EXHIBIT 1.2
TCI COMMUNICATIONS, INC.
MEDIUM-TERM NOTES, SERIES C DUE
9 MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
, 199
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
CS First Boston Corporation
Park Avenue Plaza
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Brothers Inc.
American Express Tower
World Financial Center
New York, New York 10285-1800
Salomon Brothers Inc.
Seven World Trade Center
New York, New York 10048
Dear Sirs:
TCI Communications, Inc., a company duly incorporated under the laws of the
State of Delaware (the "Company"), confirms its agreement with Xxxxxxx Xxxxx &
Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, CS First Boston
Corporation, Xxxxxx Brothers Inc. and Salomon Brothers Inc (each, an "Agent"
and, collectively, the "Agents") with respect to the issue and sale by the
Company of Medium-Term Notes, Series C described herein (the "Notes"). The
Notes are to be issued pursuant to an indenture, dated as of , 199 (the
"Indenture"), between the Company and The Bank of New York, as trustee (the
"Trustee"). Securities issued or to be issued under the Indenture, including
the Notes, are herein called "Securities".
As of the date hereof, the Company has authorized the issuance and sale of up
to U.S. $750,000,000 aggregate principal amount of Notes through or to the
Agents pursuant to the terms of this Agreement. It is understood, however, that
the Company may from time to time authorize the issuance of additional Notes
and that such additional Notes may be sold through or to the Agents pursuant to
the terms of this Agreement, all as though the issuance of such Notes were
authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company directly to
purchasers, in which case an Agent will act as an agent of the Company in
soliciting Note purchases, and (as may from time to time be agreed to by the
Company and an Agent) to an Agent as principal for resale to purchasers.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33- ) relating to,
among other things, the Securities and the offering thereof
from time to time in accordance with Rule 415 under the Securities Act of
1933, as amended (the "1933 Act"), and has filed such amendments thereto as
may have been required to the date hereof. Such registration statement, as
amended, has been declared effective by the Commission, and the Indenture has
been qualified under the Trust Indenture Act of 1939, as amended (the "1939
Act"). Such registration statement, as amended as of each respective
Representation Date (as herein defined) (and any further registration
statements which may be filed by the Company for the purpose of registering
additional Notes), and the prospectus and prospectus supplement relating to
the Notes constituting a part thereof as amended and supplemented as of each
respective Representation Date, including in each case all documents
incorporated therein by reference and all exhibits thereto, as from time to
time amended or supplemented pursuant to the Securities Exchange Act of 1934,
as amended (the "1934 Act"), the 1933 Act or otherwise, are referred to herein
as the "Registration Statement" and the "Prospectus", respectively, except
that if any revised prospectus shall be provided to the Agents or any of them
by the Company for use in connection with the offering of the Notes which is
not required to be filed by the Company pursuant to Rule 424(b) under the 1933
Act, the term "Prospectus" shall refer to such revised prospectus and
prospectus supplement from and after the time it is first provided to the
Agents or any of them for such use.
Section 1. Appointment as Agents.
(a) Appointment of Agents. Subject to the terms and conditions stated
herein, the Company hereby appoints each of the Agents as agent of the Company
for the purpose of soliciting purchases of the Notes from the Company by
others and agrees that, except as otherwise contemplated herein, whenever the
Company determines to sell Notes directly to an Agent as principal for resale
to others, the Agent will enter into a Terms Agreement with the Company
(hereafter defined) relating to such sale in accordance with the provisions of
Section 3(b) hereof. Each Agent is authorized to engage the services of any
other broker or dealer in connection with the offer or sale of the Notes
purchased by the Agent as principal for resale to others but is not authorized
to appoint sub-agents. The Company may, from time to time, offer Notes for
sale otherwise than through an Agent; provided, however, that so long as this
Agreement shall be in effect the Company shall not solicit or accept offers to
purchase Notes through any agent other than an Agent, unless such agent shall
have entered into an agreement with the Company substantially similar to this
Agreement (including, but not limited to, Schedule A hereto). Written notice
of such agreement shall be given to the Agents within one day of the execution
thereof. In addition, the Company shall have the right at any time or from
time to time to sell Notes directly to investors.
(b) Reasonable Best Efforts Solicitations; Right to Reject Offers. Upon
receipt of instructions from the Company, each Agent will use its reasonable
best efforts to solicit purchases of such principal amount of the Notes as the
Company and the Agents shall agree upon from time to time during the term of
this Agreement, it being understood that the Company from time to time may
allocate or reallocate the Notes which are to be sold by any Agent and that
the Company shall not approve the solicitation of purchases of Notes in excess
of the principal amount of Securities registered pursuant to the Registration
Statement that from time to time remain unsold. The Agents will have no
responsibility for maintaining records with respect to the aggregate principal
amount of Notes sold, or of otherwise monitoring the availability of Notes for
sale under the Registration Statement. Each Agent will communicate to the
Company, orally or in writing, each reasonable offer to purchase Notes. Each
Agent shall have the right, in its discretion reasonably exercised, to reject
any proposed purchase of Notes, as a whole or in part, and any such rejection
shall not be deemed a breach of the Agent's agreement contained herein. The
Company shall have the sole right to accept any offers to purchase the Notes
and may reject in its sole discretion any proposed purchase of the Notes, in
whole or in part.
(c) Solicitations as Agent; Purchases as Principal. In soliciting purchases
of the Notes on behalf of the Company, each Agent shall act solely as agent
for the Company and not as principal. Each Agent shall make reasonable best
efforts to assist the Company in obtaining performance by each purchaser whose
offer to purchase Notes has been solicited by the Agent and accepted by the
Company. No Agent shall have any obligation to purchase Notes from the Company
as principal, but an Agent may agree from time to time to purchase Notes as
principal. Any such purchase of Notes by an Agent as principal shall be made
pursuant to a Terms Agreement in accordance with Section 3(b) hereof.
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(d) Reliance. The Company and each Agent agree that any Notes the placement
of which an Agent arranges shall be placed by the Agent, and any Notes
purchased, by an Agent shall be purchased by the Agent, in reliance on the
representations, warranties, covenants and agreements of the Company contained
herein and on the terms and conditions and in the manner provided herein, in
the Prospectus and in the Administrative Procedures (as defined in Section
3(c)).
Section 2. Representations and Warranties.
The Company represents and warrants to each Agent as of the date hereof, as
of the date of each acceptance by the Company of an offer for the purchase of
Notes (whether through an Agent as agent or to an Agent as principal), as of
the date of each delivery of Notes (whether through an Agent as agent or to an
Agent as principal) (the date and time of each such delivery to an Agent as
principal being hereafter referred to as a "Settlement Time"), and as of any
time that the Registration Statement or the Prospectus shall be amended or
supplemented (other than by an amendment or supplement (i) providing solely for
the specification of or a change in the interest rates, maturities, pricing or
other similar terms of any Notes or a change in the principal amount of Notes
remaining to be sold or similar changes (each an "Excluded Supplement") or (ii)
relating to an offering of Securities other than the Notes) or that there is
filed with the Commission any document incorporated by reference into the
Prospectus (other than any Current Report on Form 8-K relating exclusively to
the issuance of Securities other than the Notes under the Registration
Statement) (each of the dates or times referenced above being referred to
herein as a "Representation Date") as follows:
(a) Incorporated Documents. The documents incorporated by reference in
the Registration Statement and the Prospectus, when they were filed (or, if
an amendment with respect to any such document was filed, when such
amendment was filed) with the Commission, conformed in all material
respects to the requirements of the 1934 Act and the rules and regulations
of the Commission promulgated thereunder (the "1934 Act Regulations"), and
any further documents so filed and incorporated by reference will, when
they are filed with the Commission, conform in all material respects to the
requirements of the 1934 Act and the 1934 Act Regulations; none of such
documents, when it was filed (or, if an amendment with respect to any such
document was filed, when such amendment was filed), contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading; and no
such further document, when it is filed, will contain an untrue statement
of a material fact or will omit 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 are made, not misleading.
(b) Registration Statement and Prospectus. The Registration Statement and
the Prospectus, at the time the Registration Statement became effective and
the Registration Statement and Prospectus as then amended or supplemented
as of each Representation Date, complied and will comply in all material
respects with the 1933 Act and the rules and regulations of the Commission
thereunder (the "1933 Act Regulations") and the Indenture will comply in
all material respects with the requirements of the 1939 Act and the rules
and regulations of the Commission thereunder (the "1939 Act Regulations").
The Registration Statement, at the time the Registration Statement became
effective (or, if an amendment to the Registration Statement or an annual
report on Form 10-K of the Company incorporated by reference into the
Prospectus has been filed with the Commission subsequent to the
effectiveness of the Registration Statement, then at the time of the most
recent such filing) and as then amended or supplemented as of each
Representation Date, did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The
Prospectus, at the time the Registration Statement became effective and as
then amended or supplemented as of each Representation Date, did not and
will not contain an 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 representations and warranties in this
subsection shall not apply (i) with respect to an Agent, to statements or
omissions from the Registration Statement or Prospectus made in reliance
upon and in conformity with information furnished to the
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Company by or on behalf of such Agent expressly for use in the Registration
Statement or Prospectus or (ii) to that part of the Registration Statement
which shall constitute the Statement of Eligibility and Qualification under
the 1939 Act (Form T-1) of the Trustee under the Indenture.
(c) The Notes and The Indenture. The Notes and the Indenture have been
duly authorized by the Company and conform to the descriptions thereof in
the Prospectus.
(d) No Defaults. The issuance and sale of the Notes and the fulfillment
of the terms of this Agreement will not result in a breach of any of the
terms or provisions of, or constitute a default under, (i) the Company's
charter or bylaws, (ii) any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company or any of its Significant
Subsidiaries (as such term is defined in Rule 1.02(v) of Regulation S-X) is
now a party or by which it is bound which would have a material adverse
effect on the conduct of the business of the Company and its consolidated
subsidiaries considered as one enterprise, or (iii) any order of any court
or governmental agency or authority entered in any proceeding to which the
Company or any of its Significant Subsidiaries was or is now a party or by
which it is bound.
(e) Accountants. KPMG Peat Marwick LLP, the Company's auditors, or its
successor are independent accountants as required by the 1933 Act.
(f) 1934 Act Filings. So long as may be required for the distribution of
the Notes by the Agents or by any dealers that participate in the
distribution thereof, the Company will comply with all requirements under
the 1934 Act relating to the timely filing with the Commission of its
reports pursuant to Section 13 of the 1934 Act and of its proxy statements
pursuant to Section 14 of the 1934 Act.
(g) Operating Permits, Certificates, etc. Except to the extent set forth
in the Prospectus, the Company has not received any notice of, nor does it
have any actual knowledge of, any failure by it or any of its Significant
Subsidiaries to be in substantial compliance with all material existing
statutes and regulations applicable to it or such Significant Subsidiaries,
which failure would materially and adversely affect the conduct of the
business of the Company and its consolidated subsidiaries, considered as
one enterprise.
Any certificate required hereby, signed by any executive officer of the
Company or Assistant Treasurer and delivered to an Agent or counsel for the
Agents shall be deemed a representation and warranty by the Company as to the
matters covered thereby.
Section 3. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein
set forth, each Agent agrees, as an agent of the Company, to use its
reasonable best efforts to solicit offers to purchase the Notes upon the terms
and conditions set forth herein, in the Prospectus and in the Administrative
Procedures.
The Company reserves the right, in its sole discretion, to (i) suspend
solicitation of purchases of the Notes through the Agents, in each case as
agent, commencing at any time for any period of time or permanently, and (ii)
allocate or reallocate the Notes which are to be sold by any Agent. Upon
receipt of instructions from the Company, each Agent receiving such
instructions will forthwith suspend solicitation of purchases from the Company
until such time as the Company has advised said Agent that such solicitation
may be resumed.
The Company agrees to pay each Agent a commission with respect to each
consummation of the sale of a Note by the Company as a result of a
solicitation made by such Agent, in the form of a discount, equal to the
applicable percentage as set forth in Schedule A hereto of the principal
amount of such Note or, in the case of an Original Issue Discount Note (as
defined in the Prospectus), of the Issue Price (as defined in the Prospectus)
of such Note.
The purchase price, interest rate, maturity date and other terms of the
Notes in connection with each sale of Notes to or through an Agent shall be
agreed upon by the Company and the Agent and set forth in a pricing
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supplement to the Prospectus to be prepared following each acceptance by the
Company of an offer for the purchase of Notes. Except as may be otherwise
provided in such supplement to the Prospectus, the Notes will be issued in
denominations of $1,000 or an integral multiple of $1,000. All Notes sold
through an Agent as agent will be sold at 100% of their principal amount unless
otherwise agreed to by the Company and the Agent.
(b) Purchases as Principal. Each sale of Notes to an Agent as principal shall
be made in accordance with the terms contained herein and (unless the Company
and such Agent shall otherwise agree in writing) only pursuant to a separate
agreement which shall provide for the sale of such Notes to, and the purchase
and reoffering thereof by, such Agent. Each such separate agreement (which may
be an oral agreement, confirmed in writing which may be a facsimile
transmission) between an Agent and the Company is herein referred to as a
"Terms Agreement". Unless the context otherwise requires, each reference
contained herein to "this Agreement" shall be deemed to include any applicable
Terms Agreement between the Company and an Agent. Each such Terms Agreement,
whether oral, confirmed in writing which may be a facsimile transmission, or in
writing, shall be with respect to such information (as applicable) as is
specified in Exhibit A hereto. An Agent's commitment to purchase Notes as
principal pursuant to any Terms Agreement shall be deemed to have been made on
the basis of the representations and warranties of the Company herein contained
and shall be subject to the terms and conditions herein set forth. Each Terms
Agreement with an Agent shall specify the principal amount of Notes to be
purchased by the Agent pursuant thereto, the price to be paid to the Company
for such Notes (which shall be at a discount equivalent to the applicable
commission set forth in Schedule A hereto unless otherwise specified in an
applicable Terms Agreement), the Settlement Time and place of delivery of and
payment for such Notes, any provisions relating to rights of, and default by,
purchasers acting together with the Agent in the reoffering of the Notes, and
such other provisions (including further terms of the Notes) as may be mutually
agreed upon. Each Agent may utilize a selling or dealer group in connection
with the resale of the Notes purchased. The Terms Agreement shall also specify
the requirements for the officer's certificate, opinions of counsel and comfort
letter pursuant to Sections 7(b), 7(c) and 7(d) hereof and, if applicable, the
period of time referred to in Section 4(g). With respect to any Notes purchased
by an Agent as principal pursuant to a Terms Agreement that have not been
resold by such Agent prior to the earlier of (i) the 90th day following the
related Settlement Time and (ii) a date specified in an applicable Terms
Agreement, such Agent agrees (and by entering into such Terms Agreement shall
be deemed to have reconfirmed such agreement) that upon receipt of written
notice from the Company of its intention to bid for or purchase any Notes or
any security of the same class and series as the Notes or to take any other
action, directly or indirectly, the taking of which would be proscribed by Rule
l0b-6 under the 1934 Act (or any successor or equivalent rule or regulation)
during the reoffering of the Notes, such Agent will, and will cause any selling
or dealer group utilized by it in connection with such reoffering, to cease
reoffering such Notes for such period of time as the Company may deem necessary
so that the action or actions proposed to be taken, directly or indirectly, by
it may be taken in full compliance with such Rule (or any successor or
equivalent rule or regulation).
(c) Administrative Procedures. Administrative procedures with respect to the
sale of Notes shall be agreed upon from time to time by the Agents and the
Company (the "Administrative Procedures"). The Agents and the Company agree to
perform the respective duties and obligations specifically provided to be
performed by them in the Administrative Procedures.
Section 4. Covenants of the Company. The Company covenants with each Agent as
follows:
(a) Notice of Certain Events. Prior to the termination of the offering of
the Notes, the Company will notify the Agents promptly, and (if requested
by the Agents in writing) will confirm such advice in writing, (1) of the
effectiveness of any amendment to the Registration Statement and of the
filing of any supplement to the Prospectus (other than an Excluded
Supplement or an amendment or supplement providing solely for the inclusion
of additional financial information, and, unless the Agents shall otherwise
specify, an amendment or supplement which relates exclusively to an
offering of Securities other than the Notes), (2) of any comments of the
Commission regarding the Registration Statement or the Prospectus (or any
of the documents incorporated by reference therein) or of any request by
the Commission for amendments or
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supplements to the Registration Statement or the Prospectus or for
additional information, (3) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
initiation or threatening of any proceedings for that purpose, (4) of the
receipt by the Company of any notification with respect to the suspension
of the qualification of the Notes for offer or sale in any jurisdiction or
the initiation or threatening of any proceedings for such purpose and (5)
of the happening of any event during the period mentioned in paragraph (d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires the making of any
changes in the Registration Statement or the Prospectus in order to make
the statements therein, in light of the circumstances when the Prospectus
is delivered to a purchaser, not misleading. Upon receipt of notice of an
event described in (3), (4) or (5) above, the Agents shall cease
solicitations of offers to purchase the Notes, as agent, and cease sales of
Notes the Agents may own as principal; provided, however, that if such
cessation arises out of an event described in (4) above, it shall be
limited to cessation of solicitation of offers to purchase and sales in the
jurisdiction or jurisdictions identified in such notice. The Company will
use its reasonable best efforts to prevent the issuance of any order
suspending the effectiveness of the Registration Statement or suspending
the qualification of the Notes for offer or sale in any jurisdiction, and
if any such order is issued, the Company will make every reasonable effort
to obtain the withdrawal of such order at the earliest possible moment.
(b) Executed Registration Statement. The Company will furnish to each of
the Agents, without charge, one signed copy of the Registration Statement
and any post-effective amendment thereto, including all financial
statements and schedules, exhibits and documents incorporated therein by
reference (including exhibits incorporated therein by reference to the
extent not previously furnished to the Agents).
(c) Notice of Certain Proposed Filings. Prior to the termination of the
offering of the Notes, the Company will not file any amendment or
supplement to the Registration Statement or the Prospectus (except for (i)
periodic or current reports filed under the 1934 Act, (ii) an Excluded
Supplement, or (iii) a supplement relating to an offering of Securities
other than the Notes) unless the Company has furnished each Agent a copy
for its review prior to filing such proposed amendment or supplement.
(d) Copies; Revisions of Prospectus--Material Changes. During the period
of time that the Prospectus is required by law to be delivered, the Company
will deliver to the Agents, without charge, as many copies of the
Prospectus, as amended or supplemented, as the Agents may reasonably
request. The Company consents to the use of the then current Prospectus, as
amended or supplemented, by the Agents in connection with the offering or
sale of the Notes and for such period of time thereafter as the Prospectus
is required by law to be delivered in connection therewith. If during such
period of time, any event shall occur which in the judgment of the Company
should be set forth (or incorporated by reference) in the Prospectus in
order to make the statements therein, in light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to supplement the Prospectus or amend the Registration Statement
to comply with law, immediate notice shall be given by the Company, and
confirmed in writing, to the Agents to cease the solicitation of offers to
purchase the Notes in the Agents' capacity as agents and to cease sales of
any Notes the Agents may then own as principals pursuant to a Terms
Agreement (and, if so notified by the Company, each Agent shall forthwith
cease such solicitations and sales), and the Company will forthwith prepare
and duly file with the Commission an appropriate supplement or amendment
thereto, and forthwith file all reports and any definitive proxy statement
or information statement required to be filed by the Company with the
Commission pursuant to Section 13 or 14 of the 1934 Act subsequent to, the
date of the Prospectus, and will deliver to the Agents, without charge,
such number of copies thereof as they may reasonably request. If during
such period of time any event shall occur which in the Agents' judgment
should be so set forth (or incorporated by reference), in the Prospectus,
or which in the Agents' judgment makes it necessary to so supplement or
amend the Prospectus, the Company will consult with the Agents concerning
the necessity of filing with the Commission a supplement or an amendment to
the Prospectus or a report pursuant to Section 13 or 14 of the 1934 Act.
(e) Blue Sky. Prior to any public offering of the Notes by the Agents,
the Company will cooperate with the Agents and counsel for the Agents in
connection with the registration or qualification of the Notes
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for offer and sale under the securities or Blue Sky laws of, and the
determination of the eligibility of the Notes for investment under the laws
of, such jurisdictions as the Agents request; provided, that in no event
shall the Company be obligated to qualify to do business as a foreign
corporation or as a securities dealer in any jurisdiction where it is not
now so qualified, to conform its capitalization or the composition of its
assets to the securities or Blue Sky laws of any jurisdiction or to take
any action which would subject it to taxation or general service of process
in any jurisdiction where it is not now so subject. The Company will pay
all reasonable fees and expenses (including reasonable counsel, fees and
expenses) relating to qualification of the Notes under such securities or
Blue Sky laws and in connection with the determination of the eligibility
of the Notes for investment under the laws of such jurisdictions as the
Agents may designate.
(f) Earnings Statements. The Company will make generally available to its
security holders and to the Agents consolidated earnings statements (which
need not be audited) that satisfy the provisions of Section 11(a) of the
1933 Act and Rule 158 thereunder.
(g) Stand-Off Agreement. Between the date of any Terms Agreement and the
Settlement Time or such other time as is specified in the Terms Agreement,
the Company will not offer or sell, or contract to sell, any substantially
similar debt securities of the Company to those issued pursuant to the
Terms Agreement, which may include substantially similar Notes, pursuant to
a public offering of such similar debt securities without the prior written
consent of the Agent party to such Terms Agreement which, shall not be
unreasonably withheld.
(h) Preparation of Pricing Supplements. The Company will prepare, with
respect to each Note to be sold through or to an Agent pursuant to this
Agreement, a pricing supplement with respect to such Notes in a general
form previously approved by the Agents, and will file such pricing
supplement pursuant to the applicable paragraph of Rule 424(b) under the
1933 Act within the time period therein prescribed.
(i) Suspension of Certain Obligations. The Company shall not be required
to comply with the provisions of subsections (b), (c) or (d) of this
Section during any period from the time (i) any Agent shall have suspended
solicitation of purchases of the Notes in its capacity as agent pursuant to
a request from the Company and (ii) any Agent shall not then hold any Notes
as a principal, purchased pursuant to a Terms Agreement, to the time the
Company shall determine that solicitation of purchases of the Notes should
be resumed or shall subsequently enter into a new Terms Agreement with an
Agent.
Section 5. Conditions of Obligations. The obligations of each Agent to solicit
offers to purchase the Notes as agent of the Company, the obligations of any
purchasers of the Notes sold through an Agent as agent, and any obligation of
an Agent to, purchase Notes pursuant to a Terms Agreement will be subject to
the accuracy of the representations and warranties on the part of the Company
contained in Section 2 hereof and in any certificate furnished pursuant to the
provisions hereof, to the performance and observance by the Company of all of
its covenants and agreements herein contained and to the following additional
conditions precedent:
(a) Legal Opinions. On the date hereof, the Agents shall have received:
(1) The favorable opinions, dated as of the date hereof, from (A) special
communications counsel for the Company with respect to matters of
communications law, and (B) General Counsel of the Company, in form and
substance satisfactory to the Agents, to the effect that:
(i) the Company and each of its Significant Subsidiaries is a
corporation duly incorporated, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has the
corporate power and authority to carry on its business as described in
the Prospectus and the Company has the corporate power and authority to
execute and deliver and perform its obligations under this Agreement
and to issue and sell the Notes as contemplated by this Agreement;
(ii) the Company and each of its Significant Subsidiaries is duly
qualified as a foreign corporation and is in good standing in each
jurisdiction in which the failure to so qualify would, in the
aggregate, have a material adverse effect upon the financial condition,
results of operations, business or properties of the Company and its
consolidated subsidiaries taken as a whole;
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(iii) all corporate proceedings legally required in connection with
the authorization and issuance of the Notes and the sale of the Notes
by the Company in accordance with the terms of this Agreement have been
taken;
(iv) to the best knowledge of such counsel, there is no legal or
governmental proceeding pending or threatened against the Company or
any of its subsidiaries which is required to be disclosed in the
Prospectus and is not so disclosed and correctly summarized therein;
(v) to the best knowledge of such counsel, there is no contract or
other document known to such counsel of a character required to be
described in the Prospectus or to be filed as an exhibit to the
Registration Statement (or to a document incorporated by reference
therein) that is not described or filed as required;
(vi) the execution and delivery of this Agreement and the Indenture,
the issuance of the Notes and the fulfillment of the terms herein and
therein contained do not conflict with, or result in a breach of, or
constitute a default under, the charter or by-laws of the Company or,
to the best knowledge of such counsel, conflict in any material respect
with, or result in a material breach of or constitute a material
default under any material agreement or other instrument known to such
counsel to which the Company or any of its Significant Subsidiaries is
a party or by which it is bound, or result in a violation of any law,
administrative regulation or court or governmental decree known to such
counsel applicable to the Company or any of its subsidiaries, except
that such counsel need not express any opinion with respect to (i)
matters opined upon by other special counsel to the Company or (ii) the
Blue Sky or securities laws of any jurisdiction; and
(vii) such counsel has no reason to believe that either the
Registration Statement or the Prospectus, as amended or supplemented,
if applicable (except as to financial statements and schedules and any
other financial and statistical data contained or incorporated by
reference in the Registration Statement or Prospectus, as to which no
opinion need be expressed), contained, as of the date the Prospectus
was first filed with the Commission pursuant to Rule 424 under the 1933
Act, or contains, as of the date hereof, or (if such opinion is being
delivered in connection with, a Terms Agreement pursuant to Section
7(c) hereof, at the date of such Terms Agreement and at the Settlement
Time with regard thereto, as the case may be), any untrue statement of
a material fact or omitted or omits to state any material fact required
to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which
they were made) not misleading.
(2) The favorable opinion, dated as of the date hereof, from special
counsel to the Company, in form and substance satisfactory to the Agents,
to the effect that:
(i) the execution and delivery of this Agreement and the Indenture,
the issuance of the Notes and the fulfillment of the terms herein and
therein contained do not, to the best knowledge of such counsel, result
in a material breach of or constitute a material default under any
material agreement for borrowed money known to such counsel to which
the Company or any of its Significant Subsidiaries is a party or by
which it is bound, and
(ii) the Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, and is not subject to
regulation under such Act.
(3) The favorable opinion, dated as of the date hereof, from special
counsel to the Company, in form and substance satisfactory to the Agents,
to the effect that:
(i) this Agreement and the Indenture have been duly authorized,
executed and delivered by the Company; and the Indenture is a legal,
valid and binding agreement of the Company enforceable in accordance
with its terms, except (A) as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and other laws affecting creditors' rights generally, and
(B) that the remedy of specific performance and injunctive and other
forms of equitable relief are subject to certain equitable defenses and
to the discretion of the court before which any proceeding therefor may
be brought;
8
(ii) the Indenture has been duly qualified under, and complies in all
material respects with the requirements of, the 1939 Act;
(iii) the Notes, when executed by the Company, completed,
authenticated and delivered by the Trustee in accordance with the
Indenture, issued and delivered by the Company and paid for, all as
contemplated by and in accordance with the order of the Company, the
procedures specified therein and this Agreement, will be legal, valid
and binding obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms, except (A) as
such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and other laws
affecting creditors, rights generally, and (B) that the remedy of
specific performance and injunctive and other forms of equitable relief
are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought;
(iv) the Registration Statement is effective under the 1933 Act and,
to the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened by the Commission;
and
(v) the Notes (subject to completion in accordance with the
applicable pricing supplement) and the Indenture conform in all
material respects as to legal matters to the descriptions thereof in
the Prospectus.
In addition, such counsel shall state that: "The Registration Statement and
the Prospectus (except as to (x) the financial statements and schedules and any
other financial and statistical data contained or incorporated by reference
therein and (y) the documents incorporated or deemed to be incorporated by
reference therein, as to which no opinion is expressed), comply as of the date
hereof, as to form in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations. In passing upon the form of such documents,
we have necessarily assumed the correctness and completeness of the statements
made or included therein by the Company and take no responsibility for the
accuracy, completeness or fairness of the statements contained therein except
insofar as such statements relate to the description of the Notes and the
Indenture or relate to us. However, we had conferences with certain officers
and other representatives of the Company, and our examination of the
Registration Statement and the Prospectus and our discussions in such
conferences did not disclose to us any information (relying as to the
materiality of any such information primarily upon officers and other
representatives of the Company) which gave us reason to believe that either the
Registration Statement or the Prospectus (except as to (x) the financial
statements and schedules and any other financial and statistical data contained
or incorporated by reference in the Registration Statement or Prospectus and
(y) the documents incorporated or deemed to be incorporated by reference
therein, as to which no opinion is expressed, and except as to the terms of the
particular Notes which are to be provided in the pricing supplement), contains,
as of the date hereof, any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading."
In giving such opinions, such counsel may rely (x) as to matters of fact, to
the extent they deem proper, upon certificates of officers of the Company,
public officials and others, and (y) as to matters of law other than the United
States or Colorado (in the case of General Counsel of the Company) or New York
(in the case of special counsel to the Company), on the opinions of local
counsel retained by them or the Company, provided that such counsel are
satisfactory to the Agents and counsel for the Agents. In addition, it is
understood that the General Counsel of the Company may elect to provide
favorable opinions with respect to the matters set forth in clause (i) of
subsection (a)(2) of this Section and clause (iv) of subsection (a)(3) of this
Section in lieu of special counsel to the Company providing such opinions.
(4) The favorable opinion, dated as of the date hereof, of counsel for
the Agents, with respect to the matters set forth in clauses (i) and (iii)
of subsection (a)(3) of this Section and to the effect that the
Registration Statement and the Prospectus (except as to (x) the financial
statements and schedules and any other financial and statistical data
contained or incorporated by reference therein and (y) the documents
9
incorporated or deemed to be incorporated by reference therein, as to which
no opinion need be expressed) comply as to form in all material respects
with the 1933 Act. In addition, the Agents shall have received on the date
hereof from counsel for the Agents, an opinion with respect to the
Registration Statement and the Prospectus in the form customarily given by
such firm.
(b) Material Changes; Officer's Certificates. On the date hereof there
shall not have been, since the respective dates as of which information is
given in the Registration Statement, any material adverse change or any
development resulting in the substantial possibility of a prospective
material adverse change in the condition, financial or otherwise, of the
Company and its consolidated subsidiaries considered as one enterprise, or
in the-earnings or business affairs of the Company and its consolidated
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the Agents shall have received a
certificate of the President, the Principal Financial Officer, the Senior
Vice President--Finance, Treasurer or the Assistant Treasurer of the
Company dated as of the date hereof, to the effect that (i) there has been
no such material adverse change with respect to the Company and its
consolidated subsidiaries considered as a whole, (ii) no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose are pending or threatened by the
Commission, (iii) the representations and warranties of the Company
contained in Section 2 are true and correct as of the date hereof, and (iv)
the Company has performed or complied with all agreements and satisfied all
conditions pursuant to this Agreement in connection with the issuance of
the Notes on its part to be performed or satisfied at or prior to the date
of such certificate.
(c) Comfort Letter. On the date hereof, the Agents shall have received
from KPMG Peat Marwick LLP or its successors or other independent certified
public accountants acceptable to the Agents a letter, dated as of the date
hereof, in form and substance reasonably satisfactory to the Agents.
(d) Other Matters. At each Settlement Time with respect to any Terms
Agreement, counsel for the Agents shall have been furnished with such
documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Notes as therein
contemplated and related proceedings or in order to evidence the accuracy
and completeness of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained. All proceedings
taken by the Company in connection with the issuance and sale of the Notes
as herein contemplated shall be satisfactory in form and substance to the
Agents.
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement (or, at the option of the
applicable Agent, any Terms Agreement) may be terminated by an Agent by notice
to the Company at any time (or, in the case of termination of a Terms
Agreement, at or at any time prior to the Settlement Time) and any such
termination shall be with the effect set forth in Section 12(c).
Section 6. Delivery of and Payment for Notes Sold through an Agent. Delivery of
Notes sold through an Agent as agent shall be made by the Company to the Agent
for the account of any purchaser only against payment therefor in immediately
available funds. In the event that a purchaser shall fail either to accept
delivery of, or to make payment for, a Note on the date fixed for settlement,
the Agent that solicited such purchaser shall promptly notify the Company and
deliver the Note to the Company, and, if the Agent has theretofore paid the
Company for such Note, the Company will return such funds to the Agent within
three business days. If such failure occurred for any reason other than default
by the Agent in the performance of its obligations hereunder, the Company will
reimburse the Agent for its loss of the use of the funds for the period such
funds were credited to the Company's account. Such reimbursement shall be in an
amount equal to the lower of the Company's cost of funds and the Agent's cost
of funds.
Section 7. Additional Covenants of the Company. The Company covenants and
agrees with the Agents that:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
it of an offer for the purchase of Notes, and each delivery of Notes to an
Agent pursuant to a Terms Agreement, shall be deemed to be an affirmation
that the representations and warranties of the Company contained in Section
2 of this
10
Agreement and in any certificate theretofore delivered to such Agent
pursuant hereto are true and correct at the time of such acceptance or
sale, as the case may be, and an undertaking that such representations and
warranties will be true and correct at the time of delivery to the
purchaser or his agent, or to such Agent, of the Note or Notes relating to
such acceptance or sale, as the case may be, as though made at and, as of
each such time (and it is understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as
amended and supplemented to each such time);
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an Excluded Supplement or by an amendment or supplement
providing solely for the inclusion of additional financial information, or,
unless the Agents shall otherwise specify, other than by an amendment or
supplement which relates exclusively to an offering of Securities other
than the Notes), or (ii) there is filed with the Commission any Report on
Form 10-K, or (iii) there is filed with the Commission any document
incorporated by reference into the Prospectus (other than any Current
Report on Form 8-K), or (iv) there is filed with the Commission any Current
Report on Form 8-K containing information that is reasonably deemed to be
materially adverse to the business affairs or prospects of the Company, or
(v) (if required pursuant to the terms of a Terms Agreement) the Company
sells Notes to an Agent pursuant to a Terms Agreement, the Company shall
furnish or cause to be furnished to the Agents forthwith a certificate
dated the date of filing with the Commission of such supplement or
document, the date of effectiveness of such amendment, or the date of such
sale, as the case may be, in form satisfactory to the Agent to the effect
that the statements contained in the certificate of the Company referred to
in Section 5(b) hereof which was last furnished to the Agent are true and
correct at the time of such amendment, supplement, filing or sale, as the
case may be, as though made at and as of such time (except that such
statements shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to such time) or, in lieu of such
certificate, a certificate of the same tenor as the certificate referred to
in said Section 5(b), modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such certificate. In the case of certificates to be furnished
pursuant to (iii) or (iv) above, the Company may request that the Agents
waive the requirement for the certificates, which request shall not be
unreasonably refused;
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an Excluded Supplement or by an amendment or supplement
providing solely for the inclusion of additional financial information, or,
unless the Agents shall otherwise specify, other than by an amendment or
supplement which relates exclusively to an offering of Securities other
than the Notes), (ii) there is filed with the Commission any Report on Form
10-K, (iii) there is filed with the Commission any document incorporated by
reference into the Prospectus (other than any Current Report on Form 8-K or
a Report on Form 10-Q), (iv) there is filed with the Commission any Current
Report on Form 8-K containing information that is reasonably deemed to be
materially adverse to the business affairs or prospects of the Company or
(v) (if required pursuant to the terms of a Terms Agreement) the Company
sells Notes to an Agent pursuant to a Terms Agreement, the Company shall
furnish or cause to be furnished forthwith to the Agents and to counsel to
the Agents the written opinions of the General Counsel of the Company and
special counsel to the Company or other counsel satisfactory to the Agent
dated the date of filing with the Commission of such supplement or
document, the date of effectiveness of such amendment, or the date of such
sale, as the case may be, in form and substance satisfactory to the Agents,
of the same tenor as the opinions referred to in Section 5(a)(1)(B) and
5(a)(3) hereof, but modified, as necessary, to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such opinions, or (vi) in lieu of any such opinion required
under Subsection (7)(c)(v) above, counsel last furnishing such opinion to
the Agents, shall furnish the Agents with a letter to the effect that the
Agents may rely on such last opinion to the same extent as though it was
dated the date of such letter authorizing reliance (except that statements
in such last opinion shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such letter authorizing reliance). In the case of opinions to
be furnished pursuant to (iii) or (iv) above, the Company may request that
Agents waive the requirement for the opinions, which request shall not be
unreasonably refused; and
11
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
to include additional financial information, (ii) there is filed with the
Commission any Report on Form 10-K, (iii) there is filed with the
Commission any document incorporated by reference to the Prospectus which
contains additional financial information (other than any Current Report on
Form 8-K), (iv) there is filed with the Commission any Current Report on
Form 8-K (containing additional information) which contains information
that is reasonably deemed to be materially adverse to the business affairs
or prospects of the Company, or (v) (if required pursuant to the terms of a
Terms Agreement) the Company sells Notes to an Agent pursuant to a Terms
Agreement, the Company shall cause KPMG Peat Marwick LLP or its successors
forthwith to furnish the Agents a letter, dated the date of filing with the
Commission of such amendment, supplement or document, the date of
effectiveness of such amendment, or the date of such sale, as the case may
be, in form satisfactory to the Agents, of the same tenor as the portions
of the letter delivered pursuant to Section 5(c) but modified to relate to
the Registration Statement and Prospectus, as amended and supplemented to
the date of such letter, and as may be necessary to reflect changes in the
financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration
Statement or the Prospectus is amended or supplemented solely to include
the financial information as of and for an interim period, KPMG Peat
Marwick LLP or its successors may limit the scope of such letter to the
unaudited financial statements included in such amendment or supplement
unless any other information included therein of an accounting, financial
or statistical nature is of such a nature that, in the reasonable judgment
of the Agents, such letter should cover such other information, and
provided, further, that the delivery of such letter by KPMG Peat Marwick
LLP (or its successors) shall be conditioned upon the receipt by KPMG Peat
Marwick LLP (or its successors) of an opinion of counsel for the Agents, in
form and substance reasonably satisfactory to KPMG Peat Marwick LLP (or
such successor) . In the case of letters to be furnished pursuant to (iii)
or (iv) above, the Company may request that the Agents waive the
requirement for the letters, which request shall not be unreasonably
refused.
Section 8. Payment of Expenses. The Company agrees to pay all expenses incident
to the performance of its obligations under this Agreement, including:
(a) the preparation and filing of the Registration Statement and all
amendments thereto and the Prospectus and any amendments or supplements
thereto;
(b) the preparation, filing and reproduction of this Agreement;
(c) the preparation, printing, and issuance and delivery of the Notes,
including any fees and expenses relating to the use of book-entry notes
(excluding any fees payable by an Agent solely as member of The Depository
Trust Company);
(d) the fees and disbursements of the Company's accountants and counsel,
of the Trustee and its counsel, and of any Calculation Agent or Exchange
Rate Agent;
(e) the reasonable fees and disbursements of counsel to the Agents
incurred from time to time in connection with the transactions contemplated
hereby;
(f) the qualification of the Notes under state securities laws in
accordance with the provisions of Section 4(e) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation of any Blue Sky
Survey and any Legal Investment Survey;
(g) the printing and delivery to the Agents in quantities as hereinabove
stated of copies of the Registration Statement and any amendments thereto,
and of the Prospectus and any amendment or supplements thereto, and the
delivery by the Agents of the Prospectus and any amendments or supplements
thereto in connection with solicitations or confirmations of sales of the
Notes;
(h) the preparation, printing, reproducing and delivery to the Agents of
copies of the Indenture and all supplements and amendments thereto;
12
(i) any fees charged by rating agencies for the rating of the Notes;
(j) the fees and expenses incurred in connection with the listing of the
Notes on any securities exchange;
(k) the fees and expenses, if any, incurred with respect to any filing
with the National Association of Securities Dealers, Inc.;
(l) any advertising and other out-of-pocket expenses of an Agent incurred
with the approval of the Company; and
(m) the fees and expenses of any Depository (as defined in the Indenture)
and any nominees thereof in connection with Notes.
Section 9. Indemnification. The Company agrees to indemnify and hold harmless
each Agent, and each person, if any, who controls each Agent within the meaning
of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, from and
against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation), as incurred, arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or
based upon any omission or alleged omission to state therein 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, except
insofar as such losses, claims, damages, liabilities or expenses arise out of
or are based upon any such untrue statement or omission or allegation thereof
based upon information furnished in writing to the Company by such Agent
expressly for use, therein; provided, however, the Company shall not indemnify
such Agent or any person who controls such Agent from any such losses, claims,
damages or liabilities alleged by any person who purchased Notes from such
Agent if the untrue statement, omission or allegation thereof upon which such
losses, claims, damages or liabilities are based was made in: (i) any
preliminary prospectus or Prospectus, if a copy of the Prospectus, or the
Prospectus as then amended or supplemented (if the Company shall have furnished
any amendments or supplements thereto), as the case may be, was not sent or
given by or on behalf of such Agent to such person at or prior to the written
confirmation of the sale of the Notes to such person, and if the Prospectus, or
the Prospectus as so amended or supplemented, as the case may be, corrected the
untrue statement or omission giving rise to such loss, claim, damage or
liability; (ii) any Prospectus used by such Agent (or any broker or dealer
appointed or engaged by such Agent) or any person who controls such Agent,
after such time as the Company advised such Agent that the filing of a post-
effective amendment or supplement thereto was required, except the Prospectus
as so amended or supplemented; or (iii) any Prospectus used by such Agent (or
any broker or dealer appointed or engaged by such Agent) or any person who
controls such Agent, after the termination of the offering of the Notes. This
indemnity will be in addition to any liability which the Company may otherwise
have.
If any action or proceeding (including any governmental investigation) shall
be brought or asserted against an Agent or any person controlling an Agent in
respect of which indemnity may be sought from the Company, such Agent or such
controlling person shall promptly notify the Company in writing, and the
Company shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Agent's party to such action or proceeding and
the payment of all expenses. Any omission so to notify the Company shall not,
however, relieve the Company from any liability which it may have to any
indemnified party otherwise than under this Section 9. Such Agent or any such
controlling person shall have the right to employ separate counsel in any such
action or proceeding and to participate in the defense thereof, but the fees
and expenses of such separate counsel shall be such Agent's expense or the
expense of such controlling person unless (a) the Company has agreed to pay
such fees and expenses, (b) the Company shall have failed to assume the defense
of such action or proceeding and employ counsel reasonably satisfactory to the
Agents in any such action or proceeding or (c) the named parties to any such
action or proceeding (including any impleaded parties) include an Agent or any
such controlling person and the Company, and such Agent or such controlling
person shall have been advised by such counsel that there may be a conflict of
interest between such Agent or such controlling person and the
13
Company in the conduct of the defense of such action (in which case, if such
Agent or such controlling person notifies the Company in writing that it elects
to employ separate counsel at the expense of the Company, the Company shall not
have the right to assume the defense of such action or proceeding on such
Agent's behalf or on behalf of such controlling person, it being understood,
however, that the Company shall not, in connection with anyone such action or
proceeding or separate but substantially similar or related actions or
proceedings arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (unless the members of such firm are not admitted to practice in a
jurisdiction where an action is pending, in which case the Company shall pay
the reasonable fees and expenses of one additional firm of attorneys to act as
local counsel in such jurisdiction, provided the services of such counsel are
substantially limited to that of appearing as attorneys of record) at any time
for all indemnified parties, which firm shall be designated in writing by such
Agent). The Company shall not be liable for any settlement of any such action
or proceeding effected without its written consent, but if settled with its
written consent, or if there be a final judgment for the plaintiff if any such
action or proceeding, the Company agrees to indemnify and hold harmless the
Agent and any such controlling person from and against any loss or liability by
reason of such settlement or judgment.
Each Agent agrees to indemnify and hold harmless the Company, its directors
and each of its officers, and each person, if any, who controls the Company
within the meaning of either Section 15 of the 1933 Act or Section 20 of the
1934 Act, to the same extent as the foregoing indemnity from the Company to the
Agents, but only with respect to information furnished in writing by such Agent
expressly for use in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any preliminary prospectus, or any
amendment or supplement thereto, or any preliminary prospectus. In case any
action or proceeding shall be brought against the Company or its directors or
officers or any such controlling person, in respect of which indemnity may be
sought against an Agent, such Agent shall have the rights and duties given to
the Company, and the Company or its directors or officers or such controlling
person shall have the rights and duties given by the Agents, by the preceding
paragraph.
Section 10. Contribution. If the indemnification provided for in Section 9 is
unavailable to an indemnified party under the first or third paragraph thereof
in respect of any losses, claims, damages or liabilities referred to therein
(other than by reason of such indemnified party's failure to comply with the
first sentence of the second paragraph of Section 9), then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, as incurred (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and by each Agent on the other hand from the offering
of the Notes to which such loss, claim, damage or liability (or action in
respect thereof) relates, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of each Agent on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and by each Agent on the other in connection with the offering of the Notes
shall be deemed to be such that each Agent shall be responsible for the
aggregate losses, claims, damages and liabilities represented by the percentage
that the total underwriting discounts and agency commissions received by such
Agent with respect to the Notes giving rise to such losses, claims, damages or
liabilities bears to the total net proceeds for the sale of such Notes, and the
Company shall be responsible for the balance. The relative fault of the Company
shall be responsible for the balance. The relative fault of the Company on the
one hand of each Agent on the other shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by each Agent and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The amount paid or payable by a party as a result
of the losses, claims, damages and liabilities referred to above shall be
deemed to include, subject to the limitations set forth in the second paragraph
of Section 9, any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim.
14
The Company and each Agent agree that it would not be just and equitable if
contribution pursuant to this Section 10 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 10, each Agent shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Notes were offered to the public exceeds the amount of any
damages which such Agent has otherwise been required to pay be reason of such
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.
Section 11. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement by the
Company and the Agents, or contained in certificates of executive officers of
the Company submitted pursuant hereto, shall remain operative and in full force
and effect regardless of any investigation made by or on behalf of any Agent or
controlling person, or by or on behalf of the Company, and shall survive each
delivery of and payment for any Notes.
Section 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any Terms
Agreement) may be terminated for any reason, at any time by the Company with
respect to any of the Agents, and any Agent may resign as Agent hereunder, upon
the giving of 1 day written notice of such termination to the other parties
hereto; provided, however, that in the event this Agreement is terminated with
respect to only one of the Agents, this Agreement shall remain in full force
and effect between the Company and other Agents.
(b) Termination of a Terms Agreement. An Agent may terminate any Terms
Agreement between such Agent and the Company, immediately upon notice to the
Company, at any time at or prior to the Settlement Time relating thereto (i) if
there has been since the date of the Terms Agreement or since the respective
dates as of which information is given in the Prospectus (as amended or
supplemented to the date of the Terms Agreement), any material adverse change
in the condition, financial or otherwise, of the Company and its consolidated
subsidiaries considered as one enterprise, or in the earnings, business affairs
or business prospects of the Company and its consolidated subsidiaries
considered as one enterprise, whether not arising in the ordinary course of
business, (ii) if there shall have occurred any material adverse change in the
financial markets in the United States or any outbreak or escalation of
hostilities or other national or international calamity or crisis the effect of
which on the financial markets of the United States is such as to make it, in
the judgment if such Agent, impracticable to market the Notes or enforce
contracts for the sale of the Notes, (iii) if the rating assigned by any
nationally recognized securities rating agency in the United States to any debt
securities of the Company as of the date of the Terms Agreement or if any such
rating agency shall have publicly announced that it has placed any debt
securities of the Company on what is commonly termed a "watch list" for
possible downgrading, or (iv) if there shall have come to such Agent's
attention any facts that would cause such Agent reasonably to believe that the
Prospectus contains an untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in the light
of the circumstances then existing, not misleading.
(c) General. In the event of any such termination pursuant to subsection (a)
or (b) above or Section 5 hereof, the resigning or terminating party will have
no liability to the other parties hereto and no other remaining party hereto
will have any liability to the resigning or terminating party, except that (i)
each Agent shall be entitled to any commission earned in accordance with the
third paragraph of Section 3(a) hereof, (ii) if at the time of termination by
the Company (a) an Agent shall own any Notes purchased pursuant to a Terms
Agreement with the intention of reselling them or (b) an offer to purchase any
of the Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto has not occurred,
the covenants set forth in Sections 4 and 7 hereof shall remain in effect until
(i) the earlier of the date such Notes are so resold or at the 90th day
following the related Settlement Time or (ii) such Notes are delivered, as the
case may be, and (iii) the last sentence of Section 3(b), the covenant
regarding provision of an earnings statement set forth in Section 4(f) hereof,
the provisions concerning payment of expenses set forth in Section
15
4(e) and Section 8 hereof, the indemnity and contribution agreements set forth
in Section 9 and 10 hereof and the provisions of Section 11 (but only as such
Sections relates to representations and warranties) and Section 14 hereof shall
remain effect.
Section 13. Notices. Unless otherwise provided herein, all notices required
under the terms and provisions hereof shall be in writing, either delivered by
hand, by mail or by telex, telecopier or telegram, and any such notice shall be
effective when received it the address specified below.
If to the Company:
TCI Communications, Inc.
Terrace Tower II
0000 XXX Xxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-3000
Attention:Xxxxxxx X. Xxxxxxxxx
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
with a copy (similarly addressed) to the attention of the General Counsel.
If to the Agents:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
North Tower--10th Floor
World Financial Center
New York, New York 10281-1310
Attention:MTN Product Management
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
or, as the case may be,
CS First Boston Corporation
Park Avenue Plaza
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:New Issue Processing,
Xxxxxx X. Xxxxxxx
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
or, as the case may be,
Xxxxxx Brothers
American Express Tower
World Financial Center
New York, New York 10285-1800
Attention:Medium-Term Note Department
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
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or, as the case may be,
Salomon Brothers Inc.
Seven World Trade Center
New York, New York 10048
Attention:Medium-Term Note Department
Telephone:(000) 000-0000
Facsimile:(000) 000-0000
or at such other address as such party may designate from time to time by
notice duly given in accordance with the terms of this Section 13.
Section 14. Parties. This Agreement shall inure to the benefit of and be
binding upon the Agents and the Company, and their respective successors.
Nothing expressed or mentioned in any Terms Agreement or this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the parties hereto or thereto and their respective successors and the
controlling persons and officers and directors referred to in Sections 9 and 10
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under, or in respect of, this Agreement or any provision herein
contained. This Agreement and all conditions and provisions thereof and hereof
are intended to be for the sole and exclusive benefit of the parties and their
respective successors and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Notes from any Agent shall be
deemed to be a successor by reason merely of such purchase.
Section 15. Governing Law. This Agreement shall be governed by the laws of the
State of New York applicable to agreements made and performed in such State.
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all counterparts will become a binding
agreement among the Agents and the Company in accordance with its terms.
Very truly yours,
TCI Comunications, Inc.
By: _________________________________
Name: Xxxxxxx X. Xxxxxxxxx
Title: Senior Vice President--
Finance and Treasurer
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Accepted:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By: ___________________________
Authorized Signatory
CS First Boston Corporation
By: ___________________________
Authorized Signatory
Salomon Brothers Inc.
By: ___________________________
Authorized Signatory
Xxxxxx Brothers Inc.
By: ___________________________
Authorized Signatory
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SCHEDULE A
As compensation for the services of the Agents hereunder, the Company shall
pay, on a discount basis, at the Settlement Time to each Agent a commission in
connection with each original issuance of Notes by the Company for the sale of
each Note resulting from a placement made by such Agent equal to the principal
amount of such Note (or, if such Note is an Original Issue Discount Note, the
Issue Price of such Note) multiplied by the appropriate percentage set forth
below:
PERCENT OF PRINCIPAL AMOUNT
----------------------------
MATURITY RANGES SPLIT RATED INVESTMENT GRADE
--------------- ----------- ----------------
From 9 months to less than 1 year.................. .150% .125%
From 1 year to less than 18 months................. .200 .150
From 18 months to less than 2 years................ .250 .200
From 2 years to less than 3 years.................. .350 .250
From 3 years to less than 4 years.................. .450 .350
From 4 years to less than 5 years.................. .550 .450
From 5 years to less than 6 years.................. .600 .500
From 6 years to less than 7 years.................. .600 .550
From 7 years to less than 8 years.................. .700 .600
From 8 years to less than 9 years.................. .700 .600
From 9 years to less than 10 years................. .700 .600
From 10 years to less than 12 years................ .800 .625
From 12 years to less than 15 years................ .800 .625
From 15 years to less than 20 years................ .875 .700
From 20 years to 30 years.......................... .925 .750
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EXHIBIT A
TO
DISTRIBUTION
AGREEMENT
TERMS AGREEMENT PROVISIONS
The following terms, if applicable, shall be agreed to by the applicable
Agent and the Company pursuant to each Terms Agreement:
Principal Amount: $
(or principal amount of foreign currency)
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate:
Initial Interest Reset Date:
Spread or Spread Multiplier, if any:
Interest Reset Dates:
Interest Payment Dates:
Index Maturity:
Maximum Interest Rate, if any:
Maximum Interest Rate, if any:
Interest Determination Dates:
Calculation Agent and Dates:
If Redeemable by the Company:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
If Repayable by the holder thereof:
Xxxxxx's Optional Repayment Date(s):
Stated Maturity:
Purchase Price: %
Settlement Time:
Currency of Denomination:
Denominations (if currency is other than solely United States dollars):
Currency Payment:
Additional Terms:
Also, agreement as to whether the following will be required:
Officer's Certificates pursuant to Section 7(b) of the Distribution
Agreement.
Accountant's Comfort Letters pursuant to Section 7(d) of the
Distribution Agreement.
Legal Opinions pursuant to Section 7(c) of the Distribution Agreement.
Stand-Off Agreement pursuant to Section 4(g) of the Distribution
Agreement.
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