Charter Communications, Inc.
4.75% Convertible Senior Notes due 2006
Underwriting Agreement
May 23, 2001
Xxxxxx Xxxxxxx & Co. Incorporated,
Xxxxxxx, Xxxxx & Co.,
Banc of America Securities LLC,
Bear, Xxxxxxx & Co. Inc.,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated,
Xxxxxxx Xxxxx Xxxxxx Inc.,
X.X. Xxxxxx Securities Inc.,
Credit Lyonnais Securities (USA) Inc.,
Fleet Securities, Inc.,
BMO Xxxxxxx Xxxxx,
Dresdner Kleinwort Xxxxxxxxxxx Securities LLC,
As representatives of the several Underwriters
named in Schedule I hereto (the "Representatives"),
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Charter Communications, Inc., a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of $550,000,000 principal amount of 4.75%
Convertible Senior Notes due 2006 (the "Firm Securities") of the Company
convertible into Class A Common Stock, par value $.001 per share (the "Common
Stock"), of the Company and, at the election of the Underwriters, up to an
additional $82,500,000 aggregate principal amount of such notes (the "Optional
Securities") (the Firm Securities and the Optional Securities that the
Underwriters elect to purchase pursuant to Section 2 hereof being collectively
called the "Securities").
It is understood and agreed that Xxxxxx Xxxxxxx & Co. Incorporated
and Xxxxxxx, Xxxxx & Co. are joint book-runners and joint lead managers for the
offering of the Securities and any determinations or other actions to be made
under this Agreement by you or the Representatives shall require the concurrence
of both Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx & Co.
1. The Company and Charter Communications Holding Company, LLC, a
Delaware limited liability company ("Holding"), jointly and severally, represent
and warrant to, and agree with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-56850) and
pre-effective amendment no. 1 thereto (together, the "Initial
Registration Statement") in respect of the Securities and shares of
Common Stock issuable upon conversion thereof and the offering thereof
from time to time in accordance with Rule 415 of the rules and
regulations of the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the
"Act"), has been filed with the Commission; the Initial Registration
Statement and any post-effective amendment thereto filed with the
Commission on or before the date of this Agreement, each in the form
heretofore delivered to you, and, excluding exhibits thereto but
including all documents incorporated by reference in the prospectus
contained therein, delivered to you for each of the other
Underwriters, have been declared effective by the Commission in such
form; no other document with respect to the Initial Registration
Statement or documents incorporated by reference therein has
heretofore been filed with the Commission (other than prospectuses
filed pursuant to Rule 424(b) of the rules and regulations of the
Commission under the Act, each in the form heretofore delivered to
you); and no stop order suspending the effectiveness of the Initial
Registration Statement or any post-effective amendment thereto has
been issued and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included in
the Initial Registration Statement, filed with the Commission pursuant
to Rule 424(a) of the rules and regulations of the Commission under
the Act or that omitted information to be included upon pricing in a
form of prospectus filed with the Commission pursuant to Rule 424(b)
of the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various parts of
the Initial Registration Statement, including all exhibits thereto but
excluding Form T-1 and including the documents incorporated by
reference in the prospectus contained in the Initial Registration
Statement at the time such part of the Initial Registration Statement
became effective, each as amended at the time such part of the Initial
Registration Statement became effective and as amended by any
post-effective amendment thereto at the time such post-effective
amendment became effective, are hereinafter supplement and the final
prospectus collectively called the "Registration Statement"; the final
prospectus supplement and the final
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prospectus relating to the Securities and shares of Common Stock
issuable upon conversion thereof, in the form first filed with the
Commission pursuant to Rule 424(b) under the Act, are hereinafter
collectively called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference
in such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed
to refer to the Prospectus as amended or supplemented relating to the
Securities and shares of Common Stock issuable upon conversion thereof
in the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof, including
any documents incorporated by reference therein as of the date of such
filing).
(b) No order preventing or suspending the use of any Preliminary
Prospectus or Prospectus has been issued by the Commission, and each
Preliminary Prospectus and Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the Act and
the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the rules and regulations of the Commission thereunder and
did not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through Xxxxxx
Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx & Co. expressly for use
therein;
(c) The documents incorporated by reference in any Preliminary
Prospectus and the Prospectus, when they became effective or were
filed with the Commission, as the case may be, conformed in all
material respects to the requirements of the Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission
thereunder, and, when such documents became effective or were filed
with the Commission, as the case may be, none of such
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documents contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and any further documents
so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(d) As of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable filing
date as to the Prospectus and any amendment or supplement thereto, the
Registration Statement and the Prospectus conform, and any further
amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the Trust Indenture Act and the rules and regulations
of the Commission thereunder and do not and will not, as of the
applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through Xxxxxx Xxxxxxx & Co. Incorporated and
Xxxxxxx, Xxxxx & Co. expressly for use therein;
(e) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock,
limited liability company interests or long-term debt of the Company
or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
members' or stockholders' equity, or results of operations of the
Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus;
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(f) Each of the Company and its subsidiaries has good and
marketable title in fee simple to all real property and good and valid
title to all personal property owned by it reflected as owned in the
financial statements or elsewhere in the Prospectus, in each case free
and clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its
subsidiaries;
(g) The Company has been duly formed and is validly existing as a
corporation in good standing under the laws of the State of Delaware;
Holding has been duly formed and is validly existing as a limited
liability company in good standing under the laws of the State of
Delaware; each of the Company and Holding has power and authority
(corporate and other) to own its properties and conduct its business
as described in the Prospectus and to execute, deliver and perform its
obligations under this Agreement, and has been duly qualified as a
foreign corporation or limited liability company, as the case may be,
for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification, and is not
subject to liability or disability by reason of the failure to be so
qualified in any such jurisdiction, except such as would not,
individually and in the aggregate, have a material adverse effect on
the current or future financial position, stockholders' or members'
equity or results of operations of the Company and its subsidiaries
taken as a whole (a "Material Adverse Effect"); each "significant
subsidiary" (as such term is defined in Rule 1-02 of Regulation S-X)
of the Company (each, a "Significant Subsidiary") has been duly
incorporated or formed, as the case may be, and is validly existing as
a corporation or limited liability company, as the case may be, in
good standing under the laws of its jurisdiction of incorporation or
formation;
(h) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable, and conform to the descriptions thereof
contained in the Prospectus; the Securities are convertible into
shares of Common Stock in accordance with the terms of the Indenture
(as hereinafter defined); the shares of Common Stock initially
issuable upon conversion of the Securities have been duly and validly
authorized and reserved for issuance and, when issued and delivered in
accordance with the provisions of the Securities and the Indenture
will be duly and validly issued,
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fully paid and non-assessable, and will conform to the description of
the Common Stock contained in the Prospectus; the Company's
stockholders have no preemptive rights with respect to the Common
Stock; Holding has an authorized capitalization as set forth in the
Prospectus, and all of the issued and outstanding Membership Units
have been duly and validly authorized and issued, are fully paid and
non-assessable, are owned directly by the Company, Charter Investment,
Inc., Vulcan Cable III Inc. and by those other persons and entities as
described in the Prospectus, and, in the case of the Company, are
owned free and clear of all liens, encumbrances, equities or claims,
and conform to the description thereof contained in the Prospectus;
and all of the outstanding capital stock or limited liability company
interests, as the case may be, of each Significant Subsidiary of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and (except as otherwise set forth in the
Prospectus) are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(i) The Securities have been duly authorized and, when executed by
the Company and authenticated by the Trustee (as hereinafter defined)
in accordance with the provisions of the Indenture and when delivered
to, and paid for, by the Underwriters in accordance with the terms of
this Agreement, will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding
obligations of the Company entitled to the benefits provided by the
indenture to be dated as of May 30, 2001 (the "Indenture"), between
the Company and BNY Midwest Trust Company, as Trustee (the "Trustee"),
under which they are to be issued and enforceable against the Company
in accordance with their terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(j) The Indenture has been duly authorized and, when executed and
delivered by the Company (and assuming the due execution and delivery
thereof by the Trustee), the Indenture will constitute a valid and
legally binding instrument, enforceable against the Company in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; the Indenture has been duly qualified under the Trust
Indenture Act; and the Indenture will conform in all material respects
to the description thereof in the Prospectus under the caption
"Description of Notes";
(k) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale
of the Securities) will violate or result in a violation of Section 7
of the Exchange Act or any regulation
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promulgated thereunder, including, without limitation, Regulations T,
U, and X of the Board of Governors of the Federal Reserve System;
(l) Prior to the date hereof, none of the Company, any of its
subsidiaries or, to the best of the Company's knowledge, any of its
other affiliates has taken any action which is designed to or which
has constituted or which might have been expected to cause or result
in stabilization or manipulation of the price of any security of the
Company or any of its subsidiaries in connection with the offering of
the Securities;
(m) The issue and sale of the Securities hereunder and the
compliance by the Company and Holding, as the case may be, with all of
the provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein contemplated,
including the conversion of the Securities into shares of Common
Stock, will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement, lease, license,
franchise agreement, permit or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of any statute
or any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company, any of its subsidiaries
or any of their respective properties, including, without limitation,
the Communications Act of 1934, as amended, the Cable Communications
Policy Act of 1984, as amended, the Cable Television Consumer
Protection and Competition Act of 1992, as amended, and the
Telecommunications Act of 1996 (collectively, the "Cable Acts") or any
order, rule or regulation of the Federal Communications Commission
(the "FCC"), except where such conflict, breach, violation or default
would not, individually and in the aggregate, have a Material Adverse
Effect and would not have the effect of preventing the Company or
Holding from performing any of their respective obligations under this
Agreement; nor will such action result in any violation of the
restated certificate of incorporation or bylaws of the Company or the
certificate of formation or amended and restated limited liability
company agreement of Holding; and no consent, approval, authorization,
order, registration or qualification of or with any such court or
governmental agency or body is required, including, without
limitation, under the Cable Acts or any order, rule or regulation of
the FCC, for the issue and sale of the Securities, the issue and
delivery of shares of Common Stock issuable upon conversion of the
Securities or the consummation by the Company or Holding, as the case
may be, of the transactions contemplated by this Agreement or the
Indenture, except such consents, approvals, authorizations,
registrations or qualifications as have been made or except as may be
required under state or foreign securities or Blue Sky
7
laws in connection with the purchase and distribution of the
Securities by the Underwriters and except such as may be required by
the National Association of Securities Dealers, Inc. ("NASD");
(n) Neither the Company nor any of its subsidiaries is (i) in
violation of its certificate of incorporation, bylaws, certificate of
formation, limited liability company agreement or other organizational
document, as the case may be, (ii) in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement,
lease, license, permit or other agreement or instrument to which it is
a party or by which it or any of its properties may be bound or (iii)
in violation of the terms of any franchise agreement, or any law,
statute, rule or regulation or any judgment, decree or order, in any
such case, of any court or governmental or regulatory agency or other
body having jurisdiction over the Company or any of its subsidiaries
or any of their properties or assets, including, without limitation,
the Cable Acts or any order, rule or regulation of the FCC, except, in
the case of clauses (ii) and (iii), such as would not, individually
and in the aggregate, have a Material Adverse Effect;
(o) The provisions of the Company's restated certificate of
incorporation and bylaws, including, without limitation, the
provisions thereof relating to the Common Stock and the Company's
Class B Common Stock, par value .001 per share (the "Class B Stock")
(A) are lawful and permitted under the Delaware General Corporation
Law, do not violate any Delaware statute or rule or regulation of any
Delaware governmental agency or body having jurisdiction over the
Company or Holding and, subject to principles of equity, a Delaware
court properly presented with the matter would so find and (B) do not
violate any order of any Delaware court having jurisdiction over the
Company or Holding. Holding's certificate of formation and amended and
restated limited liability company agreement do not violate the
Delaware Limited Liability Company Act, Holding's amended and restated
limited liability company agreement is enforceable against the parties
thereto in accordance with its terms, and Holding's certificate of
formation and amended and restated limited liability company agreement
do not violate (i) any Delaware statute, (ii) any rule or regulation
of any Delaware governmental agency or body having jurisdiction over
the Company or Holding or (iii) any order of any Delaware court having
jurisdiction over the Company or Holding;
(p) The statements set forth in the Prospectus under the captions
"Description of Notes" and "Description of Capital Stock and
Membership Units," insofar as they purport to constitute a summary of
the terms of the Securities and the Common Stock, and under the
captions "Risk Factors--Regulatory and Legislative Matters,"
"Business--Pending AT&T Transactions,"
8
"Regulation and Legislation," "Management," "Certain Relationships and
Related Transactions," "Description of Certain Indebtedness," "Certain
United States Tax Considerations for Non-United States Holders of
Class A Common Stock" and "Summary of Certain United States Federal
Tax Considerations for Holders of Notes," insofar as they purport to
describe the provisions of the laws, documents and arrangements
referred to therein, are accurate in all material respects;
(q) Other than as set forth in the Prospectus, there are no legal
or governmental proceedings (including, without limitation, by the FCC
or any franchising authority) pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which, if determined adversely
to the Company or any of its subsidiaries, would, individually or in
the aggregate, have a Material Adverse Effect; and, to the best
knowledge of the Company and Holding and except as disclosed in the
Prospectus, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(r) Each of the Company and its subsidiaries carries insurance
(including self-insurance) in such amounts and covering such risks as
in the reasonable determination of the Company and Holding is adequate
for the conduct of its business and the value of its respective
properties;
(s) Except as set forth in the Prospectus, there is no strike,
labor dispute, slowdown or work stoppage with the employees of any of
the Company or its subsidiaries which is pending or, to the best
knowledge of the Company and Holding, threatened which would,
individually or in the aggregate, have a Material Adverse Effect;
(t) Neither the Company nor Holding is and, after giving effect to
the offering and sale of the Securities, neither of them will be an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "Investment Company Act");
(u) The audited consolidated financial statements (including the
notes thereto) included or incorporated by reference in the Prospectus
present fairly in all material respects the respective consolidated
financial positions, results of operations and cash flows of the
entities to which they relate at the dates and for the periods to
which they relate and have been prepared in accordance with U.S.
generally accepted accounting principles ("GAAP") applied on a
consistent basis; the supporting schedules included or incorporated by
reference in the Registration Statement present fairly in accordance
with GAAP the information required to be stated therein; and the
summary and selected financial data in the Prospectus
9
present fairly in all material respects the information shown therein
and have been prepared and compiled on a basis consistent with the
audited financial statements included therein;
(v) The pro forma financial statements (including the notes
thereto) and the other pro forma financial information included or
incorporated by reference in the Prospectus (i) comply as to form in
all material respects with the applicable requirements of Regulation
S-X for Form S-3 promulgated under the Exchange Act, and (ii) have
been properly computed on the bases described therein; the assumptions
used in the preparation of the pro forma financial data and other pro
forma financial information included or incorporated by reference in
the Prospectus are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances
referred to therein;
(w) Each of the firms who have certified financial statements
included or incorporated by reference in the Prospectus are
independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder, based upon
representations by such firms to the Company;
(x) The Company and its subsidiaries own or possess, or can
acquire on reasonable terms, adequate licenses, trademarks, service
marks, trade names and copyrights (collectively, "Intellectual
Property") necessary to conduct the business now or proposed to be
operated by each of them as described in the Prospectus, except where
the failure to own, possess or have the ability to acquire any
Intellectual Property would not, individually and in the aggregate,
have a Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of infringement of or conflict
with (and none actually knows of any such infringement of or conflict
with) asserted rights of others with respect to any Intellectual
Property which, if any such assertion of infringement or conflict were
sustained would, individually or in the aggregate, have a Material
Adverse Effect;
(y) Except as described in the Prospectus, the Company and its
subsidiaries have obtained all consents, approvals, orders,
certificates, licenses, permits, franchises and other authorizations
of and from, and have made all declarations and filings with, all
governmental and regulatory authorities (including, without
limitation, the FCC), all self-regulatory organizations and all courts
and other tribunals legally necessary to own, lease, license and use
their respective properties and assets and to conduct their respective
businesses in the manner described in the Prospectus, except to the
extent that the failure to so obtain or file would not, individually
and in the aggregate, have a Material Adverse Effect;
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(z) Except as described in the Prospectus, there are no contracts,
agreements or understandings between the Company, Holding or any of
their affiliates and any person granting such person the right to
require the Company or Holding to file a registration statement under
the Act with respect to any securities of the Company or Holding; and
except as described in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, and no
commitments, plans or arrangements to issue, any securities of the
Company or Holding or any security convertible into or exchangeable
for securities of the Company or Holding;
(aa) The Company and its subsidiaries have filed all necessary
federal, state and foreign income and franchise tax returns required
to be filed as of the date hereof, except where the failure to so file
such returns would not, individually and in the aggregate, have a
Material Adverse Effect, and have paid all taxes shown as due thereon;
and there is no tax deficiency that has been asserted against the
Company or any of its subsidiaries that could reasonably be expected
to result, individually or in the aggregate, in a Material Adverse
Effect;
(bb) The Company and its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(cc) Each of the franchises held by the Company and its
subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, is in full force and effect, with no material
restrictions or qualifications other than those with which the Company
and/or its subsidiaries are in compliance in all material respects;
and to the best knowledge of the Company, no event has occurred which
permits, or with notice or lapse of time or both would permit, the
revocation or non-renewal of any such franchise, assuming the filing
of timely renewal applications and the timely payment of all
applicable filing and regulatory fees to the applicable franchising
authority, or which might result, individually or in the aggregate, in
any other material impairment of the rights of the Company and its
subsidiaries in such franchises. Except as described in the
Prospectus, the Company has no reason to believe that any such
franchise will not be renewed in the ordinary course; and
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(dd) The Company and its subsidiaries (i) are in compliance with
any and all applicable foreign, federal, state and - local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions of
such permits, licenses or approvals would not, individually and in the
aggregate, have a Material Adverse Effect.
(ee) There are no contracts, other documents or other agreements
required to be described in the Registration Statement or to be filed
as exhibits to the Registration Statement by the Act or by the rules
and regulations thereunder which have not been described or filed or
incorporated by reference therein as required; the contracts so
described in the Prospectus are in full force and effect on the date
hereof; and neither the Company nor any of its subsidiaries and, to
the best of the Company's knowledge, any other party is in breach of
or default under any of such contracts, except for those breaches or
defaults that would not, individually and in the aggregate, result in
a Material Adverse Effect.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price of 97.25% of the principal amount thereof, the principal amount
of Firm Securities set forth opposite the name of such Underwriter in Schedule I
hereto and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Securities as provided below, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
the same purchase price set forth in clause (a) of this Section 2, that portion
of the aggregate principal amount of the Optional Securities as to which such
election shall have been exercised determined by multiplying such aggregate
principal amount of Optional Securities by a fraction, the numerator of which is
the maximum aggregate principal amount of Optional Securities which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
aggregate principal amount of Optional Securities that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to
purchase at their election up to $82,500,000 aggregate principal amount of
Optional Securities, at the purchase price set forth in clause (a) of the first
paragraph of this Section 2, for the sole purpose of covering sales of
securities in excess of the aggregate principal amount of the
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Firm Securities. Any such election to purchase Optional Securities may be
exercised only by written notice from both of Xxxxxx Xxxxxxx & Co. Incorporated
and Xxxxxxx, Xxxxx & Co. to the Company, given within a period of 30 calendar
days after the date of this Agreement, setting forth the aggregate principal
amount of Optional Securities to be purchased and the date on which such
Optional Securities are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice.
At each Time of Delivery, Holding shall pay to Xxxxxxx, Xxxxx &
Co., for the account of the Underwriters, as compensation for the Underwriters'
services in connection with the offering and sale of the Securities, an
underwriting commission equal to 3.0% of the aggregate principal amount of the
Securities being purchased at such Time of Delivery.
3. Upon the authorization by you of the release of the Firm
Securities, the several Underwriters propose to offer the Firm Securities for
sale upon the terms and conditions set forth in the Prospectus.
4. (a) The Securities to be purchased by each Underwriter
hereunder will be represented by one or more definitive global Securities in
book-entry form which will be deposited by or on behalf of the Company with The
Depository Trust Company ("DTC") or its designated custodian. The Company will
deliver the Securities to Xxxxxxx, Xxxxx & Co., for the account of each
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer of same day funds wired in accordance with the
written instructions of the Company, by causing DTC to credit the Securities to
the account of Xxxxxxx, Xxxxx & Co. at DTC. The Company will cause the
certificates representing the Securities to be made available to Xxxxxxx, Xxxxx
& Co. for checking at least twenty-four hours prior to the Time of Delivery (as
defined below) at the office of DTC or its designated custodian (the "Designated
Office"). The time and date of such delivery and payment shall be, with respect
to the Firm Securities, 9:30 a.m., New York City time, on May 30, 2001 or such
other time and date as Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx &
Co. and the Company may agree upon in writing, and, with respect to the Optional
Securities, 9:30 a.m., New York City time, on the date specified by Xxxxxx
Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx & Co. in the written notice given
by Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx & Co. of the
Underwriters' election to purchase such Optional Securities, or such other time
and date as Xxxxxxx, Xxxxx & Co. and the Company may agree upon in writing. Such
time and date for delivery of the Firm Securities is herein called the "First
Time of Delivery", such time and date for delivery of the Optional Securities,
if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a "Time of
Delivery."
13
(b) The documents to be delivered at each Time of Delivery by or
on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Securities and any additional documents requested by the
Underwriters pursuant to Section 7(j) hereof, will be delivered at such time and
date at the offices of Xxxx, Hastings, Xxxxxxxx & Xxxxxx LLP, 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 or such other location as the parties mutually agree
(the "Closing Location"), and the Securities will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at 2:00 p.m., New York City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day
following the execution and delivery of this Agreement; to make no
further amendment or any supplement to the Registration Statement or
Prospectus prior to the last Time of Delivery which shall be
disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish you with copies thereof; to
file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering
or sale of the Securities, to advise you, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Prospectus, of
the suspension of the qualification of the Securities or of the shares
of Common Stock issuable upon conversion of the Securities for
offering or sale in any jurisdiction, of the initiation or threatening
of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and, in the
event of the issuance of any stop order or of any order preventing or
suspending the use of any Prospectus or suspending any such
qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
14
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities and the shares of Common
Stock issuable upon conversion of the Securities for offering and sale
under the securities laws of such jurisdictions as you may request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the Securities, provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process
in any jurisdiction;
(c) On the New York Business Day next succeeding the date of this
Agreement or as soon as practicable thereafter and from time to time,
to furnish the Underwriters with written and electronic copies of the
Prospectus in New York City in such quantities as you may reasonably
request, and, if the delivery of a prospectus is required at any time
prior to the expiration of nine months after the time of issue of the
Prospectus in connection with the offering or sale of the Securities
and the shares of Common Stock issuable upon conversion of the
Securities and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement
the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with
the Act, the Exchange Act or the Trust Indenture Act, to notify you
and upon your request to file such document and to prepare and furnish
without charge to each Underwriter and to any dealer in securities as
many written and electronic copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect
such compliance; and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Securities and the
shares of Common Stock issuable upon conversion of the Securities at
any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter,
to prepare and deliver to such Underwriter as many written and
electronic copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
15
(e) During the period beginning from the date hereof and
continuing until the date 90 days after the date of this Agreement,
not to offer, sell, contract to sell or otherwise dispose of, except
as provided hereunder, any securities of the Company that are
substantially similar to the Securities or the Common Stock, including
but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Common Stock
or any such substantially similar securities (other than (i) pursuant
to employee option plans existing on the date of this Agreement (or
subsequently adopted by the Company's board of directors), (ii) upon
the conversion or exchange of convertible or exchangeable securities
outstanding as of the date of this Agreement or (iii) shares of Common
Stock issued by the Company as consideration for acquisitions of
businesses occurring after the date of this Agreement as long as the
recipients of such shares execute and deliver prior to the closing of
any such acquisition a lock-up agreement substantially to the effect
of the lock-up agreements being delivered pursuant to Section 7(k)
hereof), without the prior written consent of Xxxxxx Xxxxxxx & Co.
Incorporated and Xxxxxxx, Xxxxx & Co.; provided that this paragraph
(e) shall not restrict the Company's participation (other than as a
seller of securities) in connection with sales of securities under
registration statements that (x) are effective on the date of this
Agreement or (y) the Company is required to file pursuant to
registration rights agreements (other than with any person or entity
named on Schedule II hereto) outstanding on the date of this
Agreement;
(f) Not to be or become, at any time prior to the expiration of
two years after the Time of Delivery, an open-end investment company,
unit investment trust, closed-end investment company or face-amount
certificate company that is or is required to be registered under
Section 8 of the Investment Company Act;
(g) To furnish to the holders of the Securities as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders' or
members' equity and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as soon
as practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to
holders of the Securities consolidated summary financial information
of the Company and its subsidiaries for such quarter in reasonable
detail;
(h) During a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or
other communications (financial or other) furnished to holders of
Common Stock of the Company, and to deliver to you as soon as they are
available, copies of any reports and financial statements furnished to
or filed with the Commission or any
16
national securities exchange on which the Securities, the Common Stock
or any class of securities of the Company is listed;
(i) To use the net proceeds received from the sale of the
Securities pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(j) To reserve and keep available at all times, free of preemptive
rights, shares of Common Stock for the purpose of enabling the Company
to satisfy any obligation to issue shares of Common Stock upon
conversion of the Securities; and
(k) To use its best efforts to cause the shares of Common Stock
issuable upon conversion of the Securities to be approved for
quotation on the National Market Nasdaq ("Nasdaq").
6. Holding covenants and agrees with the several Underwriters that
Holding will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's and Holding's counsel and accountants in
connection with the registration of the Securities and the shares of Common
Stock issuable upon conversion of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the Indenture, the Blue Sky
Memorandum, closing documents (including compilations thereof) and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iii) all expenses in connection with the qualification of the
Securities and the shares of Common Stock issuable upon conversion of the
Securities for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky survey; (iv) any fees charged by securities rating services for rating
the Securities; (v) the filing fees incident to, and the fees and disbursements
of counsel for the Underwriters in connection with, any required review by the
NASD of the terms of the sale of the Securities; (vi) the cost of preparing the
Securities; (vii) the fees and expenses of the Trustee and any agent of the
Trustee and the fees and disbursements of counsel for the Trustee in connection
with the Indenture and the Securities; and (viii) all other costs and expenses
incident to the performance of the Company's and Holding's obligations hereunder
which are not otherwise specifically provided for in this Section. It is
understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of any of the
17
Securities by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters hereunder, as to the
Securities to be delivered at each Time of Delivery, shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company and Holding herein are, at and as of such Time of
Delivery, true and correct, the condition that the Company and Holding shall
have performed all of their obligations hereunder theretofore to be performed,
and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall
have been issued and no proceeding for that purpose shall have been
initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Debevoise & Xxxxxxxx, counsel for the Underwriters, shall have
furnished to you such opinion, dated such Time of Delivery, with
respect to the matters covered in paragraphs (i), (ii) (as to the
shares issuable upon conversion of the Securities), (v), (vi), (vii),
(viii), (xi) (as to the Securities and the Common Stock), (xiii) and
the last paragraph of subsection (c) below as well as such other
related matters as you may reasonably request; and such counsel shall
have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(c) Xxxx, Xxxxxxxx, Xxxxxxxx & Xxxxxx LLP, counsel for the Company
and Holding, shall have furnished to you their written opinion, dated
such Time of Delivery, in form and substance satisfactory to you, to
the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware; Holding has been duly formed and is validly
existing as a limited liability company in good standing under the
laws of the State of Delaware; each of the Company and Holding has
the power and authority (corporate or other) to own or lease its
properties and conduct its business as described in the Prospectus
and to execute, deliver and perform its obligations under this
Agreement;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus; the Securities are convertible into shares of
Common
18
Stock in accordance with the terms of the Indenture; the shares of
Common Stock initially issuable upon conversion of the Securities
have been duly and validly authorized and reserved for issuance
and, when issued and delivered in accordance with the provisions
of the Securities and the Indenture, will be duly and validly
issued and fully paid and non-assessable; and the Common Stock
conforms in all material respects to the description thereof
contained in the Prospectus under the caption "Description of
Capital Stock and Membership Units";
(iii) Holding has an authorized capitalization as set forth in
the Prospectus; and the Membership Units conform in all material
respects to the description thereof contained in the Prospectus
under the caption "Description of Capital Stock and Membership
Units";
(iv) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject which are likely to have,
individually or in the aggregate, a Material Adverse Effect; and,
to the best of such counsel's knowledge and other than as set
forth in the Prospectus, no such proceedings are overtly
threatened by governmental authorities or by others;
(v) This Agreement has been duly authorized, executed and
delivered by each of the Company and Holding;
(vi) The Securities have been duly authorized by the Company,
and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will
be valid and legally binding obligations of the Company, entitled
to the benefits provided by the Indenture and enforceable against
the Company in accordance with their terms, subject, as to
enforcement, to applicable bankruptcy, reorganization, insolvency
or other similar laws affecting creditors' rights generally and to
general equity principles;
(vii) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming the due execution and
delivery thereof by the Trustee) constitutes a valid and legally
binding instrument, enforceable against the Company in accordance
with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to
19
general equity principles; and the Indenture has been duly
qualified under the Trust Indenture Act;
(viii) The Securities and the Indenture conform in all
material respects to the descriptions thereof in the Prospectus
under the caption "Description of Notes";
(ix) The issue and sale of the Securities and the compliance
by the Company and Holding, as the case may be, with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein
contemplated, including the issuance of shares of Common Stock
upon conversion of the Securities, will not, to the best of such
counsel's knowledge, result in a material breach or violation of
any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement, lease,
license, permit or other agreement or instruments specifically
identified to such counsel by the Company as material to the
Company on a schedule, nor will any such action result in any
violation of the provisions of the restated certificate of
incorporation or by-laws of the Company, or the certificate of
formation or amended and restated limited liability company
agreement of Holding or any Federal or New York State statute or
any order, rule or regulation of any Federal or New York State
court or governmental agency or body having jurisdiction over the
Company or its subsidiaries or any of their properties;
(x) No consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency
or body referred to in paragraph (ix) is required for the issue
and sale of the Securities, the issue and delivery of shares of
Common Stock issuable upon conversion of the Securities or the
consummation by the Company and Holding of the transactions
contemplated by this Agreement or the Indenture, except the
registration under the Act of the Securities and the Common Stock
and such consents, approvals, authorizations, registrations or
qualifications as have been obtained or may be required under
state or foreign securities or Blue Sky laws in connection with
the purchase and distribution of the Securities by the
Underwriters and except such as may be requested by the NASD;
(xi) The statements set forth in the Prospectus under the
caption "Description of Notes" and "Description of Capital Stock
and Membership Units," insofar as they purport to constitute a
summary of the terms of the Securities and the Common Stock, and
under the captions "Description of Certain Indebtedness," "Certain
United States Tax
20
Considerations for Non-United States Holders of Class A Common
Stock", "Summary of Certain United States Federal Income Tax
Considerations for Holders of Notes," and "Indemnification of
Directors and Officers," insofar as they purport to describe the
provisions of the laws, documents and arrangements referred to
therein, fairly summarize the provisions of any such laws and
documents in all material respects;
(xii) Neither the Company nor Holding is an "investment
company" or an entity "controlled" by an "investment company," as
such terms are defined in the Investment Company Act;
(xiii) The Registration Statement and the Prospectus and any
further amendments and supplements thereto made by the Company
prior to such Time of Delivery (other than the financial
statements and related notes and schedules therein, as to which
such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Act and the Trust
Indenture Act and the rules and regulations thereunder, although
such counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those
referred to in the opinion; and
(xiv) The documents incorporated by reference in the
Prospectus or any further amendment or supplement thereto made by
the Company prior to such Time of Delivery (other than the
financial statements and related notes and schedules therein, as
to which such counsel need express no opinion), when they became
effective or were filed with the Commission, as the case may be,
complied as to form in all material respects with the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, although such counsel
does not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the documents
incorporated by reference in the Prospectus or any further
amendment or supplement thereto, except for those referred to in
the opinion.
Such counsel shall also state as follows: We have not
independently verified the accuracy, completeness or fairness of the
statements made or included in the Registration Statement or the
Prospectus, except as described in specified paragraphs of the
opinion. However, in connection with the preparation by the Company of
the Registration Statement and the Prospectus, we participated in
various discussions and meetings with the Underwriters'
representatives, officers and other representatives of the Company,
and representatives of the Company's
21
independent public accountants at which the contents of the
Registration Statement and the Prospectus were discussed. No
information has come to our attention which causes us to conclude
(relying as to factual matters, to the extent necessary to determine
materiality, upon the opinions of officers and other representatives
of the Company and Holding) that (i) the Registration Statement at the
time it became effective contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, and (ii)
the Prospectus, or any supplement thereto, on the date it was filed
pursuant to the rules and regulations under the Act and as of the date
hereof, contained an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading (except, in each case in respect of the Registration
Statement or the Prospectus or any supplement thereto, that we express
no view as to financial statements and notes thereto, financial
schedules and other financial information included therein or to the
exhibits to the Registration Statement).
(d) Xxxx, Xxxxxx & Xxxxxxxxx, L.L.P., special regulatory counsel
to the Company and Holding, shall have furnished to you their written
opinion, dated such Time of Delivery, in form and substance reasonably
satisfactory to you, to the effect that:
(i) The issue and sale of the Securities and the compliance by
the Company and Holding, as the case may be, with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein
contemplated do not and will not contravene the Cable Acts or any
order, rule or regulation of the FCC to which the Company or any
of its subsidiaries or any of their properties is subject;
(ii) To the best of such counsel's knowledge, no consent,
approval, authorization or order of, or registration,
qualification or filing with the FCC is required under the Cable
Acts or any order, rule or regulation of the FCC in connection
with the issue and sale of the Securities and the compliance by
the Company and Holding, as the case may be, with all of the
provisions of the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein
contemplated;
(iii) The statements set forth in the Prospectus under the
captions "Risk Factors" under the subheading "Regulatory and
Legislative Matters" and in "Regulation and Legislation," insofar
as they constitute summaries of laws referred to therein,
concerning the Cable Acts and the published
22
rules, regulations and policies promulgated by the FCC thereunder,
fairly summarize the matters described therein;
(iv) To the knowledge of such counsel based solely upon its
review of publicly available records of the FCC and operational
information provided by the Company's and its subsidiaries'
management, the Company and its subsidiaries hold all FCC licenses
for cable antenna relay services necessary to conduct the business
of the Company and its subsidiaries as currently conducted, except
to the extent the failure to hold such FCC licenses would not,
individually and in the aggregate, be reasonably expected to have
a Material Adverse Effect; and
(v) Except as disclosed in the Prospectus and except with
respect to rate regulation matters, and general rulemakings and
similar matters relating generally to the cable television
industry, to such counsel's knowledge, based solely upon its
review of the publicly available records of the FCC and upon
inquiry of the Company's and its subsidiaries' management, during
the time the cable systems of the Company and its subsidiaries
have been owned by the Company and its subsidiaries (A) there has
been no adverse FCC judgment, order or decree issued by the FCC
relating to the ongoing operations of any of the Company or one of
its subsidiaries that has had or could reasonably be expected to
have a Material Adverse Effect; and (B) there are no actions,
suits, proceedings, inquiries or investigations by or before the
FCC pending or threatened in writing against or specifically
affecting the Company or any of its subsidiaries or any cable
system of the Company or any of its subsidiaries which could,
individually or in the aggregate, be reasonably expected to result
in a Material Adverse Effect;
(e) Xxxxxx X. Xxxx, Esq., Senior Vice President, General Counsel
and Secretary of the Company and Holding, shall have furnished to you
his written opinion, dated the Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) Each subsidiary of the Company listed on a schedule
attached to such counsel's opinion (the "Charter Subsidiaries")
has been duly incorporated or formed, as the case may be, and is
validly existing as a corporation or limited liability company, as
the case may be, in good standing under the laws of its
jurisdiction of incorporation or formation; and all of the issued
shares of capital stock or limited liability company interests, as
the case may be, of each Charter Subsidiary have been duly and
validly authorized and issued and, assuming receipt of requisite
consideration therefore, are fully paid and non-assessable;
23
(ii) Each of the Company and the Charter Subsidiaries has been
duly qualified as a foreign corporation or limited liability
company, as the case may be, for the transaction of business and
is in good standing under the laws of each jurisdiction set forth
in a schedule to such counsel's opinion;
(iii) To the best of such counsel's knowledge and other than
as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
subsidiaries is party or of which any property of the Company or
any of its subsidiaries is the subject which are likely to have,
individually or in the aggregate, a Material Adverse Effect; and,
to the best of such counsel's knowledge and other than as set
forth in the Prospectus, no such proceedings are overtly
threatened by governmental authorities or by others; and
(f) On the date of the Prospectus at a time prior to the execution
of this Agreement, at 9:30 a.m., New York City time, on the effective
date of any post-effective amendment to the Registration Statement
filed subsequent to the date of this Agreement and also at each Time
of Delivery, each of Xxxxxx Xxxxxxxx LLP, KPMG LLP, Ernst & Young LLP
and PriceWaterhouseCoopers LLP, shall have furnished to you a letter
or letters, dated the respective dates of delivery thereof, in form
and substance satisfactory to you;
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus, and (ii) since the respective dates as
of which information is given in the Prospectus there shall not have
been any change in the capital stock, limited liability company
interests or long-term debt of the Company or any of its subsidiaries
or any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position,
stockholders' or members' equity, or results of operations of the
Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities being issued at such Time of Delivery on the terms and in
the manner contemplated in the Prospectus;
(h) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the debt securities of the Company or
any of its subsidiaries
24
by any "nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule 436(g)(2)
under the Act, and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible
negative implications, its rating of any of the debt securities of the
Company or any of its subsidiaries;
(i) On or after the date hereof there shall not have occurred any
of the following: (i) a suspension or material limitation in trading
in securities generally on the New York Stock Exchange or on the
Nasdaq; (ii) a suspension or material limitation in trading in the
Common Stock on the Nasdaq, (iii) a general moratorium on commercial
banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war, if the effect of any such event specified
in this clause (iv) in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities being issued at such Time of Delivery
on the terms and in the manner contemplated in the Prospectus;
(j) The Company and Holding shall have furnished or caused to be
furnished to you at such Time of Delivery certificates of officers of
each of the Company and Holding satisfactory to you as to the accuracy
of the representations and warranties of each of the Company and
Holding herein at and as of such Time of Delivery, as to the
performance by each of the Company and Holding of all of its
obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (g) of
this Section and as to such other matters as you may reasonably
request;
(k) The Company has obtained and delivered to the Underwriters
executed copies of an agreement from the persons and entities named in
Schedule II hereto, substantially to the effect set forth in lock-up
agreements delivered in connection with the Company's October 2000
issuance of convertible senior notes;
(l) The shares of Common Stock issuable upon conversion of the
Securities shall have been duly listed, subject to notice of issuance,
on the Nasdaq; and
(m) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of this Agreement.
8. (a) The Company and Holding, jointly and severally, will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities,
25
joint or several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company and Holding shall not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus or any such amendment or supplement
in reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Xxxxxx Xxxxxxx & Co. Incorporated and
Xxxxxxx, Xxxxx & Co. expressly for use therein.
(b) The Underwriters, severally and not jointly, will indemnify
and hold harmless the Company and Holding against any losses, claims, damages or
liabilities to which the Company or Holding may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any such amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx & Co.
expressly for use therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
26
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. Any indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified
parties. The Company and Holding shall not be required to indemnify the
Underwriters for any amounts paid or payable by the Underwriters in the
settlement of any action, proceeding or investigation without the written
consent of the Company to such settlement, which consent shall not be
unreasonably withheld. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to,
or an admission of, fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and Holding on the one hand and the
Underwriters on the other from the offering of the Securities. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and Holding on the one hand and the Underwriters on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company and Holding on the one hand and the Underwriters on the other
shall be deemed to be in the same
27
proportion as the total net proceeds from the offering of the Securities
purchased under this Agreement (before deducting expenses) received by the
Company and Holding bear to the total underwriting discounts and commissions
received by the Underwriters with respect to the Securities purchased under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and Holding on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
Holding and the Underwriters agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this subsection (d),
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company and Holding under this Section
8 shall be in addition to any liability which the Company and Holding may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and Holding and to each person, if any, who controls the Company or
Holding within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Securities which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or other
parties to purchase such Securities on the terms contained herein at such Time
of Delivery. If within thirty-six hours after such default by any Underwriter
you do not arrange for the purchase of such
28
Securities, then the Company shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to you
to purchase such Securities on such terms. In the event that, within the
respective prescribed periods, you notify the Company that you have so arranged
for the purchase of such Securities, or the Company notifies you that it has so
arranged for the purchase of such Securities, you or the Company shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Securities.
(b) If, after giving effect to any arrangements for the purchase
of the Securities of a defaulting Underwriter or Underwriters by you and the
Company as provided in subsection (a) above, the aggregate principal amount of
such Securities which remains unpurchased does not exceed one-eleventh of the
aggregate principal amount of all the Securities to be purchased at such Time of
Delivery, then the Company shall have the right to require each non-defaulting
Underwriter to purchase the principal amount of Securities which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the principal amount of Securities which such Underwriter agreed
to purchase hereunder) of the Securities of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase
of the Securities of a defaulting Underwriter or Underwriters by you and the
Company as provided in subsection (a) above, the aggregate principal amount of
Securities which remains unpurchased exceeds one-eleventh of the aggregate
principal amount of all the Securities to be purchased at such Time of Delivery,
or if the Company shall not exercise the right described in subsection (b) above
to require non-defaulting Underwriters to purchase Securities of a defaulting
Underwriter or Underwriters (or, with respect to the Second Time of Delivery,
the obligations of the Underwriters to purchase and of the Company to sell the
Optional Securities), then this Agreement shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter, the Company or Holding,
except for the expenses to be borne by the Company, Holding and the Underwriters
as provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
29
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and Holding and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company and Holding, or any officer or director or
controlling person of the Company or Holding, and shall survive delivery of and
payment for the Securities.
11. If this Agreement shall be terminated pursuant to Section 9
hereof, the Company and Holding shall not then be under any liability to any
Underwriter except as provided in Sections 6 and 8 hereof; but, if, for any
other reason other than a termination pursuant to Section 7(i), any Securities
are not delivered by or on behalf of the Company as provided herein, the Company
and Holding will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Securities, but the Company and Holding shall
then be under no further liability to any Underwriter except as provided in
Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of
the Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx, Xxxxx
& Co. on behalf of you as the Representatives.
All statements, requests, notices and agreements hereunder shall
be in writing, and if to the Underwriters shall be delivered or sent by mail,
telex or facsimile transmission to you as the Representatives in care of Xxxxxx
Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
High Yield Capital Markets Department, and Xxxxxxx, Xxxxx & Co., 00 Xxx Xxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration Department; and if
to the Company or Holding shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, Holding, and, to the extent provided
in Sections 8 and 10 hereof, the officers and directors of the Company and each
person who controls
30
the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such respective counterparts shall together constitute
one and the same instrument.
31
If the foregoing is in accordance with your understanding, please
sign and return to us counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement between each of the Underwriters,
the Company and Holding. It is understood that your acceptance of this letter on
behalf of each of the Underwriters is pursuant to the authority set forth in a
form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination upon request, but without warranty on your part as
to the authority of the signers thereof.
Very truly yours,
Charter Communications, Inc.
By: /s/ Xxxxxx X. Xxxx
-------------------------------
Name: Xxxxxx X. Xxxx
Title: Senior Vice President, General Counsel
and Secretary
Charter Communications Holding Company, LLC
By: /s/ Xxxxxx X. Xxxx
-------------------------------
Name: Xxxxxx X. Xxxx
Title: Senior Vice President, General Counsel
and Secretary
32
Accepted as of the date hereof:
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx, Xxxxx & Co.
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
X.X. Xxxxxx Securities LLC
Credit Lyonnais Securities (USA) Inc.
Fleet Securities, Inc.
BMO Xxxxxxx Xxxxx
Dresdner Kleinwort Xxxxxxxxxxx Securities LLC
Acting severally on behalf of themselves and the several Underwriters named in
Schedule I hereto.
By: Xxxxxxx, Xxxxx & Co.
By: /s/ Xxxxxxx, Xxxxx & Co.
---------------------------------
Name:
Title:
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Principal
33
SCHEDULE I
Principal Amount of Principal Amount of
Firm Securities Optional Securities
Underwriter to be Purchased to be Purchased
----------- --------------- ---------------
Xxxxxx Xxxxxxx & Co. Incorporated....................... $192,500,000 $28,875,000
Xxxxxxx, Xxxxx & Co. ................................... 192,500,000 28,875,000
Banc of America Securities LLC.......................... 27,500,000 4,125,000
Bear, Xxxxxxx & Co. Inc................................. 27,500,000 4,125,000
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated...... 27,500,000 4,125,000
Xxxxxxx Xxxxx Xxxxxx Inc................................ 27,500,000 4,125,000
X.X. Xxxxxx Securities LLC.............................. 22,000,000 3,300,000
Credit Lyonnais Securities (USA) Inc.................... 11,000,000 1,650,000
Fleet Securities, Inc................................... 11,000,000 1,650,000
BMO Xxxxxxx Xxxxx ...................................... 5,500,000 825,000
Dresdner Kleinwort Xxxxxxxxxxx Securities LLC........... 5,500,000 825,000
------------- ---------------
Total $550,000,000 $82,500,000
SCHEDULE II
Xxxx X. Xxxxx
Xxxxxx X. Xxxx
Xxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxxx
Xxxxxxx X. Xxxxx
Xxxxxx X. Xxxx
Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxx
Xxxx Xxx Xxxxx
Xxxx X. Xxxxxxxxxx
Xxxxxx X. Xxxxxxx
Xxxx X. Xxxxxxxx
Xxxxx X. Xxxxx
Xxxxx X. XxXxxx
Xxxxx X. Mir
Xxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxx
Xxxxxxx X. Xxxxx
Xxxxx (Xxxx) X. Xxxxx, III
Charter Communications Holding Company, LLC
Vulcan Cable III Inc.
Charter Investment, Inc.
