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CONTINGENT VALUE RIGHT AGREEMENT
Dated as of
September 18, 2000
between
PRIMACOM AG
and
CHASE SECURITIES INC.
as the CVR Agent
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EXHIBIT A - Form of CVR Certificate
EXHIBIT B - Form of Election to Purchase CVR Certificates
EXHIBIT C - Certificate to be Delivered upon Exchange or Registration of
Transfer of CVRs
EXHIBIT D - Registration Rights
ANNEX A - Release Certificate (Sale)
ANNEX B - Release Certificate (Earn-In)
ANNEX C - Retirement Certificate
ANNEX D - Earn-In Progression
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CONTINGENT VALUE RIGHT AGREEMENT, dated as of September 18, 2000 (this
"Agreement"), between PRIMACOM AG, a company organized under the laws of Germany
(the "Company"), and CHASE SECURITIES INC., as CVR Agent (in such capacity, the
"CVR Agent").
W I T N E S S E T H :
WHEREAS, it is a condition to the obligations of the Lenders under the
Senior Working Capital Agreement, dated as of September 18, 2000 (the "Credit
Agreement"), among the Company, the Lenders from time to time parties thereto
and Chase Manhattan International Limited, as Administrative Agent thereunder
(in such capacity, the "Credit Agreement Agent"), that the Company execute and
deliver this Contingent Value Right Agreement and the Contingent Value Right
Escrow Agreement, dated the date hereof (the "Contingent Value Right Escrow
Agreement"), between the Company and Chase Manhattan International Limited, as
CVR Escrow Agent (in such capacity, the "CVR Escrow Agent"), granting contingent
value rights ("CVRs") and to deposit with the CVR Escrow Agent thereunder
certificates evidencing the CVRs (the "CVR Certificates") to require the Company
until the Expiration Date to make a cash payment to the holder of each CVR equal
to the difference between the market price of a share of Common Stock of the
Company on the date of exercise of such CVR and 110% of the market price of a
share of such Common Stock on the Release Date, as more fully described below;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto hereby agree as follows:
SECTION 1. Defined Terms
1.1 Definitions.
All terms defined in the Credit Agreement shall have such defined
meanings when used herein or in any Exhibit unless otherwise defined herein or
therein. As used in this Agreement, the following terms shall have the following
meanings:
"Affiliate" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person means
the power, directly or indirectly, either to (a) vote 20% or more of the
securities having ordinary voting power for the election of directors of such
Person or (b) direct or cause the direction of the management and policies of
such Person, whether by contract or otherwise.
"Board" means the Supervisory Board of the Company (Aufsichtsrat).
"Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banks in New York City or London are authorized or required
by law to close.
"Combination" means an event in which the Company consolidates with,
merges with or into, or sells all or substantially all its property and assets
to another Person.
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"Common Stock" means the common stock, no par value, of the Company
together with any other equity securities that may be issued by the Company in
substitution therefor.
"Contingent Value Payment" has the meaning ascribed thereto in Section
3.1.
"Current Market Price" means, on any date, the greater of (1) the
average of the most recently reported per share sale price of the Company's
shares traded on the Nasdaq National Market for each Business Day during the
period commencing 20 Business Days before such date and ending on the date one
day prior to such date; and (2) the market price called for under a calculation
under Rule 144A(d)(3)(i) of the Securities Act such that the exercise price (as
referred to in Section 3.1) is an effective conversion premium equal to or
greater than 10%.
"CVR Certificates" means the certificates evidencing the CVRs to be
delivered pursuant to this Agreement, substantially in the form of Exhibit A
hereto.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means any Exchange Notes issued pursuant to the Credit
Agreement and the Indenture.
"Exercise Date Market Price" means, on any date, the most recently
reported sale price of the Company's shares traded on the Nasdaq National Market
on the date one day prior to such date.
"Expiration Date" means the tenth anniversary of the Closing Date.
"Holder" means the duly registered holder of a CVR under the terms of
this Contingent Value Right Agreement and the Contingent Value Right Escrow
Agreement.
"Initial Maturity Date" means the date which is one year after the
Closing Date.
"Initial Lenders" means the Lenders parties to the Credit Agreement on
the Closing Date.
"Initial Loans" means the Initial Loans made pursuant to the Credit
Agreement.
"Loans" means the Initial Loans and the Term Loans.
"Noteholders" means the Initial Lenders.
"Note Purchaser" means any Person who has agreed to purchase Loans or
Exchange Notes from a Noteholder.
"Officer" means any two members of the executive committee of the
Company (Vorstand).
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"Person" means any individual, corporation, partnership, joint venture,
limited liability company, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Release Certificate" means a certificate, substantially in the form
attached hereto as Annex A or B, presented by a Noteholder to the CVR Agent in
order to obtain release from escrow of some or all of the CVRs under the
procedure described herein in Section 4.2 or 4.3.
"Release Dates" means each date which is three months, six months, nine
months and twelve months after June 30, 2001.
"Release Ratio" means, for the purposes of any determination thereof on
any date, the ratio of (i) the Commitment by an Initial Lender on the Closing
Date to (ii) the aggregate of all Commitments on the Closing Date.
"Replacement Warrants": shall have the meaning ascribed to such term in
Section 2.9.
"Retirement Certificate" means a certificate substantially in the form
attached hereto as Annex C, presented by the Company to the CVR Agent in order
to obtain release of the CVRs from escrow under the procedure described herein
in Section 4.5.
"Rule 144" means Rule 144 promulgated under the Securities Act, as such
Rule may be amended from time to time, or any successor rule or regulation
hereinafter adopted by the SEC.
"SEC" means the Securities and Exchange Commission (or any successor
thereto).
"Securities Act" means the Securities Act of 1933, as amended.
"Strike Price" means, of any CVR, 110% of the Current Market Price of
one share of common stock as of the date on which such CVR is released from
escrow (as adjusted pursuant to Article 5 of this Agreement).
"Term Loans" means any Term Loans made pursuant to the Credit
Agreement.
"Transfer Restricted Securities" means the CVRs which may be issued to
Holders upon exercise of the CVRs whether or not such exercise has been
effected. Each such security shall cease to be a Transfer Restricted Security
when the legend set forth in Section 2.5 is, or may be, removed pursuant to
Section 2.4(b)(v).
"Voting Stock" of a corporation means all classes of capital stock of
such corporation then outstanding and normally entitled to vote in the election
of the Board.
1.2 Other Definitions.
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Defined in
Term Section
----- -----------
"Agreement"................................................. Preamble
"Certificate Register"...................................... 2.3
"Company"................................................... Preamble
"Contingent Value Right Escrow Agreement"................... Recitals
"Credit Agreement".......................................... Preamble
"CSI"....................................................... 4.4
"Current Market Value"...................................... 5.8
"CVRs"...................................................... Recitals
"CVR Agent"................................................. Preamble
"CVR Escrow Agent".......................................... Recitals
"Earn-In Release"........................................... 4.3
"Fair Value"................................................ 5.2
"Release on Sale"........................................... 4.2
"Retirement Release"....................................... 4.5
"Share Settlement Exercise"................................. 3.4
"Successor Company"......................................... 5.5(a)
"Time of Determination"..................................... 5.8
1.3 Rules of Construction.
Unless the text otherwise required.
(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 generally accepted accounting principles as in effect
from time to time;
(c) "or" is not exclusive;
(d) "including" means including, without limitation; and
(e) words in the singular include the plural and words in the plural
include the singular.
SECTION 2. CVR Certificates
2.1 Issuance and Dating.
The CVRs shall be initially granted conditionally on the Closing Date
and the relevant CVR Certificates shall be deposited with the CVR Escrow Agent
pursuant to the terms of the Contingent Value Right Escrow Agreement. The CVR
Certificates will be
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issued in registered form as definitive CVR Certificates, substantially
in the form of Exhibit A, which is hereby incorporated in and expressly
made a part of this Agreement. The CVR Certificates may have notations,
legends or endorsements required by law, stock exchange rules,
agreements to which the Company is subject, if any, or usage (provided
that any such notation, legend or endorsement is in a form acceptable
to the Company) and shall bear the legend required by Section 2.5. Each
CVR shall be dated the date of its countersignature.
2.2 Execution and Countersignature.
(a) With respect to the CVRs to be granted on the Closing Date, one or
more CVR Certificates as specified by the Administrative Agent representing the
CVRs shall be executed in blank on behalf of the Company by manual or facsimile
signature by one Officer. The CVR Agent shall countersign such CVR
Certificate(s) by manual or facsimile signature, and such CVR Certificate(s)
shall be delivered in accordance with Section 2.1 hereof.
(b) With respect to all other CVRs, the CVR Certificates therefor shall
be executed on behalf of the Company by one Officer. Such signature may be
manual or facsimile signature. If an Officer whose signature is on a CVR
Certificate no longer holds that office at the time the CVR Agent countersigns
the CVR Certificate, the CVR Certificate shall be valid nevertheless. A CVR
Certificate shall not be valid until an authorized signatory of the CVR Agent
manually countersigns the CVR Certificate. The signature shall be conclusive
evidence that the CVR Certificate has been countersigned under this Agreement.
(c) Upon written order from the CVR Agent, the Company shall execute
and deliver to the CVR Agent, and the CVR Agent shall countersign and deliver to
the CVR Escrow Agent, CVR Certificates registered in the name or names and for
such number of CVRs as shall be specified by the CVR Agent in such order in
exchange for CVR Certificate(s) then held by the CVR Escrow Agent for a like
number of CVRs. To the extent the CVR Certificate(s) delivered by the CVR Escrow
Agent to the CVR Agent represent a greater number of CVRs than specified in the
order from the CVR Agent, the Company shall execute and deliver to the CVR
Agent, and the CVR Agent shall countersign and deliver to the CVR Escrow Agent,
CVR Certificates in blank for such excess number of CVRs to be held in escrow by
the CVR Escrow Agent pursuant to the CVR Escrow Agreement.
(d) The CVR Agent may appoint an agent reasonably acceptable to the
Company to countersign the CVR Certificate on behalf of the CVR Agent. Unless
limited by the terms of such appointment, such agent may countersign the CVR
Certificate whenever the CVR Agent may do so. Each reference in this Agreement
to countersignature by the CVR Agent includes by such agent.
2.3 Certificate Register.
The CVR Agent shall keep a register ("Certificate Register") of the CVR
Certificates and of their transfer and exchange. The Certificate Register shall
show the names and addresses of the respective Holders and the date and number
of CVRs evidenced on the face of each of the CVR Certificates. The Company and
the CVR Agent may deem and treat the Person in whose name a CVR Certificate is
registered as the absolute owner of such CVR Certificate for all purposes
whatsoever and neither the Company nor the CVR Agent shall be affected by notice
to the contrary.
2.4 Transfer and Exchange.
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(a) When CVRs are presented to the CVR Agent with a request to register
the transfer of such CVRs or to exchange such CVRs for an equal number of CVRs
of other authorized denominations, the CVR Agent shall register the transfer or
make the exchange as requested if its reasonable requirements for such
transaction are met; provided, however, that the CVR Certificates representing
such CVRs surrendered for transfer or exchange:
(i) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the CVR Agent, duly
executed by the Holder thereof or his attorney duly authorized in writing;
(ii) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the CVR Agent, duly
executed by the Holder thereof or his attorney duly authorized in writing; and
(iii) in the case of CVRs that are Transfer Restricted Securities,
shall be accompanied by the following additional information and documents:
(A) a certificate from such Holder in substantially the form of
Exhibit C hereto certifying that:
(1) such securities are being delivered for registration in the
name of such Holder without transfer;
(2) such securities are being transferred to the Company;
(3) such securities are being transferred pursuant to an
effective registration statement under the Securities Act;
or
(4) such securities are being transferred (w) to a "qualified
institutional buyer" ("QIB") as defined in Rule 144A under
the Securities Act pursuant to such Rule 144A, (x) in an
offshore transaction in accordance with Rule 904 under the
Securities Act, (y) in a transaction meeting the
requirements of Rule 144 under the Securities Act or (z)
pursuant to another available exemption from the
registration requirements of the Securities Act; and
(B) in the case of any transfer described under clause
(a)(iii)(A)(4)(x), (y) and (z) of this Section 2.4, evidence
reasonably satisfactory to the CVR Agent and the Company (which
may include an opinion of counsel) as to compliance with the
restrictions set forth in the legend in Section 2.5.
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(b) (i) To permit registrations of transfers and exchanges meeting the
requirements of clause (a) of this Section 2.4, the Company shall execute and
the CVR Agent shall countersign CVR Certificates as required pursuant to the
provisions of this Section 2.4.
(ii) All CVR Certificates issued upon any registration of transfer or
exchange of CVRs shall evidence the valid obligations of the Company, and
benefits conferred under this Agreement, as the CVR Certificates surrendered
upon such registration of transfer or exchange.
(iii) Prior to due presentment of any CVR Certificate for registration
of transfer of any CVR, the CVR Agent and the Company may deem and treat the
Person in whose name any CVR is registered as the absolute owner of such CVR and
neither the CVR Agent nor the Company shall be affected by notice to the
contrary.
(iv) No service charge shall be made to a Holder for any registration
of transfer or exchange upon surrender of any CVR Certificate at the office of
the CVR Agent maintained for that purpose. However, 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
CVR Certificates.
(v) Upon any sale or transfer of CVRs pursuant to an effective
registration statement under the Securities Act, pursuant to Rule 144(k) under
the Securities Act or pursuant to an opinion of counsel reasonably satisfactory
to the Company that no legend is required, the CVR Agent shall permit the Holder
thereof to exchange such CVRs for CVRs represented by CVR Certificates that do
not bear the legend set forth in Section 2.5 and rescind any restriction on the
transfer of such CVRs.
2.5 Legends.
Except for CVR Certificates delivered pursuant to Section 2.4(b)(v) of this
Agreement, each CVR Certificate evidencing the CVRs (and all CVR Certificates
issued in exchange therefor or substitution thereof) and each certificate
representing the CVR Shares (unless such CVR are not Transfer Restricted
Securities) shall bear a legend in substantially the following form (with any
appropriate modification for the CVR Shares):
"THE CVRs HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS CVR NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, REGISTRATION AND SUBJECT TO COMPLIANCE WITH OTHER APPLICABLE LAWS. THE
HOLDER HEREOF, BY ITS ACCEPTANCE
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HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH CVR, UNLESS
PREVIOUSLY REGISTERED UNDER THE SECURITIES ACT, ONLY (A) TO THE COMPANY;
(B) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE); (C) TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A; (D) PURSUANT TO AN
OFFSHORE TRANSACTION COMPLYING WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT; OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
2.6 Replacement Certificates.
If a mutilated CVR Certificate is surrendered to the CVR Agent or if the
Holder of a CVR Certificate claims that the CVR Certificate has been lost,
destroyed or wrongfully taken, the Company shall issue and the CVR Agent shall
countersign a replacement CVR Certificate if the reasonable requirements of the
CVR Agent and of Section 8-405 of the Uniform Commercial Code as in effect in
the State of New York are met. If required by the CVR Agent or the Company, such
Holder shall furnish an indemnity bond in favor of the Company and the CVR Agent
sufficient in the judgment of the Company and the CVR Agent to protect the
Company and the CVR Agent from any loss which either of them may suffer if a CVR
Certificate is replaced. The Company and the CVR Agent may charge the Holder for
their expenses in replacing a CVR Certificate. Every replacement CVR Certificate
is an additional obligation of the Company.
2.7 [INTENTIONALLY OMITTED].
2.8 Cancellation.
(a) In the event the Company shall purchase or otherwise acquire or
extinguish CVRs, the CVR Certificates in respect thereof shall thereupon be
delivered to the CVR Agent for cancellation.
(b) The CVR Agent and no one else shall cancel and destroy all CVR
Certificates surrendered for transfer, exchange, replacement, exercise or
cancellation and deliver a certificate of such destruction to the Company unless
the Company directs the CVR Agent to deliver canceled CVR Certificates to the
Company. The Company may not issue new CVR Certificates to replace CVR
Certificates to the extent they evidence CVRs which have been exercised or CVRs
which the Company has purchased or otherwise acquired.
2.9 Replacement of CVRs. The Company agrees that as promptly as practicable
after the date hereof, it will convene a shareholders meeting and a meeting of
the Board, in each case, to approve, and do all such other acts that may be
reasonably available to it to procure, the issue to the Holders of warrants (the
"Replacement Warrants") with a
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maturity date falling on the tenth anniversary of the Closing Date to purchase
up to an aggregate amount of 5% of the fully diluted Common Stock of the Company
on the Closing Date adjusted in accordance with Section 5 with terms and
conditions analogous in economic form to the terms and conditions hereof. Upon
the issuance of the Replacement Warrants, the Replacement Warrants shall be
substituted for and shall replace the CVRs then in issue at such time. Warrant
certificates representing the Replacement Warrants to the Holders of the CVRs
shall only be delivered against surrender of CVR Certificates.
SECTION 3. Exercise Terms
3.1 Exercise Price.
Each CVR shall initially entitle the Holder thereof, subject to adjustment
pursuant to the terms of this Agreement, to require the Company to pay to it an
amount equal to the difference between (a) the Exercise Date Market Price and
(b) the Strike Price with respect to one share of Common Stock (as the same may
be adjusted pursuant to Article 5) (such difference, the "Contingent Value
Payment").
3.2 Exercise Periods.
Subject to the terms and conditions set forth herein, each CVR shall
entitle the Holder thereof to require the Company to make the Contingent Value
Payment at any time or from time to time on or after the Closing Date and on or
prior to the Expiration Date; provided, however, that CVRs that are held in
escrow pursuant to the terms of the Contingent Value Right Escrow Agreement are
not eligible for exercise unless and until they are released from escrow
pursuant to the terms of the Contingent Value Right Agreement and this
Agreement.
3.3 Expiration.
A CVR shall terminate and become void as of the earlier of (a) the close of
business on the Expiration Date and (b) the time and date such CVR is exercised.
The Company shall give notice not less than 90, and not more than 120, days
prior to the Expiration Date to the Holders of all then outstanding CVRs to the
effect that the CVRs will terminate and become void as of the close of business
on the Expiration Date. The CVRs shall terminate and become void after the
Expiration Date, notwithstanding the Company's failure to give such notice.
3.4 Manner of Exercise.
CVRs may be exercised by surrender to the CVR Agent of CVR Certificates on
or before the Expiration Date. Immediately following such surrender, the CVR
Agent shall give notice (each, a "Close-out Notice") to the Company of the
surrender of such CVR Certificate. The Company shall either:
(a) within five days of the Close-out Notice, pay to the CVR Agent, for
immediate onward transmission to the relevant Holder, the Contingent Value
Payment, calculated by reference to, and due in respect of, the CVRs to
which the CVR Certificates surrendered relate; or
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(b) within fifteen days of the Close-out Notice, together with payment of such
Contingent Value Payment (but subject to the set-off provision below),
notify the CVR Agent that it wishes to effect settlement of the Contingent
Value Payment by way of the issue of Common Stock of the Company to the
relevant Holder, in which case, the Company shall procure the issue to such
Holder of such number of shares of Common Stock in the Company as have an
aggregate Exercise Date Market Price (determined as at the date of receipt
of the Close-out Notice) equal to the Contingent Value Payment with respect
to the number of shares underlying the CVRs being exercised within fifteen
Business Days of receipt of the Close-out Notice, in which case, the
relevant Holder shall (but subject to the set-off provision below) on the
last day of such period of fifteen Business Days, pay to the Company an
amount equivalent to the Contingent Value Payment made in respect of such
CVRs.
Whether the Company shall perform its obligations in the manner described in
paragraph (a) or paragraph (b) above shall be entirely at the option of the
Company.
In the event that the Company elects to fulfill its obligations in the manner
prescribed in paragraph (b) the Contingent Value Payment due from the Company to
the relevant Holder may, at the option of the Company but not the Holder, be
set-off against the payment due by the Holder against the issuance of Common
Stock of the Company to the Holder in accordance with paragraph (b) above.
An exercise of a CVR in accordance with these provisions is herein referred to
as a "Share Settlement Exercise". All provisions of this Agreement shall be
applicable with respect to an exercise of CVR Certificates pursuant to a Share
Settlement Exercise for less than the full number of CVRs represented thereby.
Subject to Section 3.2, the rights represented by the CVRs shall be exercisable
at the election of the Holders thereof either in full at any time or from time
to time in part and in the event that a CVR Certificate is surrendered for
exercise in respect of the Contingent Value Payment in respect of less than all
the shares of Common Stock represented by such CVR Certificate at any time prior
to the Expiration Date a new CVR Certificate in respect of the remaining shares
represented thereby will be issued. The CVR Agent shall countersign and deliver
the required new CVR Certificates, and the Company, at the CVR Agent's request,
shall supply the CVR Agent with CVR Certificates duly signed on behalf of the
Company for such purpose.
SECTION 4. Release of CVRs from Escrow
4.1 Terms of Release.
The CVRs created under the terms of this Agreement shall be released in
whole or in part by the Escrow Agent only through one of the procedures
described below in Section 4.2, 4.3, 4.4 or 4.5.
4.2 Release on Transfer of Loans or Exchange Notes (a "Release on Sale").
In the event that release of the CVRs from escrow becomes necessary to
effectuate the sale by a Noteholder to a Note Purchaser of Loans or Exchange
Notes at a price not greater than the principal amount thereof plus accrued and
unpaid interest thereon, such Noteholder, if it so elects, may, following
communication with the Company, obtain release of a portion of the CVRs in
escrow by presenting the CVR Agent with a Release Certificate, substantially in
the form attached hereto as Annex A. The number of CVRs to be released to
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any Noteholder shall not be greater than the product of (a) the total number of
CVRs initially issued under this Agreement (as reduced by CVRs released pursuant
to Section 4.4 hereof) and (b) the Release Ratio applicable to such Noteholder
and subtracting from such product of (a) and (b) the total number of CVRs
theretofore released to such Noteholder up to the time of such release pursuant
to Section 4.2 and 4.3.
4.3 Earn-In Release (an "Earn-In Release").
In accordance with the provisions of this Section 4.3, over time, the
Noteholders will become entitled to receive CVRs. The number of CVRs to which
each Noteholder continuing to hold Loans or Exchange Notes will be entitled to
receive under this Section 4.3 on each Release Date will be equal to a number
calculated by taking the product of (a) the product of (i) a percentage, with
credit for any portion of a period, initially 25% on the first Release Date,
increasing on each Release Date thereafter to the applicable percentage set
forth in Annex D hereto and (ii) the Release Ratio applicable to such Noteholder
and (b) the total number of CVRs initially issued under this Agreement (as
reduced by CVRs released pursuant to Section 4.4 hereof), and subtracting from
such product of (a) and (b) the total number of CVRs theretofore released to
that Noteholder up to the time of such Release Date pursuant to Section 4.2 and
4.3. In no event shall any Noteholder receive pursuant to Section 4.2 and this
Section 4.3 an amount of CVRs greater than a number equal to the product of (a)
the Release Ratio applicable to such Noteholder and (b) the total number of CVRs
initially issued under this Agreement reduced by CVRs released pursuant to
Section 4.4 hereof).
At the time when a Noteholder becomes entitled to CVRs under this Section
4.3, the Noteholder may obtain release of those CVRs from escrow by presenting
the CVR Agent with a Release Certificate, which shall be substantially in the
form attached hereto as Annex B, requesting the release of the proportionate
number of CVRs to the Noteholder. Such Release Certificates may be presented on
any date on or after each Release Date, so long as on such date the Noteholder
continued to hold Loans or Exchange Notes, and will entitle the Noteholder to
receive the number of CVRs accrued as of the date such Release Certificate is
presented to the CVR Agent. In the event that any Noteholder wishes to
automatically receive its accrued CVRs upon each Release Date, it may elect to
do so by checking the appropriate box on the first Release Certificate presented
to the CVR Agent.
4.4 Take-Out Release (a "Take-Out Release").
(a) In the event of a refinancing of the Loans and/or Exchange Notes with
the proceeds of the issuance of securities in a public or private offering in
which Chase Securities Inc. ("CSI") or any of its affiliates is lead
underwriter, initial purchaser or placement agent, if it shall be reasonably
determined by CSI based on then prevailing market conditions and following
communication with the Company that it is necessary and advisable to sell such
securities with an equity based return component in order for the Company to
sell such securities at par or otherwise permit the Company to receive net
proceeds from the sale of such securities in an amount sufficient to repay in
full all Initial Loans and Exchange Notes or to terminate the Commitments in
respect thereof, all or any portion of the CVRs then in escrow, subject to any
accrued rights of Noteholders pursuant to Section 4.3, may be released to CSI or
such affiliate for sale with such securities upon delivery to the CVR Agent of a
written certification by CSI or such affiliate stating that the Company and CSI
or such affiliate have entered into an underwriting agreement or purchase
agreement for the issuance of such securities with CVRs and setting forth the
number of CVRs to be released pursuant to
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this Section 4.4(a) and stating that the release of such CVRs is necessary to
sell such securities at par or to otherwise permit the Company to receive net
proceeds from the sale of such securities in an amount sufficient to repay in
full all Initial Loans and Exchange Notes or to terminate the Commitments in
respect thereof.
(b) Upon release of any CVRs pursuant to this Section 4.4, the rights of
the Noteholders and the Company under this Article 4 shall automatically
terminate.
4.5 Retirement Release (a "Retirement Release").
In the event that the Company retires or cancels all or any part of the
Loans and Exchange Notes, the Company may obtain the release of all or an
equivalent proportion of the CVRs then held in escrow (other than CVRs to which
Noteholders would then be entitled under Section 4.3) by presenting a Retirement
Certificate to the CVR Agent, substantially in the form affixed hereto as Annex
C, whereupon the rights of each Noteholder and CSI to obtain further release of
any CVRs pursuant to this Article 4 shall terminate proportionately.
4.6 Release Procedures.
Upon receipt by the CVR Agent of a Release Certificate or a certificate by
CSI or any of its affiliates pursuant to Section 4.4 or a Retirement Certificate
the CVR Agent will present such Certificate to the CVR Escrow Agent as
contemplated by Section 2 of the Contingent Value Right Escrow Agreement. In the
case of a Release Certificate, CVRs released from escrow will be registered in
the name requested by the Noteholder or, in the case of a release pursuant to
Section 4.2, the Note Purchaser providing such Certificate and in the case of a
certificate by CSI, in the name or names specified by CSI.
SECTION 5. Antidilution Provisions
5.1 Changes in Common Stock.
In the event that at any time or from time to time after the date hereof
the Company shall (a) pay a dividend or make a distribution on its Common Stock
in shares of its Common Stock or other shares of capital stock, (b) subdivide
its outstanding shares of Common Stock into a larger number of shares of Common
Stock, (c) combine its outstanding shares of Common Stock into a smaller number
of shares of Common Stock or (d) increase or decrease the number of shares of
Common Stock outstanding, in each case, by reclassification of its Common Stock,
then the Strike Price shall be adjusted so that, after giving affect to such
adjustment, the Holder (or potential Holder, in the case of CVRs still in
escrow) of each CVR shall be entitled to receive a Contingent Value Payment in
an amount equal to the Contingent Value Payment that such holder would have been
entitled to receive had such CVRs been exercised immediately prior to the
happening of the events described above (or, in the case of a dividend or
distribution of Common Stock, immediately prior to the record date therefor). An
adjustment made pursuant to this Section 5.1 shall become effective
15
immediately after the effective date, retroactive to the record date therefor in
the case of a dividend or distribution in shares of Common Stock, and shall
become effective immediately after the effective date in the case of a
subdivision, combination or reclassification.
5.2 Cash Dividends and Other Distributions.
In the event that at any time or from time to time after the date hereof
the Company shall distribute to holders of Common Stock (a) any dividend (other
than non-extraordinary dividends payable out of current earnings and profits) or
other distribution of cash, evidences of its indebtedness, shares of its capital
stock or any other properties or securities or (b) any options, warrants or
other rights to subscribe for or purchase any of the foregoing (other than, in
each case set forth in (a) and (b), (i) any such dividend or distribution
described in Section 5.1 or (ii) any rights, options, warrants or securities
described in Section 5.3) then the number of shares of Common Stock with respect
to which the Holder of a CVR shall be entitled to a Contingent Value Payment
shall be increased to a number determined by multiplying the number of shares of
Common Stock with respect to which a Contingent Value Payment would have been
payable upon the exercise of such CVR immediately prior to the record date for
any such dividend or distribution by a fraction, the numerator of which shall be
the Current Market Value per share of Common Stock on the record date for such
distribution, and the denominator of which shall be such Current Market Value
per share of Common Stock less the sum of (x) any cash distributed per share of
Common Stock and (y) the fair value (the "Fair Value") (as determined in good
faith by the Board, whose determination shall be evidenced by a board resolution
filed with the CVR Agent, a copy of which will be sent to Holders upon request)
of the portion, if any, of the distribution applicable to one share of Common
Stock consisting of evidences of indebtedness, shares of stock, securities,
other property, warrants, options or subscription of purchase rights
(notwithstanding the foregoing, if the Fair Value per share of Common Stock in
the above formula equals or exceeds the Current Market Value per share of Common
Stock in the above formula, then the Current Market Value per share of Common
Stock shall be equal to the Fair Value per share of the Common Stock on the
record date as determined in good faith by the Board and described in a Board
resolution filed with the CVR Agent). Such adjustments shall be made whenever
any distribution is made and shall become effective as of the date of
distribution, retroactive to the record date for any such distribution;
provided, however, that the Company is not required to make an adjustment
pursuant to this Section 5.2 if at the time of such distribution the Company
makes the same distribution to Holders of CVRs as it makes to holders of Common
Stock pro rata based on the number of shares of Common Stock for which such CVRs
are exercisable (whether or not currently exercisable).
5.3 Rights Issue.
In the event that at any time or from time to time after the date hereof
the Company shall issue, sell, distribute or otherwise grant any rights to
subscribe for or to purchase, or any options or warrants for the purchase of, or
any securities convertible or exchangeable into, Common Stock, entitling such
holders to subscribe for or purchase shares of Common Stock or stock or
securities convertible into Common Stock, whether or not immediately
exercisable, convertible or exchangeable, as the case may be, and the price per
share of Common Stock issuable upon exercise, conversion or exchange thereof is
lower at the record date for such issuance than the then Current Market Value
per share of Common Stock, then the number of shares of Common Stock thereafter
with respect to which the Holder of a CVR shall be entitled to a Contingent
Value Payment shall be increased to a number determined by multiplying the
number of shares of Common Stock with respect to
16
which a Contingent Value Payment would have been payable upon the exercise of
such CVR immediately prior to the date of issuance of such rights, options,
warrants or securities by a fraction, the numerator of which shall be the number
of shares of Common Stock outstanding on the date of issuance of such rights,
options, warrants or securities plus the number of additional shares of Common
Stock offered for subscription or purchase or into or for which such securities
are convertible or exchangeable, and the denominator of which shall be the
number of shares of Common Stock outstanding on the date of issuance of such
rights, options, warrants or securities plus the total number of shares of
Common Stock which could be purchased at the Current Market Value with the
aggregate consideration received through issuance of such rights, warrants,
options, or convertible securities. Such adjustment shall be made whenever such
rights, options or warrants are issued and shall become effective retroactively
immediately after the record date for the determination of stockholders entitled
to receive such rights, options, warrants or securities. Notwithstanding any
other provision of this Section 5.3, the number of shares of Common Stock with
respect to which the Holder of a CVR shall be entitled to a Contingent Value
Payment upon exercise of any CVR shall not be adjusted pursuant to this Section
5.3 in connection with the issuance or sale of rights, options, warrants or
convertible or exchangeable securities in connection with: (a) a firm committed
underwritten public offering of rights, or convertible or exchangeable
securities by the Company, (b) a private placement of rights or convertible or
exchangeable securities by the Company in which at least 50% of the securities
being issued are issued to Persons who are not Affiliates of the Company or any
holder of Common Stock or (c) the issuance or grant of rights or options after
the date hereof to the Company's or any of its Subsidiaries' employees,
officers, directors, consultants or advisors under bona fide benefit plans
adopted by the Board and approved by the holders of Common Stock when required
by law, if the number of shares of Common Stock underlying such rights and
options do not exceed 5% of the Common Stock outstanding on the date of this
Agreement.
If the Company at any time shall issue two or more securities as a unit and
one or more of such securities shall be rights, options or warrants for or
securities convertible or exchangeable into, Common Stock subject to this
Section 5.3, the consideration allocated to each such security shall be
determined in good faith by the Board.
5.4 Issuance of Additional Shares of Common Stock.
In the event that at any time or from time to time after the date hereof
the Company shall issue or sell any additional shares of Common Stock for
consideration in an amount per additional share of Common Stock less than the
Current Market Value, then the number of shares of Common Stock thereafter with
respect to which the Holder of a CVR shall be entitled to a Contingent Value
Payment upon the exercise of each CVR shall be increased to a number determined
by multiplying the number of shares of Common Stock with respect to which the
Holder of a CVR shall be entitled to a Contingent Value Payment upon the
exercise of each CVR immediately prior to such issue or sale by a fraction the
numerator of which shall be the number of shares of Common Stock outstanding
immediately after such issue or sale, and the denominator of which shall be the
sum of (i) the number of shares of Common Stock outstanding immediately prior to
such issue or sale, and (ii) the number of shares of Common Stock which could be
purchased at the Current Market Value with the aggregate consideration received
from the issuance or sale of the additional shares of Common Stock. For the
purposes of this Section 5.4, the date as of which the Current Market Value per
share of Common Stock shall be computed shall be the earlier of (x) the date on
which the Company shall enter into a firm contract for the issuance of such
additional shares of Common Stock or (y) the date of actual issuance of such
additional shares of
17
Common Stock. Notwithstanding any other provision of this Section 5.4, the
number of shares of Common Stock with respect to which the Holder of a CVR shall
be entitled to a Contingent Value Payment upon exercise of any CVR shall not be
adjusted pursuant to this Section 5.4 as a result of the issuance or sale of
Common Stock in connection with: (a) a bona fide firm commited underwritten
public offering of Common Stock of the Company, (b) a private placement
transaction in which at least 50% of the shares of Common Stock being issued are
issued to Persons who are not Affiliates of the Company or any holder of Common
Stock, (c) a transaction to which Section 5.1, 5.2 or 5.3 is applicable, (d) the
exercise of the CVRs, (e) the exercise of rights or options issued to the
Company's or any of its Subsidiaries' employees, officers, directors,
consultants or advisors under bona fide benefit plans adopted by the Board and
approved by the holders of Common Stock when required by law, if such Common
Stock would otherwise be covered by this Section 5.4 (but only to the extent, in
the case of rights or options granted after the date hereof, that the aggregate
number of shares excluded hereby does not exceed 5% of the Common Stock
outstanding on the date of this Agreement) or (f) Common Stock issued to
stockholders of any Person that is not an Affiliate of the Company and that
merges with the Company in proportion to their stock holdings of such Person
immediately prior to such merger.
5.5 Combination; Liquidation.
(a) Except as provided in Section 5.5(b), in the event of any Combination,
the Holders shall have the right to receive upon exercise of the CVRs Contingent
Value Payments with respect to the number of shares of capital stock or other
securities or property which such Holder would have been entitled to receive
upon or as a result of such Combination had such CVR been exercised immediately
prior to such event. Unless paragraph (b) is applicable to a Combination, the
Company shall provide that the surviving or acquiring Person (the "Successor
Company") in such Combination will enter into an agreement with the CVR Agent
confirming the Holders' rights pursuant to this Section 5.5(a) and providing for
adjustments, which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article 5. The provisions of this Section
5.5(a) shall similarly apply to successive Combinations involving any Successor
Company.
(b) In the event of (i) a Combination where consideration to holders of
Common Stock in exchange for their shares is payable solely in cash, or (ii) the
dissolution, liquidation or winding-up of the Company, then the Holders of the
CVRs will be entitled to receive distributions on an equal basis with the
holders of Common Stock or other securities issuable upon exercise of the CVRs,
as if the CVRs had been exercised immediately prior to such event, less clause
(b) of the definition of Contingent Value Payment.
In case of any Combination described in this Section 5.5(b), the surviving
or acquiring Person and, in the event of any dissolution, liquidation or
winding-up of the Company, the Company, shall deposit promptly with the CVR
Agent the funds, if any, necessary to pay to the holders of the CVRs the amounts
to which they are entitled as described above. After such funds and the
surrendered CVR Certificates are received, the CVR Agent shall make payment to
the Holders by delivering a check in such amount as is appropriate (or, in the
case of consideration other than cash, such other consideration as is
appropriate) to such Person or Persons as it may be directed in writing by the
Holders surrendering such CVRs.
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5.6 Tender Offers: Exchange Offers.
In the event that the Company or any subsidiary of the Company shall
purchase shares of Common Stock pursuant to a tender offer or an exchange offer
for a price per share of Common Stock that is greater than the then Current
Market Value per share of Common Stock in effect at the end of the trading day
immediately following the day on which such tender offer or exchange offer
expires, then the number of shares of Common Stock thereafter with respect to
which the Holder of a CVR shall be entitled to a Contingent Value Payment upon
the exercise of each CVR shall be increased to a number determined by
multiplying the number of shares of Common Stock with respect to which the
Holder of a CVR shall be entitled to a Contingent Value Payment upon the
exercise of such CVR immediately prior to such purchase by a fraction the
numerator of which shall be the sum of (x) the fair market value of the
aggregate consideration payable to stockholders based on the acceptance (up to
any maximum specified in the terms of the tender offer or exchange offer) of all
shares of Common Stock validly tendered or exchanged and not withdrawn as of the
expiration time of such tender offer or exchange offer (the "Purchased Shares")
and (y) the product of the number of shares of Common Stock outstanding (less
the Purchased Shares) at the expiration time of such offer or exchange offer and
the first reported sales price of the Common Stock on the trading day
immediately following the day on which such tender offer or exchange offer
expires and the denominator of which shall be the number of shares of Common
Stock outstanding (including any Purchased Shares) at the expiration time of
such tender offer or exchange offer multiplied by the first reported sales price
of the Common Stock on the trading day immediately following the day on which
such tender offer or exchange offer expires, such increase to become effective
immediately prior to the opening of business on the day immediately following
the day on which such tender offer or exchange offer expires.
5.7 Other Events.
If any event occurs as to which the foregoing provisions of this Article 5
are not strictly applicable or, if strictly applicable, would not, in the good
faith judgment of the Board, fairly and adequately protect the purchase rights
of the CVRs in accordance with the essential intent and principles of such
provisions, then such Board shall make such adjustments in the application of
such provisions, in accordance with such essential intent and principles, as
shall be reasonably necessary, in the good faith opinion of such Board, to
protect such purchase rights as aforesaid, but in no event shall any such
adjustment have the effect of decreasing the amount of the Contingent Value
Payments payable upon exercise of this CVR.
5.8 Current Market Value.
For the purpose of any computation of Current Market Value under this
Section 5 , the "Current Market Value" per share of Common Stock at any date
shall be the average of the daily closing prices for the shorter of (i) the 20
consecutive trading days ending on the last full trading day on the exchange or
market specified in the second succeeding sentence prior to the Time of
Determination (as defined below) and (ii) the period commencing on the date next
succeeding the first public announcement of the issuance, sale, distribution or
granting in question through such last full trading day prior to the Time of
Determination. The term "Time of Determination" as used herein shall be the time
and date of the earlier to occur of (A) the date as of which the Current Market
Value is to be computed and (B) the last full trading day on such exchange or
market before the commencement of
19
"ex-dividend" trading in the Common Stock relating to the event giving rise to
the adjustment required by this Section 5. The closing price for any day shall
be the last reported sale price regular way or, in case no such reported sale
takes place on such day, the average of the closing bid and asked prices regular
way for such day, in each case (1) on the principal national securities exchange
on which the shares of Common Stock are listed or to which such shares are
admitted to trading or (2) if the Common Stock is not listed or admitted to
trading on a national securities exchange, in the over-the-counter market as
reported by the Nasdaq National Market or any comparable system or (3) if the
Common Stock is not listed on the Nasdaq National Market or a comparable system,
as furnished by two members of the NASD selected from time to time in good faith
by the Board for that purpose. In the absence of all of the foregoing, or if for
any other reason the Current Market Value per share cannot be determined
pursuant to the foregoing provisions of this Section 5.8, the Current Market
Value per share shall be the (x) the fair market value thereof determined in
good faith in the most recently completed arms'-length transaction between the
Company and a person other than an Affiliate of the Company and the closing of
which occurs on such date or shall have occurred within the three months
preceding such date or (y) if no transaction shall have occurred on such date or
within such three-month period, the fair market value thereof as determined by
an investment bank of nationally recognized standing selected by the Company and
acceptable to the CVR Agent. The Company shall pay the fees and expenses of any
investment bank involved in the determination of Current Market Value.
5.9 Superseding Adjustment.
Upon the expiration of any rights, options, warrants or conversion or
exchange privileges which resulted in the adjustments pursuant to this Article
5, if any thereof shall not have been exercised, the number of shares of Common
Stock with respect to a which Contingent Value shall be payable upon the
exercise of each CVR shall be readjusted as if (a) the only shares of Common
Stock issuable upon exercise of such rights, options, warrants, conversion or
exchange privileges were the shares of Common Stock, if any, actually issued
upon the exercise of such rights, options, warrants or conversion or exchange
privileges and (b) shares of Common Stock actually issued, if any, were issuable
for the consideration actually received by the Company upon such exercise plus
the aggregate consideration, if any, actually received by the Company for the
issuance, sale or grant of all such rights, options, warrants or conversion or
exchange privileges whether or not exercised; provided, however, that no such
readjustment shall (except by reason of an intervening adjustment under Section
5.1) have the effect of decreasing the number of shares of Common Stock with
respect to a which Contingent Value shall be payable upon the exercise of each
CVR by an amount in excess of the amount of the adjustment initially made in
respect of the issuance, sale or grant of such rights, options, warrants or
conversion or exchange privileges.
5.10 Minimum Adjustment.
The adjustments required by the preceding Sections of this Article 5 shall
be made whenever and as often as any specified event requiring an adjustment
shall occur, except that no adjustment of the number of shares of Common Stock
with respect to a which Contingent Value shall be payable upon exercise of CVRs
that would otherwise be required shall be made (except in the case of a
subdivision or combination of shares of Common Stock, as provided for in Section
5.1) unless and until such adjustment either by itself or with other adjustments
not previously made increases or decreases by at least 1% the number of shares
of Common Stock with respect to a which Contingent Value shall be payable upon
exercise of CVRs immediately prior to the making of such adjustment. Any
adjustment
20
representing a change of less than such minimum amount shall be carried forward
and made as soon as such adjustment, together with other adjustments required by
this Article 5 and not previously made, would result in a minimum adjustment.
For the purpose of any adjustment, any specified event shall be deemed to have
occurred at the close of business on the date of its occurrence. In computing
adjustments under this Article 5, fractional interests in Common Stock shall be
taken into account to the nearest one-hundredth of a share.
5.11 Notice of Adjustment.
Whenever the number of shares of Common Stock and other property, if any,
with respect to which a Contingent Value Payment shall be payable upon exercise
of CVRs is adjusted, as herein provided, the Company shall deliver to the CVR
Agent a certificate of a firm of independent accountants (who may be the regular
accountants employed by the Company) setting forth, in reasonable detail, the
event requiring the adjustment and the method by which such adjustment was
calculated (including a description of the basis on which the Board determined
the fair market value of any evidences of indebtedness, other securities or
property or warrants or other subscription or purchase rights), and specifying
the number of shares of Common Stock with respect to which a Contingent Value
Payment shall be payable upon exercise of CVRs after giving effect to such
adjustment. The CVR Agent shall promptly mail a copy of such certificate to each
Holder in accordance with Section 8.5. The CVR Agent shall be entitled to rely
on such certificate and shall be under no duty or responsibility with respect to
any such certificate, except to exhibit the same from time to time, to any
Holder desiring an inspection thereof during reasonable business hours. The CVR
Agent shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist which may require any adjustment of the
Contingent Value Payment or any component thereof or the number of shares of
Common Stock or other stock or property, with respect to which a Contingent
Value Payment shall be payable on exercise of the CVRs, or with respect to the
nature or extent of any such adjustment when made, or with respect to the method
employed in making such adjustment or the validity or value of any shares of
Common Stock.
5.12 Notice of Certain Transactions.
In the event that the Company shall propose (a) to pay any dividend payable
in securities of any class to the holders of its Common Stock or to make any
other distribution to the holders of its Common Stock, (b) to offer the holders
of its Common Stock rights to subscribe for or to purchase any securities
convertible into shares of Common Stock or shares of Common Stock or shares of
stock of any class or any other securities, rights or options, (c) to effect any
reclassification of its Common Stock, capital reorganization or Combination or
(d) to effect the voluntary or involuntary dissolution, liquidation or
winding-up of the Company, or in the event of a tender offer or exchange offer
described in Section 5.6, the Company shall within five Business Days send to
the CVR Agent and the Credit Agreement Agent and the CVR Agent shall within five
Business Days thereafter send the Holders a notice (in such form as shall be
furnished to the CVR Agent by the Company) of such proposed action or offer,
such notice to be mailed by the CVR Agent to the Holders at their addresses as
they appear in the Certificate Register, which shall specify the record date for
the purposes of such dividend, distribution or rights, or the date such issuance
or event is to take place and the date of participation therein by the holders
of Common Stock, if any such date is to be fixed, and shall briefly indicate the
effect of such action on the Common Stock and on the number and kind of any
other shares of stock and on other property, if any, and the number of shares of
Common Stock and other property, if any, purchasable upon exercise of
21
each CVR after giving effect to any adjustment which will be required as a
result of such action. Such notice shall be given by the Company as promptly as
possible and, in the case of any action covered by clause (a) or (b) above, at
least ten days prior to the record date for determining holders of the Common
Stock for purposes of such action and, in the case of any other such action, at
least 15 Business Days prior to the date of the taking of such proposed action
or the date of participation therein by the holders of Common Stock, whichever
shall be the earlier.
5.13 Adjustment to CVR Certificate.
The form of CVR Certificate need not be changed because of any adjustment
made pursuant to this Article 5, and CVR Certificates issued after such
adjustment may state the same number of shares of Common Stock as are stated in
any CVR Certificates issued prior to the adjustment. The Company, however, may
at any time in its sole discretion make any change in the form of CVR
Certificate that it may deem appropriate to give effect to such adjustments and
that does not affect the substance of the CVR Certificate, and any CVR
Certificate thereafter issued or countersigned, whether in exchange or
substitution for an outstanding CVR Certificate or otherwise, may be in the form
as so changed.
SECTION 6. RIGHTS OF HOLDERS
The Holders of the CVRs shall be entitled to the registration rights set
forth in Exhibit D hereto.
SECTION 7. CVR Agent
7.1 Appointment of CVR Agent.
The Company hereby appoints the CVR Agent to act as agent for the Company
in accordance with provisions of this Agreement and the CVR Agent hereby accepts
such appointment.
7.2 Rights and Duties of CVR Agent.
(a) In acting under this Contingent Value Right Agreement and in connection
with the CVR Certificates, the CVR Agent is acting solely as agent of the
Company and does not assume any obligation or relationship or agency or trust
for or with any of the holders of CVR Certificates or beneficial owners of CVRs.
(b) The CVR Agent may consult with counsel satisfactory to it, and the
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the advice of such counsel.
(c) The CVR Agent shall be protected and shall incur no liability for or in
respect of any action taken or thing suffered by it in reliance upon any CVR
Certificate, notice, direction, consent, certificate, affidavit, statement or
other paper or document
22
reasonably believed by it to be genuine and to have been presented or signed by
the proper parties.
(d) The CVR Agent shall be obligated to perform only such duties as are
herein and in the CVR Certificates specifically set forth and no implied duties
or obligations shall be read into this Agreement or the CVR Certificates against
the CVR Agent. The CVR Agent shall not be under any obligation to take any
action hereunder which may tend to involve it in any expense or liability for
which it does not receive indemnity if such indemnity is reasonably requested.
The CVR Agent shall not be accountable or under any duty or responsibility for
the use by the Company of any of the CVR Certificates countersigned by the CVR
Agent and delivered by it to the Holders or on behalf of the Holders pursuant to
this Agreement or for the application by the Company of the proceeds of the
CVRs. The CVR Agent shall have no duty or responsibility in case of any default
by the Company in the performance of its covenants or agreements contained
herein or in the CVR Certificates or in the case of the receipt of any written
demand from a Holder with respect to such default, including any duty or
responsibility to initiate or attempt to initiate any proceedings at law or
otherwise.
(e) The CVR Agent shall not at any time be under any duty or responsibility
to any Holder to determine whether any facts exist that may require an
adjustment of the number of shares of Common Stock with respect to which a
Contingent Value Payment shall be payable upon exercise of each CVR or with
respect to the nature or extent of any adjustment when made, or with respect to
the method employed, or herein or in any supplemental agreement provided to be
employed, in making the same. The CVR Agent shall not be accountable with
respect to the validity or value of any shares of Common Stock or of any
securities or property which may at any time be issued or delivered upon the
exercise of any CVR or upon any adjustment pursuant to Article 5, and it makes
no representation with respect thereto. The CVR Agent shall not be responsible
for any failure of the Company to make any cash payment or to issue, transfer or
deliver any shares of Common Stock or stock certificates upon the surrender of
any CVR Certificate for the purpose of exercise or upon any adjustment pursuant
to Article 5, or to comply with any of the covenants of the Company contained in
Article 5.
7.3 Individual Rights of CVR Agent.
The CVR Agent and any stockholder, director, officer or employee of the CVR
Agent may buy, sell or deal in any of the CVRs or other securities of the
Company or its affiliates or become pecuniarily interested in transactions in
which the Company or its affiliates may be interested, or contract with or lend
money to the Company or its affiliates or otherwise act as fully and freely as
though it were not the CVR Agent under this Agreement. Nothing herein shall
preclude the CVR Agent from acting in any other capacity for the Company or for
any other legal entity.
7.4 CVR Agent's Disclaimer.
The CVR Agent shall not be responsible for and makes no representation as
to the validity or adequacy of this Agreement or the CVR Certificates and it
shall not be responsible for any statement in this Agreement or the CVR
Certificates other than its
23
countersignature thereon.
7.5 Compensation and Indemnity.
The Company and the CVR Agent have entered into an agreement pursuant to
which the Company agrees to pay the CVR Agent from time to time reasonable
compensation for its services and to reimburse the CVR Agent upon request for
all reasonable out-of-pocket expenses incurred by it, including the reasonable
compensation and expenses of the CVR Agent's agents and counsel. The Company
shall indemnify the CVR Agent against any loss, liability or expense (including
agents' and attorneys' fees and expenses) incurred by it without willful
misconduct, gross negligence or bad faith on its part arising out of or in
connection with the acceptance or performance of its duties under this
Agreement. The CVR Agent shall notify the Company promptly of any claim for
which it may seek indemnity. The Company need not reimburse any expense or
indemnify against any loss or liability incurred by the CVR Agent through wilful
misconduct, gross negligence or bad faith. The Company's payment obligations
pursuant to this Section 7.5 shall survive the termination of this Agreement.
7.6 Successor CVR Agent.
(a) The Company agrees for the benefit of the Holders that there shall at
all times be a CVR Agent hereunder until all the CVRs have been exercised or are
no longer exercisable.
(b) The CVR Agent may at any time resign by giving written notice to the
Company of such intention on its part, specifying the date on which its desired
resignation shall become effective; provided, however, that such date shall not
be less than 30 days after the date on which such notice is given unless the
Company otherwise agrees. The CVR Agent hereunder may be removed at any time by
the filing with it of an instrument in writing signed by or on behalf of the
Company and specifying such removal and the date when it shall become effective,
which date shall not be less than 30 days after such notice is given unless the
CVR Agent otherwise agrees. Any removal under this Section 7.6 shall take effect
upon the appointment by the Company as hereinafter provided of a successor CVR
Agent (which shall be a bank or trust company authorized under the laws of the
jurisdiction of its organization to exercise corporate trust powers) and the
acceptance of such appointment by such successor CVR Agent.
(c) In case at any time the CVR Agent shall resign, or shall be removed, or
shall become incapable of acting, or shall be adjudged a bankrupt or insolvent,
or shall commence a voluntary case under national, or federal bankruptcy laws,
as now or hereafter constituted, or under any other applicable national, federal
or state bankruptcy, insolvency or similar law or shall consent to the
appointment of or taking possession by a receiver, custodian, liquidator,
assignee, trustee, sequestrator (or other similar official) of the CVR Agent or
its property or affairs, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts generally as
they become due, or shall take corporate action in furtherance of any such
action, or a decree or order for relief by a court having jurisdiction in the
premises shall have been entered in respect of the CVR Agent in an involuntary
case under the national or federal bankruptcy laws, as now or hereafter
constituted, or any other applicable national, federal or state bankruptcy,
insolvency or
24
similar law; or a decree order by a court having jurisdiction in the premises
shall have been entered for the appointment of a receiver, custodian,
liquidator, assignee, trustee, sequestrator (or similar official) of the CVR
Agent or of its property or affairs, or any public officer shall take charge or
control of the CVR Agent or of its property or affairs for the purpose of
rehabilitation, conservation, winding up of or liquidation, a successor CVR
Agent, qualified as aforesaid, shall be appointed by the Company by an
instrument in writing, filed with the successor CVR Agent. Upon the appointment
as aforesaid of a successor CVR Agent and acceptance by the successor CVR Agent
of such appointment, the CVR Agent shall cease to be CVR Agent hereunder;
provided, however, that in the event of the resignation of the CVR Agent
hereunder, such resignation shall be effective on the earlier of (i) the date
specified in the CVR Agent's notice of resignation and (ii) the appointment and
acceptance of a successor CVR Agent hereunder.
(d) Any successor CVR Agent appointed hereunder shall execute, acknowledge
and deliver to its predecessor and to the Company an instrument accepting such
appointment hereunder, and thereupon such successor CVR Agent, without any
further act, deed or conveyance, shall become vested with all the rights and
obligations of such predecessor (save to the extent of any accrued liabilities
which shall continue to bind the outgoing CVR Agent) with like effect as if
originally named as CVR Agent hereunder, and such predecessor, upon payment of
sums owing to it hereunder then unpaid, shall thereupon become obligated to
transfer, deliver and pay over, and such successor CVR Agent shall be entitled
to receive, all monies, securities and other property on deposit with or held by
such predecessor, as CVR Agent hereunder.
(e) Any corporation into which the CVR Agent hereunder may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the CVR Agent shall be a party, or any corporation to which the CVR Agent
shall sell or otherwise transfer all or substantially all the assets and
business of the CVR Agent, provided that it shall be qualified as aforesaid,
shall be the successor CVR Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto.
SECTION 8. Miscellaneous
8.1 Reports
(a) As soon as any CVR becomes outstanding, the Company shall provide the
CVR Agent and Holders with such financial statements and reports as are
distributed to holders of Common Stock generally.
(b) The Company hereby agrees with each Holder, for so long as any CVRs
remain outstanding and during any period in which the Company is not subject to
Section 13 or 15(d) of the Exchange Act, to make available, upon request of any
Holder, to any Holder or beneficial owner of CVRs in connection with any sale
thereof and any prospective purchaser thereof from such Holder or beneficial
owner, the information required by Rule 144A(d)(4) under the Securities Act in
order to permit resales pursuant to Rule 144A.
8.2 Persons Benefitting.
25
Nothing in this Agreement is intended or shall be construed to confer upon
any Person other than the Company, the CVR Agent and the Holders any right,
remedy or claim under or by reason of this agreement or any part hereof.
8.3 Rights of Holders.
Holders of unexercised CVRs are not, for the avoidance of doubt, entitled
(a) to receive dividends or other distributions, (b) to receive notice of or
vote at any meeting of the stockholders of the Company, (c) to consent to any
action of the stockholders of the Company, (d) to receive notice of any other
proceedings of the Company or (e) to exercise any other rights as stockholders
of the Company.
8.4 Amendment.
This Agreement may be amended by the parties hereto without the consent of
any Holder for the purpose of curing any ambiguity, or of curing, correcting or
supplementing any defective provision contained herein or making any other
provisions with respect to matters or questions arising under this Agreement as
the Company and the CVR Agent may deem necessary or desirable; provided,
however, that such action shall not affect adversely the rights of the Holders.
Any amendment or supplement to this Agreement (including any Exhibit hereto)
that has or would have an adverse effect on the interests of the Holders shall
require the written consent of the Holders of a majority of the outstanding CVRs
or, if no CVRs are outstanding, the Initial Lenders in each case, by value. The
consent of each Holder affected shall be required for any amendment pursuant to
which the Contingent Value Payment would be decreased or the number of Shares of
Common Stock with respect to which a Contingent Value Payment shall be payable
upon exercise of CVRs would be decreased (other than pursuant to adjustments
provided herein). In determining whether the Holders of the required number of
CVRs have concurred in any direction, waiver or consent, CVRs 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 disregarded
and deemed not to be outstanding, except that, for the purpose of determining
whether the CVR Agent shall be protected in relying on any such direction,
waiver or consent, only CVRs which the CVR Agent knows are so owned shall be so
disregarded. Also, subject to the foregoing, only CVRs outstanding at the time
shall be considered in any such determination.
8.5 Notices.
Any notice or communication shall be in writing and delivered in Person or
mailed by first-class mail addressed as follows:
if to the Company: PrimaCom AG
Xxxxxxxxxxx 00
00000 Xxxxx
Xxxxxxx
Attention: Corporate Counsel
with a copy to:
Xxxxx & XxXxxxxx
26
000 Xxx Xxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: Xxxxxxxx Xxxxx
Telecopy: x00-(0)00-000-0000
if to the CVR Agent:
Chase Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
if to the Credit Agreement Agent:
Chase Manhattan International Limited
000 Xxxxxx Xxxx
Xxxxxx XX0X 0XX
Attention: Xxx X. Xxxxxx
Telecopy: x00 (0) 000 000 0000
The Company or the CVR Agent or the Credit Agreement Agent by notice to the
other may designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder shall be mailed to the
Holder at the Holder's address as it appears on the Certificate Register and
shall be sufficiently given if so mailed within the time prescribed.
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, it is duly given, whether
or not the addressee receives it.
8.6 GOVERNING LAW.
THIS AGREEMENT AND THE CVR CERTIFICATES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
8.7 Successors.
All agreements of the Company in this Agreement and the CVR Certificates
shall bind its successors. All agreements of the CVR Agent in this Agreement
shall bind its successors.
8.8 Counterparts.
This Agreement may be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument.
8.9 Table of Contents.
27
The table of contents and headings of the Articles and Sections of this
Agreement have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
8.10 Severability.
The provisions of this Agreement are severable, and if any clause or
provision shall be held invalid, illegal or unenforceable in whole or in part in
any jurisdiction, then such invalidity or unenforceability shall affect in that
jurisdiction only such clause or provision, or part thereof, and shall not in
any manner affect such clause or provision in any other jurisdiction or any
other clause or provision of this Agreement in any jurisdiction.
28
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first written above.
PRIMACOM AG
------------------------------------
By:
Name:
Title:
CHASE SECURITIES INC., as CVR
Agent
------------------------------------
By:
Name:
Title:
29
EXHIBIT A
TO
CONTINGENT VALUE RIGHT AGREEMENT
[FORM OF FACE OF CVR CERTIFICATE]
THE CVRs HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS CVR NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION AND
SUBJECT TO COMPLIANCE WITH OTHER APPLICABLE LAWS. THE HOLDER HEREOF, BY ITS
ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH CVR, UNLESS
PREVIOUSLY REGISTERED UNDER THE SECURITIES ACT, ONLY (A) TO THE COMPANY; (B)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE); (C) TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A; (D) PURSUANT TO AN OFFSHORE TRANSACTION COMPLYING WITH
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT: OR (E) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
No. __ Certificate for ___ CVRs
THIS CERTIFIES THAT, ____________, or its registered assigns, is the
registered holder of the number of CVRs set forth above (the "CVRs"). Each CVR
entitles the holder thereof (the "Holder"), at its option and subject to the
provisions contained herein and in the Contingent Value Right Agreement referred
to below, to require PrimaCom AG, a company organized under the laws of Germany
("the Company"), to pay to the Holder an amount equal to the difference between
(a) the Exercise Date Market Price and (b) 110% of the Current Market Price one
share of Common Stock, no par value, of the Company (the "Common Stock") on the
date on which the CVRs are released from escrow, unless, at the option of the
Company, the Company instead effects a Share Settlement Exercise. This CVR
Certificate shall terminate and become void as of the close of business on
September 18, 2010 (the "Expiration Date") or upon the exercise hereof as to all
the shares of Common Stock subject hereto. The number of shares with respect to
which the Contingent Value Payment shall be payable upon exercise of the CVRs
and the Contingent Value Payment per share shall be subject to adjustment from
time to time as set forth in the Contingent Value Right Agreement. "Current
Market Price" shall mean, on any date, the greater of (1) the average of the
last reported sale price of the Company's shares traded on the Nasdaq National
Market for each business day during the period commencing 20 business days
before such date and ending on the date one day prior to such date; and (2) the
market price called for under a calculation under Rule 144A(d)(3)(i) of the
Securities Act.
30
This CVR Certificate is issued under and in accordance with a Contingent
Value Right Agreement dated as of September 18, 2000 (the "Contingent Value
Right Agreement"), between the Company and Chase Securities Inc. (the "CVR
Agent", which term includes any successor CVR Agent under the Contingent Value
Right Agreement), and is subject to the terms and provisions contained in the
Contingent Value Right Agreement, to all of which terms and provisions the
Holder of this CVR Certificate consents by acceptance hereof. The Contingent
Value Right Agreement is hereby incorporated herein by reference and made a part
hereof. Reference is hereby made to the Contingent Value Right Agreement for a
full statement of the respective rights, limitations of rights, duties and
obligations of the Company, the CVR Agent and the Holders of the CVRs.
Capitalized terms used but not defined herein shall have the meanings ascribed
thereto in the Contingent Value Right Agreement. A copy of the Contingent Value
Right Agreement may be obtained for inspection by the Holder hereof upon written
request to the CVR Agent at Chase Securities Inc. [Address].
Subject to the terms of the Contingent Value Right Agreement, the CVRs may
be exercised in whole or in part by surrender of this CVR Certificate with the
form of election to exercise CVRs attached hereto duly executed to the CVR Agent
at the office of the CVR Agent.
As provided in the Contingent Value Right Agreement and subject to the
terms and conditions therein set forth, the CVRs shall be exercisable at any
time from and after they have been released from escrow under the terms of the
Contingent Value Right Agreement; provided, however, that no CVR shall be
exercisable after the Expiration Date.
The Company may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with the transfer or
exchange of the CVR Certificates pursuant to Section 2.4 of the Contingent Value
Right Agreement but not for any exchange or original issuance (not involving a
transfer) with respect to temporary CVR Certificates, the exercise of the CVRs.
Upon any partial exercise of the CVRs, there shall be countersigned and
issued to the Holder hereof a new CVR Certificate in respect of the shares of
Common Stock as to which the CVRs shall not have been exercised. This CVR
Certificate may be exchanged at the office of the CVR Agent by presenting this
CVR Certificate properly endorsed with a request to exchange this CVR
Certificate for other CVR Certificates evidencing an equal number of CVRs.
The CVRs do not entitle any holder hereof to any of the rights of a
stockholder of the Company. All shares of Common Stock issuable by the Company
upon Cashless Exercise of the CVRs shall, upon such issue, be duly and validly
issued and fully paid and non-assessable.
The holder in whose name the CVR Certificate is registered may be deemed
and treated by the Company and the CVR Agent as the absolute owner of the CVR
Certificate for all purposes whatsoever and neither the Company nor the CVR
Agent shall be affected by notice to the contrary.
This CVR Certificate shall not be valid or obligatory for any purpose until
it shall have been countersigned by the CVR Agent.
31
[-------------------------------]
By _____________________________
[SEAL]
Attest: ___________________________
Secretary
DATED:
Countersigned:
CHASE SECURITIES INC.
as CVR Agent
By _________________________________
Authorized Signatory
32
EXHIBIT B
TO
CONTINGENT VALUE RIGHT AGREEMENT
FORM OF ELECTION TO EXERCISE CVRs
(to be executed only upon exercise of CVRs)
[ ]
The undersigned hereby irrevocably elects to exercise [ _______ ] CVRs to
require PrimaCom AG to pay to the undersigned an amount equal to the difference
between (a) the Exercise Date Market Price and (b) 110% of the Current Market
Price (as the same may be adjusted pursuant to Article 5 of the Contingent Value
Right Agreement), on the terms and conditions specified in the within CVR
Certificate and the Contingent Value Right Agreement therein referred to,
surrenders this CVR Certificate and all right, title and interest therein to
PrimaCom AG, and directs that the proceeds payable upon the exercise of such
CVRs be paid to the undersigned by wire transfer or certified check as specified
below.
Date: ________________, ____
_______________________________1
(Signature of Owner)
________________________________
(Xxxxxx Xxxxxxx)
______________________________________
(City) (State) (Zip Code)
Signature Guaranteed by:
______________________________________
Check to be issued to:
Please insert social security or identifying number:
______________________________________
33
2
Name:
Street Address:
City, State and Zip Code:
Any unexercised CVRs evidenced by the within CVR Certificate to be issued to:
Please insert social security or identifying number:
Name:
Street Address:
City, State and Zip Code:
34
EXHIBIT C
TO
CONTINGENT VALUE RIGHT AGREEMENT
The following exchanges of a part of this Global CVR for definitive CVRs have
been made:
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION OF TRANSFER OF CVRs
Re: CVRs of PrimaCom AG (the "Company")
This Certificate relates to __________ CVRs held in definitive form by
_______________ (the "Transferor").
The Transferor has requested the CVR Agent by written order to exchange or
register the transfer of a CVR or CVRs. In connection with such request and in
respect of each such CVR, the Transferor does hereby certify that the Transferor
is familiar with the Contingent Value Right Agreement relating to the above
captioned CVRs and that the transfer of this CVR does not require registration
under the Securities Act of 1933 (the "Securities Act"), because(1):
[ ] Such CVR is being acquired for the Transferor's own account without
transfer.
[ ] Such CVR is being transferred to the Company.
[ ] Such CVR is being transferred in a transaction meeting the requirements
of Rule 144 under the Securities Act.
[ ] Such CVR is being transferred to a qualified institutional buyer (as
defined in Rule 144A under the Securities Act), in reliance on
Rule 144A.
[ ] Such CVR is being transferred pursuant to an offshore transaction in
accordance with Rule 904 under the Securities Act.
[ ] Such CVR is being transferred pursuant to another available exemption
from the registration requirements under the Securities Act.
The CVR Agent and the Company are entitled to rely upon this Certificate
and are irrevocably authorized to produce this Certificate or a copy hereof to
any interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby.
-------------
1. Please check applicable box.
35
2
[INSERT NAME OF TRANSFEROR]
by ________________________
Date: ____________________
36
ANNEX A
Release Certificate (Sale)
As an authorized representative of __________________, an Initial Lender
and the holder (the "Holder") of euro____________ principal amount of
Indebtedness of PrimaCom AG in the form of Initial Loans, Term Loans or Exchange
Notes, the undersigned hereby certifies (i) that the Holder intends to engage in
a bona fide arms-length transaction for the sale of such Indebtedness; and (ii)
that in order to effectuate the sale of such Initial Loans, Term Loans or
Exchange Notes at a price not greater than the unpaid principal amount thereof
plus accrued and unpaid interest thereon, it will be necessary to accompany the
transfer thereof with a transfer of CVRs now being held in escrow by Chase
Manhattan International Limited (the "CVR Escrow Agent").
Upon receipt of this duly completed Release Certificate, the CVR Escrow
Agent is hereby instructed to release to the Holder ______ CVRs, as provided
under Section 4.2 of the Contingent Value Right Agreement between PrimaCom AG
and Chase Securities Inc., dated as of September 18, 2000. All such CVRs will be
transferred with Initial Loans, Term Loans or Exchange Notes to the purchaser
thereof.
Date: _____________________ ______________________________
Authorized Representative
37
ANNEX B
Release Certificate (Earn-In)
As an authorized representative of, an Initial Lender and a holder (the
"Holder") of Indebtedness of PrimaCom AG in the form of Initial Loans, Term
Loan, or Exchange Notes, the undersigned hereby certifies (i) that on the
Closing Date Holder was an Initial Lender of Initial Loans; and (ii) as of the
most recent Release Date occurring on or prior to the date of this Release
Certificate, Holder continued to be the owner of Initial Loans, Term Loans or
Exchange Notes.
Upon receipt of this duly completed Release Certificate, the CVR Escrow
Agent is hereby instructed to release to the Holder _________ CVRs, as provided
under Section 4.3 of the Contingent Value Right Agreement between PrimaCom AG
and Chase Securities Inc. dated as of September 18, 2000.
[ ] By checking this box, the undersigned hereby further declares
that the Holder wishes to automatically receive accrued CVRs
due to the Holder upon each future Release Date, and instruct
the CVR Escrow Agent to mail such accrued CVRs to the Holder
at the Holder's address of record after each Release Date.
Date: _____________________ ______________________________
Authorized Representative
38
ANNEX C
Release Certificate (Retirement)
As an authorized representative of _______________, I hereby certify that
PrimaCom AG (the "Company") has retired or cancelled [the entire][euro____]
principal amount, including accrued interest thereon, of the indebtedness
represented by the Initial Loans and/or the Term Loans issued under the
Agreement referred to below and any Exchange Notes of the Company issued in
exchange for such Term Loans. The undersigned therefore requests that Chase
Manhattan International Limited, as CVR Escrow Agent release [any] [ ] unearned
CVRs for the Common Stock of the Company remaining in escrow as of the date
thereof, and deliver such CVRs to Chase Securities Inc. (the "CVR Agent") for
cancellation.
Date: _____________________ ______________________________
By:___________________________
As the authorized representative of Chase Manhattan
International Limited, which serves as the Administrative Agent under the terms
of the Senior Working Capital Credit Agreement (the "Agreement") dated as of
September 18, 2000 among the Company and the several lenders parties thereto and
Chase Manhattan International Limited, as Administrative Agent, I hereby certify
that the Company has retired or cancelled [the entire] [euro ] amount,
including principal, accrued interest and fees thereon, of the indebtedness
incurred under the terms of the Agreement and any Exchange Notes issued in
exchange therefor, and is therefore entitled to the release of [all] [euro ____
] of the remaining unearned CVRs for the Common Stock of PrimaCom AG from
Escrow.
Date: _____________________ ______________________________
By:___________________________
00
XXXXX X
Xxxxxx X Xxxxxx X
-------- --------
Three Months After June 30, 2001 25%
Six Months After June 30, 2001 50%
Nine Months After June 30, 2001 75%
Twelve Months After June 30, 2001 100%
