EXHIBIT 1.2
TCI COMMUNICATIONS, INC.
MEDIUM-TERM NOTES, SERIES D
DISTRIBUTION AGREEMENT
February 24, 1998
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx, 00xx Xxxxx
World Financial Center
Xxx Xxxx, Xxx Xxxx 00000-0000
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Brothers Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Salomon Brothers Inc
Xxxxx Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
TCI Communications, Inc., a company duly incorporated under the laws of the
State of Delaware (the "Company"), confirms its agreement with Xxxxxxx Xxxxx &
Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Credit Suisse First
Boston Corporation, Xxxxxx Brothers Inc. and Salomon Brothers Inc (each, an
"Agent" and, collectively, the "Agents") with respect to the issue and sale by
the Company of Medium-Term Notes, Series D, described herein (the "Notes").
The Notes are to be issued pursuant to an indenture, dated as of February 19,
1998 (the "Indenture"), between the Company and The Bank of New York, as
trustee (the "Trustee"). Securities issued or to be issued under the
Indenture, including the Notes, are herein called "Securities".
As of the date hereof, the Company has authorized the issuance and sale of
up to U.S. $750,000,000 aggregate principal amount of Notes through or to the
Agents pursuant to the terms of this Agreement. It is understood, however,
that the Company may from time to time authorize the issuance of additional
Notes and that such additional Notes may be sold through or to the Agents
pursuant to the terms of this Agreement, all as though the issuance of such
Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company directly
to purchasers, in which case an Agent will act as an agent of the Company in
soliciting Note purchases, and (as may from time to time be agreed to by the
Company and an Agent) to an Agent as principal for resale to purchasers.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-44745) relating
to, among other things, the Securities and the offering thereof from time to
time in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "1933 Act"), and has filed such amendments thereto as may have been
required to the date hereof. Such registration statement, as amended, has been
declared effective by the Commission, and the Indenture has been qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement, as amended as of each
respective Representation Date (as herein defined) (and any further
registration statements which may be filed by the Company for the purpose of
registering additional Notes), and the prospectus and prospectus supplement
relating to the Notes constituting a part thereof as amended and supplemented
as of each respective Representation Date, including in each case all
documents incorporated therein by reference and all exhibits thereto, as from
time to time amended or supplemented pursuant to the Securities Exchange Act
of 1934, as amended (the "1934 Act"), the 1933 Act or otherwise, are referred
to herein as the "Registration Statement" and the "Prospectus", respectively,
except that if any revised prospectus shall be provided to the Agents or any
of them by the Company for use in connection with the offering of the Notes
which is not required to be filed by the Company pursuant to Rule 424(b) under
the 1933 Act, the term "Prospectus" shall refer to such revised prospectus and
prospectus supplement from and after the time it is first provided to the
Agents or any of them for such use.
Section 1. Appointment as Agents.
(a) Appointment of Agents. Subject to the terms and conditions stated
herein, the Company hereby appoints each of the Agents as agent of the Company
for the purpose of soliciting purchases of the Notes from the Company by
others and agrees that, except as otherwise contemplated herein, whenever the
Company determines to sell Notes directly to an Agent as principal for resale
to others, the Agent will enter into a Terms Agreement with the Company
(hereafter defined) relating to such sale in accordance with the provisions of
Section 3(b) hereof. Each Agent is authorized to engage the services of any
other broker or dealer in connection with the offer or sale of the Notes
purchased by the Agent as principal for resale to others but is not authorized
to appoint sub-agents. The Company may, from time to time, offer Notes for
sale otherwise than through an Agent; provided, however, that so long as this
Agreement shall be in effect the Company shall not solicit or accept offers to
purchase Notes through any agent other than an Agent, unless such agent shall
have entered into an agreement with the Company substantially similar to this
Agreement (including, but not limited to, Schedule A hereto). Written notice
of such agreement shall be given to the Agents within one day of the execution
thereof. In addition, the Company shall have the right at any time or from
time to time to sell Notes directly to investors.
(b) Reasonable Best Efforts Solicitations; Right to Reject Offers. Upon
receipt of instructions from the Company, each Agent will use its reasonable
best efforts to solicit purchases of such principal amount of the Notes as the
Company and the Agents shall agree upon from time to time during the term of
this Agreement, it being understood that the Company from time to time may
allocate or reallocate the Notes which are to be sold by any Agent and that
the Company shall not approve the solicitation of purchases of Notes in excess
of the principal amount of Securities registered pursuant to the Registration
Statement that from time to time remain unsold. The Agents will have no
responsibility for maintaining records with respect to the aggregate principal
amount of Notes sold, or of otherwise monitoring the availability of Notes for
sale under the Registration Statement. Each Agent will communicate to the
Company, orally or in writing, each reasonable offer to purchase Notes. Each
Agent shall have the right, in its discretion reasonably exercised, to reject
any proposed purchase of Notes, as a whole or in part, and any such rejection
shall not be deemed a breach of the Agent's agreement contained herein. The
Company shall have the sole right to accept any offers to purchase the Notes
and may reject in its sole discretion any proposed purchase of the Notes, in
whole or in part.
(c) Solicitations as Agent; Purchases as Principal. In soliciting purchases
of the Notes on behalf of the Company, each Agent shall act solely as agent
for the Company and not as principal. Each Agent shall make reasonable best
efforts to assist the Company in obtaining performance by each purchaser whose
offer to purchase Notes has been solicited by the Agent and accepted by the
Company. No Agent shall have any obligation to purchase Notes from the Company
as principal, but an Agent may agree from time to time to purchase Notes as
principal. Any such purchase of Notes by an Agent as principal shall be made
pursuant to a Terms Agreement in accordance with Section 3(b) hereof.
(d) Reliance. The Company and each Agent agree that any Notes the placement
of which an Agent arranges shall be placed by the Agent, and any Notes
purchased by an Agent shall be purchased by such Agent, in reliance on the
representations, warranties, covenants and agreements of the Company contained
herein and
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on the terms and conditions and in the manner provided herein, in the
Prospectus and in the Administrative Procedures (as defined in Section 3(c)).
Section 2. Representations and Warranties.
The Company represents and warrants to each Agent as of the date hereof, as
of the date of each acceptance by the Company of an offer for the purchase of
Notes (whether through an Agent as agent or to an Agent as principal), as of
the date of each delivery of Notes (whether through an Agent as agent or to an
Agent as principal) (the date and time of each such delivery to an Agent as
principal being hereafter referred to as a "Settlement Time"), and as of any
time that the Registration Statement or the Prospectus shall be amended or
supplemented (other than by an amendment or supplement (i) providing solely
for the specification of or a change in the interest rates, maturities,
pricing or other similar terms of any Notes or a change in the principal
amount of Notes remaining to be sold or similar changes (each an "Excluded
Supplement") or (ii) relating to an offering of Securities other than the
Notes) or that there is filed with the Commission any document incorporated by
reference into the Prospectus (other than any Current Report on Form 8-K
relating exclusively to the issuance of Securities other than the Notes under
the Registration Statement) (each of the dates or times referenced above being
referred to herein as a "Representation Date") as follows:
(a) Incorporated Documents. The documents incorporated by reference in
the Registration Statement and the Prospectus, when they were filed (or, if
an amendment with respect to any such document was filed, when such
amendment was filed) with the Commission, conformed in all material
respects to the requirements of the 1934 Act and the rules and regulations
of the Commission promulgated thereunder (the "1934 Act Regulations"), and
any further documents so filed and incorporated by reference will, when
they are filed with the Commission, conform in all material respects to the
requirements of the 1934 Act and the 1934 Act Regulations; none of such
documents, when it was filed (or, if an amendment with respect to any such
document was filed, when such amendment was filed), 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, in light
of the circumstances under which they were made, not misleading; and no
such further document, when it is filed, will contain an untrue statement
of a material fact or will omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading.
(b) Registration Statement and Prospectus. The Registration Statement and
the Prospectus, at the time the Registration Statement became effective,
complied, and the Registration Statement and Prospectus, as then amended or
supplemented as of each Representation Date, will comply in all material
respects with the 1933 Act and the rules and regulations of the Commission
thereunder (the "1933 Act Regulations") and the Indenture complies in all
material respects with the requirements of the 1939 Act and the rules and
regulations of the Commission thereunder (the "1939 Act Regulations"). The
Registration Statement, at the time the Registration Statement became
effective (or, if an amendment to the Registration Statement or an annual
report on Form 10-K of the Company incorporated by reference into the
Prospectus has been filed with the Commission subsequent to the
effectiveness of the Registration Statement, then at the time of the most
recent such filing) and as then amended or supplemented as of each
Representation Date, did not 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. The
Prospectus, at the time the Registration Statement became effective and as
then amended or supplemented as of each Representation Date, did not and
will not 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 the representations and warranties in this
subsection shall not apply (i) with respect to an Agent, to statements or
omissions from the Registration Statement or Prospectus made in reliance
upon and in conformity with information furnished to the Company by or on
behalf of such Agent expressly for use in the Registration Statement or
Prospectus or (ii) to that part of the Registration Statement which shall
constitute the Statement of Eligibility under the 1939 Act (Form T-1) of
the Trustee under the Indenture.
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(c) The Notes and The Indenture. The Notes and the Indenture have been
duly authorized by the Company and conform to the descriptions thereof in
the Prospectus.
(d) No Defaults. The issuance and sale of the Notes and the fulfillment
of the terms of this Agreement will not result in a breach of any of the
terms or provisions of, or constitute a default under, (i) the Company's
charter or bylaws, (ii) any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company or any of its Significant
Subsidiaries (as such term is defined in Rule 1.02(w) of Regulation S-X) is
now a party or by which it is bound which would have a material adverse
effect on the conduct of the business of the Company and its consolidated
subsidiaries considered as one enterprise, or (iii) any order of any court
or governmental agency or authority entered in any proceeding to which the
Company or any of its Significant Subsidiaries was or is now a party or by
which it is bound.
(e) Accountants. KPMG Peat Marwick LLP, the Company's auditors, or its
successor are independent accountants as required by the 1933 Act.
(f) 1934 Act Filings. So long as may be required for the distribution of
the Notes by the Agents or by any dealers that participate in the
distribution thereof, the Company will comply with all requirements under
the 1934 Act relating to the timely filing with the Commission of its
reports pursuant to Section 13(a) and (c) of the 1934 Act and of its proxy
statements pursuant to Section 14 of the 1934 Act.
(g) Operating Permits, Certificates, etc. Except to the extent set forth
in the Prospectus, the Company has not received any notice of, nor does it
have any actual knowledge of, any failure by it or any of its Significant
Subsidiaries to be in substantial compliance with all material existing
statutes and regulations applicable to it or such Significant Subsidiaries,
which failure would materially and adversely affect the conduct of the
business of the Company and its consolidated subsidiaries considered as one
enterprise.
Any certificate required hereby, signed by any executive officer of the
Company or Assistant Treasurer and delivered to an Agent or counsel for the
Agents, shall be deemed a representation and warranty by the Company as to the
matters covered thereby.
Section 3. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein
set forth, each Agent agrees, as an agent of the Company, to use its
reasonable best efforts to solicit offers to purchase the Notes upon the terms
and conditions set forth herein, in the Prospectus and in the Administrative
Procedures.
The Company reserves the right, in its sole discretion, to (i) suspend
solicitation of purchases of the Notes through the Agents, in each case as
agent, commencing at any time for any period of time or permanently, and (ii)
allocate or reallocate the Notes which are to be sold by any Agent. Upon
receipt of instructions from the Company, each Agent receiving such
instructions will forthwith suspend solicitation of purchases from the Company
until such time as the Company has advised said Agent that such solicitation
may be resumed.
The Company agrees to pay each Agent a commission with respect to each
consummation of the sale of a Note by the Company as a result of a
solicitation made by such Agent, in the form of a discount, equal to the
applicable percentage as set forth in Schedule A hereto of the principal
amount of such Note or, in the case of an Original Issue Discount Note (as
defined in the Prospectus), of the Issue Price (as defined in the Prospectus)
of such Note.
The purchase price, interest rate, maturity date and other terms of the
Notes in connection with each sale of Notes to or through an Agent shall be
agreed upon by the Company and the Agent and set forth in a pricing supplement
to the Prospectus to be prepared following each acceptance by the Company of
an offer for the purchase of Notes. Except as may be otherwise provided in
such supplement to the Prospectus, the Notes will be
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issued in denominations of $1,000 or an integral multiple of $1,000. All Notes
sold through an Agent as agent will be sold at 100% of their principal amount
unless otherwise agreed to by the Company and the Agent.
(b) Purchases as Principal. Each sale of Notes to an Agent as principal
shall be made in accordance with the terms contained herein and (unless the
Company and such Agent shall otherwise agree in writing) only pursuant to a
separate agreement which shall provide for the sale of such Notes to, and the
purchase and reoffering thereof by, such Agent. Each such separate agreement
(which may be an oral agreement, confirmed in writing which may be a facsimile
transmission) between an Agent and the Company is herein referred to as a
"Terms Agreement". Unless the context otherwise requires, each reference
contained herein to "this Agreement" shall be deemed to include any applicable
Terms Agreement between the Company and an Agent. Each such Terms Agreement,
whether oral, (confirmed in writing, which may be a facsimile transmission),
or in writing, shall be with respect to such information (as applicable) as is
specified in Exhibit A hereto. An Agent's commitment to purchase Notes as
principal pursuant to any Terms Agreement shall be deemed to have been made on
the basis of the representations and warranties of the Company herein
contained and shall be subject to the terms and conditions herein set forth.
Each Terms Agreement with an Agent shall specify the principal amount of Notes
to be purchased by the Agent pursuant thereto, the price to be paid to the
Company for such Notes (which shall be at a discount equivalent to the
applicable commission set forth in Schedule A hereto unless otherwise
specified in an applicable Terms Agreement), the Settlement Time and place of
delivery of and payment for such Notes, any provisions relating to rights of,
and default by, purchasers acting together with the Agent in the reoffering of
the Notes, and such other provisions (including further terms of the Notes) as
may be mutually agreed upon. Each Agent may utilize a selling or dealer group
in connection with the resale of the Notes purchased. The Terms Agreement
shall also specify the requirements for the officer's certificate, opinions of
counsel and comfort letter pursuant to Sections 7(b), 7(c) and 7(d) hereof
and, if applicable, the period of time referred to in Section 4(g). With
respect to any Notes purchased by an Agent as principal pursuant to a Terms
Agreement that have not been resold by such Agent prior to the earlier of (i)
the 90th day following the related Settlement Time and (ii) a date specified
in an applicable Terms Agreement, such Agent agrees (and by entering into such
Terms Agreement shall be deemed to have reconfirmed such agreement) that upon
receipt of written notice from the Company of its intention to bid for or
purchase any Notes or any security of the same class and series as the Notes
or to take any other action, directly or indirectly, the taking of which would
be proscribed by Regulation M under the 1934 Act (or any successor or
equivalent rule or regulation) during the reoffering of the Notes, such Agent
will, and will cause any selling or dealer group utilized by it in connection
with such reoffering to, cease reoffering such Notes for such period of time
as the Company may deem necessary so that the action or actions proposed to be
taken, directly or indirectly, by it may be taken in full compliance with such
Regulation (or any successor or equivalent rule or regulation).
(c) Administrative Procedures. Administrative procedures with respect to the
sale of Notes shall be agreed upon from time to time by the Agents and the
Company (the "Administrative Procedures"). The Agents and the Company agree to
perform the respective duties and obligations specifically provided to be
performed by them in the Administrative Procedures.
Section 4. Covenants of the Company. The Company covenants with each Agent as
follows:
(a) Notice of Certain Events. Prior to the termination of the offering of
the Notes, the Company will notify the Agents promptly, and (if requested
by the Agents in writing) will confirm such advice in writing, (1) of the
effectiveness of any amendment to the Registration Statement and of the
filing of any supplement to the Prospectus (other than an Excluded
Supplement or an amendment or supplement providing solely for the inclusion
of additional financial information, and, unless the Agents shall otherwise
specify, an amendment or supplement which relates exclusively to an
offering of Securities other than the Notes), (2) of any comments of the
Commission regarding the Registration Statement or the Prospectus (or any
of the documents incorporated by reference therein) or of any request by
the Commission for amendments or supplements to the Registration Statement
or the Prospectus or for additional information, (3) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or
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the initiation or threatening of any proceedings for that purpose, (4) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Notes for offer or sale in any
jurisdiction or the initiation or threatening of any proceedings for such
purpose and (5) of the happening of any event during the period mentioned
in paragraph (d) below which makes any statement of a material fact made in
the Registration Statement or the Prospectus untrue or which requires the
making of any changes in the Registration Statement or the Prospectus in
order to make the statements therein, in light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading. Upon receipt of
notice of an event described in (3), (4) or (5) above, the Agents shall
cease solicitations of offers to purchase the Notes, as agent, and cease
sales of Notes the Agents may own as principal; provided, however, that if
such cessation arises out of an event described in (4) above, it shall be
limited to cessation of solicitation of offers to purchase and sales in the
jurisdiction or jurisdictions identified in such notice. The Company will
use its reasonable best efforts to prevent the issuance of any order
suspending the effectiveness of the Registration Statement or suspending
the qualification of the Notes for offer or sale in any jurisdiction, and
if any such order is issued, the Company will make every reasonable effort
to obtain the withdrawal of such order at the earliest possible moment.
(b) Registration Statement. The Company will furnish to each of the
Agents, without charge, one copy of the Registration Statement (which may
be conformed) and any post-effective amendment thereto, including all
financial statements and schedules, exhibits and documents incorporated
therein by reference (including exhibits incorporated therein by reference
to the extent not previously furnished to the Agents).
(c) Notice of Certain Proposed Filings. Prior to the termination of the
offering of the Notes, the Company will not file any amendment or
supplement to the Registration Statement or the Prospectus (except for (i)
periodic or current reports filed under the 1934 Act, (ii) an Excluded
Supplement, or (iii) a supplement relating to an offering of Securities
other than the Notes) unless the Company has furnished each Agent a copy
for its review prior to filing such proposed amendment or supplement.
(d) Copies; Revisions of Prospectus--Material Changes. During the period
of time that the Prospectus is required by law to be delivered, the Company
will deliver to the Agents, without charge, as many copies of the
Prospectus, as amended or supplemented, as the Agents may reasonably
request. The Company consents to the use of the then current Prospectus, as
amended or supplemented, by the Agents in connection with the offering or
sale of the Notes and for such period of time thereafter as the Prospectus
is required by law to be delivered in connection therewith. If during such
period of time, any event shall occur which in the judgment of the Company
should be set forth (or incorporated by reference) in the Prospectus in
order to make the statements therein, in light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to supplement the Prospectus or amend the Registration Statement
to comply with law, immediate notice shall be given by the Company, and
confirmed in writing, to the Agents to cease the solicitation of offers to
purchase the Notes in the Agents' capacity as agents and to cease sales of
any Notes the Agents may then own as principals pursuant to a Terms
Agreement (and, if so notified by the Company, each Agent shall forthwith
cease such solicitations and sales), and the Company will forthwith prepare
and duly file with the Commission an appropriate supplement or amendment
thereto, and forthwith file all reports and any definitive proxy statement
or information statement required to be filed by the Company with the
Commission pursuant to Sections 13(a), 13(c) or 14 of the 1934 Act
subsequent to the date of the Prospectus, and will deliver to the Agents,
without charge, such number of copies thereof as they may reasonably
request. If during such period of time any event shall occur which in the
Agents' judgment should be so set forth (or incorporated by reference), in
the Prospectus, or which in the Agents' judgment makes it necessary to so
supplement or amend the Prospectus, the Company will consult with the
Agents concerning the necessity of filing with the Commission a supplement
to the Prospectus, an amendment to the Registration Statement or a report
pursuant to Sections 13(a), 13(c) or 14 of the 1934 Act.
(e) Blue Sky. Prior to any public offering of the Notes by the Agents,
the Company will cooperate with the Agents and counsel for the Agents in
connection with the registration or qualification of the Notes for offer
and sale under the securities or Blue Sky laws of, and the determination of
the eligibility of the
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Notes for investment under the laws of, such jurisdictions as the Agents
request (to the extent the Agents determine such actions are required by
applicable law or are otherwise desirable); provided, that in no event
shall the Company be obligated to qualify to do business as a foreign
corporation or as a securities dealer in any jurisdiction where it is not
now so qualified, to conform its capitalization or the composition of its
assets to the securities or Blue Sky laws of any jurisdiction or to take
any action which would subject it to taxation or general service of process
in any jurisdiction where it is not now so subject. The Company will pay
all reasonable fees and expenses (including reasonable counsel fees and
expenses) relating to qualification of the Notes under such securities or
Blue Sky laws and in connection with the determination of the eligibility
of the Notes for investment under the laws of such jurisdictions as the
Agents may designate.
(f) Earnings Statements. The Company will make generally available to its
security holders and to the Agents consolidated earnings statements (which
need not be audited) that satisfy the provisions of Section 11(a) of the
1933 Act and Rule 158 thereunder.
(g) Stand-Off Agreement. Between the date of any Terms Agreement and the
Settlement Time or such other time as is specified in the Terms Agreement,
the Company will not offer or sell, or contract to sell, any debt
securities of the Company substantially similar to those issued pursuant to
the Terms Agreement, which may include substantially similar Notes,
pursuant to a public offering of such similar debt securities without the
prior written consent of the Agent party to such Terms Agreement, which
shall not be unreasonably withheld.
(h) Preparation of Pricing Supplements. The Company will prepare, with
respect to each Note to be sold through or to an Agent pursuant to this
Agreement, a pricing supplement with respect to such Notes in a general
form previously approved by the Agents, and will file such pricing
supplement pursuant to the applicable paragraph of Rule 424(b) under the
1933 Act within the time period therein prescribed.
(i) Suspension of Certain Obligations. The Company shall not be required
to comply with the provisions of subsections (b), (c) or (d) of this
Section during any period from the time (i) any Agent shall have suspended
solicitation of purchases of the Notes in its capacity as agent pursuant to
a request from the Company and (ii) any Agent shall not then hold any Notes
as a principal, purchased pursuant to a Terms Agreement, to the time the
Company shall determine that solicitation of purchases of the Notes should
be resumed or shall subsequently enter into a new Terms Agreement with an
Agent.
Section 5. Conditions of Obligations. The obligations of each Agent to solicit
offers to purchase the Notes as agent of the Company, the obligations of any
purchasers of the Notes sold through an Agent as agent, and any obligation of
an Agent to purchase Notes pursuant to a Terms Agreement will be subject to
the accuracy of the representations and warranties on the part of the Company
contained in Section 2 hereof and in any certificate furnished pursuant to the
provisions hereof, to the performance and observance by the Company of all of
its covenants and agreements herein contained and to the following additional
conditions precedent:
(a) Legal Opinions. On the date hereof, the Agents shall have received:
(1) The favorable opinions, dated as of the date hereof, from (A) special
communications counsel for the Company with respect to matters of
communications law, and (B) General Counsel of the Company, in form and
substance satisfactory to the Agents, to the effect that:
(i) the Company and each of its Significant Subsidiaries is a
corporation duly incorporated, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has the
corporate power and authority to carry on its business as described in
the Prospectus and the Company has the corporate power and authority to
execute and deliver and perform its obligations under this Agreement
and to issue and sell the Notes as contemplated by this Agreement;
(ii) the Company and each of its Significant Subsidiaries is duly
qualified as a foreign corporation and is in good standing in each
jurisdiction in which the failure to so qualify would, in the
aggregate, have a material adverse effect upon the financial condition,
results of operations, business or properties of the Company and its
consolidated subsidiaries taken as a whole;
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(iii) all corporate proceedings legally required in connection with
the authorization and issuance of the Notes and the sale of the Notes
by the Company in accordance with the terms of this Agreement have been
taken;
(iv) to the best knowledge of such counsel, there is no legal or
governmental proceeding pending or threatened against the Company or
any of its subsidiaries which is required to be disclosed in the
Prospectus and is not so disclosed and correctly summarized therein;
(v) to the best knowledge of such counsel, there is no contract or
other document known to such counsel of a character required to be
described in the Prospectus or to be filed as an exhibit to the
Registration Statement (or to a document incorporated by reference
therein) that is not described or filed as required;
(vi) the execution and delivery of this Agreement and the Indenture,
the issuance of the Notes and the fulfillment of the terms herein and
therein contained do not conflict with, or result in a breach of, or
constitute a default under, the charter or by-laws of the Company or,
to the best knowledge of such counsel, conflict in any material respect
with, or result in a material breach of or constitute a material
default under any material agreement or other instrument known to such
counsel to which the Company or any of its Significant Subsidiaries is
a party or by which it is bound, or result in a violation of any law,
administrative regulation or court or governmental decree known to such
counsel applicable to the Company or any of its subsidiaries, except
that such counsel need not express any opinion with respect to (i)
matters opined upon by other special counsel to the Company or (ii) the
Blue Sky or securities laws of any jurisdiction; and
(vii) such counsel has no reason to believe that either the
Registration Statement or the Prospectus, as amended or supplemented,
if applicable (except as to financial statements and schedules and any
other financial and statistical data contained or incorporated by
reference in the Registration Statement or Prospectus, as to which no
opinion need be expressed), contained, as of the date the Prospectus
was first filed with the Commission pursuant to Rule 424 under the 1933
Act, or contains, as of the date hereof (or if such opinion is being
delivered in connection with a Terms Agreement pursuant to Section 7(c)
hereof, at the date of such Terms Agreement and at the Settlement Time
with regard thereto, as the case may be), any untrue statement of a
material fact or omitted or omits to state any material fact required
to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which
they were made) not misleading.
(2) The favorable opinion, dated as of the date hereof, from special
counsel to the Company, in form and substance satisfactory to the Agents,
to the effect that:
(i) the execution and delivery of this Agreement and the Indenture,
the issuance of the Notes and the fulfillment of the terms herein and
therein contained do not, to the best knowledge of such counsel, result
in a material breach of or constitute a material default under any
material agreement for borrowed money known to such counsel to which
the Company or any of its Significant Subsidiaries is a party or by
which it is bound, and
(ii) the Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, and is not subject to
regulation under such Act.
(3) The favorable opinion, dated as of the date hereof, from special
counsel to the Company, in form and substance satisfactory to the Agents,
to the effect that:
(i) this Agreement and the Indenture have been duly authorized,
executed and delivered by the Company; and the Indenture is a legal,
valid and binding agreement of the Company enforceable in accordance
with its terms, except (A) as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and other laws affecting creditors' rights generally,
8
and (B) that the remedy of specific performance and injunctive and
other forms of equitable relief are subject to certain equitable
defenses and to the discretion of the court before which any proceeding
therefor may be brought;
(ii) the Indenture has been duly qualified under, and complies in all
material respects with the requirements of, the 1939 Act;
(iii) the Notes, when executed by the Company, completed,
authenticated and delivered by the Trustee in accordance with the
Indenture, issued and delivered by the Company and paid for, all as
contemplated by and in accordance with the order of the Company, the
procedures specified therein and this Agreement, will be legal, valid
and binding obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms, except (A) as
such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and other laws
affecting creditors rights generally, and (B) that the remedy of
specific performance and injunctive and other forms of equitable relief
are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought;
(iv) the Registration Statement is effective under the 1933 Act and,
to the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened by the Commission;
and
(v) the Notes (subject to completion in accordance with the
applicable pricing supplement) and the Indenture conform in all
material respects as to legal matters to the descriptions thereof in
the Prospectus.
In addition, such counsel shall state that: "The Registration Statement and
the Prospectus (except as to (x) the financial statements and schedules and
any other financial and statistical data contained or incorporated by
reference therein and (y) the documents incorporated or deemed to be
incorporated by reference therein, as to which no opinion is expressed),
comply, as of the date hereof, as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations. In passing upon the
form of such documents, we have necessarily assumed the correctness and
completeness of the statements made or included therein by the Company and
take no responsibility for the accuracy, completeness or fairness of the
statements contained therein except insofar as such statements relate to the
description of the Notes and the Indenture or relate to us. However, we had
conferences with certain officers and other representatives of the Company,
and our examination of the Registration Statement and the Prospectus and our
discussions in such conferences did not disclose to us any information
(relying as to the materiality of any such information primarily upon officers
and other representatives of the Company) which gave us reason to believe that
either the Registration Statement or the Prospectus (except as to (x) the
financial statements and schedules and any other financial and statistical
data contained or incorporated by reference in the Registration Statement or
Prospectus and (y) the documents incorporated or deemed to be incorporated by
reference therein, as to which no opinion is expressed, and except as to the
terms of the particular Notes which are to be provided in a pricing
supplement), contains, as of the date hereof, any 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 (in the case of the
Prospectus, in light of the circumstances under which they were made) not
misleading."
In giving such opinions, such counsel may rely (x) as to matters of fact, to
the extent they deem proper, upon certificates of officers of the Company,
public officials and others, and (y) as to matters of law other than the
United States or Colorado (in the case of General Counsel of the Company) or
New York (in the case of special counsel to the Company), on the opinions of
local counsel retained by them or the Company, provided that such counsel are
satisfactory to the Agents and counsel for the Agents. In addition, it is
understood that the General Counsel of the Company may elect to provide
favorable opinions with respect to the matters set forth in clause (i) of
subsection (a)(2) of this Section and clause (iv) of subsection (a)(3) of this
Section in lieu of special counsel to the Company providing such opinions.
9
(4) The favorable opinion, dated as of the date hereof, of counsel for
the Agents, with respect to the matters set forth in clauses (i) and (iii)
of subsection (a)(3) of this Section and to the effect that the
Registration Statement and the Prospectus (except as to (x) the financial
statements and schedules and any other financial and statistical data
contained or incorporated by reference therein and (y) the documents
incorporated or deemed to be incorporated by reference therein, as to which
no opinion need be expressed) comply as to form in all material respects
with the 1933 Act. In addition, the Agents shall have received on the date
hereof from counsel for the Agents an opinion with respect to the
Registration Statement and the Prospectus in the form customarily given by
such firm.
(b) Material Changes; Officer's Certificates. On the date hereof there
shall not have been, since the respective dates as of which information is
given in the Registration Statement, any material adverse change or any
development resulting in the substantial possibility of a prospective
material adverse change in the condition, financial or otherwise, of the
Company and its consolidated subsidiaries considered as one enterprise, or
in the earnings or business affairs of the Company and its consolidated
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the Agents shall have received a
certificate of the President, the Principal Financial Officer, an Executive
Vice President or a Senior Vice President, the Treasurer or the Assistant
Treasurer of the Company, dated as of the date hereof, to the effect that
(i) there has been no such material adverse change with respect to the
Company and its consolidated subsidiaries considered as a whole, (ii) no
stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose are pending or threatened
by the Commission, (iii) the representations and warranties of the Company
contained in Section 2 are true and correct as of the date hereof, and (iv)
the Company has performed or complied with all agreements and satisfied all
conditions pursuant to this Agreement in connection with the issuance of
the Notes on its part to be performed or satisfied at or prior to the date
of such certificate.
(c) Comfort Letter. On the date hereof, the Agents shall have received
from KPMG Peat Marwick LLP or its successors or other independent certified
public accountants acceptable to the Agents, a letter, dated as of the date
hereof, in form and substance reasonably satisfactory to the Agents;
provided, that the delivery of such letter by KPMG Peat Marwick LLP (or its
successors) shall be conditioned upon the receipt by KPMG Peat Marwick LLP
(or its successors) of: (i) an opinion of counsel for the Agents, in form
and substance reasonably satisfactory to KPMG Peat Marwick LLP (or such
successor) to the effect that the Agents would be entitled to assert the
due diligence defense under the 1933 Act; or (ii) a representation letter
from the Agents addressed to KPMG Peat Marwick LLP in the form set forth as
Exhibit B hereto.
(d) Other Matters. At each Settlement Time with respect to any Terms
Agreement, counsel for the Agents shall have been furnished with such
documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Notes as therein
contemplated and related proceedings or in order to evidence the accuracy
and completeness of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained. All proceedings
taken by the Company in connection with the issuance and sale of the Notes
as herein contemplated shall be satisfactory in form and substance to the
Agents.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement (or, at the option of the
applicable Agent, any Terms Agreement) may be terminated by an Agent by notice
to the Company at any time (or, in the case of termination of a Terms
Agreement, at or at any time prior to the Settlement Time) and any such
termination shall be with the effect set forth in Section 12(c).
Section 6. Delivery of and Payment for Notes Sold through an Agent. Delivery
of Notes sold through an Agent as agent shall be made by the Company to the
Agent for the account of any purchaser only against payment therefor in
immediately available funds. In the event that a purchaser shall fail either
to accept delivery of, or to make payment for, a Note on the date fixed for
settlement, the Agent that solicited such purchaser shall promptly notify the
Company and deliver the Note to the Company, and, if the Agent has theretofore
paid the Company for such Note, the Company will return such funds to the
Agent within three business days. If such
10
failure occurred for any reason other than default by the Agent in the
performance of its obligations hereunder, the Company will reimburse the Agent
for its loss of the use of the funds for the period such funds were credited
to the Company's account. Such reimbursement shall be in an amount equal to
the lower of the Company's cost of funds and the Agent's cost of funds.
Section 7. Additional Covenants of the Company. The Company covenants and
agrees with the Agents that:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
it of an offer for the purchase of Notes, and each delivery of Notes to an
Agent pursuant to a Terms Agreement, shall be deemed to be an affirmation
that the representations and warranties of the Company contained in Section
2 of this Agreement and in any certificate theretofore delivered to such
Agent pursuant hereto are true and correct at the time of such acceptance
or sale, as the case may be, and an undertaking that such representations
and warranties will be true and correct at the time of delivery to the
purchaser or his agent, or to such Agent, of the Note or Notes relating to
such acceptance or sale, as the case may be, as though made at and as of
each such time (and it is understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as
amended and supplemented to each such time);
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by a pricing supplement, an Excluded Supplement or by an
amendment or supplement providing solely for the inclusion of additional
financial information, or, unless the Agents shall otherwise specify, other
than by an amendment or supplement which relates exclusively to an offering
of Securities other than the Notes), (ii) there is filed with the
Commission any Report on Form 10-K, (iii) there is filed with the
Commission any document incorporated by reference into the Prospectus
(other than any proxy or information statement or Current Report on Form 8-
K), (iv) there is filed with the Commission any proxy or information
statement that pertains to matters other than, or in addition to, an
election of directors, the adoption of a benefit plan, the ratification of
the Company's auditors or other routine housekeeping matters, (v) there is
filed with the Commission any Current Report on Form 8-K containing
information that is reasonably deemed by the Company to be materially
adverse to the business affairs or prospects of the Company, or (vi) (if
required pursuant to the terms of a Terms Agreement) the Company sells
Notes to an Agent pursuant to a Terms Agreement, the Company shall furnish
or cause to be furnished to the Agents forthwith a certificate dated the
date of filing with the Commission of such supplement or document, the date
of effectiveness of such amendment, or the date of such sale, as the case
may be, in form satisfactory to the Agent to the effect that the statements
contained in the certificate of the Company referred to in Section 5(b)
hereof which was last furnished to the Agent are true and correct at the
time of such amendment, supplement, filing or sale, as the case may be, as
though made at and as of such time (except that such statements shall be
deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in said
Section 5(b), modified as necessary to relate to the Registration Statement
and the Prospectus as amended and supplemented to the time of delivery of
such certificate. In the case of certificates to be furnished pursuant to
(iii), (iv) or (v) above, the Company may request that the Agents waive the
requirement for the certificates, which request shall not be unreasonably
refused;
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by a pricing supplement, an Excluded Supplement or by an
amendment or supplement providing solely for the inclusion of additional
financial information, or, unless the Agents shall otherwise specify, other
than by an amendment or supplement which relates exclusively to an offering
of Securities other than the Notes), (ii) there is filed with the
Commission any Report on Form 10-K, (iii) there is filed with the
Commission any document incorporated by reference into the Prospectus
(other than any proxy or information statement or Current Report on Form 8-
K or a Quarterly Report on Form 10-Q), (iv) there is filed with the
Commission any proxy or information statement that pertains to matters
other than, or in addition to, an election of directors, the adoption of a
benefit plan, the ratification of the Company's auditors or other routine
housekeeping matters, (v) there is filed with the
11
Commission any Current Report on Form 8-K containing information that is
reasonably deemed by the Company to be materially adverse to the business
affairs or prospects of the Company, (vi) (if required pursuant to the
terms of a Terms Agreement) the Company sells Notes to an Agent pursuant to
a Terms Agreement, the Company shall furnish or cause to be furnished
forthwith to the Agents and to counsel to the Agents the written opinions
of the General Counsel of the Company and special counsel to the Company or
other counsel satisfactory to the Agent dated the date of filing with the
Commission of such supplement or document, the date of effectiveness of
such amendment, or the date of such sale, as the case may be, in form and
substance satisfactory to the Agents, of the same tenor as the opinions
referred to in Section 5(a)(1)(B) and 5(a)(3) hereof, but modified, as
necessary, to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such opinions, or (vi)
in lieu of any such opinion required under Subsection (7)(c)(v) above,
counsel last furnishing such opinion to the Agents shall furnish the Agents
with a letter to the effect that the Agents may rely on such last opinion
to the same extent as though it was dated the date of such letter
authorizing reliance (except that statements in such last opinion shall be
deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such letter authorizing
reliance). In the case of opinions to be furnished pursuant to (iii), (iv)
or (v) above, the Company may request that Agents waive the requirement for
the opinions, which request shall not be unreasonably refused; and
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
to include additional financial information with respect to the Company,
(ii) the Company files with the Commission any Report on Form 10-K, (iii)
the Company files with the Commission any document incorporated by
reference to the Prospectus which contains additional financial information
(other than any Current Report on Form 8-K), (iv) the Company files with
the Commission any Current Report on Form 8-K (containing additional
information) which contains information that is reasonably deemed to be
materially adverse to the business affairs or prospects of the Company, or
(v) (if required pursuant to the terms of a Terms Agreement) the Company
sells Notes to an Agent pursuant to a Terms Agreement, the Company shall
cause KPMG Peat Marwick LLP or its successors forthwith to furnish the
Agents a letter, dated the date of filing with the Commission of such
amendment, supplement or document, the date of effectiveness of such
amendment, or the date of such sale, as the case may be, in form
satisfactory to the Agents, of the same tenor as the portions of the letter
delivered pursuant to Section 5(c) but modified to relate to the
Registration Statement and Prospectus, as amended and supplemented to the
date of such letter, and as may be necessary to reflect changes in the
financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration
Statement or the Prospectus is amended or supplemented solely to include
the financial information as of and for an interim period, KPMG Peat
Marwick LLP or its successors may limit the scope of such letter to the
unaudited financial statements included in such amendment or supplement
unless any other information included therein of an accounting, financial
or statistical nature is of such a nature that, in the reasonable judgment
of the Agents, such letter should cover such other information, and
provided, further, that the delivery of such letter by KPMG Peat Marwick
LLP (or its successors) shall be conditioned upon the receipt by KPMG Peat
Marwick LLP (or its successors) of: (i) an opinion of counsel for the
Agents, in form and substance reasonably satisfactory to KPMG Peat Marwick
LLP (or such successor) addressing whether the Agents can avail themselves
of the due diligence defense under the 1933 Act; or (ii) a representation
letter from the Agents addressed to KPMG Peat Marwick LLP in the form set
forth as Exhibit C hereto. In the case of letters to be furnished pursuant
to (iii) or (iv) above, the Company may request that the Agents waive the
requirement for the letters, which request shall not be unreasonably
refused.
Section 8. Payment of Expenses. The Company agrees to pay all expenses
incident to the performance of its obligations under this Agreement,
including:
(a) the preparation and filing of the Registration Statement and all
amendments thereto and the Prospectus and any amendments or supplements
thereto;
(b) the preparation, filing and reproduction of this Agreement;
12
(c) the preparation, printing, issuance and delivery of the Notes,
including any fees and expenses relating to the use of book-entry notes
(excluding any fees payable by an Agent solely as member of The Depository
Trust Company);
(d) the fees and disbursements of the Company's accountants and counsel,
of the Trustee and its counsel, and of any Calculation Agent or Exchange
Rate Agent;
(e) the reasonable fees and disbursements of counsel to the Agents
incurred from time to time in connection with the transactions contemplated
hereby;
(f) the qualification of the Notes under state securities laws in
accordance with the provisions of Section 4(e) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation of any Blue Sky
Survey and any Legal Investment Survey;
(g) the printing and delivery to the Agents in quantities as hereinabove
stated of copies of the Registration Statement and any amendments thereto,
and of the Prospectus and any amendment or supplements thereto, and the
delivery by the Agents of the Prospectus and any amendments or supplements
thereto in connection with solicitations or confirmations of sales of the
Notes;
(h) the preparation, printing, reproducing and delivery to the Agents of
copies of the Indenture and all supplements and amendments thereto;
(i) any fees charged by rating agencies for the rating of the Notes;
(j) the fees and expenses incurred in connection with the listing of the
Notes on any securities exchange;
(k) the fees and expenses, if any, incurred with respect to any filing
with the National Association of Securities Dealers, Inc.;
(l) any advertising and other out-of-pocket expenses of an Agent incurred
with the approval of the Company; and
(m) the fees and expenses of any Depository (as defined in the Indenture)
and any nominees thereof in connection with Notes.
Section 9. Indemnification. The Company agrees to indemnify and hold harmless
each Agent, and each person, if any, who controls each Agent within the
meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act,
from and against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation), as incurred, arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or
based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, except
insofar as such losses, claims, damages, liabilities or expenses arise out of
or are based upon any such untrue statement or omission or allegation thereof
based upon information furnished in writing to the Company by such Agent
expressly for use, therein; provided, however, the Company shall not indemnify
such Agent or any person who controls such Agent from any such losses, claims,
damages or liabilities alleged by any person who purchased Notes from such
Agent if the untrue statement, omission or allegation thereof upon which such
losses, claims, damages or liabilities are based was made in: (i) any
preliminary prospectus or Prospectus, if a copy of the Prospectus, or the
Prospectus as then amended or supplemented (if the Company shall have
furnished any amendments or supplements thereto), as the case may be, was not
sent or given by or on behalf of such Agent to such person at or prior to the
written confirmation of the sale of the Notes to such person, and if the
Prospectus, or the Prospectus as so amended or supplemented, as the case may
be, corrected the untrue statement or omission giving rise to such loss,
claim, damage or liability; (ii) any Prospectus used by such Agent (or any
broker or dealer appointed or engaged by such Agent) or any person who
controls such Agent, after such time as the Company advised such
13
Agent that the filing of a post-effective amendment or supplement thereto was
required, except the Prospectus as so amended or supplemented; or (iii) any
Prospectus used by such Agent (or any broker or dealer appointed or engaged by
such Agent) or any person who controls such Agent, after the termination of
the offering of the Notes. This indemnity will be in addition to any liability
which the Company may otherwise have.
If any action or proceeding (including any governmental investigation) shall
be brought or asserted against an Agent or any person controlling an Agent in
respect of which indemnity may be sought from the Company, such Agent or such
controlling person shall promptly notify the Company in writing, and the
Company shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Agent's party to such action or proceeding and
the payment of all expenses. Any omission so to notify the Company shall not,
however, relieve the Company from any liability which it may have to any
indemnified party otherwise than under this Section 9. Such Agent or any such
controlling person shall have the right to employ separate counsel in any such
action or proceeding and to participate in the defense thereof, but the fees
and expenses of such separate counsel shall be such Agent's expense or the
expense of such controlling person unless (a) the Company has agreed to pay
such fees and expenses, (b) the Company shall have failed to assume the
defense of such action or proceeding and employ counsel reasonably
satisfactory to the Agents in any such action or proceeding within a
reasonable time after notice of the commencement of such action or proceeding
or (c) the named parties to any such action or proceeding (including any
impleaded parties) include an Agent or any such controlling person and the
Company, and such Agent or such controlling person shall have been advised by
such counsel that there may be a conflict of interest between such Agent or
such controlling person and the Company in the conduct of the defense of such
action (in which case, if such Agent or such controlling person notifies the
Company in writing that it elects to employ separate counsel at the expense of
the Company, the Company shall not have the right to assume the defense of
such action or proceeding on such Agent's behalf or on behalf of such
controlling person, it being understood, however, that the Company shall not,
in connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings arising out of the
same general allegations or circumstances, be liable for the reasonable fees
and expenses of more than one separate firm of attorneys (unless the members
of such firm are not admitted to practice in a jurisdiction where an action is
pending, in which case the Company shall pay the reasonable fees and expenses
of one additional firm of attorneys to act as local counsel in such
jurisdiction, provided the services of such counsel are substantially limited
to that of appearing as attorneys of record) at any time for all indemnified
parties, which firm shall be designated in writing by such Agent). The Company
shall not be liable for any settlement of any such action or proceeding
effected without its written consent, but if settled with its written consent,
or if there be a final judgment for the plaintiff in any such action or
proceeding, the Company agrees to indemnify and hold harmless the Agent and
any such controlling person from and against any loss or liability by reason
of such settlement or judgment.
Each Agent agrees to indemnify and hold harmless the Company, its directors
and each of its officers, and each person, if any, who controls the Company
within the meaning of either Section 15 of the 1933 Act or Section 20 of the
1934 Act, to the same extent as the foregoing indemnity from the Company to
the Agents, but only with respect to information furnished in writing by such
Agent expressly for use in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any amendment or supplement thereto, or
any preliminary prospectus. In case any action or proceeding shall be brought
against the Company or its directors or officers or any such controlling
person, in respect of which indemnity may be sought against an Agent, such
Agent shall have the rights and duties given to the Company, and the Company
or its directors or officers or such controlling person shall have the rights
and duties given to the Agents, by the preceding paragraph.
Section 10. Contribution. If the indemnification provided for in Section 9 is
unavailable to an indemnified party under the first or third paragraph thereof
in respect of any losses, claims, damages or liabilities referred to therein
(other than by reason of such indemnified party's failure to comply with the
first sentence or the last sentence of the second paragraph of Section 9),
then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of
14
such losses, claims, damages or liabilities, as incurred (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and by each Agent on the other hand from the offering
of the Notes to which such loss, claim, damage or liability (or action in
respect thereof) relates, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of each Agent on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and by each Agent on the other in connection with the offering of the
Notes shall be deemed to be such that each Agent shall be responsible for the
aggregate losses, claims, damages and liabilities represented by the
percentage that the total underwriting discounts and agency commissions
received by such Agent with respect to the Notes giving rise to such losses,
claims, damages or liabilities bears to the total net proceeds for the sale of
such Notes, and the Company shall be responsible for the balance. The relative
fault of the Company on the one hand and of each Agent on the other 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 or by
each Agent and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, claims, damages and
liabilities referred to above shall be deemed to include, subject to the
limitations set forth in the second paragraph of Section 9, any legal or other
fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim.
The Company and each Agent agree that it would not be just and equitable if
contribution pursuant to this Section 10 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 10, each Agent shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Notes were offered to the public exceeds the amount
of any damages which such Agent has otherwise been required to pay by reason
of such untrue statement or omission or alleged untrue statement or omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
Section 11. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement by the Company and the Agents, or contained in certificates of
executive officers of the Company submitted pursuant hereto, shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of any Agent or controlling person, or by or on behalf of the
Company, and shall survive each delivery of and payment for any Notes.
Section 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any Terms
Agreement) may be terminated for any reason, at any time by the Company with
respect to any of the Agents, and any Agent may resign as Agent hereunder,
upon the giving of 1 day written notice of such termination to the other
parties hereto; provided, however, that in the event this Agreement is
terminated with respect to only one of the Agents, this Agreement shall remain
in full force and effect between the Company and other Agents.
(b) Termination of a Terms Agreement. An Agent may terminate any Terms
Agreement between such Agent and the Company, immediately upon notice to the
Company, at any time at or prior to the Settlement Time relating thereto (i)
if there has been since the date of the Terms Agreement or since the
respective dates as of which information is given in the Prospectus (as
amended or supplemented to the date of the Terms Agreement), any material
adverse change in the condition, financial or otherwise, of the Company and
its consolidated subsidiaries considered as one enterprise, or in the
earnings, business affairs or business prospects of the Company and its
consolidated subsidiaries considered as one enterprise, whether not arising in
the ordinary
15
course of business, (ii) if there shall have occurred any material adverse
change in the financial markets in the United States or any outbreak or
escalation of hostilities or other national or international calamity or
crisis the effect of which on the financial markets of the United States is
such as to make it, in the judgment of such Agent, impracticable to market the
Notes or enforce contracts for the sale of the Notes, (iii) if the rating
assigned by any nationally recognized securities rating organization in the
United States to any debt securities of the Company as of the date of the
Terms Agreement or if any such rating organization shall have publicly
announced that it has placed any debt securities of the Company on what is
commonly termed a "watch list" for possible downgrading, or (iv) if there
shall have come to such Agent's attention any facts that would cause such
Agent reasonably to believe that the Prospectus contains an untrue statement
of a material fact or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances then existing,
not misleading.
(c) General. In the event of any such termination pursuant to subsection (a)
or (b) above or Section 5 hereof, the resigning or terminating party will have
no liability to the other parties hereto and no other remaining party hereto
will have any liability to the resigning or terminating party, except that (i)
each Agent shall be entitled to any commission earned in accordance with the
third paragraph of Section 3(a) hereof, (ii) if at the time of termination by
the Company (a) an Agent shall own any Notes purchased pursuant to a Terms
Agreement with the intention of reselling them or (b) an offer to purchase any
of the Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto has not occurred,
the covenants set forth in Sections 4 and 7 hereof shall remain in effect
until (A) the earlier of the date such Notes are so resold or at the 90th day
following the related Settlement Time or (B) such Notes are delivered, as the
case may be, and (iii) the last sentence of Section 3(b), the covenant
regarding provision of an earnings statement set forth in Section 4(f) hereof,
the provisions concerning payment of expenses set forth in Section 4(e) and
Section 8 hereof, the indemnity and contribution agreements set forth in
Section 9 and 10 hereof and the provisions of Section 11 (but only as such
Sections relates to representations and warranties) and Section 14 hereof
shall remain effect.
Section 13. Notices. Unless otherwise provided herein, all notices required
under the terms and provisions hereof shall be in writing, either delivered by
hand, by mail or by telex, facsimile transmission, receipt acknowledged, or
telegram, and any such notice shall be effective when received at the address
specified below.
If to the Company:
TCI Communications, Inc.
Terrace Tower II
0000 XXX Xxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention:Xxxxxxx X. Xxxxxxxxx
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
with a copy (similarly addressed) to the attention of the General Counsel.
If to the Agents:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx, 00xx Xxxxx
World Financial Center
New York, New York 10281-1310
Attention:MTN Product Management
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
16
or, as the case may be,
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:Medium Term Finance
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
or, as the case may be,
Xxxxxx Brothers Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:Medium-Term Note Department
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
or, as the case may be,
Salomon Brothers Inc
Seven Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:Medium-Term Note Department
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
or at such other address as such party may designate from time to time by
notice duly given in accordance with the terms of this Section 13.
Section 14. Parties. This Agreement shall inure to the benefit of and be
binding upon the Agents and the Company, and their respective successors.
Nothing expressed or mentioned in any Terms Agreement or this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the parties hereto or thereto and their respective successors and the
controlling persons and officers and directors referred to in Sections 9 and
10 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under, or in respect of, this Agreement or any provision
herein contained. This Agreement and all conditions and provisions thereof and
hereof are intended to be for the sole and exclusive benefit of the parties
and their respective successors and said controlling persons and officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Notes from any Agent shall
be deemed to be a successor by reason merely of such purchase.
Section 15. Governing Law. This Agreement shall be governed by the laws of the
State of New York applicable to agreements made and performed in such State.
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement among the Agents and the Company in accordance with its terms.
Very truly yours,
TCI Communications, Inc.
/s/ Xxxxxxx X. Xxxxxxxxx
By: _________________________________
Name: Xxxxxxx X. Xxxxxxxxx
Title: Executive Vice President
and Treasurer
17
Accepted:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
/s/ Xxxxx Xxxxxxxx
By: ___________________________
Authorized Signatory
Credit Suisse First Boston Corporation
/s/ Xxxxxx Xxxxxxx
By: ___________________________
Authorized Signatory
Salomon Brothers Inc
/s/ Xxxxxxxx Xxxxxx
By: ___________________________
Authorized Signatory
Xxxxxx Brothers Inc.
/s/ Xxxx XxXxxx
By: ___________________________
Authorized Signatory
18
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company shall
pay, on a discount basis, at the Settlement Time to each Agent a commission in
connection with each original issuance of Notes by the Company for the sale of
each Note resulting from a placement made by such Agent equal to the principal
amount of such Note (or, if such Note is an Original Issue Discount Note, the
Issue Price of such Note) multiplied by the appropriate percentage set forth
below:
PERCENT OF PRINCIPAL AMOUNT
----------------------------
MATURITY RANGES SPLIT RATED INVESTMENT GRADE
--------------- ----------- ----------------
From 9 months to less than 1 year.................. .150% .125%
From 1 year to less than 18 months................. .200 .150
From 18 months to less than 2 years................ .250 .200
From 2 years to less than 3 years.................. .350 .250
From 3 years to less than 4 years.................. .450 .350
From 4 years to less than 5 years.................. .550 .450
From 5 years to less than 6 years.................. .600 .500
From 6 years to less than 7 years.................. .600 .550
From 7 years to less than 8 years.................. .700 .600
From 8 years to less than 9 years.................. .700 .600
From 9 years to less than 10 years................. .700 .600
From 10 years to less than 12 years................ .800 .625
From 12 years to less than 15 years................ .800 .625
From 15 years to less than 20 years................ .875 .700
From 20 years to 30 years.......................... .925 .750
19
EXHIBIT A
TO
DISTRIBUTION
AGREEMENT
TERMS AGREEMENT PROVISIONS
The following terms, if applicable, shall be agreed to by the applicable
Agent and the Company pursuant to each Terms Agreement:
Principal Amount: $
(or principal amount of foreign currency)
Interest Rate:
If Fixed Rate Note, Interest Rate:
Interest Payment Dates (if other than February 15 and August 15):
If Floating Rate Note:
Interest Rate Basis or Bases:
Initial Interest Rate:
Initial Interest Reset Date:
Spread or Spread Multiplier, if any:
Interest Reset Dates:
Interest Reset Period:
Interest Payment Dates:
Interest Payment Period:
Index Maturity:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Determination Dates:
Calculation Agent:
Calculation Date:
If Redeemable by the Company:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
If Repayable at option of the holder thereof:
Optional Repayment Date(s):
Stated Maturity:
Purchase Price: %
Settlement Time:
Currency of Denomination:
Denominations (if currency is other than solely United States dollars):
Currency Payment:
Additional Terms:
Also, agreement as to whether the following will be required:
Officer's Certificates pursuant to Section 7(b) of the Distribution
Agreement.
Accountant's Comfort Letters pursuant to Section 7(d) of the
Distribution Agreement.
Legal Opinions pursuant to Section 7(c) of the Distribution Agreement.
Stand-Off Agreement pursuant to Section 4(g) of the Distribution
Agreement.
20
EXHIBIT B
TO
DISTRIBUTION
AGREEMENT
(Date)
KPMG Peat Marwick LLP
000 00xx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Dear KPMG Peat Marwick LLP:
(Name of financial intermediary), as Agents, in the placement of (identify
securities) to be issued by TCI Communications, Inc., will be reviewing
certain information relating to TCI Communications, Inc. that will be included
(incorporated by reference) in the (identify document), which may be delivered
to investors and utilized by them as a basis for their investment decision.
This review process, applied to the information relating to the issuer, is
substantially consistent with the due diligence review process that an
underwriter would perform in connection with this placement of securities. We
are knowledgeable with respect to the due diligence review process that an
underwriter would perform in connection with a placement of securities
registered pursuant to the Securities Act of 1933. We hereby request that you
deliver to us a "comfort" letter concerning the financial statements of the
issuer and certain statistical and other data included in the offering
document. We will contact you to identify the procedures we wish you to follow
and the form we wish the comfort letter to take.
Very truly yours,
(Name of Financial Intermediary)
EXHIBIT C
TO
DISTRIBUTION
AGREEMENT
(Date)
KPMG Peat Marwick LLP
000 00xx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Dear KPMG Peat Marwick LLP:
(Name of financial intermediary), as Agents, in the placement of (identify
securities) to be issued by TCI Communications, Inc., will be reviewing
certain information relating to TCI Communications, Inc. that will be included
(incorporated by reference) in the (identify document), which may be delivered
to investors and utilized by them as a basis for their investment decision.
This review process, applied to the information relating to the issuer, is
substantially consistent with the due diligence review process that an
underwriter would perform in connection with this placement of securities. We
are knowledgeable with respect to the due diligence review process that an
underwriter would perform in connection with a placement of securities
registered pursuant to the Securities Act of 1933. We hereby request that you
deliver to us a "comfort" letter concerning the financial statements of the
issuer and certain statistical and other data included in the offering
document. We will contact you to identify the procedures we wish you to follow
and the form we wish the comfort letter to take.
Very truly yours,
(Name of Financial Intermediary)
