EXHIBIT: 10.12
EXECUTION COPY
GUARANTEE
GUARANTEE, dated as of March 31, 2003, made by TIME WARNER
ENTERTAINMENT COMPANY, L.P. a Delaware limited partnership ("TWE")
("Guarantor"), in favor of DEUTSCHE BANK AG, NEW YORK BRANCH and CITICORP NORTH
AMERICA, INC., as Co-Administrative Agents (in such capacity, the
"Administrative Agents") for the lenders (the "Lenders") parties to the Term
Loan Agreement, dated as of March 31, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Term Loan Agreement"), among MOTH
HOLDINGS, INC. (to be renamed Time Warner Cable Inc.), the Lenders and the
Administrative Agents.
W I T N E S S E T H :
WHEREAS, pursuant to the Term Loan Agreement, the Lenders have
severally agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS it is a condition precedent to the obligation of the
Lenders to make their respective Loans to the Borrower under the Term Loan
Agreement that the Guarantor shall have executed and delivered this Guarantee to
the Administrative Agents for the ratable benefit of the Lenders; and
WHEREAS Guarantor will upon consummation of the Restructuring
become a subsidiary of the Borrower under the Term Loan Agreement, and it is to
the advantage of Guarantor that the Lenders make the Loans to the Borrower under
the Term Loan Agreement.
NOW, THEREFORE, in consideration of the premises and to induce
the Administrative Agents and the Lenders to enter into the Term Loan Agreement
and to induce the Lenders to make their respective loans to the Borrower under
the Term Loan Agreement, Guarantor hereby agrees with the Administrative Agents,
for the ratable benefit of the Lenders, as follows:
1. Defined Terms. Unless otherwise defined herein, terms
defined in the Term Loan Agreement and used herein shall have the meanings given
to them in the Term Loan Agreement.
(a) As used herein, "Borrower" means MOTH Holdings, Inc.
(and, once renamed as described in the preamble hereto, Time Warner Cable Inc.,
as successor in interest).
(b) As used herein, "Obligations" means the collective
reference to the unpaid principal of and interest on the Loans, fees and all
other obligations and liabilities of the Borrower to the Administrative Agents,
the Paying Agent and the Lenders (including, without
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limitation, interest accruing at the then applicable rate provided in the Term
Loan Agreement after the maturity of the Loans and interest accruing at the then
applicable rate provided in the Term Loan Agreement after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to either one or both of the Borrower whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding),
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, the Term Loan Agreement or any other Credit Document, in each case whether
on account of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to the Administrative Agents, the Paying Agent or to
the Lenders that are required to be paid by the Borrower pursuant to the terms
of the Term Loan Agreement or any other Credit Document).
(c) The words "hereof," "herein" and "hereunder" and
words of similar import when used in this Guarantee shall refer to this
Guarantee as a whole and not to any particular provision of this Guarantee, and
section and paragraph references are to this Guarantee unless otherwise
specified.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.
2. Guarantee. Immediately following consummation of the
Restructuring, TWE unconditionally and irrevocably guarantees to the
Administrative Agents, for the ratable benefit of the Administrative Agents, the
Paying Agent and the Lenders and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Obligations. Without limiting the generality of the foregoing, the
Guarantor's liability shall extend to all amounts that constitute part of the
guaranteed Obligations and would be owed by the Borrower to the Bank under the
Credit Documents but for the fact that they are unenforceable or not allowable
due to the existence of a bankruptcy, reorganization or similar proceeding
involving the Borrower.
(a) This Guarantee shall remain in full force and effect
until the Obligations are paid in full.
(b) Guarantor agrees that whenever, at any time, or from
time to time, it shall make any payment to the Administrative Agents, the Paying
Agent or any Lender on account of its liability hereunder, it will notify the
Administrative Agents and such Lender in writing that such payment is made under
this Guarantee for such purpose.
(c) Anything herein or in any other Credit Document to
the contrary notwithstanding, the maximum liability of Guarantor hereunder and
under the other Credit
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Documents shall in no event exceed the amount which can be guaranteed by such
Guarantor under applicable federal and state laws relating to the insolvency of
debtors.
(d) No payment or payments made by the Borrower, the
Guarantor, any other guarantor or any other Person or received or collected by
the Administrative Agents, the Paying Agent or any Lender from the Borrower, the
Guarantor, any other guarantor or any other Person by virtue of any action or
proceeding or any setoff or appropriation or payment of the Obligations shall be
deemed to modify, reduce, release or otherwise affect the liability of the
Guarantor hereunder who shall, notwithstanding any such payment or payments
(other than payments made by the Guarantor in respect of the Obligations or
payments received or collected from the Guarantor in respect of the
Obligations), remain liable for the Obligations up to the maximum liability of
the Guarantor hereunder until the Obligations are paid indefeasibly in full.
3. Right of Setoff. If an Event of Default shall have
occurred and be continuing, TWE hereby authorizes each Lender at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final),
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of TWE (other than indebtedness related to
commercial advertising and marketing arrangements entered into in the ordinary
course of business) against any of and all the obligations of TWE now or
hereafter existing under the Term Loan Agreement or any other Credit Document
held by such Lender whether or not such Lender has made any demand for payment
and although such obligations may be unmatured. Each Lender shall notify TWE
promptly of any such setoff and the application made by such Lender of the
proceeds thereof; provided that the failure to give such notice shall not affect
the validity of such setoff and application. The rights of each Lender under
this paragraph are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.
4. No Subrogation. Notwithstanding any payment or
payments made by Guarantor hereunder, or any setoff or application of funds of
Guarantor by any Lender, Guarantor shall not be entitled to be subrogated to any
of the rights of the Administrative Agents or any Lender against the Borrower or
against any collateral security or guarantee or right of offset held by the
Administrative Agents or any Lender for the payment of the Obligations, nor
shall Guarantor seek or be entitled to seek any contribution or reimbursement
from the Borrower in respect of payments made by Guarantor hereunder, until all
amounts owing to the Administrative Agents and the Lenders by the Borrower on
account of the Obligations are paid indefeasibly in full. If any amount shall be
paid to Guarantor on account of such subrogation rights at any time when all of
the Obligations shall not have been paid in full, such amount shall be held by
Guarantor in trust for the Administrative Agents and the Lenders, segregated
from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor,
be
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turned over to the Administrative Agents in the exact form received by Guarantor
(duly indorsed by Guarantor to the Administrative Agents, if required), to be
applied against the Obligations, whether matured or unmatured, in such order as
the Administrative Agents may determine.
5. Amendments, etc. with Respect to the Obligations;
Waiver of Rights. Guarantor shall remain obligated hereunder notwithstanding
that, without any reservation of rights against Guarantor, and without notice to
or further assent by Guarantor, (a) any demand for payment of any of the
Obligations made by the Administrative Agents, the Paying Agent or any Lender
may be rescinded by the Administrative Agents, the Paying Agent or such Lender,
and any of the Obligations continued, (b) the Obligations or the liability of
any other Person upon or for any part thereof, or any collateral security or
guarantee therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Administrative Agents, the
Paying Agent or any Lender, (c) the Term Loan Agreement and any other Credit
Document may be amended, modified, supplemented or terminated, in whole or in
part, and (d) any collateral security, guarantee or right of offset at any time
held by the Administrative Agents, the Paying Agent or any Lender for the
payment of the Obligations may be sold, exchanged, waived, surrendered or
released. Neither the Administrative Agents nor any Lender shall have any
obligation to protect, secure, perfect or insure any Lien at any time held by it
as security for the Obligations or for this Guarantee or any property subject
thereto.
6. Guarantee Absolute and Unconditional. Guarantor
waives any and all notice of the creation, renewal, extension or accrual of any
of the Obligations and notice of or proof of reliance by the Administrative
Agents, the Paying Agent or any Lender upon this Guarantee or acceptance of this
Guarantee; the Obligations, and any of them, shall conclusively be deemed to
have been created, contracted or incurred, or renewed, extended, amended or
waived, in reliance upon this Guarantee; and all dealings between the Borrower
or the Guarantor, on the one hand, and the Administrative Agents, the Paying
Agent and the Lenders, on the other, shall likewise be conclusively presumed to
have been had or consummated in reliance upon this Guarantee. Guarantor waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon the Borrower or Guarantor with respect to the Obligations.
This Guarantee shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity, regularity or
enforceability of the Term Loan Agreement or any other Credit Document, any of
the Obligations or any other collateral security therefor or guarantee or right
of offset with respect thereto at any time or from time to time held by the
Administrative Agents, the Paying Agent or any Lender, (b) any defense, setoff
or counterclaim (other than a defense of payment or performance) which may at
any time be available to or be asserted by the Borrower or any other Person
against the Administrative Agents, the Paying Agent or any Lender, or (c) any
other circumstance whatsoever (with or without notice to or knowledge of the
Borrower or Guarantor)
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which constitutes, or might be construed to constitute, an equitable or legal
discharge of the Borrower from the Obligations, or of Guarantor under this
Guarantee, in bankruptcy or in any other instance. When making a demand
hereunder or otherwise pursuing its rights and remedies hereunder against
Guarantor, the Administrative Agents, the Paying Agent and any Lender may, but
shall be under no obligation to, make a similar demand on or otherwise pursue
such rights and remedies as it may have against the Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee
for the Obligations or any right of offset with respect thereto, and any failure
by the Administrative Agents or any Lender to make any such demand, to pursue
such other rights or remedies or to collect any payments from the Borrower,
Guarantor or any such other Person or to realize upon any such collateral
security or guarantee or to exercise any such right of offset, or any release of
the Borrower, Guarantor or any such other Person or of any such collateral
security, guarantee or right of offset, shall not relieve Guarantor of any
liability hereunder, and shall not impair or affect the rights and remedies,
whether express, implied or available as a matter of law, of the Administrative
Agents, the Paying Agent or any Lender against Guarantor. For the purposes
hereof "demand" shall include the commencement and continuance of any legal
proceedings.
7. Reinstatement. This Guarantee shall continue to be
effective, or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any of the Obligations is rescinded or must otherwise be
restored or returned by the Administrative Agents, Paying Agent or any Lender
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or upon or as a result of the appointment of a receiver, intervenor
or conservator of, or trustee or similar officer for, the Borrower or any
substantial part of the Borrower's property, or otherwise, all as though such
payments had not been made.
8. Payments. Guarantor hereby agrees that payments
hereunder will be paid to the Administrative Agents or to the Paying Agent, if
any, without setoff or counterclaim in the lawful money of the United States at
the office of the Administrative Agents or Paying Agent, if any, specified in
the Term Loan Agreement for payments thereunder.
9. Representations and Warranties. To induce the
Administrative Agents, the Paying Agent and the Lenders to enter into the Term
Loan Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrower thereunder, Guarantor hereby represents and warrants to
the Administrative Agents and each Lender that the representations and
warranties set forth in Article III of the Term Loan Agreement as they relate to
the Guarantor or to the Credit Documents to which Guarantor is a party, each of
which is hereby incorporated herein by reference, are true and correct, and the
Administrative Agents and each Lender shall be entitled to rely on each of them
as if they were fully set forth herein (it being understood that any
representation or warranty set forth in Article III of the Term Loan Agreement
shall apply to the Guarantor and its Subsidiaries in the manner set forth in
such Article III).
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10. Authority of Administrative Agents. Guarantor
acknowledges that the rights and responsibilities of the Administrative Agents
under this Guarantee with respect to any action taken by the Administrative
Agents or the exercise or non-exercise by the Administrative Agents of any
option, right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Guarantee shall, as between the Administrative
Agents and the Lenders, be governed by the Term Loan Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Administrative Agents and Guarantor, the Administrative Agents
shall be conclusively presumed to be acting as Agents for the Lenders with full
and valid authority so to act or refrain from acting, and Guarantor shall not be
under any obligation, or entitlement, to make any inquiry respecting such
authority.
11. Notices. All notices, requests and demands to or upon
the Administrative Agents, any Lender or Guarantor shall be effected in the
manner provided in Section 9.01 of the Term Loan Agreement; any such notice,
request or demand to or upon Guarantor shall be addressed to Guarantor at its
notice address set forth on Schedule 1 hereto.
12. Severability. Any provision of this Guarantee which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
13. Integration. This Guarantee and the other Credit
Documents represent the agreement of Guarantor with respect to the subject
matter hereof and there are no promises or representations by Guarantor, the
Administrative Agents, the Paying Agent or any Lender relative to the subject
matter hereof not reflected herein or in the other Credit Documents.
14. Amendments in Writing. Subject to Section 9.02 of the
Term Loan Agreement, None of the terms or provisions of this Guarantee may be
waived, amended, supplemented or otherwise modified except by a written
instrument executed by Guarantor and the Administrative Agents, provided that
any right, power or privilege of the Administrative Agents or the Lenders
arising under this Guarantee may be waived by the Administrative Agents and the
Lenders in a letter or agreement executed by the Administrative Agents;
provided, further, that no such amendment or waiver shall release Guarantor from
its obligations hereunder without the written consent of each Lender.
15. No Waiver; Cumulative Remedies. Neither the
Administrative Agents, the Paying Agent nor any Lender shall by any act (except
by a written instrument pursuant to paragraph 15 hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
ex-
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ercising, on the part of the Administrative Agents, the Paying Agent or any
Lender, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Administrative Agents,
the Paying Agent or any Lender of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right or remedy which the
Administrative Agents, the Paying Agent or such Lender would otherwise have on
any future occasion. The rights and remedies herein provided are cumulative, may
be exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
16. Taxes. Any and all payments by or on account of any
Obligation hereunder shall be made by Guarantor in accordance with the
provisions of Section 2.16 of the Term Loan Agreement.
17. Section Headings. The section headings used in this
Guarantee are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.
18. Successors and Assigns. This Guarantee shall be
binding upon the successors and assigns of Guarantor and shall inure to the
benefit of the Administrative Agents and the Lenders and their successors and
assigns; provided that Guarantor may not assign, transfer or delegate any of its
rights or obligations under this Guarantee without the prior written consent of
the Administrative Agents.
19. Enforcement Expenses. Guarantor agrees, jointly and
severally, to pay or reimburse each Lender, the Paying Agent and the
Administrative Agents for all its costs and expenses incurred in collecting
against Guarantor under this Guarantee or otherwise enforcing or protecting any
rights under this Guarantee and the other Credit Documents to which such
Guarantor is a party, including, without limitation, the fees and disbursements
of counsel to each Lender and of counsel to the Administrative Agents.
20. Acknowledgements. Guarantor hereby acknowledges that
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Guarantee;
(b) neither the Administrative Agents, the Paying Agent
nor any Lender has any fiduciary relationship with or duty to Guarantor
arising out of or in connection with this Guarantee or any other Credit
Document, and the relationship between Guarantor, on the one hand, and
the Administrative Agents, the Paying Agent and Lenders, on the other
hand, in connection herewith or therewith is solely that of debtor and
creditor; and
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(c) no joint venture is created hereby or by the other
Credit Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Guarantor and the
Lenders.
21. GOVERNING LAW. THIS GUARANTEE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
22. Jurisdiction; Consent to Service of Process.
Guarantor hereby irrevocably and unconditionally submits, for itself and its
property, to the jurisdiction of the Supreme Court of the State of New York
sitting in New York County and of the United States District Court of the
Southern District of New York, and any appellate court from any thereof, in any
action or proceeding arising out of or relating to this Guarantee, or for
recognition or enforcement of any judgment, and Guarantor hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding shall be heard and determined in such New York State court or, to the
extent permitted by law, in such Federal court. Guarantor agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
(a) Guarantor hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Guarantee in any court
referred to in paragraph (a) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
(b) Guarantor irrevocably consents to service of process
in the manner provided for notices in paragraph 11 of this Guarantee. Nothing in
this Guarantee will affect the right of any party to this Guarantee to serve
process in any other manner permitted by law.
23. WAIVER OF JURY TRIAL. GUARANTOR HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS GUARANTEE OR ANY OTHER CREDIT DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.
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IN WITNESS WHEREOF, the undersigned has caused this Guarantee
to be duly executed and delivered by its duly authorized officer as of the day
and year first above written.
TIME WARNER ENTERTAINMENT COMPANY, L.P.
By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
Title: Vice President, Corporate Finance
SCHEDULE I
TO GUARANTEE
Address for Notices
TIME WARNER ENTERTAINMENT COMPANY, L.P.
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Chief Financial Officer
Facsimile: No.: 000-000-0000
Attention: General Counsel
Facsimile No.: 000-000-0000