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EXHIBIT 2.1
EXECUTION COPY
Bresnan Communications Group LLC
Bresnan Capital Corporation
8% Senior Notes due 2009
9 1/4% Senior Discount Notes due 2009
Purchase Agreement
New York, New York
January 25, 1999
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxx Securities Inc.
Xxxxxx Xxxxxxx & Co. Incorporated
TD Securities (USA) Inc.
In care of:
Xxxxxxx Xxxxx Xxxxxx Inc.
Seven World Trade Center
New York, New York 10048
Ladies and Gentlemen:
Bresnan Communications Group LLC, a limited liability company
organized under the laws of Delaware (the "Company"), and Bresnan Capital
Corporation, a corporation organized under the laws of Delaware ("BCC"), propose
to issue and sell to the several parties named in Schedule I hereto (the
"Initial Purchasers"), for whom you (the "Representatives") are acting as
representatives, $170,000,000 aggregate principal amount of their 8% Senior
Notes due 2009 (the "Senior Notes") and $275,000,000 aggregate principal amount
at maturity ($175,021,000 gross proceeds) of their 9 1/4% Senior Discount Notes
due 2009 (the "Senior Discount Notes" and, together with the Senior Notes, the
"Securities"). The Securities are to be issued under an indenture (the
"Indenture"), dated as of the Closing Date (as defined below), among the
Company, BCC and State Street Bank and Trust Company, as trustee (the
"Trustee"). The Securities have the benefit of a registration rights agreement
(the "Registration Rights Agreement"), dated as of the Execution Time (as
defined below), among the Company, BCC and the Initial Purchasers, pursuant to
which the Company and BCC have agreed to register the Securities under the Act
(as defined below) subject to the terms and conditions therein specified. To the
extent there are no additional parties listed on Schedule I other than you, the
term
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Representatives as used herein shall mean you as the Initial Purchasers,
and the terms Representatives and Initial Purchasers shall mean either the
singular or plural as the context requires. The use of the neuter in this
Agreement shall include the feminine and masculine wherever appropriate.
Capitalized terms used herein without definition have the respective meanings
assigned to them in the Final Memorandum (as defined below). Certain terms used
herein are defined in Section 18 hereof.
The sale of the Securities to the Initial Purchasers will be
made without registration of the Securities under the Act in reliance upon
exemptions from the registration requirements of the Act.
In connection with the sale of the Securities, the Company and
BCC have prepared a preliminary offering memorandum, dated January 14, 1999 (the
"Preliminary Memorandum"), and a final offering memorandum, dated January 25,
1999 (as amended or supplemented at the Execution Time, the "Final Memorandum").
Each of the Preliminary Memorandum and the Final Memorandum sets forth certain
information concerning the Company, BCC and the Securities. Each of the Company
and BCC hereby confirms that it has authorized the use of the Preliminary
Memorandum and the Final Memorandum, and any amendment or supplement thereto, in
connection with the offer and sale of the Securities by the Initial Purchasers.
In the event that the Funding Conditions (as set forth in the
escrow agreement, the form of which is attached hereto as Exhibit B (the "Escrow
Agreement")) are not satisfied on or prior to the Closing Date, on the Closing
Date, the Company and BCC will execute the Escrow Agreement and deposit with
State Street Bank and Trust Company, as escrow agent (the "Escrow Agent"), the
net proceeds of the offering of the Securities, together with certain other
funds or letters of credit (such net proceeds and other funds or letters of
credit are collectively referred to herein as the "Escrowed Funds") in an amount
sufficient to redeem the Securities at a mandatory redemption price in cash
equal to 101% of the aggregate principal amount or accreted value thereof plus,
in the case of the Senior Notes, accrued and unpaid interest, if any, to the
redemption date, based on the assumption that the redemption would occur on May
14, 1999 (the "Mandatory Redemption Price"). Assuming execution of the Escrow
Agreement on the Closing Date, either (i) upon the satisfaction of the
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Funding Conditions, the Escrowed Funds will be released to the Company or (ii)
in the event the Funding Conditions are not satisfied on or before April 30,
1999 or the Contribution Agreement is terminated prior to such date, the
Escrowed Funds will be used to pay the Mandatory Redemption Price for the
Securities.
In connection with the consummation of the TCI Transactions
and satisfaction of the Funding Conditions, certain affiliates of TCI listed on
Exhibit A to the Contribution Agreement (collectively, the "TCI Systems
Parties") will contribute the Contributed TCI Systems and certain related
obligations and liabilities to TCI Bresnan LLC, which entity will also be
assigned the Assumed TCI Debt, and, in connection with the consummation of the
TCI Transactions, the Contributed TCI Systems and the Assumed TCI Debt will be
transferred to BCCLP. BCCLP will, in connection with the consummation of the TCI
Transactions, contribute all its operating assets and liabilities, including the
Existing Bresnan Systems and the Contributed TCI Systems, to the Company, which
will contribute such assets and some or all of such liabilities to, Bresnan
Telecommunications Company LLC, a Delaware limited liability company and wholly
owned subsidiary of the Company ("BTC"). As used herein, the "Business" means
the Company and its subsidiaries, taken as a whole after giving pro forma effect
to the TCI Transactions and the Financings and the "Combined Company" means the
Company, after giving pro forma effect to the TCI Transactions and the
Financings. In the event that the Funding Conditions are satisfied and the TCI
Transactions are consummated at or prior to Closing, all obligations relating to
the Escrow Agreement, including the delivery of any opinions with respect
thereto, shall not be applicable.
1. Representations and Warranties.
(a) Each of the Company and BCC represents and warrants to
each Initial Purchaser as set forth below in this Section 1.
(i) At the Execution Time and on the Closing Date,
the Final Memorandum did not and will not (and any amendment
or supplement thereto, at the date thereof and at the Closing
Date, will not), contain any untrue statement of a material
fact or omit to state any material fact necessary to make the
statements
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therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that neither the
Company nor BCC makes any representation or warranty as to the
information contained in or omitted from the Final Memorandum,
or any amendment or supplement thereto, in reliance upon and
in conformity with information furnished in writing to the
Company by or on behalf of the Initial Purchasers through the
Representatives specifically for inclusion therein.
(ii) None of the Company, BCC, any of their
respective Affiliates or any person acting on behalf of any of
them (provided that no representation or warranty is made as
to the activities of any Initial Purchaser or any person
acting on its behalf) has, directly or indirectly, made offers
or sales of any security, or solicited offers to buy any
security, under circumstances that would require the
registration of the Securities under the Act.
(iii) None of the Company, BCC, any of their
respective Affiliates or any person acting on behalf of any of
them (provided that no representation or warranty is made as
to the activities of any Initial Purchaser or any person
acting on its behalf) has engaged in any form of general
solicitation or general advertising (within the meaning of
Regulation D) in connection with any offer or sale of the
Securities in the United States.
(iv) The Securities satisfy the eligibility
requirements of Rule 144A(d)(3) under the Act.
(v) None of the Company, BCC, any of their respective
Affiliates or any person acting on behalf of any of them
(provided that no representation or warranty is made as to the
activities of any Initial Purchaser or any person acting on
its behalf) has engaged in any directed selling efforts with
respect to the Securities, and each of them has complied with
the offering restrictions requirement of Regulation S. Terms
used in this paragraph have the meanings given to them by
Regulation S.
(vi) The Company and BCC have been advised by The
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Portal Market of the NASD that the Securities have been
designated Portal-eligible securities in accordance with the
rules and regulations of the NASD.
(vii) Neither the Company nor BCC is, and after
giving effect to the offering and sale of the Securities and
the application of the proceeds thereof as described in the
Final Memorandum will not be, an "investment company" within
the meaning of the Investment Company Act, without taking
account of any exemption arising out of the number of holders
of the Company's securities.
(viii) Neither the Company nor BCC has paid or agreed
to pay to any person any compensation for soliciting another
to purchase any of the Securities (except as contemplated by
this Agreement).
(ix) Neither the Company nor BCC has taken, directly
or indirectly, any action prohibited by Regulation M under the
Exchange Act in connection with the offering of the
Securities.
(x) The information provided by the Company or BCC
pursuant to Section 5(h) hereof will not, at the date thereof,
contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
(xi) Each of the Company, BCC and BCCLP has been duly
formed or incorporated, as applicable, and is validly existing
as a limited liability company, limited partnership or
corporation, as applicable, in good standing under the laws of
the jurisdiction in which it is chartered or organized with
full corporate, limited liability company or limited
partnership power and authority to own or lease, as the case
may be, and to operate its properties and conduct its business
as described in the Final Memorandum, and is duly qualified to
do business as a foreign corporation and is in good standing
under the laws of each jurisdiction which requires such
qualification, except where the
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failure to be so qualified, individually or in the aggregate,
could not reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Business; each of the
Company's subsidiaries (excluding BCC) has been duly formed
and is validly existing as a limited liability company or
corporation, as applicable, under the laws of the jurisdiction
in which it is chartered or organized with full corporate or
limited liability company power, as applicable, and authority
to own or lease, as the case may be, and to operate its
properties and conduct its business as described in the Final
Memorandum, and is duly qualified to do business as a foreign
entity and is in good standing under the laws of each
jurisdiction which requires such qualification, except where
the failure to be so qualified, individually or in the
aggregate, could not reasonably be expected to have a material
adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Business.
(xii) This Agreement and the Registration Rights
Agreement have been duly authorized, executed and delivered by
each of the Company and BCC; each of the Indenture and the
Escrow Agreement has been duly authorized, and when executed
and delivered by each of the Company and BCC, assuming due
authorization, execution and delivery thereof by the other
parties thereto, will constitute a legal, valid and binding
instrument enforceable against each of the Company and BCC in
accordance with its terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
creditors' rights and remedies generally from time to time in
effect, and to general principles of equity, including,
without limitation, concepts of materiality, reasonableness,
good faith and fair dealing, regardless of whether considered
in a proceeding in equity or at law); the Securities have been
duly authorized, and, when executed and authenticated in
accordance with the provisions of the Indenture, and delivered
to and paid for by the Initial Purchasers in accordance with
the terms of this Agreement, will have been duly executed and
delivered by each of the Company and BCC and will constitute
the
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legal, valid and binding obligations of each of the Company
and BCC entitled to the benefits of the Indenture (subject to
applicable bankruptcy, reorganization, insolvency, moratorium
or other laws affecting creditors' rights and remedies
generally from time to time in effect and to general
principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing,
regardless of whether considered in a proceeding in equity or
at law).
(xiii) No consent, approval, authorization, filing
with or order of any court or governmental agency or body is
required in connection with the transactions contemplated
herein, in the Indenture, the Registration Rights Agreement
and the Escrow Agreement except such as will be obtained under
the Act and the Trust Indenture Act, such as may be required
under the blue sky laws of any jurisdiction in connection with
the transactions contemplated by the Registration Rights
Agreement, such as may be required under such blue sky laws in
connection with the purchase and distribution of the
Securities by the Initial Purchasers in the manner
contemplated herein and in the Final Memorandum.
(xiv) The TCI Transactions will be consummated in
accordance with the terms of the Contribution Agreement (and
the related agreements referenced therein), provided that the
terms of such transactions and the assets and businesses
combined pursuant thereto will conform in all material
respects to the descriptions thereof contained throughout the
Final Memorandum (subject to any changes contemplated
therein).
(xv) The execution and delivery of this Agreement,
the Indenture, the Registration Rights Agreement, the Escrow
Agreement and the Contribution Agreement, the issue and sale
of the Securities, the consummation of any other of the
transactions herein or therein contemplated and the
fulfillment of the terms hereof or thereof will not conflict
with, result in a breach or violation or imposition of any
lien, charge or encumbrance upon any property or assets of the
Company, BCC, the Combined Company or any of their
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respective subsidiaries pursuant to:
(1) the charter or certificate of formation,
as the case may be, or by-laws, limited partnership
agreement or limited liability company agreement, as
the case may be, of the Company, BCC or any of their
respective subsidiaries;
(2) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition,
covenant or instrument to which the Company, BCC, the
Combined Company or any of their respective
subsidiaries is a party or bound or to which their
respective property is subject; or
(3) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company,
BCC, the Combined Company or any of their respective
subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the
Company, BCC, the Combined Company or any of their
respective subsidiaries or any of their respective
properties;
except, in the case of clauses (2) and (3) above, for any such
violation or default that, individually or in the aggregate,
could not reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Business.
(xvi) The combined historical financial statements
and schedules of Bresnan Communications Group Systems included
in the Final Memorandum present fairly in all material
respects the consolidated financial condition, results of
operations and cash flows of the Combined Company, as of the
dates and for the periods indicated, comply as to form with
the applicable accounting requirements of the Act and have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the
periods involved (except as otherwise noted therein or, in the
case of interim statements,
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normal year-end adjustments); the selected financial data set
forth under the caption "Selected Combined Financial and
Operating Data" in the Final Memorandum fairly present, on the
basis stated in the Final Memorandum, the information included
therein; the pro forma combined financial statements included
in the Final Memorandum include assumptions that provide a
reasonable basis for presenting the significant effects
directly attributable to the transactions and events described
therein, the related pro forma adjustments give appropriate
effect to those assumptions, and the pro forma adjustments
reflect the proper application of those adjustments to the
historical combined financial statement amounts in the pro
forma combined financial statements included in the Final
Memorandum; the pro forma combined financial statements
included in the Final Memorandum comply as to form in all
material respects with the applicable accounting requirements
of Regulation S-X under the Act; and the pro forma adjustments
have been properly applied to the historical combined amounts
in the compilation of those statements.
(xvii) Except as discussed in the Final Memorandum
(exclusive of any amendment or supplement thereto), there is
no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator
involving the Company, BCC, the Combined Company, any of their
respective subsidiaries or their respective property pending
or, to the knowledge of each of the Company and BCC,
threatened that:
(1) could reasonably be expected to have a
material adverse effect on the performance of this
Agreement, the Indenture, the Registration Rights
Agreement, the Escrow Agreement or the Contribution
Agreement or the consummation of any of the
transactions contemplated hereby or thereby; or
(2) could reasonably be expected to have a
material adverse effect on the condition (financial
or otherwise), prospects, earnings,
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business or properties of the Business, whether or
not arising from transactions in the ordinary course
of business.
(xviii) None of the Company, BCC, the Combined
Company or any subsidiary of the Company, BCC or the Combined
Company is in violation or default of:
(1) any provision of its charter or
certificate of formation, as the case may be, or
by-laws, limited partnership agreement or limited
liability company agreement, as the case may be;
(2) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition,
covenant or instrument to which it is a party or
bound or to which its property is subject; or
(3) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company,
BCC, the Combined Company or any of their respective
subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the
Company, BCC, the Combined Company or such subsidiary
or any of its properties, as applicable;
except, in the case of clauses (2) and (3) above, for any such
violation or default that, individually or in the aggregate,
could not reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Business.
(xix) KPMG LLP, who have certified certain combined
financial statements of Bresnan Communications Group Systems
and delivered their report with respect to the audited
combined financial statements included in the Final
Memorandum, are independent public accountants with respect to
BCCLP, TCI, the Company and BCC within the meaning of the Act
and the applicable published rules and regulations thereunder.
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(xx) The Company, BCC, the Combined Company and their
respective subsidiaries possess all licenses, certificates,
permits and other authorizations issued by the appropriate
federal, state, local or foreign regulatory authorities
necessary to conduct their respective businesses, except for
any failure to possess a license, certificate, permit or
authorization that, individually or in the aggregate, could
not reasonably be expected to have a material adverse effect
on the condition (financial or otherwise), prospects,
earnings, business or properties of the Business; and none of
the Company, BCC, the Combined Company or any such subsidiary
has received any notice of proceedings relating to the
revocation or modification of any such license, certificate,
authorization or permit which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling
or finding, would have a material adverse effect on the
condition (financial or otherwise), prospects, earnings,
business or properties of the Business, whether or not arising
from transactions in the ordinary course of business, except
as set forth in or contemplated in the Final Memorandum
(exclusive of any amendment or supplement thereto). Except as
previously disclosed to the Initial Purchasers, (A) the
Company, BCC, BCCLP and the TCI Systems Parties have applied
for and have received all licenses, certificates, permits and
other authorizations issued by the appropriate franchise
authorities necessary to transfer the franchises in connection
with the consummation of the TCI Transactions and (B) except
for any revocations or modifications that could not reasonably
be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Business or on the consummation of the TCI
Transactions, none of the Company, BCC, BCCLP or the TCI
Systems Parties has received any notice of proceedings
relating to the revocation or modification of any such
license, certificate, permit or authorization.
(xxi) The subsidiaries listed on Annex A attached
hereto are the only subsidiaries of the Company and BCC.
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(xxii) Each of the Company, BCC and the Combined
Company is in compliance with the Commission's staff legal
bulletin No.5 dated January 12, 1998, as amended to date,
related to Year 2000 compliance.
Any certificate signed by any officer of the Company or BCC
and delivered to the Representatives or counsel for the Initial Purchasers in
connection with the offering of the Securities shall be deemed a representation
and warranty by each of the Company and BCC as to matters covered thereby, to
each Initial Purchaser.
(b) BCCLP represents and warrants to each Initial Purchaser
that this Agreement and the Contribution Agreement have been duly
authorized, executed and delivered by BCCLP and the Escrow Agreement
has been duly authorized and, when executed and delivered by BCCLP, in
each case, assuming due authorization, execution and delivery by each
of the other parties thereto, constitutes or, upon such execution and
delivery by BCCLP, will constitute a legal, valid and binding
instrument enforceable, in each case, in accordance with its terms
(subject to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors' rights and remedies
generally from time to time in effect and to general principles of
equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether
considered in a proceeding in equity or at law).
2. Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, each of
the Company and BCC agrees to sell to each Initial Purchaser, and each Initial
Purchaser agrees, severally and not jointly, to purchase from the Company and
BCC, (i) at a purchase price of 97.500% of the principal amount thereof, plus
accrued interest, if any, from February 2, 1999, to the Closing Date, the
principal amount of Senior Notes and (ii) at a purchase price of 61.735% of the
principal amount at maturity thereof, plus accretion of original issue discount,
if any, from February 2, 1999, to the Closing Date, the principal amount at
maturity of Senior Discount Notes, in each case, as set forth opposite such
Initial Purchaser's name in Schedule I hereto.
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3. Delivery and Payment. Delivery of and payment for the
Securities shall be made at 10:00 A.M., New York City time, on February 2, 1999,
or at such time on such later date as the Representatives shall designate, which
date and time may be postponed by agreement between the Representatives and the
Company and BCC or as provided in Section 9 hereof (such date and time of
delivery and payment for the Securities being herein called the "Closing Date").
Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Initial Purchasers against payment by the
several Initial Purchasers through the Representatives of the purchase price
thereof to or upon the order of the Company by wire transfer payable in same-day
funds to the account specified by the Company. Delivery of the Securities shall
be made through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
4. Offering by Initial Purchasers. Each Initial Purchaser,
severally and not jointly, represents and warrants to and agrees with each of
the Company and BCC that:
(a) It has not offered or sold, and will not offer or sell,
any Securities except (i) to those it reasonably believes to be
qualified institutional buyers (as defined in Rule 144A under the Act)
and that, in connection with each such sale, it has taken or will take
reasonable steps to ensure that the purchaser of such Securities is
aware that such sale is being made in reliance on Rule 144A or (ii) in
accordance with the restrictions set forth in Exhibit A hereto.
(b) Neither it nor any person acting on its behalf has made or
will make offers or sales of the Securities in the United States by
means of any form of general solicitation or general advertising
(within the meaning of Regulation D) in the United States, except
pursuant to a registered public offering, whether an exchange offer or
shelf registration, as provided in the Registration Rights Agreement.
5. Agreements. Each of the Company and BCC agrees with each
Initial Purchaser that:
(a) The Company and BCC will furnish to each Initial
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Purchaser, without charge, during the period referred to in paragraph
(c) below, as many copies of the Final Memorandum and any amendments
and supplements thereto as it may reasonably request.
(b) Neither the Company nor BCC will amend or supplement the
Final Memorandum without the prior written consent of the
Representatives, which consent will not be unreasonably withheld.
(c) If at any time prior to the completion of the sale of the
Securities by the Initial Purchasers (as reasonably determined by the
Representatives), any event occurs as a result of which the Final
Memorandum, as then amended or supplemented, would include any untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it
should be necessary to amend or supplement the Final Memorandum to
comply with applicable law, the Company and BCC promptly (i) will
notify the Representatives of any such event; (ii) subject to the
requirements of paragraph (b) of this Section 5, will prepare an
amendment or supplement that will correct such statement or omission or
effect such compliance; and (iii) will supply any supplemented or
amended Final Memorandum to the several Initial Purchasers without
charge in such quantities as you may reasonably request.
(d) The Company and BCC will cooperate with the Initial
Purchasers in arranging, if necessary, for the qualification of the
Securities for sale by the Initial Purchasers under the laws of such
jurisdictions as the Initial Purchasers may designate and will maintain
such qualifications in effect so long as required for the sale of the
Securities; provided that neither the Company nor BCC shall be
obligated to (i) qualify to do business in any jurisdiction where it is
not now so qualified, (ii) or to take any action that would subject it
to service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not
now so subject or (iii) subject themselves to taxation in excess of a
nominal dollar amount in any such jurisdiction where they are not then
so subject. The Company and BCC will promptly advise the
Representatives of the receipt by
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the Company or BCC of any notification with respect to the suspension
of the qualification of the Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose.
(e) Neither the Company nor BCC will, nor will they permit any
of their respective Affiliates under their control to, resell any
Securities that have been acquired by any of them.
(f) None of the Company, BCC or any of their respective
Affiliates, or any person acting on their behalf will, directly or
indirectly, make offers or sales of any security, or solicit offers to
buy any security, under circumstances that would require the
registration of the Securities under the Act, except pursuant to a
registered public offering, whether an exchange offer or shelf
registration, as provided in the Registration Rights Agreement;
provided, however, actions of any Initial Purchaser or its Affiliates
other than at the direction of the Company or BCC shall not constitute
a breach of this covenant.
(g) None of the Company, BCC or any of their respective
Affiliates, or any person acting on its or their behalf will engage in
any form of general solicitation or general advertising (within the
meaning of Regulation D) in connection with any offer or sale of the
Securities in the United States; provided, however, actions of any
Initial Purchaser or its Affiliates other than at the direction of the
Company or BCC shall not constitute a breach of this covenant.
(h) So long as any of the Securities are "restricted
securities" within the meaning of Rule 144(a)(3) under the Act, the
Company and BCC will, unless they become subject to and complies with
Section 13 or 15(d) of the Exchange Act, provide to each holder of such
restricted securities and to each prospective purchaser (as designated
by such holder) of such restricted securities, upon the request of such
holder or prospective purchaser, any information required to be
provided by Rule 144A(d)(4) under the Act. This covenant is intended to
be for the benefit of the holders, and the prospective purchasers
designated by such holders, from time
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to time of such restricted securities.
(i) None of the Company, BCC or any of their respective
Affiliates, or any person acting on their behalf will engage in any
directed selling efforts with respect to the Securities, and each of
them will comply with the offering restrictions requirement of
Regulation S; provided, however, actions of any Initial Purchaser or
its Affiliates other than at the direction of the Company or BCC shall
not constitute a breach of this covenant. Terms used in this paragraph
have the meanings given to them by Regulation S.
(j) The Company and BCC will cooperate with the
Representatives and use their respective commercially reasonable
efforts to permit the Securities to be eligible for clearance and
settlement through The Depository Trust Company.
(k) Each of the Company, BCC and BCCLP will not, without the
prior written consent of Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell,
contract to sell, or otherwise dispose of (or enter into any
transaction which is designed to, or might reasonably be expected to,
result in the disposition (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) by the
Company, BCC or BCCLP or any Affiliate of the Company, BCC or BCCLP or
any person in privity with the Company, BCC, BCCLP or any Affiliate of
the Company, BCC or BCCLP) directly or indirectly, or announce the
offering of, or file a registration statement for, any debt securities
issued or guaranteed by the Company, BCC or BCCLP (other than (i) the
Securities, (ii) pursuant to a registered public offering as provided
in the Registration Rights Agreement, (3) the New Credit Facility and
(iv) pursuant to a private placement of debt securities to a maximum of
three purchasers other than under Rule 144A, provided that such
purchasers must be restricted from reselling such debt securities until
the end of the period referenced herein during which the Company, BCC
and BCCLP are restricted from offering debt securities) for the period
ending on the earlier of the date that (A) occurs 120 days following
the Execution Time and, if applicable, (B) all the Securities are
redeemed pursuant to the Special Mandatory Redemption.
(l) Neither the Company nor BCC will take, directly or
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indirectly, any action prohibited by Regulation M under the Exchange
Act in connection with the offering of the Securities.
(m) The Company and BCC agree to pay all costs and expenses
relating to the Offering that are customarily borne by an issuer in an
underwritten offering of securities (subject to the provisions of any
letters that have been entered into between BCCLP and the Initial
Purchasers which may relate to costs and expenses related to this
Offering).
(n) The Company and BCC will apply the net proceeds from the
sale of the Securities substantially in accordance with their
statements under the caption "Use of Proceeds" in the Final Memorandum.
(o) The Company, BCC and BCCLP will comply with the terms of
the Escrow Agreement.
6. Conditions to the Obligations of the Initial Purchasers.
The obligations of the Initial Purchasers to purchase the Securities shall be
subject to the accuracy of the representations and warranties on the part of
each of the Company, BCC and BCCLP contained herein at the Execution Time and
the Closing Date, to the accuracy of the statements of each of the Company and
BCC made in any certificates pursuant to the provisions hereof, to the
performance by each of the Company, BCC and BCCLP of its obligations hereunder
and to the following additional conditions:
(a) The Company shall have requested and caused Xxxx,
Xxxxxxxx, Xxxxxxxx & Xxxxxx LLP, counsel for each of the Company and
BCC, to furnish to the Representatives its opinion, dated the Closing
Date and addressed to the Representatives, to the effect that:
(i) each of the Company, BCC, BCCLP and their
respective subsidiaries, including BTC (individually, a
"Subsidiary" and collectively, the "Subsidiaries"), has been
duly formed or incorporated, as applicable, and is validly
existing as a limited liability company, limited partnership
or corporation, as applicable, in good standing under the laws
of the jurisdiction in which it is chartered or organized,
with requisite
18
corporate, limited liability company or limited partnership
power, as applicable, and authority to own or lease, as the
case may be, and to operate its properties and conduct its
business as described in the Final Memorandum, and is duly
qualified to do business as a foreign entity and is in good
standing under the laws of the jurisdictions referenced in
such opinion, other than such jurisdictions where the failure
to so qualify, individually or in the aggregate, could not
reasonably be expected to have a material adverse effect on
the condition (financial or otherwise), earnings, business or
properties of the Business;
(ii) all the outstanding equity interests of the
Company, BCC, BCCLP and each of their respective Subsidiaries
have been duly and validly authorized and issued and, to the
extent applicable, are fully paid and nonassessable, and,
except as otherwise set forth in the Final Memorandum, all
outstanding equity interests of BCC and each of the
Subsidiaries of the Company are owned of record by the
Company, either directly or through wholly owned subsidiaries,
to the knowledge of such counsel, after due inquiry, free and
clear of any security interests, claims, liens or
encumbrances;
(iii) BCCLP owns of record all the outstanding
equity interests of the Company;
(iv) the Indenture has been duly authorized, executed
and delivered by the Company and BCC, and constitutes a legal,
valid and binding instrument enforceable against each of the
Company and BCC in accordance with its terms (subject to
applicable bankruptcy, reorganization, insolvency, moratorium
or other laws affecting creditors' rights and remedies
generally from time to time in effect and to general
principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing,
regardless of whether considered in a proceeding in equity or
at law); the Securities have been duly and validly authorized
and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by
the Initial Purchasers pursuant to this Agreement, will
constitute
19
legal, valid and binding obligations of each of the Company
and BCC entitled to the benefits of the Indenture and
enforceable in accordance with its terms (subject to
applicable bankruptcy, reorganization, insolvency, moratorium
or other laws affecting creditors' rights and remedies
generally from time to time in effect and to general
principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing,
regardless of whether considered in a proceeding in equity or
at law); the Escrow Agreement has been duly authorized, and
when executed and delivered by each of the Company and BCC,
will constitute a legal, valid and binding instrument
enforceable against each of the Company and BCC in accordance
with its terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
creditors' rights and remedies generally from time to time in
effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether considered in a
proceeding in equity or at law); and the statements set forth
under the heading "Description of Notes" and "Exchange Offer;
Registration Rights" in the Final Memorandum, insofar as such
statements purport to summarize certain provisions of the
Securities, the Indenture, the Registration Rights Agreement
and the Escrow Agreement, provide a fair summary of such
provisions;
(v) to the knowledge of such counsel, there is no
pending or threatened action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Company, BCC, BCCLP or any of their
respective subsidiaries or properties that is not adequately
disclosed in the Final Memorandum, except in each case for
such proceedings that, if the subject of an unfavorable
decision, ruling or finding would not singly or in the
aggregate, result in a material adverse change in the
condition (financial or otherwise), earnings, business or
properties of the Business; and the statements in the Final
Memorandum under the headings "Certain Federal Tax
Considerations," "Legislation and
20
Regulation," "Business--Legal Proceedings," and "Exchange
Offer; Registration Rights," to the extent such statements
constitute matters of law, summaries of legal matters or legal
conclusions have been reviewed by such counsel and are correct
in all material respects;
(vi) based solely upon an officer's certificate from
BCCLP, which in turn is based solely upon an officer's
certificate from the TCI Systems Parties regarding the
accuracy of the representations and warranties with respect to
factual matters made by the TCI Systems Parties in the
Contribution Agreement to the other parties thereto and upon
the actual knowledge of attorneys in such counsel's firm who
participated in due diligence discussions relating to the
negotiation of the Contribution Agreement on behalf of BCCLP,
such counsel has not become aware that there is any pending or
threatened action, suit, or proceeding by or before any court
or governmental agency, authority or body or any arbitrator
involving the TCI Systems Parties or any of the Contributed
TCI Systems that is not adequately disclosed in the Final
Memorandum, except in each case for such proceedings that, if
the subject of an unfavorable decision, ruling or finding
would not individually or in the aggregate, result in a
material adverse change in the condition (financial or
otherwise), earnings, business or properties of the Business;
(vii) this Agreement and the Registration Rights
Agreement have been duly authorized, executed and delivered by
each of the Company and BCC;
(viii) no consent, approval, authorization, filing
with or order of any court or governmental agency or body is
required in connection with the transactions contemplated
herein or in the Indenture, the Registration Rights Agreement
and the Escrow Agreement, except such as will be obtained
under the Act and the Trust Indenture Act, such as may be
required under the blue sky or securities laws of any
jurisdiction in connection with the transactions contemplated
by the Registration Rights Agreement, such
21
as may be required under such blue sky laws in connection with
the purchase and sale of the Securities by the Initial
Purchasers in the manner contemplated in this Agreement and
the Final Memorandum, such other approvals (specified in such
opinion) as have been obtained;
(ix) based solely upon an officer's certificate from
BCCLP, which in turn is based solely upon an officer's
certificate from the TCI Systems Parties regarding the
accuracy of the representations and warranties with respect to
factual matters made by the TCI Systems Parties in the
Contribution Agreement to the other parties thereto and upon
the actual knowledge of attorneys in such counsel's firm who
participated in due diligence discussions relating to the
negotiation of the Contribution Agreement on behalf of BCCLP,
such counsel has not become aware that there is any consent,
approval, authorization, filing with or order of any court or
governmental agency or body that is required in connection
with the consummation of the TCI Transactions other than those
that have been obtained or if not obtained could not,
individually or in the aggregate, reasonably be expected to
have a material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the Business;
(x) the execution and delivery of the Indenture, this
Agreement, the Registration Rights Agreement, the Escrow
Agreement and the Contribution Agreement, the issue and sale
of the Securities, the consummation of any other of the
transactions herein or therein contemplated and the
fulfillment of the terms hereof or thereof will not conflict
with, result in a breach or violation of, or imposition of any
lien, charge or encumbrance upon any property or asset of the
Company, BCC, BCCLP or their respective subsidiaries pursuant
to, (i) the charter or certificate of formation, as the case
may be, or by-laws, limited partnership agreement or limited
liability company agreement, as the case may be, of the
Company, BCC, BCCLP or their respective subsidiaries; (ii) the
terms of any agreement listed on Annex 1 to this opinion; or
(iii) any statute, law, rule, regulation, judgment, order or
decree known to
22
such counsel to be applicable to the Company, BCC, BCCLP or
any of their respective subsidiaries of any court, regulatory
body, administrative agency, governmental body, arbitrator or
other authority having jurisdiction over the Company, BCC,
BCCLP, any of their respective subsidiaries or any of their
respective properties, except, in the case of clauses (iii)
above, for any such conflict, breach, violation or default
that, individually or in the aggregate, could not reasonably
be expected to have a material adverse effect on the condition
(financial or otherwise), earnings, business or properties of
the Business;
(xi) based solely upon an officer's certificate from
BCCLP, which in turn is based solely upon an officer's
certificate from the TCI Systems Parties regarding the
accuracy of the representations and warranties with respect to
factual matters made by the TCI Systems Parties in the
Contribution Agreement to the other parties thereto and upon
the actual knowledge of attorneys in such counsel's firm who
participated in due diligence discussions relating to the
negotiation of the Contribution Agreement on behalf of BCCLP,
such counsel have not become aware that the execution and
delivery of the Indenture, this Agreement, the Registration
Rights Agreement, the Escrow Agreement and the Contribution
Agreement, the issue and sale of the Securities, the
consummation of any other of the transactions herein or
therein contemplated and the fulfillment of the terms hereof
or thereof will not conflict with, result in a breach or
violation of, or imposition of any lien, charge or encumbrance
upon any of the properties or assets of the Contributed TCI
Systems pursuant to any statute, law, rule, regulation,
judgment, order or decree known to such counsel to be
applicable to the Contributed TCI Systems except for any such
conflict, breach, violation or default that, individually or
in the aggregate, could not reasonably be expected to have a
material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the Business;
(xii) assuming the accuracy of the representations
and warranties and compliance with the agreements contained
herein, no registration of the
23
Securities under the Act, and no qualification of an indenture
under the Trust Indenture Act, are required for the offer and
sale by the Initial Purchasers of the Securities in the manner
contemplated by this Agreement; and
(xiii) neither the Company nor BCC is and, after
giving effect to the offering and sale of the Securities and
the application of the proceeds thereof as described in the
Final Memorandum, will be an "investment company" as defined
in the Investment Company Act without taking account of any
exemption arising out of the number of holders of the
Company's or BCC's securities, respectively.
For the purposes of opinions (v) and (x) above, the
properties of the Company, BCC, BCCLP and their respective subsidiaries
do not include the Contributed TCI Systems. In the event that the TCI
Transactions are not consummated prior to or simultaneously with the
Closing, such counsel will not deliver opinion (ix).
In addition, such counsel's opinion should state that
in connection with the preparation of the Final Memorandum, such
counsel has participated in various discussions and meetings with the
Initial Purchasers, their representatives, officers and other
representatives of the Company and BCC and representatives of the
Company's independent public accountants and such counsel has also
examined certain other documents furnished to them by the Company as
such counsel has deemed necessary and relevant for purposes of the
following. During the course of the above-described procedures, subject
to the last two sentences of this paragraph, nothing came to such
counsel's attention that led them to believe that the Final Memorandum,
as of its date or the Closing Date, contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The limitations inherent in the independent verification of
factual matters and the character of determinations involved in the
preparation of the Final Memorandum are such, however, that such
counsel does not
24
assume any responsibility for the accuracy, completeness or fairness of
the statements contained in the Final Memorandum (except to the extent
stated in paragraph (v) hereof). Such statement shall also provide that
such counsel need express no view with respect to the financial
statements, the notes thereto and other information of an accounting,
financial or statistical nature in the Final Memorandum.
In rendering such opinion, such counsel may rely (A)
as to matters involving the application of laws of any jurisdiction
other than the State of Delaware, the State of New York or the Federal
laws of the United States, to the extent they deem proper and specified
in such opinion, upon the opinion of other counsel of good standing
whom they believe to be reliable and who are reasonably satisfactory to
counsel for the Initial Purchasers; and (B) as to matters of fact, to
the extent they deem proper, on certificates of responsible officers of
the Company, BCC and public officials. References to the Final
Memorandum in this Section 6(a) include any amendment or supplement
thereto at the Closing Date.
(b) The Company shall have requested and caused Xxxxxx
Xxxxxxx, Vice President and General Counsel for each of the Company and
BCC, to furnish to the Representatives his opinion, dated the Closing
Date and addressed to the Representatives, to the effect that:
(i) to the knowledge of such counsel, there is no
pending or threatened action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Company, BCC, BCCLP or any of their
respective subsidiaries or properties that is not adequately
disclosed in the Final Memorandum, except in each case for
such proceedings that, if the subject of an unfavorable
decision, ruling or finding would not singly or in the
aggregate, result in a material adverse change in the
condition (financial or otherwise), earnings, business or
properties of the Business; and
(ii) the execution and delivery of the Indenture,
this Agreement, the Registration Rights Agreement, the Escrow
Agreement and the Contribution Agreement, the issue and sale
of the Securities, the consummation of
25
any other of the transactions herein or therein contemplated
and the fulfillment of the terms hereof or thereof will not
conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any
property or asset of the Company, BCC, BCCLP or their
respective subsidiaries pursuant to the terms of any
indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which the Company, BCC,
BCCLP or any of their respective subsidiaries is a party or
bound or to which its respective property is subject except
for any such conflict, breach, violation or default that,
individually or in the aggregate, could not reasonably be
expected to have a material adverse effect on the condition
(financial or otherwise), earnings, business or properties of
the Business.
For the purposes of opinions (i) and (ii) above, the
properties of the Company, BCC, BCCLP and their respective subsidiaries
do not include the Contributed TCI Systems.
In addition, such counsel's opinion should state that
subject to the last sentence of this paragraph, nothing came to such
counsel's attention that led him to believe that the Final Memorandum,
as of its date or the Closing Date, contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Such statement shall also provide that such counsel need
express no view with respect to the financial statements, the notes
thereto and other information of an accounting, financial or
statistical nature in the Final Memorandum.
(c) BCCLP shall have requested and caused Xxxx, Xxxxxxxx,
Xxxxxxxx & Xxxxxx LLP, counsel for BCCLP, to furnish to the
Representatives its opinion, dated the Closing Date and addressed to
the Representatives, to the effect that this Agreement, the
Registration Rights Agreement, the Escrow Agreement and the
Contribution Agreement have been duly authorized, executed and
delivered by BCCLP and each constitutes a legal, valid and binding
26
instrument enforceable against BCCLP in accordance with its terms
(subject to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors' rights and remedies
generally from time to time in effect and to general principles of
equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether
considered in a proceeding in equity or at law); and that the
execution, delivery and performance of the Partnership Agreement by BCI
(USA), LLC has been duly authorized and, when executed and delivered by
Bresnan Communications, Inc. on behalf of BCI (USA), LLC, as general
partner of BCCLP, assuming due authorization, execution and delivery
thereof by the other parties thereto, will constitute a legal, valid
and binding instrument enforceable against BCI (USA), LLC, as general
partner of BCCLP, in accordance with its terms (subject to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws
affecting creditors' rights and remedies generally from time to time in
effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and
fair dealing, regardless of whether considered in a proceeding in
equity or at law).
(d) The Company and BCC shall have requested and caused Xxxx,
Xxxxxx & Xxxxxxxxx, regulatory counsel for the Company and BCC, to
furnish to the Representatives its opinion, dated the Closing Date and
addressed to the Representatives, to the effect that:
(i) the statements regarding communications
regulatory matters in the Final Memorandum under the headings
"Legislation and Regulation," "Business-- Competition," "Risk
Factors--Risks Associated with Competition," "Risk
Factors--Risks Associated with Offering Telecommunications
Services," "Risk Factors-- Risks Associated with Regulation of
the Cable Television Industry" and "Risk Factors--Franchises"
fairly summarize the matters therein described;
(ii) to the knowledge of such counsel, based on
information provided to such counsel regarding existing
operations, the Company, BCC, the Combined Company and their
respective subsidiaries possess all licenses,
27
certificates, permits and other authorizations issued by the
Federal Communications Commission ("FCC") necessary to conduct
their respective businesses, and none of the Company, BCC, the
Combined Company or any such subsidiary has received any
notice of proceedings relating to the revocation or
modification of any such license, certificate, authorization
or permit which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would have a
material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Business, whether or not arising from trans actions in the
ordinary course of business, except as set forth in or
contemplated in the Final Memorandum (exclusive of any
amendment or supplement thereto);
(iii) the Company and the Combined Company have
applied for and have received all approvals from the FCC
necessary to consummate the TCI Transactions and neither the
Company nor the Combined Company has received any notice of
proceedings relating to the revocation or modification of any
such license, in each case, except as previously disclosed to
the Initial Purchasers;
(iv) to the knowledge of such counsel, there is no
pending or threatened action, suit or proceeding by or before
the FCC against the Company, BCC, the Combined Company or any
of their respective subsidiaries or properties that is not
adequately disclosed in the Final Memorandum, except in each
case for such proceedings that, if the subject of an
unfavorable decision, ruling or finding would not singly or in
the aggregate, result in a material adverse change in the
condition (financial or otherwise), prospects, earnings,
business or properties of the Business;
(v) no consent, approval, authorization, filing with
or order of the FCC is required under the Communications Act
of 1934, as amended (the "Communications Act"), in connection
with the transactions contemplated herein or in the Indenture,
the Registration Rights Agreement, the Escrow Agreement and
the Contribution Agreement, except such as have
28
been obtained; and
(vi) the execution and delivery of the Indenture,
this Agreement, the Registration Rights Agreement and the
Escrow Agreement, the issue and sale of the Securities, the
consummation of any other of the transactions herein or
therein contemplated and the fulfillment of the terms hereof
or thereof will not conflict with, result in a breach or
violation of the Communications Act or any FCC regulation in
effect or cause the suspension, revocation, impairment,
forfeiture, nonrenewal or termination of any FCC license or
other authorization of the FCC. To the extent that any
agreement or other document purports to grant a security
interest in licenses issued by the FCC, the FCC has taken the
position that security interests in FCC licenses are not
valid. To the extent that any party seeks to exercise control
of an FCC license in the event of a default or for any other
reason, it may be necessary to obtain prior FCC consent.
(e) The Representatives shall have received from Cravath,
Swaine & Xxxxx, counsel for the Initial Purchasers, such opinion or
opinions, dated the Closing Date and addressed to the Representatives,
with respect to the issuance and sale of the Securities, the Indenture,
the Registration Rights Agreement, the Final Memorandum (as amended or
supplemented at the Closing Date) and other related matters as the
Representatives may reasonably require, and each of the Company, BCC
and BCCLP shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon such
matters.
(f) To the extent the Funding Conditions have not been
satisfied on or prior to the Closing Date, the Escrow Agreement shall
have been executed by each of the parties thereto and the Company and
BCC shall have deposited with the Escrow Agent the Escrowed Funds in an
aggregate amount sufficient to pay the aggregate Mandatory Redemption
Price assuming the Special Mandatory Redemption takes place on May 14,
1999.
(g) To the extent the Funding Conditions have not been
29
satisfied on or prior to the Closing Date, the Company and BCC shall
have requested and caused KPMG LLP, to furnish to the Representatives,
the Trustee and the Escrow Agent its opinion, dated the Closing Date
and addressed to the Escrow Agent, to the effect that the Escrowed
Funds are sufficient to redeem the Securities in accordance with the
procedures set forth in the Escrow Agreement for the Special Mandatory
Redemption assuming the Special Mandatory Redemption takes place on May
14, 1999.
(h) Each of the Company and BCC shall have furnished to the
Representatives a certificate of the Company and BCC, as applicable,
signed by the President and Chief Executive Officer and the principal
financial or accounting officer of the Company and BCC, as applicable,
dated the Closing Date, to the effect that the signers of such
certificate have carefully examined the Final Memorandum, any amendment
or supplement to the Final Memorandum and this Agreement and that:
(i) the representations and warranties of the Company
and BCC, as applicable, in this Agreement are true and correct
in all material respects on and as of the Closing Date with
the same effect as if made on the Closing Date, and the
Company and BCC, as applicable, have complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied hereunder at or prior to the Closing
Date; and
(ii) since the date of the most recent financial
statements included in the Final Memorandum (exclusive of any
amendment or supplement thereto), there has been no material
adverse change in the condition (financial or otherwise),
prospects, earnings, business or properties of the Business,
whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated by
the Final Memorandum (exclusive of any amendment or supplement
thereto).
(i) At the Execution Time and at the Closing Date, the Company
shall have requested and caused KPMG LLP to furnish to the
Representatives letters, dated respectively as of the Execution Time
and as of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants
within the meaning of
30
rule 101 of the AIPCA's Code of Professional Conduct and its
interpretations and rulings, that they have performed a review of the
unaudited interim combined financial information of Bresnan
Communications Group Systems for the nine-month period ended September
30, 1998, and as at September 30, 1998, and stating in effect that:
(i) their audit of the audited combined financial
statements included in the Final Memorandum and reported on by
them comprised audit tests and procedures deemed necessary for
the purpose of expressing an opinion on such financial
statements, taken as a whole;
(ii) on the basis of a reading of the latest
unaudited combined financial statements made available by
BCCLP and TCI; their limited review in accordance with the
standards established under Statement on Auditing Standards
No. 71, of the unaudited interim financial information for the
nine-month period ended September 30, 1998, and as at
September 30, 1998; carrying out certain specified procedures
(but not an examination in accordance with generally accepted
auditing standards) which would not necessarily reveal matters
of significance with respect to the comments set forth in such
letter; a reading of the minutes of the meetings of the
stockholders, directors and executive, finance, and audit
committees of each of BCCLP and TCI; and inquiries of certain
officials of the BCCLP, TCI Communications, Inc., and the TCI
Systems Parties, who have responsibility for financial
and accounting matters of each of such entities and their
respective subsidiaries as to transactions and events
subsequent to December 31, 1997, nothing came to their
attention which caused them to believe that:
(1) any unaudited financial statements
included in the Final Memorandum are not stated on a
basis substantially consistent with that of the
audited combined financial statements included
in the Offering Memorandum; and said unaudited
financial statements are not in conformity with
generally accepted accounting principles applied on a
basis substantially consistent with that of the
audited combined financial statements included
31
in the Final Memorandum; or
(2) with respect to the period subsequent
to September 30, 1998, there were any increases, at a
specified date not more than five days prior to the
date of the letter, in the debt of Bresnan
Communications Group Systems greater than $10,000,000
as compared with the amounts shown on the September
30, 1998, combined balance sheet included in the
Final Memorandum, or for the period from October 1,
1998, to such specified date there were any
decreases, as compared with the corresponding period
in the preceding year, in revenue, or EBITDA and net
earnings, except in all instances for changes or
decreases set forth in such letter, in which case the
letter shall be accompanied by an explanation by the
Company as to the significance thereof unless said
explanation is not deemed necessary by the
Representatives;
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
(which is limited to accounting, financial or statistical
information derived from the general accounting records of the
Company and its subsidiaries) set forth in the Final
Memorandum, including the information set forth under the
captions "Offering Memorandum Summary," "Risk Factors," "Use
of Proceeds," "Capitalization," "Selected Combined Financial
and Operating Data," "Unaudited Pro Forma Combined Financial
Data," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Business" and "Certain
Relationships and Related Transactions," agrees with the
accounting records of BCCLP and TCI, excluding any questions
of legal interpretation; and
(iv) on the basis of a reading of the unaudited pro
forma financial statements (the "pro forma combined financial
statements") included in the Final Memorandum; carrying out
certain specified procedures; inquiries of certain officials
of BCCLP, TCI Communications, Inc. and the TCI Systems Parties
who
32
have responsibility for financial and accounting matters; and
proving the arithmetic accuracy of the application of the pro
forma adjustments to the historical combined amounts in the
pro forma combined financial statements, nothing came to their
attention which caused them to believe that the pro forma
combined financial statements do not comply in form in all
material respects with the applicable accounting requirements
of Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical
amounts in the compilation of such statements.
References to the Final Memorandum in this Section 6(i)
include any amendment or supplement thereto at the date of the
applicable letter.
(j) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Final Memorandum (exclusive of
any amendment or supplement thereto), there shall not have been:
(i) any change or decrease specified in the letter
or letters referred to in paragraph (i) of this
Section 6; or
(ii) any change, or any development involving a
prospective change, in or affecting the condition (financial
or otherwise), prospects, earnings, business or properties of
the Business, whether or not arising from transactions in the
ordinary course of business, except as set forth in or
contemplated in the Final Memorandum (exclusive of any
amendment or supplement thereto) the effect of which, in any
case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to
make it impractical or inadvisable to market the Securities as
contemplated by the Final Memorandum (exclusive of any
amendment or supplement thereto).
(k) The Securities shall have been designated as
Portal-eligible securities in accordance with the rules and regulations
of the NASD, and the Securities shall be eligible for clearance and
settlement through The Depository Trust Company.
33
(l) Subsequent to the Execution Time, there shall not have
been any decrease in the rating of any of the Company's or BCC's debt
securities by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act) or
any notice given of any intended or potential decrease in any such
rating or of a possible change in any such rating that does not
indicate the direction of the possible change.
(m) Prior to the Closing Date, the Company and BCC shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and counsel for the
Initial Purchasers, this Agreement and all obligations of the Initial Purchasers
hereunder may be canceled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancelation shall be given to the Company and
BCC in writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 will
be delivered at the office of counsel for the Company, at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, on the Closing Date.
7. Reimbursement of Expenses. If the sale of the Securities
provided for herein is not consummated because any condition to the obligations
of the Initial Purchasers set forth in Section 6 hereof is not satisfied or
because of any refusal, inability or failure on the part of the Company, BCC or
BCCLP, to perform any agreement herein or comply with any provision hereof other
than by reason of a default by any of the Initial Purchasers, the Company and
BCC will reimburse the Initial Purchasers severally through Xxxxxxx Xxxxx Xxxxxx
on demand for all reasonable out-of-pocket expenses (including reasonable fees
and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of the Securities.
34
8. Indemnification and Contribution. (a) Each of the Company,
BCC and, subject to paragraph (e) of this Section 8, BCCLP, agrees to indemnify
and hold harmless each Initial Purchaser, the directors, officers, employees and
agents of each Initial Purchaser and each person who controls any Initial
Purchaser within the meaning of either Section 15 of the Act or Section 20 of
the Exchange Act against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject under the Act,
the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Memorandum, the Final Memorandum (or in any supplement or amendment
thereto) or any information provided by the Company or BCC to any holder or
prospective purchaser of Securities pursuant to Section 5(h), or in any
amendment thereof or received by it 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, in
the light of the circumstances under which they were made, not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that (i) none of the Company, BCC or BCCLP will be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made in the Preliminary Memorandum or the Final Memorandum, or
in any amendment thereof or supplement thereto, in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
any Initial Purchasers through the Representatives specifically for inclusion
therein and (ii) that with respect to any untrue statement or omission of a
material fact made in any Preliminary Memorandum, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any Initial
Purchaser from whom the person asserting any such loss, claim, damage or
liability purchased the Securities concerned in any initial resale of the
Securities by the Initial Purchaser, to the extent that any such loss, claim,
damage or liability of such Purchaser occurs under the circumstances where it
shall have been determined by a court of competent jurisdiction by final and
35
nonappealable judgment that (A) the untrue statement or omission of a material
fact contained in the Preliminary Memorandum was corrected in the Final
Memorandum, (B) the Company and/or BCC had previously furnished copies of the
Final Memorandum to the Initial Purchasers and (C) such loss, claim, damage or
liability results from the fact that there was not sent or given to such person
at or prior to the written confirmation of the sale of such Securities to such
person, a copy of the Final Memorandum. This indemnity agreement will be in
addition to any liability which the Company, BCC or BCCLP may otherwise have.
(b) Each Initial Purchaser severally and not jointly agrees to
indemnify and hold harmless each of the Company, BCC and BCCLP, each of their
respective directors and officers, and each other person, if any, who controls
each of the Company, BCC or BCCLP, within the meaning of either Section 15 of
the Act or Section 20 of the Exchange Act, to the same extent as the foregoing
indemnity from the Company, BCC and BCCLP to each Initial Purchaser, but only
with reference to written information relating to such Initial Purchaser
furnished to the Company by or on behalf of such Initial Purchaser through the
Representatives specifically for inclusion in the Preliminary Memorandum or the
Final Memorandum (or in any amendment or supplement thereto). This indemnity
agreement will be in addition to any liability which any Initial Purchaser may
otherwise have. Each of the Company, BCC and BCCLP acknowledges that the
statements set forth in the last paragraph of the cover page regarding delivery
of the Securities and, under the heading "Plan of Distribution", (i) the list of
Initial Purchasers and their respective participation in the sale of the
Securities; (ii) the sentences related to concessions and reallowances; and
(iii) the paragraph related to stabilization, syndicate covering transactions
and penalty bids in the Preliminary Memorandum and the Final Memorandum,
constitute the only information furnished in writing by or on behalf of the
Initial Purchasers for inclusion in the Preliminary Memorandum or the Final
Memorandum (or in any amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party
36
(i) will not relieve it from liability under paragraph (a) or (b) above unless
and to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses; and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ one separate counsel (in addition to one local
counsel in each jurisdiction), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the use of
counsel chosen by the indemnifying party to represent the indemnified party
would present such counsel with a conflict of interest; (ii) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party; (iii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of the institution
of such action; or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.
37
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company, BCC and, subject to paragraph (e)
of this Section 8, BCCLP and the Initial Purchasers agree to contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or defending same)
(collectively "Losses") to which the Company, BCC and BCCLP and one or more of
the Initial Purchasers may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company, BCC and BCCLP on the one
hand and by the Initial Purchasers on the other from the offering of the
Securities; provided, however, that in no case shall any Initial Purchaser
(except as may be provided in any agreement among the Initial Purchasers
relating to the offering of the Securities) be responsible for any amount in
excess of the purchase discount or commission applicable to the Securities
purchased by such Initial Purchaser hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company, BCC
and, subject to paragraph (e) of this Section 8, BCCLP and the Initial
Purchasers shall contribute in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company, BCC and
BCCLP on the one hand and of the Initial Purchasers on the other in connection
with the statements or omissions which resulted in such Losses, as well as any
other relevant equitable considerations. Benefits received by the Company, BCC
and BCCLP, shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by the Company, and benefits
received by the Initial Purchasers shall be deemed to be equal to the total
purchase discounts and commissions in each case set forth on the cover of the
Final Memorandum. Relative fault shall be determined by reference to, among
other things, whether any untrue or any alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information provided by the Company, BCC and BCCLP on the one hand or the
Initial Purchasers on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company, BCC and BCCLP and the Initial
Purchasers agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any
38
other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), 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. For purposes of
this Section 8, each person who controls an Initial Purchaser within the meaning
of either the Act or the Exchange Act and each director, officer, employee and
agent of an Initial Purchaser shall have the same rights to contribution as such
Initial Purchaser, and each person who controls the Company, BCC and BCCLP
within the meaning of either Section 15 of the Act or Section 20 of the Exchange
Act and each officer and director of the Company, BCC and BCCLP shall have the
same rights to contribution as the Company, BCC and BCCLP subject in each case
to the applicable terms and conditions of this paragraph (d).
(e) The indemnification and contribution provided by BCCLP
pursuant to this Section 8 will be effective if the Funding Conditions are not
satisfied on or prior to Closing and until the earlier of Funding Date or the
Mandatory Redemption Date (each as defined in the Escrow Agreement). For all
periods on and after the Funding Date or the Mandatory Redemption Date, as
applicable, each of the Initial Purchasers agree and acknowledge that BCCLP will
be released from all its obligations under this Section 8.
9. Default by an Initial Purchaser. If any one or more Initial
Purchasers shall fail to purchase and pay for any of the Securities agreed to be
purchased by such Initial Purchaser hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Initial Purchasers shall be obligated severally to take
up and pay for (in the respective proportions which the principal amount of
Senior Notes or principal amount at maturity of Senior Discount Notes, as
applicable, set forth opposite their names in Schedule I hereto bears to the
aggregate principal amount of Senior Notes or aggregate principal amount at
maturity of Senior Discount Notes, as applicable, set forth opposite the names
of all the remaining Initial Purchasers) the Securities which the defaulting
Initial Purchaser or Initial Purchasers agreed but failed to purchase; provided,
however, that in the event that the aggregate principal amount of Senior Notes
or aggregate principal amount at maturity of Senior Discount Notes, as
applicable, which the defaulting Initial Purchaser or Initial Purchasers agreed
but failed to purchase shall exceed 10%
39
of the aggregate principal amount of Senior Notes or aggregate principal amount
at maturity of Senior Discount Notes, as applicable, set forth in Schedule I
hereto, the remaining Initial Purchasers shall have the right to purchase all,
but shall not be under any obligation to purchase any, of the Securities, and if
such nondefaulting Initial Purchasers do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Initial
Purchaser or the Company or BCC. In the event of a default by any Initial
Purchaser as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding five Business Days, as the Representatives shall
determine in order that the required changes in the Final Memorandum or in any
other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Initial Purchaser of its liability, if
any, to the Company or BCC or any nondefaulting Initial Purchaser for damages
occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to
termination in the absolute discretion of the Representatives, by notice given
to the Company and BCC prior to delivery of and payment for the Securities, if
at any time prior to such time (i) trading in securities generally on the New
York Stock Exchange shall have been suspended or limited or minimum prices shall
have been established on such Exchange; (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities; or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war or other calamity or crisis the
effect of which on financial markets is such as to make it, in the sole judgment
of the Representatives, impracticable or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Final Memorandum
(exclusive of any amendment or supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities (subject to Section 8(e))
and other statements of the Company, BCC and BCCLP or their respective officers
and of the Initial Purchasers set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by or
on behalf of the Initial Purchasers or the Company, BCC and BCCLP or any of the
officers, directors, employees, agents or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Securities.
The
40
provisions of Sections 7 and 8 hereof shall survive the termination or
cancelation of this Agreement.
12. Joint and Several Obligations. All representations,
warranties, agreements and other obligations or statements of the Company, BCC
and, subject to Section 8(e) hereof, BCCLP are the joint and several
representations, warranties, agreements, obligations and statements of the
Company and BCC and, with respect to Section 8 hereof, BCCLP.
13. Notices. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to the Xxxxxxx Xxxxx Xxxxxx Inc. General Counsel
(fax no.: (000) 000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx
Xxxxxx Inc. at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: General
Counsel; or, if sent to the Company, BCC and BCCLP will be mailed, delivered or
telefaxed and confirmed to it at, 000 Xxxxxxxxxxx Xxxxxx, Xxxxx Xxxxxx, Xxx Xxxx
00000, Attention: Xxxxxxx X. XxXxxx (fax no.: (000) 000-0000), with a copy to
Xxxx, Xxxxxxxx, Xxxxxxxx & Xxxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, xxxxxxxxx: Xxxxx Xxxxxx, Esq. (fax no.: (000) 000-0000)
14. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and, except as expressly set forth in Section 5(h) hereof, no
other person will have any right or obligation hereunder.
15. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
16. Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall constitute an original and all of
which together shall constitute one and the same instrument.
17. Headings. The section headings used herein are
for convenience only and shall not affect the construction hereof.
41
18. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Affiliate" shall have the meaning specified in Rule
501(b) of Regulation D.
"BCCLP" shall mean Bresnan Communications Company Limited
Partnership, a Michigan limited partnership.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in The City of New York.
"Commission" shall mean the Securities and Exchange
Commission.
"Contribution Agreement" shall mean the Contribution Agreement
dated June 3, 1998, as amended, among Blackstone, BCCLP and certain of its
affiliates, and certain affiliates of TCI.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Investment Company Act" shall mean the Investment Company Act
of 1940, as amended, and the rules and regulations of the Commission promulgated
thereunder.
"NASD" shall mean the National Association of Securities
Dealers, Inc.
"Partnership Agreement" shall mean the Bresnan Communications
Company Limited Partnership Amended and Restated Partnership Agreement to be
entered into by the parties thereto upon the consummation of the TCI
Transactions.
42
"Regulation D" shall mean Regulation D under the Act.
"Regulation S" shall mean Regulation S under the Act.
"TCI" shall mean Tele-Communications, Inc., a Delaware
corporation.
"Trust Indenture Act" shall mean the Trust Indenture Act of
1939, as amended, and the rules and regulations of the Commission promulgated
thereunder.
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement and your acceptance shall represent a binding agreement
among us.
Very truly yours,
BRESNAN COMMUNICATIONS GROUP LLC
By Bresnan Communications Company Limited Partnership, its sole member
By BCI (USA), L.L.C., managing general partner
By Bresnan Communications, Inc., member
By /s/ Xxxxxx Xxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President & General Counsel
BRESNAN CAPITAL CORPORATION
By /s/ Xxxxxx Xxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxx
Title: Authorized Representative
BRESNAN COMMUNICATIONS COMPANY LIMITED
PARTNERSHIP
By PCI (USA), L.L.C.,
Managing General Partner
By Bresnan Communications, Inc.
Member
By /s/ Xxxxxx Xxxxxxx
----------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President & General Counsel
43
The foregoing Agreement is hereby
confirmed and accepted as of the date
first above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxx Securities Inc.
Xxxxxx Xxxxxxx & Co. Incorporated
TD Securities (USA) Inc.
By: Xxxxxxx Xxxxx Xxxxxx Inc.
By /s/ Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
44
SCHEDULE I
Principal
Amount at
Maturity of
Senior
Principal Amount Discount
Initial Purchasers of Senior Notes Notes
------------------ --------------- -----
Xxxxxxx Xxxxx Xxxxxx Inc............................................... $85,000,000 $137,500,000
Chase Securities Inc................................................... $31,875,000 $51,562,500
TD Securities (USA) Inc................................................ $21,250,000 $34,375,000
Xxxxxx Xxxxxxx & Co. Incorporated...................................... $31,875,000 $51,562,500
----------- -----------
Total $170,000,000 $275,000,000
45
EXHIBIT A
Selling Restrictions for Offers and
Sales outside the United States
(1)(a) The Securities have not been and will not be registered
under the Act and may not be offered or sold within the United States or to, or
for the account or benefit of, U.S. persons except in accordance with Regulation
S under the Act or pursuant to an exemption from the registration requirements
of the Act. Each Initial Purchaser represents and agrees that, except as
otherwise permitted by Section 4(a)(i) of the Agreement to which this is an
exhibit, it has offered and sold the Securities, and will offer and sell the
Securities, (i) as part of their distribution at any time; and (ii) otherwise
until 40 days after the later of the commencement of the offering and the
Closing Date, only in accordance with Rule 903 of Regulation S under the Act.
Accordingly, each Initial Purchaser represents and agrees that neither it, nor
any of its Affiliates nor any person acting on its or their behalf has engaged
or will engage in any directed selling efforts with respect to the Securities,
and that it and they have complied and will comply with the offering
restrictions requirement of Regulation S. Each Initial Purchaser agrees that, at
or prior to the confirmation of sale of Securities (other than a sale of
Securities pursuant to Section 4(a)(i) of the Agreement to which this is an
exhibit), it shall have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases Securities from it
during the distribution compliance period a confirmation or notice to
substantially the following effect:
"The Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Act") and may not be offered or
sold within the United States or to, or for the account or benefit of,
U.S. persons (i) as part of their distribution at any time or (ii)
otherwise until 40 days after the later of the commencement of the
offering and February 2, 1999, except in either case in accordance with
Regulation S or Rule 144A under the Act. Terms used above have the
meanings given to them by Regulation S."
(b) Each Initial Purchaser also represents and agrees that it
has not entered and will not enter into any contractual
46
arrangement with any distributor with respect to the distribution of the
Securities, except with its Affiliates or with the prior written consent of the
Company.
(c) Terms used in this section have the meanings given to them
by Regulation S.
(2) Each Initial Purchaser represents and agrees that (i) it
has not offered or sold, and prior to the expiration of the period of six months
from the Closing Date, will not offer or sell, in the United Kingdom, by means
of any document, any Securities other than to persons whose ordinary business it
is to buy, hold, manage, or dispose of investments whether as principal or as
agent for purposes of their businesses or otherwise in circumstances that do not
constitute an offer (except in circumstances that do not constitute an offer to
the public within the meaning of the Public Offer of Securities Regulations
1995); (ii) it has complied and will comply with all applicable provisions of
the Financial Services Act 1986 of the United Kingdom with respect to anything
done by it in relation to the Securities in, from or otherwise involving the
United Kingdom; and (iii) it has only issued or passed on and will only issue or
pass on in the United Kingdom any document received by it in connection with the
issue of the Securities to a person who is of a kind described in Article 11(3)
of the Financial Services Act 1986 (Investment Advertisements) (Exemptions)
Order 1996 or is a person to whom the document may otherwise lawfully be issued
or passed on.
