Execution Copy
$400,000,000 9 3/4% SENIOR NOTES DUE 2008
TIME WARNER TELECOM LLC
AND
TIME WARNER TELECOM INC.
UNDERWRITING AGREEMENT
July 16, 1998
July 16, 1998
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Brothers Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Time Warner Telecom LLC, a Delaware limited liability company
("TIME WARNER"), and Time Warner Telecom Inc., a Delaware corporation and wholly
owned subsidiary of Time Warner (the "COMPANY" and, together with Time Warner,
the "OBLIGORS"), propose to issue and sell to the several Underwriters named in
Schedule I hereto (the "UNDERWRITERS") $400,000,000 aggregate principal amount
of their 9 3/4% Senior Notes due 2008 (the "NOTES") to be issued pursuant to the
provisions of an Indenture to be dated as of the Closing Date (as defined below)
(the "INDENTURE") between the Obligors and The Chase Manhattan Bank (the
"TRUSTEE").
Time Warner and the Company were recently formed in connection
with a reorganization (the "REORGANIZATION") of certain assets and liabilities
previously owned by subsidiaries and divisions of Time Warner Entertainment
Company, L.P. ("TWE"), Time Warner Entertainment-Advance/Xxxxxxxx Partnership
("TWE-A/N") and Time Warner Inc. ("TW") pursuant to a Reorganization Agreement
dated as of July 14, 1998 (the "REORGANIZATION AGREEMENT"), among Time Warner
Companies, Inc. ("TWC"), MediaOne Group, Inc. ("MEDIAONE"), Advance/Xxxxxxxx
Partnership ("XXXXXXXX"), TWE and TWE- A/N. The Reorganization was consummated
on July 14, 1998.
The Obligors have filed with the Securities and Exchange
Commission (the "COMMISSION") a registration statement, including a prospectus,
relating to the Notes. The registration statement as amended at the time it
becomes effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Securities Act of 1933, as amended (the "SECURITIES ACT"), is hereinafter
referred to as the "REGISTRATION STATEMENT"; the prospectus in the form first
used to confirm sales of Notes is hereinafter referred to as the "PROSPECTUS."
If the Company has filed an abbreviated registration statement to register
additional Notes pursuant to Rule 462(b) under the Securities Act (the "RULE 462
REGISTRATION STATEMENT"), then any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462 Registration Statement.
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1. Representations and Warranties. (A) The Obligors represent
and warrant to and agree with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or, to
the knowledge of Time Warner or the Company, threatened by the
Commission.
(b) (i) The Registration Statement, when it became effective,
did not contain and, as amended or supplemented, if applicable, will
not contain any 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, (ii) the Registration Statement and
the Prospectus comply and, as amended or supplemented, if applicable,
will comply in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder and (iii)
the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this paragraph do not apply (A) to statements or omissions in the
Registration Statement or the Prospectus, or any amendment or
supplement thereto, based upon information relating to any Underwriter
furnished to the Obligors in writing by such Underwriter through you
expressly for use therein or (B) to that part of the Registration
Statement that constitutes the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of 1939, as
amended (the "TRUST INDENTURE ACT"), of the Trustee.
(c) Time Warner has been duly formed and is validly existing
as a limited liability company in good standing under the laws of
Delaware, has the requisite limited liability company power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on Time Warner and
its subsidiaries, taken as a whole.
(d) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification,
except to the extent that the failure to be
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so qualified or be in good standing would not have a material adverse
effect on Time Warner and its subsidiaries, taken as a whole.
(e) Each subsidiary of Time Warner has been duly incorporated
or, in the case of partnerships or limited liability companies, duly
organized, is validly existing as a corporation, a partnership or a
limited liability company, as the case may be, in good standing under
the laws of the jurisdiction of its incorporation or organization, has
the power and authority to own its property and to conduct its business
as described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on Time Warner and its subsidiaries, taken as a whole;
all of the issued shares of capital stock of each subsidiary of Time
Warner that is a corporation have been duly and validly authorized and
issued, are fully paid and non-assessable and are owned directly or
indirectly by Time Warner, free and clear of all liens, encumbrances,
equities or claims; and all of the partnership interests and membership
interests in each subsidiary of Time Warner that is a partnership or a
limited liability company, as the case may be, are owned directly or
indirectly by Time Warner, free and clear of all liens, encumbrances,
equities or claims.
(f) This Agreement has been duly authorized, executed and
delivered by Time Warner and the Company.
(g) The Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized by each of the Obligors and,
when duly executed and delivered by the Obligors on the Closing Date,
assuming due authorization, execution and delivery by the Trustee, will
constitute a valid and binding agreement of each of the Obligors,
enforceable in accordance with its terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability.
(h) The Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture, and
delivered to and paid for by the Underwriters in accordance with the
terms of this Agreement, will be entitled to the benefits of the
Indenture, and will be valid and binding obligations of each of the
Obligors, enforceable in accordance with their terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability.
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(i) The Reorganization Agreement has been duly authorized,
executed and delivered by each of the parties thereto and is a valid
and binding agreement of each of the parties thereto, enforceable in
accordance with its terms except as (i) the enforceability thereof may
be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable
principles of general applicability.
(j) No consent, approval, waiver or authorization that is
material to Time Warner and its subsidiaries taken as a whole is
required to be obtained by any of the parties to the Reorganization
Agreement, and no notice or filing that is material to Time Warner and
its subsidiaries taken as a whole is required to be given by such
parties to, or made by such parties to, or made by such parties with,
any federal, state, local or other governmental authority or any other
person in connection with the execution, delivery and performance by
such parties of the Reorganization Agreement.
(k) The execution, delivery and performance of the
Reorganization Agreement by the parties thereto, and the consummation
of the transactions contemplated thereby, does not and will not (i)
violate any provision of the charter or bylaws or partnership agreement
or other organizational documents of such parties or (ii) violate or
result in a breach of or constitute a default under any law of any
country or governmental authority to which such party is subject.
(l) The execution and delivery by each of the Obligors of, and
the performance by the Obligors of their respective obligations under,
this Agreement, the Indenture and the Notes will not contravene any
provision of applicable law or the certificate of incorporation or the
certificate of formation, as applicable, or by-laws or limited
liability company agreement, as applicable, of the Obligors or any
agreement or other instrument binding upon either of the Obligors or
any of their subsidiaries that is material to Time Warner and its
subsidiaries, taken as a whole, or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over Time Warner
or any of its subsidiaries, and no consent, approval, authorization or
order of, or qualification with, any governmental body or agency is
required for the performance by the Obligors of their respective
obligations under this Agreement, except (1) such as may have been
obtained and (2) such as may be required by the securities or Blue Sky
laws of the various states and other jurisdictions in connection with
the offer and sale of the Notes.
(m) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of Time Warner and its
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subsidiaries, taken as a whole, from that set forth in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement).
(n) There are no legal or governmental proceedings pending or,
to the knowledge of the Obligors, threatened to which either of the
Obligors or any of their subsidiaries is a party or to which any of the
properties of either of the Obligors or any of their subsidiaries is
subject that are required to be described in the Registration Statement
or the Prospectus and are not so described or any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement that are not described
or filed as required.
(o) Each preliminary prospectus filed as part of the
registration statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder.
(p) Neither of the Obligors is, and after giving effect to the
offering and sale of the Notes and the application of the proceeds
thereof as described in the Prospectus, neither will be, an "investment
company" as such term is defined in the Investment Company Act of 1940,
as amended.
(q) The Obligors and their subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on Time Warner and its subsidiaries, taken as a
whole.
(r) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate,
have a material adverse effect on Time Warner and its subsidiaries,
taken as a whole.
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(s) Except as set forth in the Prospectus, there are no
contracts, agreements or understandings between Time Warner or the
Company and any person granting such person the right to require Time
Warner or the Company to file a registration statement under the
Securities Act with respect to any securities of Time Warner or the
Company or to require Time Warner or the Company to include such
securities with the Notes registered pursuant to the Registration
Statement.
(t) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, (1) neither
Time Warner, nor any of its subsidiaries has incurred any material
liability or obligation, direct or contingent, nor entered into any
material transaction not in the ordinary course of business; (2)
neither Time Warner, nor any of its subsidiaries has purchased any of
Time Warner's outstanding Interests (as defined in the Prospectus), nor
has Time Warner declared, paid or otherwise made any distribution of
any kind on its Interests other than ordinary and customary
distributions; and (3) there has not been any material change in the
Interests, short-term debt or long-term debt of Time Warner and its
subsidiaries, taken as a whole, except in each case as set forth or
described in the Prospectus.
(u) The Obligors and their subsidiaries have good and
marketable title in fee simple to all real property and good marketable
title to all personal property owned by them, in each case free and
clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Obligors and their
subsidiaries or such as do not, singly or in the aggregate, have or
could not result in a material adverse effect on Time Warner and its
subsidiaries, taken as a whole; and any real property and buildings
held under lease by the Obligors and their subsidiaries are held by
them under valid, subsisting and enforceable leases with such
exceptions as do not interfere with the use made and proposed to be
made of such property and buildings by the Obligors and their
subsidiaries or such as do not, singly or in the aggregate, have or
could not result in a material adverse effect on Time Warner and its
subsidiaries, taken as a whole, in each case except as described in the
Prospectus.
(v) Except as set forth in the Prospectus, the Obligors and
their subsidiaries own or possess, or can acquire on reasonable terms,
all patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names, currently employed by them
in connection with the business now operated by them, except where the
failure to own or possess or to have the right to acquire any of the
foregoing, singly or in the aggregate, does not have a material adverse
effect on Time Warner and its subsidiaries, taken as a whole,
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and neither the Obligors nor any of their subsidiaries has received any
notice of infringement of or conflict with asserted rights of others
with respect to any of the foregoing which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would
have a material adverse effect on Time Warner and its subsidiaries,
taken as a whole.
(w) No labor dispute with the employees of the Obligors or any
of their subsidiaries exists, except as described in the Prospectus,
or, to the knowledge of the Obligors, is imminent, except for disputes
that do not or would not have a material adverse effect on Time Warner
and its subsidiaries taken as a whole; and the Obligors are not aware
of any existing, threatened or imminent labor disturbance by the
employees of any of their principal suppliers or contractors that could
have a material adverse effect on Time Warner and its subsidiaries,
taken as a whole.
(x) The Obligors and their subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; and neither of the Obligors nor
any of their respective subsidiaries has any reason to believe that it
will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business at a cost that
would not have a material adverse effect on Time Warner and its
subsidiaries, taken as a whole, except as described in the Prospectus.
(y) The Obligors and their subsidiaries possess all permits,
licenses, rights of way, approvals, consents and other authorizations
issued by the appropriate federal, state, local or foreign regulatory
agencies or bodies (including the Federal Communications Commission
(the "FCC"), the public utilities commission, or any equivalent body,
of each state in which the Obligors do business and any other relevant
State or local governmental department, commission, board, bureau,
agency, court or other authority thereof (the "LOCAL AUTHORITIES")
required for the conduct of the telecommunications business now
operated by them (collectively, the "GOVERNMENTAL LICENSES"), except
where the failure to possess any such Governmental Licenses would not,
singly or in the aggregate, have a material adverse effect on Time
Warner and its subsidiaries, taken as a whole; the Obligors and their
subsidiaries are in compliance with the terms and conditions of all
such Licenses, except where the failure so to comply would not, singly
or in the aggregate, have a material adverse effect on Time Warner and
its subsidiaries, taken as a whole; all of the Governmental Licenses
are valid and in full force and effect, except where the invalidity of
such Governmental Licenses or the failure of such Governmental Licenses
to be in full force and effect would not, singly or in the aggregate,
have a material adverse effect on Time Warner and its subsidiaries,
taken as a whole; there is no outstanding adverse judgment, decree
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or order that has been issued by the FCC or any of the Local
Authorities against the Obligors or any of their subsidiaries and
which, singly or in the aggregate, would have a material adverse effect
on Time Warner and its subsidiaries, taken as a whole; and neither the
Obligors nor any of their subsidiaries has received any notice of or is
aware of proceedings relating to the revocation or modification of any
such Governmental Licenses or, except as set forth in the Prospectus,
that would otherwise affect the operations of the Obligors or their
subsidiaries and which, singly or in the aggregate, would have a
material adverse effect on Time Warner and its subsidiaries, taken as a
whole.
(z) The Obligors and each of their subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (1) transactions are executed in accordance with
management's general or specific authorizations; (2) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (3) access to assets is permitted only
in accordance with management's general or specific authorization; and
(4) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
2. Agreements to Sell and Purchase. The Obligors hereby agree
to sell to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Obligors the respective principal amounts of Notes set forth in Schedule I
hereto opposite its name at 97.25% of their principal amount with respect to the
Notes (the "PURCHASE PRICE") plus accrued interest, if any, from July 21, 1998
to the date of payment and delivery.
3. Terms of Public Offering. The Company is advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Notes as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable. The Company is
further advised by you that (a) the Notes are to be offered to the public
initially at 100% of the principal amount (the "PUBLIC OFFERING PRICE") plus
accrued interest, if any, and to certain dealers selected by you at a price that
represents a concession not in excess of .25% of their principal amount under
the Public Offering Price, and that any Underwriter may allow, and such dealers
may reallow, a concession, not in excess of .125% of their principal amount, to
any Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Notes shall be made
to the Company in Federal or other funds immediately available in New York City
against delivery of such Notes for the respective accounts of the several
Underwriters at the offices of
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Shearman & Sterling, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 a.m.,
New York City time, on July 21, 1998, or at such other time on the same or such
other date, not later than July 28, 1998, as shall be designated in writing by
you. The time and date of such payment are hereinafter referred to as the
"CLOSING DATE."
Certificates for the Notes shall be in definitive form and
registered in such names and in such denominations as you shall request in
writing not later than one full business day prior to the Closing Date. The
certificates evidencing the Notes shall be delivered to you on the Closing Date
for the respective accounts of the several Underwriters, with any transfer taxes
payable in connection with the transfer of the Notes to the Underwriters duly
paid, against payment of the Purchase Price therefor.
5. Conditions to the Underwriters' Obligations. The
obligations of the Company to sell the Notes to the Underwriters and the several
obligations of the Underwriters to purchase and pay for the Notes on the Closing
Date are subject to the condition that the Registration Statement shall have
become effective not later than 5:30 p.m. (New York City time) on the date
hereof.
The several obligations of the Underwriters are subject to the
following further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
(i) there shall not have occurred any downgrading,
nor shall any notice have been given of any intended or
potential downgrading or of any review for a possible change
that does not indicate the direction of the possible change,
in the rating accorded any of Time Warner's or the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or
operations of Time Warner and its subsidiaries, taken as a
whole, from that set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of
this Agreement) that, in your judgment, is material and
adverse and that makes it, in your judgment, impracticable to
market the Notes on the terms and in the manner contemplated
in the Prospectus.
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(b) The Underwriters shall have received on the Closing Date a
certificate from each of Time Warner and the Company, dated the Closing
Date and signed by an executive officer of Time Warner and the Company,
respectively, to the effect set forth in Section 5(a)(i) above and to
the effect that the representations and warranties of the Obligors
contained in this Agreement are true and correct as of the Closing Date
and that the Obligors have complied with all of the agreements and
satisfied all of the conditions on their part to be performed or
satisfied hereunder on or before the Closing Date.
The officer signing and delivering each such certificate may
rely upon the best of his or her knowledge as to proceedings
threatened.
(c) The Underwriters shall have received on the Closing Date
an opinion of Xxxxxxx, Xxxxxx & Xxxxx, outside counsel for the
Obligors, dated the Closing Date, to the effect that:
(i) based solely on a certificate of good standing
from the Secretary of State of the State of Delaware, Time
Warner has been duly formed, and is validly existing as a
limited liability company in good standing under the laws of
Delaware, with full limited liability company power and
authority to own its property and to conduct its business as
described in the Prospectus;
(ii) based solely on a certificate of good standing
from the Secretary of State of the State of Delaware, the
Company has been duly incorporated, and is validly existing
and in good standing under the laws of the State of Delaware,
with full corporate power and authority to own its property
and to conduct its business as described in the Prospectus;
(iii) the Notes have been duly authorized by each of
the Obligors, and, when executed and authenticated in
accordance with the provisions of the Indenture, and delivered
to and paid for by the Underwriters pursuant to the
Underwriting Agreement, will constitute legal, valid and
binding obligations of each of the Obligors, entitled to the
benefits of the Indenture and enforceable against each of them
in accordance with their terms (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and other similar laws affecting creditors' rights
generally and general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether in a proceeding
in equity or at law);
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(iv) the Indenture has been duly authorized, executed
and delivered by each of the Obligors, has been duly qualified
under the Trust Indenture Act of 1939 and constitutes a legal,
valid and binding obligation of each of the Obligors
enforceable against each of them in accordance with its terms
(subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance and other similar laws
affecting creditors' rights generally and general principles
of equity including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing,
regardless of whether in a proceeding in equity or at law);
(v) this Agreement has been duly authorized, executed
and delivered by each of Time Warner and the Company;
(vi) the Reorganization Agreement has been duly
authorized, executed and delivered by TWC, TWE-A/N and TWE,
and constitutes a valid and binding agreement of each of TWC,
TWE-A/N and TWE, enforceable against each of them in
accordance with its terms (subject to applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance
and other similar laws affecting creditors' rights generally
and general principles of equity including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether in a proceeding
in equity or at law);
(vii) the execution and delivery by the Obligors of,
and the performance by the Obligors of their respective
obligations under, this Agreement, the Indenture or the Notes
will not contravene any provision of applicable law or the
certificate of incorporation or the certificate of formation,
as applicable, or by-laws or limited liability company
agreement, as applicable, of the Obligors or, to such
counsel's knowledge, any agreement or other instrument binding
upon either of the Obligors or any of their subsidiaries that
is material to Time Warner and its subsidiaries, taken as a
whole, or, to the best of such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Obligors or any of their
subsidiaries, and no consent, approval, authorization or order
of, or qualification with, any governmental body or agency is
required for the performance by the Obligors of their
obligations under this Agreement, except such as has been
obtained under the Securities Act and such as may be required
by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Notes by the
Underwriters;
(viii) the statements (A) in the Prospectus under the
captions "Certain Relationships and Related Transactions,"
"Description of Interests," "Certain
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United States Federal Tax Consequences to Holders of Notes,"
"Description of Capital Stock" and "Description of the Notes"
and (B) in the Registration Statement in Items 14 and 15, in
each case insofar as such statements constitute summaries of
the legal matters, documents or proceedings referred to
therein, fairly present the information required to be
described with respect to such legal matters, documents and
proceedings and summarize in all material respects the matters
referred to therein;
(ix) to such counsel's knowledge, there are no (i)
legal or governmental proceedings pending or threatened to
which the Obligors or any of their subsidiaries is a party or
to which any of the properties of the Obligors or any of their
subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not so
described or (ii) contracts, indentures, mortgages, loan
agreements, notes, leases or other documents that are required
to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required;
(x) to such counsel's knowledge, there are no
statutes or regulations (other than federal, state or local
telecommunications statutes or regulations as to which such
counsel need express no opinion) that are required to be
described in the Registration Statement or the Prospectus that
are not described as required; and
(xi) neither of the Obligors is and, after giving
effect to the offering and sale of the Notes and the
application of the proceeds thereof as described in the
Prospectus, neither will be an "investment company" as such
term is defined in the Investment Company Act of 1940, as
amended.
(d) The Underwriters shall have received on the Closing Date a
statement of Xxxxxxx, Xxxxxx & Xxxxx, outside counsel for the Obligors,
dated the Closing Date, to the effect that:
Although such counsel has made certain inquiries and
investigations in connection with the preparation of the
Registration Statement and the Prospectus, the limitations
inherent in the role of outside counsel are such that such
counsel cannot and does not assume responsibility for the
accuracy or completeness of the statements made in the
Registration Statement and Prospectus, except in so far as
such statements relate to such counsel and except to the
extent set forth in paragraph (viii) of such counsel's opinion
to you dated the Closing Date. Subject to the foregoing, such
counsel hereby advises you
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that such counsel's work in connection with this matter did
not disclose any information that gave such counsel reason to
believe that: (i) the Registration Statement at the time the
Registration Statement became effective, or the Prospectus as
of the date hereof (in each case except for the financial
statements and other information of a statistical, accounting
or financial nature included therein, and the Statement of
Eligibility (Form T-1) included as an exhibit to the
Registration Statement, as to which such counsel does not
express any view) was not appropriately responsive in all
material respects to the requirements of the Securities Act
and the Trust Indenture Act of 1939 and the applicable rules
and regulations of the Commission thereunder, or (ii) the
Registration Statement at the time the Registration Statement
became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading or that the Prospectus, as of its date and as of
the date hereof, included or includes 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 under which they were made, not misleading (in
each case except for the financial statements and other
information of a statistical, accounting or financial nature
included therein, and the Statement of Eligibility (Form T-1)
included as an exhibit to the Registration Statement, as to
which such counsel does not express any view).
(e) The Underwriters shall have received on the Closing Date
an opinion of Xxxx X. Xxxxx, Esq., General Counsel to Time Warner and
to the Company, dated the Closing Date, to the effect that:
(i) Time Warner has been duly formed and is validly
existing as a limited liability company in good standing under
the laws of Delaware, with full limited liability company
power and authority to own its property and to conduct it
business as described in the Prospectus;
(ii) the Company has been duly incorporated and is
validly existing and in good standing under the laws of the
State of Delaware, with full corporate power and authority to
own its property and to conduct its business as described in
the Prospectus;
(iii) each of Time Warner and the Company is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be
in good
14
standing would not have a material adverse effect on Time
Warner and its subsidiaries, taken as a whole;
(iv) each subsidiary of Time Warner has been duly
incorporated or, in the case of partnerships or limited
liability companies, duly organized, is validly existing as a
corporation, a partnership or a limited liability company, as
the case may be, in good standing under the laws of the
jurisdiction of its incorporation or organization, as the case
may be, has the power and authority to own its property and to
conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be
in good standing would not have a material adverse effect on
Time Warner and its subsidiaries, taken as a whole;
(v) all of the issued shares of capital stock of each
subsidiary of Time Warner that is a corporation have been duly
and validly authorized and issued, are fully paid and
non-assessable and are owned directly by Time Warner free and
clear of all liens, encumbrances, equities or claims; and all
of the partnership interests and membership interests in each
subsidiary of Time Warner that is a partnership or limited
liability company, as the case may be, are owned directly by
Time Warner free and clear of all liens, encumbrances,
equities or claims;
(vi) The statements contained in the Registration
Statement under the captions "Risk Factors -- Risks Relating
to Long Distance," "Risk Factors -- Dependence Upon
Interconnection with ILECs; Competition," "Risk Factors --
Federal and State Regulation," "Risk Factors -- Relationship
with TW Cable," "Certain Relationships and Related
Transactions -- Certain Operating Agreements," "Business --
Competition," "Business -- State Regulation" and "Business --
Local Government Authorizations," insofar as such statements
constitute a summary of the legal or regulatory matters or
legal or regulatory proceedings referred to therein, are
correct in all material respects and do not omit a material
fact necessary to make the statements contained therein not
misleading;
(vii) to such counsel's knowledge, the Obligors
possess the Governmental Licenses and the Obligors are in
compliance with the terms and conditions of all such
Governmental Licenses, except where the failure to so comply
would not, singly or in the aggregate, have a material adverse
effect on Time Warner and its subsidiaries, taken as a whole,
and all of the Governmental
15
Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of
such Governmental Licenses to be in full force and effect
would not have a material adverse effect on Time Warner and
its subsidiaries, taken as a whole;
(viii) there is no outstanding adverse judgment,
decree or order that has been issued by the FCC or any of the
Local Authorities against the Obligors and their subsidiaries
which, singly or in the aggregate, would have a material
adverse effect on Time Warner and its subsidiaries, taken as a
whole, and, to the best of such counsel's knowledge, neither
the Obligors nor any of their subsidiaries is the object of,
or threatened by, any proceedings relating to the revocation
or modification of any such Governmental Licenses or, except
as set forth in the Prospectus, that would otherwise affect
the operation of the Obligors, which, singly or in the
aggregate, would have a material adverse effect on Time Warner
and its subsidiaries, taken as a whole;
(ix) the Obligors have obtained all
telecommunications, regulatory or public utility
authorizations and consents from New York, Tennessee, North
Carolina and Hawaii required for the issuance of the Notes,
and no further filings with, authorizations, approval,
consent, license, order, registrations, qualification or
decree is necessary or required from any other Local
Authorities having jurisdiction over telecommunications
matters for the Company in connection with the due
authorization, execution and delivery of this Agreement or for
the offering, issuance, sale or delivery of the Notes, except
for notice filings where the failure to make such filings
would not materially adversely affect the performance by the
Obligors of their obligations under this Agreement;
(x) the execution, delivery and performance of this
Agreement and the consummation of the transactions
contemplated in this Agreement, the issuance and sale of the
Notes, and the use of the proceeds from the sale of the Notes
to the extent expressly described in the Prospectus under the
caption "Use of Proceeds" and compliance by the Obligors with
their respective obligations under this Agreement do not and
will not, whether with or without the giving of notice or
lapse of time or both, result in any violation of any
applicable law, statute, rule, regulation, judgment, order,
writ or decree, known to such counsel of any Local Authority
having jurisdiction over Time Warner or any of its
subsidiaries or any of their respective assets or operations
with respect to the provision of telecommunications services
except for such violations that would not have a material
adverse effect on Time Warner and its subsidiaries, taken as a
whole; and
16
(xi) to such counsel's knowledge, there are no
telecommunications statutes or regulations that are required
to be described in the Registration Statement or the
Prospectus that are not described as required.
In rendering opinion (vii) above, the General Counsel may
rely, as to matters involving the application of the laws of
California, Florida, Hawaii, Indiana, New York, North Carolina, Texas
and Wisconsin, upon the opinions of special counsel to the Obligors
(which opinions shall be dated and furnished to the Underwriters on the
Closing Date and shall be satisfactory in form and substance to counsel
for the Underwriters, provided that the General Counsel shall state in
his opinion that he believes that he is justified in relying upon such
opinions).
(f) The Underwriters shall have received on the Closing Date
an opinion of Xxxxxxxxxx and Xxxxx, regulatory counsel for the Company,
dated the Closing Date, to the effect that:
(i) The statements contained in the Registration
Statement under the captions "Risk Factors -- Governmental and
Other Authorizations," "Business -- Government Regulation" and
"Business -- Federal Regulation," insofar as such statements
constitute a summary of the legal or regulatory matters or
legal or regulatory proceedings referred to therein, are
correct in all material respects and do not omit a material
fact necessary to make the statements contained therein not
misleading; and
(ii) The execution and delivery of the Amended and
Restated Limited Liability Company Agreement dated as of July
14, 1998 (the "LLC Agreement"), by and among TWE, TWE-A/N,
TWC, MediaOne, Xxxxxxxx, American Television and
Communications Corporation, Warner Communications, Inc.,
TW/TAE Inc., FibrCOM Holdings L.P. and Paragon Communications,
and compliance by Time Warner with the terms of the LLC
Agreement does not and will not violate the Federal
Communications Act of 1934, as amended, or the rules and
regulations of the FCC.
(g) The Underwriters shall have received on the Closing Date
an opinion of Xxxxx, Xxxxxxx & Xxxxx LLP, outside counsel for
Advance/Xxxxxxxx Partnership, dated as of the Closing Date, to the
effect that the Reorganization Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of,
Advance/Xxxxxxxx Partnership, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, insolvency or similar laws
affecting creditors' rights generally and general principles of equity.
17
(h) The Underwriters shall have received on the Closing Date
an opinion of Xxxx, Gotshal & Xxxxxx LLP, outside counsel for MediaOne,
dated as of the Closing Date, to the effect that the Reorganization
Agreement has been duly authorized, executed and delivered by, and is a
valid and binding agreement of, MediaOne Group, Inc., enforceable
against it in accordance with its terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and general principles of equity.
(i) The Underwriters shall have received on the Closing Date
an opinion of Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters, dated
the Closing Date, covering the matters referred to in Sections 5(c)(v),
5(c)(vii), 5(c)(viii) (but only as to the statements in the Prospectus
under "Description of the Notes" and "Underwriters") and 5(d) above.
With respect to Section 5(d) above, Xxxxxxx, Xxxxxx & Xxxxx
and Xxxxxxxx & Xxxxxxxx may provide their statements in separate
letters and may state that their opinion and belief are based upon
their participation in the preparation of the Registration Statement
and Prospectus and any amendments or supplements thereto and review and
discussion of the contents thereof, but are without independent check
or verification, except as specified.
The opinion of Xxxxxxx, Swaine & Xxxxx described in Section
5(c) above shall be rendered to the Underwriters at the request of the
Obligors and shall so state therein.
(j) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated the date hereof or the
Closing Date, as the case may be, in form and substance satisfactory to
the Underwriters, from Ernst & Xxxxx, LLP, independent public
accountants, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus;
provided that the letter delivered on the Closing Date shall use a
"cut-off date" not earlier than the date hereof.
(k) The Reorganization (as defined in the Prospectus) shall
have been consummated.
6. Covenants of the Obligors. In further consideration of the
agreements of the Underwriters herein contained, the Obligors covenant with each
Underwriter as follows:
(a) To furnish to you, without charge, five signed copies of
the Registration Statement (including exhibits thereto) and for
delivery to each other Underwriter a
18
conformed copy of the Registration Statement (without exhibits thereto)
and to furnish to you in New York City, without charge, prior to 10:00
a.m. New York City time on the business day next succeeding the date of
this Agreement and during the period mentioned in Section 6(c) below,
as many copies of the Prospectus and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you reasonably object, and to file
with the Commission within the applicable period specified in Rule
424(b) under the Securities Act any prospectus required to be filed
pursuant to such Rule.
(c) If, during such period after the first date of the public
offering of the Notes as in the opinion of counsel for the Underwriters
the Prospectus is required by law to be delivered in connection with
sales by an Underwriter or dealer, any event shall occur or condition
exist as a result of which it is necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if it is necessary to amend or supplement the Prospectus
to comply with applicable law, forthwith to prepare, file with the
Commission and furnish, at its own expense, to the Underwriters and to
the dealers (whose names and addresses you will furnish to the
Obligors) to which Notes may have been sold by you on behalf of the
Underwriters and to any other dealers upon request, either amendments
or supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(d) To endeavor to qualify the Notes for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request; provided that, in connection therewith, neither
Obligor shall be required to qualify as a foreign corporation or
foreign limited liability company, as the case may be, or to file a
general consent to service of process in any jurisdiction.
(e) To make generally available to Time Warner's security
holders and to the Company's security holders and to you as soon as
practicable an earning statement covering the twelve-month period
ending September 30, 1999 that satisfies the provisions of Section
11(a) of the Securities Act and the rules and regulations of the
Commission thereunder.
19
(f) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including: (i) the fees,
disbursements and expenses of the Obligors' counsel and the Obligors'
accountants in connection with the registration and delivery of the
Notes under the Securities Act and all other fees or expenses in
connection with the preparation and filing of the Registration
Statement, any preliminary prospectus, the Prospectus and amendments
and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof
to the Underwriters and dealers, in the quantities hereinabove
specified, (ii) all costs and expenses related to the transfer and
delivery of the Notes to the Underwriters, including any transfer or
other taxes payable thereon, (iii) the cost of printing or producing
any Blue Sky or Legal Investment memorandum in connection with the
offer and sale of the Notes under state securities laws and all
expenses in connection with the qualification of the Notes for offer
and sale under state securities laws as provided in Section 6(d)
hereof, including filing fees and the reasonable fees and disbursements
of counsel for the Underwriters in connection with such qualification
and in connection with the Blue Sky or Legal Investment memorandum,
(iv) all filing fees and the reasonable fees and disbursements of
counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Notes by the National Association
of Securities Dealers, Inc., (v) the cost of preparation, issuance and
delivery of the Notes, (vi) the costs and charges of the Trustee, (vii)
the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the
marketing of the offering of the Notes, including, without limitation,
expenses associated with the production of road show slides and
graphics, fees and expenses of any consultants engaged in connection
with the road show presentations with the prior approval of the
Obligors, travel and lodging expenses of the representatives and
officers of the Obligors and any such consultants, and the cost of any
aircraft chartered in connection with the road show; provided, that the
Underwriters will reimburse the Obligors for the Underwriters' pro rata
share of the cost of such chartered aircraft, (viii) all expenses in
connection with any offer and sale of the Notes outside of the United
States, including all filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with offers
and sales outside of the United States and (ix) all other costs and
expenses incident to the performance of the obligations of the Company
hereunder for which provision is not otherwise made in this Section. It
is understood, however, that except as provided in this Section,
Section 7 entitled "Indemnity and Contribution," and the last paragraph
of Section 9 below, the Underwriters will pay all of their costs and
expenses, including fees and disbursements of their counsel, transfer
taxes payable on resale of any of the Notes by them and any advertising
expenses connected with any offers they may make.
20
7. Indemnity and Contribution. (a) Time Warner and the
Company, jointly and severally, agree to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), from and
against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus or
the Prospectus (as amended or supplemented if the Obligors shall have furnished
any amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Obligors in writing by such
Underwriter through you expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless each of Time Warner, the Company, their directors
and officers who sign the Registration Statement and each person, if any, who
controls Time Warner or the Company within the meaning of either Section 15 of
the Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from Time Warner and the Company to such Underwriter, but
only with reference to information relating to such Underwriter furnished to the
Obligors in writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to Section 7(a) or 7(b), such person (the
"INDEMNIFIED PARTY") shall promptly notify the person against whom such
indemnity may be sought (the "INDEMNIFYING PARTY") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
21
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of
parties indemnified pursuant to Section 7(a), and by the Obligors, in the case
of parties indemnified pursuant to Section 7(b). The indemnifying party shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) To the extent the indemnification provided for in Section
7(a) or 7(b) is unavailable to an indemnified party or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Obligors on the one hand and the Underwriters on the
other hand from the offering of the Notes or (ii) if the allocation provided by
clause 7(d)(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
7(d)(i) above but also the relative fault of the Obligors on the one hand and of
the Underwriters on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Obligors on the one hand and the Underwriters on the other hand in
connection with the offering of the Notes shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Notes
(before deducting expenses) received by the Obligors and the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover of the Prospectus, bear to the Public Offering
Price of the Notes. The relative fault of the Obligors on the one hand and the
22
Underwriters on the other hand 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 Obligors or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective principal amounts of Notes they have purchased hereunder, and not
joint.
(e) The Obligors and the Underwriters agree that it would not
be just or equitable if contribution pursuant to this Section 7 were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 7(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Notes
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 7 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in
this Section 7 and the representations, warranties and other statements of the
Obligors contained in this Agreement shall remain operative and in full force
and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter or by or on behalf of the Obligors, its respective officers or
directors or any person controlling the Obligors and (iii) acceptance of and
payment for any of the Notes.
8. Termination. This Agreement shall be subject to termination
by notice given by you to each of the Obligors, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally
shall have been suspended or materially limited on or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii)
23
trading of any securities of the Obligors shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in your judgment, is material and adverse and (b) in
the case of any of the events specified in clauses 8(a)(i) through 8(a)(iv),
such event, singly or together with any other such event, makes it, in your
judgment, impracticable to market the Notes on the terms and in the manner
contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement
shall become effective upon the execution and delivery hereof by the parties
hereto.
If, on the Closing Date, any one or more of the Underwriters
shall fail or refuse to purchase Notes that it has or they have agreed to
purchase hereunder on such date, and the aggregate principal amount of Notes
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase is not more than one-tenth of the aggregate principal amount of
Notes to be purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the principal amount of Notes set forth
opposite their respective names in Schedule I bears to the aggregate principal
amount of Notes set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
Notes which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the principal
amount of Notes that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 9 by an amount in excess of
one-ninth of such principal amount of Notes without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail
or refuse to purchase Notes and the aggregate principal amount of Notes with
respect to which such default occurs is more than one-tenth of the aggregate
principal amount of Notes to be purchased, and arrangements satisfactory to you
and the Company for the purchase of such Notes are not made within 36 hours
after such default, this Agreement shall terminate without liability on the part
of any non-defaulting Underwriter or the Company. In any such case either you or
the Company shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement, the Company will reimburse the
24
Underwriters or such Underwriters as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket expenses (including the
fees and disbursements of their counsel) reasonably incurred by such
Underwriters in connection with this Agreement or the offering contemplated
hereunder.
10. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
12. Headings. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
Very truly yours,
TIME WARNER TELECOM LLC
By: /s/ Xxxxx X. Xxxxxx
-----------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
TIME WARNER TELECOM INC.
By: /s/ Xxxxx X. Xxxxxx
-----------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXX BROTHERS INC.
Acting severally on behalf of themselves
and the several Underwriters
named in Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: ___________________________
Name:
Title:
12. Headings. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
Very truly yours,
TIME WARNER TELECOM LLC
By:
-----------------------
Name:
Title:
TIME WARNER TELECOM INC.
By:
-----------------------
Name:
Title:
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXX BROTHERS INC.
Acting severally on behalf of themselves
and the several Underwriters
named in Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
SCHEDULE 1
UNDERWRITERS
AGGREGATE
PRINCIPAL AMOUNT
OF NOTES
UNDERWRITER TO BE PURCHASED
----------- ---------------
Xxxxxx Xxxxxxx & Co. Incorporated................ $200,000,000
Xxxxxx Brothers Inc.............................. $200,000,000
------------
Total Notes............................. $400,000,000
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