Charter Communications, Inc. 55,088,700 Shares Class A Common Stock ($.001 par value) Underwriting Agreement
Exhibit
99.1
EXECUTION
COPY
Charter
Communications, Inc.
55,088,700
Shares
Class
A
Common Stock
($.001
par value)
February
9, 2006
Citigroup
Global Markets Inc.
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Charter
Communications, Inc., a corporation organized under the laws of Delaware (the
“Company”),
proposes to issue to Citigroup Global Markets Inc. (the “Underwriter”)
55,088,700 shares of Class A Common Stock, $.001 par value (“Common
Stock”)
of the
Company (said shares to be issued by the Company being hereinafter called the
“Underwritten
Securities”)
in a
“best efforts” offering as described in a registration statement (file number
333-130898) on Form S-1, as amended, including a related preliminary
prospectus, for registration under the Act of the offering and sale of the
Underwritten Securities (the “Registration
Statement”).
The
Underwritten Securities are being issued pursuant to a Share Lending Agreement,
dated November 22, 2004, among the Company, the Underwriter and certain other
parties (the “Share
Lending Agreement”).
Certain terms used herein are defined in Section 17 hereof.
1. Representations
and Warranties.
The
Company represents and warrants to, and agrees with, the Underwriter as set
forth below in this Section 1.
(a) The
Company has prepared and filed the Registration Statement with the Commission.
Such Registration Statement, including any amendments thereto filed prior to
the
Execution Time, has become effective. The Company has filed amendments thereto,
including a related preliminary prospectus, each of which has previously been
furnished to you. The Company will file with the Commission a final prospectus
in accordance with Rule 424(b). As filed, such final prospectus shall contain
all information required by the Act and the rules thereunder and, except to
the
extent the Underwriter shall agree in writing to a modification, shall be in
all
substantive respects in the form furnished to you prior to the Execution Time
or, to the extent not completed at the Execution Time, shall contain only such
specific additional information and other changes (beyond that contained in
the
latest Preliminary Prospectus) as the Company has advised you, prior to the
Execution Time, will be included or made therein.
(b) On
the
Effective Date, the Registration Statement did or will, and when the Prospectus
is first filed in accordance with Rule 424(b) and on the Closing Date
(as
defined herein) the Prospectus (and any supplements thereto) will, comply in
all
material respects with the applicable requirements of the Act; on the Effective
Date and at the Execution Time, the Registration Statement did not or will
not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the statements
therein not misleading; and, on the Effective Date, the Prospectus, if not
filed
pursuant to Rule 424(b), will not, and on the date of any filing pursuant
to Rule 424(b) and on the Closing Date and any settlement date, the
Prospectus (together with any supplement thereto) will not, include any untrue
statement of a material fact or omit to state a material fact necessary in
order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided,
however,
that
the Company makes no representations or warranties as to the information
contained in or omitted from the Registration Statement, or the Prospectus
(or
any supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Underwriter
specifically for inclusion in the Registration Statement or the Prospectus
(or
any supplement thereto),
it being
understood and agreed that the only such information furnished by the
Underwriter consists of the information described as such in Section 8
hereof.
(c) None
of
the Company or any of its subsidiaries has sustained since the date of the
latest audited financial statements included in the Disclosure Package any
material loss or interference with its business from fire, explosion, flood
or
other calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Disclosure Package; and, since the respective dates as
of
which information is given in the Disclosure Package, there has not been any
material change in the capital stock or limited liability company interests
or
long-term debt of the Company or any of its subsidiaries or any material adverse
change, or any development involving a prospective material adverse change,
in
or affecting the general affairs, management, financial position, members’ or
stockholders’ equity or results of operations of the Company’s subsidiaries,
taken as a whole, otherwise than as set forth or contemplated in the Disclosure
Package.
(d) The
Disclosure Package and the price to the public on the cover page of the
Prospectus, when taken together as a whole, do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding sentence
does not apply to statements in or omissions from the Disclosure Package based
upon and in conformity with written information furnished to the Company by
any
Underwriter through the Representatives specifically for use therein, it being
understood and agreed that the only such information furnished by or on behalf
of any Underwriter consists of the information described as such in Section
8
hereof.
(e) (i)
At
the time of filing the Registration Statement and (ii) as of the Execution
Time
(with such date being used as the determination date for purposes of this clause
(ii)), the Company was not and is not an Ineligible Issuer (as defined in Rule
405),
2
without
taking account of any determination by the Commission pursuant to Rule 405
that
it is not necessary that the Company be considered an Ineligible
Issuer.
(f) Each
Issuer Free Writing Prospectus does not include any information that conflicts
with the information contained in the Registration Statement, including any
document incorporated by reference therein that has not been superseded or
modified. The foregoing sentence does not apply to statements in or omissions
from the Issuer Free Writing Prospectus based upon and in conformity with
written information furnished to the Company by any Underwriter through the
Representatives specifically for use therein,
it being
understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in Section 8
hereof.
(g) The
Company and each of its subsidiaries has good and marketable title to all real
property and good and valid title to all personal property owned by it reflected
as owned in the financial statements included in the Disclosure Package and
the
Prospectus, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Disclosure Package and the Prospectus or
except such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries; and any real property and buildings held under
lease by the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material
and
do not interfere with the use made and proposed to be made of such property
and
buildings by the Company and its subsidiaries.
(h) The
Company has been duly incorporated and is validly existing as a corporation
in
good standing under the laws of the State of Delaware, and has power and
authority to own its properties and conduct its business as described in the
Disclosure Package and the Prospectus and to execute, deliver and perform its
obligations under this Agreement, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification; and is not subject
to
liability or disability by reason of the failure to be so qualified in any
such
jurisdiction, except such as would not, individually or in the aggregate, have
a
material adverse effect on the current or future financial position,
stockholders’ equity or results of operations of the Company and the Company’s
subsidiaries, taken as a whole (a “Material
Adverse Effect”);
each
of the Company’s subsidiaries has been duly incorporated or formed, as the case
may be, and is validly existing as a corporation, partnership or limited
liability company, as the case may be, in good standing under the laws of its
jurisdiction of incorporation or formation, in each case except such as would,
individually or in the aggregate, not result in a Material Adverse
Effect.
(i) All
the
outstanding capital stock, limited liability company interests or partnership
interests, as the case may be, of the Company and each “significant subsidiary”
(as such term is defined in Rule 1-02 of Regulation S-X) of the Company (each
a
“Significant
Subsidiary”)
have
been duly and validly authorized and issued, are fully paid and nonassessable
and (except as otherwise set forth in the Disclosure Package
3
and
the
Prospectus) are owned directly or indirectly by the Company, free and clear
of
all liens, encumbrances, equities or claims.
(j) The
Company’s authorized equity capitalization is as set forth in the Prospectus;
the capital stock of the Company conforms to the description thereof contained
in the Disclosure
Package
and the
Prospectus; the outstanding shares of Common Stock have been duly authorized
and
validly issued and are fully paid and nonassessable; the shares of Underwritten
Securities have been duly authorized and, when issued upon payment of the Loan
Fee (as defined herein) in accordance with the terms of this Agreement and
the
Share Lending Agreement, will be validly issued, fully paid and nonassessable;
the Board of Directors of the Company has duly and validly adopted resolutions
reserving such shares of Underwritten Securities for issuance upon payment
of
the Loan Fee in accordance with the terms of this Agreement and the Share
Lending Agreement; the holders of outstanding shares of capital stock of the
Company are not entitled to preemptive or other rights to subscribe for the
Underwritten Securities; and, except as set forth in the Disclosure
Package
and the
Prospectus, no options, warrants or other rights to purchase, agreements or
other obligations to issue, or rights to convert any obligations into or
exchange any securities for, shares of capital stock of or ownership interests
in the Company are outstanding.
(k) This
Agreement has been duly authorized and executed by the Company and constitutes
the legal, valid and binding obligation of the Company, enforceable against
the
Company in accordance with its terms (subject, as to enforcement, to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws affecting
creditors’ rights generally from time to time in effect and to general equitable
principles, whether arising in equity or at law).
(l) The
Share
Lending Agreement has been duly authorized by the Company and constitutes the
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms (subject, as to enforcement, to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws affecting
creditors’ rights generally from time to time in effect and to general equitable
principles, whether arising in equity or at law).
(m) None
of
the transactions contemplated by this Agreement will violate or result in a
violation of Section 7 of the Exchange Act including Regulations T, U, and
X of
the Board of Governors of the Federal Reserve System.
(n) Prior
to
the date hereof, none of the Company or any of its affiliates has taken any
action which is designed to or which has constituted or which might have been
expected to cause or result in stabilization or manipulation of the price of
any
security of the Company in connection with the offering of the Underwritten
Securities.
(o) The
issue
and sale of the Underwritten Securities and the compliance by the Company with
all provisions of this Agreement and the Share Lending Agreement and the
consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or
4
constitute
a default under, any indenture, mortgage, deed of trust, loan agreement,
lease,
license, franchise agreement, permit or other agreement or instrument to
which
the Company or any of the Company’s subsidiaries is a party or by which the
Company or any of the Company’s subsidiaries is bound or to which any of the
property or assets of the Company or any of the Company’s subsidiaries is
subject, nor will such action result in any violation of any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of the Company’s subsidiaries or any of
their properties, including the Communications Act of 1934, as amended, the
Cable Communications Policy Act of 1984, as amended, the Cable Television
Consumer Protection and Competition Act of 1992, as amended, and the
Telecommunications Act of 1996, as amended (collectively, the “Cable
Acts”),
any
order, rule or regulation of the Federal Communications Commission (the
“FCC”),
or
the Order Instituting Cease and Desist Proceedings, Making Findings, and
Imposing a Cease and Desist Order Pursuant to Section 21C of the Exchange
Act,
dated July 27, 2004, issued In the Matter of Charter Communications, Inc.,
except where such conflicts, breaches, violations or defaults would not,
individually or in the aggregate, have a Material Adverse Effect and would
not
have the effect of preventing the Company from performing any of its respective
obligations under the Share Lending Agreement and this Agreement; nor will
such
action result in any violation of the certificate of incorporation or bylaws
of
the Company; and no consent, approval, authorization, order, registration
or
qualification of or with any such court or governmental agency or body is
required, including under the Cable Acts or any order, rule or regulation
of the
FCC, for the issue and sale of the Underwritten Securities or the consummation
by the Company of the transactions contemplated by the Share Lending Agreement
and this Agreement, except registration of the Underwritten Securities under
the
Act and such consents, approvals, authorizations, registrations or
qualifications as have been made or except as may be required under the state
or
foreign securities or Blue Sky laws in connection with the borrow and
distribution of the Underwritten Securities or such as may be required by
the
National Association of Securities Dealers, Inc.
(p) None
of
the Company or any of the Company’s subsidiaries is (i) in violation of its
certificate of incorporation, bylaws, certificate of formation, limited
liability company agreement, partnership agreement or other organizational
document, as the case may be, (ii) in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease, license, permit or other
agreement or instrument to which it is a party or by which it or any of its
properties may be bound or (iii) in violation of the terms of any franchise
agreement, or any law, statute, rule or regulation or any judgment, decree
or
order, in any such case, of any court or governmental or regulatory agency
or
other body having jurisdiction over the Company or any of the Company’s
subsidiaries or any of their properties or assets, including the Cable Acts
or
any order, rule or regulation of the FCC, except, in the case of clauses (ii)
and (iii), such as would not, individually or in the aggregate, have a Material
Adverse Effect.
(q) The
statements set forth in the Disclosure
Package and the Prospectus
under the captions “Risk Factors,”“Share Lending Agreement,”“Regulation and
Legislation,”“Description of Capital Stock and Membership Units,”“Management,”
5
“Certain
Relationships and Related Transactions,”“Description of Certain Indebtedness,”“Business,”“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” and “Certain United States Tax Consequences For
Non-United States Holders,” insofar as they purport to describe the provisions
of the laws, documents and arrangements referred to therein and to the extent
not superseded by subsequent disclosure, are accurate in all material
respects.
(r) Other
than as set forth in the Disclosure Package, there
are
no legal or governmental proceedings (including by the FCC or any franchising
authority) pending to which the Company or any of the Company’s subsidiaries is
a party or of which any property of the Company or any of the Company’s
subsidiaries is the subject which, if determined adversely with respect to
the
Company or any of the Company’s subsidiaries, would, individually or in the
aggregate, have a Material Adverse Effect; and, to the best knowledge of the
Company and, except
as
disclosed in the Disclosure Package, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(s) The
Company and the Company’s subsidiaries carry insurance (including
self-insurance) in such amounts and covering such risks as in the reasonable
determination of the Company is adequate for the conduct of its business and
the
value of its properties.
(t) Except
as
set forth in the Disclosure Package, there is no strike, labor dispute, slowdown
or work stoppage with the employees of any of the Company or its subsidiaries
which is pending or, to the best knowledge of the Company, threatened which
would, individually or in the aggregate, have a Material Adverse
Effect.
(u) The
Company is not and after giving effect to the offering and sale of the
Underwritten Securities will not be, an “investment company” or any entity
“controlled” by an “investment company” as such terms are defined in the
Investment Company Act of 1940, as amended.
(v) The
consolidated financial statements (including the notes thereto) included in
the
Disclosure Package
and the
Prospectus
present fairly in all material respects the respective consolidated financial
positions, results of operations and cash flows of the entities to which they
relate at the dates and for the periods to which they relate and have been
prepared in accordance with U.S. generally accepted accounting principles
(“GAAP”)
applied on a consistent basis (except as otherwise noted therein). The selected
historical financial data in the Disclosure Package
and the
Prospectus
present fairly in all material respects the information shown therein and have
been prepared and compiled on a basis consistent with the audited financial
statements included therein.
(w) The
pro
forma financial information included in the Disclosure Package
and the
Prospectus
(i) complies as to form in all material respects with the applicable
requirements of Regulation S-X for Form S-1 promulgated under the Exchange
Act,
and (ii) has been properly computed on the bases described therein; the
assumptions used in
6
the
preparation of the pro forma financial information included in the Disclosure
Package and the Prospectus are reasonable and the adjustments used therein
are
appropriate to give effect to the transactions or circumstances referred
to
therein.
(x) KPMG
LLP,
who has certified the financial statements included in the Prospectus, is a
firm
of independent public accountants as required by the Act, based upon
representations by such firm to the Company.
(y) The
Company and the Company’s subsidiaries own or possess, or can acquire on
reasonable terms, adequate licenses, trademarks, service marks, trade names
and
copyrights (collectively, “Intellectual
Property”)
necessary to conduct the business now or proposed to be operated by each of
them
as described in the Disclosure Package
and the
Prospectus,
except where the failure to own, possess or have the ability to acquire any
Intellectual Property would not, individually or in the aggregate, have a
Material Adverse Effect; and none of the Company or the Company’s subsidiaries
has received any notice of infringement of or conflict with (and none actually
knows of any such infringement of or conflict with) asserted rights of others
with respect to any Intellectual Property which, if any such assertion of
infringement or conflict were sustained would, individually or in the aggregate,
have a Material Adverse Effect.
(z) Except
as
described in the Disclosure Package, the Company and the Company’s subsidiaries
have obtained all consents, approvals, orders, certificates, licenses, permits,
franchises and other authorizations of and from, and have made all declarations
and filings with, all governmental and regulatory authorities (including the
FCC), all self-regulatory organizations and all courts and other tribunals
legally necessary to own, lease, license and use their respective properties
and
assets and to conduct their respective businesses in the manner described in
the
Disclosure Package
and the
Prospectus,
except to the extent that the failure to so obtain or file would not,
individually or in the aggregate, have a Material Adverse Effect.
(aa) Except
as
described in the Disclosure Package, the Company and the Company’s subsidiaries
have filed all necessary federal, state and foreign income and franchise tax
returns required to be filed as of the date hereof, except where the failure
to
so file such returns would not, individually or in the aggregate, have a
Material Adverse Effect, and have paid all taxes shown as due thereon; and
there
is no tax deficiency that has been asserted against the Company or any of its
subsidiaries (other than those which the amount or validity thereof are
currently being challenged in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the relevant entity) that could reasonably be expected to result,
individually or in the aggregate, in a Material Adverse Effect.
(bb) The
Company and the Company’s subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are
executed in accordance with management’s general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s general
or
7
specific
authorization; and (iv) the recorded accountability for assets is compared
with
the existing assets at reasonable intervals and appropriate action is taken
with
respect to any differences.
(cc) Except
as
described in the Disclosure Package: (i) each of the franchises held by, or
necessary for any operations of, the Company and its subsidiaries that are
material to the Company and its subsidiaries, taken as a whole, is in full
force
and effect, with no material restrictions or qualifications; (ii) to the best
knowledge of the Company, no event has occurred which permits, or with notice
or
lapse of time or both would permit, the revocation or non-renewal of any such
franchises, assuming the filing of timely renewal applications and the timely
payment of all applicable filing and regulatory fees to the applicable
franchising authority, or which would be reasonably likely to result,
individually or in the aggregate, in any other material impairment of the rights
of the Company and the Company’s subsidiaries in such franchises; and (iii) the
Company has no reason to believe that any franchise that is material to the
operation of the Company and its subsidiaries will not be renewed.
(dd) Except
as
described in the Disclosure Package, each of the programming agreements entered
into by, or necessary for any operations of, the Company or its subsidiaries
that are material to the Company and its subsidiaries, taken as a whole, is
in
full force and effect (or in any cases where the Company or its subsidiaries
and
any suppliers of content are operating in the absence of a programming
agreement, such content providers and the Company and its subsidiaries provide
and receive service in accordance with terms that have been agreed to or
consistently acknowledged or accepted by both parties, including situations
in
which providers or suppliers of content accept regular payment for the provision
of such content); and to the best knowledge of the Company, no event has
occurred (or with notice or lapse of time or both would occur) which would
be
reasonably likely to result in the early termination or non-renewal of any
such
programming agreements and which would, individually or in the aggregate, result
in a Material Adverse Effect; no amendments or other changes to such programming
agreements, other than amendments relating to intra-company transfers,
extensions of termination dates or pricing adjustments, together with other
changes that are not in the aggregate material, have been made to the copies
of
the programming agreements provided for the review of the Underwriter or its
counsel.
(ee) The
Company and the Company’s subsidiaries (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating
to
the protection of human health and safety, the environment or hazardous or
toxic
substances or wastes, pollutants or contaminants (“Environmental
Laws”),
(ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license
or
approval, except where such noncompliance with Environmental Laws, failure
to
receive required permits, licenses or other approvals or failure to comply
with
the terms and conditions of such permits, licenses or approvals would not,
individually or in the aggregate, have a Material Adverse Effect.
8
(ff) The
Company maintains a system of disclosure controls and procedures to ensure
that
material information relating to the Company, including its consolidated
subsidiaries, is made known to each of them by others within those entities,
particularly during the period in which the periodic reports are being
prepared.
(gg) The
Registration Statement complied when it became effective, complies and, at
the
time of the loan of the Underwritten Securities, will comply, and each of the
Disclosure Package
and the
Prospectus
conformed as of its date, conforms and, at the time of loan of the Underwritten
Securities, will conform in all material respects with the requirements of
the
Act and any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the Prospectus or
to
be filed as exhibits to the Registration Statement have been and will be so
described or filed.
(hh) There
is,
and has been, no material failure on the part of the Company or the Company’s
subsidiaries, or any of their directors or officers, in their capacities as
such, to comply with any provision of the Sarbanes Oxley Act of 2002 (the
“Sarbanes Oxley Act”) and the rules and regulations promulgated in connection
therewith, including Section 402 related to loans and Sections 302 and 906
related to certifications.
(ii) The
statistical and market-related data included in the Disclosure
Package
and the
Prospectus
are based on or derived from sources that the Company believes to be reliable
and accurate.
Any
certificate signed by any officer of the Company and delivered to the
Underwriter or counsel for the Underwriter in connection with the offering
of
the Underwritten Securities shall be deemed a representation and warranty by
the
Company, as to matters covered thereby, to the Underwriter.
2. Issuance
and Loan of Underwritten Securities.
Subject
to the terms and conditions of, and in reliance upon the representations and
warranties in, this Agreement and the Share Lending Agreement, the Company
agrees to issue to the Underwriter 55,088,700 shares of Class A Common Stock,
or
such lesser number as specified by the Underwriter pursuant to this Section
2,
and the Underwriter agrees to borrow from the Company (subject to the
Underwriter’s obligation to repay such borrowings as provided in the Share
Lending Agreement), in exchange for the payment of a fee of $0.001 per share
(the “Loan
Fee”),
up to
55,088,700 shares of Class A Common Stock, or such lesser number as specified
by
the Underwriter at least one day prior to the Closing Date. This Agreement
constitutes a “Borrowing Notice” pursuant to Section 2(b) of the Share Lending
Agreement.
3. Delivery
and Payment.
Delivery of the Underwritten Securities and payment of the Loan Fee in respect
thereof shall be made at 10:00 AM, New York City time, on February 14,
2006, or at such time on such later date not more than three Business Days
after
the foregoing date as the Underwriter shall designate (such date and time of
delivery and payment for the Underwritten Securities being herein called the
“Closing
Date”).
Delivery of the Underwritten Securities shall be made to the Underwriter for
the
account of the Underwriter against payment by the Underwriter of
9
the
Loan
Fee in respect thereof to or upon the order of the Company by wire transfer
payable in same-day funds to an account specified by the Company. Delivery
of
the Underwritten Securities shall be made through the facilities of The
Depository Trust Company unless the Underwriter shall otherwise
instruct.
4. Offering
by Underwriter.
It is
understood that the Underwriter proposes to offer the Underwritten Securities
for sale to the public as set forth in the Prospectus.
5. Agreements.
The
Company agrees with the Underwriter that:
(a) Prior
to
the termination of the offering of the Underwritten Securities, the Company
will
not file any amendment of the Registration Statement or supplement to the
Prospectus or any Rule 462(b) Registration Statement unless the Company
has
furnished to the Underwriter a copy for its review prior to filing and will
not
file any such proposed amendment or supplement to which the Underwriter
reasonably objects. The Company will cause the Prospectus, properly completed,
and any supplement thereto to be filed in a form approved by the Underwriter
with the Commission pursuant to the applicable paragraph of Rule 424(b)
within the time period prescribed by Rule 424(b) and will provide evidence
satisfactory to the Underwriter of such timely filing. The Company will promptly
advise the Underwriter (1) when the Prospectus, and any supplement thereto,
shall have been filed (if required) with the Commission pursuant to
Rule 424(b) or when any Rule 462(b) Registration Statement shall
have
been filed with the Commission, (2) when, prior to termination of the
offering of the Underwritten Securities, any amendment to the Registration
Statement shall have been filed or become effective, (3) of any request
by
the Commission or its staff for any amendment of the Registration Statement,
or
any Rule 462(b) Registration Statement, or for any supplement to the
Prospectus or for any additional information, (4) of the issuance by
the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any notice objecting to its use or the institution or
threatening of any proceeding for that purpose and (5) of the receipt
by
the Company of any notification with respect to the suspension of the
qualification of the Underwritten Securities for sale in any jurisdiction or
the
institution or threatening of any proceeding for such purpose. The Company
will
use its best efforts to prevent the issuance of any such stop order or the
occurrence of any such suspension or objection and, upon such issuance,
occurrence or objection to obtain as soon as possible the withdrawal of such
stop order or relief from such occurrence or objection, including, if necessary,
by filing an amendment to the Registration Statement or a new registration
statement and using its best efforts to have such amendment or new registration
statement declared effective as soon as practicable.
(b) If
at any
time prior to the filing of the Prospectus pursuant to Rule 424(b), any event
occurs an event as a result of which the Disclosure Package 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 at such time not misleading, the Company will (1)
notify promptly the Underwriter so that any use of the Disclosure Package may
cease until it is amended or supplemented,
10
(2)
amend
or supplement the Disclosure Package to correct such statement or omission,
and
(3) supply any amendment or supplement to you in such quantities as you may
reasonably request.
(c) If,
at
any time when a prospectus relating to the Underwritten Securities is required
to be delivered under the Act (including in circumstances where such requirement
may be satisfied pursuant to Rule 172), any event occurs as a result of which
the Prospectus as then 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
at such time not misleading, or if it shall be necessary to amend the
Registration Statement or supplement the Prospectus to comply with the Act,
the
Company promptly will (1) notify the Underwriter of any such event,
(2) prepare and file with the Commission, subject to the second sentence
of
paragraph (a) of this Section 5, an amendment or supplement which
will
correct such statement or omission or otherwise effect such compliance; and
(3) supply any supplemented Prospectus to the Underwriter in such
quantities as the Underwriter may reasonably request.
(d) As
soon
as practicable, the Company will make generally available to its security
holders and to the Underwriter an earnings statement or statements of the
Company and its subsidiaries which will satisfy the provisions of
Section 11(a) of the Act and Rule 158 under the Act.
(e) The
Company will furnish to the Underwriter and counsel for the Underwriter signed
copies of the Registration Statement (including exhibits thereto) and, so long
as delivery of a prospectus by the Underwriter or a dealer may be required
by
the Act (including in circumstances where such requirement may be satisfied
pursuant to Rule 172), as many copies of each Preliminary Prospectus, the
Prospectus and each Issuer Free Writing Prospectus and any supplement thereto
as
the Underwriter may reasonably request.
(f) The
Company will arrange, if necessary, for the qualification of the Underwritten
Securities for sale under the laws of such jurisdictions as the Underwriter
may
designate and will maintain such qualifications in effect so long as required
for the distribution of the Underwritten Securities; provided that in no event
shall the Company be obligated to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action that would subject it
to
taxation or service of process in suits, other than those arising out of the
offering or sale of the Underwritten Securities, in any jurisdiction where
it is
not now so subject.
(g) The
Company will comply with all applicable securities and other applicable laws,
rules and regulations, including the Sarbanes Oxley Act, and to use its best
efforts to cause the Company’s directors and officers, in their capacities as
such, to comply with such laws, rules and regulations, including the provisions
of the Sarbanes Oxley Act.
11
(h) The
Company will not take, directly or indirectly, any action designed to or that
would constitute or that might reasonably be expected to cause or result in,
under the Exchange Act or otherwise, stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the
Underwritten Securities.
(i) The
Company agrees to pay the costs and expenses relating to the following matters:
(i) the preparation, printing or reproduction and filing with the
Commission of the Registration Statement (including financial statements and
exhibits thereto), each Preliminary Prospectus, the Prospectus and each Issuer
Free Writing Prospectus, and each amendment or supplement to any of them;
(ii) the printing (or reproduction) and delivery (including postage,
air
freight charges and charges for counting and packaging) of such copies of the
Registration Statement, each Preliminary Prospectus, the Prospectus and each
Issuer Free Writing Prospectus, and all amendments or supplements to any of
them, as may, in each case, be reasonably requested for use in connection with
the offering and sale of the Underwritten Securities; (iii) the
preparation, printing, authentication, issuance and delivery of certificates
for
the Underwritten Securities, including any stamp or transfer taxes in connection
with the original issuance and sale of the Underwritten Securities;
(iv) the printing (or reproduction) and delivery of this Agreement,
any
blue sky memorandum and all other agreements or documents printed (or
reproduced) and delivered in connection with the offering of the Underwritten
Securities; (v) the registration of the Underwritten Securities under
the
Exchange Act and the listing of the Underwritten Securities on the Nasdaq
National Market; (vi) any registration or qualification of the Underwritten
Securities for offer and sale under the securities or blue sky laws of the
several states (including filing fees and the reasonable fees and expenses
of
counsel for the Underwriter relating to such registration and qualification);
(vii) any filings required to be made with the National Association
of
Securities Dealers, Inc. (including filing fees and the reasonable fees and
expenses of counsel for the Underwriter relating to such filings);
(viii) the transportation and other expenses incurred by or on behalf
of
Company representatives in connection with presentations to prospective
purchasers of the Underwritten Securities; (ix) the fees and expenses
of
the Company’s accountants and the fees and expenses of counsel (including local
and special counsel) for the Company; and (x) all other costs and expenses
incident to the performance by the Company of its obligations hereunder.
(j) The
Company will continue to comply with its obligations under the Share Loan
Registration Rights Agreement dated as of November 22, 2004, between the Company
and the Underwriter.
(k) The
Company agrees that, unless it has obtained or will obtain the prior written
consent of the Underwriter, and the Underwriter, severally and not jointly,
agrees with the Company that, unless it has obtained or will obtain, as the
case
may be, the prior written consent of the Company, it has not made and will
not
make any offer relating to the Securities that would constitute an Issuer Free
Writing Prospectus or that would otherwise constitute a “free writing
prospectus” (as defined in Rule 405) required to be filed by the Company with
the Commission or retained by the Company under Rule 433; provided that the
prior written consent of the parties hereto shall be deemed to have
12
been
given in respect of the Free Writing Prospectuses included in Schedule I
hereto.
Any such free writing prospectus consented to by the Representatives or the
Company is hereinafter referred to as a “Permitted Free Writing Prospectus.” The
Company agrees that (x) it has treated and will treat, as the case may be,
each
Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and
(y)
it has complied and will comply, as the case may be, with the requirements
of
Rules 164 and 433 applicable to any Permitted Free Writing Prospectus, including
in respect of timely filing with the Commission, legending and record
keeping.
6. Conditions
to the Obligations of the Underwriter.
The
obligations of the Underwriter to borrow the Underwritten Securities and pay
the
Loan Fee as provided herein shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein
as of
the Execution Time and the Closing Date, to the accuracy of the statements
of
the Company made in any certificates pursuant to the provisions hereof, to
the
performance by the Company of its obligations hereunder and to the following
additional conditions:
(a) (i)
The
Prospectus, and any such supplement, will be filed in the manner and within
the
time period required by Rule 424(b); any material required to be filed
by
the Company pursuant to Rule 433(d) under the Act shall have been filed with
the
Commission within the applicable time periods prescribed for such filings by
Rule 433; and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have
been instituted or threatened.
(ii) If,
at or
subsequent to the Execution Time it is necessary for the Registration Statement
or a post-effective amendment thereto to be declared effective, the Registration
Statement or such post-effective amendment shall have become effective no later
than such date and time as consented to in writing by the Underwriter, and
all
filings, if any, required by Rules 424(b) and 430A under the Act shall have
been
timely made.
(b) The
Company shall have requested and caused Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel
for the Company, to have furnished to the Underwriter their opinion, dated
the
Closing Date and addressed to the Underwriter, covering such matters as are
typically provided in opinions delivered in connection with underwritten equity
offerings, in form and substance reasonably satisfactory to you.
(c) Xxxx,
Raywid & Xxxxxxxxx L.L.P., special regulatory counsel to the Company, shall
have furnished to you their written opinion, dated the Closing Date, in form
and
substance reasonably satisfactory to you, to the effect that:
(i) The
issue
and sale of the Underwritten Securities and the compliance by the Company with
the Share Lending Agreement and the consummation of the transactions herein
and
therein contemplated do not and will not contravene the Cable Acts or any order,
rule or regulation of the FCC to which the Company or any of its subsidiaries
or
any of their property is subject; however, to the extent that any
13
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;
(ii) To
the
best of such counsel’s knowledge, no consent, approval, authorization or order
of, or registration, qualification or filing with the FCC is required under
the
Cable Acts or any order, rule or regulation of the FCC in connection with the
issue and sale of the Underwritten Securities and the compliance by the Company
with all the provisions of this Agreement and the Share Lending Agreement and
the consummation of the transactions herein and therein contemplated; however,
to the extent that any 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;
(iii) The
statements set forth in the Prospectus under the caption “Regulation and
Legislation” and under the caption “Risk Factors” under the subheading “Risks
Related to Regulatory and Legislative Matters,” insofar as they constitute
summaries of laws referred to therein, concerning the Cable Acts and the
published rules, regulations and policies promulgated by the FCC thereunder,
fairly summarize the matters described therein;
(iv) To
such
counsel’s knowledge based solely upon its review of publicly available records
of the FCC and operational information provided by the Company’s and the
Company’s subsidiaries’ management, the Company and its subsidiaries hold all
FCC licenses for cable antenna relay services necessary to conduct the business
of the Company and its subsidiaries as currently conducted, except to the extent
the failure to hold such FCC licenses would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect;
and
(v) Except
as
disclosed in the Prospectus and except with respect to rate regulation matters,
and general rulemakings and similar matters relating generally to the cable
television industry, to such counsel’s knowledge, based solely upon its review
of the publicly available records of the FCC and upon inquiry of the Company’s
and its subsidiaries’ management, during the time the cable systems of the
Company and its subsidiaries have been owned by the Company and its subsidiaries
(A) there has been no adverse FCC judgment, order or decree issued by the FCC
relating to the ongoing operations of any of the Company or one of its
subsidiaries that has had or could reasonably be expected to have a Material
Adverse Effect; and (B) there are no actions, suits, proceedings, inquiries
or
investigations by or before the FCC pending or threatened in writing against
or
specifically affecting the Company or any of its subsidiaries or any cable
system of the Company or any of its subsidiaries which could, individually
or in
the aggregate, be reasonably expected to result in a Material Adverse
Effect.
14
(d) The
General Counsel of the Company, shall have furnished to the Underwriter his
written opinion, dated as of the Closing Date, in form and substance
satisfactory to you, to the effect that:
(vi) Each
subsidiary of the Company listed on a schedule attached to such counsel’s
opinion (collectively, the “Charter
Subsidiaries”)
has
been duly incorporated or formed, as the case may be, and is validly existing
as
a corporation, limited liability company or partnership, as the case may be,
in
good standing under the laws of its jurisdiction of incorporation or formation;
and all the issued shares of capital stock, limited liability company interests
or partnership interests, as the case may be, of each Charter Subsidiary are
set
forth on the books and records of the Company and, except for those Charter
Subsidiaries that are general partners, assuming receipt of requisite
consideration therefor, are fully paid and nonassessable (in the case of
corporate entities) and not subject to additional capital contributions (in
the
case of limited liability company entities and limited partnerships); and,
except as otherwise set forth in the Prospectus, and except for liens not
prohibited under the credit agreements listed on such schedule, all outstanding
shares of capital stock of each of the Charter Subsidiaries are owned by the
Company, either directly or indirectly or through wholly-owned subsidiaries
free
and clear of any perfected security interest and, to the knowledge of such
counsel, after due inquiry, any other security interest, claim, lien or
encumbrance;
(vii) Each
of
the Company and the Charter Subsidiaries has been duly qualified as a foreign
corporation, partnership or limited liability company, as the case may be,
for
the transaction of business and is in good standing under the laws of each
jurisdiction set forth in a schedule to such counsel’s opinion;
(viii) To
the
best of such counsel’s knowledge and other than as set forth in the Prospectus,
there are no legal or governmental proceedings pending to which the Company,
or
any of the Charter Subsidiaries is party or of which any property of the Company
or any of the Charter Subsidiaries is the subject, of a character required
to be
disclosed in the Registration Statement, which is not so disclosed, except
for
such proceedings which are not likely to have, individually or in the aggregate,
a Material Adverse Effect; and, to the best of such counsel’s knowledge and
other than as set forth in the Prospectus, no such proceedings are overtly
threatened by governmental authorities or by others; and
(ix) The
issue
and sale of the Underwritten Securities and the compliance by the Company with
all the provisions of the Share Lending Agreement and the consummation of the
transactions therein contemplated will not result in a violation of the
provisions of the certificate of incorporation or by-laws, or certificate of
formation or limited liability company agreement or partnership agreement,
as
the case may be, of any of the Charter Subsidiaries.
(e) At
the
Execution Time and also on the Closing Date, KPMG LLP shall have furnished
to
the Underwriter a “comfort” letter or letters of the type customarily provided
in connection with underwritten equity offerings, dated the
15
respective
dates of delivery thereof, in form and substance reasonably satisfactory
to the
Underwriter;
(f) The
Underwriter shall have received from Weil, Gotshal & Xxxxxx LLP, counsel for
the Underwriter, such opinion or opinions as are customarily provided by
underwriters’ counsel in connection with the registration of equity securities
in underwritten offerings on Form S-1, dated the Closing Date and addressed
to
the Underwriter, with respect to the issuance and sale of the Underwritten
Securities, the Registration Statement, the Disclosure Package, and the
Prospectus (together with any supplement thereto) and other related matters
as
the Underwriter may reasonably require, and the Company shall have furnished
to
such counsel such documents as they request for the purpose of enabling them
to
pass upon such matters.
(g) The
Company shall have furnished to the Underwriter a certificate of the Company,
signed by the principal financial or accounting officer of the Company, dated
the Closing Date, to the effect that he or she has carefully examined the
Registration Statement, the Disclosure Package and any amendment or supplement
thereto and this Agreement and that:
(i) the
representations and warranties of the Company in this Agreement are true and
correct on and as of the Closing Date with the same effect as if made on the
Closing Date and the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at or prior to
the
Closing Date;
(ii) no
stop
order suspending the effectiveness of the Registration Statement has been issued
or any notice objecting to its use and no proceedings for that purpose have
been
instituted or, to the Company’s knowledge, threatened; and
(iii) since
the
date of the most recent financial statements included in the Prospectus
(exclusive of any supplement thereto), there has been no material adverse effect
on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or
not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Disclosure Package (exclusive of any supplement
thereto).
(h) Subsequent
to the Execution Time or, if earlier, the dates as of which information is
given
in the Registration Statement (exclusive of any amendment thereto) and the
Prospectus (exclusive of any supplement thereto), there shall not have been
(i) any change or decrease specified in the letter or letters referred
to
in paragraph (e) of this Section 6 or (ii) any change,
or any
development involving a prospective change, in or affecting the condition
(financial or otherwise), earnings, business or properties of the Company and
its subsidiaries taken as a whole, whether or not arising from transactions
in
the ordinary course of business, except as set forth in or contemplated in
the
Disclosure Package (exclusive of any supplement thereto) the effect of which,
in
any case referred to in clause (i) or (ii) above, is, in the sole judgment
of the Underwriter, so material and adverse as to make it impractical or
inadvisable to proceed
16
with
the
offering or delivery of the Underwritten Securities as contemplated by the
Registration Statement (exclusive of any amendment thereof), the Disclosure
Package (exclusive of any supplement thereto).
(i) Prior
to
the Closing Date, the Company shall have furnished to the Underwriter such
further information, certificates and documents as the Underwriter may
reasonably request.
(j) Subsequent
to the Execution Time, there shall not have been any decrease in the rating
of
any of the Company’s debt securities by any “nationally recognized statistical
rating organization” (as used 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.
(k) The
Underwritten Securities shall have been listed and admitted and authorized
for
trading on the Nasdaq National Market, and satisfactory evidence of such actions
shall have been provided to the Underwriter.
If
any of
the conditions specified in this Section 6 shall not have been fulfilled
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
reasonably satisfactory in form and substance to the Underwriter and counsel
for
the Underwriter, this Agreement and all obligations of the Underwriter hereunder
may be canceled at, or at any time prior to, the Closing Date by the
Underwriter. Notice of such cancellation shall be given to the Company in
writing or by telephone or facsimile confirmed in writing.
The
documents required to be delivered by this Section 6 shall be delivered
at
the office of Weil, Gotshal & Xxxxxx LLP, counsel for the Underwriter, at
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, on the Closing Date.
7. Reimbursement
of Underwriter’s Expenses.
If the
sale of the Underwritten Securities provided for herein is not consummated
because any condition to the obligations of the Underwriter set forth in
Section 6 hereof is not satisfied, because of any termination pursuant
to
Section 9 hereof or because of any refusal, inability or failure on
the
part of the Company to perform any agreement herein or comply with any provision
hereof other than by reason of a default by the Underwriter, the Company will
reimburse the Underwriter on demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred
by
it in connection with the proposed loan and sale of the Underwritten
Securities.
8. Indemnification
and Contribution.
(a) The
Company agrees to indemnify and hold harmless the Underwriter, the directors,
officers, employees and agents of the Underwriter and each person who controls
the Underwriter within the meaning of either the Act or 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
17
under
the
Act, the Exchange Act or other Federal or state statutory law or regulations,
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
Registration Statement or in any Preliminary Prospectus, the Prospectus or
any
Issuer Free Writing Prospectus, or in any amendment thereof or supplement
thereto, or arise out of or are based upon the omission or alleged omission
to
state therein a material fact required to be stated therein or necessary
to make
the statements therein not misleading, and 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
the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such
untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished
to
the Company by or on behalf of the Underwriter specifically for inclusion
therein. This indemnity agreement will be in addition to any liability which
the
Company may otherwise have.
(b) The
Underwriter agrees to indemnify and hold harmless the Company, each of its
directors, each of its officers who signs the Registration Statement, and each
person who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company
to
the Underwriter, but only with reference to written information relating to
the
Underwriter furnished to the Company by or on behalf of the Underwriter
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
the Underwriter may otherwise have. The Company acknowledges that the statements
set forth (i) in the last paragraph of the cover page regarding delivery of
the
Underwritten Securities, (ii) under the heading “Share Lending Agreement,” (A)
the bulleted language in the seventh-to-last paragraph, (B) the first and second
sentences of the sixth-to-last paragraph and (C) the third and fourth sentences
in the third bullet of the fifth-to-last paragraph and (iii) under the heading
“Underwriting,” (A) the third-to-last sentence of the first paragraph and (B)
all the third paragraph other than the clause following the comma in the last
sentence of the paragraph of the Preliminary Prospectus and the Prospectus
constitute the only information furnished in writing by or on behalf of the
Underwriter for inclusion in any Preliminary Prospectus, the Prospectus and
any
Issuer Free Writing Prospectus.
(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 (i) will not relieve the
indemnifying party from liability under paragraph (a) or (b)
above
unless and to the extent the indemnifying party 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
18
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 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
separate counsel (including local counsel), 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 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.
(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 and the Underwriter severally agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating
or
defending the same) (collectively “Losses”)
to
which the Company and the Underwriter may be subject in such proportion as
is
appropriate to reflect the relative benefits received by the Company on the
one
hand and by the Underwriter on the other from the offering of the Underwritten
Securities; provided,
however,
that in
no case shall the Underwriter be responsible for any amount in excess of the
underwriting discount or commission applicable to the Underwritten Securities
borrowed by the Underwriter hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company and
the Underwriter severally shall contribute in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of the
Company on the one hand and of the Underwriter 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 shall be
deemed to be equal to the total net proceeds from the offering (before deducting
expenses) received by it, and benefits received by the Underwriter shall be
deemed to be equal to the total underwriting discounts and commissions, in
each
case as set forth on the cover page of the Prospectus. Relative
19
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
on the one hand or the Underwriter 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 and the Underwriter
agree
that it would not be just and equitable if contribution were determined by
pro
rata allocation or any 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 the Underwriter
within
the meaning of either the Act or the Exchange Act and each director, officer,
employee and agent of the Underwriter shall have the same rights to contribution
as the Underwriter, and each person who controls the Company within the meaning
of either the Act or the Exchange Act, each officer of the Company who shall
have signed the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company, subject in each case
to the
applicable terms and conditions of this paragraph (d).
9. Termination.
This
Agreement shall be subject to termination in the absolute discretion of the
Underwriter, by notice given to the Company prior to delivery of and payment
for
the Underwritten Securities, if at any time prior to such time (i) trading
in the Company’s Common Stock shall have been suspended by the Commission or the
Nasdaq National Market or trading in securities generally on the New York Stock
Exchange or the Nasdaq National Market shall have been suspended or limited
or
minimum prices shall have been established the New York Stock Exchange or the
Nasdaq National Market, (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
Underwriter, impractical or inadvisable to proceed with the offering or delivery
of the Underwritten Securities as contemplated by the Preliminary Prospectus
or
the Prospectus (exclusive of any supplement thereto)
10. Representations
and Indemnities to Survive.
The
respective agreements, representations, warranties, indemnities and other
statements of the Company or its officers and of the Underwriter 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 Underwriter or the Company
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 Underwritten Securities. The provisions of Section 7 and 8 hereof shall
survive the termination or cancellation of this Agreement.
11. Notices.
All
communications hereunder will be in writing and effective only on receipt,
and,
if sent to the Underwriter, will be mailed, delivered or telefaxed to the
Citigroup Global Markets Inc. General Counsel (fax no.:
20
(000) 000-0000)
and confirmed to the General Counsel, Citigroup Global Markets Inc., at 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: General Counsel;
or, if
sent to the Company, will be mailed, delivered or telefaxed to Charter
Communications, Inc., attention: General Counsel (fax no. (000) 000-0000)
and
confirmed to it Charter Communications, Inc., 00000 Xxxxxxxxxxx Xxxxx, Xx.
Xxxxx
XX 00000, attention General Counsel.
12. No
Fiduciary Duty.
The
Company hereby acknowledges that (a) the
loan of the Underwritten Securities pursuant to this Agreement and the Share
Lending Agreement is an arm’s-length commercial transaction between the Company,
on the one hand, and the Underwriter and any affiliate through which it may
be
acting, on the other,
(b) the
Underwriter is acting as principal and not as an agent or fiduciary of the
Company and (c) its engagement of the Underwriter in connection with the
Offering is as an independent contractor and not in any other capacity.
Furthermore, the Company agrees that it is solely responsible for making its
own
judgments in connection with the offering (irrespective of whether the
Underwriter has advised or is currently advising the Company on related or
other
matters). The
Company agrees that it will not claim that the Underwriter has rendered advisory
services of any nature or respect, or owes an agency, fiduciary or similar
duty
to the Company, in connection with such transaction or the process leading
thereto.
13. Integration.
This
Agreement supersedes all prior agreements and understandings (whether written
or
oral) between the Company and the Underwriters, with respect to the subject
matter hereof other than the Share Lending Agreement and the Share Loan
Registration Rights Agreement between the Company and the Underwriter, dated
November 22, 2004.
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 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 signed in one or more counterparts, each of which shall
constitute an original and all of which together shall constitute one and the
same agreement.
17. Headings.
The
section headings used herein are for convenience only and shall not affect
the
construction hereof.
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.
21
“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 New York City.
“Commission”
shall mean the Securities and Exchange Commission.
“Convertible
Notes” shall mean the Company’s 5.875% Convertible Senior Notes due
2009.
“Disclosure
Package” shall mean (i) the Statutory Prospectus as of the Execution Time, (ii)
the Issuer Free Writing Prospectuses, if any, identified in Schedule I hereto,
and (iii) any other Free Writing Prospectus that the parties hereto shall
hereafter expressly agree in writing to treat as part of the Disclosure
Package.
“Effective
Date” shall mean each date and time that the Registration Statement, any
post-effective amendment or amendments thereto and any Rule 462(b)
Registration Statement became or become effective.
“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.
“Free
Writing Prospectus” shall mean a free writing prospectus, as defined in Rule
405.
“Issuer
Free Writing Prospectus” shall mean an issuer free writing prospectus, as
defined in Rule 433.
“Preliminary
Prospectus” shall mean any preliminary prospectus referred to in
paragraph 1(a) above and any preliminary prospectus included in the
Registration Statement at the Effective Date that omits Rule 430A
Information.
“Prospectus”
shall mean the prospectus relating to the Underwritten Securities that is first
filed pursuant to Rule 424(b) after the Execution Time.
“Registration
Statement” shall mean the registration statement referred to in
paragraph 1(a) above, including exhibits and financial statements and
any
prospectus supplement relating to the Securities that is filed with the
Commission pursuant to Rule 424(b) and deemed part of such registration
statement pursuant to Rule 430B, as amended at the, as amended at the Execution
Time and, in the event any post-effective amendment thereto or any
Rule 462(b) Registration Statement becomes effective prior to the Closing
Date, shall also mean such registration statement as so amended.
22
“Rule
158”, “Rule 163”, “Rule 164”, “Rule 172”, “Rule 405”, “Rule 415”,
“Rule 424”, “Rule 430A”, Rule 430B”, “Rule 433” and “Rule 462” refer to
such rules under the Act.
“Rule 430A
Information” shall mean information with respect to the Underwritten Securities
and the offering thereof permitted to be omitted from the Registration Statement
when it becomes effective pursuant to Rule 430A.
“Rule 462(b)
Registration Statement” shall mean a registration statement and any amendments
thereto filed pursuant to Rule 462(b) relating to the offering covered
by
the registration statement referred to in Section 1(a) hereof.
“Statutory
Prospectus” shall mean, as of any time, the prospectus relating to the
Underwritten Securities that is included in the Registration Statement
immediately prior to that time, including any document that is incorporated
by
reference therein.
When
used
herein, the word “including” shall be deemed to be followed by the words
“without limitation” unless the context otherwise requires.
23
If
the
foregoing is in accordance with your understanding of our agreement, please
sign
and return to us the enclosed duplicate hereof, whereupon this letter and your
acceptance shall represent a binding agreement among the Company and the
Underwriter.
Very
truly yours,
Charter
Communications, Inc.
By: s/s
Xxxxxx Xxxxxxx
Name:
Xxxxxx Xxxxxxx
Title:
Senior Vice-President, Treasury and Finance
The
foregoing Agreement is hereby
confirmed
and accepted as of the
date
first above written.
Citigroup
Global Markets Inc.
By:
Citigroup Global Markets Inc.
By: s/s
Xxxxx Xxxxxxx
Name:
Xxxxx Xxxxxxx
Title:
Director
SCHEDULE I
Schedule
of Free Writing Prospectuses included in the Disclosure Package
