the Company or any of its Restricted
Subsidiaries;
(13) Liens of franchisors or other regulatory bodies arising in
the ordinary course of business;
(14) Liens arising from filing Uniform Commercial Code financing
statements regarding leases or other Uniform Commercial Code financing
statements for precautionary purposes relating to arrangements not
constituting Indebtedness;
(15) Liens arising from the rendering of a final judgment or
order against the Company or any of its Restricted Subsidiaries that
does not give rise to an Event of Default;
(16) Liens securing reimbursement obligations with respect to
letters of credit that encumber documents and other property relating
to such letters of credit and the products and proceeds thereof;
(17) Liens encumbering customary initial deposits and margin
deposits, and other Liens that are within the general parameters
customary in the industry and incurred in the ordinary course of
business, in each case, securing Indebtedness under Hedging
Obligations and forward contracts, options, future contracts, future
options or similar agreements or arrangements designed solely to
protect the Company or any of its Restricted Subsidiaries from
fluctuations in interest rates, currencies or the price of
commodities;
(18) Liens consisting of any interest or title of licensor in the
property subject to a license;
(19) Liens on the Capital Stock of Unrestricted Subsidiaries;
(20) Liens arising from sales or other transfers of accounts
receivable which are past due or otherwise doubtful of collection in
the ordinary course of business;
(21) Liens incurred in the ordinary course of business of the
Company with respect to obligations which in the aggregate do not
exceed $50 million at any one time outstanding;
19
(22) Liens in favor of the Trustee arising under the provisions
in this Indenture and in the indentures relating to the Other Notes,
in each case under Section 7.07; and
(23) Liens in favor of the Trustee for its benefit and the
benefit of Holders and the holders of the Other Notes, as their
respective interests appear.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund, other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that unless permitted otherwise
by this Indenture, no Indebtedness of the Company or any of its Restricted
Subsidiaries may be issued in exchange for, nor may the net proceeds of
Indebtedness be used to extend, refinance, renew, replace, defease or refund,
Indebtedness of the Company or any of its Restricted Subsidiaries; provided,
further, that:
(1) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal
amount of (or accreted value, if applicable), plus accrued interest
and premium, if any, on the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded (plus the amount of reasonable
expenses incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and has a Weighted Average
Life to Maturity equal to or greater than the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to
the Notes, such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and is
subordinated in right of payment to, the Notes on terms at least as
favorable to the Holders of Notes as those contained in the
documentation governing the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company or by any
of its Restricted Subsidiaries who is the obligor on the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, limited liability company, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
20
"Preferred Stock," as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) which by its
terms is preferred in right of payment of dividends, or as to the distribution
of assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over shares of Capital Stock of any other class of such Person.
"Principal" means Paul G. Allen.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i)(A) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"Productive Assets" means assets (including assets of a referent
Person owned directly or indirectly through ownership of Capital Stock) of a
kind used or useful in the Cable Related Business.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Stock.
"Rating Agencies" means Moody's and S&P.
"Registration Rights Agreement" means (a) the Exchange and
Registration Rights Agreement dated as of the Issue Date among the Issuers and
the initial purchasers named therein with respect to the Initial Notes and (b)
any registration rights agreement among the Issuers and the initial purchasers
named therein with respect to any Initial Additional Notes.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means a global note substantially in the
form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee that will be issued in an initial denomination
equal to the outstanding principal amount of the Initial Notes or any Initial
Additional Notes, in each case initially sold in reliance on Rule 903 of
Regulation S.
"Related Party" means:
(1) the spouse or an immediate family member, estate or heir of
the Principal;
or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially
holding an 80% or more
21
controlling interest of which consist of the
Principal and/or such other Persons referred to in the immediately
preceding clause (1).
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 144A Global Note" means a global note substantially in the
form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee that will be issued in an initial denomination
equal to the outstanding principal amount of the Initial Notes or any Initial
Additional Notes, in each case initially sold in reliance on Rule 144A.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"S&P" means Standard & Poor's Ratings Service, a division of the
McGraw-Hill Companies, Inc. or any successor to the rating agency business
thereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" means a "shelf" registration
statement providing for the registration and the sale on a continuous or delayed
basis of the Initial Notes or any Initial Additional Notes as may be provided in
any Registration Rights Agreement.
22
"Significant Subsidiary" means any Restricted Subsidiary of the
Company which is a "Significant Subsidiary" as defined in Rule 1-02(w) of
Regulation S-X under the Exchange Act.
"Special Interest" means special or additional interest in respect
of the Notes that is payable by the Issuers as liquidated damages upon specified
registration defaults pursuant to any Registration Rights Agreement.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness on the Issue Date, or, if none, the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association or other business entity of
which at least 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency)
to vote in the election of directors, managers or trustees thereof is
at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a
combination thereof) and, in the case of any such entity of which 50%
of the total voting power of shares of Capital Stock is so owned or
controlled by such Person or one or more of the other Subsidiaries of
such Person, such Person and its Subsidiaries also have the right to
control the management of such entity pursuant to contract or
otherwise; and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person
or (b) the only general partners of which are such Person or of one or
more Subsidiaries of such Person (or any combination thereof).
"Tax" shall mean any tax, duty, levy, impost, assessment or other
governmental charge (including penalties, interest and any other liabilities
related thereto).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA; provided, however, that in the event the Trust Indenture Act of
1939 is amended after such date, then "TIA" means, to the extent required by
such amendment, the Trust Indenture Act of 1939 as so amended.
"Trustee" means BNY Midwest Trust Company until a successor replaces
BNY Midwest Trust Company in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
23
"Unrestricted Definitive Note" means one or more Definitive Notes
that do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global note
substantially in the form of Exhibit A attached hereto that bears the Global
Note Legend and that has the "Schedule of Exchanges of Interests in the Global
Note" attached thereto, and that is deposited with or on behalf of and
registered in the name of the Depositary, representing a series of Notes that do
not bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that
is designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that such
Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement
or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Company unless such terms
constitute Investments permitted under Section 4.08;
(3) is a Person with respect to which neither the Company nor any
of its Restricted Subsidiaries has any direct or indirect obligation
(a) to subscribe for additional Equity Interests or (b) to maintain or
preserve such Person's financial condition or to cause such Person to
achieve any specified levels of operating results;
(4) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries; and
(5) has at least one director on its board of directors that is
not a director or executive officer of the Company or any of its
Restricted Subsidiaries or has at least one executive officer that is
not a director or executive officer of the Company or any of its
Restricted Subsidiaries.
"U.S. Person" means a U.S. person as defined in Rule 902(k) under
the Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock
of such Person that is at the time entitled to vote in the election of the board
of directors of such Person.
24
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such
date and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person and/or by one or more Wholly Owned
Restricted Subsidiaries of such Person.
Section 1.02. Other Definitions.
Defined in
Term Section
- ---- -------
"Affiliate Transaction".............................. 4.13
"Asset Sale Offer"................................... 3.09
"Authentication Order"............................... 2.02
"Change of Control Offer"............................ 4.16
"Change of Control Payment".......................... 4.16
"Change of Control Payment Date"..................... 4.16
"Covenant Defeasance"................................ 8.03
"DTC"................................................ 2.03
"Event of Default"................................... 6.01
"Excess Proceeds".................................... 4.11
"incur".............................................. 4.10
"Legal Defeasance"................................... 8.02
"Offer Amount"....................................... 3.09
"Offer Period"....................................... 3.09
"Paying Agent"....................................... 2.03
"Payment Default".................................... 6.01
"Permitted Debt".................................... 4.10
"Preferred Stock Financing".......................... 4.10
"Purchase Date"...................................... 3.09
"Registrar".......................................... 2.03
"Restricted Payments"................................ 4.07
25
Defined in
Term Section
- ---- -------
"Subordinated Debt Financing"........................ 4.10
"Subordinated Notes"................................. 4.10
"Subsidiary Guarantee"............................... 4.17
"Suspended Covenants"................................ 4.19
- -------------------------------------------------------------------------------
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
and
"obligor" on the Notes means the Issuers and any successor obligor
upon the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural
include the singular;
(e) provisions apply to successive events and transactions;
26
(f) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement of successor sections or
rules adopted by the SEC from time to time;
(g) references to any statute, law, rule or regulation shall be
deemed to refer to the same as from time to time amended and in effect and to
any successor statute, law, rule or regulation; and
(h) references to any contract, agreement or instrument shall mean
the same as amended, modified, supplemented or amended and restated from time to
time, in each case, in accordance with any applicable restrictions contained in
this Indenture.
ARTICLE 2
THE NOTES
---------
Section 2.01. Form and Dating.
(a) General. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto. The Notes
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Each Note shall be dated the date of its authentication. The Notes
shall be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute,
and are hereby expressly made, a part of this Indenture and the Issuers and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially
in the form of Exhibit A attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or
27
decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee or the custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as required
by Section 2.06.
(c) Euroclear and Clearstream Procedures Applicable. The provisions
of the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream (or, in each case,
equivalent documents setting forth the procedures of Euroclear and
Clearstream)shall be applicable to transfers of beneficial interests in the
Regulation S Global Notes that are held by Participants through Euroclear or
Clearstream.
Section 2.02. Execution and Authentication.
Two Officers shall sign the Notes for each Issuer by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid until authenticated by the manual
signature (which may be by facsimile) of the Trustee. The signature shall be
conclusive evidence that the Note has been authenticated under this Indenture.
At any time and from time to time after the execution and delivery
of this Indenture, the Issuers may deliver Notes executed by the Issuers to the
Trustee for authentication; and the Trustee shall authenticate and deliver (i)
Initial Notes for original issue in the aggregate principal amount of
$575,000,000, (ii) Additional Notes from time to time for original issue in
aggregate principal amount specified by the Issuers and (iii) Exchange Notes
from time to time for issue in exchange for a like principal amount of Initial
Notes or Initial Additional Notes, in each case specified in clauses (i) through
(iii) above, upon a written order of the Issuers signed by an Officer of each of
the Issuers (an "Authentication Order"). Such Authentication Order shall specify
the amount of Notes to be authenticated and the date on which the Notes are to
be authenticated, whether such notes are to be Initial Notes, Additional Notes
or Exchange Notes and whether the Notes are to be issued as one or more Global
Notes and such other information as the Issuers may include or the Trustee may
reasonably request. The aggregate principal amount of Notes which may be
authenticated and delivered under this Indenture is unlimited.
On the Issue Date, the Issuers will issue $575,000,000 aggregate
principal amount of Initial Notes. Initial Notes and any Initial Additional
Notes offered and sold in reliance on the exemption from registration under the
Securities Act provided by Section 4(2) thereunder or Rule 144A shall be issued
as one or more Rule 144A Global Notes.
28
Initial Notes and any Initial Additional Notes offered and sold in offshore
transactions in reliance on Regulation S shall be issued as one or more
Regulation S Global Notes.
The Trustee may appoint an authenticating agent acceptable to the
Issuers to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Issuers.
Section 2.03. Registrar and Paying Agent.
The Issuers shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Issuers may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Issuers may change any
Paying Agent or Registrar without notice to any Holder. The Issuers shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Issuers fail to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Issuers or any of
their Subsidiaries may act as Paying Agent or Registrar.
The Issuers initially appoint The Depository Trust Company ("DTC")
to act as Depositary with respect to the Global Notes.
The Issuers initially appoint the Trustee to act as the Registrar
and Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
The Issuers shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Issuers in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Issuers at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Issuers or a Subsidiary) shall have no further
liability for the money. If the Issuers or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Issuers, the Trustee shall serve as Paying Agent for
the Notes.
29
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Issuers shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Issuers shall otherwise comply with TIA ss. 312(a).
Section 2.06. Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes shall be exchanged
by the Company for Definitive Notes if:
(i) the Issuers deliver to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange
Act and, in either case, a successor Depositary is not appointed by
the Issuers within 120 days after the date of such notice from the
Depositary; or
(ii)the Issuers in their sole discretion determine that the
Global Notes (in whole but not in part) should be exchanged for
Definitive Notes and deliver a written notice to such effect to the
Trustee; or
(iii) there shall have occurred and be continuing a Default or
Event of Default with respect to the Notes.
Upon the occurrence of any of the preceding events in (i), (ii) or
(iii) above, Definitive Notes shall be issued in such names as the Depositary
shall instruct the Trustee. Global Notes also may be exchanged or replaced, in
whole or in part, as provided in Sections 2.07 and 2.10. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10, shall be
authenticated and delivered in the form of, and shall be, a Global Note. A
Global Note may not be exchanged for another Note other than as provided in this
Section 2.06(a); however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f).
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through
30
the Depositary, in accordance with the provisions of this Indenture and the
Applicable Procedures. Beneficial interests in the Restricted Global Notes shall
be subject to restrictions on transfer comparable to those set forth herein to
the extent required by the Securities Act. Prior to the expiration of the 40-day
distribution compliance period set forth in Regulation S, beneficial interests
in any Regulation S Global Note may be held only through Euroclear or
Clearstream unless transferred in accordance with Section 2.06(b)(iii)(A).
Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend.
Beneficial interests in any Unrestricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders
or instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above,
the transferor of such beneficial interest must deliver to the
Registrar either:
(A)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to credit or cause
to be credited a beneficial interest in another Global Note in an
amount equal to the beneficial interest to be transferred or
exchanged; and
(A)(2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant
account to be credited with such increase; or
(B)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be
issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged; and
(B)(2) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above.
31
Upon consummation of an Exchange Offer by the Issuers in accordance
with Section 2.06(f), the requirements of this Section 2.06(b)(ii)
shall be deemed to have been satisfied upon receipt by the Registrar
of the instructions contained in the Letter of Transmittal delivered
by the holder of such beneficial interests in the Restricted Global
Notes. Upon satisfaction of all of the requirements for transfer or
exchange of beneficial interests in Global Notes contained in this
Indenture and the Notes or otherwise applicable under the Securities
Act, the Trustee shall adjust the principal amount of the relevant
Global Note(s) pursuant to Section 2.06(h).
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may
be transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the Rule 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof.
(iv)Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in an Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global
Note or transferred to a Person who takes delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note if the
exchange or transfer complies with the requirements of Section
2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in
the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that
it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the relevant Exchange Notes or (3) a Person who
is an affiliate (as defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
32
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph
(B) or (D) above at a time when an Unrestricted Global Note has
not yet been issued, the Issuers shall issue and, upon receipt of
an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate one or more Unrestricted Global Notes
in an aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof
in the form of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for
Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
Restricted Definitive Note, then, upon receipt by the Registrar of the
following documentation:
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(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof (provided that any such
beneficial interest in Regulation S Global Note shall not be so
exchangeable until after the expiration of the 40-day
distribution compliance period set forth in Regulation S);
(B) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other
than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3)(d) thereof, if applicable;
(F) if such beneficial interest is being transferred to the
Issuers or any of their Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in
item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.06(h), and the Issuers shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions
a Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c) shall be registered in
such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest
34
shall instruct the Registrar through instructions from the Depositary
and the Participant or Indirect Participant. The Trustee shall deliver
such Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section
2.06(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement
and the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies
in the applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the relevant Exchange Notes or (3) a Person who is an affiliate
(as defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit B hereto, including the certifications in item (4)
thereof;
35
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section
2.06(b)(ii), the Trustee shall cause the aggregate principal amount of
the applicable Global Note to be reduced accordingly pursuant to
Section 2.06(h), and the Issuers shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions
a Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall be registered in such name or names and in
such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions
from the Depositary and the Participant or Indirect Participant. The
Trustee shall deliver such Definitive Notes to the Persons in whose
names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section
2.06(c)(iii) shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests in Global Notes.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive Notes
to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred
to a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
36
(C) if such Restricted Definitive Note is being transferred
to a Non-U.S. Person in an offshore transaction in accordance
with Rule 903 or Rule 904 under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred
to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D)
above, a certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such Restricted Definitive Note is being transferred
to the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased the aggregate principal amount of, in the case
of clause (A) above, the appropriate Restricted Global Note, in the
case of clause (B) above, the Rule 144A Global Note, in the case of
clause (C) above, the Regulation S Global Note.
(ii)Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Restricted Definitive Note to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the relevant Exchange Notes
or (3) a Person who is an affiliate (as defined in Rule 144) of
the Issuers;
37
(B) such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with a
Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof
in the form of a beneficial interest in the Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to
the Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend
are no longer required in order to maintain compliance with the
Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(ii), the Trustee shall cancel the Definitive
Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
the Issuers shall issue and, upon receipt
38
of an Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate principal
amount equal to the principal amount of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes.
Any Restricted Definitive Note may be transferred to and registered in
the name of Persons who take delivery thereof in the form of a
Restricted Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item
(2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable.
(ii)Restricted Definitive Notes to Unrestricted Definitive Notes.
Any Restricted Definitive Note may be exchanged by the Holder thereof
for an Unrestricted Definitive Note or transferred to a Person or
Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with a Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the relevant Exchange Notes
or (3) a Person who is an affiliate (as defined in Rule 144) of
the Issuers;
39
(B) any such transfer is effected pursuant to a Shelf
Registration Statement in accordance with a Registration Rights
Agreement;
(C) any such transfer is effected by a broker-dealer
pursuant to an Exchange Offer Registration Statement in
accordance with a Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Issuers to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of an Exchange Offer in
accordance with a Registration Rights Agreement, the Issuers shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the relevant
Exchange Notes and (z) they are not affiliates (as defined in Rule 144) of the
Issuers, and accepted for exchange in the relevant Exchange Offer and (ii)
Definitive Notes in an
40
aggregate principal amount equal to the principal amount of the Restricted
Definitive Notes accepted for exchange in the relevant Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Issuers shall execute and the Trustee shall
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Definitive Notes in the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend
in substantially the following form:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
(A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (3) TO AN INSTITUTIONAL ACCREDITED
INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT SUBJECT TO THE CERTIFICATION
AND DELIVERY REQUIREMENTS OF THE INDENTURE GOVERNING THE NOTES,
(4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR
(5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv),
(c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii),
41
(e)(iii) or (f) to this Section 2.06 (and all Notes issued in
exchange therefor or substitution thereof) shall not bear the
Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO
ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY
MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07
OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE ISSUERS."
(h) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11. At any
time prior to such cancellation, if any beneficial interest in a Global Note is
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note or for Definitive Notes,
the principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depositary at the direction of the Trustee to reflect such reduction;
and if the beneficial interest is being exchanged for or transferred to a Person
who will take delivery thereof in the form of a beneficial interest in another
Global Note, such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Issuers shall execute and the Trustee shall authenticate Global Notes
and Definitive Notes upon the Issuers' order or at the Registrar's
request.
42
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Issuers may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any
such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.11, 4.16
and 9.05).
(iii) The Registrar shall not be required to register the
transfer of or exchange any Note selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in
part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Issuers, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
(v) The Issuers shall not be required (A) to issue, to register
the transfer of or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of
Notes for redemption under Section 3.02 and ending at the close of
business on the day of selection, (B) to register the transfer of or
to exchange any Note so selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part or
(C) to register the transfer of or to exchange a Note between a record
date and the next succeeding Interest Payment Date.
(vi)Prior to due presentment for the registration of a transfer
of any Note, the Trustee, any Agent and the Issuers may deem and treat
the Person in whose name any Note is registered as the absolute owner
of such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the
Trustee, any Agent or the Issuers shall be affected by notice to the
contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be submitted
by facsimile.
Section 2.07. Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Issuers
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Note, the
43
Issuers shall issue and the Trustee, upon receipt of an Authentication Order,
shall authenticate a replacement Note if the Trustee's requirements are met. If
required by the Trustee or the Issuers, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and the Issuers to
protect the Issuers, the Trustee, any Agent and any authenticating agent from
any loss that any of them may suffer if a Note is replaced. The Issuers may
charge for their expenses in replacing a Note.
Every replacement Note is an additional legally binding obligation
of the Issuers and shall be entitled to all of the benefits of this Indenture
equally and proportionately with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions of this Indenture, and those described
in this Section as not outstanding. Except as set forth in Section 2.09, a Note
does not cease to be outstanding because either of the Issuers or an Affiliate
of the Issuers holds the Note; however, Notes held by an Issuer or a Subsidiary
of an Issuer shall not be deemed to be outstanding for purposes of Section
3.07(b).
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
4.01, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than an Issuer, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.09. Treasury Notes.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by an
Issuer, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with an Issuer, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that a Responsible Officer of the Trustee knows are so owned shall be
so disregarded.
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Section 2.10. Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Issuers may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Issuers
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Issuers shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture.
Section 2.11. Cancellation.
The Issuers at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
such canceled Notes in its customary manner. The Issuers may not issue new Notes
to replace Notes that they have paid or that have been delivered to the Trustee
for cancellation.
Section 2.12. Defaulted Interest.
If the Issuers default in a payment of interest on the Notes, they
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01. The Issuers shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Issuers shall fix or cause to be fixed
each such special record date and payment date; provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Issuers (or, upon the written request of the Issuers, the Trustee in the name
and at the expense of the Issuers) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
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ARTICLE 3
REDEMPTION AND PREPAYMENT
-------------------------
Section 3.01. Notices to Trustee.
If the Issuers elect to redeem Notes pursuant to the optional
redemption provisions of Section 3.07, it shall furnish to the Trustee, at least
30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the clause of this Indenture pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
Section 3.02. Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee shall select the Notes to be redeemed
or purchased among the Holders of the Notes in compliance with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and appropriate. In
the event of partial redemption by lot, the particular Notes to be redeemed
shall be selected, unless otherwise provided herein, not less than 30 nor more
than 60 days prior to the redemption date by the Trustee from the outstanding
Notes not previously called for redemption.
The Trustee shall promptly notify the Issuers in writing of the
Notes selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption.
Subject to the provisions of Section 3.09, at least 30 days but not
more than 60 days before a redemption date, the Issuers shall mail or cause to
be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
46
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Issuers default in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Issuers' request, the Trustee shall give the notice of
redemption in the Issuers' name and at their expense; provided, however, that
each of the Issuers shall have delivered to the Trustee, at least 45 days prior
to the redemption date, an Officers' Certificate requesting that the Trustee
give such notice and setting forth the information to be stated in such notice
as provided in the preceding paragraph.
Section 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.
Section 3.05. Deposit of Redemption Price.
At or prior to 10:00 a.m., New York City time, on the redemption
date, the Issuers shall deposit with the Trustee or with the Paying Agent money
sufficient to pay the redemption price of and accrued interest on all Notes to
be redeemed on that date. The Trustee or the Paying Agent shall promptly return
to the Issuers any money deposited with the Trustee or the Paying Agent by the
Issuers in excess of the amounts necessary to pay the redemption price of, and
accrued interest on, all Notes to be redeemed.
If the Issuers comply with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes
47
called for redemption. If a Note is redeemed on or after an interest record date
but on or prior to the related interest payment date, then any accrued and
unpaid interest shall be paid to the Person in whose name such Note was
registered at the close of business on such record date. If any Note called for
redemption shall not be so paid upon surrender for redemption because of the
failure of the Issuers to comply with the preceding paragraph, interest shall be
paid on the unpaid principal, from the redemption date until such principal is
paid, and to the extent lawful on any interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Issuers shall
issue and, upon the Issuers' written request, the Trustee shall authenticate for
the Holder at the expense of the Issuers a new Note equal in principal amount to
the unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.07, the
Issuers shall not have the option to redeem the Notes pursuant to this Section
3.07 prior to May 15, 2006. Thereafter, the Issuers shall have the option to
redeem the Notes, in whole or in part, upon not less than 30 nor more than 60
days' notice, at the redemption prices (expressed as percentages of principal
amount) set forth below plus accrued and unpaid interest thereon, if any, to the
applicable redemption date, if redeemed during the twelve-month period beginning
on May 15 of the years indicated below:
Year Percentage
---- ----------
2006 105.000%
2007 103.333%
2008 101.667%
2009 and thereafter 100.000%
(b) Notwithstanding the provisions of clause (a) of this Section
3.07, at any time prior to May 15, 2004, the Issuers may, on any one or more
occasions, redeem up to 35% of the original aggregate principal amount of the
Notes (including the principal amount of any Additional Notes) issued under this
Indenture on a pro rata basis (or nearly as pro rata as practicable) at a
redemption price of 110.000% of the principal amount thereof, plus accrued and
unpaid interest to the redemption date, with the net cash proceeds of one or
more Equity Offerings; provided that
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(1) at least 65% of the original aggregate principal amount of
Notes (including the principal amount of any Additional Notes) issued
under this Indenture remains outstanding immediately after the
occurrence of such redemption (excluding Notes held by the Company and
its Subsidiaries); and
(2) the redemption must occur within 60 days of the date of the
closing of such Equity Offering.
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06.
Section 3.08. Mandatory Redemption.
Except as otherwise provided in Section 4.11 or Section 4.16 below,
the Issuers shall not be required to make mandatory redemption payments with
respect to the Notes.
Section 3.09. Offer to Purchase by Application of Excess Proceeds.
In the event that the Issuers shall be required to commence an offer
to all Holders to purchase Notes pursuant to Section 4.11 (an "Asset Sale
Offer"), they shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later than
five Business Days after the termination of the Offer Period (the "Purchase
Date"), the Issuers shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.11 (the "Offer Amount") or, if less than the
Offer Amount has been tendered, all Notes tendered in response to the Asset Sale
Offer. Payment for any Notes so purchased shall be made in the same manner as
interest payments are made. Unless the Issuers default in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest after the Purchase Date.
If the Purchase Date is on or after an interest record date and on
or before the related interest payment date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no Special Interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer the Issuers shall send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
49
(a) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.11 and the length of time the Asset Sale Offer shall remain
open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall
continue to accrue interest;
(d) that, unless the Issuers default in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer or may elect to have Notes purchased in integral multiples of
$1,000 only;
(f) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Issuers, a depositary, if appointed by
the Issuers, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Issuers, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Issuers shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuers so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Issuers shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Issuers in accordance
with the terms of this Section 3.09. The Issuers, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not
50
later than five days after the Purchase Date) mail or deliver to each tendering
Holder an amount equal to the purchase price of the Notes tendered by such
Holder and accepted by the Issuers for purchase, and the Issuers shall promptly
issue a new Note, and the Trustee, upon written request from the Issuers shall
authenticate and mail or deliver such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered. Any Note not so
accepted shall be promptly mailed or delivered by the Issuers to the Holder
thereof. The Issuers shall publicly announce the results of the Asset Sale Offer
on the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Sections 3.01 through 3.06.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Issuers shall pay or cause to be paid the principal, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Issuers or a Subsidiary thereof,
holds as of 10:00 a.m. New York City time on the due date money deposited by the
Issuers in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due. The Issuers shall pay all
Special Interest, if any, in the same manner on the dates and in the amounts set
forth in any Registration Rights Agreement.
The Issuers shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate equal
to 1% per annum in excess of the then applicable interest rate on the Notes to
the extent lawful; they shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02. Maintenance of Office or Agency.
The Issuers shall maintain in the Borough of Manhattan, The City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for redemption, repurchase, registration of transfer or for exchange
and where notices and demands to or upon the Issuers in respect of the Notes and
this Indenture may be served. The Issuers shall give prompt written notice to
the Trustee of the location, and any change in the location, of
51
such office or agency. If at any time the Issuers shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office of the Trustee.
The Issuers may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Issuers of their obligation to maintain an office or agency in the Borough of
Manhattan, The City of New York for such purposes. The Issuers shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Issuers hereby designate The Bank of New York, an affiliate of
the Trustee, at 101 Barclay Street, New York, New York 10286, as one such office
or agency of the Issuers in accordance with Section 2.03.
Section 4.03. Reports.
Whether or not required by the Commission, so long as any Notes are
outstanding, the Issuers shall furnish to the Holders of Notes, within the time
periods specified in the Commission's rules and regulations:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q and 10-K
if the Issuers were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
section and, with respect to the annual information only, a report on the annual
financial statements by the Company's certified independent accountants; and
(2) all current reports that would be required to be filed with the
Commission on Form 8-K if the Issuers were required to file such reports.
If the Issuers have designated any of their Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding paragraph shall include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and in Management's Discussion and Analysis of Financial Condition and
Results of Operations, of the financial condition and results of operations of
the Company and its Restricted Subsidiaries separate from the financial
condition and results of operations of the Unrestricted Subsidiaries of the
Company.
52
In addition, whether or not required by the Commission, the Issuers
shall file a copy of all of the information and reports referred to in clauses
(1) and (2) above with the Commission for public availability within the time
periods specified in the Commission's rules and regulations, unless the
Commission will not accept such a filing, and make such information available to
securities analysts and prospective investors upon request.
Section 4.04. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year have been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03 above shall be accompanied by a
written statement of the Company's independent public accountants (each of whom
shall be a firm of established national reputation) that in making the
examination necessary for certification of such financial statements, nothing
has come to their attention that would lead them to believe that the Company has
violated any provisions of Article 4 or Article 5 or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation. In the
event that, after the Company has used its reasonable best efforts to obtain the
written statement of the Company's independent public accountants required by
the provisions of this paragraph, such statement cannot be obtained, the Company
shall deliver, in satisfaction of its obligations under this Section 4.04, an
Officers' Certificate (A) certifying that it has used its reasonable best
efforts to obtain such required statement but was unable to do so and (B)
attaching the written statement of the Company's accountants that the Company
received in lieu thereof.
53
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws.
Each of the Issuers covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or
usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and each of the
Issuers (to the extent that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants that it shall not, by resort
to any such law, hinder, delay or impede the execution of any power herein
granted to the Trustee, but shall suffer and permit the execution of every such
power as though no such law has been enacted.
Section 4.07. Restricted Payments.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted Subsidiaries'
Equity Interests (including, without limitation, any payment in connection with
any merger or consolidation involving the Company or any of its Restricted
Subsidiaries) or to the direct or indirect holders of the Company's or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other
than dividends or distributions payable (x) solely in Equity Interests (other
than Disqualified Stock) of the Company or (y), in the case of the Company and
its Restricted Subsidiaries, to the Company or a Restricted Subsidiary of the
Company);
(b) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the Company or any of its Restricted Subsidiaries) any Equity
Interests of the Company or any direct or indirect parent of the Company or any
Restricted Subsidiary of the Company (other than,
54
in the case of the Company and its Restricted Subsidiaries, any such Equity
Interests owned by the Company or any Restricted Subsidiary of the Company); or
(c) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value, any Indebtedness that is
subordinated to the Notes, except a payment of interest or principal at the
Stated Maturity thereof,
(all such payments and other actions set forth in clauses (a) through (c) above
being collectively referred to as "Restricted Payments"), unless, at the time of
and after giving effect to such Restricted Payment:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(2) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable quarter period, have
been permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Leverage Ratio test set forth in the first paragraph
of Section 4.10; and
(3) such Restricted Payment, together with the aggregate amount
of all other Restricted Payments made by the Company and each of its
Restricted Subsidiaries after March 17, 1999 (excluding Restricted
Payments permitted by clauses (2), (3), (4), (5), (6), (7) and (8) of
the next succeeding paragraph), shall not exceed, at the date of
determination, the sum of:
(a) an amount equal to 100% of the Consolidated EBITDA of the
Company since March 17, 1999 to the end of the Company's most
recently ended full fiscal quarter for which internal financial
statements are available, taken as a single accounting period, less
the product of 1.2 times the Consolidated Interest Expense of the
Company since March 17, 1999 to the end of the Company's most
recently ended full fiscal quarter for which internal financial
statements are available, taken as a single accounting period, plus
(b) an amount equal to 100% of Capital Stock Sale Proceeds
less any such Capital Stock Sale Proceeds used in connection with
(i) an Investment made pursuant to clause (5) of the definition of
"Permitted Investments" or (ii) the incurrence of Indebtedness
pursuant to clause (10) of Section 4.10, plus
(c) $100 million.
So long as no Default has occurred and is continuing or would be
caused thereby, the preceding provisions shall not prohibit:
55
(1) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would
have complied with the provisions of this Indenture;
2) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness of the Company in
exchange for, or out of the net proceeds of, the substantially
concurrent sale (other than to a Subsidiary of the Company) of Equity
Interests of the Company (other than Disqualified Stock); provided
that the amount of any such net cash proceeds that are utilized for
any such redemption, repurchase, retirement, defeasance or other
acquisition shall be excluded from clause (3) (b) of the preceding
paragraph;
(3) the defeasance, redemption, repurchase or other acquisition
of subordinated Indebtedness of the Company or any of its Restricted
Subsidiaries with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;
(4) regardless of whether a Default then exists, the payment of
any dividend or distribution to the extent necessary to permit direct
or indirect beneficial owners of shares of Capital Stock of the
Company to pay federal, state or local income tax liabilities that
would arise solely from income of the Company or any of its Restricted
Subsidiaries, as the case may be, for the relevant taxable period and
attributable to them solely as a result of the Company (and any
intermediate entity through which the holder owns such shares) or any
of its Restricted Subsidiaries being a limited liability company,
partnership or similar entity for federal income tax purposes;
(5) regardless of whether a Default then exists, the payment of
any dividend by a Restricted Subsidiary of the Company to the holders
of its common Equity Interests on a pro rata basis;
(6) the payment of any dividend on the Helicon Preferred Stock or
the redemption, repurchase, retirement or other acquisition of the
Helicon Preferred Stock in an amount not in excess of its aggregate
liquidation value;
(7) the repurchase, redemption or other acquisition or retirement
for value, or the payment of any dividend or distribution to the
extent necessary to permit the repurchase, redemption or other
acquisition or retirement for value, of any Equity Interests of the
Company or a Parent held by any member of the Company's or such
Parent's management pursuant to any management equity subscription
agreement or membership or stock option agreement in effect as of the
Issue Date; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not
exceed $10 million in any fiscal year of the Company; and
56
(8) payment of fees in connection with any acquisition, merger or
similar transaction in an amount that does not exceed an amount equal
to 1.25% of the transaction value of such acquisition, merger or
similar transaction.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or any of its
Restricted Subsidiaries pursuant to the Restricted Payment. The fair market
value of any assets or securities that are required to be valued by this
covenant shall be determined by the Board of Directors of the Company, whose
resolution with respect thereto shall be delivered to the Trustee. Such Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if the
fair market value exceeds $100 million. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.07 were
computed, together with a copy of any fairness opinion or appraisal required by
this Indenture.
Section 4.08. Investments.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) make any Restricted Investment; or
(2) allow any Restricted Subsidiary of the Company to become an
Unrestricted Subsidiary,
unless, in each case:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(2) the Company would, at the time of, and after giving effect
to, such Restricted Investment or such designation of a Restricted
Subsidiary as an Unrestricted Subsidiary, have been permitted to incur
at least $1.00 of additional Indebtedness pursuant to the Leverage
Ratio test set forth in the first paragraph of Section 4.10.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution of the Company giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by this Section 4.08.
If, at any time, any Unrestricted Subsidiary would fail to
57
meet the requirements as an Unrestricted Subsidiary described in the definition
of "Unrestricted Subsidiary," it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.10, the Company shall be in default.
The Board of Directors of the Company may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that such designation shall
be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the
Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (1) such Indebtedness is permitted under
Section 4.10 calculated on a pro forma basis as if such designation had occurred
at the beginning of the Reference Period; and (2) no Default or Event of Default
would be in existence following such designation.
Section 4.09. Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Company shall not, directly or indirectly, create or permit to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Company to:
(1) pay dividends or make any other distributions on its Capital
Stock to the Company or any of its Restricted Subsidiaries, or with
respect to any other interest or participation in, or measured by, its
profits, or pay any Indebtedness owed to the Company or any of its
Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its
Restricted Subsidiaries; or
(3) transfer any of its properties or assets to the Company or
any of its Restricted Subsidiaries.
However, the preceding restrictions shall not apply to encumbrances
or restrictions existing under or by reason of:
(1) Existing Indebtedness as in effect on the Issue Date
(including, without limitation, the Credit Facilities) and any
amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings thereof,
provided that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings are
no more restrictive, taken as a whole, with respect to such dividend
and other payment restrictions than those contained in such Existing
Indebtedness, as in effect on the Issue Date;
(2) this Indenture, the Notes and the Other Notes;
58
(3) applicable law;
(4) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries
as in effect at the time of such acquisition (except to the extent
such Indebtedness was incurred in connection with or in contemplation
of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person,
other than the Person, or the property or assets of the Person, so
acquired; provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be
incurred;
(5) customary non-assignment provisions in leases entered into in
the ordinary course of business and consistent with past practices;
(6) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions on the property
so acquired of the nature described in clause (3) of the preceding
paragraph;
(7) any agreement for the sale or other disposition of a
Restricted Subsidiary of the Company that restricts distributions by
such Restricted Subsidiary pending its sale or other disposition;
(8) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole,
than those contained in the agreements governing the Indebtedness
being refinanced;
(9) Liens securing Indebtedness otherwise permitted to be
incurred under Section 4.14 that limit the right of the Company or any
of its Restricted Subsidiaries to dispose of the assets subject to
such Lien;
(10) provisions with respect to the disposition or distribution
of assets or property in joint venture agreements and other similar
agreements entered into in the ordinary course of business;
(11) restrictions on cash or other deposits or net worth imposed
by customers under contracts entered into in the ordinary course of
business;
(12) restrictions contained in the terms of Indebtedness
permitted to be incurred under Section 4.10; provided that such
restrictions are no more restrictive than the terms contained in the
Credit Facilities as in effect on the Issue Date; and
(13) restrictions that are not materially more restrictive than
customary provisions in comparable financings and the management of
the Company determines
59
that such restrictions will not materially impair the Company's
ability to make payments as required under the Notes.
Section 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Company shall not issue any Disqualified Stock and shall not
permit any of its Restricted Subsidiaries to issue any shares of Preferred Stock
unless the Leverage Ratio would have been not greater than 8.75 to 1.0
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom) as if the additional Indebtedness had been incurred, or the
Disqualified Stock had been issued, as the case may be, at the beginning of the
most recently ended fiscal quarter.
So long as no Default shall have occurred and be continuing or would
be caused thereby, the first paragraph of this covenant shall not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the incurrence by the Company and its Restricted Subsidiaries
of Indebtedness under the Credit Facilities; provided that the
aggregate principal amount of all Indebtedness of the Company and its
Restricted Subsidiaries outstanding under all Credit Facilities after
giving effect to such incurrence does not exceed an amount equal to
$3.5 billion less the aggregate amount of all Net Proceeds of Asset
Sales applied by the Company or any of its Subsidiaries in the case of
an Asset Sale since March 17, 1999 to repay Indebtedness under a
Credit Facility pursuant to Section 4.11;
(2) the incurrence by the Company and its Restricted Subsidiaries
of Existing Indebtedness (other than the Credit Facilities);
(3) the incurrence on the Issue Date by the Company and its
Restricted Subsidiaries of Indebtedness represented by the Notes
(other than any Additional Notes) and the Other Notes;
(4)) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case,
incurred for the purpose of financing all or any part of the purchase
price or cost of construction or improvement (including, without
limitation, the cost of design, development, construction,
acquisition, transportation, installation, improvement, and migration)
of Productive Assets of the
60
Company or any of its Restricted Subsidiaries, in an aggregate
principal amount not to exceed $75 million at any time outstanding;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or
the net proceeds of which are used to refund, refinance or replace, in
whole or in part, Indebtedness (other than intercompany Indebtedness)
that was permitted by this Indenture to be incurred under the first
paragraph of this covenant or clauses (2) or (3) of this paragraph;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company
and any of its Wholly Owned Restricted Subsidiaries; provided that:
(a) if the Company is the obligor on such Indebtedness, such
Indebtedness must be expressly subordinated to the prior payment in
full in cash of all Obligations with respect to the Notes; and
(b) (i) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than the Company or a Wholly Owned Restricted
Subsidiary thereof and (ii) any sale or other transfer of any such
Indebtedness to a Person that is not either the Company or a Wholly
Owned Restricted Subsidiary thereof, shall be deemed, in each case,
to constitute an incurrence of such Indebtedness by the Company or
any of its Restricted Subsidiaries that was not permitted by this
clause (6);
(7) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose
of fixing or hedging interest rate risk with respect to any floating
rate Indebtedness that is permitted by the terms of this Indenture to
be outstanding;
(8) the guarantee by the Company of Indebtedness of a Restricted
Subsidiary of the Company that was permitted to be incurred by another
provision of this Section 4.10;
(9) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal
amount at any time outstanding not to exceed $300 million;
(10) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal
amount at any time outstanding not to exceed 200% of the net cash
proceeds received by the Company from the sale of its Equity Interests
(other than Disqualified Stock) after March 17, 1999 to the extent
such net cash proceeds have not been applied to make Restricted
Payments or to
61
effect other transactions pursuant to Section 4.07 or to make
Permitted Investments pursuant to clause (5) of the definition
thereof; and
(11) the accretion or amortization of original issue discount and
the write up of Indebtedness in accordance with purchase accounting.
For purposes of determining compliance with this Section 4.10, in
the event that an item of proposed Indebtedness meets the criteria of more than
one of the categories of Permitted Debt described in clauses (1) through (11)
above, or is entitled to be incurred pursuant to the first paragraph of this
covenant, the Company shall be permitted to classify and from time to time to
reclassify such item of Indebtedness in any manner that complies with this
covenant. For avoidance of doubt, Indebtedness incurred pursuant to a single
agreement, instrument, program, facility or line of credit may be classified as
Indebtedness arising in part under one of the clauses listed above, and in part
under any one or more of the clauses listed above, to the extent that such
Indebtedness satisfies the criteria for such clauses.
Notwithstanding the foregoing, in no event shall any Restricted
Subsidiary of the Company consummate a Subordinated Debt Financing or a
Preferred Stock Financing. A "Subordinated Debt Financing" or a "Preferred Stock
Financing", as the case may be, with respect to any Restricted Subsidiary of the
Company shall mean a public offering or private placement (whether pursuant to
Rule 144A under the Securities Act or otherwise) of Subordinated Notes or
Preferred Stock (whether or not such Preferred Stock constitutes Disqualified
Stock), as the case may be, of such Restricted Subsidiary to one or more
purchasers (other than to one or more Affiliates of the Company). "Subordinated
Notes" with respect to any Restricted Subsidiary of the Company shall mean
Indebtedness of such Restricted Subsidiary that is contractually subordinated in
right of payment to any other Indebtedness of such Restricted Subsidiary
(including, without limitation, Indebtedness under the Credit Facilities). The
foregoing limitation shall not apply to (i) any Indebtedness or Preferred Stock
of any Person existing at the time such Person is merged with or into or became
a Subsidiary of the Company; provided that such Indebtedness or Preferred Stock
was not incurred or issued in connection with, or in contemplation of, such
Person merging with or into, or becoming a Subsidiary of, the Company and (ii)
any Indebtedness or Preferred Stock of a Restricted Subsidiary issued in
connection with, and as part of the consideration for, an acquisition, whether
by stock purchase, asset sale, merger or otherwise, in each case involving such
Restricted Subsidiary, which Indebtedness or Preferred Stock is issued to the
seller or sellers of such stock or assets; provided that such Restricted
Subsidiary is not obligated to register such Indebtedness or Preferred Stock
under the Securities Act or obligated to provide information pursuant to Rule
144A under the Securities Act.
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Section 4.11. Limitation on Asset Sales.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company or a Restricted Subsidiary of the Company, as the
case may be, receives consideration at the time of such Asset Sale at
least equal to the fair market value of the assets or Equity Interests
issued or sold or otherwise disposed of;
(2) such fair market value is determined by the Company's Board
of Directors and evidenced by a resolution of such Board of Directors
set forth in an Officers' Certificate delivered to the Trustee; and
(3) at least 75% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash, Cash
Equivalents or readily marketable securities.
For purposes of this Section 4.11, each of the following shall be
deemed to be cash:
(a) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet) of the Company or any Restricted
Subsidiary of the Company (other than contingent liabilities and liabilities
that are by their terms subordinated to the Notes) that are assumed by the
transferee of any such assets pursuant to a customary novation agreement that
releases the Company or such Restricted Subsidiary from further liability;
(b) any securities, notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee that are
converted by the Company or such Restricted Subsidiary into cash, Cash
Equivalents or readily marketable securities within 60 days after receipt
thereof (to the extent of the cash, Cash Equivalents or readily marketable
securities received in that conversion); and
(c) Productive Assets.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company or a Restricted Subsidiary of the Company, as the case may be,
may apply such Net Proceeds at its option:
(1) to repay debt under the Credit Facilities or any other
Indebtedness of the Restricted Subsidiaries of the Company (other than
Indebtedness represented by a guarantee of a Restricted Subsidiary of
the Company); or
63
(2) to invest in Productive Assets; provided that any Net
Proceeds which the Company or a Restricted Subsidiary of the Company,
as the case may be, has committed to invest in Productive Assets
within 365 days of the applicable Asset Sale may be invested in
Productive Assets within two years of such Asset Sale.
The amount of any Net Proceeds received by the Company or a
Restricted Subsidiary of the Company from Asset Sales that are not applied or
invested as provided in the preceding paragraph shall constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $25 million, the
Issuers shall make an Asset Sale Offer to all Holders of Notes and all holders
of other Indebtedness that is pari passu with the Notes containing provisions
requiring offers to purchase or redeem with the proceeds of sales of assets to
purchase the maximum principal amount of Notes and such other pari passu
Indebtedness that may be purchased out of the Excess Proceeds (which amount
includes the entire amount of the Net Proceeds). The offer price in any Asset
Sale Offer shall be payable in cash and equal to 100% of principal amount plus
accrued and unpaid interest, if any, to the date of purchase. If any Excess
Proceeds remain after consummation of an Asset Sale Offer, the Company or a
Restricted Subsidiary of the Company may use such Excess Proceeds for any
purpose not otherwise prohibited by this Indenture. If the aggregate principal
amount of Notes and such other pari passu Indebtedness tendered into such Asset
Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select the
Notes and such other pari passu Indebtedness to be purchased on a pro rata
basis. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds
shall be reset at zero.
In the event that the Issuers shall be required to commence an offer
to Holders to purchase Notes pursuant to this Section 4.11, they shall follow
the procedures specified in Section 3.09.
Section 4.12. Sale and Leaseback Transactions.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company may enter into a sale and leaseback transaction if:
(1) the Company could have (a) incurred Indebtedness in an amount
equal to the Attributable Debt relating to such sale and leaseback
transaction under the Leverage Ratio test in the first paragraph of
Section 4.10 and (b) incurred a Lien to secure such Indebtedness
pursuant to Section 4.14; and
(2) the transfer of assets in that sale and leaseback transaction
is permitted by, and the Company applies the proceeds of such
transaction in compliance with, Section 4.11.
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The foregoing restrictions shall not apply to a sale and leaseback
transaction if the lease is for a period, including renewal rights, of not in
excess of three years.
Section 4.13. Transactions with Affiliates.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each, an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(a) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $15 million, a resolution of the Board of Directors of
the Company set forth in an Officers' Certificate certifying that
such Affiliate Transaction complies with this Section 4.13 and that
such Affiliate Transaction has been approved by a majority of the
members of such Board of Directors; and
(b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $50 million, an opinion as to the fairness to the Holders
of such Affiliate Transaction from a financial point of view issued
by an accounting, appraisal or investment banking firm of national
standing.
The following items shall not be deemed to be Affiliate Transactions
and, therefore, shall not be subject to the provisions of the prior paragraph:
(1) any existing employment agreement entered into by the Company
or any of its Subsidiaries and any employment agreement entered into
by the Company or any of its Restricted Subsidiaries in the ordinary
course of business and consistent with the past practice of the
Company or such Restricted Subsidiary;
(2) transactions between or among the Company and/or its
Restricted Subsidiaries;
(3) payment of reasonable directors fees to Persons who are not
otherwise Affiliates of the Company and customary indemnification and
insurance
65
arrangements in favor of directors, regardless of affiliation with the
Company or any of its Restricted Subsidiaries;
(4) payment of management fees pursuant to management agreements
either (A) existing on the Issue Date or (B) entered into after the
Issue Date, to the extent that such management agreements provide for
percentage fees no higher than the percentage fees existing under the
management agreements existing on the Issue Date;
(5) Restricted Payments that are permitted by Section 4.07 and
Restricted Investments that are permitted by Section 4.08; and
(6) Permitted Investments.
Section 4.14. Liens.
The Company shall not, directly or indirectly, create, incur, assume
or suffer to exist any Lien of any kind securing Indebtedness, Attributable Debt
or trade payables on any asset now owned or hereafter acquired, except Permitted
Liens.
Section 4.15. Existence.
Subject to Article 5, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its limited
liability company existence, and the corporate, partnership or other existence
of each of its Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Subsidiary and (ii) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Subsidiaries
(other than Charter Capital), if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.16. Repurchase at the Option of Holders upon a Change of Control.
If a Change of Control occurs, each Holder of Notes shall have the
right to require the Issuers to repurchase all or any part (equal to $1,000 or
an integral multiple thereof) of that Holder's Notes pursuant to a Change of
Control Offer. In the Change of Control Offer, the Issuers shall offer (a
"Change of Control Offer") a payment (the "Change of Control Payment") in cash
equal to 101% of the aggregate principal amount of Notes repurchased plus
accrued and unpaid interest thereon, if any, to the date of purchase.
66
Within ten days following any Change of Control, the Issuers shall
mail a notice to each Holder (with a copy to the Trustee) describing the
transaction or transactions that constitute the Change of Control and stating:
(a) the purchase price and the purchase date, which shall not
exceed 30 Business Days from the date such notice is mailed (the
"Change of Control Payment Date");
(b) that any Note not tendered shall continue to accrue interest;
(c) that, unless the Issuers default in the payment of the Change
of Control Payment, all Notes accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the
Change of Control Payment Date;
(d) that Holders electing to have any Notes purchased pursuant to
a Change of Control Offer shall be required to surrender the Notes,
with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date;
(e) that Holders shall be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
second Business Day preceding the Change of Control Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Notes delivered for
purchase, and a statement that such Holder is withdrawing his election
to have the Notes purchased; and
(f) that Holders whose Notes are being purchased only in part
shall be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered, which unpurchased portion must be
equal to $1,000 in principal amount or an integral multiple thereof.
The Issuers shall comply with the requirements of Rule 14e-1 under
the Exchange Act (or any successor rules) and any other securities laws and
regulations thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of the Notes as a result of a Change of Control.
On the Change of Control Payment Date, the Issuers shall, to the
extent lawful:
(a) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer;
67
(b) deposit with the Paying Agent an amount equal to the Change
of Control Payment in respect of all Notes or portions thereof so
tendered; and
(c) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the aggregate
principal amount of Notes or portions thereof being purchased by the
Issuers.
The Paying Agent shall promptly pay to each Holder of Notes so
tendered the Change of Control Payment for such Notes, and the Trustee shall
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each such new Note shall be in a
principal amount of $1,000 or an integral multiple thereof. The Company shall
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
The provisions described above that require the Issuers to make a
Change of Control Offer following a Change of Control shall be applicable
regardless of whether or not any other provisions in this Indenture are
applicable. Except as described above with respect to a Change of Control, this
Indenture does not contain provisions that permit the Holders of the Notes to
require that the Issuers repurchase or redeem the Notes in the event of a
takeover, recapitalization or similar transaction.
Notwithstanding any other provision of this Section 4.16, the
Issuers shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Indenture applicable to a Change of Control Offer made by the Issuers and
purchases all Notes validly tendered and not withdrawn under such Change of
Control Offer.
Section 4.17. Limitations on Issuances of Guarantees of Indebtedness.
The Company shall not permit any of its Restricted Subsidiaries,
directly or indirectly, to Guarantee or pledge any assets to secure the payment
of any other Indebtedness of the Company, except in respect of the Credit
Facilities (the "Guaranteed Indebtedness") unless (i) such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture providing for the
Guarantee (a "Subsidiary Guarantee") of the payment of the Notes by such
Restricted Subsidiary and (ii) until one year after all the Notes have been paid
in full in cash, such Restricted Subsidiary waives and will not in any manner
whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary of the Company as a result of any payment by
such Restricted Subsidiary under its Subsidiary Guarantee; provided that this
paragraph shall not be applicable to any Guarantee or any Restricted Subsidiary
that existed at the time such
68
Person became a Restricted Subsidiary and was not incurred in connection with,
or in contemplation of, such Person becoming a Restricted Subsidiary. If the
Guaranteed Indebtedness is subordinated to the Notes, then the Guarantee of such
Guaranteed Indebtedness shall be subordinated to the Subsidiary Guarantee at
least to the extent that the Guaranteed Indebtedness is subordinated to the
Notes.
Section 4.18. Payments for Consent.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, pay or cause to be paid any consideration to or for
the benefit of any Holder of Notes for or as an inducement to any consent,
waiver or amendment of any of the terms or provisions of this Indenture or the
Notes unless such consideration is offered to be paid and is paid to all Holders
of the Notes that consent, waive or agree to amend in the time frame set forth
in the solicitation documents relating to such consent, waiver or agreement.
Section 4.19. Application of Fall-Away Covenants.
During any period of time that (a) the Notes have Investment Grade
Ratings from both Rating Agencies and (b) no Default or Event of Default has
occurred and is continuing, the Company and its Restricted Subsidiaries shall
not be subject to the provisions of Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12,
4.13 and clause (4) of the first paragraph of Section 5.01 (collectively, the
"Suspended Covenants"). In the event that the Company and its Restricted
Subsidiaries are not subject to the Suspended Covenants for any period of time
as a result of the preceding sentence and, subsequently, one or both of the
Rating Agencies withdraws its ratings or downgrades the ratings assigned to the
Notes below the required Investment Grade Ratings or a Default or Event of
Default occurs and is continuing, then the Company and its Restricted
Subsidiaries shall thereafter again be subject to the Suspended Covenants and
compliance with the Suspended Covenants with respect to the Restricted Payments
made after the time of such withdrawal, downgrade, Default or Event of Default
will be calculated in accordance with the terms of Section 4.07 as though such
covenant had been in effect during the entire period of time from the Issue
Date.
ARTICLE 5
SUCCESSORS
----------
Section 5.01. Merger, Consolidation, or Sale of Assets.
Neither of the Issuers may, directly or indirectly: (1) consolidate
or merge with or into another Person (whether or not such Issuer is the
surviving corporation); or (2) sell,
69
assign, transfer, convey or otherwise dispose of all or substantially all of its
properties or assets, in one or more related transactions, to another Person;
unless:
(1) either: (a) such Issuer is the surviving corporation; or (b) the
Person formed by or surviving any such consolidation or merger (if other than
such Issuer) or to which such sale, assignment, transfer, conveyance or other
disposition shall have been made is a Person organized or existing under the
laws of the United States, any state thereof or the District of Columbia
(provided that if the Person formed by or surviving any such consolidation or
merger with either Issuer is a limited liability company or a Person other than
a corporation, a corporate co-issuer shall also be an obligor with respect to
the Notes);
(2) the Person formed by or surviving any such consolidation or
merger (if other than the Company) or the Person to which such sale, assignment,
transfer, conveyance or other disposition shall have been made assumes all the
obligations of the Company under the Notes and this Indenture pursuant to
agreements reasonably satisfactory to the Trustee;
(3) immediately after such transaction no Default or Event of
Default exists; and
(4) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company) will, on the date of such
transaction after giving pro forma effect thereto and any related financing
transactions as if the same had occurred at the beginning of the applicable
four-quarter period, either (a) be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Leverage Ratio test set forth in the
first paragraph of Section 4.10 or (b) have a Leverage Ratio immediately after
giving effect to such consolidation or merger no greater than the Leverage Ratio
immediately prior to such consolidation or merger.
In addition, the Company may not, directly or indirectly, lease all
or substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 shall not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the Company and any of its Wholly Owned Subsidiaries.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of either Issuer in accordance with Section 5.01, the successor Person formed by
such consolidation or into which either Issuer is merged or to which such
transfer is made shall succeed to and (except in the case of a lease) be
substituted for, and may exercise every right and power of, such Issuer under
this Indenture with the same effect as if such successor Person had
70
been named therein as such Issuer, and (except in the case of a lease) such
Issuer shall be released from the obligations under the Notes and this
Indenture, except with respect to any obligations that arise from, or are
related to, such transaction.
ARTICLE 6
DEFAULTS AND REMEDIES
---------------------
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Issuers default in the payment when due of interest on the
Notes and such default continues for a period of 30 days;
(b) the Issuers default in payment when due of the principal of or
premium, if any, on the Notes;
(c) the Company or any of its Restricted Subsidiaries fails to
comply with any of the provisions of Sections 4.16 or 5.01;
(d) the Company or any of its Restricted Subsidiaries fails to
comply with any of their other covenants or agreements in this Indenture for 30
days after written notice thereof has been given to the Company by the Trustee
or to the Company and the Trustee by Holders of at least 25% of the aggregate
principal amount of the Notes outstanding;
(e) the Company or any of its Restricted Subsidiaries defaults under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed (or
the payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries) whether such Indebtedness or guarantee now exists or is created
after the Issue Date, if that default:
(1) is caused by a failure to pay at final stated maturity the
principal amount on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default
(a "Payment Default"); or
(2) results in the acceleration of such Indebtedness prior to its
express maturity,
and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under which
there has been a
71
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more;
(f) the Company or any of its Restricted Subsidiaries fails to pay
final judgments which are non-appealable aggregating in excess of $100 million
(net of applicable insurance which has not been denied in writing by the
insurer), which judgments are not paid, discharged or stayed for a period of 60
days;
(g) the Company or any of its Significant Subsidiaries pursuant to
or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in
an involuntary case,
(iii) consents to the appointment of a custodian of it or for all
or substantially all of its property, or
(iv) makes a general assignment for the benefit of its creditors;
or
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries in an involuntary case;
(ii) appoints a custodian of the Company or any of its
Significant Subsidiaries or for all or substantially all of the
property of the Company or any of its Significant Subsidiaries; or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02. Acceleration.
In the case of an Event of Default arising from clause (g) or (h) of
Section 6.01 with respect to the Company, all outstanding Notes shall become due
and payable immediately without further action or notice. If any other Event of
Default occurs and is continuing, the Trustee by notice to the Issuers or the
Holders of at least 25% in principal amount of the then outstanding Notes by
notice to the Issuers and the Trustee may declare all the Notes to be due and
payable immediately. The Holders of a majority in
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aggregate principal amount of the Notes then outstanding by written notice to
the Trustee may on behalf of all of the Holders rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default (except nonpayment of principal, interest
or premium that has become due solely because of the acceleration) have been
cured or waived.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Existing Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium, if any, or interest on, the Notes
(including in connection with an offer to purchase) (provided, however, that the
Holders of a majority in aggregate principal amount of the then outstanding
Notes may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration). Upon any such waiver,
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
Section 6.05. Control by Majority.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture, that the Trustee determines may be
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability. The Trustee may take any other action which it
deems proper that is not inconsistent with any such directive.
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Section 6.06. Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium, if any, and
interest on the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a) or (b) occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Issuers for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
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Section 6.09. Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Issuers
(or any other obligor upon the Notes), their creditors or their property and
shall be entitled and empowered to collect, receive and distribute any money or
other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 out of the
estate in any such proceeding, shall be denied for any reason, payment of the
same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07, including payment of all compensation, expense
and liabilities incurred, and all advances made, by the Trustee and
the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium, if any, and interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium, if any and interest,
respectively; and
Third: to the Issuers or to such party as a court of competent
jurisdiction shall direct.
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The Trustee may fix a record date and payment date for any payment
to Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07, or a suit by Holders of more than 10%
in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
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Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(ii)in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions required to be furnished to the Trustee hereunder and
conforming to the requirements of this Indenture. However, the Trustee
shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of any mathematical calculations
or other facts stated therein).
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(c) The Trustee may not be relieved from liabilities for its own
gross negligent action, its own gross negligent failure to act, or its own
willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii)the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts;
and
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01. (e) No provision of this Indenture shall
require the Trustee to expend or risk its own funds or incur any liability. The
Trustee shall be under no obligation to exercise any of its rights and powers
under this Indenture at the request of any Holders, unless such Holder shall
have offered to the Trustee security and indemnity satisfactory to it against
any loss, liability, claim, damage or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuers.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(g) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture or other paper or documents.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely upon any document (whether in
its original or facsimile form) believed by it to be genuine and to have been
signed or presented by the proper Person. The Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its own selection and the written advice or opinion of such counsel
or any Opinion of Counsel shall be full and
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complete authorization and protection from liability in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from either of the Issuers shall be
sufficient if signed by an Officer of such Issuer.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it against the costs, expenses
and liabilities that might be incurred by it in compliance with such request or
direction.
(g) The Trustee shall not be charged with knowledge of any Default
or Event of Default unless either (i) a Responsible Officer of the Trustee shall
have actual knowledge of such Default or Event of Default or (ii) written notice
of such Default or Event of Default shall have been given to and received by a
Responsible Officer of the Trustee by the Issuers or any Holder.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuers or any
Affiliate of the Issuers with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Sections 7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuers' use of the proceeds from the Notes or any money
paid to the Issuers or upon the Issuers' direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the
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Notes or any other document in connection with the sale of the Notes or
pursuant to this Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it
is known to a Responsible Officer of the Trustee, the Trustee shall mail to
Holders of Notes a notice of the Default or Event of Default within 90 days
after the Trustee acquires knowledge thereof. Except in the case of a Default or
Event of Default in payment of principal of, premium, if any, or interest on any
Note, the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders of the Notes.
Section 7.06. Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA ss. 313(a) (but if no event described in
TIA ss. 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss. 313(d). The
Issuers shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
Section 7.07. Compensation and Indemnity.
The Issuers shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuers shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Issuers shall, jointly and severally, indemnify the Trustee
against any and all losses, liabilities, claims, damages or expenses (including
reasonable legal fees and expenses) incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Issuers (including this Section 7.07) and defending itself against any claim
(whether asserted by the Issuers or any Holder or any other
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person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its gross negligence or willful misconduct. The
Trustee shall notify the Issuers promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Issuers shall not relieve the
Issuers of their obligations hereunder. The Issuers shall defend the claim and
the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Issuers shall pay the reasonable fees and expenses of such
counsel. The Issuers need not pay for any settlement made without their consent,
which consent shall not be unreasonably withheld.
The obligations of the Issuers this Section 7.07 shall survive
resignation or removal of the Trustee and the satisfaction and discharge of this
Indenture.
To secure the Issuers' payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the resignation or removal
of the Trustee and the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(g) or (h) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Issuers. The Holders of a majority
in principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Issuers in writing. The Issuers may remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
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(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuers shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Issuers.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuers, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition at the expense of the Company any court of competent jurisdiction
for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee; provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07. Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Issuers' obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee.
Section 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $100 million as set forth in its most recent published annual report of
condition.
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This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
Section 7.11. Preferential Collection of Claims Against the Issuers.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
----------------------------------------
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.
The Issuers may, at the option of their respective Boards of
Directors evidenced by a resolution set forth in an Officers' Certificate of
each of the Issuers, at any time, elect to have either Section 8.02 or 8.03 be
applied to all outstanding Notes upon compliance with the conditions set forth
below in this Article 8.
Section 8.02. Legal Defeasance and Discharge.
Upon the Issuers' exercise under Section 8.01 of the option
applicable to this Section 8.02, the Issuers shall, subject to the satisfaction
of the conditions set forth in Section 8.04, be deemed to have been discharged
from their obligations with respect to all outstanding Notes on the date the
conditions set forth below are satisfied (hereinafter, "Legal Defeasance"). For
this purpose, Legal Defeasance means that the Issuers shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Notes, which shall thereafter be deemed to be "outstanding" only for the
purposes of Section 8.05 and the other Sections of this Indenture referred to in
(a) and (b) below, and to have satisfied all their other obligations under such
Notes and this Indenture (and the Trustee, on demand of and at the expense of
the Issuers, shall execute proper instruments acknowledging the same), except
for the following provisions which shall survive until otherwise terminated or
discharged hereunder:
(a) the rights of Holders of outstanding Notes to receive payments
in respect of the principal of, premium, if any, and interest on such Notes when
such payments are due from the trust referred to below;
(b) the Issuers' obligations with respect to the Notes concerning
issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or
stolen Notes and the
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maintenance of an office or agency for payment and money for security payments
held in trust;
(c) the rights, powers, trusts, duties and immunities of the Trustee
and the Issuers' obligations in connection therewith; and
(d) the Legal Defeasance provisions of this Indenture;
Subject to compliance with this Article 8, the Issuers may exercise
their option under this Section 8.02 notwithstanding the prior exercise of their
option under Section 8.03.
Section 8.03. Covenant Defeasance.
Upon the Issuers' exercise under Section 8.01 of the option
applicable to this Section 8.03, the Issuers shall, subject to the satisfaction
of the conditions set forth in Section 8.04, be released from their obligations
under the covenants contained in Article 5 and Sections 4.03, 4.07, 4.08, 4.09,
4.10, 4.11, 4.12, 4.13, 4.14, 4.16, 4.17 and 4.19 with respect to the
outstanding Notes on and after the date the conditions set forth in Section 8.04
are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Issuers may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01, but, except as
specified above, the remainder of this Indenture and such Notes shall be
unaffected thereby. In addition, upon the Issuers' exercise under Section 8.01
of the option applicable to this Section 8.03, subject to the satisfaction of
the conditions set forth in Section 8.04, Sections 6.01(c) through 6.01(f) shall
not constitute Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
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(1) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on the
outstanding Notes on the stated maturity or on the applicable redemption date,
as the case may be, and the Company must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(2) in the case of Legal Defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel reasonably acceptable to the
Trustee confirming that (a) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (b) since the Issue Date,
there has been a change in the applicable federal income tax law, in either case
to the effect that, and based thereon such opinion of counsel shall confirm
that, the Holders of the outstanding Notes will not recognize income, gain or
loss for federal income tax purposes as a result of such Legal Defeasance and
will be subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Legal Defeasance had
not occurred;
(3) in the case of Covenant Defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel reasonably acceptable to the
Trustee confirming that the Holders of the outstanding Notes will not recognize
income, gain or loss for federal income tax purposes as a result of such
Covenant Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if
such Covenant Defeasance had not occurred;
(4) no Default or Event of Default shall have occurred and be
continuing either: (a) on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied to such
deposit); or (b) or insofar as Events of Default from bankruptcy or insolvency
events are concerned, at any time in the period ending on the 91st day after the
date of deposit;
(5) such Legal Defeasance or Covenant Defeasance will not result in
a breach or violation of, or constitute a default under any material agreement
or instrument (other than this Indenture) to which the Company or any of its
Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;
(6) the Company must have delivered to the Trustee an opinion of
counsel to the effect that after the 91st day assuming no intervening
bankruptcy, that no Holder is an insider of either of the Issuers following the
deposit and that such deposit would not be deemed by a court of competent
jurisdiction a transfer for the benefit of either Issuer in its capacity as
such, the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally;
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(7) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes over the other creditors of the Company with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others; and
(8) the Company must deliver to the Trustee an Officers' Certificate
and an opinion of counsel, each stating that all conditions precedent relating
to the Legal Defeasance or the Covenant Defeasance have been complied with.
Notwithstanding the foregoing, the opinion of counsel required by
clause (2) above with respect to a Legal Defeasance need not be delivered if all
Notes not theretofore delivered to the Trustee for cancellation (i) have become
due and payable or (ii) will become due and payable on the maturity date within
one year, by their terms or under arrangements satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the name, and at the
expense, of the Issuers.
Section 8.05. Deposited Money and Government Securities to Be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 in respect of the outstanding Notes shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Issuers acting as Paying Agent) as the Trustee may
determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal, premium, if any, and interest, but such money
need not be segregated from other funds except to the extent required by law.
The Issuers shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuers from time to time upon the request
of the Issuers any money or non-callable Government Securities held by it as
provided in Section 8.04 which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a)), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
85
Section 8.06. Repayment to Issuers.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Issuers, in trust for the payment of the principal of, premium, if
any, or interest on any Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to the Issuers on their request or (if then held by the Issuers) shall be
discharged from such trust; and the Holder of such Note shall thereafter look
only to the Issuers for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Issuers as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Issuers cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining shall be repaid to the Issuers.
Section 8.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers' obligations under this Indenture and the Notes,
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 until such time as the Trustee or Paying Agent is permitted
to apply all such money in accordance with Section 8.02 or 8.03, as the case may
be; provided, however, that, if the Issuers make any payment of principal of,
premium, if any, or interest on any Note following the reinstatement of their
obligations, the Issuers shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
--------------------------------
Section 9.01. Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Issuers and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
86
(b) to provide for uncertificated Notes in addition to or in place
of certificated Notes;
(c) to provide for or confirm the issuance of Additional Notes;
(d) to provide for the assumption of either Issuer's obligations to
Holders of Notes in the case of a merger or consolidation or sale of all or
substantially all of the assets of such Issuer pursuant to Article 5;
(e) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under this Indenture of any Holder; or
(f) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA or otherwise as
necessary to comply with applicable law.
Upon the request of the Issuers accompanied by a resolution of their
respective Boards of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02, the Trustee shall join with the Issuers in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes.
Except as provided below in this Section 9.02, this Indenture
(including Sections 4.11 and 4.16) or the Notes may be amended or supplemented
with the consent of the Holders of at least a majority in aggregate principal
amount of the Notes then outstanding (including, without limitation, consents
obtained in connection with a purchase of, or a tender offer or exchange offer
for, Notes) and, subject to Sections 6.04 and 6.07, any existing Default or
compliance with any provision of this Indenture or the Notes may be waived with
the consent of the Holders of a majority in aggregate principal amount of the
Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or a tender offer or exchange offer for, Notes).
Section 2.08 shall determine which Notes are considered to be "outstanding" for
purposes of this Section 9.02.
Upon the request of the Issuers accompanied by a resolution of their
respective Boards of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the
87
documents described in Section 7.02, the Trustee shall join with the Issuers in
the execution of such amended or supplemental Indenture unless such amended or
supplemental Indenture directly affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed amendment
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07, the Holders
of a majority in aggregate principal amount of the Notes then outstanding may
waive compliance in a particular instance by the Issuers with any provision of
this Indenture or the Notes. However, without the consent of each Holder
affected, an amendment, supplement or waiver under this Section 9.02 may not
(with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent
to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note
or alter the payment provisions with respect to the redemption of the Notes
(other than provisions relating to Sections 4.11 and 4.16);
(c) reduce the rate of or extend the time for payment of interest on
any Note;
(d) waive a Default or Event of Default in the payment of principal
of, or premium, if any, or interest on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the Notes and a waiver of the payment default that resulted
from such acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of, or premium, if any, or interest on the Notes;
(g) waive a redemption payment with respect to any Note (other than
a payment required by Sections 4.11 and 4.16); or
88
(h) make any change in this Section 9.02.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall
be set forth in a amended or supplemental Indenture that complies with the TIA
as then in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holder's Note, even if notation of the consent
is not made on any Note. However, any such Holder of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Issuers in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Issuers may not sign an amendment or supplemental Indenture until their
respective Boards of Directors approve it. In executing any amended or
supplemental indenture, the Trustee shall be entitled to receive and (subject to
Section 7.01) shall be fully protected in relying upon, in addition to the
documents required by Section 10.04, an Officer's Certificate and an Opinion of
Counsel, in each case from each of the Issuers, stating that the execution of
such amended or supplemental indenture is authorized or permitted by this
Indenture.
89
ARTICLE 10
MISCELLANEOUS
-------------
Section 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA ss. 318(c), the imposed duties shall control.
Section 10.02. Notices.
Any notice or communication by the Issuers or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Issuers:
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
Telecopier No.: (314) 965-8793
Attention: Secretary
With a copy to:
Paul, Hastings, Janofsky & Walker LLP Irell & Manella
399 Park Avenue 1800 Avenue of the Stars
31st Floor Suite 900
New York, New York 10022 Los Angeles, California 90067
Telecopier No.: (212) 319-4090 Telecopier No.: (310) 556-5393
Attention: Leigh P. Ryan, Esq. Attention: Meredith Jackson, Esq.
If to the Trustee:
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
90
The Issuers or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication shall also be so mailed to
any Person described in TIA ss. 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Issuers mail a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 10.03. Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA ss. 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Issuers, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss. 312(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuers to the Trustee to
take any action under this Indenture, the Issuers shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
91
Section 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 10.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. No Personal Liability of Directors, Officers, Employees, Members
and Stockholders.
No director, officer, employee, incorporator, member or stockholder
of the Issuers, as such, shall have any liability for any obligations of the
Issuers under the Notes, this Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
Section 10.08. Governing Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS INDENTURE AND THE NOTES AND ANY SUBSIDIARY GUARANTEE WITHOUT
GIVING EFFECT TO THE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT
THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE
COURTS
92
OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS INDENTURE OR THE NOTES OR ANY SUBSIDIARY GUARANTEE.
Section 10.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of the Issuers or their Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.
Section 10.10. Successors.
All agreements of the Issuers in this Indenture and the Notes, as
the case may be, shall bind their respective successors. All agreements of the
Trustee in this Indenture shall bind its successors.
Section 10.11. Severability.
In case any provision in this Indenture or the Notes, as the case
may be, shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 10.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
Section 10.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions.
ARTICLE 11
SATISFACTION AND DISCHARGE
--------------------------
Section 11.01. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to
any surviving rights of registration of transfer or exchange of Notes herein
expressly provided for), and the
93
Trustee, on demand of and at the expense of the Issuers, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered (other than
(i) Notes which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.07 and (ii) Notes for
whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Issuers and thereafter repaid to
the Issuers or discharged from such trust,) have been delivered to the
Trustee for cancellation; or
(B) all such Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Issuers,
and the Issuers, in the case of (i), (ii) or (iii) above, have
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Notes not theretofore delivered to the
Trustee for cancellation, for principal (and premium, if any) and
interest to the date of such deposit (in the case of Notes which have
become due and payable) or to the maturity or redemption thereof, as
the case may be;
(2) the Issuers have paid or caused to be paid all other sums
payable hereunder by the Issuers; and
(3) each of the Issuers have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture
pursuant to this Article 11, the obligations of the Issuers to the Trustee under
Section 7.07, and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 11.02 shall survive.
94
Section 11.02. Application of Trust Money.
All money deposited with the Trustee pursuant to Section 11.01 shall
be held in trust and applied by it, in accordance with the provisions of the
Notes and this Indenture, to the payment, either directly or through any Paying
Agent as the Trustee may determine, to the Persons entitled thereto, of the
principal (and premium, if any) and interest for whose payment such money has
been deposited with the Trustee.
[Signatures on following page]
95
SIGNATURES
Dated as of May 15, 2001
CHARTER COMMUNICATIONS HOLDINGS, LLC, as
an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
CHARTER COMMUNICATIONS HOLDINGS
CAPITAL CORPORATION, as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
BNY MIDWEST TRUST COMPANY, as Trustee
By: /s/ D.G. DONOVAN
---------------------------------
Name: D.G. Donovan
Title: Assistant Vice President
96
EXHIBIT A
[Face of Note]
CUSIP NO. [_______________]
10.000% Senior Notes due 2011
No.
$[----------------]
CHARTER COMMUNICATIONS HOLDINGS, LLC
and
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
promise to pay to
----------------------------------------------------------
or registered assigns,
the principal amount of Dollars
--------------------------------
($ ) on May 15, 2011.
---------------------------------
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
Subject to Restrictions set forth in this Note.
Dated: May 15, 2001.
CHARTER COMMUNICATIONS HOLDINGS, LLC
By
------------------------------------------------
Name:
Title:
By
------------------------------------------------
Name:
Title:
A-1
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
By
------------------------------------------------
Name:
Title:
By
------------------------------------------------
Name:
Title:
This is one of the Notes referred
to in the within-mentioned Indenture:
BNY MIDWEST TRUST COMPANY,
as Trustee
By:
------------------------------------------------
Authorized Signatory
A-2
[Back of Note]
10.000% Senior Notes due 2011
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE ISSUERS."1
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON WHO
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE
903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT SUBJECT TO THE CERTIFICATION AND DELIVERY
REQUIREMENTS OF THE INDENTURE GOVERNING THE NOTES, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (B) IN
- ---------
1 This paragraph should be included only if the Note is issued in global form.
A-3
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES."2
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Charter Communications Holdings, LLC, a Delaware
limited liability company (the "Company"), and Charter Communications Holdings
Capital Corporation, a Delaware corporation ("Charter Capital" and, together
with the Company, the "Issuers"), promise to pay interest on the principal
amount of this Note at the rate of 10.000% per annum from May 15, 2001 until
maturity. The interest rate on the Notes is subject to increase pursuant to the
provisions of the Registration Rights Agreement. The Issuers will pay interest
semi-annually in arrears on May 15 and November 15 of each year (each an
"Interest Payment Date"), or if any such day is not a Business Day, on the next
succeeding Business Day. Interest on the Notes will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face and the next succeeding Interest Payment Date, interest shall accrue
from such next succeeding Interest Payment Date; provided, further, that the
first Interest Payment Date shall be November 15, 2001. The Issuers shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate that is 1% per annum in excess of the rate then in effect; they
shall pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. METHOD OF PAYMENT. The Issuers shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the May 1 or November 1 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes will be payable as to
principal, premium, if any, and interest at the office or agency of the Issuers
maintained for such purpose within or without the City and State of New York,
or, at the option of the Issuers, payment of interest may be made by check
mailed to the Holders at their addresses set forth in the register of Holders,
and
- ---------
2 This paragraph should be removed upon the exchange of Notes for Exchange Notes
in an Exchange Offer or upon the registration of the Notes pursuant to the terms
of a Registration Rights Agreement.
provided that payment by wire transfer of immediately available funds will be
required with respect to principal of and interest and premium on all Global
Notes and all other Notes the Holders of which shall have provided wire transfer
instructions to the Issuers or the Paying Agent. Such payment shall be in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, BNY Midwest Trust Company,
the Trustee under the Indenture, will act as Paying Agent and Registrar. The
Issuers may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Issuers issued the Notes under an Indenture dated
as of May 15, 2001 (the "Indenture") between the Issuers and the Trustee. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939, as amended (15
U.S. Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Paragraph 5, the
Issuers shall not have the option to redeem the Notes prior to May 15, 2006.
Thereafter, the Issuers shall have the option to redeem the Notes, in whole or
in part, upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest thereon, if any, to the applicable redemption date,
if redeemed during the twelve-month period beginning on May 15 of the years
indicated below:
Year Percentage
---- ----------
2006 105.000%
2007 103.333%
2008 101.667%
2009 and thereafter 100.000%
(b) Notwithstanding the provisions of clause (a) of this Paragraph
5, at any time prior to May 15, 2004, the Issuers may on any one or more
occasions redeem up to 35% of the original aggregate principal amount of the
Notes (including the principal amount of any Additional Notes) issued under the
Indenture on a pro rata basis (or as nearly pro rata as practicable), at a
redemption price of 110.000% of the principal amount thereof, plus
A-5
accrued and unpaid interest to the redemption date, with the net cash proceeds
of one or more Equity Offerings; provided that
(1) at least 65% of the original aggregate principal amount of
Notes (including the principal amount of any Additional Notes) issued
under the Indenture remains outstanding immediately after the
occurrence of such redemption (excluding Notes held by the Company and
its Subsidiaries); and
(2) the redemption must occur within 60 days of the date of the
closing of such Equity Offering.
6. MANDATORY REDEMPTION.
Except as otherwise provided in Paragraph 7 below, the Issuers shall
not be required to make mandatory redemption payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Issuers shall make an offer
(a "Change of Control Offer") to repurchase all or any part (equal to $1,000 or
an integral multiple thereof) of each Holder's Notes at a purchase price equal
to 101% of the aggregate principal amount thereof plus accrued and unpaid
interest thereon, if any, to the date of purchase (the "Change of Control
Payment"). Within 10 days following any Change of Control, the Issuers shall
mail a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes on the Change
of Control Payment Date specified in such notice, pursuant to the procedures
required by the Indenture and described in such notice.
(b) If the Company or a Restricted Subsidiary consummates any Asset
Sale, when the aggregate amount of Excess Proceeds exceeds $25.0 million, the
Issuers shall commence an offer (an "Asset Sale Offer") pursuant to Section 4.11
of the Indenture to all Holders of Notes and all holders of other Indebtedness
that is pari passu with the Notes containing provisions requiring offers to
purchase or redeem with the proceeds of sales of assets to purchase the maximum
principal amount of Notes and such other pari passu Indebtedness that may be
purchased out of the Excess Proceeds (which amount includes the entire amount of
the Net Proceeds). The offer price in any Asset Sale Offer will be payable in
cash and equal to 100% of principal amount plus accrued and unpaid interest, if
any, to the date of purchase. If any Excess Proceeds remain after consummation
of an Asset Sale Offer, the Company may use such Excess Proceeds for any purpose
not otherwise prohibited by the Indenture. If the aggregate principal amount of
Notes and such other pari passu Indebtedness tendered into such Asset Sale Offer
exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and
such other pari passu Indebtedness to be purchased on a pro rata basis. Upon
completion of each
A-6
Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero. Holders
of Notes that are the subject of an offer to purchase will receive an Asset Sale
Offer from the Company prior to any related purchase date and may elect to have
such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed by
first class mail at least 30 days but not more than 60 days before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address. Notices of redemption may not be conditional. No Notes of $1,000 or
less may be redeemed in part. Notes in denominations larger than $1,000 may be
redeemed in part but only in whole multiples of $1,000, unless all of the Notes
held by a Holder are to be redeemed. On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and the Issuers may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Issuers need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Issuers
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in aggregate principal amount of the Notes
then outstanding (including, without limitation, consents obtained in connection
with a purchase of, or tender offer or exchange offer for, Notes), and any
existing default or compliance with any provision of the Indenture or the Notes
may be waived with the consent of the Holders of a majority in aggregate
principal amount of the Notes then outstanding (including, without limitation,
consents obtained in connection with a purchase of, or tender offer or exchange
offer for, Notes). Without the consent of any Holder of a Note, the Issuers and
the Trustee may amend or supplement the Indenture or the Notes to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Notes in
addition to or in place of certificated Notes, to provide for the assumption of
an Issuers' obligations to Holders of Notes in the case of a merger or
consolidation or sale of
A-7
all or substantially all of the assets of either Issuer to make any change that
would provide any additional rights or benefits to the Holders of Notes or that
does not adversely affect the legal rights under the Indenture of any such
Holder, or to comply with the requirements of the SEC in order to effect or
maintain the qualification of the Indenture under the TIA or otherwise as
necessary to comply with applicable law.
12. DEFAULTS AND REMEDIES. Each of the following is an Event of
Default: (i) default for 30 days in the payment when due of interest on the
Notes, (ii) default in payment when due of the principal of or premium, if any,
on the Notes, (iii) failure by the Company or any of its Restricted Subsidiaries
to comply with Sections 4.16 and 5.01 of the Indenture, (iv) failure by the
Company or any of its Restricted Subsidiaries for 30 days after written notice
thereof has been given to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% of the principal amount of the Notes
outstanding to comply with any of their other covenants or agreements in the
Indenture, (v) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries), whether such Indebtedness or guarantee now exists or
is created after the date of the Indenture, if that default: (a) is caused by a
failure to pay at final stated maturity the principal amount of such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (b) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more, (vi) failure by the Company or any of its Restricted
Subsidiaries to pay final judgments which are non-appealable aggregating in
excess of $100 million (net of applicable insurance which has not been denied in
writing by the insurer), which judgments are not paid, discharged or stayed for
a period of 60 days or (vii) certain events of bankruptcy or insolvency with
respect to the Company or any of its Significant Subsidiaries. In the case of an
Event of Default arising from certain events of bankruptcy or insolvency with
respect to the Company, all outstanding Notes will become due and payable
without further action or notice. If any other Event of Default occurs and is
continuing, the Trustee by notice to the Issuers or the Holders of at least 25%
in principal amount of the then outstanding Notes by notice to the Issuers and
the Trustee may declare all the Notes to be due and payable. Holders may not
enforce the Indenture or the Notes except as provided in the Indenture. Subject
to certain limitations, Holders of a majority in aggregate principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in aggregate
principal amount of the
A-8
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of interest on, or the principal of, the Notes. The Company is
required to deliver to the Trustee annually a statement regarding compliance
with the Indenture. Upon becoming aware of any Default or Event of Default, the
Company is required to deliver to the Trustee a statement specifying such
Default or Event of Default.
13. TRUSTEE DEALINGS WITH ISSUERS. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Issuers or their Affiliates, and may otherwise deal with the
Issuers or their Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator, member or stockholder of either of the Issuers, as such, shall not
have any liability for any obligations of the Issuers under the Notes or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
15. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS NOTE AND THE INDENTURE WITHOUT GIVING EFFECT
TO THE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. EACH
OF THE PARTIES HERETO AND THE HOLDERS AGREE TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE.
16. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
17. ABBREVIATIONS. Customary abbreviations may be used in the name
of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
18. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in any Registration Rights
Agreement.
A-9
19. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Issuers have caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive
Suite 100
St. Louis, Missouri 63131
Attention: Secretary
Telecopier No.: (314) 965-0555
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
--------------------------
(Insert assignee's legal name)
-----------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
-----------------------------------------------------------------------
-----------------------------------------------------------------------
-----------------------------------------------------------------------
-----------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint to
----------------------------------------------
transfer this Note on the books of the Issuers. The agent may substitute another
to act for him.
Date:
-----------------------
Your Signature:
--------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:
---------------------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuers
pursuant to Section 4.11 or 4.16 of the Indenture, check the appropriate box
below:
/_/ Section 4.11 /_/ Section 4.16
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.11 or Section 4.16 of the Indenture, state the
amount you elect to have purchased:
$
--------------------------
Date:
----------------------
Your Signature:
---------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:
------------------------------------------------
Signature Guarantee*:
--------------------------------------------------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-12
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Amount of Principal
decrease in Amount of Amount of this
Principal increase in Global Note
Amount of Principal following such Signature of authorized
Date of this Global Amount of this decrease (or officer of Trustee or
Exchange Note Global Note increase) Note Custodian
-------- ---- ----------- --------- --------------
A-13
Exhibit B
FORM OF CERTIFICATE OF TRANSFER
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 10.000% Senior Notes due 2011
Reference is hereby made to the Indenture, dated as of May 15, 2001
(the "Indenture"), among Charter Communications Holdings, LLC (the "Company")
and Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
___________________ (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $ _____________________________ in such Note[s] or interests
(the "Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. /_/ Check if Transferee will take delivery of a beneficial
interest in the Rule 144A Global Note or a Definitive Note Pursuant to Rule
144A. The Transfer is being effected pursuant to and in accordance with Rule
144A under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
beneficial interest or Definitive Note is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Note for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A, in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any state of the United States. Upon consummation of the proposed Transfer in
accordance with the terms of the Indenture,
B-1
the transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Rule 144A Global Note and/or the Definitive Note and in the Indenture and
the Securities Act.
2. /_/ Check if Transferee will take delivery of a beneficial
interest in the Regulation S Global Note or a Definitive Note pursuant to
Regulation S. The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act and (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note and/or the Definitive
Note and in the Indenture and the Securities Act. If the Transfer of the
beneficial interest occurs prior to the expiration of the 40-day distribution
compliance period set forth in Regulation S, the transferred beneficial interest
will be held immediately thereafter through Euroclear or Clearstream.
3. /_/ Check and complete if Transferee will take delivery of a
beneficial interest in a Definitive Note pursuant to any provision of the
Securities Act other than Rule 144A or Regulation S. The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial
interests in Restricted Global Notes and Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act and any applicable blue
sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) /_/ such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act; or
(b) /_/ such Transfer is being effected to the Company or a
subsidiary thereof; or
(c) /_/ such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act; or
B-2
(d) /_/ such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904,
and the Transferor hereby further certifies that it has not engaged in any
general solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive Notes
and the requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit D to the
Indenture and (2) an Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to this certification),
to the effect that such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Note and/or the Definitive Notes and in
the Indenture and the Securities Act.
4./_/Check if Transferee will take delivery of a beneficial interest
in an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) /_/ Check if Transfer is pursuant to Rule 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(b) /_/ Check if Transfer is Pursuant to Regulation S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) /_/ Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration
B-3
requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and
in compliance with the transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any State of the United States and (ii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will not be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Issuers.
- -----------------------------------------------
[Insert Name of Transferor]
By
--------------------------------------------
Name:
Title:
Dated:
-----------------------------------------
B-5
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) /_/ a beneficial interest in the:
(i) /_/ Rule 144A Global Note (CUSIP __________), or
(ii) /_/ Regulation S Global Note (CUSIP _________), or
(a) /_/ a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) /_/ a beneficial interest in the:
(i) /_/ Rule 144A Global Note (CUSIP __________), or
(ii) /_/ Regulation S Global Note (CUSIP _________), or
(iii) /_/ Unrestricted Global Note (CUSIP _________); or
(b) /_/ a Restricted Definitive Note; or
(c) /_/ an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-5
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 10.000% Senior Notes due 2011
(CUSIP )
-------------------
Reference is hereby made to the Indenture, dated as of May 15, 2001
(the "Indenture"), among Charter Communications Holdings, LLC (the "Company")
and Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
(the "Owner") owns and proposes to
-------------------------------
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $ in such Note[s] or interests
----------------------------
(the "Exchange"). In connection with the Exchange, the Owner hereby certifies
that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests
in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial
Interests in an Unrestricted Global Note
(a) /_/ Check if Exchange is from beneficial interest in a
Restricted Global Note to beneficial interest in an Unrestricted Global Note. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United States Securities
Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest in an Unrestricted
C-1
Global Note is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States. If the Exchange is from
beneficial interest in a Regulation S Global Note to beneficial interest in an
Unrestricted Global Note, the Owner further certifies that it is either (x) a
non-U.S. Person to whom Notes would be transferred in accordance with Regulation
S or (y) a U.S. person who purchased Notes in a transaction that did not require
registration under the Securities Act.
(b) /_/ Check if Exchange is from beneficial interest in a
Restricted Global Note to Unrestricted Definitive Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the Definitive Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(c) /_/ Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States. If the Exchange is from beneficial interest in a
Regulation S Global Note to an Unrestricted Definitive Note, the Owner further
certifies that it is either (x) a non-U.S. Person to whom Notes could be
transferred in accordance with Regulation S or (y) a U.S. Person who purchased
Notes in a transaction that did not require registration under the Securities
Act.
(d) /_/ Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
C-2
2. Exchange of Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes for Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes
(a) /_/ Check if Exchange is from beneficial interest in a
Restricted Global Note to Restricted Definitive Note. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. If the Exchange is from beneficial interest in a
Regulation S Global Note to a Restricted Definitive Note, the Owner further
certifies that it is either (x) a non-U.S. Person to whom Notes could be
transferred in accordance with Regulation S or (y) a U.S. Person who purchased
Notes in a transaction that did not require registration under the Securities
Act. Upon consummation of the proposed Exchange in accordance with the terms of
the Indenture, the Restricted Definitive Note issued will continue to be subject
to the restrictions on transfer enumerated in the Private Placement Legend
printed on the Restricted Definitive Note and in the Indenture and the
Securities Act.
(b) Check if Exchange is from Restricted Definitive Note to
beneficial interest in a Restricted Global Note. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] /_/ Rule 144A Global Note or /_/ Regulation S Global Note with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Issuers.
C-3
- -----------------------------------------------
[Insert Name of Transferor]
By -------------------------------------------
Name:
Title:
Dated:
-----------------------------------------
C-4
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 10.000% Senior Notes due 2011
Reference is hereby made to the Indenture, dated as of May 15, 2001
(the "Indenture"), among Charter Communications Holdings, LLC (the "Company")
and Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) /_/ a beneficial interest in a Global Note, or
(b) /_/ a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any
D-1
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and an Opinion
of Counsel in form reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Issuers such certifications, legal opinions and other information as you and the
Issuers may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
_______________You and the Issuers are entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a copy to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
D-2
-------------------------------------------
[Insert Name of Transferor]
By
----------------------------------------
Name:
Title:
Dated:
-----------------------------------------
D-3
EXECUTION COPY
=========================================================================
CHARTER COMMUNICATIONS HOLDINGS, LLC
and
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION,
as Issuers
and
BNY MIDWEST TRUST COMPANY,
as Trustee
INDENTURE
Dated as of May 15, 2001
10.000% Senior Notes due 2011
=========================================================================
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
310(a)(1).............................................. 7.10
(a)(2)................................................. 7.10
(a)(3)................................................. N.A.
(a)(4)................................................. N.A.
(a)(5)................................................. 7.10
(b).................................................... 7.10
(c).................................................... N.A.
311(a)................................................. 7.11
(b).................................................... 7.11
(c).................................................... N.A.
312(a)................................................. 2.05
(b).................................................... 10.03
(c).................................................... 10.03
313(a)................................................. 7.06
(b)(1)................................................. 10.03
(b)(2)................................................. 7.07; 10.03
(c).................................................... 7.06; 10.02
(d).................................................... 7.06
314(a)................................................. 4.03; 10.02
(b).................................................... 10.02
(c)(1)................................................. 10.04
(c)(2)................................................. 10.04
(c)(3)................................................. N.A.
(d).................................................... N.A.
(e).................................................... 10.05
(f).................................................... N.A.
315(a)................................................. 7.01
(b).................................................... 7.05; 10.02
(c).................................................... 7.01
(d).................................................... 7.01
(e).................................................... 6.11
316(a) (last sentence)................................. 2.09
(a)(1)(A).............................................. 6.05
(a)(1)(B).............................................. 6.04
(a)(2)................................................. N.A.
i
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
(b).................................................... 6.07
(c).................................................... 2.12
317(a)(1).............................................. 6.08
(a)(2)................................................. 6.09
(b).................................................... 2.04
318(a)................................................. 10.01
(b).................................................... N.A.
(c).................................................... 10.01
N.A. means Not Applicable.
* This Cross-Reference Table is not part of the Indenture.
ii
TABLE OF CONTENTS
Page
----
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE...........................1
Section 1.01. Definitions.......................................................1
Section 1.02. Other Definitions................................................25
Section 1.03. Incorporation by Reference of Trust Indenture Act................26
Section 1.04. Rules of Construction............................................26
ARTICLE 2 THE NOTES...........................................................27
Section 2.01. Form and Dating..................................................27
Section 2.02. Execution and Authentication.....................................28
Section 2.03. Registrar and Paying Agent.......................................29
Section 2.04. Paying Agent to Hold Money in Trust..............................29
Section 2.05. Holder Lists.....................................................30
Section 2.06. Transfer and Exchange............................................30
Section 2.07. Replacement Notes................................................43
Section 2.08. Outstanding Notes................................................44
Section 2.09. Treasury Notes...................................................44
Section 2.10. Temporary Notes..................................................45
Section 2.11. Cancellation.....................................................45
Section 2.12. Defaulted Interest...............................................45
ARTICLE 3 REDEMPTION AND PREPAYMENT...........................................46
Section 3.01. Notices to Trustee...............................................46
Section 3.02. Selection of Notes to Be Redeemed................................46
Section 3.03. Notice of Redemption.............................................46
Section 3.04. Effect of Notice of Redemption...................................47
Section 3.05. Deposit of Redemption Price......................................47
Section 3.06. Notes Redeemed in Part...........................................48
Section 3.07. Optional Redemption..............................................48
Section 3.08. Mandatory Redemption.............................................49
Section 3.09. Offer to Purchase by Application of Excess Proceeds..............49
ARTICLE 4 COVENANTS...........................................................51
Section 4.01. Payment of Notes.................................................51
Section 4.02. Maintenance of Office or Agency..................................51
Section 4.03. Reports..........................................................52
Section 4.04. Compliance Certificate...........................................53
Section 4.05. Taxes............................................................54
Section 4.06. Stay, Extension and Usury Laws...................................54
Section 4.07. Restricted Payments..............................................54
iii
Section 4.08. Investments......................................................57
Section 4.09. Dividend and Other Payment Restrictions Affecting Subsidiaries...58
Section 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock.......60
Section 4.11. Limitation on Asset Sales........................................63
Section 4.12. Sale and Leaseback Transactions..................................64
Section 4.13. Transactions with Affiliates.....................................65
Section 4.14. Liens............................................................66
Section 4.15. Existence........................................................66
Section 4.16. Repurchase at the Option of Holders upon a Change of Control.....66
Section 4.17. Limitations on Issuances of Guarantees of Indebtedness...........68
Section 4.18. Payments for Consent.............................................69
Section 4.19. Application of Fall-Away Covenants...............................69
ARTICLE 5 SUCCESSORS..........................................................69
Section 5.01. Merger, Consolidation, or Sale of Assets.........................69
Section 5.02. Successor Corporation Substituted................................70
ARTICLE 6 DEFAULTS AND REMEDIES...............................................71
Section 6.01. Events of Default................................................71
Section 6.02. Acceleration.....................................................72
Section 6.03. Other Remedies...................................................73
Section 6.04. Waiver of Existing Defaults......................................73
Section 6.05. Control by Majority..............................................73
Section 6.06. Limitation on Suits..............................................74
Section 6.07. Rights of Holders of Notes to Receive Payment....................74
Section 6.08. Collection Suit by Trustee.......................................74
Section 6.09. Trustee May File Proofs of Claim.................................75
Section 6.10. Priorities.......................................................75
Section 6.11. Undertaking for Costs............................................76
ARTICLE 7 TRUSTEE.............................................................76
Section 7.01. Duties of Trustee................................................76
Section 7.02. Rights of Trustee................................................77
Section 7.03. Individual Rights of Trustee.....................................78
Section 7.04. Trustee's Disclaimer.............................................78
Section 7.05. Notice of Defaults...............................................79
Section 7.06. Reports by Trustee to Holders of the Notes.......................79
Section 7.07. Compensation and Indemnity.......................................79
Section 7.08. Replacement of Trustee...........................................80
Section 7.09. Successor Trustee by Merger, etc.................................81
Section 7.10. Eligibility; Disqualification....................................81
iv
Section 7.11. Preferential Collection of Claims Against the Issuers............82
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE............................82
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.........82
Section 8.02. Legal Defeasance and Discharge...................................82
Section 8.03. Covenant Defeasance..............................................83
Section 8.04. Conditions to Legal or Covenant Defeasance.......................83
Section 8.05. Deposited Money and Government Securities to Be Held in Trust;
Other Miscellaneous Provisions...................................85
Section 8.06. Repayment to Issuers.............................................86
Section 8.07. Reinstatement....................................................86
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER....................................86
Section 9.01. Without Consent of Holders of Notes..............................86
Section 9.02. With Consent of Holders of Notes.................................87
Section 9.03. Compliance with Trust Indenture Act..............................89
Section 9.04. Revocation and Effect of Consents................................89
Section 9.05. Notation on or Exchange of Notes.................................89
Section 9.06. Trustee to Sign Amendments, etc..................................89
ARTICLE 10 MISCELLANEOUS.......................................................90
Section 10.01. Trust Indenture Act Controls.....................................90
Section 10.02. Notices..........................................................90
Section 10.03. Communication by Holders of Notes with Other Holders of Notes....91
Section 10.04. Certificate and Opinion as to Conditions Precedent...............91
Section 10.05. Statements Required in Certificate or Opinion....................92
Section 10.06. Rules by Trustee and Agents......................................92
Section 10.07. No Personal Liability of Directors, Officers, Employees, Members
and Stockholders.................................................92
Section 10.08. Governing Law....................................................92
Section 10.09. No Adverse Interpretation of Other Agreements....................93
Section 10.10. Successors.......................................................93
Section 10.11. Severability.....................................................93
Section 10.12. Counterpart Originals............................................93
Section 10.13. Table of Contents, Headings, etc.................................93
ARTICLE 11 SATISFACTION AND DISCHARGE..........................................93
Section 11.01. Satisfaction and Discharge of Indenture..........................93
Section 11.02. Application of Trust Money.......................................95
v
EXHIBIT A................................................................A-1
EXHIBIT B................................................................B-1
EXHIBIT C................................................................C-1
EXHIBIT D................................................................D-1
vi
EXECUTION COPY
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
$575,000,000 10.000% Senior Notes due 2011
Exchange and Registration Rights Agreement
------------------------------------------
May 15, 2001
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
JP Morgan, a Division of Chase Securities Inc.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns Corp.
Dresdner Kleinwort Wasserstein Securities LLC
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Charter Communications Holdings, LLC, a Delaware limited liability
company (the "Company"), and Charter Communications Holdings Capital
Corporation, a Delaware corporation ("Charter Capital" and, together with the
Company, the "Issuers"), propose, subject to the terms and conditions stated
herein, to issue and sell to the Purchasers (as defined herein) upon the terms
set forth in the Purchase Agreement (as defined herein) their $575,000,000
aggregate principal amount of 10.000% Senior Notes due 2011 (the "Notes"). As an
inducement to the Purchasers to enter into the Purchase Agreement and in
satisfaction of a condition to the obligations of the Purchasers thereunder, the
Issuers agree with the Purchasers for the benefit of holders (as defined herein)
from time to time of the Registrable Securities (as defined herein) as follows:
1. Certain Definitions. For purposes of this Exchange and Registration
Rights Agreement, the following terms shall have the following respective
meanings:
"Base Interest" shall mean the interest that would otherwise accrue on
the Notes under the terms thereof and the Indenture, without giving effect to
the provisions of this Exchange and Registration Rights Agreement.
The term "broker-dealer" shall mean any broker or dealer registered with
the Commission under the Exchange Act.
"Closing Date" shall mean the date on which the Notes are initially
issued.
"Commission" shall mean the United States Securities and Exchange
Commission, or any other federal agency at the time administering the Exchange
Act or the Securities Act, whichever is the relevant statute for the particular
purpose.
"Effective Time," in the case of (i) an Exchange Offer Registration,
shall mean the time and date as of which the Commission declares the Exchange
Offer Registration Statement effective or as of which the Exchange Offer
Registration Statement otherwise becomes effective and (ii) a Shelf
Registration, shall mean the time and date as of which the Commission declares
the Shelf Registration Statement effective or as of which the Shelf Registration
Statement otherwise becomes effective.
"Electing Holder" shall mean any holder of Registrable Securities that
has returned a completed and signed Notice and Questionnaire to the Issuers in
accordance with Section 3(d)(ii) or 3(d)(iii) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, or any
successor thereto, as the same shall be amended from time to time.
"Exchange Notes" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Exchange Offer" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Exchange Offer Registration" shall have the meaning assigned thereto in
Section 3(c) hereof.
"Exchange Offer Registration Statement" shall have the meaning assigned
thereto in Section 2(a) hereof.
The term "holder" shall mean each of the Purchasers and other persons
who acquire Registrable Securities from time to time (including any successors
or assigns), in each case for so long as such person is a registered holder of
any Registrable Securities.
2
"Indenture" shall mean the Indenture governing the Notes, dated as of
May 15, 2001 between the Issuers and BNY Midwest Trust Company, as Trustee, as
the same shall be amended from time to time.
"Notes" shall mean, collectively, the 10.000% Senior Notes due 2011 of
the Issuers to be issued and sold to the Purchasers, and Notes issued in
exchange therefor or in lieu thereof, pursuant to the Indenture.
"Notice and Questionnaire" means a Notice of Registration Statement and
Selling Securityholder Questionnaire substantially in the form of Exhibit A
hereto.
The term "person" shall mean a corporation, association, partnership,
organization, business, individual, government or political subdivision thereof
or governmental agency.
"Purchase Agreement" shall mean the Purchase Agreement, dated as of May
10, 2001, between the Purchasers and the Issuers relating to the Notes.
"Purchasers" shall mean the Purchasers named in Schedule I to the
Purchase Agreement.
"Registrable Securities" shall mean the Notes; provided, however, that a
Note shall cease to be a Registrable Security when (i) in the circumstances
contemplated by Section 2(a) hereof, such Note has been exchanged for an
Exchange Note in an Exchange Offer as contemplated in Section 2(a) hereof
(provided that any Exchange Note that, pursuant to the last two sentences of
Section 2(a), is included in a prospectus for use in connection with resales by
broker-dealers shall be deemed to be a Registrable Security with respect to
Sections 5, 6 and 9 hereof until resale of such Registrable Security has been
effected within the 180-day period referred to in Section 2(a)(y)); (ii) in the
circumstances contemplated by Section 2(b) hereof, a Shelf Registration
Statement registering such Note under the Securities Act has been declared or
becomes effective and such Note has been sold or otherwise transferred by the
holder thereof pursuant to and in a manner contemplated by such effective Shelf
Registration Statement; (iii) such Note is sold pursuant to Rule 144 under
circumstances in which any legend borne by such Note relating to restrictions on
transferability thereof, under the Securities Act or otherwise, is removed by
the Issuers or pursuant to the Indenture; (iv) such Security is eligible to be
sold pursuant to paragraph (k) of Rule 144; or (v) such Security shall cease to
be outstanding.
"Registration Default" shall have the meaning assigned thereto in
Section 2(c) hereof.
"Registration Expenses" shall have the meaning assigned thereto in
Section 4 hereof.
3
"Resale Period" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Restricted Holder" shall mean (i) a holder that is an affiliate of the
Issuers within the meaning of Rule 405, (ii) a holder who acquires Exchange
Notes outside the ordinary course of such holder's business, (iii) a holder who
has arrangements or understandings with any person to participate in the
Exchange Offer for the purpose of distributing Exchange Notes and (iv) a holder
that is a broker-dealer, but only with respect to Exchange Notes received by
such broker-dealer pursuant to an Exchange Offer in exchange for Registrable
Securities acquired by the broker-dealer directly from the Issuers.
"Rule 144," "Rule 405" and "Rule 415" shall mean, in each case, such
rule promulgated under the Securities Act (or any successor provision), as the
same shall be amended from time to time.
"Securities Act" shall mean the Securities Act of 1933, or any successor
thereto, as the same shall be amended from time to time.
"Shelf Registration" shall have the meaning assigned thereto in Section
2(b) hereof.
"Shelf Registration Statement" shall have the meaning assigned thereto
in Section 2(b) hereof.
"Special Interest" shall have the meaning assigned thereto in Section
2(c) hereof.
"subsidiaries" shall mean subsidiaries which would be "significant
subsidiaries" as defined in Rule 1-02(w) of Regulation S-X under the Exchange
Act.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, or any
successor thereto, and the rules, regulations and forms promulgated thereunder,
all as the same shall be amended from time to time.
Unless the context otherwise requires, any reference herein to a
"Section" or "clause" refers to a Section or clause, as the case may be, of this
Exchange and Registration Rights Agreement, and the words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Exchange and
Registration Rights Agreement as a whole and not to any particular Section or
other subdivision.
2. Registration Under the Securities Act.
(a) Except as set forth in Section 2(b) below, the Issuers agree to
file under the Securities Act, as soon as practicable, but no later than 120
days after the Closing Date, a registration statement relating to an offer to
exchange (such registration
4
statement, the "Exchange Offer Registration Statement", and such offer, the
"Exchange Offer") any and all of the Notes for a like aggregate principal amount
of notes issued by the Issuers, which notes are substantially identical in all
material respects to the Notes (and are entitled to the benefits of a trust
indenture which has terms identical in all material respects to the Indenture or
is the Indenture and which has been qualified under the Trust Indenture Act),
except that they have been registered pursuant to an effective registration
statement under the Securities Act and do not contain provisions for the
additional interest contemplated in Section 2(c) below (such notes hereinafter
called "Exchange Notes"). The Issuers agree to use their reasonable best efforts
to cause the Exchange Offer Registration Statement to become or be declared
effective under the Securities Act as soon as practicable, but no later than 180
days after the Closing Date. The Exchange Offer will be registered under the
Securities Act on the appropriate form and will comply with all applicable
tender offer rules and regulations under the Exchange Act. The Issuers further
agree to use their reasonable best efforts to complete the Exchange Offer
promptly, but no later than 30 business days or longer, if required by the
federal securities laws, after such registration statement has become effective,
hold the Exchange Offer open for at least 30 days and exchange Exchange Notes
for all Registrable Securities that have been properly tendered and not
withdrawn on or prior to the expiration of the Exchange Offer. The Exchange
Offer will be deemed to have been "completed" only if the Exchange Notes
received by holders, other than Restricted Holders, in the Exchange Offer in
exchange for Registrable Securities are, upon receipt, transferable by each such
holder without restriction under the Securities Act and the Exchange Act and
without material restrictions under the blue sky or securities laws of a
substantial majority of the States of the United States of America. The Exchange
Offer shall be deemed to have been completed upon the earlier to occur of (i)
the Issuers having exchanged the Exchange Notes for all outstanding Registrable
Securities pursuant to the Exchange Offer and (ii) the Issuers having exchanged,
pursuant to the Exchange Offer, Exchange Notes for all Registrable Securities
that have been properly tendered and not withdrawn before the expiration of the
Exchange Offer, which shall be on a date that is at least 30 business days
following the commencement of the Exchange Offer. The Issuers agree (x) to
include in the Exchange Offer Registration Statement a prospectus for use in any
resales by any holder of Exchange Notes that is a broker-dealer and (y) to keep
such Exchange Offer Registration Statement effective for a period (the "Resale
Period") beginning when Exchange Notes are first issued in the Exchange Offer
and ending upon the earlier of the expiration of the 180th day after the
Exchange Offer has been completed or such time as such broker-dealers no longer
own any Registrable Securities. With respect to such Exchange Offer Registration
Statement, such holders shall have the benefit of the rights of indemnification
and contribution set forth in Sections 6(a), (c), (d) and (e) hereof.
(b) If (i) on or prior to the time the Exchange Offer is completed
existing law or Commission policy or interpretations are changed such that the
Exchange Notes received by holders, other than Restricted Holders, in the
Exchange Offer in
5
exchange for Registrable Securities are not or would not be, upon receipt,
transferable by each such holder without restriction under the Securities Act,
(ii) the Exchange Offer has not been completed within 210 days following the
Closing Date or (iii) the Exchange Offer is not available to any holder of the
Notes, the Issuers shall, in lieu of (or, in the case of clause (iii), in
addition to) conducting the Exchange Offer contemplated by Section 2(a), file
under the Securities Act on or prior to 30 business days after the time such
obligation to file arises, a "shelf" registration statement providing for the
registration of, and the sale on a continuous or delayed basis by the holders
of, all of the Registrable Securities, pursuant to Rule 415 or any similar rule
that may be adopted by the Commission (such filing, the "Shelf Registration" and
such registration statement, the "Shelf Registration Statement"). The Issuers
agree to use their reasonable best efforts (x) to cause the Shelf Registration
Statement to become or be declared effective by the Commission no later than 90
days after such obligation to file arises and to keep such Shelf Registration
Statement continuously effective for a period ending on the earlier of (i) the
second anniversary of the Effective Time or (ii) such time as there are no
longer any Registrable Securities outstanding; provided, however, that no holder
shall be entitled to be named as a selling securityholder in the Shelf
Registration Statement or to use the prospectus forming a part thereof for
resales of Registrable Securities unless such holder is an Electing Holder, and
(y) after the Effective Time of the Shelf Registration Statement, promptly upon
the request of any holder of Registrable Securities that is not then an Electing
Holder, to take any action reasonably necessary to enable such holder to use the
prospectus forming a part thereof for resales of Registrable Securities,
including, without limitation, any action necessary to identify such holder as a
selling securityholder in the Shelf Registration Statement, provided, however,
that nothing in this clause (y) shall relieve any such holder of the obligation
to return a completed and signed Notice and Questionnaire to the Issuers in
accordance with Section 3(d)(iii) hereof. The Issuers further agree to
supplement or make amendments to the Shelf Registration Statement, as and when
required by the rules, regulations or instructions applicable to the
registration form used by the Issuers for such Shelf Registration Statement or
by the Securities Act or rules and regulations thereunder for shelf
registration, and the Issuers agree to furnish to each Electing Holder copies of
any such supplement or amendment prior to its being used or promptly following
its filing with the Commission.
(c) In the event that (i) the Issuers have not filed the Exchange
Offer Registration Statement or Shelf Registration Statement on or before the
date on which such registration statement is required to be filed pursuant to
Section 2(a) or 2(b), respectively, or (ii) such Exchange Offer Registration
Statement or Shelf Registration Statement has not become effective or been
declared effective by the Commission on or before the date on which such
registration statement is required to become or be declared effective pursuant
to Section 2(a) or 2(b), respectively, or (iii) the Exchange Offer has not been
completed within 30 business days after the initial effective date of the
Exchange Offer Registration Statement relating to the Exchange Offer (if the
Exchange Offer is then required to be made) or (iv) any Exchange Offer
Registration Statement or Shelf
6
Registration Statement required by Section 2(a) or 2(b) hereof is filed and
becomes or is declared effective but shall thereafter either be withdrawn by the
Issuers or shall become subject to an effective stop order issued pursuant to
Section 8(d) of the Securities Act suspending the effectiveness of such
registration statement (except as specifically permitted herein) without being
succeeded immediately by an additional registration statement filed and declared
effective (each such event referred to in clauses (i) through (iv), a
"Registration Default" and each period during which a Registration Default has
occurred and is continuing, a "Registration Default Period"), then, as
liquidated damages for such Registration Default, subject to the provisions of
Section 9(b), special interest ("Special Interest"), in addition to the Base
Interest, shall accrue on the aggregate principal amount of the outstanding
Notes at a per annum rate of 0.25% for the first 90 days of the Registration
Default Period, at a per annum rate of 0.50% for the second 90 days of the
Registration Default Period, at a per annum rate of 0.75% for the third 90 days
of the Registration Default Period and at a per annum rate of 1.0% thereafter
for the remaining portion of the Registration Default Period. All accrued
Special Interest shall be paid in cash by the Issuers on each Interest Payment
Date (as defined in the Indenture). Notwithstanding the foregoing and anything
in this Agreement to the contrary, in the case of an event referred to in clause
(ii) above, a "Registration Default" shall be deemed not to have occurred so
long as the Issuers, in their sole reasonable judgment, are using and continuing
to use their reasonable best efforts to cause such Exchange Offer Registration
Statement or Shelf Registration Statement, as the case may be, to become or be
declared effective.
(d) The Issuers shall use their reasonable best efforts to take all
actions necessary or advisable to be taken by them to ensure that the
transactions contemplated herein are effected as so contemplated in Section 2(a)
or 2(b) hereof.
(e) Any reference herein to a registration statement as of any time
shall be deemed to include any document incorporated, or deemed to be
incorporated, therein by reference as of such time and any reference herein to
any post-effective amendment to a registration statement as of any time shall be
deemed to include any document incorporated, or deemed to be incorporated,
therein by reference as of such time.
3. Registration Procedures.
If the Issuers file a registration statement pursuant to Section 2(a)
or Section 2(b), the following provisions shall apply:
(a) At or before the Effective Time of the Exchange Offer or the Shelf
Registration, as the case may be, the Issuers shall cause the Indenture to be
qualified under the Trust Indenture Act of 1939.
7
(b) In the event that such qualification would require the appointment
of a new trustee under the Indenture, the Issuers shall appoint a new trustee
thereunder pursuant to the applicable provisions of the Indenture.
(c) In connection with the Issuers' obligations with respect to the
registration of Exchange Notes as contemplated by Section 2(a) (the "Exchange
Offer Registration"), if applicable, the Issuers shall, as soon as practicable
(or as otherwise specified):
(i) prepare and file with the Commission, as soon as
practicable but no later than 120 days after the Closing Date, an
Exchange Offer Registration Statement on any form which may be
utilized by the Issuers and which shall permit the Exchange Offer
and resales of Exchange Notes by broker-dealers during the Resale
Period to be effected as contemplated by Section 2(a), and use
their reasonable best efforts to cause such Exchange Offer
Registration Statement to become or be declared effective as soon
as practicable thereafter, but no later than 180 days after the
Closing Date;
(ii) as soon as practicable prepare and file with the
Commission such amendments and supplements to such Exchange Offer
Registration Statement and the prospectus included therein as may
be necessary to effect and maintain the effectiveness of such
Exchange Offer Registration Statement for the periods and purposes
contemplated in Section 2(a) hereof and as may be required by the
applicable rules and regulations of the Commission and the
instructions applicable to the form of such Exchange Offer
Registration Statement, and promptly provide each broker-dealer
holding Exchange Notes with such number of copies of the prospectus
included therein (as then amended or supplemented), in conformity
in all material respects with the requirements of the Securities
Act and the Trust Indenture Act and the rules and regulations of
the Commission thereunder, as such broker-dealer reasonably may
request prior to the expiration of the Resale Period, for use in
connection with resales of Exchange Notes;
(iii) promptly notify each broker-dealer that has requested or
received copies of the prospectus included in such registration
statement, and confirm such advice in writing, (A) when such
Exchange Offer Registration Statement or the prospectus included
therein or any prospectus amendment or supplement or post-effective
amendment has been filed, and, with respect to such Exchange Offer
Registration Statement or any post-effective amendment, when the
same has become effective, (B) of any comments by the Commission
and by the blue sky or securities commissioner or regulator of any
state with respect thereto, or
8
any request by the Commission for amendments or supplements to such
Exchange Offer Registration Statement or prospectus or for
additional information, (C) of the issuance by the Commission of
any stop order suspending the effectiveness of such Exchange Offer
Registration Statement or the initiation or, to the knowledge of
the Issuers, threatening of any proceedings for that purpose, (D)
if at any time the representations and warranties of the Issuers
contemplated by Section 5 hereof cease to be true and correct in
all material respects, (E) of the receipt by the Issuers of any
notification with respect to the suspension of the qualification of
the Exchange Notes for sale in any jurisdiction or the initiation
or, to the knowledge of the Issuers, threatening of any proceeding
for such purpose, or (F) at any time during the Resale Period when
a prospectus is required to be delivered under the Securities Act,
that such Exchange Offer Registration Statement, prospectus,
prospectus amendment or supplement or post-effective amendment does
not conform in all material respects to the applicable requirements
of the Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission thereunder, or contains an untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing;
(iv) in the event that the Issuers would be required, pursuant
to Section 3(e)(iii)(F) above, to notify any broker-dealers holding
Exchange Notes, the Issuers shall prepare and furnish to each such
holder a reasonable number of copies of a prospectus supplemented
or amended so that, as thereafter delivered to purchasers of such
Exchange Notes during the Resale Period, such prospectus conforms
in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission thereunder and shall not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances
then existing;
(v) use their reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of such Exchange Offer
Registration Statement or any post-effective amendment thereto as
soon as practicable;
(vi) use their reasonable best efforts to (A) register or
qualify the Exchange Notes under the securities laws or blue sky
laws of such jurisdictions as are contemplated by Section 2(a) no
later than the commencement of the Exchange Offer, (B) keep such
registrations or
9
qualifications in effect and comply with such laws so as to permit
the continuance of offers, sales and dealings therein in such
jurisdictions until the expiration of the Resale Period and (C)
take any and all other actions as may be reasonably necessary or
advisable to enable each broker-dealer holding Exchange Notes to
consummate the disposition thereof in such jurisdictions; provided,
however, that neither of the Issuers shall be required for any such
purpose to (1) qualify as a foreign corporation or limited
liability company, as the case may be, in any jurisdiction wherein
it would not otherwise be required to qualify but for the
requirements of this Section 3(c)(vi), (2) consent to general
service of process in any such jurisdiction or (3) make any changes
to its certificate of incorporation or by-laws (or other
organizational document) or any agreement between it and holders of
its ownership interests;
(vii) use their reasonable best efforts to obtain the consent
or approval of each governmental agency or authority, whether
federal, state or local, which may be required to effect the
Exchange Offer Registration, the Exchange Offer and the offering
and sale of Exchange Notes by broker-dealers during the Resale
Period;
(viii) provide a CUSIP number for all Exchange Notes, not later
than the applicable Effective Time;
(ix) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as
soon as practicable but no later than eighteen months after the
effective date of such Exchange Offer Registration Statement, an
earning statement of the Company and its subsidiaries complying
with Section 11(a) of the Securities Act (including, at the option
of the Company, Rule 158 thereunder).
(d) In connection with the Issuers' obligations with respect to the
Shelf Registration, if applicable, the Issuers shall, as soon as practicable (or
as otherwise specified):
(i) prepare and file with the Commission within the time
periods specified in Section 2(b), a Shelf Registration Statement
on any form which may be utilized by the Issuers and which shall
register all of the Registrable Securities for resale by the
holders thereof in accordance with such method or methods of
disposition as may be specified by such of the holders as, from
time to time, may be Electing Holders and use their reasonable best
efforts to cause such Shelf Registration Statement to
10
become or be declared effective within the time periods specified
in Section 2(b);
(ii) not less than 30 calendar days prior to the Effective Time
of the Shelf Registration Statement, mail the Notice and
Questionnaire to the holders of Registrable Securities; no holder
shall be entitled to be named as a selling securityholder in the
Shelf Registration Statement as of the Effective Time, and no
holder shall be entitled to use the prospectus forming a part
thereof for resales of Registrable Securities at any time, unless
such holder has returned a completed and signed Notice and
Questionnaire to the Issuers by the deadline for response set forth
therein; provided, however, holders of Registrable Securities shall
have at least 28 calendar days from the date on which the Notice
and Questionnaire is first mailed to such holders to return a
completed and signed Notice and Questionnaire to the Issuers;
(iii) after the Effective Time of the Shelf Registration
Statement, upon the request of any holder of Registrable Securities
that is not then an Electing Holder, promptly send a Notice and
Questionnaire to such holder; provided that the Issuers shall not
be required to take any action to name such holder as a selling
securityholder in the Shelf Registration Statement or to enable
such holder to use the prospectus forming a part thereof for
resales of Registrable Securities until such holder has returned a
completed and signed Notice and Questionnaire to the Issuers;
(iv) as soon as practicable prepare and file with the
Commission such amendments and supplements to such Shelf
Registration Statement and the prospectus included therein as may
be necessary to effect and maintain the effectiveness of such Shelf
Registration Statement for the period specified in Section 2(b)
thereof and as may be required by the applicable rules and
regulations of the Commission and the instructions applicable to
the form of such Shelf Registration Statement, and furnish to the
Electing Holders copies of any such supplement or amendment
simultaneously with or prior to its being used or filed with the
Commission;
(v) comply with the provisions of the Securities Act with
respect to the disposition of all of the Registrable Securities
covered by such Shelf Registration Statement in accordance with the
intended methods of disposition by the Electing Holders provided
for in such Shelf Registration Statement;
11
(vi) provide (A) the Electing Holders, (B) the underwriters
(which term, for purposes of this Exchange and Registration Rights
Agreement, shall include a person deemed to be an underwriter
within the meaning of Section 2(a)(11) of the Securities Act), if
any, thereof, (C) any sales or placement agent therefor, (D)
counsel for any such underwriter or agent and (E) not more than one
counsel for all the Electing Holders the opportunity to participate
in the preparation of such Shelf Registration Statement, each
prospectus included therein or filed with the Commission and each
amendment or supplement thereto;
(vii) for a reasonable period prior to the filing of such Shelf
Registration Statement, and throughout the period specified in
Section 2(b), make available at reasonable times at the Issuers'
principal place of business or such other reasonable place for
inspection by the persons referred to in Section 3(d)(vi) who shall
certify to the Issuers that they have a current intention to sell
the Registrable Securities pursuant to the Shelf Registration such
financial and other relevant information and books and records of
the Issuers, and cause the officers, employees, counsel and
independent certified public accountants of the Issuers to respond
to such inquiries, as shall be reasonably necessary, in the
judgment of the respective counsel referred to in such Section, to
conduct a reasonable investigation within the meaning of Section 11
of the Securities Act; provided, however, that each such party
shall be required to maintain in confidence and not to disclose to
any other person any information or records reasonably designated
by the Issuers as being confidential, until such time as (A) such
information becomes a matter of public record (whether by virtue of
its inclusion in such registration statement or otherwise, except
as a result of a breach of this or any other obligation of
confidentiality to the Issuers), or (B) such person shall be
required so to disclose such information pursuant to a subpoena or
order of any court or other governmental agency or body having
jurisdiction over the matter (subject to the requirements of such
order, and only after such person shall have given the Issuers
prompt prior written notice of such requirement), or (C) such
information is required to be set forth in such Shelf Registration
Statement or the prospectus included therein or in an amendment to
such Shelf Registration Statement or an amendment or supplement to
such prospectus in order that such Shelf Registration Statement,
prospectus, amendment or supplement, as the case may be, complies
with applicable requirements of the federal securities laws and the
rules and regulations of the Commission and does not contain an
untrue statement of a material fact or omit to state therein a
material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances
then existing;
12
(viii) promptly notify each of the Electing Holders, any sales
or placement agent therefor and any underwriter thereof (which
notification may be made through any managing underwriter that is a
representative of such underwriter for such purpose) and confirm
such advice in writing, (A) when such Shelf Registration Statement
or the prospectus included therein or any prospectus amendment or
supplement or post-effective amendment has been filed, and, with
respect to such Shelf Registration Statement or any post-effective
amendment, when the same has become effective, (B) of any comments
by the Commission and by the blue sky or securities commissioner or
regulator of any state with respect thereto, or any request by the
Commission for amendments or supplements to such Shelf Registration
Statement or prospectus or for additional information, (C) of the
issuance by the Commission of any stop order suspending the
effectiveness of such Shelf Registration Statement or the
initiation or, to the knowledge of the Issuers, threatening of any
proceedings for that purpose, (D) if at any time the
representations and warranties of the Issuers contemplated by
Section 3(d)(xvii) or Section 5 hereof cease to be true and correct
in all material respects, (E) of the receipt by the Issuers of any
notification with respect to the suspension of the qualification of
the Registrable Securities for sale in any jurisdiction or the
initiation or, to the knowledge of the Issuers, threatening of any
proceeding for such purpose, or (F) if at any time when a
prospectus is required to be delivered under the Securities Act,
that such Shelf Registration Statement, prospectus, prospectus
amendment or supplement or post-effective amendment does not
conform in all material respects to the applicable requirements of
the Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission thereunder, or contains an untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing;
(ix) use their reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of such registration
statement or any post-effective amendment thereto as soon as
practicable;
(x) if requested by any managing underwriter or underwriters,
any placement or sales agent or any Electing Holder, promptly
incorporate in a prospectus supplement or post-effective amendment
such information as is required by the applicable rules and
regulations of the Commission, and as such managing underwriter or
underwriters, such agent or such Electing Holder specifies should
be included therein relating to the terms of the sale of such
Registrable Securities, including information (i) with respect to
the principal amount of Registrable Securities being sold by
13
such Electing Holder or agent or to any underwriters, the name and
description of such Electing Holder, agent or underwriter, the
offering price of such Registrable Securities, and any discount,
commission or other compensation payable in respect thereof and the
purchase price being paid therefor by such underwriters and (ii)
with respect to any other material terms of the offering of the
Registrable Securities to be sold by such Electing Holder or agent
or to such underwriters; and make all required filings of such
prospectus supplement or post-effective amendment upon notification
of the matters to be incorporated in such prospectus supplement or
post-effective amendment;
(xi) furnish to each Electing Holder, each placement or sales
agent, if any, therefor, each underwriter, if any, thereof and the
respective counsel referred to in Section 3(d)(vi) hereof an
executed copy (or, in the case of an Electing Holder, a conformed
copy) of such Shelf Registration Statement, each such amendment and
supplement thereto (in each case including all exhibits thereto (in
the case of an Electing Holder of Registrable Securities, upon
request) and documents incorporated by reference therein) and such
number of copies of such Shelf Registration Statement (excluding
exhibits thereto and documents incorporated by reference therein
unless specifically so requested by such Electing Holder, agent or
underwriter, as the case may be) and of the prospectus included in
such Shelf Registration Statement (including each preliminary
prospectus and any summary prospectus), in conformity in all
material respects with the applicable requirements of the
Securities Act and the Trust Indenture Act, and the rules and
regulations of the Commission thereunder, and such other documents,
as such Electing Holder, agent, if any, and underwriter, if any,
may reasonably request in order to facilitate the offering and
disposition of the Registrable Securities owned by such Electing
Holder, offered or sold by such agent or underwritten by such
underwriter and to permit such Electing Holder, agent and
underwriter to satisfy the prospectus delivery requirements of the
Securities Act; and the Issuers hereby consent to the use of such
prospectus (including such preliminary and summary prospectus) and
any amendment or supplement thereto by each such Electing Holder
and by any such agent and underwriter, in each case in the form
most recently provided to such person by the Issuers, in connection
with the offering and sale of the Registrable Securities covered by
the prospectus (including such preliminary and summary prospectus)
or any supplement or amendment thereto;
(xii) use their reasonable best efforts to (A) register or
qualify the Registrable Securities to be included in such Shelf
Registration Statement under such securities laws or blue sky laws
of such jurisdictions
14
as any Electing Holder and each placement or sales agent, if any,
therefor and underwriter, if any, thereof shall reasonably request,
(B) keep such registrations or qualifications in effect and comply
with such laws so as to permit the continuance of offers, sales and
dealings therein in such jurisdictions during the period the Shelf
Registration is required to remain effective under Section 2(b)
above and for so long as may be necessary to enable any such
Electing Holder, agent or underwriter to complete its distribution
of Notes pursuant to such Shelf Registration Statement and (C) take
any and all other actions as may be reasonably necessary or
advisable to enable each such Electing Holder, agent, if any, and
underwriter, if any, to consummate the disposition in such
jurisdictions of such Registrable Securities; provided, however,
that none of the Issuers shall be required for any such purpose to
(1) qualify as a foreign corporation or limited liability company,
as the case may be, in any jurisdiction wherein it would not
otherwise be required to qualify but for the requirements of this
Section 3(d)(xii), (2) consent to general service of process in any
such jurisdiction or (3) make any changes to its certificate of
incorporation or by-laws (or other organizational document) or any
agreement between it and holders of its ownership interests;
(xiii) use their reasonable best efforts to obtain the consent
or approval of each governmental agency or authority, whether
federal, state or local, which may be required to effect the Shelf
Registration or the offering or sale in connection therewith or to
enable the selling holder or holders to offer, or to consummate the
disposition of, their Registrable Securities;
(xiv) unless any Registrable Securities shall be in book-entry
only form, cooperate with the Electing Holders and the managing
underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be
sold, which certificates, if so required by any securities exchange
upon which any Registrable Securities are listed, shall be penned,
lithographed or engraved, or produced by any combination of such
methods, on steel engraved borders, and which certificates shall
not bear any restrictive legends; and, in the case of an
underwritten offering, enable such Registrable Securities to be in
such denominations and registered in such names as the managing
underwriters may request at least two business days prior to any
sale of the Registrable Securities;
(xv) provide a CUSIP number for all Registrable Securities, not
later than the applicable Effective Time;
15
(xvi) enter into one or more underwriting agreements,
engagement letters, agency agreements, "best efforts" underwriting
agreements or similar agreements, as appropriate, including
customary provisions relating to indemnification and contribution,
and take such other actions in connection therewith as any Electing
Holders of at least 20% in aggregate principal amount of the
Registrable Securities at the time outstanding shall request in
order to expedite or facilitate the disposition of such Registrable
Securities;
(xvii) whether or not an agreement of the type referred to in
Section 3(d)(xvi) hereof is entered into, and whether or not any
portion of the offering contemplated by the Shelf Registration is
an underwritten offering or is made through a placement or sales
agent or any other entity, (A) make such representations and
warranties to the Electing Holders and the placement or sales
agent, if any, therefor and the underwriters, if any, thereof in
form, substance and scope as are customarily made in connection
with an offering of debt securities pursuant to any appropriate
agreement or to a registration statement filed on the form
applicable to the Shelf Registration; (B) obtain an opinion of
counsel to the Issuers in customary form, subject to customary
limitations, assumptions and exclusions, and covering such matters,
of the type customarily covered by such an opinion, as the managing
underwriters, if any, or as any Electing Holders of at least 20% in
aggregate principal amount of the Registrable Securities at the
time outstanding may reasonably request, addressed to such Electing
Holder or Electing Holders and the placement or sales agent, if
any, therefor and the underwriters, if any, thereof and dated the
date of the Effective Time of such Shelf Registration Statement
(and if such Shelf Registration Statement contemplates an
underwritten offering of a part or all of the Registrable
Securities, dated the date of the closing under the underwriting
agreement relating thereto) (it being agreed that the matters to be
covered by such opinion shall include the matters set forth in
paragraphs (b) and (d) of Section 7 of the Purchase Agreement to
the extent applicable to an offering of this type); (C) obtain a
"cold comfort" letter or letters from the independent certified
public accountants of the Issuers addressed to the selling Electing
Holders, the placement or sales agent, if any, therefor or the
underwriters, if any, thereof, dated (i) the effective date of such
Shelf Registration Statement and (ii) the effective date of any
prospectus supplement to the prospectus included in such Shelf
Registration Statement or post-effective amendment to such Shelf
Registration Statement which includes unaudited or audited
financial statements as of a date or for a period subsequent to
that of the latest such statements included in such prospectus
(and, if such Shelf Registration Statement contemplates an
underwritten offering pursuant to any
16
prospectus supplement to the prospectus included in such Shelf
Registration Statement or post-effective amendment to such Shelf
Registration Statement which includes unaudited or audited
financial statements as of a date or for a period subsequent to
that of the latest such statements included in such prospectus,
dated the date of the closing under the underwriting agreement
relating thereto), such letter or letters to be in customary form
and covering such matters of the type customarily covered by
letters of such type; (D) deliver such documents and certificates,
including officers' certificates, as may be reasonably requested by
any Electing Holders of at least 20% in aggregate principal amount
of the Registrable Securities at the time outstanding or the
placement or sales agent, if any, therefor and the managing
underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or
those contained in Section 5(a) hereof and the compliance with or
satisfaction of any agreements or conditions contained in the
underwriting agreement or other similar agreement entered into by
the Issuers pursuant to Section 3(d)(xvi); and (E) undertake such
obligations relating to expense reimbursement, indemnification and
contribution as are provided in Section 6 hereof;
(xviii) notify in writing each holder of Registrable Securities
of any proposal by the Issuers to amend or waive any provision of
this Exchange and Registration Rights Agreement pursuant to Section
9(h) hereof and of any amendment or waiver effected pursuant
thereto, each of which notices shall contain the substance of the
amendment or waiver proposed or effected, as the case may be;
(xix) in the event that any broker-dealer registered under the
Exchange Act shall underwrite any Registrable Securities or
participate as a member of an underwriting syndicate or selling
group or "assist in the distribution" (within the meaning of the
Conduct Rules (the "Conduct Rules") of the National Association of
Securities Dealers, Inc. ("NASD") or any successor thereto, as
amended from time to time) thereof, whether as a holder of such
Registrable Securities or as an underwriter, a placement or sales
agent or a broker or dealer in respect thereof, or otherwise,
assist such broker-dealer in complying with the requirements of
such Conduct Rules, including by (A) if such Conduct Rules shall
so require, engaging a "qualified independent underwriter" (as
defined in such Conduct Rules) to participate in the preparation of
the Shelf Registration Statement relating to such Registrable
Securities, to exercise usual standards of due diligence in respect
thereto and, if any portion of the offering contemplated by such
Shelf Registration Statement is an underwritten offering or is made
through a placement or sales agent, to
17
recommend the yield of such Registrable Securities, (B)
indemnifying any such qualified independent underwriter to the
extent of the indemnification of underwriters provided in Section
6 hereof (or to such other customary extent as may be requested by
such underwriter), and (C) providing such information to such
broker-dealer as may be required in order for such broker-dealer to
comply with the requirements of the Conduct Rules; and
(xx) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as
soon as practicable but in any event not later than eighteen months
after the effective date of such Shelf Registration Statement, an
earning statement of the Company and its subsidiaries complying
with Section 11(a) of the Securities Act (including, at the option
of the Company, Rule 158 thereunder).
(e) In the event that the Issuers would be required, pursuant to
Section 3(d)(viii)(F) above, to notify the Electing Holders, the placement or
sales agent, if any, therefor and the managing underwriters, if any, thereof,
the Issuers shall prepare and furnish to each of the Electing Holders, to each
placement or sales agent, if any, and to each such underwriter, if any, a
reasonable number of copies of a prospectus supplemented or amended so that, as
thereafter delivered to purchasers of Registrable Securities, such prospectus
conforms in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act, and the rules and regulations of the
Commission thereunder, and shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances then
existing. Each Electing Holder agrees that upon receipt of any notice from the
Issuers pursuant to Section 3(d)(viii)(F) hereof, such Electing Holder shall
forthwith discontinue the disposition of Registrable Securities pursuant to the
Shelf Registration Statement applicable to such Registrable Securities until
such Electing Holder shall have received copies of such amended or supplemented
prospectus, and if so directed by the Issuers, such Electing Holder shall
deliver to the Issuers (at the Issuers' expense) all copies, other than
permanent file copies, then in such Electing Holder's possession of the
prospectus covering such Registrable Securities at the time of receipt of such
notice.
(f) In the event of a Shelf Registration, in addition to the
information required to be provided by each Electing Holder in its Notice and
Questionnaire, the Issuers may require such Electing Holder to furnish to the
Issuers such additional information regarding such Electing Holder and such
Electing Holder's intended method of distribution of Registrable Securities as
may be required in order to comply with the Securities Act. Each such Electing
Holder agrees to notify the Issuers as promptly as practicable of any inaccuracy
or change in information previously furnished by such
18
Electing Holder to the Issuers or of the occurrence of any event in either case
as a result of which any prospectus relating to such Shelf Registration contains
or would contain an untrue statement of a material fact regarding such Electing
Holder or such Electing Holder's intended method of disposition of such
Registrable Securities or omits to state any material fact regarding such
Electing Holder or such Electing Holder's intended method of disposition of such
Registrable Securities required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing,
and promptly to furnish to the Issuers any additional information required to
correct and update any previously furnished information or required so that such
prospectus shall not contain, with respect to such Electing Holder or the
disposition of such Registrable Securities, an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances then
existing.
4. Registration Expenses.
The Issuers agree, subject to the last sentence of this Section, to
bear and to pay or cause to be paid promptly all expenses incident to the
Issuers' performance of or compliance with this Exchange and Registration Rights
Agreement, including (a) all Commission and any NASD registration, filing and
review fees and expenses including fees and disbursements of counsel for the
placement or sales agent or underwriters in connection with such registration,
filing and review, (b) all fees and expenses in connection with the
qualification of the Notes for offering and sale under the securities laws and
blue sky laws referred to in Section 3(d)(xii) hereof and determination of their
eligibility for investment under the laws of such jurisdictions as any managing
underwriters or the Electing Holders may designate, including any fees and
disbursements of counsel for the Electing Holders or underwriters in connection
with such qualification and determination, (c) all expenses relating to the
preparation, printing, production, distribution and reproduction of each
registration statement required to be filed hereunder, each prospectus included
therein or prepared for distribution pursuant hereto, each amendment or
supplement to the foregoing, the expenses of preparing the Notes for delivery
and the expenses of printing or producing any underwriting agreements,
agreements among underwriters, selling agreements and blue sky or legal
investment memoranda and all other documents in connection with the offering,
sale or delivery of Notes to be disposed of (including certificates representing
the Notes), (d) messenger, telephone and delivery expenses relating to the
offering, sale or delivery of Notes and the preparation of documents referred in
clause (c) above, (e) fees and expenses of the Trustee under the Indenture, any
agent of the Trustee and any reasonable fees and expenses for counsel for the
Trustee and of any collateral agent or custodian, (f) internal expenses
(including all salaries and expenses of the Issuers' officers and employees
performing legal or accounting duties), (g) fees, disbursements and expenses of
counsel and independent certified public accountants of the Issuers (including
the expenses of any opinions or "cold comfort" letters required by or incident
to such
19
performance and compliance), (h) fees, disbursements and expenses of any
"qualified independent underwriter" engaged pursuant to Section 3(d)(xix)
hereof, (i) reasonable fees, disbursements and expenses of one counsel for the
Electing Holders retained in connection with a Shelf Registration, as selected
by the Electing Holders of at least a majority in aggregate principal amount of
the Registrable Securities held by Electing Holders (which counsel shall be
reasonably satisfactory to the Issuers), (j) any fees charged by securities
rating services for rating the Notes, and (k) reasonable fees, expenses and
disbursements of any other persons, including special experts, retained by the
Issuers in connection with such registration (collectively, the "Registration
Expenses"). To the extent that any Registration Expenses are incurred, assumed
or paid by any holder of Registrable Securities or any placement or sales agent
therefor or underwriter thereof, the Issuers shall reimburse such person for the
full amount of the Registration Expenses so incurred, assumed or paid promptly
after receipt of a request therefor. Notwithstanding the foregoing, the holders
of the Registrable Securities being registered shall pay all agency fees and
commissions and underwriting discounts and commissions attributable to the sale
of such Registrable Securities and the fees and disbursements of any counsel or
other advisors or experts retained by such holders (severally or jointly), other
than the counsel and experts specifically referred to above.
5. Representations, Warranties and Covenants.
Except with respect to clauses (a) and (b) below, the Issuers represent
and warrant to, and agree with, each Purchaser and each of the holders from time
to time of Registrable Securities the information set forth in this Section 5.
With respect to clauses (a) and (b) below, the Issuers covenant that:
(a) Each registration statement covering Registrable Securities and
each prospectus (including any preliminary or summary prospectus) contained
therein or furnished pursuant to Section 3(d) or Section 3(c) hereof and any
further amendments or supplements to any such registration statement or
prospectus, when it becomes effective or is filed with the Commission, as the
case may be, and, in the case of an underwritten offering of Registrable
Securities, at the time of the closing under the underwriting agreement relating
thereto, will conform in all material respects to the requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; and at all times subsequent to
the Effective Time when a prospectus would be required to be delivered under the
Securities Act, other than from (i) such time as a notice has been given to
holders of Registrable Securities pursuant to Section 3(d)(viii)(F) or Section
3(c)(iii)(F) hereof until (ii) such time as the Issuers furnishes an amended or
supplemented prospectus pursuant to Section 3(e) or Section 3(c)(iv) hereof,
each such registration statement, and each prospectus (including any
20
summary prospectus) contained therein or furnished pursuant to Section 3(d) or
Section 3(c) hereof, as then amended or supplemented, will conform in all
material respects to the requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing;
provided, however, that this covenant shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in
writing to the Issuers by a holder of Registrable Securities expressly for use
therein.
(b) Any documents incorporated by reference in any prospectus
referred to in Section 5(a) hereof, when they become or became effective or are
or were filed with the Commission, as the case may be, will conform or conformed
in all material respects to the requirements of the Securities Act or the
Exchange Act, as applicable, and none of such documents will contain or
contained an untrue statement of a material fact or will omit or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this covenant shall
not apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Issuers by a holder of Registrable
Securities expressly for use therein.
(c) The compliance by the Issuers with all of the provisions of this
Exchange and Registration Rights Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a material
breach of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement, lease, license, franchise
agreement, permit or other material agreement or instrument to which either of
the Issuers or any of their subsidiaries is a party or by which either of the
Issuers or any of their subsidiaries is bound or to which any of the property or
assets of the Issuers or any of their subsidiaries is subject, nor will such
action result in any violation of the provisions of the certificate of formation
or limited liability company agreement of the Company or the certificate of
incorporation or bylaws of Charter Capital or any statute or any order, rule or
regulation of any court or governmental agency or body, including without
limitation, the Communications Act of 1934, as amended, the Cable Communications
Policy Act of 1984, as amended, the Cable Television Consumer Protection and
Competition Act of 1992, as amended, and the Telecommunications Act of 1996
(collectively, the "Cable Acts") or any order, rule or regulation of the Federal
Communications Commission (the "FCC"), having jurisdiction over the Issuers or
any of their subsidiaries or any of their properties, except for any such
violation which would not materially impair the Issuers' ability to comply
herewith; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required, including, without limitation, under the Cable Acts or any order, rule
or regulation of the FCC, for the consummation by the Issuers of the
transactions contemplated by this Exchange and Registration Rights
21
Agreement, except the registration under the Securities Act of the Notes,
qualification of the Indenture under the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as may be required
under State Notes or blue sky laws in connection with the offering and
distribution of the Notes.
(d) This Exchange and Registration Rights Agreement has been duly
authorized, executed and delivered by the Issuers.
6. Indemnification.
(a) Indemnification by the Issuers. The Issuers, jointly and
severally, (i) will indemnify and hold harmless each of the holders of
Registrable Securities included in an Exchange Offer Registration Statement,
each of the Electing Holders of Registrable Securities included in a Shelf
Registration Statement and each person who participates as a placement or sales
agent or as an underwriter in any offering or sale of such Registrable
Securities against any losses, claims, damages or liabilities, joint or several,
to which such holder, agent or underwriter may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Exchange Offer Registration Statement or Shelf Registration Statement, as the
case may be, under which such Registrable Securities were registered under the
Securities Act, or any preliminary, final or summary prospectus contained
therein or furnished by the Issuers to any such holder, Electing Holder, agent
or underwriter, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and (ii) will reimburse such holder, such Electing Holder, such
agent and such underwriter for any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such action or claim
as such expenses are incurred; provided, however, that neither of the Issuers
shall be liable to any such persons in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
such registration statement, or preliminary, final or summary prospectus, or
amendment or supplement thereto, in reliance upon and in conformity with written
information furnished to the Issuers by such persons expressly for use therein.
(b) Indemnification by the Holders and any Agents and Underwriters.
The Issuers may require, as a condition to including any Registrable Securities
in any registration statement filed pursuant to Section 2(b) hereof and to
entering into any underwriting agreement or similar agreement with respect
thereto, that the Issuers shall have received an undertaking reasonably
satisfactory to them from the Electing Holder of such Registrable Securities
included in a Shelf Registration Statement and from each underwriter or agent
named in any such underwriting agreement or similar agreement,
22
severally and not jointly, to (i) indemnify and hold harmless the Issuers and
all other holders of Registrable Securities, against any losses, claims, damages
or liabilities to which the Issuers or such other holders of Registrable
Securities may become subject, under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in such registration statement, or any preliminary,
final or summary prospectus contained therein or furnished by the Issuers to any
such Electing Holder, agent or underwriter, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Issuers by such Electing Holder or underwriter
expressly for use therein, and (ii) reimburse the Issuers for any legal or other
expenses reasonably incurred by the Issuers in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that no such Electing Holder shall be required to undertake liability
to any person under this Section 6(b) for any amounts in excess of the dollar
amount of the proceeds to be received by such Electing Holder from the sale of
such Electing Holder's Registrable Securities pursuant to such registration.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party under subsection (a) or (b) above of written notice of the commencement of
any action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party pursuant to the indemnification provisions of
or contemplated by this Section 6, notify such indemnifying party in writing of
the commencement of such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party otherwise than under the indemnification provisions of or
contemplated by Section 6(a) or 6(b) hereof. In case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
of the commencement thereof, such indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, such indemnifying party shall
not be liable to such indemnified party for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified
23
party is an actual or potential party to such action or claim) unless such
settlement, compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability arising out of such action or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) Contribution. If for any reason the indemnification provisions
contemplated by Section 6(a) or Section 6(b) are unavailable to or insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages
or liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and the indemnified party in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault of such indemnifying party and
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by
such indemnifying party or by such indemnified party, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The parties hereto agree that it would not be just
and equitable if contributions pursuant to this Section 6(d) were determined by
pro rata allocation (even if the holders or any agents or underwriters or all of
them were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to in this Section 6(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, or liabilities (or actions in respect
thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6(d), no holder shall be required to contribute any
amount in excess of the amount by which the dollar amount of the proceeds
received by such holder from the sale of any Registrable Securities (after
deducting any fees, discounts and commissions applicable thereto) exceeds the
amount of any damages which such holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission, and no underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Registrable
Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The holders' and any underwriters' obligations in this
Section 6(d) to contribute shall be several in
24
proportion to the principal amount of Registrable Securities registered or
underwritten, as the case may be, by them and not joint.
(e) The obligations of the Issuers under this Section 6 shall be in
addition to any liability which the Issuers may otherwise have and shall extend,
upon the same terms and conditions, to each officer, director and partner of
each holder, agent and underwriter and each person, if any, who controls any
holder, agent or underwriter within the meaning of the Securities Act; and the
obligations of the holders and any agents or underwriters contemplated by this
Section 6 shall be in addition to any liability which the respective holder,
agent or underwriter may otherwise have and shall extend, upon the same terms
and conditions, to each officer (including any officer who signed any
registration statement), director, employee, representative or agent of the
Issuers and to each person, if any, who controls the Issuers within the meaning
of the Securities Act.
7. Underwritten Offerings.
(a) Selection of Underwriters. If any of the Registrable Securities
covered by the Shelf Registration are to be sold pursuant to an underwritten
offering, the managing underwriter or underwriters thereof shall be designated
by Electing Holders holding at least a majority in aggregate principal amount of
the Registrable Securities to be included in such offering, provided that such
designated managing underwriter or underwriters is or are reasonably acceptable
to the Issuers.
(b) Participation by Holders. Each holder of Registrable Securities
hereby agrees with each other such holder that no such holder may participate in
any underwritten offering hereunder unless such holder (i) agrees to sell such
holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
8. Rule 144.
Each of the Issuers covenants to the holders of Registrable Securities
that to the extent it shall be required to do so under the Exchange Act, it
shall timely file the reports required to be filed by it under the Exchange Act
or the Securities Act (including the reports under Section 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the
Commission under the Securities Act) and the rules and regulations adopted by
the Commission thereunder, and shall take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required from
time to time to enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitations of the exemption
provided by Rule 144
25
under the Securities Act, as such Rule may be amended from time to time, or any
similar or successor rule or regulation hereafter adopted by the Commission.
Upon the request of any holder of Registrable Securities in connection with that
holder's sale pursuant to Rule 144, the Issuers shall deliver to such holder a
written statement as to whether it has complied with such requirements.
9. Miscellaneous.
(a) No Inconsistent Agreements. The Issuers represent, warrant,
covenant and agree that they have not granted, and shall not grant, registration
rights with respect to Registrable Securities or any other Notes which would be
inconsistent with the terms contained in this Exchange and Registration Rights
Agreement.
(b) Specific Performance. The parties hereto acknowledge that there
would be no adequate remedy at law if the Issuers fail to perform any of their
obligations hereunder and that the Purchasers and the holders from time to time
of the Registrable Securities may be irreparably harmed by any such failure, and
accordingly agree that the Purchasers and such holders, in addition to any other
remedy to which they may be entitled at law or in equity, shall be entitled to
compel specific performance of the obligations of the Issuers under this
Exchange and Registration Rights Agreement in accordance with the terms and
conditions of this Exchange and Registration Rights Agreement, in any court of
the United States or any State thereof having jurisdiction.
(c) Notices. All notices, requests, claims, demands, waivers and
other communications hereunder shall be in writing and shall be deemed to have
been duly given (i) when delivered by hand, if delivered personally or by
courier, (ii) when sent by facsimile (with written confirmation of receipt),
provided that a copy is mailed by registered or certified mail, return receipt
requested or (iii) three days after being deposited in the mail (registered or
certified mail, postage prepaid, return receipt requested) as follows: If to the
Issuers, c/o Charter Communications Holdings, LLC, 12444 Powerscourt Drive,
Suite 100, St. Louis, Missouri, 63131, Attention: Secretary, and if to a holder,
to the address of such holder set forth in the security register or other
records of the Issuers, or to such other address as the Issuers or any such
holder may have furnished to the other in writing in accordance herewith, except
that notices of change of address shall be effective only upon receipt.
(d) Parties in Interest. All the terms and provisions of this
Exchange and Registration Rights Agreement shall be binding upon, shall inure to
the benefit of and shall be enforceable by the parties hereto and the holders
from time to time of the Registrable Securities and the respective successors
and assigns of the parties hereto and such holders. In the event that any
transferee of any holder of Registrable Securities shall acquire Registrable
Securities, in any manner, whether by gift, bequest, purchase, operation of law
or otherwise, such transferee shall, without any further writing or action
26
of any kind, be deemed a beneficiary hereof for all purposes and such
Registrable Securities shall be held subject to all of the terms of this
Exchange and Registration Rights Agreement, and by taking and holding such
Registrable Securities such transferee shall be entitled to receive the benefits
of, and be conclusively deemed to have agreed to be bound by all of the
applicable terms and provisions of this Exchange and Registration Rights
Agreement. If the Issuers shall so request, any such successor, assign or
transferee shall agree in writing to acquire and hold the Registrable Securities
subject to all of the applicable terms hereof.
(e) Survival. The respective indemnities, agreements,
representations, warranties and each other provision set forth in this Exchange
and Registration Rights Agreement or made pursuant hereto shall remain in full
force and effect regardless of any investigation (or statement as to the results
thereof) made by or on behalf of any holder of Registrable Securities, any
director, officer or partner of such holder, any agent or underwriter or any
director, officer or partner thereof, or any controlling person of any of the
foregoing, and shall survive delivery of and payment for the Registrable
Securities pursuant to the Purchase Agreement and the transfer and registration
of Registrable Securities by such holder and the consummation of an Exchange
Offer.
(f) Governing Law. This Exchange and Registration Rights Agreement
shall be governed by and construed in accordance with the laws of the State of
New York.
(g) Headings. The descriptive headings of the several Sections and
paragraphs of this Exchange and Registration Rights Agreement are inserted for
convenience only, do not constitute a part of this Exchange and Registration
Rights Agreement and shall not affect in any way the meaning or interpretation
of this Exchange and Registration Rights Agreement.
(h) Entire Agreement; Amendments. This Exchange and Registration
Rights Agreement and the other writings referred to herein (including the
Indenture and the form of Notes) or delivered pursuant hereto which form a part
hereof contain the entire understanding of the parties with respect to its
subject matter. This Exchange and Registration Rights Agreement supersedes all
prior agreements and understandings between the parties with respect to its
subject matter. This Exchange and Registration Rights Agreement may be amended
and the observance of any term of this Exchange and Registration Rights
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively) only by a written instrument duly executed by
the Issuers and the holders of at least a majority in aggregate principal amount
of the Registrable Securities at the time outstanding. Each holder of any
Registrable Securities at the time or thereafter outstanding shall be bound by
any amendment or waiver effected pursuant to this Section 9(h), whether or not
any notice, writing or marking indicating
27
such amendment or waiver appears on such Registrable Securities or is delivered
to such holder.
(i) Inspection. For so long as this Exchange and Registration Rights
Agreement shall be in effect, this Exchange and Registration Rights Agreement
and a complete list of the names and addresses of all the holders of Registrable
Securities shall be made available for inspection and copying, upon reasonable
prior notice, on any business day during normal business hours by any holder of
Registrable Securities for proper purposes only (which shall include any purpose
related to the rights of the holders of Registrable Securities under the Notes,
the Indenture and this Agreement) at the offices of the Issuers at the address
thereof set forth in Section 9(c) above and at the office of the Trustee under
the Indenture.
(j) Counterparts. This agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
28
If the foregoing is in accordance with your understanding, please sign
and return to us counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Issuers.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Issuers for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
Very truly yours,
CHARTER COMMUNICATIONS HOLDINGS, LLC, as
an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
CHARTER COMMUNICATIONS HOLDINGS
CAPITAL CORPORATION, as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
29
Accepted as of the date hereof:
GOLDMAN, SACHS & CO.
MORGAN STANLEY & CO. INCORPORATED
BANC OF AMERICA SECURITIES LLC
BEAR, STEARNS & CO. INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SALOMON SMITH BARNEY INC.
JP MORGAN, A DIVISION OF CHASE SECURITIES INC.
CREDIT LYONNAIS SECURITIES (USA) INC.
FLEET SECURITIES, INC.
BMO NESBITT BURNS CORP.
DRESDNER KLEINWORT WASSERSTEIN SECURITIES LLC
By: GOLDMAN, SACHS & CO
By: /s/ GOLDMAN, SACHS & CO.
-------------------------------------
Name:
Title:
By: MORGAN STANLEY & CO. INCORPORATED
By: /s/ IRENE MAVROYANNIS
--------------------------------
Name: Irene Mavroyannis
Title: Vice President
30
EXHIBIT A
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
INSTRUCTION TO DTC PARTICIPANTS
-------------------------------
(Date of Mailing)
URGENT - IMMEDIATE ATTENTION REQUESTED
DEADLINE FOR RESPONSE: [DATE](a)
The Depository Trust Issuers ("DTC") has identified you as a DTC
Participant through which beneficial interests in the Charter Communications
Holdings, LLC (the "Company") and Charter Communications Holdings Capital
Corporation ("Charter Capital" and, together with the Company, the "Issuers")
10.000% Senior Notes due 2011 (the "Notes") are held.
The Issuers are in the process of registering the Notes under the
Securities Act of 1933, as amended, for resale by the beneficial owners thereof.
In order to have their Notes included in the registration statement, beneficial
owners must complete and return the enclosed Notice of Registration Statement
and Selling Securityholder Questionnaire.
It is important that beneficial owners of the Notes receive a copy of
the enclosed materials as soon as possible as their rights to have the Notes
included in the registration statement depend upon their returning the Notice
and Questionnaire by [Deadline For Response]. Please forward a copy of the
enclosed documents to each beneficial owner that holds interests in the Notes
through you. If you require more copies of the enclosed materials or have any
questions pertaining to this matter, please contact the Issuers c/o Charter
Communications Holdings, LLC, 12444 Powerscourt Drive, Suite 100, St. Louis,
Missouri, 63131, Attention: Secretary.
(a) Not less than 28 calendar days from date of mailing.
A-1
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
Notice of Registration Statement
and
Selling Securityholder Questionnaire
(Date)
Reference is hereby made to the Exchange and Registration Rights
Agreement (the "Exchange and Registration Rights Agreement") between Charter
Communications Holdings, LLC and Charter Communications Holdings Capital
Corporation (together, the "Issuers"), and the Purchasers named therein.
Pursuant to the Exchange and Registration Rights Agreement, the Issuers have
filed with the United States Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (the "Shelf Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities Act"), of the Issuers' 10.000% Senior Notes
due 2011 (the "Notes"). A copy of the Exchange and Registration Rights Agreement
is attached hereto. All capitalized terms not otherwise defined herein shall
have the meanings ascribed thereto in the Exchange and Registration Rights
Agreement.
Each beneficial owner of Registrable Securities is entitled to have the
Registrable Securities beneficially owned by it included in the Shelf
Registration Statement. In order to have Registrable Securities included in the
Shelf Registration Statement, this Notice of Registration Statement and Selling
Securityholder Questionnaire ("Notice and Questionnaire") must be completed,
executed and delivered to the Issuers' counsel at the address set forth herein
for receipt ON OR BEFORE [Deadline for Response]. Beneficial owners of
Registrable Securities who do not complete, execute and return this Notice and
Questionnaire by such date (i) will not be named as selling securityholders in
the Shelf Registration Statement and (ii) may not use the Prospectus forming a
part thereof for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Shelf Registration
Statement and related prospectus.
A-2
ELECTION
The undersigned holder (the "Selling Securityholder") of Registrable
Securities hereby elects to include in the Shelf Registration Statement the
Registrable Securities beneficially owned by it and listed below in Item (3).
The undersigned, by signing and returning this Notice and Questionnaire, agrees
to be bound with respect to such Registrable Securities by the terms and
conditions of this Notice and Questionnaire and the Exchange and Registration
Rights Agreement, including, without limitation, Section 6 of the Exchange and
Registration Rights Agreement, as if the undersigned Selling Securityholder were
an original party thereto.
Upon any sale of Registrable Securities pursuant to the Shelf
Registration Statement, the Selling Securityholder will be required to deliver
to the Issuers and the Trustee the Notice of Transfer set forth in Exhibit B to
the Exchange and Registration Rights Agreement.
The Selling Securityholder hereby provides the following information to
the Issuers and represents and warrants that such information is accurate and
complete:
QUESTIONNAIRE
(1) (a) Full Legal Name of Selling Securityholder:
(b) Full Legal Name of Registered Holder (if not the same as in (a)
above) of Registrable Securities Listed in Item (3) below:
(c) Full Legal Name of DTC Participant (if applicable and if not the
same as (b) above) Through Which Registrable Securities Listed in Item (3) below
are Held:
(2) Address for Notices to Selling Securityholder:
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Telephone:
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Fax:
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Contact Person:
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A-3
(3) Beneficial Ownership of Notes:
Except as set forth below in this Item (3), the undersigned does not
beneficially own any Notes.
(a) Principal amount of Registrable Securities beneficially owned:
_________________________________________________________________
CUSIP No(s). of such Registrable Securities:_____________________
(b) Principal amount of Notes other than Registrable Securities
beneficially owned: _____________________________________________
CUSIP No(s). of such other Notes: _______________________________
(c) Principal amount of Registrable Securities which the undersigned
wishes to be included in the Shelf Registration Statement:
___________________
CUSIP No(s). of such Registrable Securities to be included in the
Shelf Registration Statement:____________________________________
(4) Beneficial Ownership of Other Securities of the Issuers:
Except as set forth below in this Item (4), the undersigned
Selling Securityholder is not the beneficial or registered owner
of any other securities of the Issuers other than the Notes
listed above in Item (3).
State any exceptions here:
(5) Relationships with the Issuers:
Except as set forth below, neither the Selling Securityholder nor
any of its affiliates, officers, directors or principal equity
holders (5% or more) has held any position or office or has had
any other material relationship with the Issuers (or their
respective predecessors or affiliates) during the past three
years.
State any exceptions here:
(6) Plan of Distribution:
Except as set forth below, the undersigned Selling Securityholder
intends to distribute the Registrable Securities listed above in
Item (3) only as follows (if at all): Such Registrable Securities
may be sold from time to
A-4
time directly by the undersigned Selling Securityholder or,
alternatively, through underwriters, broker-dealers or agents.
Such Registrable Securities may be sold in one or more
transactions at fixed prices, at prevailing market prices at the
time of sale, at varying prices determined at the time of sale,
or at negotiated prices. Such sales may be effected in
transactions (which may involve crosses or block transactions)
(i) on any national securities exchange or quotation service on
which the Registered Notes may be listed or quoted at the time of
sale, (ii) in the over-the-counter market, (iii) in transactions
otherwise than on such exchanges or services or in the
over-the-counter market, or (iv) through the writing of options.
In connection with sales of the Registrable Securities or
otherwise, the Selling Securityholder may enter into hedging
transactions with broker-dealers, which may in turn engage in
short sales of the Registrable Securities in the course of
hedging the positions they assume. The Selling Securityholder may
also sell Registrable Securities short and deliver Registrable
Securities to close out such short positions, or loan or pledge
Registrable Securities to broker-dealers that in turn may sell
such Notes.
State any exceptions here:
By signing below, the Selling Securityholder acknowledges that it understands
its obligation to comply, and agrees that it will comply, with the provisions of
the Exchange Act and the rules and regulations thereunder, particularly
Regulation M.
In the event that the Selling Securityholder transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Issuers, the Selling Securityholder agrees to
notify the transferee(s) at the time of the transfer of its rights and
obligations under this Notice and Questionnaire and the Exchange and
Registration Rights Agreement.
By signing below, the Selling Securityholder consents to the disclosure of the
information contained herein in its answers to Items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and
related Prospectus. The Selling Securityholder understands that such information
will be relied upon by the Issuers in connection with the preparation of the
Shelf Registration Statement and related Prospectus.
In accordance with the Selling Securityholder's obligation under Section 3(d) of
the Exchange and Registration Rights Agreement to provide such information as
may be required by law for inclusion in the Shelf Registration Statement, the
Selling Securityholder agrees to promptly notify the Issuers of any inaccuracies
or changes in the
A-5
information provided herein which may occur subsequent to the date hereof at any
time while the Shelf Registration Statement remains in effect. All notices
hereunder and pursuant to the Exchange and Registration Rights Agreement shall
be made in writing, by hand-delivery, first-class mail, or air courier
guaranteeing overnight delivery as follows:
(i) To the Issuers:
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-------------------------
-------------------------
-------------------------
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(ii) With a copy to:
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Once this Notice and Questionnaire is executed by the Selling Securityholder and
received by the Issuers' counsel, the terms of this Notice and Questionnaire,
and the representations and warranties contained herein, shall be binding on,
shall inure to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives, and assigns of the Issuers and the
Selling Securityholder (with respect to the Registrable Securities beneficially
owned by such Selling Securityholder and listed in Item (3) above). This
Agreement shall be governed in all respects by the laws of the State of New York
without giving effect to any provisions relating to conflicts of laws.
A-6
IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.
Dated:
------------------------------
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Selling Securityholder
(Print/type full legal name of beneficial owner of Registrable Securities)
By
------------------------------------------------------------
Name:
Title:
A-7
PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON
OR BEFORE [DEADLINE FOR RESPONSE] TO THE ISSUERS' COUNSEL AT:
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A-8
EXHIBIT B
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
BNY Midwest Trust Company
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o BNY Midwest Trust Company
2 N. LaSalle, Suite 1020
Chicago, Illinois 60602
Attention: Trust Officer
Re: Charter Communications Holdings, LLC
and Charter Communications Holdings Capital Corporation
(together, the "Issuers") 10.000% Senior Notes due 2011
Dear Sirs:
Please be advised that ______________ has transferred $__________ aggregate
principal amount of the above-referenced Notes pursuant to an effective
Registration Statement on Form S-3 (File No. 333-____) filed by the Issuers.
We hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933, as amended, have been satisfied and that the above-named
beneficial owner of the Notes is named as a "Selling Holder" in the prospectus
dated [date] or in supplements thereto, and that the aggregate principal amount
of the Notes transferred are the Notes listed in such prospectus opposite such
owner's name.
Dated:
Very truly yours,
----------------------------------
(Name)
By:
------------------------------
(Authorized Signature)
B-1
INDENTURE dated as of May 15, 2001 among Charter Communications
Holdings, LLC, a Delaware limited liability company (as further defined below,
the "Company"), Charter Communications Holdings Capital Corporation, a Delaware
corporation (as further defined below, "Charter Capital" and together with the
Company, the "Issuers"), and BNY Midwest Trust Company, as trustee (the
"Trustee").
The Issuers and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the 11.750% Senior
Discount Notes due 2011 (the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
------------
"Accreted Value" is defined to mean, for any specified date, the amount
calculated pursuant to (i), (ii), (iii) or (iv) for each $ 1,000 of principal
amount at maturity of the Notes:
(i) if the specified date occurs on one or more of the following dates
(excluding the Issue Date, each a "Semi-Annual Accrual Date"), the Accreted
Value will equal the amount set forth below for such Semi-Annual Accrual Date:
Semi-Annual Accrual Date Accreted Value
------------------------ --------------
Issue Date $565.02
November 15, 2001 598.21
May 15, 2002 633.36
November 15, 2002 670.57
May 15, 2003 709.96
November 15, 2003 751.67
May 15, 2004 795.84
November 15, 2004 842.59
May 15, 2005 892.09
November 15, 2005 944.51
May 15, 2006 $1000.00
(ii) if the specified date occurs before the first Semi-Annual Accrual
Date, the Accreted Value will equal the sum of (a) $565.02 and (b) an amount
equal to the product of (1) the Accreted Value for the first Semi-Annual Accrual
Date less $565.02 multiplied by (2) a fraction, the numerator of which is the
number of days from the Issue Date of the
Notes to the specified date, using a 360-day year of twelve 30-day months, and
the denominator of which is the number of days elapsed from the Issue Date to
the first Semi-Annual Accrual Date, using a 360-day year of twelve 30-day
months;
(iii) if the specified date occurs between two Semi-Annual Accrual
Dates, the Accreted Value will equal the sum of (a) the Accreted Value for the
Semi-Annual Accrual Date immediately preceding such specified date and (b) an
amount equal to the product of (1) the Accreted Value for the immediately
following Semi-Annual Accrual Date less the Accreted Value for the immediately
preceding Semi-Annual Accrual Date multiplied by (2) a fraction, the numerator
of which is the number of days from the immediately preceding Semi-Annual
Accrual Date to the specified date, using a 360-day year of twelve 30-day
months, and the denominator of which is 180; or
(iv) if the specified date occurs after the last Semi-Annual Accrual
Date, the Accreted Value will equal $1,000.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified Person,
whether or not such Indebtedness is incurred in connection with, or in
contemplation of, such other Person merging with or into, or becoming a
Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling, "controlled by" and "under common control
with" shall have correlative meanings.
"Agent" means any Registrar or Paying Agent.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of the Depositary, Euroclear and Clearstream, in each case to the
extent applicable to such transaction and as in effect from time to time.
2
"Asset Acquisition" means (a) an Investment by the Company or any of the
Company's Restricted Subsidiaries in any other Person pursuant to which such
Person shall become a Restricted Subsidiary of the Company or any of its
Restricted Subsidiaries or shall be merged with or into the Company or any of
the Company's Restricted Subsidiaries, or (b) the acquisition by the Company or
any of the Company's Restricted Subsidiaries of the assets of any Person which
constitute all or substantially all of the assets of such Person, any division
or line of business of such Person or any other properties or assets of such
Person other than in the ordinary course of business.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any assets or
rights, other than sales of inventory in the ordinary course of business
consistent with past practices; provided that the sale, conveyance or other
disposition of all or substantially all of the assets of the Company and its
Restricted Subsidiaries, taken as a whole, shall be governed by Section 4.16
and/or Section 5.01 and not by the provisions of Section 4.11; and
(2) the issuance of Equity Interests by any of the Company's Restricted
Subsidiaries or the sale of Equity Interests in any of the Company's Restricted
Subsidiaries.
Notwithstanding the preceding, the following items shall not be deemed
to be Asset Sales:
(1) any single transaction or series of related transactions that: (a)
involves assets having a fair market value of less than $100 million; or (b)
results in net proceeds to the Company and its Restricted Subsidiaries of less
than $100 million;
(2) a transfer of assets between or among the Company and its Restricted
Subsidiaries;
(3) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary of the Company to the Company or to another Wholly Owned Restricted
Subsidiary of the Company;
(4) a Restricted Payment that is permitted by Section 4.07 and a
Restricted Investment that is permitted by Section 4.08; and
(5) the incurrence of Permitted Liens and the disposition of assets
related to such Permitted Liens by the secured party pursuant to a foreclosure.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value of the obligation of the
lessee for net rental
3
payments during the remaining term of the lease included in such sale and
leaseback transaction including any period for which such lease has been
extended or may, at the option of the lessee, be extended. Such present value
shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or
state law of any jurisdiction relating to bankruptcy, insolvency, winding up,
liquidation, reorganization or relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as such term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire, whether such
right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition.
"Board of Directors" means the Manager or the Board of Directors of the
Company or the Board of Directors of Charter Capital, as the case may be, or any
authorized committee of the Board of Directors of the Company or Charter
Capital, as the case may be.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company or Charter Capital, as the
case may be, to have been duly adopted by the Board of Directors of the Company
or Charter Capital, as the case may be, and to be in full force and effect on
the date of such certification and delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Cable Related Business" means the business of owning cable television
systems and businesses ancillary, complementary and related thereto.
"Capital Lease Obligation" means, at the time any determination thereof
is to be made, the amount of the liability in respect of a capital lease that
would at that time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
4
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest (other than any debt obligation) or participation
that confers on a Person the right to receive a share of the profits and losses
of, or distributions of assets of, the issuing Person.
"Capital Stock Sale Proceeds" means the aggregate net cash proceeds
(including the fair market value of the non-cash proceeds, as determined by an
independent appraisal firm) received by the Company since March 17, 1999 (x) as
a contribution to the common equity capital or from the issue or sale of Equity
Interests of the Company (other than Disqualified Stock) or (y) from the issue
or sale of convertible or exchangeable Disqualified Stock or convertible or
exchangeable debt securities of the Company that have been converted into or
exchanged for such Equity Interests (other than Equity Interests (or
Disqualified Stock or debt securities) sold to a Subsidiary of the Company).
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality thereof (provided that
the full faith and credit of the United States is pledged in support thereof)
having maturities of not more than twelve months from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with maturities
of twelve months or less from the date of acquisition, bankers' acceptances with
maturities not exceeding six months and overnight bank deposits, in each case,
with any domestic commercial bank having combined capital and surplus in excess
of $500 million and a Thompson Bank Watch Rating at the time of acquisition of
"B" or better;
(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications specified
in clause (3) above;
(5) commercial paper having a rating of at least "P-1" from Moody's or
at least "A-1" from S&P and in each case maturing within twelve months after the
date of acquisition;
(6) corporate debt obligations maturing within twelve months after the
date of acquisition thereof, rated at the time of acquisition at least "Aaa" or
"P-1" by Moody's or "AAA" or "A-1" by S&P;
5
(7) auction-rate preferred stocks of any corporation maturing not later
than 45 days after the date of acquisition thereof, rated at the time of
acquisition at least "Aaa" by Moody's or "AAA" by S&P;
(8) securities issued by any state, commonwealth or territory of the
United States, or by any political subdivision or taxing authority thereof,
maturing not later than six months after the date of acquisition thereof, rated
at the time of acquisition at least "A" by Moody's or S&P; and
(9) money market or mutual funds at least 90% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1) through (8) of
this definition.
"Change of Control" means the occurrence of any of the following:
(1) the sale, transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of the Company and its Subsidiaries,
taken as a whole, or of a Parent and its Subsidiaries, taken as a whole, to any
"person" (as such term is used in Section 13(d)(3) of the Exchange Act) other
than the Principal or a Related Party of the Principal;
(2) the adoption of a plan relating to the liquidation or dissolution
of the Company or a Parent;
(3) the consummation of any transaction (including, without limitation,
any merger or consolidation) the result of which is that any "person" (as
defined above), other than the Principal and Related Parties, becomes the
Beneficial Owner, directly or indirectly, of more than 35% of the Voting Stock
of the Company or a Parent, measured by voting power rather than the number of
shares, unless the Principal or a Related Party Beneficially Owns, directly or
indirectly, a greater percentage of Voting Stock of the Company or such Parent,
as the case may be, measured by voting power rather than the number of shares,
than such person;
(4) after the Issue Date, the first day on which a majority of the
members of the Board of Directors of the Company or the board of directors of a
Parent are not Continuing Directors; or
(5) the Company or a Parent consolidates with, or merges with or into,
any Person, or any Person consolidates with, or merges with or into, the Company
or a Parent, in any such event pursuant to a transaction in which any of the
outstanding Voting Stock of the Company or such Parent is converted into or
exchanged for cash, securities or other property, other than any such
transaction where the Voting Stock of the Company or such Parent outstanding
immediately prior to such transaction is converted into or exchanged for Voting
Stock (other than Disqualified Stock) of the surviving or
6
transferee Person constituting a majority of the outstanding shares of such
Voting Stock of such surviving or transferee Person immediately after giving
effect to such issuance.
"Charter Capital" means Charter Communications Holdings Capital
Corporation, a Delaware corporation, and any successor in interest thereto.
"Clearstream" means Clearstream Banking, societe anonyme (formerly
Cedelbank).
"Commission" or "SEC" means the Securities and Exchange Commission.
"Company" means Charter Communications Holdings, LLC, a Delaware limited
liability company, and any successor in interest thereto.
"Consolidated EBITDA" means with respect to any Person, for any period,
the net income of such Person and its Restricted Subsidiaries for such period
plus, to the extent such amount was deducted in calculating such net income:
(1) Consolidated Interest Expense;
(2) income taxes;
(3) depreciation expense;
(4) amortization expense;
(5) all other non-cash items, extraordinary items, nonrecurring and
unusual items and the cumulative effects of changes in accounting principles
reducing such net income, less all non-cash items, extraordinary items,
nonrecurring and unusual items and cumulative effects of changes in accounting
principles increasing such net income, all as determined on a consolidated basis
for such Person and its Restricted Subsidiaries in conformity with GAAP;
(6) amounts actually paid during such period pursuant to a deferred
compensation plan; and
(7) for purposes of Section 4.10 only, Management Fees;
provided that Consolidated EBITDA shall not include:
(x) the net income (or net loss) of any Person that is not a Restricted
Subsidiary ("Other Person"), except (i) with respect to net income, to the
extent of the amount of dividends or other distributions actually paid to such
Person or any of its Restricted Subsidiaries by such Other Person during such
period and (ii) with respect to
7
net losses, to the extent of the amount of investments made by such Person or
any Restricted Subsidiary of such Person in such Other Person during such
period;
(y) solely for the purposes of calculating the amount of Restricted
Payments that may be made pursuant to clause (3) of Section 4.07 (and in such
case, except to the extent includable pursuant to clause (x) above) the net
income (or net loss) of any Other Person accrued prior to the date it becomes a
Restricted Subsidiary or is merged into or consolidated with such Person or any
Restricted Subsidiaries or all or substantially all of the property and assets
of such Other Person are acquired by such Person or any of its Restricted
Subsidiaries; and
(z) the net income of any Restricted Subsidiary of the Company to the
extent that the declaration or payment of dividends or similar distributions by
such Restricted Subsidiary of such net income is not at the time permitted by
the operation of the terms of such Restricted Subsidiary's charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Restricted Subsidiary (other than any agreement or
instrument evidencing Indebtedness or Preferred Stock (i) outstanding on the
Issue Date, or (ii) incurred or issued thereafter in compliance with Section
4.10, provided that (a) the terms of any such agreement or instrument
restricting the declaration and payment of dividends or similar distributions
apply only in the event of a default with respect to a financial covenant or a
covenant relating to payment (beyond any applicable period of grace) contained
in such agreement or instrument, (b) such terms are determined by such Person to
be customary in comparable financings and (c) such restrictions are determined
by the Company not to materially affect the Issuers' ability to make principal
or interest payments on the Notes when due).
"Consolidated Indebtedness" means, with respect to any Person as of any
date of determination, the sum, without duplication, of:
(1) the total amount of outstanding Indebtedness of such Person and
its Restricted Subsidiaries, plus
(2) the total amount of Indebtedness of any other Person that has been
Guaranteed by the referent Person or one or more of its Restricted Subsidiaries,
plus
(3) the aggregate liquidation value of all Disqualified Stock of such
Person and all Preferred Stock of Restricted Subsidiaries of such Person, in
each case, determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any Person for
any period, without duplication, the sum of:
(1) the consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued (including, without
limitation,
8
amortization or original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, commissions,
discounts and other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net payments (if any) pursuant to Hedging
Obligations); and
(2) the consolidated interest expense of such Person and its Restricted
Subsidiaries that was capitalized during such period; and
(3) any interest expense on Indebtedness of another Person that is
guaranteed by such Person or one of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or one of its Restricted Subsidiaries (whether or
not such Guarantee or Lien is called upon);
excluding, however, any amount of such interest of any Restricted Subsidiary of
the referent Person if the net income of such Restricted Subsidiary is excluded
in the calculation of Consolidated EBITDA pursuant to clause (z) of the
definition thereof (but only in the same proportion as the net income of such
Restricted Subsidiary is excluded from the calculation of Consolidated EBITDA
pursuant to clause (z) of the definition thereof), in each case, on a
consolidated basis and in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company or the board of directors of a
Parent who:
(1) was a member of such board of directors on the Issue Date; or
(2) was nominated for election or elected to such board of directors
with the approval of a majority of the Continuing Directors who were members of
such board of directors at the time of such nomination or election or whose
election or appointment was previously so approved.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 10.02 or such other address as to which the Trustee
may give notice to the Issuers.
"Credit Facilities" means, with respect to the Company and/or its
Restricted Subsidiaries, one or more debt facilities or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced or refinanced
in whole or in part from time to time.
9
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06, substantially in
the form of Exhibit A hereto, except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Global Notes, the Person
specified in Section 2.03 as the Depositary with respect to the Notes, and any
and all successors thereto appointed as depositary hereunder and having become
such pursuant to the applicable provision of this Indenture.
"Disposition" means, with respect to any Person, any merger,
consolidation or other business combination involving such Person (whether or
not such Person is the surviving Person) or the sale, assignment, or transfer,
lease conveyance or other disposition of all or substantially all of such
Person's assets or Capital Stock.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
date on which the Notes mature. Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase such Capital
Stock upon the occurrence of a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock provide that
the Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.07.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means any private or underwritten public offering of
Qualified Capital Stock of the Company or a Parent of which the gross proceeds
(x) to the Company or (y) received by the Company as a capital contribution from
such Parent, as the case may be, are at least $25 million.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
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"Exchange Notes" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f).
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries in existence on the Issue Date, until such amounts are
repaid.
"Full Accretion Date" means May 15, 2006, the first date on which the
Accreted Value of the Notes has accreted to an amount equal to the principal
amount at maturity of the Notes.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the Issue Date.
"Global Note Legend" means the legend set forth in Section 2.06(g)(ii),
which is required to be placed on all Global Notes issued under this Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" or "guarantee" means a guarantee other than by endorsement
of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a
pledge of assets or through letters of credit or reimbursement agreements in
respect thereof, of all or any part of any Indebtedness, measured as the lesser
of the aggregate outstanding amount of the Indebtedness so guaranteed and the
face amount of the guarantee.
"Hedging Obligations" means, with respect to any Person, the obligations
of such Person under:
(1) interest rate swap agreements, interest rate cap agreements and
interest rate collar agreements;
11
(2) interest rate option agreements, foreign currency exchange
agreements, foreign currency swap agreements; and
(3) other agreements or arrangements designed to protect such Person
against fluctuations in interest and currency exchange rates.
"Helicon Preferred Stock" means the preferred limited liability company
interest of Charter-Helicon LLC with an aggregate liquidation value of $25
million outstanding on the Issue Date.
"Holder" means a holder of the Notes.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
(5) in respect of the balance deferred and unpaid of the purchase price
of any property, except any such balance that constitutes an accrued expense or
trade payable; or
(6) representing the notional amount of any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by such Person of any indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date shall be:
(1) the accreted value thereof, in the case of any Indebtedness
issued with original issue discount; and
(2) the principal amount thereof, together with any interest thereon
that is more than 30 days past due, in the case of any other Indebtedness.
12
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest in
a Global Note through a Participant.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act that is not also a QIB.
"Investment Grade Rating" means a rating equal to or higher than Baa3
(or the equivalent) by Moody's and BBB- (or the equivalent) by S&P.
"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business) and
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
"Issue Date" means May 15, 2001.
"Issuers" has the meaning assigned to it in the preamble to this
Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in The City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Issuers and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"Leverage Ratio" means, as of any date, the ratio of:
(1) the Consolidated Indebtedness of the Company on such date to
(2) the aggregate amount of Consolidated EBITDA for the Company for the
most recently ended fiscal quarter for which internal financial statements are
available multiplied by four (the "Reference Period").
13
In addition to the foregoing, for purposes of this definition,
"Consolidated EBITDA" shall be calculated on a pro forma basis after giving
effect to:
(1) the issuance of the Notes;
(2) the incurrence of the Indebtedness or the issuance of the
Disqualified Stock or other Preferred Stock of a Restricted Subsidiary (and the
application of the proceeds therefrom) giving rise to the need to make such
calculation and any incurrence or issuance (and the application of the proceeds
therefrom) or repayment of other Indebtedness or Disqualified Stock or other
Preferred Stock of a Restricted Subsidiary, other than the incurrence or
repayment of Indebtedness for ordinary working capital purposes, at any time
subsequent to the beginning of the Reference Period and on or prior to the date
of determination, as if such incurrence (and the application of the proceeds
thereof), or the repayment, as the case may be, occurred on the first day of the
Reference Period; and
(3) any Dispositions or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of such Person or one of its Restricted Subsidiaries
(including any person that becomes a Restricted Subsidiary as a result of such
Asset Acquisition) incurring, assuming or otherwise becoming liable for or
issuing Indebtedness, Disqualified Stock or Preferred Stock) made on or
subsequent to the first day of the Reference Period and on or prior to the date
of determination, as if such Disposition or Asset Acquisition (including the
incurrence, assumption or liability for any such Indebtedness, Disqualified
Stock or Preferred Stock and also including any Consolidated EBITDA associated
with such Asset Acquisition, including any cost savings adjustments in
compliance with Regulation S-X promulgated by the Commission) had occurred on
the first day of the Reference Period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Management Fees" means the fees payable to Charter Communications, Inc.
pursuant to the management agreements between Charter Communications, Inc. and
Charter Communications Operating, LLC and between Charter Communications, Inc.
and Restricted Subsidiaries of the Company and pursuant to the limited liability
company agreements of certain Restricted Subsidiaries, as such management or
limited liability company agreements exist on the Issue Date (or, if later, on
the date any new Restricted Subsidiary is acquired or created), including any
amendment or replacement thereof,
14
provided that any such amendment or replacement is not more disadvantageous to
the Holders of the Notes in any material respect from such management or limited
liability company agreements existing on the Issue Date.
"Manager" means Charter Communications, Inc., in its capacity as manager
of the Company under the Company's limited liability company agreement, dated as
of February 9, 1999, as amended from time to time, and any successor manager
appointed pursuant to such limited liability company agreement.
"Moody's" means Moody's Investors Service, Inc. or any successor to the
rating agency business thereof.
"Net Proceeds" means the aggregate cash proceeds received by the Company
or any of its Restricted Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale, including, without limitation, legal, accounting
and investment banking fees, and sales commissions, and any relocation expenses
incurred as a result thereof or taxes paid or payable as a result thereof
(including amounts distributable in respect of owners', partners' or members'
tax liabilities resulting from such sale), in each case after taking into
account any available tax credits or deductions and any tax sharing arrangements
and amounts required to be applied to the repayment of Indebtedness.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness), (b) is directly or
indirectly liable as a guarantor or otherwise, or (c) constitutes the lender;
(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any
other Indebtedness (other than the Notes) of the Company or any of its
Restricted Subsidiaries to declare a default on such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its stated maturity;
and
(3) as to which the lenders have been notified in writing that they will
not have any recourse to the Capital Stock or assets of the Company or any of
its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
15
"Note" or "Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company or Charter Capital, as the case may be, by two Officers of the Company
or Charter Capital, as the case may be, one of whom must be the principal
executive officer, the chief financial officer or the treasurer of the Company
or Charter Capital, as the case may be, that meets the requirements of Section
10.05.
"Opinion of Counsel" means an opinion from legal counsel that meets the
requirements of Section 10.05. The counsel may be an employee of or counsel to
the Issuers or any Subsidiary of the Issuers.
"Other Notes" means the 9.625% Senior Notes due 2009 of the Issuers in
an aggregate principal amount not to exceed the principal amount issued on the
Issue Date, and the 10.000% Senior Notes due 2011 of the Issuers in an aggregate
principal amount not to exceed the principal amount issued on the Issue Date.
"Parent" means Charter Communications, Inc. and/or Charter
Communications Holding Company, LLC, as applicable, and any successor Person or
any Person succeeding to the direct or indirect ownership of the Company.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Investments" means:
(1) any Investment by the Company in a Restricted Subsidiary of the
Company, or any Investment by a Restricted Subsidiary of the Company in the
Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary of the
Company in a Person, if as a result of such Investment:
16
(a) such Person becomes a Restricted Subsidiary of the Company;
or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Restricted Subsidiary of the Company;
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in compliance
with Section 4.11;
(5) any Investment made out of the net cash proceeds of the issue and
sale since March 17, 1999 (other than to a Subsidiary of the Company) of Equity
Interests (other than Disqualified Stock) of the Company to the extent that (a)
such net cash proceeds have not been applied to make a Restricted Payment or to
effect other transactions pursuant to Section 4.07 or (b) such net cash proceeds
have not been used to incur Indebtedness pursuant to clause (10) of Section
4.10;
(6) Investments in Productive Assets having an aggregate fair market
value (measured on the date each such Investment was made and without giving
effect to subsequent changes in value), when taken together with all other
Investments in Productive Assets made by the Company and its Restricted
Subsidiaries pursuant to this clause (6) since March 17, 1999, not to exceed
$150 million; provided that either the Company or any of its Restricted
Subsidiaries, after giving effect to such Investments, will own at least 20% of
the Voting Stock of any Person in which any such Investment is made;
(7) other Investments in any Person having an aggregate fair market
value (measured on the date each such Investment was made and without giving
effect to subsequent changes in value), when taken together with all other
Investments in any Person made by the Company and its Restricted Subsidiaries
pursuant to this clause (7) since March 17, 1999, not to exceed $50 million; and
(8) Investments in customers and suppliers in the ordinary course of
business which either (A) generate accounts receivable or (B) are accepted in
settlement of bona fide disputes.
"Permitted Liens" means:
(1) Liens on the assets of the Company securing Indebtedness and
other Obligations under clause (1) of Section 4.10;
(2) Liens in favor of the Company;
(3) Liens on property of a Person existing at the time such Person is
merged with or into or consolidated with the Company; provided that such Liens
were in
17
existence prior to the contemplation of such merger or consolidation and do not
extend to any assets other than those of the Person merged into or consolidated
with the Company;
(4) Liens on property existing at the time of acquisition thereof by the
Company; provided that such Liens were in existence prior to the contemplation
of such acquisition;
(5) Liens to secure the performance of statutory obligations, surety or
appeal bonds, performance bonds or other obligations of a like nature incurred
in the ordinary course of business;
(6) purchase money mortgages or other purchase money liens (including
without limitation any Capital Lease Obligations) incurred by the Company upon
any fixed or capital assets acquired after the Issue Date or purchase money
mortgages (including without limitation Capital Lease Obligations) on any such
assets, whether or not assumed, existing at the time of acquisition of such
assets, whether or not assumed, so long as (i) such mortgage or lien does not
extend to or cover any of the assets of the Company, except the asset so
developed, constructed, or acquired, and directly related assets such as
enhancements and modifications thereto, substitutions, replacements, proceeds
(including insurance proceeds), products, rents and profits thereof, and (ii)
such mortgage or lien secures the obligation to pay the purchase price of such
asset, interest thereon and other charges, costs and expenses (including,
without limitation, the cost of design, development, construction, acquisition,
transportation, installation, improvement, and migration) and is incurred in
connection therewith (or the obligation under such Capital Lease Obligation)
only;
(7) Liens existing on the Issue Date (other than in connection with
the Credit Facilities);
(8) Liens for taxes, assessments or governmental charges or claims that
are not yet delinquent or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded; provided that any
reserve or other appropriate provision as shall be required in conformity with
GAAP shall have been made therefor;
(9) statutory and common law Liens of landlords and carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other similar
Liens arising in the ordinary course of business and with respect to amounts not
yet delinquent or being contested in good faith by appropriate legal proceedings
promptly instituted and diligently conducted and for which a reserve or other
appropriate provision, if any, as shall be required in conformity with GAAP
shall have been made;
18
(10) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security;
(11) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligation, bankers' acceptance,
surety and appeal bonds, government contracts, performance and return-of-money
bonds and other obligations of a similar nature incurred in the ordinary course
of business (exclusive of obligations for the payment of borrowed money);
(12) easements, rights-of-way, municipal and zoning ordinances and
similar charges, encumbrances, title defects or other irregularities that do not
materially interfere with the ordinary course of business of the Company or any
of its Restricted Subsidiaries;
(13) Liens of franchisors or other regulatory bodies arising in the
ordinary course of business;
(14) Liens arising from filing Uniform Commercial Code financing
statements regarding leases or other Uniform Commercial Code financing
statements for precautionary purposes relating to arrangements not constituting
Indebtedness;
(15) Liens arising from the rendering of a final judgment or order
against the Company or any of its Restricted Subsidiaries that does not give
rise to an Event of Default;
(16) Liens securing reimbursement obligations with respect to letters of
credit that encumber documents and other property relating to such letters of
credit and the products and proceeds thereof;
(17) Liens encumbering customary initial deposits and margin deposits,
and other Liens that are within the general parameters customary in the industry
and incurred in the ordinary course of business, in each case, securing
Indebtedness under Hedging Obligations and forward contracts, options, future
contracts, future options or similar agreements or arrangements designed solely
to protect the Company or any of its Restricted Subsidiaries from fluctuations
in interest rates, currencies or the price of commodities;
(18) Liens consisting of any interest or title of licensor in the
property subject to a license;
(19) Liens on the Capital Stock of Unrestricted Subsidiaries;
(20) Liens arising from sales or other transfers of accounts receivable
which are past due or otherwise doubtful of collection in the ordinary course of
business;
19
(21) Liens incurred in the ordinary course of business of the Company
with respect to obligations which in the aggregate do not exceed $50 million at
any one time outstanding;
(22) Liens in favor of the Trustee arising under the provisions in this
Indenture and in the indentures relating to the Other Notes, in each case under
Section 7.07; and
(23) Liens in favor of the Trustee for its benefit and the benefit of
Holders and the holders of the Other Notes, as their respective interests
appear.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund, other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that unless permitted otherwise
by this Indenture, no Indebtedness of the Company or any of its Restricted
Subsidiaries, may be issued in exchange for, nor may the net proceeds of
Indebtedness be used to extend, refinance, renew, replace, defease or refund,
Indebtedness of the Company or any of its Restricted Subsidiaries; provided,
further, that:
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount of (or
accreted value, if applicable), plus accrued interest and premium, if any, on
the Indebtedness so extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of reasonable expenses incurred in connection
therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the Notes, such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the Notes on
terms at least as favorable to the Holders of Notes as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company or by any of its
Restricted Subsidiaries who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Preferred Stock," as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which by its terms is
preferred in right
20
of payment of dividends, or as to the distribution of assets upon any voluntary
or involuntary liquidation or dissolution of such Person, over shares of Capital
Stock of any other class of such Person.
"Person" means any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"Principal" means Paul G. Allen.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i)(A) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"Productive Assets" means assets (including assets of a referent Person
owned directly or indirectly through ownership of Capital Stock) of a kind used
or useful in the Cable Related Business.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Stock.
"Rating Agencies" means Moody's and S&P.
"Registration Rights Agreement" means the Exchange and Registration
Rights Agreement dated as of the Issue Date among the Issuers and the initial
purchasers named therein with respect to the Notes issued on the Issue Date.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a global note substantially in the form
of Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of, the
Depositary or its nominee that will be issued in an initial denomination equal
to the outstanding principal amount at maturity of the Notes initially sold in
reliance on Rule 903 of Regulation S.
"Related Party" means:
(1) the spouse or an immediate family member, estate or heir of the
Principal; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially holding an
80% or more
21
controlling interest of which consist of the Principal and/or such other Persons
referred to in the immediately preceding clause (1).
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 144A Global Note" means a global note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in an initial denomination equal
to the outstanding principal amount at maturity of the Notes sold in reliance on
Rule 144A.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"S&P" means Standard & Poor's Ratings Service, a division of the
McGraw-Hill Companies, Inc. or any successor to the rating agency business
thereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" means the Shelf Registration Statement as
defined in the Registration Rights Agreement.
22
"Significant Subsidiary" means any Restricted Subsidiary of the Company
which is a "Significant Subsidiary" as defined in Rule 1-02(w) of Regulation S-X
under the Exchange Act.
"Special Interest" has the meaning set forth in the Registration Rights
Agreement.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness on the Issue Date, or, if none, the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person:
(1) any corporation, association or other business entity of which at
least 50% of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof) and, in the case of any such entity of
which 50% of the total voting power of shares of Capital Stock is so owned or
controlled by such Person or one or more of the other Subsidiaries of such
Person, such Person and its Subsidiaries also have the right to control the
management of such entity pursuant to contract or otherwise; and
(2) any partnership (a) the sole general partner or the managing general
partner of which is such Person or a Subsidiary of such Person or (b) the only
general partners of which are such Person or of one or more Subsidiaries of such
Person (or any combination thereof).
"Tax" shall mean any tax, duty, levy, impost, assessment or other
governmental charge (including penalties, interest and any other liabilities
related thereto).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA; provided, however, that in the event the Trust Indenture Act of
1939 is amended after such date, then "TIA" means, to the extent required by
such amendment, the Trust Indenture Act of 1939 as so amended.
"Trustee" means BNY Midwest Trust Company until a successor replaces BNY
Midwest Trust Company in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
23
"Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global note substantially
in the form of Exhibit A attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that such
Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the Company
unless the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than those
that might be obtained at the time from Persons who are not Affiliates of the
Company unless such terms constitute Investments permitted under Section 4.08;
(3) is a Person with respect to which neither the Company nor any of its
Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe
for additional Equity Interests or (b) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results;
(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of the Company or any of its Restricted
Subsidiaries; and
(5) has at least one director on its board of directors that is not a
director or executive officer of the Company or any of its Restricted
Subsidiaries, or has at least one executive officer that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries.
"U.S. Person" means a U.S. person as defined in Rule 902(k) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the board of
directors of such Person.
24
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount of
each then remaining installment, sinking fund, serial maturity or other required
payments of principal, including payment at final maturity, in respect thereof,
by (b) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person and/or by one or more Wholly Owned Restricted
Subsidiaries of such Person.
Section 1.02. Other Definitions.
-----------------
Defined in
Term Section
- ---- -------
"Affiliate Transaction"............... 4.13
"Asset Sale Offer".................... 3.09
"Authentication Order"................ 2.02
"Change of Control Offer"............. 4.16
"Change of Control Payment"........... 4.16
"Change of Control Payment Date"...... 4.16
"Covenant Defeasance"................. 8.03
"DTC"................................. 2.03
"Event of Default".................... 6.01
"Excess Proceeds"..................... 4.11
"incur"............................... 4.10
"Legal Defeasance".................... 8.02
"Offer Amount"........................ 3.09
"Offer Period"........................ 3.09
"Paying Agent"........................ 2.03
"Payment Default"..................... 6.01
"Permitted Debt"..................... 4.10
"Preferred Stock Financing"........... 4.10
"Purchase Date"....................... 3.09
"Registrar"........................... 2.03
"Restricted Payments"................. 4.07
25
Defined in
Term Section
- ---- -------
"Subordinated Debt Financing"......... 4.10
"Subordinated Notes".................. 4.10
"Subsidiary Guarantee"................ 4.17
"Suspended Covenants"................. 4.19
Section 1.03. Incorporation by Reference of Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Issuers and any successor obligor upon
the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.04. Rules of Construction.
---------------------
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural
include the singular;
(e) provisions apply to successive events and transactions;
26
(f) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the SEC from time to time;
(g) references to any statute, law, rule or regulation shall be
deemed to refer to the same as from time to time amended and in effect and to
any successor statute, law, rule or regulation; and
(h) references to any contract, agreement or instrument shall mean
the same as amended, modified, supplemented or amended and restated from time to
time, in each case, in accordance with any applicable restrictions contained in
this Indenture.
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating.
---------------
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 principal amount at maturity and integral
multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Issuers and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially
in the form of Exhibit A attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and each shall provide that it shall represent the
aggregate principal amount at maturity of outstanding Notes from time to time
endorsed thereon and that the aggregate principal amount at maturity of
outstanding Notes represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges and redemptions. Any endorsement
of a Global Note to reflect the
27
amount of any increase or decrease in the aggregate principal amount at maturity
of outstanding Notes represented thereby shall be made by the Trustee or the
custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06.
(c) Euroclear and Clearstream Procedures Applicable. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream (or, in each case,
equivalent documents setting forth the procedures at Euroclear and Clearstream)
shall be applicable to transfers of beneficial interests in the Regulation S
Global Notes that are held by Participants through Euroclear or Clearstream.
Section 2.02. Execution and Authentication.
----------------------------
Two Officers shall sign the Notes for each Issuer by manual or facsimile
signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
(which may be by facsimile) of the Trustee. The signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Issuers signed by an
Officer of each of the Issuers (an "Authentication Order"), authenticate Notes
for original issue in the aggregate principal amount at maturity of
$1,018,000,000. The aggregate principal amount at maturity of Notes outstanding
at any time may not exceed such amount except as provided in Section 2.07. On
the Issue Date, the Issuers will issue $1,018,000,000 aggregate principal amount
at maturity of Notes. Notes offered and sold in reliance on the exemption from
registration under the Securities Act provided by Section 4(2) thereunder or
Rule 144A shall be issued as one or more Rule 144A Global Notes. Notes offered
and sold in offshore transactions in reliance on Regulation S shall be issued as
one or more Regulation S Global Notes.
The Trustee may appoint an authenticating agent acceptable to the
Issuers to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Issuers.
28
Section 2.03. Registrar and Paying Agent.
--------------------------
The Issuers shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Issuers may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Issuers may change any
Paying Agent or Registrar without notice to any Holder. The Issuers shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Issuers fail to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Issuers or any of
their Subsidiaries may act as Paying Agent or Registrar.
The Issuers initially appoint The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Issuers initially appoint the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
-----------------------------------
The Issuers shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
Accreted Value, premium, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Issuers in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Issuers at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Issuers or a Subsidiary) shall have no further
liability for the money. If the Issuers or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Issuers, the Trustee shall serve as Paying Agent for
the Notes.
Section 2.05. Holder Lists.
------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Issuers shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of
29
such date as the Trustee may reasonably require of the names and addresses of
the Holders of Notes and the Issuers shall otherwise comply with TIA ss. 312(a).
Section 2.06. Transfer and Exchange.
---------------------
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes shall be exchanged
by the Company for Definitive Notes if:
(i) the Issuers deliver to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that
it is no longer a clearing agency registered under the Exchange Act and,
in either case, a successor Depositary is not appointed by the Issuers
within 120 days after the date of such notice from the Depositary; or
(ii) the Issuers in their sole discretion determine that the Global
Notes (in whole but not in part) should be exchanged for Definitive
Notes and deliver a written notice to such effect to the Trustee; or
(iii) there shall have occurred and be continuing a Default or Event
of Default with respect to the Notes.
Upon the occurrence of any of the preceding events in (i), (ii) or (iii)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10, shall be authenticated
and delivered in the form of, and shall be, a Global Note. A Global Note may not
be exchanged for another Note other than as provided in this Section 2.06(a);
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.06(b), (c) or (f).
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth herein to the extent required by the Securities Act. Prior to the
expiration of the 40-day distribution compliance period set forth in Regulation
S, beneficial interests in any Regulation S Global Note may be held only through
Euroclear or Clearstream unless transferred in accordance with
30
Section 2.06(b)(iii)(A). Transfers of beneficial interests in the Global Notes
also shall require compliance with either subparagraph (i) or (ii) below, as
applicable, as well as one or more of the other following subparagraphs, as
applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest
in the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend. Beneficial
interests in any Unrestricted Global Note may be transferred to Persons
who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall be
required to be delivered to the Registrar to effect the transfers
described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interest that are not subject to Section 2.06(b)(i) above,
the transferor of such beneficial interest must deliver to the Registrar
either:
(A)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to credit or cause
to be credited a beneficial interest in another Global Note in an
amount equal to the beneficial interest to be transferred or
exchanged; and
(A)(2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant
account to be credited with such increase; or
(B)(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be
issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged; and
(B)(2) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above.
Upon consummation of an Exchange Offer by the Issuers in accordance with
Section 2.06(f), the requirements of this Section 2.06(b)(ii) shall be
deemed to have been satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal delivered by the
holder of such beneficial interests in the
31
Restricted Global Notes. Upon satisfaction of all of the requirements
for transfer or exchange of beneficial interests in Global Notes
contained in this Indenture and the Notes or otherwise applicable under
the Securities Act, the Trustee shall adjust the principal amount at
maturity of the relevant Global Note(s) pursuant to Section 2.06(h).
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the Rule 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of
a beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may be
exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of
Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the
Issuers;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
32
(C) such transfer is effected by a broker-dealer pursuant
to the Exchange Registration Statement in accordance with the
Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a beneficial interest in an
Unrestricted Global Note, a certificate from such holder
in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in
a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note, a certificate from such holder
in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or
(D) above at a time when an Unrestricted Global Note has not yet been
issued, the Issuers shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.02, the Trustee shall authenticate
one or more Unrestricted Global Notes in an aggregate principal amount
at maturity equal to the aggregate principal amount at maturity of
beneficial interests transferred pursuant to subparagraph (B) or (D)
above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
33
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of a Restricted
Definitive Note, then, upon receipt by the Registrar of the following
documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof (provided that any such
beneficial interest in Regulation S Global Note shall not be so
exchangeable until after the expiration of the 40-day
distribution compliance period set forth in Regulation S);
(B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to
a Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other
than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3)(d) thereof, if applicable;
(F) if such beneficial interest is being transferred to
the Issuers or any of their Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
34
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount at maturity of the
applicable Global Note to be reduced accordingly pursuant to Section 2.06(h),
and the Issuers shall execute and the Trustee shall authenticate and deliver to
the Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of such beneficial interest, in the case
of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not
(1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant
to the Exchange Offer Registration Statement in accordance with
the Registration Rights Agreement; or
35
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a Definitive Note that does not
bear the Private Placement Legend, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in item (1)(b) thereof; or
(2) if the holder of such beneficial interest in
a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a Definitive Note that does not
bear the Private Placement Legend, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to the
effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section
2.06(b)(ii), the Trustee shall cause the aggregate principal amount at
maturity of the applicable Global Note to be reduced accordingly
pursuant to Section 2.06(h), and the Issuers shall execute and the
Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant
to this Section 2.06(c)(iii) shall be registered in such name or names
and in such authorized denomination or denominations as the holder of
such beneficial interest shall instruct the Registrar through
instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive
Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall not bear the Private Placement Legend.
36
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests
in Global Notes.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive Notes
to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted
Global Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (2)(b)
thereof;
(B) if such Restricted Definitive Note is being transferred
to a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being transferred
to a Non-U.S. Person in an offshore transaction in accordance
with Rule 903 or Rule 904 under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred
to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D)
above, a certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such Restricted Definitive Note is being transferred
to the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the
Securities Act, a
37
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased the aggregate principal amount at maturity of, in
the case of clause (A) above, the appropriate Restricted Global Note, in
the case of clause (B) above, the Rule 144A Global Note, in the case of
clause (C) above, the Regulation S Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Issuers;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a broker-dealer pursuant
to the Exchange Offer Registration Statement in accordance with
the Registration Rights Agreement; or
(D) such exchange or transfer is effected after the
expiration of the 40-day distribution compliance period set forth
in Regulation S and the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder
in the form of Exhibit C hereto, including the
certifications in item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder
in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
38
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount at
maturity of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note at any time. Upon receipt of a request for such an exchange
or transfer, the Trustee shall cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the aggregate
principal amount at maturity of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B),
(ii)(D) or (iii) above at a time when an Unrestricted Global Note has
not yet been issued, the Issuers shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount at maturity equal to the principal amount at maturity
of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of
transfer or exchange, the requesting Holder shall present or surrender to the
Registrar the Definitive Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by its attorney, duly authorized in writing. In addition, the
requesting Holder shall provide any additional certifications, documents and
information, as applicable, required pursuant to the following provisions of
this Section 2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes.
Any Restricted Definitive Note may be transferred to and registered in
the name of
39
Persons who take delivery thereof in the form of a Restricted Definitive
Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item (2)
thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive
Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person
or Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Issuers;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a broker-dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) such exchange or transfer is effected after the 40-day
distribution compliance period set forth in Regulation S and the
Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted
Definitive
40
Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item
(1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such Holder in the form of
Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Issuers to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such Notes
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Definitive Notes pursuant
to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Issuers shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount at maturity equal to the principal amount at maturity
of the beneficial interests in the Restricted Global Notes tendered for
acceptance by Persons that certify in the applicable Letters of Transmittal that
(x) they are not broker-dealers, (y) they are not participating in a
distribution of the Exchange Notes and (z) they are not affiliates (as defined
in Rule 144) of the Issuers, and accepted for exchange in the Exchange Offer and
(ii) Definitive Notes in an aggregate principal amount at maturity equal to the
principal amount at maturity of the Restricted Definitive Notes accepted for
exchange in the Exchange Offer. Concurrently with the issuance of such Notes,
the Trustee shall cause the aggregate principal amount at maturity of the
applicable Restricted Global Notes to be reduced accordingly, and the Issuers
shall execute and the Trustee shall authenticate and deliver to the Persons
designated by the Holders of Definitive Notes so accepted Definitive Notes in
the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
41
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend
in substantially the following form:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
(A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT SUBJECT TO THE CERTIFICATION AND
DELIVERY REQUIREMENTS OF THE INDENTURE GOVERNING THE NOTES, (3)
TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT SUBJECT
TO THE CERTIFICATION AND DELIVERY REQUIREMENTS OF THE INDENTURE
GOVERNING THE NOTES, (4) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF
THE UNITED STATES."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv),
(c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to
this Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement
Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend
in substantially the following form:
42
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER
ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS
HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE,
(II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT
TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE
DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF
THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS."
(h) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11. At any
time prior to such cancellation, if any beneficial interest in a Global Note is
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note or for Definitive Notes,
the principal amount at maturity of Notes represented by such Global Note shall
be reduced accordingly and an endorsement shall be made on such Global Note by
the Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Issuers shall execute and the Trustee shall authenticate Global Notes
and Definitive Notes upon the Issuers' order or at the Registrar's
request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Issuers may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge
43
payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.09,
4.11, 4.16 and 9.05).
(iii) The Registrar shall not be required to register the transfer
of or exchange any Note selected for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Issuers, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global
Notes or Definitive Notes surrendered upon such registration of transfer
or exchange.
(v) The Issuers shall not be required (A) to issue, to
register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 and ending at the
close of business on the day of selection, (B) to register the transfer
of or to exchange any Note so selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part
or (C) to register the transfer of or to exchange a Note between a
record date and the next succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a transfer
of any Note, the Trustee, any Agent and the Issuers may deem and treat
the Person in whose name any Note is registered as the absolute owner
of such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the
Trustee, any Agent or the Issuers shall be affected by notice to the
contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06
to effect a registration of transfer or exchange may be submitted by
facsimile.
Section 2.07. Replacement Notes.
-----------------
If any mutilated Note is surrendered to the Trustee or the Issuers and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Issuers shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Issuers, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Issuers to protect the Issuers, the
44
Trustee, any Agent and any authenticating agent from any loss that any of them
may suffer if a Note is replaced. The Issuers may charge for their expenses in
replacing a Note.
Every replacement Note is an additional legally binding obligation of
the Issuers and shall be entitled to all of the benefits of this Indenture
equally and proportionately with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes.
-----------------
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions of this Indenture, and those described in this
Section as not outstanding. Except as set forth in Section 2.09, a Note does not
cease to be outstanding because either of the Issuers or an Affiliate of the
Issuers holds the Note; however, Notes held by an Issuer or a Subsidiary of an
Issuer shall not be deemed to be outstanding for purposes of Section 3.07(b).
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the Accreted Value of any Note is considered paid under Section 4.01,
it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than an Issuer, a Subsidiary or an Affiliate
of any thereof) holds, on a redemption date or maturity date, money sufficient
to pay Notes payable on that date, then on and after that date such Notes shall
be deemed to be no longer outstanding and shall cease to accrue interest.
Section 2.09. Treasury Notes.
--------------
In determining whether the Holders of the required principal amount at
maturity of Notes have concurred in any direction, waiver or consent, Notes
owned by an Issuer, or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with an Issuer, shall
be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that a Responsible Officer of the
Trustee knows are so owned shall be so disregarded.
45
Section 2.10. Temporary Notes.
---------------
Until certificates representing Notes are ready for delivery, the
Issuers may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Issuers
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Issuers shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
Section 2.11. Cancellation.
------------
The Issuers at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
such canceled Notes in its customary manner. The Issuers may not issue new Notes
to replace Notes that they have paid or that have been delivered to the Trustee
for cancellation.
Section 2.12. Defaulted Interest.
------------------
If the Issuers default in a payment of interest on the Notes, they shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01. The Issuers shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment. The Issuers shall fix or cause to be fixed each such
special record date and payment date; provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Issuers (or, upon
the written request of the Issuers, the Trustee in the name and at the expense
of the Issuers) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
46
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.
------------------
If the Issuers elect to redeem Notes pursuant to the optional redemption
provisions of Section 3.07, it shall furnish to the Trustee, at least 30 days
but not more than 60 days before a redemption date, an Officers' Certificate
setting forth (i) the clause of this Indenture pursuant to which the redemption
shall occur, (ii) the redemption date, (iii) the Accreted Value of Notes to be
redeemed and (iv) the redemption price.
Section 3.02. Selection of Notes to Be Redeemed.
---------------------------------
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee shall select the Notes to be redeemed
or purchased among the Holders of the Notes in compliance with the requirements
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and appropriate. In
the event of partial redemption by lot, the particular Notes to be redeemed
shall be selected, unless otherwise provided herein, not less than 30 nor more
than 60 days prior to the redemption date by the Trustee from the outstanding
Notes not previously called for redemption.
The Trustee shall promptly notify the Issuers in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the Accreted Value thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 principal amount at maturity or
whole multiples of $1,000 principal amount at maturity; except that if all of
the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes
held by such Holder, even if not a multiple of $1,000 principal amount at
maturity, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption.
--------------------
Subject to the provisions of Section 3.09, at least 30 days but not more
than 60 days before a redemption date, the Issuers shall mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose Notes
are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
47
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
Accreted Value or the principal amount at maturity of such Note to be redeemed
and that, after the redemption date upon surrender of such Note, a new Note or
Notes in principal amount at maturity equal to the unredeemed portion shall be
issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Issuers default in making such redemption
payment, interest on Notes called for redemption ceases to accrue, or the
Accreted Value on the Notes ceases to increase, as the case may be, on and after
the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Issuers' request, the Trustee shall give the notice of redemption
in the Issuers' name and at their expense; provided, however, that each of the
Issuers shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
Section 3.04. Effect of Notice of Redemption.
------------------------------
Once notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.
Section 3.05. Deposit of Redemption Price.
---------------------------
At or prior to 10:00 a.m., New York City time, on the redemption date,
the Issuers shall deposit with the Trustee or with the Paying Agent money
sufficient to pay the redemption price of and accrued interest on all Notes to
be redeemed on that date. The Trustee or the Paying Agent shall promptly return
to the Issuers any money deposited with the Trustee or the Paying Agent by the
Issuers in excess of the amounts necessary to pay the redemption price of, and
accrued interest on, all Notes to be redeemed.
48
If the Issuers comply with the provisions of the preceding paragraph, on
and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related interest payment date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Issuers to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest not paid on
such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01.
Section 3.06. Notes Redeemed in Part.
----------------------
Upon surrender of a Note that is redeemed in part, the Issuers shall
issue and, upon the Issuers' written request, the Trustee shall authenticate for
the Holder at the expense of the Issuers a new Note equal in principal amount to
the unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption.
-------------------
(a) Except as set forth in clause (b) of this Section 3.07, the Issuers
shall not have the option to redeem the Notes pursuant to this Section 3.07
prior to May 15, 2006. Thereafter, the Issuers shall have the option to redeem
the Notes, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount
at maturity) set forth below plus accrued and unpaid interest thereon, if any,
to the applicable redemption date, if redeemed during the twelve-month period
beginning on May 15 of the years indicated below:
Year Percentage
---- ----------
2006 105.875%
2007 103.917%
2008 101.958%
2009 and thereafter 100.000%
(b) Notwithstanding the provisions of clause (a) of this Section 3.07,
at any time prior to May 15, 2004, the Issuers may, on any one or more
occasions, redeem up to 35% of the aggregate principal amount at maturity of
the Notes originally issued under this Indenture on a pro rata basis (or nearly
as pro rata as practicable) at a redemption price of 111.750% of the Accreted
Value thereof, plus, after the Full Accretion Date, accrued and unpaid interest
to the redemption date, with the net cash proceeds of one or more Equity
Offerings; provided that
49
(1) at least 65% of the aggregate principal amount at maturity of
Notes originally issued under this Indenture remains outstanding
immediately after the occurrence of such redemption (excluding Notes
held by the Company and its Subsidiaries); and
(2) the redemption must occur within 60 days of the date of the
closing of such Equity Offering.
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06.
Section 3.08. Mandatory Redemption.
--------------------
Except as otherwise provided in Section 4.11 or Section 4.16 below, the
Issuers shall not be required to make mandatory redemption payments with respect
to the Notes.
Section 3.09. Offer to Purchase by Application of Excess Proceeds.
---------------------------------------------------
In the event that the Issuers shall be required to commence an offer to
all Holders to purchase Notes pursuant to Section 4.11 (an "Asset Sale Offer"),
they shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Issuers shall purchase the principal amount at maturity of Notes required to
be purchased pursuant to Section 4.11 (the "Offer Amount") or, if less than the
Offer Amount has been tendered, all Notes tendered in response to the Asset Sale
Offer. Payment for any Notes so purchased shall be made in the same manner as
interest payments are made. Unless the Issuers default in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest after the Purchase Date.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no Special Interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer the Issuers shall send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
50
(a) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.11 and the length of time the Asset Sale Offer shall remain
open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue
to accrue interest;
(d) that, unless the Issuers default in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer or may elect to have Notes purchased in integral multiples of
$1,000 principal amount at maturity only;
(f) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Issuers, a depositary, if appointed by
the Issuers, or a Paying Agent at the address specified in the notice at least
three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Issuers, the depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount at maturity of the Note the Holder delivered for purchase and a statement
that such Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate Accreted Value of Notes surrendered by
Holders exceeds the Offer Amount, the Issuers shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuers so that only Notes in denominations of $1,000
principal amount at maturity, or integral multiples thereof, shall be
purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount at maturity to the unpurchased
portion of the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Issuers shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer or
if less than the Offer Amount has been tendered, all Notes tendered, and shall
deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for
51
payment by the Issuers in accordance with the terms of this Section 3.09. The
Issuers, the Depositary or the Paying Agent, as the case may be, shall promptly
(but in any case not later than five days after the Purchase Date) mail or
deliver to each tendering Holder an amount equal to the purchase price of the
Notes tendered by such Holder and accepted by the Issuers for purchase, and the
Issuers shall promptly issue a new Note, and the Trustee, upon written request
from the Issuers, shall authenticate and mail or deliver such new Note to such
Holder, in a principal amount at maturity equal to any unpurchased portion of
the Note surrendered. Any Note not so accepted shall be promptly mailed or
delivered by the Issuers to the Holder thereof. The Issuers shall publicly
announce the results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
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The Issuers shall pay or cause to be paid the Accreted Value of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes. Accreted Value, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Issuers
or a Subsidiary thereof, holds as of 10:00 a.m. New York City time on the due
date money deposited by the Issuers in immediately available funds and
designated for and sufficient to pay all Accreted Value, premium, if any, and
interest then due. The Issuers shall pay all Special Interest, if any, in the
same manner on the dates and in the amounts set forth in the Registration Rights
Agreement.
The Issuers shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; they shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02. Maintenance of Office or Agency.
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The Issuers shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
redemption, repurchase, registration of transfer or for exchange and where
notices and demands to or upon the
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Issuers in respect of the Notes and this Indenture may be served. The Issuers
shall give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Issuers shall
fail to maintain any such required office or agency or shall fail to furnish
the Trustee with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the Corporate Trust Office of the Trustee.
The Issuers may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Issuers of their obligation to maintain an office or agency in the Borough of
Manhattan, The City of New York for such purposes. The Issuers shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Issuers hereby designate The Bank of New York, an affiliate of the
Trustee, at 101 Barclay Street, New York, New York 10286 as one such office or
agency of the Issuers in accordance with Section 2.03.
Section 4.03. Reports.
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Whether or not required by the Commission, so long as any Notes are
outstanding, the Issuers shall furnish to the Holders of Notes, within the time
periods specified in the Commission's rules and regulations:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q
and 10-K if the Issuers were required to file such Forms, including a
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" section and, with respect to the annual information only,
a report on the annual financial statements by the Company's certified
independent accountants; and
(2) all current reports that would be required to be filed
with the Commission on Form 8-K if the Issuers were required to file
such reports.
If the Issuers have designated any of their Subsidiaries as Unrestricted
Subsidiaries, then the quarterly and annual financial information required by
the preceding paragraph shall include a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes thereto, and in
Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations of the Company
and its Restricted Subsidiaries separate from the
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financial condition and results of operations of the Unrestricted Subsidiaries
of the Company.
In addition, whether or not required by the Commission, the Issuers
shall file a copy of all of the information and reports referred to in clauses
(1) and (2) above with the Commission for public availability within the time
periods specified in the Commission's rules and regulations, unless the
Commission will not accept such a filing, and make such information available to
securities analysts and prospective investors upon request.
Section 4.04 Compliance Certificate.
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(a) The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year have been made under the supervision of the signing Officers with a view
to determining whether the Company has kept, observed, performed and fulfilled
its obligations under this Indenture, and further stating, as to each such
Officer signing such certificate, that to the best of his or her knowledge the
Company has kept, observed, performed and fulfilled each and every covenant
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions of this Indenture
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03 above shall be accompanied by a
written statement of the Company's independent public accountants (each of whom
shall be a firm of established national reputation) that in making the
examination necessary for certification of such financial statements, nothing
has come to their attention that would lead them to believe that the Company has
violated any provisions of Article 4 or Article 5 or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation. In the
event that, after the Company has used its reasonable best efforts to obtain the
written statement of the Company's independent public accountants required by
the provisions of this paragraph, such statement cannot be obtained, the Company
shall deliver, in satisfaction of its obligations under this Section 4.04, an
Officers' Certificate (A) certifying that it has used its reasonable best
efforts to obtain such required statement but was unable to do so and
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(B) attaching the written statement of the Company's accountants that the
Company received in lieu thereof.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company is taking or proposes to take with
respect thereto.
Section 4.05. Taxes.
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The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws.
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Each of the Issuers covenants (to the extent that it may lawfully do so)
that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this Indenture; and each of the Issuers (to the
extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.
Section 4.07. Restricted Payments.
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The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted Subsidiaries'
Equity Interests (including, without limitation, any payment in connection with
any merger or consolidation involving the Company or any of its Restricted
Subsidiaries) or to the direct or indirect holders of the Company's or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other
than dividends or distributions payable (x) solely in Equity Interests (other
than Disqualified Stock) of the Company or (y) ,in the case of the Company and
its Restricted Subsidiaries, to the Company or a Restricted Subsidiary of the
Company);
(b) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the
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Company or any of its Restricted Subsidiaries) any Equity Interests of the
Company or any direct or indirect parent of the Company or any Restricted
Subsidiary of the Company (other than in the case of the Company and its
Restricted Subsidiaries, any such Equity Interests owned by the Company or any
Restricted Subsidiary of the Company); or
(c) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value, any Indebtedness that is
subordinated to the Notes, except a payment of interest or principal at the
Stated Maturity thereof,
(all such payments and other actions set forth in clauses (a) through (c) above
being collectively referred to as "Restricted Payments"), unless, at the time of
and after giving effect to such Restricted Payment:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(2) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable quarter period, have
been permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Leverage Ratio test set forth in the first paragraph of
Section 4.10; and
(3) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and each of
its Restricted Subsidiaries after March 17, 1999 (excluding Restricted
Payments permitted by clauses (2), (3), (4), (5), (6), (7) and (8) of
the next succeeding paragraph), shall not exceed, at the date of
determination, the sum of:
(a) an amount equal to 100% of the Consolidated EBITDA of
the Company since March 17, 1999 to the end of the Company's most
recently ended full fiscal quarter for which internal financial
statements are available, taken as a single accounting period,
less the product of 1.2 times the Consolidated Interest Expense
of the Company since March 17, 1999 to the end of the Company's
most recently ended full fiscal quarter for which internal
financial statements are available, taken as a single accounting
period, plus
(b) an amount equal to 100% of Capital Stock Sale
Proceeds less any such Capital Stock Sale Proceeds used in
connection with (i) an Investment made pursuant to clause (5) of
the definition of "Permitted Investments" or (ii) the incurrence
of Indebtedness pursuant to clause (10) of Section 4.10, plus
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(c) $100 million.
So long as no Default has occurred and is continuing or would be caused
thereby, the preceding provisions shall not prohibit:
(1) the payment of any dividend within 60 days after the date
of declaration thereof, if at said date of declaration such payment
would have complied with the provisions of this Indenture;
(2) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness of the Company in exchange
for, or out of the net proceeds of, the substantially concurrent sale
(other than to a Subsidiary of the Company) of Equity Interests of the
Company (other than Disqualified Stock); provided that the amount of any
such net cash proceeds that are utilized for any such redemption,
repurchase, retirement, defeasance or other acquisition shall be
excluded from clause (3) (b) of the preceding paragraph;
(3) the defeasance, redemption, repurchase or other
acquisition of subordinated Indebtedness of the Company or any of its
Restricted Subsidiaries with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;
(4) regardless of whether a Default then exists, the payment
of any dividend or distribution to the extent necessary to permit direct
or indirect beneficial owners of shares of Capital Stock of the Company
to pay federal, state or local income tax liabilities that would arise
solely from income of the Company or any of its Restricted Subsidiaries,
as the case may be, for the relevant taxable period and attributable to
them solely as a result of the Company (and any intermediate entity
through which the holder owns such shares) or any of its Restricted
Subsidiaries being a limited liability company, partnership or similar
entity for federal income tax purposes;
(5) regardless of whether a Default then exists, the payment
of any dividend by a Restricted Subsidiary of the Company to the holders
of its common Equity Interests on a pro rata basis;
(6) the payment of any dividend on the Helicon Preferred Stock
or the redemption, repurchase, retirement or other acquisition of the
Helicon Preferred Stock in an amount not in excess of its aggregate
liquidation value;
(7) the repurchase, redemption or other acquisition or
retirement for value, or the payment of any dividend or distribution to
the extent necessary to permit the repurchase, redemption or other
acquisition or retirement for value, of any Equity Interests of the
Company or a Parent held by any member of the
57
Company's or such Parent's management pursuant to any management equity
subscription agreement or membership or stock option agreement in effect
as of the Issue Date; provided that the aggregate price paid for all
such repurchased, redeemed, acquired or retired Equity Interests shall
not exceed $10 million in any fiscal year of the Company; and
(8) payment of fees in connection with any acquisition, merger
or similar transaction in an amount that does not exceed an amount equal
to 1.25% of the transaction value of such acquisition, merger or similar
transaction.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or any of its
Restricted Subsidiaries pursuant to the Restricted Payment. The fair market
value of any assets or securities that are required to be valued by this
covenant shall be determined by the Board of Directors of the Company, whose
resolution with respect thereto shall be delivered to the Trustee. Such Board of
Directors' determination must be based upon an opinion or appraisal issued by an
accounting, appraisal or investment banking firm of national standing if the
fair market value exceeds $100 million. Not later than the date of making any
Restricted Payment, the Company shall deliver to the Trustee an Officers'
Certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this Section 4.07 were
computed, together with a copy of any fairness opinion or appraisal required by
this Indenture.
Section 4.08. Investments.
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The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) make any Restricted Investment; or
(2) allow any Restricted Subsidiary of the Company to become an
Unrestricted Subsidiary,
unless, in each case:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(2) the Company would, at the time of, and after giving effect
to, such Restricted Investment or such designation of a Restricted
Subsidiary as an Unrestricted Subsidiary, have been permitted to incur
at least $1.00 of additional Indebtedness pursuant to the Leverage Ratio
test set forth in the first paragraph of Section 4.10.
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Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution of the Company giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by this Section 4.08.
If, at any time, any Unrestricted Subsidiary would fail to meet the requirements
as an Unrestricted Subsidiary described in the definition of "Unrestricted
Subsidiary," it shall thereafter cease to be an Unrestricted Subsidiary for
purposes of this Indenture and any Indebtedness of such Subsidiary shall be
deemed to be incurred by a Restricted Subsidiary of the Company as of such date
and, if such Indebtedness is not permitted to be incurred as of such date under
Section 4.10, the Company shall be in default. The Board of Directors of the
Company may at any time designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that such designation shall be deemed to be an incurrence
of Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if (1) such Indebtedness is permitted under Section 4.10 calculated on
a pro forma basis as if such designation had occurred at the beginning of the
Reference Period; and (2) no Default or Event of Default would be in existence
following such designation.
Section 4.09. Dividend and Other Payment Restrictions Affecting Subsidiaries.
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The Company shall not, directly or indirectly, create or permit to exist
or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Company to:
(1) pay dividends or make any other distributions on its
Capital Stock to the Company or any of its Restricted Subsidiaries, or
with respect to any other interest or participation in, or measured by,
its profits, or pay any Indebtedness owed to the Company or any of its
Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its
Restricted Subsidiaries; or
(3) transfer any of its properties or assets to the Company or
any of its Restricted Subsidiaries.
However, the preceding restrictions shall not apply to encumbrances or
restrictions existing under or by reason of:
(1) Existing Indebtedness as in effect on the Issue Date
(including, without limitation, the Credit Facilities) and any
amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings thereof, provided
that such amendments, modifications, restatements,
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renewals, increases, supplements, refundings, replacements or
refinancings are no more restrictive, taken as a whole, with respect to
such dividend and other payment restrictions than those contained in
such Existing Indebtedness, as in effect on the Issue Date;
(2) this Indenture, the Notes and the Other Notes;
(3) applicable law;
(4) any instrument governing Indebtedness or Capital Stock of
a Person acquired by the Company or any of its Restricted Subsidiaries
as in effect at the time of such acquisition (except to the extent such
Indebtedness was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the
Person, or the property or assets of the Person, so acquired; provided
that, in the case of Indebtedness, such Indebtedness was permitted by
the terms of this Indenture to be incurred;
(5) customary non-assignment provisions in leases entered into
in the ordinary course of business and consistent with past practices;
(6) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions on the property so
acquired of the nature described in clause (3) of the preceding
paragraph;
(7) any agreement for the sale or other disposition of a
Restricted Subsidiary of the Company that restricts distributions by
such Restricted Subsidiary pending its sale or other disposition;
(8) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole, than
those contained in the agreements governing the Indebtedness being
refinanced;
(9) Liens securing Indebtedness otherwise permitted to be
incurred under Section 4.14 that limit the right of the Company or any
of its Restricted Subsidiaries to dispose of the assets subject to such
Lien;
(10) provisions with respect to the disposition or distribution
of assets or property in joint venture agreements and other similar
agreements entered into in the ordinary course of business;
(11) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary course
of business;
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(12) restrictions contained in the terms of Indebtedness
permitted to be incurred under Section 4.10; provided that such
restrictions are no more restrictive than the terms contained in the
Credit Facilities as in effect on the Issue Date; and
(13) restrictions that are not materially more restrictive than
customary provisions in comparable financings and the management of the
Company determines that such restrictions will not materially impair the
Company's ability to make payments as required under the Notes.
Section 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock.
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The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Company shall not issue any Disqualified Stock and shall not
permit any of its Restricted Subsidiaries to issue any shares of Preferred Stock
unless the Leverage Ratio would have been not greater than 8.75 to 1.0
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom) as if the additional Indebtedness had been incurred, or the
Disqualified Stock had been issued, as the case may be, at the beginning of the
most recently ended fiscal quarter.
So long as no Default shall have occurred and be continuing or would be
caused thereby, the first paragraph of this covenant shall not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the incurrence by the Company and its Restricted
Subsidiaries of Indebtedness under the Credit Facilities; provided that
the aggregate principal amount of all Indebtedness of the Company and
its Restricted Subsidiaries outstanding under all Credit Facilities
after giving effect to such incurrence does not exceed an amount equal
to $3.5 billion less the aggregate amount of all Net Proceeds of Asset
Sales applied by the Company or any of its Subsidiaries in the case of
an Asset Sale since March 17, 1999 to repay Indebtedness under a Credit
Facility pursuant to Section 4.11;
(2) the incurrence by the Company and its Restricted
Subsidiaries of existing Indebtedness (other than the Credit
Facilities);
(3) the incurrence on the Issue Date by the Company and its
Restricted Subsidiaries of Indebtedness represented by the Notes and the
Other Notes;
(4) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case,
incurred for the purpose
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of financing all or any part of the purchase price or cost of
construction or improvement (including, without limitation, the cost of
design, development, construction, acquisition, transportation,
installation, improvement, and migration) of Productive Assets of the
Company or any of its Restricted Subsidiaries, in an aggregate
principal amount not to exceed $75 million at any time outstanding;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or
the net proceeds of which are used to refund, refinance or replace, in
whole or in part, Indebtedness (other than intercompany Indebtedness)
that was permitted by this Indenture to be incurred under the first
paragraph of this covenant or clauses (2) or (3) of this paragraph;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company
and any of its Wholly Owned Restricted Subsidiaries; provided that:
(a) if the Company is the obligor on such Indebtedness,
such Indebtedness must be expressly subordinated to the prior
payment in full in cash of all Obligations with respect to the
Notes; and
(b) (i) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than the Company or a Wholly Owned Restricted
Subsidiary thereof and (ii) any sale or other transfer of any
such Indebtedness to a Person that is not either the Company or a
Wholly Owned Restricted Subsidiary thereof, shall be deemed, in
each case, to constitute an incurrence of such Indebtedness by
the Company or any of its Restricted Subsidiaries that was not
permitted by this clause (6);
(7) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be
outstanding;
(8) the guarantee by the Company of Indebtedness of a
Restricted Subsidiary of the Company that was permitted to be incurred
by another provision of this Section 4.10;
(9) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount
at any time outstanding not to exceed $300 million;
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(10) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount
at any time outstanding not to exceed 200% of the net cash proceeds
received by the Company from the sale of its Equity Interests (other
than Disqualified Stock) after March 17, 1999 to the extent such net
cash proceeds have not been applied to make Restricted Payments or to
effect other transactions pursuant to Section 4.07 or to make Permitted
Investments pursuant to clause (5) of the definition thereof; and
(11) the accretion or amortization of original issue discount
and the write up of Indebtedness in accordance with purchase accounting.
For purposes of determining compliance with this Section 4.10, in the
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (1) through (11) above,
or is entitled to be incurred pursuant to the first paragraph of this covenant,
the Company shall be permitted to classify and from time to time to reclassify
such item of Indebtedness in any manner that complies with this covenant. For
avoidance of doubt, Indebtedness incurred pursuant to a single agreement,
instrument, program, facility or line of credit may be classified as
Indebtedness arising in part under one of the clauses listed above, and in part
under any one or more of the clauses listed above, to the extent that such
Indebtedness satisfies the criteria for such clauses.
Notwithstanding the foregoing, in no event shall any Restricted
Subsidiary of the Company consummate a Subordinated Debt Financing or a
Preferred Stock Financing. A "Subordinated Debt Financing" or a "Preferred Stock
Financing", as the case may be, with respect to any Restricted Subsidiary of the
Company shall mean a public offering or private placement (whether pursuant to
Rule 144A under the Securities Act or otherwise) of Subordinated Notes or
Preferred Stock (whether or not such Preferred Stock constitutes Disqualified
Stock), as the case may be, of such Restricted Subsidiary to one or more
purchasers (other than to one or more Affiliates of the Company). "Subordinated
Notes" with respect to any Restricted Subsidiary of the Company shall mean
Indebtedness of such Restricted Subsidiary that is contractually subordinated in
right of payment to any other Indebtedness of such Restricted Subsidiary
(including, without limitation, Indebtedness under the Credit Facilities). The
foregoing limitation shall not apply to (i) any Indebtedness or Preferred Stock
of any Person existing at the time such Person is merged with or into or became
a Subsidiary of the Company; provided that such Indebtedness or Preferred Stock
was not incurred or issued in connection with, or in contemplation of, such
Person merging with or into, or becoming a Subsidiary of, the Company and (ii)
any Indebtedness or Preferred Stock of a Restricted Subsidiary issued in
connection with, and as part of the consideration for, an acquisition, whether
by stock purchase, asset sale, merger or otherwise, in each case involving such
Restricted Subsidiary, which Indebtedness or Preferred Stock is issued to the
seller or sellers of such
63
stock or assets; provided that such Restricted Subsidiary is not obligated to
register such Indebtedness or Preferred Stock under the Securities Act or
obligated to provide information pursuant to Rule 144A under the Securities Act.
Section 4.11. Limitation on Asset Sales.
-------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company or a Restricted Subsidiary of the Company, as
the case may be, receives consideration at the time of such Asset Sale
at least equal to the fair market value of the assets or Equity
Interests issued or sold or otherwise disposed of;
(2) such fair market value is determined by the Company's
Board of Directors and evidenced by a resolution of such Board of
Directors set forth in an Officers' Certificate delivered to the
Trustee; and
(3) at least 75% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash, Cash
Equivalents or readily marketable securities.
For purposes of this Section 4.11, each of the following shall be deemed
to be cash:
(a) any liabilities (as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet) of the
Company or any Restricted Subsidiary of the Company (other
than contingent liabilities and liabilities that are by
their terms subordinated to the Notes) that are assumed by
the transferee of any such assets pursuant to a customary
novation agreement that releases the Company or such
Restricted Subsidiary from further liability;
(b) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary
from such transferee that are converted by the Company or
such Restricted Subsidiary into cash, Cash Equivalents or
readily marketable securities within 60 days after receipt
thereof (to the extent of the cash, Cash Equivalents or
readily marketable securities received in that
conversion); and
(c) Productive Assets.
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Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company or a Restricted Subsidiary of the Company, as the case may be,
may apply such Net Proceeds at its option:
(1) to repay debt under the Credit Facilities or any other
Indebtedness of the Restricted Subsidiaries of the Company (other than
Indebtedness represented by a guarantee of a Restricted Subsidiary of
the Company); or
(2) to invest in Productive Assets; provided that any Net
Proceeds which the Company or a Restricted Subsidiary of the Company,
as the case may be, has committed to invest in Productive Assets within
365 days of the applicable Asset Sale may be invested in Productive
Assets within two years of such Asset Sale.
The amount of any Net Proceeds received by the Company or a Restricted
Subsidiary of the Company from Asset Sales that are not applied or invested as
provided in the preceding paragraph shall constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $25 million, the Issuers shall make
an Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions requiring
offers to purchase or redeem with the proceeds of sales of assets to purchase
the maximum principal amount at maturity of Notes and such other pari passu
Indebtedness that may be purchased out of the Excess Proceeds (which amount
includes the entire amount of the Net Proceeds). The offer price in any Asset
Sale Offer shall be payable in cash and equal to 100% of the Accreted Value
thereof plus, after the Full Accretion Date, accrued and unpaid interest, if
any, to the date of purchase. If any Excess Proceeds remain after consummation
of an Asset Sale Offer, the Company or a Restricted Subsidiary of the Company
may use such Excess Proceeds for any purpose not otherwise prohibited by this
Indenture. If the aggregate Accreted Value of Notes and such other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
In the event that the Issuers shall be required to commence an offer to
Holders to purchase Notes pursuant to this Section 4.11, they shall follow the
procedures specified in Section 3.09.
Section 4.12. Sale and Leaseback Transactions.
-------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company may enter into a sale and leaseback transaction if:
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(1) the Company could have (a) incurred Indebtedness in an
amount equal to the Attributable Debt relating to such sale and
leaseback transaction under the Leverage Ratio test in the first
paragraph of Section 4.10 and (b) incurred a Lien to secure such
Indebtedness pursuant to Section 4.14; and
(2) the transfer of assets in that sale and leaseback
transaction is permitted by, and the Company applies the proceeds of
such transaction in compliance with Section 4.11.
The foregoing restrictions shall not apply to a sale and leaseback
transaction if the lease is for a period, including renewal rights, of not in
excess of three years.
Section 4.13. Transactions with Affiliates.
----------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each, an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(a) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate
consideration in excess of $15 million, a resolution of
the Board of Directors of the Company set forth in an
Officers' Certificate certifying that such Affiliate
Transaction complies with this Section 4.13 and that such
Affiliate Transaction has been approved by a majority of
the members of such Board of Directors; and
(b) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate
consideration in excess of $50 million, an opinion as to the
fairness to the Holders of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal
or investment banking firm of national standing.
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The following items shall not be deemed to be Affiliate Transactions
and, therefore, shall not be subject to the provisions of the prior paragraph:
(1) any existing employment agreement entered into by the
Company or any of its Subsidiaries and any employment agreement entered
into by the Company or any of its Restricted Subsidiaries in the
ordinary course of business and consistent with the past practice of
the Company or such Restricted Subsidiary;
(2) transactions between or among the Company and/or its
Restricted Subsidiaries;
(3) payment of reasonable directors fees to Persons who are
not otherwise Affiliates of the Company and customary indemnification
and insurance arrangements in favor of directors, regardless of
affiliation with the Company or any of its Restricted Subsidiaries;
(4) payment of management fees pursuant to management
agreements either (A) existing on the Issue Date or (B) entered into
after the Issue Date, to the extent that such management agreements
provide for percentage fees no higher than the percentage fees existing
under the management agreements existing on the Issue Date;
(5) Restricted Payments that are permitted by Section 4.07 and
Restricted Investments that are permitted by Section 4.08; and
(6) Permitted Investments.
Section 4.14. Liens.
-----
The Company shall not, directly or indirectly, create, incur, assume or
suffer to exist any Lien of any kind securing Indebtedness, Attributable Debt or
trade payables on any asset now owned or hereafter acquired, except Permitted
Liens.
Section 4.15. Existence.
---------
Subject to Article 5, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its limited
liability company existence, and the corporate, partnership or other existence
of each of its Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Subsidiary and (ii) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of its Subsidiaries
(other
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than Charter Capital), if the Board of Directors of the Company shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.16. Repurchase at the Option of Holders upon a Change of Control.
------------------------------------------------------------
If a Change of Control occurs, each Holder of Notes shall have the right
to require the Issuers to repurchase all or any part (equal to $1,000 principal
amount at maturity or an integral multiple thereof) of that Holder's Notes
pursuant to a Change of Control Offer. In the Change of Control Offer, the
Issuers shall offer (a "Change of Control Offer") a payment (the "Change of
Control Payment") in cash equal to 101% of the Accreted Value plus, for any
Change of Control Offer occurring after the Full Accretion Date, accrued and
unpaid interest thereon, if any, to the date of purchase.
Within ten days following any Change of Control, the Issuers shall mail
a notice to each Holder (with a copy to the Trustee) describing the transaction
or transactions that constitute the Change of Control and stating:
(a) the purchase price and the purchase date, which shall not exceed
30 Business Days from the date such notice is mailed (the "Change of Control
Payment Date");
(b) that any Note not tendered shall continue to accrete in value or
accrue interest;
(c) that, unless the Issuers default in the payment of the Change of
Control Payment, all Notes accepted for payment pursuant to the Change of
Control Offer shall cease to accrete in value or accrue interest after the
Change of Control Payment Date;
(d) that Holders electing to have any Notes purchased pursuant to a
Change of Control Offer shall be required to surrender the Notes, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Change of Control
Payment Date;
(e) that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount at maturity of Notes delivered for purchase, and a statement
that such Holder is withdrawing his election to have the Notes purchased; and
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(f) that Holders whose Notes are being purchased only in part shall
be issued new Notes equal in principal amount at maturity to the unpurchased
portion of the Notes surrendered, which unpurchased portion must be equal to
$1,000 in principal amount at maturity or an integral multiple thereof.
The Issuers shall comply with the requirements of Rule 14e-1 under the
Exchange Act (or any successor rules) and any other securities laws and
regulations thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of the Notes as a result of a Change of Control.
On the Change of Control Payment Date, the Issuers shall, to the extent
lawful:
(a) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer;
(b) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions thereof so tendered; and
(c) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the aggregate principal
amount at maturity of Notes or portions thereof being purchased by the Issuers.
The Paying Agent shall promptly pay to each Holder of Notes so tendered
the Change of Control Payment for such Notes, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a new Note equal in principal amount or principal amount at maturity, as
applicable, to any unpurchased portion of the Notes surrendered, if any;
provided that each such new Note shall be in a principal amount or principal
amount at maturity, as applicable, of $1,000 or an integral multiple thereof.
The Company shall publicly announce the results of the Change of Control Offer
on or as soon as practicable after the Change of Control Payment Date.
The provisions described above that require the Issuers to make a Change
of Control Offer following a Change of Control shall be applicable regardless of
whether or not any other provisions in this Indenture are applicable. Except as
described above with respect to a Change of Control, this Indenture does not
contain provisions that permit the Holders of the Notes to require that the
Issuers repurchase or redeem the Notes in the event of a takeover,
recapitalization or similar transaction.
Notwithstanding any other provision of this Section 4.16, the Issuers
shall not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in this Indenture
applicable to a Change of Control Offer made by the Issuers and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.
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Section 4.17. Limitations on Issuances of Guarantees of Indebtedness.
------------------------------------------------------
The Company shall not permit any of its Restricted Subsidiaries,
directly or indirectly, to Guarantee or pledge any assets to secure the payment
of any other Indebtedness of the Company except in respect of the Credit
Facilities (the "Guaranteed Indebtedness") unless (i) such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture providing for the
Guarantee (a "Subsidiary Guarantee") of the payment of the Notes by such
Restricted Subsidiary and (ii) until one year after all the Notes have been paid
in full in cash, such Restricted Subsidiary waives and will not in any manner
whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary of the Company as a result of any payment by
such Restricted Subsidiary under its Subsidiary Guarantee; provided that this
paragraph shall not be applicable to any Guarantee or any Restricted Subsidiary
that existed at the time such Person became a Restricted Subsidiary and was not
incurred in connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary. If the Guaranteed Indebtedness is subordinated to the
Notes, then the Guarantee of such Guaranteed Indebtedness shall be subordinated
to the Subsidiary Guarantee at least to the extent that the Guaranteed
Indebtedness is subordinated to the Notes.
Section 4.18. Payments for Consent.
--------------------
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration to or for the
benefit of any Holder of Notes for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid and is paid to all Holders of
the Notes that consent, waive or agree to amend in the time frame set forth in
the solicitation documents relating to such consent, waiver or agreement.
Section 4.19. Application of Fall-Away Covenants.
----------------------------------
During any period of time that (a) the Notes have Investment Grade
Ratings from both Rating Agencies and (b) no Default or Event of Default has
occurred and is continuing, the Company and its Restricted Subsidiaries shall
not be subject to the provisions of Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12,
4.13 and clause (4) of the first paragraph of Section 5.01 (collectively, the
"Suspended Covenants"). In the event that the Company and its Restricted
Subsidiaries are not subject to the Suspended Covenants for any period of time
as a result of the preceding sentence and, subsequently, one or both of the
Rating Agencies withdraws its ratings or downgrades the ratings assigned to the
Notes below the required Investment Grade Ratings or a Default or Event of
Default occurs and is continuing, then the Company and its Restricted
Subsidiaries shall thereafter again be subject to the Suspended Covenants and
compliance with the
70
Suspended Covenants with respect to the Restricted Payments made after the time
of such withdrawal, downgrade, Default or Event of Default will be calculated in
accordance with the terms of Section 4.07 as though such covenant had been in
effect during the entire period of time from the Issue
Date.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets.
----------------------------------------
Neither of the Issuers may, directly or indirectly: (1) consolidate or
merge with or into another Person (whether or not such Issuer is the surviving
corporation); or (2) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of its properties or assets, in one or more related
transactions, to another Person; unless:
(1) either: (a) such Issuer is the surviving corporation; or
(b) the Person formed by or surviving any such consolidation or merger
(if other than such Issuer) or to which such sale, assignment,
transfer, conveyance or other disposition shall have been made is a
Person organized or existing under the laws of the United States, any
state thereof or the District of Columbia (provided that if the Person
formed by or surviving any such consolidation or merger with either
Issuer is a limited liability company or a Person other than a
corporation, a corporate co-issuer shall also be an obligor with
respect to the Notes);
(2) the Person formed by or surviving any such consolidation
or merger (if other than the Company) or the Person to which such sale,
assignment, transfer, conveyance or other disposition shall have been
made assumes all the obligations of the Company under the Notes and this
Indenture pursuant to agreements reasonably satisfactory to the Trustee;
(3) immediately after such transaction no Default or Event of
Default exists; and
(4) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company) will, on the date of
such transaction after giving pro forma effect thereto and any related
financing transactions as if the same had occurred at the beginning of
the applicable four-quarter period, either (a) be permitted to incur at
least $1.00 of additional Indebtedness pursuant to the Leverage Ratio
test set forth in the first paragraph of Section 4.10 or (b) have a
Leverage Ratio immediately after giving effect to such consolidation or
merger no greater than the Leverage Ratio immediately prior to
71
such consolidation or merger.
In addition, the Company may not, directly or indirectly, lease all or
substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 shall not apply to a sale,
assignment, transfer, conveyance or other disposition of assets between or among
the Company and any of its Wholly Owned Subsidiaries.
Section 5.02. Successor Corporation Substituted.
---------------------------------
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of either Issuer in accordance with Section 5.01, the successor Person formed by
such consolidation or into which either Issuer is merged or to which such
transfer is made shall succeed to and (except in the case of a lease) be
substituted for, and may exercise every right and power of, such Issuer under
this Indenture with the same effect as if such successor Person had been named
therein as such Issuer, and (except in the case of a lease) such Issuer shall be
released from the obligations under the Notes and this Indenture, except with
respect to any obligations that arise from, or are related to, such transaction.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
-----------------
An "Event of Default" occurs if:
(a) the Issuers default in the payment when due of interest on the
Notes and such default continues for a period of 30 days;
(b) the Issuers default in payment when due of the Accreted Value of
or premium, if any, on the Notes;
(c) the Company or any of its Restricted Subsidiaries fails to comply
with any of the provisions of Sections 4.16 or 5.01;
(d) the Company or any of its Restricted Subsidiaries fails to comply
with any of their other covenants or agreements in this Indenture for 30 days
after written notice thereof has been given to the Company by the Trustee or to
the Company and the Trustee by Holders of at least 25% of the aggregate
principal amount at maturity of the Notes outstanding;
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(e) the Company or any of its Restricted Subsidiaries defaults under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed (or
the payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries) whether such Indebtedness or guarantee now exists or is created
after the Issue Date, if that default:
(1) is caused by a failure to pay at final stated maturity the
principal amount on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default
(a "Payment Default"); or
(2) results in the acceleration of such Indebtedness prior to
its express maturity,
and, in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more;
(f) the Company or any of its Restricted Subsidiaries fails to pay
final judgments which are non-appealable aggregating in excess of $100 million
(net of applicable insurance which has not been denied in writing by the
insurer), which judgments are not paid, discharged or stayed for a period of 60
days;
(g) the Company or any of its Significant Subsidiaries pursuant to or
within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in
an involuntary case,
(iii) consents to the appointment of a custodian of it or for all
or substantially all of its property, or
(iv) makes a general assignment for the benefit of its
creditors; or
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any of its Significant
Subsidiaries in an involuntary case;
73
(ii) appoints a custodian of the Company or any of its
Significant Subsidiaries or for all or substantially all of the
property of the Company or any of its Significant Subsidiaries; or
(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries;
and the order or decree remains unstayed and in effect for 60 consecutive days.
Section 6.02. Acceleration.
------------
In the case of an Event of Default arising from clause (g) or (h) of
Section 6.01 with respect to the Company, all outstanding Notes shall become due
and payable immediately without further action or notice. If any other Event of
Default occurs and is continuing, the Trustee by notice to the Issuers or the
Holders of at least 25% in aggregate principal amount at maturity of the then
outstanding Notes by notice to the Issuers and the Trustee may declare all the
Notes to be due and payable immediately in an amount equal to (x) the Accreted
Value of the Notes outstanding on the date of acceleration, if such declaration
is made prior to the Full Accretion Date or (y) the entire principal amount at
maturity of all the Notes outstanding on the date of acceleration plus accrued
interest, if any, to the date of acceleration, if such declaration is made after
the Full Accretion Date. The Holders of a majority in aggregate principal amount
at maturity of the Notes then outstanding by written notice to the Trustee may
on behalf of all of the Holders rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default (except nonpayment of Accreted Value, interest or
premium that has become due solely because of the acceleration) have been cured
or waived.
Section 6.03. Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of Accreted Value, premium, if any,
and interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
74
Section 6.04. Waiver of Existing Defaults.
---------------------------
Holders of not less than a majority in aggregate principal amount at
maturity of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the Accreted Value of, premium, if any, or interest on, the
Notes (including in connection with an offer to purchase) (provided, however,
that the Holders of a majority in aggregate principal amount at maturity of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
Section 6.05. Control by Majority.
-------------------
Holders of a majority in principal amount at maturity of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be prejudicial to the rights of other Holders of Notes or that may involve
the Trustee in personal liability. The Trustee may take any other action which
it deems proper that is not inconsistent with any such directive.
Section 6.06. Limitation on Suits.
-------------------
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal amount at
maturity of the then outstanding Notes make a written request to the Trustee to
pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
75
(e) during such 60-day period the Holders of a majority in aggregate
principal amount at maturity of the then outstanding Notes do not give the
Trustee a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment.
---------------------------------------------
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of Accreted Value, premium, if any, and
interest on the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
Section 6.08. Collection Suit by Trustee.
--------------------------
If an Event of Default specified in Section 6.01(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Issuers for the whole amount of Accreted
Value of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue Accreted Value and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
--------------------------------
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Issuers
(or any other obligor upon the Notes), their creditors or their property and
shall be entitled and empowered to collect, receive and distribute any money or
other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 out of the
estate in any such proceeding, shall be denied for any reason,
76
payment of the same shall be secured by a Lien on, and shall be paid out of, any
and alldistributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 6.10. Priorities.
----------
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes for
Accreted Value, premium, if any, and interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for Accreted Value, premium, if any and interest,
respectively; and
Third: to the Issuers or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07, or a suit by Holders of more than 10%
in aggregate principal amount at maturity of the then outstanding Notes.
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ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
required to be furnished to the Trustee hereunder and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture (but need not confirm or investigate
the accuracy of any mathematical calculations or other facts stated
therein).
(c) The Trustee may not be relieved from liabilities for its own
gross negligent action, its own gross negligent failure to act, or its own
willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts;
and
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
78
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be under
no obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability, claim,
damage or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuers.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or documents.
Section 7.02 Rights of Trustee.
-----------------
(a) The Trustee may conclusively rely upon any document (whether in
its original or facsimile form) believed by it to be genuine and to have been
signed or presented by the proper Person. The Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its own selection and the written advice or opinion of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from either of the Issuers shall be
sufficient if signed by an Officer of such Issuer.
79
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it against the costs, expenses
and liabilities that might be incurred by it in compliance with such request or
direction.
(g) The Trustee shall not be charged with knowledge of any Default or
Event of Default unless either (i) a Responsible Officer of the Trustee shall
have actual knowledge of such Default or Event of Default or (ii) written notice
of such Default or Event of Default shall have been given to and received by a
Responsible Officer of the Trustee by the Issuers or any Holder.
Section 7.03. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Issuers or any Affiliate of
the Issuers with the same rights it would have if it were not Trustee. However,
in the event that the Trustee acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue as trustee or resign. Any Agent may do the same with like rights and
duties. The Trustee is also subject to Sections 7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
--------------------
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuers' use of the proceeds from the Notes or any money
paid to the Issuers or upon the Issuers' direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
------------------
If a Default or Event of Default occurs and is continuing and if it is
known to a Responsible Officer of the Trustee, the Trustee shall mail to Holders
of Notes a notice of the Default or Event of Default within 90 days after the
Trustee acquires knowledge thereof. Except in the case of a Default or Event of
Default in payment of Accreted Value of, premium, if any, or interest on any
Note, the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders of the Notes.
80
Section 7.06. Reports by Trustee to Holders of the Notes.
------------------------------------------
Within 60 days after each May 15 beginning with the May 15 following the
date of this Indenture, and for so long as Notes remain outstanding, the Trustee
shall mail to the Holders of the Notes a brief report dated as of such reporting
date that complies with TIA ss. 313(a) (but if no event described in TIA ss.
313(a) has occurred within the twelve months preceding the reporting date, no
report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the SEC and each stock exchange on
which the Notes are listed in accordance with TIA ss. 313(d). The Issuers shall
promptly notify the Trustee when the Notes are listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
--------------------------
The Issuers shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuers shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Issuers shall, jointly and severally, indemnify the Trustee against
any and all losses, liabilities, claims, damages or expenses (including
reasonable legal fees and expenses) incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Issuers (including this Section 7.07) and defending itself against any claim
(whether asserted by the Issuers or any Holder or any other person) or liability
in connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such loss, liability or expense may be
attributable to its gross negligence or willful misconduct. The Trustee shall
notify the Issuers promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Issuers shall not relieve the Issuers of
their obligations hereunder. The Issuers shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Issuers shall pay the reasonable fees and expenses of such counsel. The Issuers
need not pay for any settlement made without their consent, which consent shall
not be unreasonably withheld.
The obligations of the Issuers this Section 7.07 shall survive
resignation or removal of the Trustee and the satisfaction and discharge of this
Indenture.
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To secure the Issuers' payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and interest on
particular Notes. Such Lien shall survive the resignation or removal of the
Trustee and the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) occurs, the expenses and the
compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to the
extent applicable.
Section 7.08. Replacement of Trustee.
----------------------
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Issuers. The Holders of a majority in
aggregate principal amount at maturity of the then outstanding Notes may remove
the Trustee by so notifying the Trustee and the Issuers in writing. The Issuers
may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuers shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in aggregate principal amount at maturity of the then outstanding
Notes may appoint a successor Trustee to replace the successor Trustee appointed
by the Issuers.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuers, or
the Holders of at least 10% in aggregate principal amount at maturity of the
then outstanding Notes may petition at the
82
expense of the Company any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee; provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07. Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Issuers' obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee.
Section 7.09. Successor Trustee by Merger, etc.
--------------------------------
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
Section 7.10. Eligibility; Disqualification.
-----------------------------
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss.310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
Section 7.11. Preferential Collection of Claims Against the Issuers.
-----------------------------------------------------
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
83
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.
--------------------------------------------------------
The Issuers may, at the option of their respective Boards of Directors
evidenced by a resolution set forth in an Officers' Certificate of each of the
Issuers, at any time, elect to have either Section 8.02 or 8.03 be applied to
all outstanding Notes upon compliance with the conditions set forth below in
this Article 8.
Section 8.02. Legal Defeasance and Discharge.
------------------------------
Upon the Issuers' exercise under Section 8.01 of the option applicable
to this Section 8.02, the Issuers shall, subject to the satisfaction of the
conditions set forth in Section 8.04, be deemed to have been discharged from
their obligations with respect to all outstanding Notes on the date the
conditions set forth below are satisfied (hereinafter, "Legal Defeasance"). For
this purpose, Legal Defeasance means that the Issuers shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Notes, which shall thereafter be deemed to be "outstanding" only for the
purposes of Section 8.05 and the other Sections of this Indenture referred to in
(a) and (b) below, and to have satisfied all their other obligations under such
Notes and this Indenture (and the Trustee, on demand of and at the expense of
the Issuers, shall execute proper instruments acknowledging the same), except
for the following provisions which shall survive until otherwise terminated or
discharged hereunder:
(a) the rights of Holders of outstanding Notes to receive payments in
respect of the Accreted Value or principal of, premium, if any, and interest on
such Notes when such payments are due from the trust referred to below;
(b) the Issuers' obligations with respect to the Notes concerning
issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or
stolen Notes and the maintenance of an office or agency for payment and money
for security payments held in trust;
(c) the rights, powers, trusts, duties and immunities of the Trustee
and the Issuers' obligations in connection therewith; and
(d) the Legal Defeasance provisions of this Indenture;
Subject to compliance with this Article 8, the Issuers may exercise
their option under this Section 8.02 notwithstanding the prior exercise of their
option under Section 8.03.
84
Section 8.03. Covenant Defeasance.
-------------------
Upon the Issuers' exercise under Section 8.01 of the option applicable
to this Section 8.03, the Issuers shall, subject to the satisfaction of the
conditions set forth in Section 8.04, be released from their obligations under
the covenants contained in Article 5 and Sections 4.03, 4.07, 4.08, 4.09, 4.10,
4.11, 4.12, 4.13, 4.14, 4.16, 4.17 and 4.19 with respect to the outstanding
Notes on and after the date the conditions set forth in Section 8.04 are
satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall thereafter
be deemed not "outstanding" for the purposes of any direction, waiver, consent
or declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes, the Issuers may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01, but, except as specified above, the
remainder of this Indenture and such Notes shall be unaffected thereby. In
addition, upon the Issuers' exercise under Section 8.01 of the option applicable
to this Section 8.03, subject to the satisfaction of the conditions set forth in
Section 8.04, Sections 6.01(c) through 6.01(f) shall not constitute Events of
Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
------------------------------------------
The following shall be the conditions to the application of either
Section 8.02 or 8.03 to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(1) the Company must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders of the Notes, cash in U.S.
dollars, non-callable Government Securities, or a combination thereof,
in such amounts as will be sufficient, in the opinion of a nationally
recognized firm of independent public accountants, to pay the principal
of, premium, if any, and interest on the outstanding Notes on the
stated maturity or on the applicable redemption date, as the case may
be, and the Company must specify whether the Notes are being defeased
to maturity or to a particular redemption date;
(2) in the case of Legal Defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel reasonably acceptable to
the Trustee confirming that (a) the Company has received from, or there
has been published
85
by, the Internal Revenue Service a ruling or (b) since the Issue Date,
there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such opinion of
counsel shall confirm that, the Holders of the outstanding Notes will
not recognize income, gain or loss for federal income tax purposes as a
result of such Legal Defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred;
(3) in the case of Covenant Defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel reasonably acceptable to
the Trustee confirming that the Holders of the outstanding Notes will
not recognize income, gain or loss for federal income tax purposes as a
result of such Covenant Defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(4) no Default or Event of Default shall have occurred and be
continuing either: (a) on the date of such deposit (other than a Default
or Event of Default resulting from the borrowing of funds to be applied
to such deposit); or (b) or insofar as Events of Default from bankruptcy
or insolvency events are concerned, at any time in the period ending on
the 91st day after the date of deposit;
(5) such Legal Defeasance or Covenant Defeasance will not
result in a breach or violation of, or constitute a default under any
material agreement or instrument (other than this Indenture) to which
the Company or any of its Restricted Subsidiaries is a party or by which
the Company or any of its Restricted Subsidiaries is bound;
(6) the Company must have delivered to the Trustee an opinion
of counsel to the effect that after the 91st day assuming no intervening
bankruptcy, that no Holder is an insider of either of the Issuers
following the deposit and that such deposit would not be deemed by a
court of competent jurisdiction a transfer for the benefit of either
Issuer in its capacity as such, the trust funds will not be subject to
the effect of any applicable bankruptcy, insolvency, reorganization or
similar laws affecting creditors' rights generally;
(7) the Company must deliver to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders of Notes over the other creditors
of the Company with the intent of defeating, hindering, delaying or
defrauding creditors of the Company or others; and
86
(8) the Company must deliver to the Trustee an Officers'
Certificate and an opinion of counsel, each stating that all conditions
precedent relating to the Legal Defeasance or the Covenant Defeasance
have been complied with.
Notwithstanding the foregoing, the opinion of counsel required by clause
(2) above with respect to a Legal Defeasance need not be delivered if all Notes
not theretofore delivered to the Trustee for cancellation (i) have become due
and payable or (ii) will become due and payable on the maturity date within one
year, by their terms or under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense,
of the Issuers.
Section 8.05. Deposited Money and Government Securities to Be Held in Trust;
Other Miscellaneous Provisions.
- ----------------------------------------------------------------------------
Subject to Section 8.06, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 in respect of the outstanding Notes shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Issuers acting as Paying Agent) as the Trustee may
determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal, premium, if any, and interest, but such money
need not be segregated from other funds except to the extent required by law.
The Issuers shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Issuers from time to time upon the request of the
Issuers any money or non-callable Government Securities held by it as provided
in Section 8.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a)), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. Repayment to Issuers.
--------------------
Any money deposited with the Trustee or any Paying Agent, or then held
by the Issuers, in trust for the payment of the Accreted Value of, premium, if
any, or interest on
87
any Note and remaining unclaimed for two years after such principal, and
premium, if any, or interest has become due and payable shall be paid to the
Issuers on their request or (if then held by the Issuers) shall be discharged
from such trust; and the Holder of such Note shall thereafter look only to the
Issuers for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Issuers as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Issuers cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Issuers.
Section 8.07. Reinstatement.
-------------
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers' obligations under this Indenture and the Notes,
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 until such time as the Trustee or Paying Agent is permitted
to apply all such money in accordance with Section 8.02 or 8.03, as the case may
be; provided, however, that, if the Issuers make any payment of Accreted Value
of, premium, if any, or interest on any Note following the reinstatement of
their obligations, the Issuers shall be subrogated to the rights of the Holders
of such Notes to receive such payment from the money held by the Trustee or
Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
-----------------------------------
Notwithstanding Section 9.02 of this Indenture, the Issuers and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
88
(c) to provide for the assumption of either Issuer's obligations to
Holders of Notes in the case of a merger or consolidation or sale of all or
substantially all of the assets of such Issuer pursuant to Article 5;
(d) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under this Indenture of any Holder; or
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA or otherwise as
necessary to comply with applicable law.
Upon the request of the Issuers accompanied by a resolution of their
respective Boards of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02, the Trustee shall join with the Issuers in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes.
--------------------------------
Except as provided below in this Section 9.02, this Indenture (including
Sections 4.11 and 4.16) or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in aggregate principal amount at
maturity of the Notes then outstanding (including, without limitation, consents
obtained in connection with a purchase of, or a tender offer or exchange offer
for, Notes) and, subject to Sections 6.04 and 6.07, any existing Default or
compliance with any provision of this Indenture or the Notes may be waived with
the consent of the Holders of a majority in aggregate principal amount at
maturity of the Notes then outstanding (including, without limitation, consents
obtained in connection with a purchase of, or a tender offer or exchange offer
for, Notes). Section 2.08 shall determine which Notes are considered to be
"outstanding" for purposes of this Section 9.02.
Upon the request of the Issuers accompanied by a resolution of their
respective Boards of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02, the
Trustee shall join with the Issuers in the execution of such amended or
supplemental Indenture unless such amended or supplemental Indenture directly
affects the Trustee's own rights, duties or immunities
89
under this Indenture or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07, the Holders of a
majority in aggregate principal amount at maturity of the Notes then outstanding
may waive compliance in a particular instance by the Issuers with any provision
of this Indenture or the Notes. However, without the consent of each Holder
affected, an amendment, supplement or waiver under this Section 9.02 may not
(with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount at maturity of Notes whose Holders
must consent to an amendment, supplement or waiver;
(b) reduce the Accreted Value of or change the fixed maturity of any
Note or alter the payment provisions with respect to the redemption of the Notes
(other than provisions relating to Sections 4.11 and 4.16);
(c) reduce the rate of or extend the time for payment of interest on
any Note;
(d) waive a Default or Event of Default in the payment of Accreted
Value of, or premium, if any, or interest on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount at maturity of the Notes and a waiver of the payment default
that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of Accreted Value of, or premium, if any, or interest on the Notes;
(g) waive a redemption payment with respect to any Note (other than
a payment required by Sections 4.11 and 4.16); or
(h) make any change in this Section 9.02.
90
Section 9.03. Compliance with Trust Indenture Act.
-----------------------------------
Every amendment or supplement to this Indenture or the Notes shall be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04. Revocation and Effect of Consents.
---------------------------------
Until an amendment, supplement or waiver becomes effective, a consent to
it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes.
--------------------------------
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Issuers in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
-------------------------------
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Issuers
may not sign an amendment or supplemental Indenture until their respective
Boards of Directors approve it. In executing any amended or supplemental
indenture, the Trustee shall be entitled to receive and (subject to Section
7.01) shall be fully protected in relying upon, in addition to the documents
required by Section 10.04, an Officer's Certificate and an Opinion of Counsel,
in each case from each of the Issuers, stating that the execution of such
amended or supplemental indenture is authorized or permitted by this Indenture.
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ARTICLE 10
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA ss. 318(c), the imposed duties shall control.
Section 10.02. Notices.
-------
Any notice or communication by the Issuers or the Trustee to the others
is duly given if in writing and delivered in Person or mailed by first class
mail (registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Issuers:
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
Telecopier No.: (314) 965-8793
Attention: Secretary
With a copy to:
Paul, Hastings, Janofsky & Walker LLP Irell & Manella
399 Park Avenue 1800 Avenue of the Stars
31st Floor Suite 900
New York, New York 10022 Los Angeles, California 90067
Telecopier No.: (212) 319-4090 Telecopier No.: (310) 556-5393
Attention: Leigh P. Ryan, Esq. Attention: Meredith Jackson, Esq.
If to the Trustee:
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
92
The Issuers or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA ss. 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Issuers mail a notice or communication to Holders, it shall mail
a copy to the Trustee and each Agent at the same time.
Section 10.03. Communication by Holders of Notes with Other Holders of Notes.
-------------------------------------------------------------
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Issuers, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss. 312
(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Issuers to the Trustee to take
any action under this Indenture, the Issuers shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.05) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
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Section 10.05. Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA ss.
314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read suchcovenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 10.06. Rules by Trustee and Agents.
---------------------------
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. No Personal Liability of Directors, Officers, Employees, Members
and Stockholders.
- --------------------------------------------------------------------------------
No director, officer, employee, incorporator, member or stockholder of
the Issuers, as such, shall have any liability for any obligations of the
Issuers under the Notes, this Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
Section 10.08. Governing Law.
-------------
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES AND ANY SUBSIDIARY GUARANTEE WITHOUT
GIVING EFFECT TO THE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT
THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE
COURTS
94
OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS INDENTURE OR THE NOTES OR ANY SUBSIDIARY GUARANTEE.
Section 10.09. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Issuers or their Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10.10. Successors.
----------
All agreements of the Issuers in this Indenture and the Notes, as the
case may be, shall bind their respective successors. All agreements of the
Trustee in this Indenture shall bind its successors.
Section 10.11. Severability.
------------
In case any provision in this Indenture or the Notes, as the case may
be, shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 10.12. Counterpart Originals.
---------------------
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 10.13. Table of Contents, Headings, etc.
--------------------------------
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions.
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Notes herein
expressly provided for), and the
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Trustee, on demand of and at the expense of the Issuers, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered
(other than (i) Notes which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 2.07
and (ii) Notes for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Issuers
and thereafter repaid to the Issuers or discharged from such
trust,) have been delivered to the Trustee for cancellation; or
(B) all such Notes not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one
year under arrangements satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the
name, and at the expense, of the Issuers,
and the Issuers, in the case of (i), (ii) or (iii) above, have
deposited or caused to be deposited with the Trustee as trust
funds in trust for the purpose an amount sufficient to pay and
discharge the entire indebtedness on such Notes not theretofore
delivered to the Trustee for cancellation, for principal (and
premium, if any) and interest to the date of such deposit (in the
case of Notes which have become due and payable) or to the
maturity or redemption thereof, as the case may be;
(2) the Issuers have paid or caused to be paid all other sums
payable hereunder by the Issuers; and
(3) each of the Issuers have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture pursuant to
this Article 11, the obligations of the Issuers to the Trustee under Section
7.07, and, if money shall
96
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 11.02 shall survive.
Section 11.02. Application of Trust Money.
--------------------------
All money deposited with the Trustee pursuant to Section 11.01 shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Paying Agent
as the Trustee may determine, to the Persons entitled thereto, of the principal
(and premium, if any) and interest for whose payment such money has been
deposited with the Trustee.
[Signatures on following page]
97
SIGNATURES
Dated as of May 15, 2001
CHARTER COMMUNICATIONS HOLDINGS, LLC, as
an Issuer
By:/s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION,
as an Issuer
By:/s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
BNY MIDWEST TRUST COMPANY,
as Trustee
By:/s/ D.G. DONOVAN
---------------------------------
Name: D.G. Donovan
Title: Assistant Vice President
98
EXHIBIT A
[Face of Note]
CUSIP NO. [_______________]
11.750% Senior Discount Notes due 2011
No.
$[_______________]
CHARTER COMMUNICATIONS HOLDINGS, LLC
and
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
promise to pay to _________________________________________________________
or registered assigns,
the principal amount at maturity of __________________________________ Dollars
($______________________________) on May 15, 2011.
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
Subject to Restrictions set forth in this Note.
Dated: May 15, 2001
CHARTER COMMUNICATIONS HOLDINGS, LLC
By_____________________________________
Name:
Title:
By_____________________________________
Name:
Title:
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CHARTER COMMUNICATIONS HOLDINGS CAPITAL
CORPORATION
By:_____________________________________
Name:
Title:
By:_____________________________________
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
BNY MIDWEST TRUST COMPANY,
as Trustee
By: __________________________________
Authorized Signatory
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[Back of Note]
11.750% Senior Discount Notes due 2011
FOR THE PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT;
FOR EACH $1,000 PRINCIPAL AMOUNT OF THIS SECURITY, THE ISSUE PRICE IS $565.02,
THE AMOUNT OF ORIGINAL ISSUE DISCOUNT IS $434.98, THE ISSUE DATE IS MAY 15, 2001
AND THE YIELD TO MATURITY IS 11.750% PER ANNUM.
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUERS."1
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE
903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT SUBJECT TO THE CERTIFICATION AND DELIVERY
REQUIREMENTS OF THE INDENTURE GOVERNING THE NOTES, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
_____________________________
1 This paragraph should be included only if the Note is issued in global
form.
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THEREUNDER (IF AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE STATES OF THE UNITED STATES."2
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Charter Communications Holdings, LLC, a Delaware limited
liability company (the "Company"), and Charter Communications Holdings Capital
Corporation, a Delaware corporation ("Charter Capital" and, together with the
Company, the "Issuers"), promise to pay interest on the principal amount at
maturity of this Note at the rate of 11.750% per annum. The interest rate on the
Notes is subject to increase pursuant to the provisions of the Registration
Rights Agreement. The Issuers will pay interest semi-annually in arrears on May
15 and November 15 of each year (each an "Interest Payment Date"), or if any
such day is not a Business Day, on the next succeeding Business Day commencing
on November 15, 2006. The principal amount at maturity of this Note will not
bear or accrue cash interest until May 15, 2006. Cash interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from May 15, 2006; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated between a
record date referred to on the face and the next succeeding Interest Payment
Date, interest shall accrue from such next succeeding Interest Payment Date. The
Issuers shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue Accreted Value and premium, if any, from
time to time on demand at a rate that is 1% per annum in excess of the rate then
in effect; they shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on demand at
the same rate to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. The Issuers shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the May 1 or November 1 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes will be payable as to
Accreted Value, premium, if any, and interest at the office or agency of the
Issuers maintained for such purpose within or without the City
_____________________________
2 This paragraph should be removed upon the exchange of Notes for
Exchange Notes in the Exchange Offer or upon the registration of the Notes
pursuant to the terms of the Registration Rights Agreement.
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and State of New York, or, at the option of the Issuers, payment of interest may
be made by check mailed to the Holders at their addresses set forth in the
register of Holders, and provided that payment by wire transfer of immediately
available funds will be required with respect to Accreted Value of and interest
and premium on all Global Notes and all other Notes the Holders of which shall
have provided wire transfer instructions to the Issuers or the Paying Agent.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
3. PAYING AGENT AND REGISTRAR. Initially, BNY Midwest Trust Company, the
Trustee under the Indenture, will act as Paying Agent and Registrar.
The Issuers may change any Paying Agent or Registrar without notice to any
Holder. The Company or any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Issuers issued the Notes under an Indenture dated as
of May 15, 2001 (the "Indenture") between the Issuers and the Trustee. The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code ss.ss. 77aaa-77bbbb). The Notes are subject to all such terms, and Holders
are referred to the Indenture and such Act for a statement of such terms. To the
extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The
Notes are obligations of the Issuers limited to $1,018,000,000 in aggregate
principal amount at maturity, of which all $1,018,000,000 in aggregate principal
amount at maturity of Notes were issued on the Issue Date.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Paragraph 5, the Issuers
shall not have the option to redeem the Notes prior to May 15, 2006. Thereafter,
the Issuers shall have the option to redeem the Notes, in whole or in part, upon
not less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount at maturity) set forth below plus
accrued and unpaid interest thereon, if any, to the applicable redemption date,
if redeemed during the twelve-month period beginning on May 15 of the years
indicated below:
Year Percentage
---- ----------
2006 105.875%
2007 103.917%
2008 101.958%
2009 and thereafter 100.000%
(b) Notwithstanding the provisions of clause (a) of this Paragraph 5, at
any time prior to May 15, 2004, the Issuers may on any one or more occasions
redeem up to
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35% of the aggregate principal amount at maturity of the Notes originally issued
under the Indenture on a pro rata basis (or as nearly pro rata as practicable),
at a redemption price of 111.750% of the Accreted Value thereof, plus, after the
Full Accretion Date, accrued and unpaid interest to the redemption date, with
the net cash proceeds of one or more Equity Offerings; provided that
(1) at least 65% of the aggregate principal amount at maturity of
Notes originally issued under the Indenture remains outstanding
immediately after the occurrence of such redemption (excluding Notes
held by the Company and its Subsidiaries); and
(2) the redemption must occur within 60 days of the date of the
closing of such Equity Offering.
6. MANDATORY REDEMPTION.
Except as otherwise provided in Paragraph 7 below, the Issuers shall not
be required to make mandatory redemption payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Issuers shall make an offer (a
"Change of Control Offer") to repurchase all or any part (equal to $1,000
principal amount at maturity or an integral multiple thereof) of each Holder's
Notes at a purchase price equal to 101% of the Accreted Value thereof plus, for
any Change of Control Offer occurring after the Full Accretion Date, accrued and
unpaid interest thereon, if any, to the date of purchase (the "Change of Control
Payment"). Within 10 days following any Change of Control, the Issuers shall
mail a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes on the Change
of Control Payment Date specified in such notice, pursuant to the procedures
required by the Indenture and described in such notice.
(b) If the Company or a Restricted Subsidiary consummates any Asset
Sale, when the aggregate amount of Excess Proceeds exceeds $25.0 million, the
Issuers shall commence an offer (an "Asset Sale Offer") pursuant to Section 4.11
of the Indenture to all Holders of Notes and all holders of other Indebtedness
that is pari passu with the Notes containing provisions requiring offers to
purchase or redeem with the proceeds of sales of assets to purchase the maximum
principal amount of Notes and such other pari passu Indebtedness that may be
purchased out of the Excess Proceeds (which amount includes the entire amount of
the Net Proceeds). The offer price in any Asset Sale Offer will be payable in
cash and equal to 100% of the Accreted Value thereof plus, after the Full
Accretion Date, accrued and unpaid interest, if any, to the date of purchase. If
any Excess Proceeds remain after consummation of an Asset Sale Offer, the
Company may
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use such Excess Proceeds for any purpose not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and such other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero. Holders of
Notes that are the subject of an offer to purchase will receive an Asset Sale
Offer from the Company prior to any related purchase date and may elect to have
such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed by first
class mail at least 30 days but not more than 60 days before the redemption date
to each Holder whose Notes are to be redeemed at its registered address. Notices
of redemption may not be conditional. No Notes of $1,000 principal amount at
maturity or less may be redeemed in part. Notes in denominations larger than
$1,000 principal amount at maturity may be redeemed in part but only in whole
multiples of $1,000 principal amount at maturity, unless all of the Notes held
by a Holder are to be redeemed. On and after the redemption date Accreted Value
ceases to accrete and interest ceases to accrue, as the case may be, on Notes or
portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 principal amount at maturity and
integral multiples of $1,000 principal amount at maturity. The transfer of Notes
may be registered and Notes may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Issuers may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Issuers need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Issuers need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the corresponding
Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount at maturity of the
Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, Notes),
and any existing default or compliance with any provision of the Indenture or
the Notes may be waived with the consent of the Holders of a majority in
aggregate principal amount at maturity of the
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Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, Notes).
Without the consent of any Holder of a Note, the Issuers and the Trustee may
amend or supplement the Indenture or the Notes to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place of
certificated Notes, to provide for the assumption of an Issuers' obligations to
Holders of Notes in the case of a merger or consolidation or sale of all or
substantially all of the assets of either Issuer to make any change that would
provide any additional rights or benefits to the Holders of Notes or that does
not adversely affect the legal rights under the Indenture of any such Holder, or
to comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA or otherwise as necessary to comply
with applicable law.
12. DEFAULTS AND REMEDIES. Each of the following is an Event of Default:
(i) default for 30 days in the payment when due of interest on the Notes, (ii)
default in payment when due of the Accreted Value of or premium, if any, on the
Notes, (iii) failure by the Company or any of its Restricted Subsidiaries to
comply with Sections 4.16 and 5.01 of the Indenture, (iv) failure by the Company
or any of its Restricted Subsidiaries for 30 days after written notice thereof
has been given to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% of the aggregate principal amount at maturity of
the Notes outstanding to comply with any of their other covenants or agreements
in the Indenture, (v) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries), whether such Indebtedness or guarantee now exists or
is created after the date of the Indenture, if that default: (a) is caused by a
failure to pay at final stated maturity the principal amount of such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (b) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$100 million or more, (vi) failure by the Company or any of its Restricted
Subsidiaries to pay final judgments which are non-appealable aggregating in
excess of $100 million (net of applicable insurance which has not been denied in
writing by the insurer), which judgments are not paid, discharged or stayed for
a period of 60 days or (vii) certain events of bankruptcy or insolvency with
respect to the Company or any of its Significant Subsidiaries. In the case of an
Event of Default arising from certain events of bankruptcy or insolvency with
respect to the Company, all outstanding Notes will become due and payable
without further action or notice. If any other Event of Default occurs and is
continuing, the Trustee by notice to the Issuers or the Holders of at least 25%
in aggregate principal amount at maturity of the then outstanding Notes by
notice to the Issuers and the Trustee may declare all the Notes to be due and
payable in an amount
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equal to (x) the Accreted Value of the Notes outstanding on the date of
acceleration, if such declaration is made prior to the Full Accretion Date or
(y) the entire principal amount at maturity of all the Notes outstanding on the
date of acceleration, plus accrued interest, if any, to the date of
acceleration, if such declaration is made after the Full Accretion Date. Holders
may not enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in aggregate principal
amount at maturity of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal or interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount at maturity of the Notes then outstanding
by notice to the Trustee may on behalf of the Holders of all of the Notes waive
any existing Default or Event of Default and its consequences under the
Indenture except a continuing Default or Event of Default in the payment of
interest on, or the Accreted Value of, the Notes. The Company is required to
deliver to the Trustee annually a statement regarding compliance with the
Indenture. Upon becoming aware of any Default or Event of Default, the Company
is required to deliver to the Trustee a statement specifying such Default or
Event of Default.
13. TRUSTEE DEALINGS WITH ISSUERS. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Issuers or their Affiliates, and may otherwise deal with the Issuers or
their Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator, member or stockholder of either of the Issuers, as such, shall not
have any liability for any obligations of the Issuers under the Notes or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
15. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS NOTE AND THE INDENTURE WITHOUT GIVING EFFECT
TO THE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. EACH
OF THE PARTIES HERETO AND THE HOLDERS AGREE TO SUBMIT TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS NOTE.
16. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
A-9
17. ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform
Gifts to Minors Act).
18. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Exchange and
Registration Rights Agreement dated as of May 15, 2001, among the Issuers and
the initial purchasers named therein (the "Registration Rights Agreement").
19. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Issuers have caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive
Suite 100
St. Louis, Missouri 63131
Attention: Secretary
Telecopier No.: (314) 965-0555
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: _________________________________
(Insert assignee's legal name)
________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________ to
transfer this Note on the books of the Issuers. The agent may substitute
another to act for him.
Date:______________________________
Your Signature: _____________________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:________________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuers pursuant
to Section 4.11 or 4.16 of the Indenture, check the appropriate box below:
|_| Section 4.11 |_| Section 4.16
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.11 or Section 4.16 of the Indenture, state the
amount you elect to have purchased:
$________________________
Date:____________________
Your Signature:__________________________________________________________
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.: ______________________________________________
Signature Guarantee*: ______________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-12
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or Definitive Note for an interest in this Global Note, have been
made:
Amount of Principal
decrease in Amount of Amount at
Principal increase in Maturity of
Amount at Principal this Global
Maturity of Amount at Note following Signature of authorized
Date of this Global Maturity of such decrease officer of Trustee or
Exchange Note this Global Note (or increase) Note Custodian
________ __________ _______________ ______________ _______________________
A-13
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 11.750% Senior Discount Notes due 2011
Reference is hereby made to the Indenture, dated as of May 15, 2001 (the
"Indenture"), among Charter Communications Holdings, LLC (the "Company") and
Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
___________________ (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount at maturity of $ _____________________________ in such Note[s]
or interests (the "Transfer"), to ___________________________ (the
"Transferee"), as further specified in Annex A hereto. In connection with the
Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. |_| Check if Transferee will take delivery of a beneficial interest
in the Rule 144A Global Note or a Definitive Note Pursuant to Rule 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the
B-1
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Rule 144A Global Note and/or the Definitive Note and in
the Indenture and the Securities Act.
2. |_| Check if Transferee will take delivery of a beneficial interest
in the Regulation S Global Note or a Definitive Note pursuant to Regulation S.
The Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and, accordingly, the Transferor hereby
further certifies that (i) the Transfer is not being made to a person in the
United States and (x) at the time the buy order was originated, the Transferee
was outside the United States or such Transferor and any Person acting on its
behalf reasonably believed and believes that the Transferee was outside the
United States or (y) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act and (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note and/or the Definitive
Note and in the Indenture and the Securities Act. If the Transfer of the
beneficial interest occurs prior to the expiration of the 40-day distribution
compliance period set forth in Regulation S, the transferred beneficial interest
will be held immediately thereafter through Euroclear or Clearstream.
3. |_| Check and complete if Transferee will take delivery of a
beneficial interest in a Definitive Note pursuant to any provision of the
Securities Act other than Rule 144A or Regulation S. The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial
interests in Restricted Global Notes and Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act and any applicable blue
sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) |_| such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act; or
(b) |_| such Transfer is being effected to the Company or a subsidiary
thereof; or
(c) |_| such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act; or
B-2
(d) |_| such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor
hereby further certifies that it has not engaged in any general solicitation
within the meaning of Regulation D under the Securities Act and the Transfer
complies with the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the requirements of
the exemption claimed, which certification is supported by (1) a certificate
executed by the Transferee in the form of Exhibit D to the Indenture and (2) an
Opinion of Counsel provided by the Transferor or the Transferee (a copy of which
the Transferor has attached to this certification), to the effect that such
Transfer is in compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Note and/or the Definitive Notes and in the Indenture and the Securities
Act.
4. |_| Check if Transferee will take delivery of a beneficial
interest in an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) |_| Check if Transfer is pursuant to Rule 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(b) |_| Check if Transfer is Pursuant to Regulation S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(c) |_| Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration
B-3
requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and
in compliance with the transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any State of the United States and (ii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will not be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuers.
__________________________________________
[Insert Name of Transferor]
By __________________________________________
Name:
Title:
Dated: ______________________________________
B-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) |_| a beneficial interest in the:
(i) |_| Rule 144A Global Note (CUSIP __________), or
(ii) |_| Regulation S Global Note (CUSIP _________), or
(b) |_| a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) |_| a beneficial interest in the:
(i) |_| Rule 144A Global Note (CUSIP __________), or
(ii) |_| Regulation S Global Note (CUSIP _________), or
(iii) |_| Unrestricted Global Note (CUSIP _________); or
(b) |_| a Restricted Definitive Note; or
(c) |_| an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-5
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No.: (312) 827-8542
Attention: Corporate Trust Department
Re: 11.750% Senior Discount Notes due 2011
(CUSIP ______________________)
Reference is hereby made to the Indenture, dated as of May 15, 2001 (the
"Indenture"), among Charter Communications Holdings, LLC (the "Company") and
Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
__________________________ (the "Owner") owns and proposes to exchange
the Note[s] or interest in such Note[s] specified herein, in the principal
amount at maturity of $____________________________ in such Note[s] or interests
(the "Exchange"). In connection with the Exchange, the Owner hereby certifies
that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests
in an Unrestricted Global Note
(a) |_| Check if Exchange is from beneficial interest in a Restricted
Global Note to beneficial interest in an Unrestricted Global Note. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the United States Securities Act of
1933, as amended (the "Securities Act"), (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the beneficial
interest in an Unrestricted
C-1
Global Note is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States. If the Exchange is from
beneficial interest in a Regulation S Global Note to beneficial interest in an
Unrestricted Global Note, the Owner further certifies that it is either (x) a
non-U.S. Person to whom Notes could be transferred in accordance with Regulation
S or (y) a U.S. Person who purchased Notes in a transaction that did not require
registration under the Securities Act.
(b) |_| Check if Exchange is from beneficial interest in a Restricted
Global Note to Unrestricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) |_| Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States. If the Exchange is from beneficial interest in a
Regulation S Global Note to an Unrestricted Definitive Note, the Owner further
certifies that it is either (x) a non-U.S. Person to whom Notes could be
transferred in accordance with Regulation S or (y) a U.S. Person who purchased
Notes in a transaction that did not required registration under the Securities
Act.
(d) |_| Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
C-2
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes
(a) |_| Check if Exchange is from beneficial interest in a Restricted
Global Note to Restricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. If the Exchange is from beneficial interest in a Regulation S
Global Note to a Restricted Definitive Note, the Owner further certifies that it
is either (x) a non-U.S. Person to whom Notes could be transferred in accordance
with Regulation S or (y) a U.S. Person who purchased Notes in a transaction that
did not require registration under the Securities Act. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the Restricted
Definitive Note issued will continue to be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Definitive Note and in the Indenture and the Securities Act.
(b) Check if Exchange is from Restricted Definitive Note to beneficial
interest in a Restricted Global Note. In connection with the Exchange of the
Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE]
|_| Rule 144A Global Note or |_| Regulation S Global Note with an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Issuers.
______________________________________________
[Insert Name of Transferor]
By __________________________________________
Name:
Title:
Dated: ______________________________________
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Charter Communications Holdings, LLC
Charter Communications Holdings Capital Corporation
c/o Charter Communications, Inc.
12444 Powerscourt Drive, Suite 100
St. Louis, Missouri 63131
BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Telecopier No. (312) 827-8542
Attention: Corporate Trust Department
Re: 11.750% Senior Discount Notes due 2011
Reference is hereby made to the Indenture, dated as of May 15, 2001 (the
"Indenture"), among Charter Communications Holdings, LLC (the "Company") and
Charter Communications Holdings Capital Corporation ("Charter Capital" and,
together with the Company, the "Issuers"), and BNY Midwest Trust Company, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount at maturity of:
(a) |_| a beneficial interest in a Global Note, or
(b) |_| a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any
D-1
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and an Opinion
of Counsel in form reasonably acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or beneficial
interest therein, we will be required to furnish to you and the Issuers such
certifications, legal opinions and other information as you and the Issuers may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Issuers are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy to any interested party
in any administrative or legal proceedings or official inquiry with respect to
the matters covered hereby.
______________________________________________
[Insert Name of Transferor]
By __________________________________________
Name:
Title:
Dated: ______________________________________
D-2
EXECUTION COPY
CHARTER COMMUNICATIONS HOLDINGS, LLC
and
CHARTER COMMUNICATIONS HOLDINGS
CAPITAL CORPORATION,
as Issuers
and
BNY MIDWEST TRUST COMPANY,
as Trustee
--------
INDENTURE
Dated as of May 15, 2001
--------
11.750% Senior Discount Notes Due 2011
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
310(a)(1)............................................. 7.10
(a)(2)................................................ 7.10
(a)(3)................................................ N.A.
(a)(4)................................................ N.A.
(a)(5)................................................ 7.10
(b)................................................... 7.10
(c)................................................... N.A.
311(a)................................................ 7.11
(b)................................................... 7.11
(c)................................................... N.A.
312(a)................................................ 2.05
(b)................................................... 10.03
(c)................................................... 10.03
313(a)................................................ 7.06
(b)(1)................................................ 10.03
(b)(2)................................................ 7.07; 10.03
(c)................................................... 7.06; 10.02
(d)................................................... 7.06
314(a)................................................ 4.03; 10.02
(b)................................................... 10.02
(c)(1)................................................ 10.04
(c)(2)................................................ 10.04
(c)(3)................................................ N.A.
(d)................................................... N.A.
(e)................................................... 10.05
(f)................................................... N.A.
315(a)................................................ 7.01
(b)................................................... 7.05; 10.02
(c)................................................... 7.01
(d)................................................... 7.01
(e)................................................... 6.11
316(a) (last sentence)................................ 2.09
(a)(1)(A)............................................. 6.05
(a)(1)(B)............................................. 6.04
(a)(2)................................................ N.A.
(b)................................................... 6.07
(c)................................................... 2.12
317(a)(1)............................................. 6.08
(a)(2)................................................ 6.09
(b)................................................... 2.04
318(a)................................................ 10.01
(b)................................................... N.A.
i
Trust Indenture Act Section Indenture Section
- --------------------------- -----------------
(c)................................................... 10.01
N.A. means Not Applicable.
* This Cross-Reference Table is not part of the Indenture.
ii
Table of Contents
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Page
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ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE.................................1
Section 1.01. Definitions................................................................1
Section 1.02. Other Definitions.........................................................25
Section 1.03. Incorporation by Reference of Trust Indenture Act.........................26
Section 1.04. Rules of Construction.....................................................26
ARTICLE 2 THE NOTES.................................................................27
Section 2.01. Form and Dating...........................................................27
Section 2.02. Execution and Authentication..............................................28
Section 2.03. Registrar and Paying Agent................................................29
Section 2.04. Paying Agent to Hold Money in Trust.......................................29
Section 2.05. Holder Lists..............................................................29
Section 2.06. Transfer and Exchange.....................................................30
Section 2.07. Replacement Notes.........................................................44
Section 2.08. Outstanding Notes.........................................................45
Section 2.09. Treasury Notes............................................................45
Section 2.10. Temporary Notes...........................................................46
Section 2.11. Cancellation..............................................................46
Section 2.12. Defaulted Interest........................................................46
ARTICLE 3 REDEMPTION AND PREPAYMENT.................................................47
Section 3.01. Notices to Trustee........................................................47
Section 3.02. Selection of Notes to Be Redeemed.........................................47
Section 3.03. Notice of Redemption......................................................47
Section 3.04. Effect of Notice of Redemption............................................48
Section 3.05. Deposit of Redemption Price...............................................48
Section 3.06. Notes Redeemed in Part....................................................49
Section 3.07. Optional Redemption.......................................................49
Section 3.08. Mandatory Redemption......................................................50
Section 3.09. Offer to Purchase by Application of Excess Proceeds.......................50
ARTICLE 4 COVENANTS.................................................................52
Section 4.01. Payment of Notes..........................................................52
Section 4.02. Maintenance of Office or Agency...........................................52
Section 4.03. Reports...................................................................53
Section 4.04. Compliance Certificate....................................................54
Section 4.05. Taxes.....................................................................55
Section 4.06. Stay, Extension and Usury Laws............................................55
Section 4.07. Restricted Payments.......................................................55
Section 4.08. Investments...............................................................58
Section 4.09. Dividend and Other Payment Restrictions Affecting Subsidiaries............59
Section 4.10. Incurrence of Indebtedness and Issuance of Preferred Stock................61
Section 4.11. Limitation on Asset Sales.................................................64
Section 4.12. Sale and Leaseback Transactions...........................................65
Section 4.13. Transactions with Affiliates..............................................66
Section 4.14. Liens.....................................................................67
Section 4.15. Existence.................................................................67
Section 4.16. Repurchase at the Option of Holders upon a Change of Control..............68
Section 4.17. Limitations on Issuances of Guarantees of Indebtedness....................70
Section 4.18. Payments for Consent......................................................70
Section 4.19. Application of Fall-Away Covenants........................................70
ARTICLE 5 SUCCESSORS................................................................71
Section 5.01. Merger, Consolidation, or Sale of Assets..................................71
Section 5.02. Successor Corporation Substituted.........................................72
ARTICLE 6 DEFAULTS AND REMEDIES.....................................................72
Section 6.01. Events of Default.........................................................72
Section 6.02. Acceleration..............................................................74
Section 6.03. Other Remedies............................................................74
Section 6.04. Waiver of Existing Defaults...............................................75
Section 6.05. Control by Majority.......................................................75
Section 6.06. Limitation on Suits.......................................................75
Section 6.07. Rights of Holders of Notes to Receive Payment.............................76
Section 6.08. Collection Suit by Trustee................................................76
Section 6.09. Trustee May File Proofs of Claim..........................................76
Section 6.10. Priorities................................................................77
Section 6.11. Undertaking for Costs.....................................................77
ARTICLE 7 TRUSTEE...................................................................78
Section 7.01. Duties of Trustee.........................................................78
Section 7.02. Rights of Trustee.........................................................79
Section 7.03. Individual Rights of Trustee..............................................80
Section 7.04. Trustee's Disclaimer......................................................80
Section 7.05. Notice of Defaults........................................................80
Section 7.06. Reports by Trustee to Holders of the Notes................................81
Section 7.07. Compensation and Indemnity................................................81
Section 7.08. Replacement of Trustee....................................................82
Section 7.09. Successor Trustee by Merger, etc..........................................83
Section 7.10. Eligibility; Disqualification.............................................83
Section 7.11. Preferential Collection of Claims Against the Issuers.....................83
ii
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE..................................84
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance..................84
Section 8.02. Legal Defeasance and Discharge............................................84
Section 8.03. Covenant Defeasance.......................................................85
Section 8.04. Conditions to Legal or Covenant Defeasance................................85
Section 8.05. Deposited Money and Government Securities to Be Held in Trust; Other
Miscellaneous Provisions..................................................87
Section 8.06. Repayment to Issuers......................................................87
Section 8.07. Reinstatement.............................................................88
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER..........................................88
Section 9.01. Without Consent of Holders of Notes.......................................88
Section 9.02. With Consent of Holders of Notes..........................................89
Section 9.03. Compliance with Trust Indenture Act.......................................91
Section 9.04. Revocation and Effect of Consents.........................................91
Section 9.05. Notation on or Exchange of Notes..........................................91
Section 9.06. Trustee to Sign Amendments, etc...........................................91
ARTICLE 10 MISCELLANEOUS.............................................................92
Section 10.01. Trust Indenture Act Controls..............................................92
Section 10.02. Notices...................................................................92
Section 10.03. Communication by Holders of Notes with Other Holders of Notes.............93
Section 10.04. Certificate and Opinion as to Conditions Precedent........................93
Section 10.05. Statements Required in Certificate or Opinion.............................94
Section 10.06. Rules by Trustee and Agents...............................................94
Section 10.07. No Personal Liability of Directors, Officers, Employees, Members and
Stockholders..............................................................94
Section 10.08. Governing Law.............................................................94
Section 10.09. No Adverse Interpretation of Other Agreements.............................95
Section 10.10. Successors................................................................95
Section 10.11. Severability..............................................................95
Section 10.12. Counterpart Originals.....................................................95
Section 10.13. Table of Contents, Headings, etc..........................................95
ARTICLE 11 SATISFACTION AND DISCHARGE................................................95
Section 11.01. Satisfaction and Discharge of Indenture...................................95
Section 11.02. Application of Trust Money................................................97
EXHIBIT A................................................................................A-1
EXHIBIT B................................................................................B-1
EXHIBIT C................................................................................C-1
EXHIBIT D................................................................................D-1
EXECUTION COPY
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
$1,018,000,000 11.750% Senior Discount Notes due 2011
Exchange and Registration Rights Agreement
May 15, 2001
Goldman, Sachs & Co.
Morgan Stanley & Co. Incorporated
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Salomon Smith Barney Inc.
JP Morgan, a Division of Chase Securities Inc.
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Nesbitt Burns Corp.
Dresdner Kleinwort Wasserstein Securities LLC
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Charter Communications Holdings, LLC, a Delaware limited liability
company (the "Company"), and Charter Communications Holdings Capital
Corporation, a Delaware corporation ("Charter Capital" and, together with the
Company, the "Issuers"), propose, subject to the terms and conditions stated
herein, to issue and sell to the Purchasers (as defined herein) upon the terms
set forth in the Purchase Agreement (as defined herein) their $1,018,000,000
aggregate principal amount at maturity of 11.750% Senior Discount Notes due 2011
(the "Notes"). As an inducement to the Purchasers to enter into the Purchase
Agreement and in satisfaction of a condition to the obligations of the
Purchasers thereunder, the Issuers agree with the Purchasers for the benefit of
holders (as defined herein) from time to time of the Registrable Securities (as
defined herein) as follows:
1. Certain Definitions. For purposes of this Exchange and Registration
Rights Agreement, the following terms shall have the following respective
meanings:
"Base Interest" shall mean the interest that would otherwise accrue on
the Notes under the terms thereof and the Indenture, without giving effect to
the provisions of this Exchange and Registration Rights Agreement.
The term "broker-dealer" shall mean any broker or dealer registered with
the Commission under the Exchange Act.
"Closing Date" shall mean the date on which the Notes are initially
issued.
"Commission" shall mean the United States Securities and Exchange
Commission, or any other federal agency at the time administering the Exchange
Act or the Securities Act, whichever is the relevant statute for the particular
purpose.
"Effective Time," in the case of (i) an Exchange Offer Registration,
shall mean the time and date as of which the Commission declares the Exchange
Offer Registration Statement effective or as of which the Exchange Offer
Registration Statement otherwise becomes effective and (ii) a Shelf
Registration, shall mean the time and date as of which the Commission declares
the Shelf Registration Statement effective or as of which the Shelf Registration
Statement otherwise becomes effective.
"Electing Holder" shall mean any holder of Registrable Securities that
has returned a completed and signed Notice and Questionnaire to the Issuers in
accordance with Section 3(d)(ii) or 3(d)(iii) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, or any
successor thereto, as the same shall be amended from time to time.
"Exchange Notes" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Exchange Offer" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Exchange Offer Registration" shall have the meaning assigned thereto in
Section 3(c) hereof.
"Exchange Offer Registration Statement" shall have the meaning assigned
thereto in Section 2(a) hereof.
The term "holder" shall mean each of the Purchasers and other persons
who acquire Registrable Securities from time to time (including any successors
or assigns), in each case for so long as such person is a registered holder of
any Registrable Securities.
2
"Indenture" shall mean the Indenture governing the Notes, dated as of
May 15, 2001 between the Issuers and BNY Midwest Trust Company, as Trustee, as
the same shall be amended from time to time.
"Notes" shall mean, collectively, the 11.750% Senior Discount Notes due
2011 of the Issuers to be issued and sold to the Purchasers, and Notes issued in
exchange therefor or in lieu thereof, pursuant to the Indenture.
"Notice and Questionnaire" means a Notice of Registration Statement and
Selling Securityholder Questionnaire substantially in the form of Exhibit A
hereto.
The term "person" shall mean a corporation, association, partnership,
organization, business, individual, government or political subdivision thereof
or governmental agency.
"Purchase Agreement" shall mean the Purchase Agreement, dated as of May
10, 2001, between the Purchasers and the Issuers relating to the Notes.
"Purchasers" shall mean the Purchasers named in Schedule I to the
Purchase Agreement.
"Registrable Securities" shall mean the Notes; provided, however, that a
Note shall cease to be a Registrable Security when (i) in the circumstances
contemplated by Section 2(a) hereof, such Note has been exchanged for an
Exchange Note in an Exchange Offer as contemplated in Section 2(a) hereof
(provided that any Exchange Note that, pursuant to the last two sentences of
Section 2(a), is included in a prospectus for use in connection with resales by
broker-dealers shall be deemed to be a Registrable Security with respect to
Sections 5, 6 and 9 hereof until resale of such Registrable Security has been
effected within the 180-day period referred to in Section 2(a)(y)); (ii) in the
circumstances contemplated by Section 2(b) hereof, a Shelf Registration
Statement registering such Note under the Securities Act has been declared or
becomes effective and such Note has been sold or otherwise transferred by the
holder thereof pursuant to and in a manner contemplated by such effective Shelf
Registration Statement; (iii) such Note is sold pursuant to Rule 144 under
circumstances in which any legend borne by such Note relating to restrictions on
transferability thereof, under the Securities Act or otherwise, is removed by
the Issuers or pursuant to the Indenture; (iv) such Security is eligible to be
sold pursuant to paragraph (k) of Rule 144; or (v) such Security shall cease to
be outstanding.
"Registration Default" shall have the meaning assigned thereto in
Section 2(c) hereof.
"Registration Expenses" shall have the meaning assigned thereto in
Section 4 hereof.
3
"Resale Period" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Restricted Holder" shall mean (i) a holder that is an affiliate of the
Issuers within the meaning of Rule 405, (ii) a holder who acquires Exchange
Notes outside the ordinary course of such holder's business, (iii) a holder who
has arrangements or understandings with any person to participate in the
Exchange Offer for the purpose of distributing Exchange Notes and (iv) a holder
that is a broker-dealer, but only with respect to Exchange Notes received by
such broker-dealer pursuant to an Exchange Offer in exchange for Registrable
Securities acquired by the broker-dealer directly from the Issuers.
"Rule 144," "Rule 405" and "Rule 415" shall mean, in each case, such
rule promulgated under the Securities Act (or any successor provision), as the
same shall be amended from time to time.
"Securities Act" shall mean the Securities Act of 1933, or any successor
thereto, as the same shall be amended from time to time.
"Shelf Registration" shall have the meaning assigned thereto in Section
2(b) hereof.
"Shelf Registration Statement" shall have the meaning assigned thereto
in Section 2(b) hereof.
"Special Interest" shall have the meaning assigned thereto in Section
2(c) hereof.
"subsidiaries" shall mean subsidiaries which would be "significant
subsidiaries" as defined in Rule 1-02(w) of Regulation S-X under the Exchange
Act.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, or any
successor thereto, and the rules, regulations and forms promulgated thereunder,
all as the same shall be amended from time to time.
Unless the context otherwise requires, any reference herein to a
"Section" or "clause" refers to a Section or clause, as the case may be, of this
Exchange and Registration Rights Agreement, and the words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Exchange and
Registration Rights Agreement as a whole and not to any particular Section or
other subdivision.
2. Registration Under the Securities Act.
(a) Except as set forth in Section 2(b) below, the Issuers agree to file
under the Securities Act, as soon as practicable, but no later than 120 days
after the Closing Date, a registration statement relating to an offer to
exchange (such registration
4
statement, the "Exchange Offer Registration Statement", and such offer, the
"Exchange Offer") any and all of the Notes for a like aggregate principal amount
of notes issued by the Issuers, which notes are substantially identical in all
material respects to the Notes (and are entitled to the benefits of a trust
indenture which has terms identical in all material respects to the Indenture or
is the Indenture and which has been qualified under the Trust Indenture Act),
except that they have been registered pursuant to an effective registration
statement under the Securities Act and do not contain provisions for the
additional interest contemplated in Section 2(c) below (such notes hereinafter
called "Exchange Notes"). The Issuers agree to use their reasonable best efforts
to cause the Exchange Offer Registration Statement to become or be declared
effective under the Securities Act as soon as practicable, but no later than 180
days after the Closing Date. The Exchange Offer will be registered under the
Securities Act on the appropriate form and will comply with all applicable
tender offer rules and regulations under the Exchange Act. The Issuers further
agree to use their reasonable best efforts to complete the Exchange Offer
promptly, but no later than 30 business days or longer, if required by the
federal securities laws, after such registration statement has become effective,
hold the Exchange Offer open for at least 30 days and exchange Exchange Notes
for all Registrable Securities that have been properly tendered and not
withdrawn on or prior to the expiration of the Exchange Offer. The Exchange
Offer will be deemed to have been "completed" only if the Exchange Notes
received by holders, other than Restricted Holders, in the Exchange Offer in
exchange for Registrable Securities are, upon receipt, transferable by each such
holder without restriction under the Securities Act and the Exchange Act and
without material restrictions under the blue sky or securities laws of a
substantial majority of the States of the United States of America. The Exchange
Offer shall be deemed to have been completed upon the earlier to occur of (i)
the Issuers having exchanged the Exchange Notes for all outstanding Registrable
Securities pursuant to the Exchange Offer and (ii) the Issuers having exchanged,
pursuant to the Exchange Offer, Exchange Notes for all Registrable Securities
that have been properly tendered and not withdrawn before the expiration of the
Exchange Offer, which shall be on a date that is at least 30 business days
following the commencement of the Exchange Offer. The Issuers agree (x) to
include in the Exchange Offer Registration Statement a prospectus for use in any
resales by any holder of Exchange Notes that is a broker-dealer and (y) to keep
such Exchange Offer Registration Statement effective for a period (the "Resale
Period") beginning when Exchange Notes are first issued in the Exchange Offer
and ending upon the earlier of the expiration of the 180th day after the
Exchange Offer has been completed or such time as such broker-dealers no longer
own any Registrable Securities. With respect to such Exchange Offer Registration
Statement, such holders shall have the benefit of the rights of indemnification
and contribution set forth in Sections 6(a), (c), (d) and (e) hereof.
(b) If (i) on or prior to the time the Exchange Offer is completed
existing law or Commission policy or interpretations are changed such that the
Exchange Notes received by holders, other than Restricted Holders, in the
Exchange Offer in exchange for
5
Registrable Securities are not or would not be, upon receipt, transferable by
each such holder without restriction under the Securities Act, (ii) the Exchange
Offer has not been completed within 210 days following the Closing Date or (iii)
the Exchange Offer is not available to any holder of the Notes, the Issuers
shall, in lieu of (or, in the case of clause (iii), in addition to) conducting
the Exchange Offer contemplated by Section 2(a), file under the Securities Act
on or prior to 30 business days after the time such obligation to file arises, a
"shelf" registration statement providing for the registration of, and the sale
on a continuous or delayed basis by the holders of, all of the Registrable
Securities, pursuant to Rule 415 or any similar rule that may be adopted by the
Commission (such filing, the "Shelf Registration" and such registration
statement, the "Shelf Registration Statement"). The Issuers agree to use their
reasonable best efforts (x) to cause the Shelf Registration Statement to become
or be declared effective by the Commission no later than 90 days after such
obligation to file arises and to keep such Shelf Registration Statement
continuously effective for a period ending on the earlier of (i) the second
anniversary of the Effective Time or (ii) such time as there are no longer any
Registrable Securities outstanding; provided, however, that no holder shall be
entitled to be named as a selling securityholder in the Shelf Registration
Statement or to use the prospectus forming a part thereof for resales of
Registrable Securities unless such holder is an Electing Holder, and (y) after
the Effective Time of the Shelf Registration Statement, promptly upon the
request of any holder of Registrable Securities that is not then an Electing
Holder, to take any action reasonably necessary to enable such holder to use the
prospectus forming a part thereof for resales of Registrable Securities,
including, without limitation, any action necessary to identify such holder as a
selling securityholder in the Shelf Registration Statement, provided, however,
that nothing in this clause (y) shall relieve any such holder of the obligation
to return a completed and signed Notice and Questionnaire to the Issuers in
accordance with Section 3(d)(iii) hereof. The Issuers further agree to
supplement or make amendments to the Shelf Registration Statement, as and when
required by the rules, regulations or instructions applicable to the
registration form used by the Issuers for such Shelf Registration Statement or
by the Securities Act or rules and regulations thereunder for shelf
registration, and the Issuers agree to furnish to each Electing Holder copies of
any such supplement or amendment prior to its being used or promptly following
its filing with the Commission.
(c) In the event that (i) the Issuers have not filed the Exchange Offer
Registration Statement or Shelf Registration Statement on or before the date on
which such registration statement is required to be filed pursuant to Section
2(a) or 2(b), respectively, or (ii) such Exchange Offer Registration Statement
or Shelf Registration Statement has not become effective or been declared
effective by the Commission on or before the date on which such registration
statement is required to become or be declared effective pursuant to Section
2(a) or 2(b), respectively, or (iii) the Exchange Offer has not been completed
within 30 business days after the initial effective date of the Exchange Offer
Registration Statement relating to the Exchange Offer (if the Exchange Offer is
then required to be made) or (iv) any Exchange Offer Registration Statement or
Shelf
6
Registration Statement required by Section 2(a) or 2(b) hereof is filed and
becomes or is declared effective but shall thereafter either be withdrawn by the
Issuers or shall become subject to an effective stop order issued pursuant to
Section 8(d) of the Securities Act suspending the effectiveness of such
registration statement (except as specifically permitted herein) without being
succeeded immediately by an additional registration statement filed and declared
effective (each such event referred to in clauses (i) through (iv), a
"Registration Default" and each period during which a Registration Default has
occurred and is continuing, a "Registration Default Period"), then, as
liquidated damages for such Registration Default, subject to the provisions of
Section 9(b), special interest ("Special Interest"), in addition to the Base
Interest, shall accrue on the average Accreted Value (as defined in the
Indenture) of the outstanding Notes at a per annum rate of 0.25% for the first
90 days of the Registration Default Period, at a per annum rate of 0.50% for the
second 90 days of the Registration Default Period, at a per annum rate of 0.75%
for the third 90 days of the Registration Default Period and at a per annum rate
of 1.0% thereafter for the remaining portion of the Registration Default Period.
All accrued Special Interest shall be paid in cash by the Issuers on each
Interest Payment Date (as defined in the Indenture). Notwithstanding the
foregoing and anything in this Agreement to the contrary, in the case of an
event referred to in clause (ii) above, a "Registration Default" shall be deemed
not to have occurred so long as the Issuers, in their sole reasonable judgment,
are using and continuing to use their reasonable best efforts to cause such
Exchange Offer Registration Statement or Shelf Registration Statement, as the
case may be, to become or be declared effective.
(d) The Issuers shall use their reasonable best efforts to take all
actions necessary or advisable to be taken by them to ensure that the
transactions contemplated herein are effected as so contemplated in Section 2(a)
or 2(b) hereof.
(e) Any reference herein to a registration statement as of any time
shall be deemed to include any document incorporated, or deemed to be
incorporated, therein by reference as of such time and any reference herein to
any post-effective amendment to a registration statement as of any time shall be
deemed to include any document incorporated, or deemed to be incorporated,
therein by reference as of such time.
3. Registration Procedures.
If the Issuers file a registration statement pursuant to Section 2(a) or
Section 2(b), the following provisions shall apply:
7
(a) At or before the Effective Time of the Exchange Offer or the Shelf
Registration, as the case may be, the Issuers shall cause the Indenture to be
qualified under the Trust Indenture Act of 1939.
(b) In the event that such qualification would require the appointment
of a new trustee under the Indenture, the Issuers shall appoint a new trustee
thereunder pursuant to the applicable provisions of the Indenture.
(c) In connection with the Issuers' obligations with respect to the
registration of Exchange Notes as contemplated by Section 2(a) (the "Exchange
Offer Registration"), if applicable, the Issuers shall, as soon as practicable
(or as otherwise specified):
(i) prepare and file with the Commission, as soon as practicable
but no later than 120 days after the Closing Date, an Exchange Offer
Registration Statement on any form which may be utilized by the Issuers
and which shall permit the Exchange Offer and resales of Exchange Notes
by broker-dealers during the Resale Period to be effected as
contemplated by Section 2(a), and use their reasonable best efforts to
cause such Exchange Offer Registration Statement to become or be
declared effective as soon as practicable thereafter, but no later than
180 days after the Closing Date;
(ii) as soon as practicable prepare and file with the Commission
such amendments and supplements to such Exchange Offer Registration
Statement and the prospectus included therein as may be necessary to
effect and maintain the effectiveness of such Exchange Offer
Registration Statement for the periods and purposes contemplated in
Section 2(a) hereof and as may be required by the applicable rules and
regulations of the Commission and the instructions applicable to the
form of such Exchange Offer Registration Statement, and promptly provide
each broker-dealer holding Exchange Notes with such number of copies of
the prospectus included therein (as then amended or supplemented), in
conformity in all material respects with the requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations
of the Commission thereunder, as such broker-dealer reasonably may
request prior to the expiration of the Resale Period, for use in
connection with resales of Exchange Notes;
(iii) promptly notify each broker-dealer that has requested or
received copies of the prospectus included in such registration
statement, and confirm such advice in writing, (A) when such Exchange
Offer Registration Statement or the prospectus included therein or any
prospectus amendment or supplement or post-effective amendment has been
filed, and, with respect to such Exchange Offer Registration Statement
or any post-effective amendment, when the same has become effective, (B)
of any comments by the Commission and by the blue sky or securities
commissioner or regulator of any state with respect thereto, or any
8
request by the Commission for amendments or supplements to such Exchange
Offer Registration Statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such Exchange Offer Registration
Statement or the initiation or, to the knowledge of the Issuers,
threatening of any proceedings for that purpose, (D) if at any time the
representations and warranties of the Issuers contemplated by Section 5
hereof cease to be true and correct in all material respects, (E) of the
receipt by the Issuers of any notification with respect to the
suspension of the qualification of the Exchange Notes for sale in any
jurisdiction or the initiation or, to the knowledge of the Issuers,
threatening of any proceeding for such purpose, or (F) at any time
during the Resale Period when a prospectus is required to be delivered
under the Securities Act, that such Exchange Offer Registration
Statement, prospectus, prospectus amendment or supplement or
post-effective amendment does not conform in all material respects to
the applicable requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission
thereunder, or contains an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances
then existing;
(iv) in the event that the Issuers would be required, pursuant to
Section 3(e)(iii)(F) above, to notify any broker-dealers holding
Exchange Notes, the Issuers shall prepare and furnish to each such
holder a reasonable number of copies of a prospectus supplemented or
amended so that, as thereafter delivered to purchasers of such Exchange
Notes during the Resale Period, such prospectus conforms in all material
respects to the applicable requirements of the Securities Act and the
Trust Indenture Act and the rules and regulations of the Commission
thereunder and shall not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;
(v) use their reasonable best efforts to obtain the withdrawal of
any order suspending the effectiveness of such Exchange Offer
Registration Statement or any post-effective amendment thereto as soon
as practicable;
(vi) use their reasonable best efforts to (A) register or qualify
the Exchange Notes under the securities laws or blue sky laws of such
jurisdictions as are contemplated by Section 2(a) no later than the
commencement of the Exchange Offer, (B) keep such registrations or
qualifications in effect and comply with such laws so as to permit the
continuance of offers, sales and dealings therein in such jurisdictions
until the expiration of the Resale Period and (C) take any and all other
actions as may be reasonably necessary or advisable to enable each
broker-dealer holding Exchange Notes to consummate the disposition
thereof in such jurisdictions; provided, however, that neither of the
Issuers shall
9
be required for any such purpose to (1) qualify as a foreign corporation
or limited liability company, as the case may be, in any jurisdiction
wherein it would not otherwise be required to qualify but for the
requirements of this Section 3(c)(vi), (2) consent to general service of
process in any such jurisdiction or (3) make any changes to its
certificate of incorporation or by-laws (or other organizational
document) or any agreement between it and holders of its ownership
interests;
(vii) use their reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal,
state or local, which may be required to effect the Exchange Offer
Registration, the Exchange Offer and the offering and sale of Exchange
Notes by broker-dealers during the Resale Period;
(viii) provide a CUSIP number for all Exchange Notes, not later
than the applicable Effective Time;
(ix) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as soon
as practicable but no later than eighteen months after the effective
date of such Exchange Offer Registration Statement, an earning statement
of the Company and its subsidiaries complying with Section 11(a) of the
Securities Act (including, at the option of the Company, Rule 158
thereunder).
(d) In connection with the Issuers' obligations with respect to the
Shelf Registration, if applicable, the Issuers shall, as soon as practicable (or
as otherwise specified):
(i) prepare and file with the Commission within the time periods
specified in Section 2(b), a Shelf Registration Statement on any form
which may be utilized by the Issuers and which shall register all of the
Registrable Securities for resale by the holders thereof in accordance
with such method or methods of disposition as may be specified by such
of the holders as, from time to time, may be Electing Holders and use
their reasonable best efforts to cause such Shelf Registration Statement
to become or be declared effective within the time periods specified in
Section 2(b);
(ii) not less than 30 calendar days prior to the Effective Time of
the Shelf Registration Statement, mail the Notice and Questionnaire to
the holders of Registrable Securities; no holder shall be entitled to be
named as a selling securityholder in the Shelf Registration Statement as
of the Effective Time, and no holder shall be entitled to use the
prospectus forming a part thereof for resales of Registrable Securities
at any time, unless such holder has returned a completed and signed
Notice and Questionnaire to the Issuers by the deadline for response
10
set forth therein; provided, however, holders of Registrable Securities
shall have at least 28 calendar days from the date on which the Notice
and Questionnaire is first mailed to such holders to return a completed
and signed Notice and Questionnaire to the Issuers;
(iii) after the Effective Time of the Shelf Registration Statement,
upon the request of any holder of Registrable Securities that is not
then an Electing Holder, promptly send a Notice and Questionnaire to
such holder; provided that the Issuers shall not be required to take any
action to name such holder as a selling securityholder in the Shelf
Registration Statement or to enable such holder to use the prospectus
forming a part thereof for resales of Registrable Securities until such
holder has returned a completed and signed Notice and Questionnaire to
the Issuers;
(iv) as soon as practicable prepare and file with the Commission
such amendments and supplements to such Shelf Registration Statement and
the prospectus included therein as may be necessary to effect and
maintain the effectiveness of such Shelf Registration Statement for the
period specified in Section 2(b) thereof and as may be required by the
applicable rules and regulations of the Commission and the instructions
applicable to the form of such Shelf Registration Statement, and furnish
to the Electing Holders copies of any such supplement or amendment
simultaneously with or prior to its being used or filed with the
Commission;
(v) comply with the provisions of the Securities Act with respect
to the disposition of all of the Registrable Securities covered by such
Shelf Registration Statement in accordance with the intended methods of
disposition by the Electing Holders provided for in such Shelf
Registration Statement;
(vi) provide (A) the Electing Holders, (B) the underwriters (which
term, for purposes of this Exchange and Registration Rights Agreement,
shall include a person deemed to be an underwriter within the meaning of
Section 2(a)(11) of the Securities Act), if any, thereof, (C) any sales
or placement agent therefor, (D) counsel for any such underwriter or
agent and (E) not more than one counsel for all the Electing Holders the
opportunity to participate in the preparation of such Shelf Registration
Statement, each prospectus included therein or filed with the Commission
and each amendment or supplement thereto;
(vii) for a reasonable period prior to the filing of such Shelf
Registration Statement, and throughout the period specified in Section
2(b), make available at reasonable times at the Issuers' principal place
of business or such other reasonable place for inspection by the persons
referred to in Section 3(d)(vi) who shall certify to the Issuers that
they have a current intention to sell the Registrable
11
Securities pursuant to the Shelf Registration such financial and other
relevant information and books and records of the Issuers, and cause the
officers, employees, counsel and independent certified public
accountants of the Issuers to respond to such inquiries, as shall be
reasonably necessary, in the judgment of the respective counsel referred
to in such Section, to conduct a reasonable investigation within the
meaning of Section 11 of the Securities Act; provided, however, that
each such party shall be required to maintain in confidence and not to
disclose to any other person any information or records reasonably
designated by the Issuers as being confidential, until such time as (A)
such information becomes a matter of public record (whether by virtue of
its inclusion in such registration statement or otherwise, except as a
result of a breach of this or any other obligation of confidentiality to
the Issuers), or (B) such person shall be required so to disclose such
information pursuant to a subpoena or order of any court or other
governmental agency or body having jurisdiction over the matter (subject
to the requirements of such order, and only after such person shall have
given the Issuers prompt prior written notice of such requirement), or
(C) such information is required to be set forth in such Shelf
Registration Statement or the prospectus included therein or in an
amendment to such Shelf Registration Statement or an amendment or
supplement to such prospectus in order that such Shelf Registration
Statement, prospectus, amendment or supplement, as the case may be,
complies with applicable requirements of the federal securities laws and
the rules and regulations of the Commission and does not contain an
untrue statement of a material fact or omit to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing;
(viii) promptly notify each of the Electing Holders, any sales or
placement agent therefor and any underwriter thereof (which notification
may be made through any managing underwriter that is a representative of
such underwriter for such purpose) and confirm such advice in writing,
(A) when such Shelf Registration Statement or the prospectus included
therein or any prospectus amendment or supplement or post-effective
amendment has been filed, and, with respect to such Shelf Registration
Statement or any post-effective amendment, when the same has become
effective, (B) of any comments by the Commission and by the blue sky or
securities commissioner or regulator of any state with respect thereto,
or any request by the Commission for amendments or supplements to such
Shelf Registration Statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such Shelf Registration Statement or the
initiation or, to the knowledge of the Issuers, threatening of any
proceedings for that purpose, (D) if at any time the representations and
warranties of the Issuers contemplated by Section 3(d)(xvii) or Section
5 hereof cease to be true and correct in all material respects, (E) of
the receipt by the Issuers of any notification with respect to the
12
suspension of the qualification of the Registrable Securities for sale
in any jurisdiction or the initiation or, to the knowledge of the
Issuers, threatening of any proceeding for such purpose, or (F) if at
any time when a prospectus is required to be delivered under the
Securities Act, that such Shelf Registration Statement, prospectus,
prospectus amendment or supplement or post-effective amendment does not
conform in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations
of the Commission thereunder, or contains an untrue statement of a
material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading in
light of the circumstances then existing;
(ix) use their reasonable best efforts to obtain the withdrawal of
any order suspending the effectiveness of such registration statement or
any post-effective amendment thereto as soon as practicable;
(x) if requested by any managing underwriter or underwriters, any
placement or sales agent or any Electing Holder, promptly incorporate in
a prospectus supplement or post-effective amendment such information as
is required by the applicable rules and regulations of the Commission,
and as such managing underwriter or underwriters, such agent or such
Electing Holder specifies should be included therein relating to the
terms of the sale of such Registrable Securities, including information
(i) with respect to the principal amount of Registrable Securities being
sold by such Electing Holder or agent or to any underwriters, the name
and description of such Electing Holder, agent or underwriter, the
offering price of such Registrable Securities, and any discount,
commission or other compensation payable in respect thereof and the
purchase price being paid therefor by such underwriters and (ii) with
respect to any other material terms of the offering of the Registrable
Securities to be sold by such Electing Holder or agent or to such
underwriters; and make all required filings of such prospectus
supplement or post-effective amendment upon notification of the matters
to be incorporated in such prospectus supplement or post-effective
amendment;
(xi) furnish to each Electing Holder, each placement or sales
agent, if any, therefor, each underwriter, if any, thereof and the
respective counsel referred to in Section 3(d)(vi) hereof an executed
copy (or, in the case of an Electing Holder, a conformed copy) of such
Shelf Registration Statement, each such amendment and supplement thereto
(in each case including all exhibits thereto (in the case of an Electing
Holder of Registrable Securities, upon request) and documents
incorporated by reference therein) and such number of copies of such
Shelf Registration Statement (excluding exhibits thereto and documents
incorporated by reference therein unless specifically so requested by
such Electing Holder, agent or underwriter, as the case may be) and of
the prospectus
13
included in such Shelf Registration Statement (including each
preliminary prospectus and any summary prospectus), in conformity in all
material respects with the applicable requirements of the Securities Act
and the Trust Indenture Act, and the rules and regulations of the
Commission thereunder, and such other documents, as such Electing
Holder, agent, if any, and underwriter, if any, may reasonably request
in order to facilitate the offering and disposition of the Registrable
Securities owned by such Electing Holder, offered or sold by such agent
or underwritten by such underwriter and to permit such Electing Holder,
agent and underwriter to satisfy the prospectus delivery requirements of
the Securities Act; and the Issuers hereby consent to the use of such
prospectus (including such preliminary and summary prospectus) and any
amendment or supplement thereto by each such Electing Holder and by any
such agent and underwriter, in each case in the form most recently
provided to such person by the Issuers, in connection with the offering
and sale of the Registrable Securities covered by the prospectus
(including such preliminary and summary prospectus) or any supplement or
amendment thereto;
(xii) use their reasonable best efforts to (A) register or qualify
the Registrable Securities to be included in such Shelf Registration
Statement under such securities laws or blue sky laws of such
jurisdictions as any Electing Holder and each placement or sales agent,
if any, therefor and underwriter, if any, thereof shall reasonably
request, (B) keep such registrations or qualifications in effect and
comply with such laws so as to permit the continuance of offers, sales
and dealings therein in such jurisdictions during the period the Shelf
Registration is required to remain effective under Section 2(b) above
and for so long as may be necessary to enable any such Electing Holder,
agent or underwriter to complete its distribution of Notes pursuant to
such Shelf Registration Statement and (C) take any and all other actions
as may be reasonably necessary or advisable to enable each such Electing
Holder, agent, if any, and underwriter, if any, to consummate the
disposition in such jurisdictions of such Registrable Securities;
provided, however, that none of the Issuers shall be required for any
such purpose to (1) qualify as a foreign corporation or limited
liability company, as the case may be, in any jurisdiction wherein it
would not otherwise be required to qualify but for the requirements of
this Section 3(d)(xii), (2) consent to general service of process in any
such jurisdiction or (3) make any changes to its certificate of
incorporation or by-laws (or other organizational document) or any
agreement between it and holders of its ownership interests;
(xiii) use their reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal,
state or local, which may be required to effect the Shelf Registration
or the offering or sale in connection therewith or to enable the selling
holder or holders to offer, or to consummate the disposition of, their
Registrable Securities;
14
(xiv) unless any Registrable Securities shall be in book-entry only
form, cooperate with the Electing Holders and the managing underwriters,
if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold, which
certificates, if so required by any securities exchange upon which any
Registrable Securities are listed, shall be penned, lithographed or
engraved, or produced by any combination of such methods, on steel
engraved borders, and which certificates shall not bear any restrictive
legends; and, in the case of an underwritten offering, enable such
Registrable Securities to be in such denominations and registered in
such names as the managing underwriters may request at least two
business days prior to any sale of the Registrable Securities;
(xv) provide a CUSIP number for all Registrable Securities, not
later than the applicable Effective Time;
(xvi) enter into one or more underwriting agreements, engagement
letters, agency agreements, "best efforts" underwriting agreements or
similar agreements, as appropriate, including customary provisions
relating to indemnification and contribution, and take such other
actions in connection therewith as any Electing Holders of at least 20%
in aggregate principal amount of the Registrable Securities at the time
outstanding shall request in order to expedite or facilitate the
disposition of such Registrable Securities;
(xvii) whether or not an agreement of the type referred to in
Section 3(d)(xvi) hereof is entered into, and whether or not any portion
of the offering contemplated by the Shelf Registration is an
underwritten offering or is made through a placement or sales agent or
any other entity, (A) make such representations and warranties to the
Electing Holders and the placement or sales agent, if any, therefor and
the underwriters, if any, thereof in form, substance and scope as are
customarily made in connection with an offering of debt securities
pursuant to any appropriate agreement or to a registration statement
filed on the form applicable to the Shelf Registration; (B) obtain an
opinion of counsel to the Issuers in customary form, subject to
customary limitations, assumptions and exclusions, and covering such
matters, of the type customarily covered by such an opinion, as the
managing underwriters, if any, or as any Electing Holders of at least
20% in aggregate principal amount of the Registrable Securities at the
time outstanding may reasonably request, addressed to such Electing
Holder or Electing Holders and the placement or sales agent, if any,
therefor and the underwriters, if any, thereof and dated the date of the
Effective Time of such Shelf Registration Statement (and if such Shelf
Registration Statement contemplates an underwritten offering of a part
or all of the Registrable Securities, dated the date of the closing
under the underwriting agreement relating thereto) (it being agreed that
the matters to be covered by such opinion shall
15
include the matters set forth in paragraphs (b) and (d) of Section 7 of
the Purchase Agreement to the extent applicable to an offering of this
type); (C) obtain a "cold comfort" letter or letters from the
independent certified public accountants of the Issuers addressed to the
selling Electing Holders, the placement or sales agent, if any, therefor
or the underwriters, if any, thereof, dated (i) the effective date of
such Shelf Registration Statement and (ii) the effective date of any
prospectus supplement to the prospectus included in such Shelf
Registration Statement or post-effective amendment to such Shelf
Registration Statement which includes unaudited or audited financial
statements as of a date or for a period subsequent to that of the latest
such statements included in such prospectus (and, if such Shelf
Registration Statement contemplates an underwritten offering pursuant to
any prospectus supplement to the prospectus included in such Shelf
Registration Statement or post-effective amendment to such Shelf
Registration Statement which includes unaudited or audited financial
statements as of a date or for a period subsequent to that of the latest
such statements included in such prospectus, dated the date of the
closing under the underwriting agreement relating thereto), such letter
or letters to be in customary form and covering such matters of the type
customarily covered by letters of such type; (D) deliver such documents
and certificates, including officers' certificates, as may be reasonably
requested by any Electing Holders of at least 20% in aggregate principal
amount of the Registrable Securities at the time outstanding or the
placement or sales agent, if any, therefor and the managing
underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or
those contained in Section 5(a) hereof and the compliance with or
satisfaction of any agreements or conditions contained in the
underwriting agreement or other similar agreement entered into by the
Issuers pursuant to Section 3(d)(xvi); and (E) undertake such
obligations relating to expense reimbursement, indemnification and
contribution as are provided in Section 6 hereof;
(xviii) notify in writing each holder of Registrable Securities of
any proposal by the Issuers to amend or waive any provision of this
Exchange and Registration Rights Agreement pursuant to Section 9(h)
hereof and of any amendment or waiver effected pursuant thereto, each of
which notices shall contain the substance of the amendment or waiver
proposed or effected, as the case may be;
(xix) in the event that any broker-dealer registered under the
Exchange Act shall underwrite any Registrable Securities or participate
as a member of an underwriting syndicate or selling group or "assist in
the distribution" (within the meaning of the Conduct Rules (the "Conduct
Rules") of the National Association of Securities Dealers, Inc. ("NASD")
or any successor thereto, as amended from time to time) thereof, whether
as a holder of such Registrable Securities or as an
16
underwriter, a placement or sales agent or a broker or dealer in respect
thereof, or otherwise, assist such broker-dealer in complying with the
requirements of such Conduct Rules, including by (A) if such Conduct
Rules shall so require, engaging a "qualified independent underwriter"
(as defined in such Conduct Rules) to participate in the preparation of
the Shelf Registration Statement relating to such Registrable
Securities, to exercise usual standards of due diligence in respect
thereto and, if any portion of the offering contemplated by such Shelf
Registration Statement is an underwritten offering or is made through a
placement or sales agent, to recommend the yield of such Registrable
Securities, (B) indemnifying any such qualified independent underwriter
to the extent of the indemnification of underwriters provided in Section
6 hereof (or to such other customary extent as may be requested by such
underwriter), and (C) providing such information to such broker-dealer
as may be required in order for such broker-dealer to comply with the
requirements of the Conduct Rules; and
(xx) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as soon
as practicable but in any event not later than eighteen months after the
effective date of such Shelf Registration Statement, an earning
statement of the Company and its subsidiaries complying with Section
11(a) of the Securities Act (including, at the option of the Company,
Rule 158 thereunder).
17
(e) In the event that the Issuers would be required, pursuant to Section
3(d)(viii)(F) above, to notify the Electing Holders, the placement or sales
agent, if any, therefor and the managing underwriters, if any, thereof, the
Issuers shall prepare and furnish to each of the Electing Holders, to each
placement or sales agent, if any, and to each such underwriter, if any, a
reasonable number of copies of a prospectus supplemented or amended so that, as
thereafter delivered to purchasers of Registrable Securities, such prospectus
conforms in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act, and the rules and regulations of the
Commission thereunder, and shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances then
existing. Each Electing Holder agrees that upon receipt of any notice from the
Issuers pursuant to Section 3(d)(viii)(F) hereof, such Electing Holder shall
forthwith discontinue the disposition of Registrable Securities pursuant to the
Shelf Registration Statement applicable to such Registrable Securities until
such Electing Holder shall have received copies of such amended or supplemented
prospectus, and if so directed by the Issuers, such Electing Holder shall
deliver to the Issuers (at the Issuers' expense) all copies, other than
permanent file copies, then in such Electing Holder's possession of the
prospectus covering such Registrable Securities at the time of receipt of such
notice.
(f) In the event of a Shelf Registration, in addition to the information
required to be provided by each Electing Holder in its Notice and Questionnaire,
the Issuers may require such Electing Holder to furnish to the Issuers such
additional information regarding such Electing Holder and such Electing Holder's
intended method of distribution of Registrable Securities as may be required in
order to comply with the Securities Act. Each such Electing Holder agrees to
notify the Issuers as promptly as practicable of any inaccuracy or change in
information previously furnished by such Electing Holder to the Issuers or of
the occurrence of any event in either case as a result of which any prospectus
relating to such Shelf Registration contains or would contain an untrue
statement of a material fact regarding such Electing Holder or such Electing
Holder's intended method of disposition of such Registrable Securities or omits
to state any material fact regarding such Electing Holder or such Electing
Holder's intended method of disposition of such Registrable Securities required
to be stated therein or necessary to make the statements therein not misleading
in light of the circumstances then existing, and promptly to furnish to the
Issuers any additional information required to correct and update any previously
furnished information or required so that such prospectus shall not contain,
with respect to such Electing Holder or the disposition of such Registrable
Securities, an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing.
4. Registration Expenses.
18
The Issuers agree, subject to the last sentence of this Section, to bear
and to pay or cause to be paid promptly all expenses incident to the Issuers'
performance of or compliance with this Exchange and Registration Rights
Agreement, including (a) all Commission and any NASD registration, filing and
review fees and expenses including fees and disbursements of counsel for the
placement or sales agent or underwriters in connection with such registration,
filing and review, (b) all fees and expenses in connection with the
qualification of the Notes for offering and sale under the securities laws and
blue sky laws referred to in Section 3(d)(xii) hereof and determination of their
eligibility for investment under the laws of such jurisdictions as any managing
underwriters or the Electing Holders may designate, including any fees and
disbursements of counsel for the Electing Holders or underwriters in connection
with such qualification and determination, (c) all expenses relating to the
preparation, printing, production, distribution and reproduction of each
registration statement required to be filed hereunder, each prospectus included
therein or prepared for distribution pursuant hereto, each amendment or
supplement to the foregoing, the expenses of preparing the Notes for delivery
and the expenses of printing or producing any underwriting agreements,
agreements among underwriters, selling agreements and blue sky or legal
investment memoranda and all other documents in connection with the offering,
sale or delivery of Notes to be disposed of (including certificates representing
the Notes), (d) messenger, telephone and delivery expenses relating to the
offering, sale or delivery of Notes and the preparation of documents referred in
clause (c) above, (e) fees and expenses of the Trustee under the Indenture, any
agent of the Trustee and any reasonable fees and expenses for counsel for the
Trustee and of any collateral agent or custodian, (f) internal expenses
(including all salaries and expenses of the Issuers' officers and employees
performing legal or accounting duties), (g) fees, disbursements and expenses of
counsel and independent certified public accountants of the Issuers (including
the expenses of any opinions or "cold comfort" letters required by or incident
to such performance and compliance), (h) fees, disbursements and expenses of any
"qualified independent underwriter" engaged pursuant to Section 3(d)(xix)
hereof, (i) reasonable fees, disbursements and expenses of one counsel for the
Electing Holders retained in connection with a Shelf Registration, as selected
by the Electing Holders of at least a majority in aggregate principal amount of
the Registrable Securities held by Electing Holders (which counsel shall be
reasonably satisfactory to the Issuers), (j) any fees charged by securities
rating services for rating the Notes, and (k) reasonable fees, expenses and
disbursements of any other persons, including special experts, retained by the
Issuers in connection with such registration (collectively, the "Registration
Expenses"). To the extent that any Registration Expenses are incurred, assumed
or paid by any holder of Registrable Securities or any placement or sales agent
therefor or underwriter thereof, the Issuers shall reimburse such person for the
full amount of the Registration Expenses so incurred, assumed or paid promptly
after receipt of a request therefor. Notwithstanding the foregoing, the holders
of the Registrable Securities being registered shall pay all agency fees and
commissions and underwriting discounts and commissions attributable to the sale
of such Registrable Securities and the fees and
19
disbursements of any counsel or other advisors or experts retained by such
holders (severally or jointly), other than the counsel and experts specifically
referred to above.
5. Representations, Warranties and Covenants.
Except with respect to clauses (a) and (b) below, the Issuers represent
and warrant to, and agree with, each Purchaser and each of the holders from time
to time of Registrable Securities the information set forth in this Section 5.
With respect to clauses (a) and (b) below, the Issuers covenant that:
(a) Each registration statement covering Registrable Securities and each
prospectus (including any preliminary or summary prospectus) contained therein
or furnished pursuant to Section 3(d) or Section 3(c) hereof and any further
amendments or supplements to any such registration statement or prospectus, when
it becomes effective or is filed with the Commission, as the case may be, and,
in the case of an underwritten offering of Registrable Securities, at the time
of the closing under the underwriting agreement relating thereto, will conform
in all material respects to the requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; and at all times subsequent to the Effective Time when a
prospectus would be required to be delivered under the Securities Act, other
than from (i) such time as a notice has been given to holders of Registrable
Securities pursuant to Section 3(d)(viii)(F) or Section 3(c)(iii)(F) hereof
until (ii) such time as the Issuers furnishes an amended or supplemented
prospectus pursuant to Section 3(e) or Section 3(c)(iv) hereof, each such
registration statement, and each prospectus (including any summary prospectus)
contained therein or furnished pursuant to Section 3(d) or Section 3(c) hereof,
as then amended or supplemented, will conform in all material respects to the
requirements of the Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make
20
the statements therein not misleading in the light of the circumstances then
existing; provided, however, that this covenant shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Issuers by a holder of Registrable Securities
expressly for use therein.
(b) Any documents incorporated by reference in any prospectus referred
to in Section 5(a) hereof, when they become or became effective or are or were
filed with the Commission, as the case may be, will conform or conformed in all
material respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and none of such documents will contain or contained an untrue
statement of a material fact or will omit or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this covenant shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Issuers by a holder of Registrable Securities
expressly for use therein.
(c) The compliance by the Issuers with all of the provisions of this
Exchange and Registration Rights Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a material
breach of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement, lease, license, franchise
agreement, permit or other material agreement or instrument to which either of
the Issuers or any of their subsidiaries is a party or by which either of the
Issuers or any of their subsidiaries is bound or to which any of the property or
assets of the Issuers or any of their subsidiaries is subject, nor will such
action result in any violation of the provisions of the certificate of formation
or limited liability company agreement of the Company or the certificate of
incorporation or bylaws of Charter Capital or any statute or any order, rule or
regulation of any court or governmental agency or body, including without
limitation, the Communications Act of 1934, as amended, the Cable Communications
Policy Act of 1984, as amended, the Cable Television Consumer Protection and
Competition Act of 1992, as amended, and the Telecommunications Act of 1996
(collectively, the "Cable Acts") or any order, rule or regulation of the Federal
Communications Commission (the "FCC"), having jurisdiction over the Issuers or
any of their subsidiaries or any of their properties, except for any such
violation which would not materially impair the Issuers' ability to comply
herewith; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required, including, without limitation, under the Cable Acts or any order, rule
or regulation of the FCC, for the consummation by the Issuers of the
transactions contemplated by this Exchange and Registration Rights Agreement,
except the registration under the Securities Act of the Notes, qualification of
the Indenture under the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under State
Notes or blue sky laws in connection with the offering and distribution of the
Notes.
(d) This Exchange and Registration Rights Agreement has been duly
authorized, executed and delivered by the Issuers.
6. Indemnification.
(a) Indemnification by the Issuers. The Issuers , jointly and severally,
(i) will indemnify and hold harmless each of the holders of Registrable
Securities included in an Exchange Offer Registration Statement, each of the
Electing Holders of Registrable Securities included in a Shelf Registration
Statement and each person who participates as a placement or sales agent or as
an underwriter in any offering or sale of such Registrable Securities against
any losses, claims, damages or liabilities, joint or several, to which
21
such holder, agent or underwriter may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Exchange Offer Registration
Statement or Shelf Registration Statement, as the case may be, under which such
Registrable Securities were registered under the Securities Act, or any
preliminary, final or summary prospectus contained therein or furnished by the
Issuers to any such holder, Electing Holder, agent or underwriter, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and (ii)
will reimburse such holder, such Electing Holder, such agent and such
underwriter for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that neither of the Issuers shall be
liable to any such persons in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, or preliminary, final or summary prospectus, or
amendment or supplement thereto, in reliance upon and in conformity with written
information furnished to the Issuers by such persons expressly for use therein.
(b) Indemnification by the Holders and any Agents and Underwriters. The
Issuers may require, as a condition to including any Registrable Securities in
any registration statement filed pursuant to Section 2(b) hereof and to entering
into any underwriting agreement or similar agreement with respect thereto, that
the Issuers shall have received an undertaking reasonably satisfactory to them
from the Electing Holder of such Registrable Securities included in a Shelf
Registration Statement and from each underwriter or agent named in any such
underwriting agreement or similar agreement, severally and not jointly, to (i)
indemnify and hold harmless the Issuers and all other holders of Registrable
Securities, against any losses, claims, damages or liabilities to which the
Issuers or such other holders of Registrable Securities may become subject,
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
such registration statement, or any preliminary, final or summary prospectus
contained therein or furnished by the Issuers to any such Electing Holder, agent
or underwriter, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Issuers by such Electing Holder or underwriter expressly for use therein, and
(ii) reimburse the Issuers for any legal or other expenses reasonably incurred
by the Issuers in connection with investigating or defending any such action or
claim as such expenses are incurred;
22
provided, however, that no such Electing Holder shall be required to undertake
liability to any person under this Section 6(b) for any amounts in excess of the
dollar amount of the proceeds to be received by such Electing Holder from the
sale of such Electing Holder's Registrable Securities pursuant to such
registration.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party under subsection (a) or (b) above of written notice of the commencement of
any action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party pursuant to the indemnification provisions of
or contemplated by this Section 6, notify such indemnifying party in writing of
the commencement of such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party otherwise than under the indemnification provisions of or
contemplated by Section 6(a) or 6(b) hereof. In case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
of the commencement thereof, such indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, such indemnifying party shall
not be liable to such indemnified party for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified
party.
(d) Contribution. If for any reason the indemnification provisions
contemplated by Section 6(a) or Section 6(b) are unavailable to or insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages
or liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and the indemnified
23
party in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by such indemnifying party or by such indemnified party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The parties hereto
agree that it would not be just and equitable if contributions pursuant to this
Section 6(d) were determined by pro rata allocation (even if the holders or any
agents or underwriters or all of them were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 6(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages, or
liabilities (or actions in respect thereof) referred to above shall be deemed to
include any legal or other fees or expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 6(d), no holder shall
be required to contribute any amount in excess of the amount by which the dollar
amount of the proceeds received by such holder from the sale of any Registrable
Securities (after deducting any fees, discounts and commissions applicable
thereto) exceeds the amount of any damages which such holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission, and no underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Registrable
Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The holders' and any underwriters' obligations in this
Section 6(d) to contribute shall be several in proportion to the principal
amount of Registrable Securities registered or underwritten, as the case may be,
by them and not joint.
(e) The obligations of the Issuers under this Section 6 shall be in
addition to any liability which the Issuers may otherwise have and shall extend,
upon the same terms and conditions, to each officer, director and partner of
each holder, agent and underwriter and each person, if any, who controls any
holder, agent or underwriter within the meaning of the Securities Act; and the
obligations of the holders and any agents or underwriters contemplated by this
Section 6 shall be in addition to any liability which the respective holder,
agent or underwriter may otherwise have and shall extend, upon the same terms
and conditions, to each officer (including any officer who signed any
registration statement), director, employee, representative or agent of the
Issuers and to each person, if any, who controls the Issuers within the meaning
of the Securities Act.
7. Underwritten Offerings.
24
(a) Selection of Underwriters. If any of the Registrable Securities
covered by the Shelf Registration are to be sold pursuant to an underwritten
offering, the managing underwriter or underwriters thereof shall be designated
by Electing Holders holding at least a majority in aggregate principal amount of
the Registrable Securities to be included in such offering, provided that such
designated managing underwriter or underwriters is or are reasonably acceptable
to the Issuers.
(b) Participation by Holders. Each holder of Registrable Securities
hereby agrees with each other such holder that no such holder may participate in
any underwritten offering hereunder unless such holder (i) agrees to sell such
holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
8. Rule 144.
Each of the Issuers covenants to the holders of Registrable Securities
that to the extent it shall be required to do so under the Exchange Act, it
shall timely file the reports required to be filed by it under the Exchange Act
or the Securities Act (including the reports under Section 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the
Commission under the Securities Act) and the rules and regulations adopted by
the Commission thereunder, and shall take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required from
time to time to enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitations of the exemption
provided by Rule 144 under the Securities Act, as such Rule may be amended from
time to time, or any similar or successor rule or regulation hereafter adopted
by the Commission. Upon the request of any holder of Registrable Securities in
connection with that holder's sale pursuant to Rule 144, the Issuers shall
deliver to such holder a written statement as to whether it has complied with
such requirements.
9. Miscellaneous.
(a) No Inconsistent Agreements. The Issuers represent, warrant, covenant
and agree that they have not granted, and shall not grant, registration rights
with respect to Registrable Securities or any other Notes which would be
inconsistent with the terms contained in this Exchange and Registration Rights
Agreement.
(b) Specific Performance. The parties hereto acknowledge that there
would be no adequate remedy at law if the Issuers fail to perform any of their
obligations hereunder and that the Purchasers and the holders from time to time
of the Registrable Securities
25
may be irreparably harmed by any such failure, and accordingly agree that the
Purchasers and such holders, in addition to any other remedy to which they may
be entitled at law or in equity, shall be entitled to compel specific
performance of the obligations of the Issuers under this Exchange and
Registration Rights Agreement in accordance with the terms and conditions of
this Exchange and Registration Rights Agreement, in any court of the United
States or any State thereof having jurisdiction.
(c) Notices. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
duly given (i) when delivered by hand, if delivered personally or by courier,
(ii) when sent by facsimile (with written confirmation of receipt), provided
that a copy is mailed by registered or certified mail, return receipt requested
or (iii) three days after being deposited in the mail (registered or certified
mail, postage prepaid, return receipt requested) as follows: If to the Issuers,
c/o Charter Communications Holdings, LLC, 12444 Powerscourt Drive, Suite 100,
St. Louis, Missouri, 63131, Attention: Secretary, and if to a holder, to the
address of such holder set forth in the security register or other records of
the Issuers, or to such other address as the Issuers or any such holder may have
furnished to the other in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
(d) Parties in Interest. All the terms and provisions of this Exchange
and Registration Rights Agreement shall be binding upon, shall inure to the
benefit of and shall be enforceable by the parties hereto and the holders from
time to time of the Registrable Securities and the respective successors and
assigns of the parties hereto and such holders. In the event that any transferee
of any holder of Registrable Securities shall acquire Registrable Securities, in
any manner, whether by gift, bequest, purchase, operation of law or otherwise,
such transferee shall, without any further writing or action of any kind, be
deemed a beneficiary hereof for all purposes and such Registrable Securities
shall be held subject to all of the terms of this Exchange and Registration
Rights Agreement, and by taking and holding such Registrable Securities such
transferee shall be entitled to receive the benefits of, and be conclusively
deemed to have agreed to be bound by all of the applicable terms and provisions
of this Exchange and Registration Rights Agreement. If the Issuers shall so
request, any such successor, assign or transferee shall agree in writing to
acquire and hold the Registrable Securities subject to all of the applicable
terms hereof.
(e) Survival. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Exchange and Registration
Rights Agreement or made pursuant hereto shall remain in full force and effect
regardless of any investigation (or statement as to the results thereof) made by
or on behalf of any holder of Registrable Securities, any director, officer or
partner of such holder, any agent or underwriter or any director, officer or
partner thereof, or any controlling person of any of the foregoing, and shall
survive delivery of and payment for the Registrable Securities
26
pursuant to the Purchase Agreement and the transfer and registration of
Registrable Securities by such holder and the consummation of an Exchange Offer.
(f) Governing Law. This Exchange and Registration Rights Agreement shall
be governed by and construed in accordance with the laws of the State of New
York.
(g) Headings. The descriptive headings of the several Sections and
paragraphs of this Exchange and Registration Rights Agreement are inserted for
convenience only, do not constitute a part of this Exchange and Registration
Rights Agreement and shall not affect in any way the meaning or interpretation
of this Exchange and Registration Rights Agreement.
(h) Entire Agreement; Amendments. This Exchange and Registration Rights
Agreement and the other writings referred to herein (including the Indenture and
the form of Notes) or delivered pursuant hereto which form a part hereof contain
the entire understanding of the parties with respect to its subject matter. This
Exchange and Registration Rights Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter. This
Exchange and Registration Rights Agreement may be amended and the observance of
any term of this Exchange and Registration Rights Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument duly executed by the Issuers and the
holders of at least a majority in aggregate principal amount of the Registrable
Securities at the time outstanding. Each holder of any Registrable Securities at
the time or thereafter outstanding shall be bound by any amendment or waiver
effected pursuant to this Section 9(h), whether or not any notice, writing or
marking indicating such amendment or waiver appears on such Registrable
Securities or is delivered to such holder.
(i) Inspection. For so long as this Exchange and Registration Rights
Agreement shall be in effect, this Exchange and Registration Rights Agreement
and a complete list of the names and addresses of all the holders of Registrable
Securities shall be made available for inspection and copying, upon reasonable
prior notice, on any business day during normal business hours by any holder of
Registrable Securities for proper purposes only (which shall include any purpose
related to the rights of the holders of Registrable Securities under the Notes,
the Indenture and this Agreement) at the offices of the Issuers at the address
thereof set forth in Section 9(c) above and at the office of the Trustee under
the Indenture.
(j) Counterparts. This agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
27
If the foregoing is in accordance with your understanding, please sign
and return to us counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Issuers.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Issuers for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
Very truly yours,
CHARTER COMMUNICATIONS HOLDINGS, LLC,
as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
CHARTER COMMUNICATIONS HOLDINGS
CAPITAL CORPORATION, as an Issuer
By: /s/ RALPH G. KELLY
---------------------------------
Name: Ralph G. Kelly
Title: Senior Vice President and
Treasurer
28
Accepted as of the date hereof:
GOLDMAN, SACHS & CO.
MORGAN STANLEY & CO. INCORPORATED
BANC OF AMERICA SECURITIES LLC
BEAR, STEARNS & CO. INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SALOMON SMITH BARNEY INC.
JP MORGAN, A DIVISION OF CHASE SECURITIES INC.
CREDIT LYONNAIS SECURITIES (USA) INC.
FLEET SECURITIES, INC.
BMO NESBITT BURNS CORP.
DRESDNER KLEINWORT WASSERSTEIN SECURITIES LLC
By: GOLDMAN, SACHS & CO.
By: /s/ GOLDMAN, SACHS & CO.
-------------------------------
Name:
Title:
By: MORGAN STANLEY & CO. INCORPORATED
By: /s/ IRENE MAVROYANNIS
--------------------------------
Name: Irene Mavroyannis
Title: Vice President
29
EXHIBIT A
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
INSTRUCTION TO DTC PARTICIPANTS
(Date of Mailing)
URGENT - IMMEDIATE ATTENTION REQUESTED
DEADLINE FOR RESPONSE: [DATE](a)
The Depository Trust Issuers ("DTC") has identified you as a DTC
Participant through which beneficial interests in the Charter Communications
Holdings, LLC (the "Company") and Charter Communications Holdings Capital
Corporation ("Charter Capital" and, together with the Company, the "Issuers")
11.7500% Senior Discount Notes due 2011 (the "Notes") are held.
The Issuers are in the process of registering the Notes under the
Securities Act of 1933, as amended, for resale by the beneficial owners thereof.
In order to have their Notes included in the registration statement, beneficial
owners must complete and return the enclosed Notice of Registration Statement
and Selling Securityholder Questionnaire.
It is important that beneficial owners of the Notes receive a copy of
the enclosed materials as soon as possible as their rights to have the Notes
included in the registration statement depend upon their returning the Notice
and Questionnaire by [Deadline For Response]. Please forward a copy of the
enclosed documents to each beneficial owner that holds interests in the Notes
through you. If you require more copies of the enclosed materials or have any
questions pertaining to this matter, please contact the Issuers c/o Charter
Communications Holdings, LLC, 12444 Powerscourt Drive, Suite 100, St. Louis,
Missouri, 63131, Attention: Secretary.
(a) Not less than 28 calendar days from date of mailing.
A-1
CHARTER COMMUNICATIONS HOLDINGS, LLC
CHARTER COMMUNICATIONS HOLDINGS CAPITAL CORPORATION
Notice of Registration Statement
and
Selling Securityholder Questionnaire
------------------------------------
(Date)
Reference is hereby made to the Exchange and Registration Rights
Agreement (the "Exchange and Registration Rights Agreement") between Charter
Communications Holdings, LLC and Charter Communications Holdings Capital
Corporation (together, the "Issuers"), and the Purchasers named therein.
Pursuant to the Exchange and Registration Rights Agreement, the Issuers have
filed with the United States Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (the "Shelf Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities Act"), of the Issuers' 11.750% Senior
Discount Notes due 2011 (the "Notes"). A copy of the Exchange and Registration
Rights Agreement is attached hereto. All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Exchange and Registration
Rights Agreement.
Each beneficial owner of Registrable Securities is entitled to have the
Registrable Securities beneficially owned by it included in the Shelf
Registration Statement. In order to have Registrable Securities included in the
Shelf Registration Statement, this Notice of Registration Statement and Selling
Securityholder Questionnaire ("Notice and Questionnaire") must be completed,
executed and delivered to the Issuers' counsel at the address set forth herein
for receipt ON OR BEFORE [Deadline for Response]. Beneficial owners of
Registrable Securities who do not complete, execute and return this Notice and
Questionnaire by such date (i) will not be named as selling securityholders in
the Shelf Registration Statement and (ii) may not use the Prospectus forming a
part thereof for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Shelf Registration
Statement and related prospectus.
A-2
ELECTION
The undersigned holder (the "Selling Securityholder") of Registrable
Securities hereby elects to include in the Shelf Registration Statement the
Registrable Securities beneficially owned by it and listed below in Item (3).
The undersigned, by signing and returning this Notice and Questionnaire, agrees
to be bound with respect to such Registrable Securities by the terms and
conditions of this Notice and Questionnaire and the Exchange and Registration
Rights Agreement, including, without limitation, Section 6 of the Exchange and
Registration Rights Agreement, as if the undersigned Selling Securityholder were
an original party thereto.
Upon any sale of Registrable Securities pursuant to the Shelf
Registration Statement, the Selling Securityholder will be required to deliver
to the Issuers and the Trustee the Notice of Transfer set forth in Exhibit B to
the Exchange and Registration Rights Agreement.
The Selling Securityholder hereby provides the following information to
the Issuers and represents and warrants that such information is accurate and
complete:
QUESTIONNAIRE
(1) (a) Full Legal Name of Selling Securityholder:
(b) Full Legal Name of Registered Holder (if not the same as in (a)
above) of Registrable Securities Listed in Item (3) below:
(c) Full Legal Name of DTC Participant (if applicable and if not the
same as (b) above) Through Which Registrable Securities Listed in Item (3) below
are Held:
(2) Address for Notices to Selling Securityholder:
-------------------------------------
-------------------------------------
-------------------------------------
Telephone:
-------------------------------------
Fax:
-------------------------------------
Contact Person:
-------------------------------------
A-3
(3) Beneficial Ownership of Notes:
Except as set forth below in this Item (3), the undersigned does not
beneficially own any Notes.
(a) Principal amount of Registrable Securities beneficially owned:
---------------------------------------------------------------
CUSIP No(s). of such Registrable Securities:
----------------------------
(b) Principal amount of Notes other than Registrable Securities
beneficially owned:
-------------------------------------
CUSIP No(s). of such other Notes:
-------------------------
(c) Principal amount of Registrable Securities which the undersigned
wishes to be included in the Shelf Registration Statement:
-----------------
CUSIP No(s). of such Registrable Securities to be included in the
Shelf Registration Statement:
------------------------------------------
(4) Beneficial Ownership of Other Securities of the Issuers:
Except as set forth below in this Item (4), the undersigned Selling
Securityholder is not the beneficial or registered owner of any other
securities of the Issuers other than the Notes listed above in Item (3).
State any exceptions here:
(5) Relationships with the Issuers:
Except as set forth below, neither the Selling Securityholder nor any of
its affiliates, officers, directors or principal equity holders (5% or
more) has held any position or office or has had any other material
relationship with the Issuers (or their respective predecessors or
affiliates) during the past three years.
State any exceptions here:
(6) Plan of Distribution:
A-4
Except as set forth below, the undersigned Selling Securityholder
intends to distribute the Registrable Securities listed above in Item
(3) only as follows (if at all): Such Registrable Securities may be sold
from time to time directly by the undersigned Selling Securityholder or,
alternatively, through underwriters, broker-dealers or agents. Such
Registrable Securities may be sold in one or more transactions at fixed
prices, at prevailing market prices at the time of sale, at varying
prices determined at the time of sale, or at negotiated prices. Such
sales may be effected in transactions (which may involve crosses or
block transactions) (i) on any national securities exchange or quotation
service on which the Registered Notes may be listed or quoted at the
time of sale, (ii) in the over-the-counter market, (iii) in transactions
otherwise than on such exchanges or services or in the over-the-counter
market, or (iv) through the writing of options. In connection with sales
of the Registrable Securities or otherwise, the Selling Securityholder
may enter into hedging transactions with broker-dealers, which may in
turn engage in short sales of the Registrable Securities in the course
of hedging the positions they assume. The Selling Securityholder may
also sell Registrable Securities short and deliver Registrable
Securities to close out such short positions, or loan or pledge
Registrable Securities to broker-dealers that in turn may sell such
Notes.
State any exceptions here:
By signing below, the Selling Securityholder acknowledges that it understands
its obligation to comply, and agrees that it will comply, with the provisions of
the Exchange Act and the rules and regulations thereunder, particularly
Regulation M.
In the event that the Selling Securityholder transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Issuers, the Selling Securityholder agrees to
notify the transferee(s) at the time of the transfer of its rights and
obligations under this Notice and Questionnaire and the Exchange and
Registration Rights Agreement.
By signing below, the Selling Securityholder consents to the disclosure of the
information contained herein in its answers to Items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and
related Prospectus. The Selling Securityholder understands that such information
will be relied upon by the Issuers in connection with the preparation of the
Shelf Registration Statement and related Prospectus.
In accordance with the Selling Securityholder's obligation under Section 3(d) of
the Exchange and Registration Rights Agreement to provide such information as
may be required by law for inclusion in the Shelf Registration Statement, the
Selling Securityholder agrees to promptly notify the Issuers of any inaccuracies
or changes in the
A-5
information provided herein which may occur subsequent to the date hereof at any
time while the Shelf Registration Statement remains in effect. All notices
hereunder and pursuant to the Exchange and Registration Rights Agreement shall
be made in writing, by hand-delivery, first-class mail, or air courier
guaranteeing overnight delivery as follows:
(i) To the Issuers:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
(ii) With a copy to:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
Once this Notice and Questionnaire is executed by the Selling Securityholder and
received by the Issuers' counsel, the terms of this Notice and Questionnaire,
and the representations and warranties contained herein, shall be binding on,
shall inure to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives, and assigns of the Issuers and the
Selling Securityholder (with respect to the Registrable Securities beneficially
owned by such Selling Securityholder and listed in Item (3) above). This
Agreement shall be governed in all respects by the laws of the State of New York
without giving effect to any provisions relating to conflicts of laws.
A-6
IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.
Dated:
----------------------------
--------------------------------------------------------------
Selling Securityholder
(Print/type full legal name of beneficial owner of Registrable
Securities)
By
------------------------------------------------------------
Name:
Title:
A-7
PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON
OR BEFORE [DEADLINE FOR RESPONSE] TO THE ISSUERS' COUNSEL AT:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
A-8
EXHIBIT B
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
BNY Midwest Trust Company
Charter Communications Holdings, LLC
Charter Communications Holdings Capital
Corporation
c/o BNY Midwest Trust Company
2 N. LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Trust Officer
Re: Charter Communications Holdings, LLC
and Charter Communications Holdings Capital Corporation
(together, the "Issuers") 11.750% Senior Discount Notes due 2011
Dear Sirs:
Please be advised that ______________ has transferred $__________ aggregate
principal amount of the above-referenced Notes pursuant to an effective
Registration Statement on Form S-3 (File No. 333-____) filed by the Issuers.
We hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933, as amended, have been satisfied and that the above-named
beneficial owner of the Notes is named as a "Selling Holder" in the prospectus
dated [date] or in supplements thereto, and that the aggregate principal amount
of the Notes transferred are the Notes listed in such prospectus opposite such
owner's name.
Dated:
Very truly yours,
----------------------------------
(Name)
By:
-------------------------------
(Authorized Signature)
B-1
Exhibit 99.1
Charter Communications Closes Class A Common Stock and Convertible Senior Notes
Offerings; "Greenshoe" Options Also Exercised For Total Proceeds of $1.9 Billion
ST. LOUIS--(BUSINESS WIRE)--May 30, 2001
Charter Communications, Inc. (Nasdaq:CHTR) today announced the closing of its
issuance of approximately 60.2 million shares of Class A common stock, and
$632.5 million of Convertible Senior Notes due 2006 (the "Notes"). The offerings
were first announced in a press release May 15, 2001. The issuances included
approximately 7.9 million Class A common shares and $82.5 million of Notes
issued pursuant to over-allotment, or "greenshoe" options granted to the
underwriters of the offerings.
The shares of Class A common stock were issued at $21 per share for proceeds of
approximately $1.27 billion. The $632.5 in Notes have an annual interest rate of
4.75%, payable semi-annually, and will be convertible into Class A common stock
at a conversion price of $26.25 per share. Total proceeds of approximately $1.9
billion exceeded the original $1.75 billion sought.
The net proceeds of the Class A common stock and Notes offerings are expected to
be used to pay the portion of the purchase price for the acquisition of AT&T
Broadband cable systems that was originally to be paid in Charter Class A common
stock. That transaction was announced February 2001. The remaining net proceeds
of these offerings are expected to be used for working capital purposes and
capital expenditures.
This press release shall not constitute an offer to sell or the solicitation of
an offer to buy, nor shall there be any offer or sale of the Class A common
stock or the Notes in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such jurisdiction.
With nearly 6.4 million customers in 40 states, Charter Communications, a Wired
World Company(TM), is among the nation's largest broadband communications
companies. Charter provides a full range of advanced broadband services to the
home, including cable television on an advanced digital video programming
platform, marketed under the Charter Digital Cable(TM) brand; and high-speed
Internet access marketed under the Charter Pipeline(TM) brand. Commercial
high-speed data, video and Internet solutions are provided under the Charter
Business Networks(TM) brand. Advertising sales and production services are sold
under the Charter Media(TM) brand.
Statements in this press release regarding Charter Communications' business that
are not historical facts may be "forward-looking statements." Forward-looking
statements are inherently subject to risks, uncertainties and assumptions.
Important factors that could cause actual results to differ materially from any
such forward-looking statements are identified in the reports and documents
Charter files from time to time with the U.S. Securities and Exchange
Commission.
Exhibit 99.2
Charter Communications to Issue $1.5 Billion Senior and Senior Discount Notes;
Proceeds Increase From $1 Billion Originally Sought
ST. LOUIS--(BUSINESS WIRE)--May 10, 2001--Charter Communications Holdings, LLC
and Charter Communications Holdings Capital Corporation, subsidiaries of Charter
Communications, Inc. (Nasdaq: CHTR), today announced they had entered into an
agreement to sell $350 million of 9.625% Senior Notes due 2009, $575 million of
10% Senior Notes due 2011 and $575.2 million of 11.75% Senior Discount Notes due
2011 with a principal at maturity of $1.02 billion (the "Notes"). The sale of
the Notes will provide gross proceeds to the issuers of approximately $1.5
billion.
The net proceeds of this issuance will be used to pay the cash portion of the
purchase price for the acquisition of certain cable systems from AT&T Broadband
announced in February 2001, with the remaining portion for working capital
purposes. The offering is expected to close on May 15, 2001.
The Notes are being sold to qualified institutional buyers in reliance on Rule
144A. The Notes will not be registered under the Securities Act of 1933, as
amended (the "Securities Act"), and, unless so registered, may not be offered or
sold in the United States except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
and applicable state securities laws. This press release shall not constitute an
offer to sell or the solicitation of an offer to buy, nor shall there be any
sale of the Notes in any state in which such offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws of
any such state.
Charter Communications, a Wired World(TM) company, is among the nation's largest
broadband communications companies, currently serving some 6.4 million customers
in 40 states. Charter provides a full range of advanced broadband services to
the home, including cable television under the Charter Cable TV brand; advanced
digital video programming services under the Charter Digital Cable(TM) brand;
and high-speed Internet access via Charter Pipeline(TM). Commercial high-speed
data, video and Internet solutions are provided under the Charter Business
NetworksTM brand. Advertising sales and production services are sold under the
Charter MediaTM brand.
More information about Charter can be found at www.charter.com.
Statements in this press release regarding Charter Communications' business that
are not historical facts may be "forward-looking statements." Forward-looking
statements are inherently subject to risks, uncertainties and assumptions.
Important factors that could cause actual results to differ materially from any
such forward-looking statements are identified in the reports and documents
Charter files from time to time with the U.S. Securities and Exchange
Commission.
CONTACT: Charter Communications
Media
Anita Lamont, 314/543-2215
alamont@chartercom.com
or
Analyst
Mary Jo Moehle, 314/543-2397
mmoehle@chartercom.com